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In a measure to solidify its presence as the epicenter of all things bourbon, Kentucky’s “Vintage Spirits Law” took effect on January 1, 2018. In essence the new law, or more accurately revision to the existing law, allows a licensee to purchase and resell vintage spirits from an unlicensed person. In short, that means anyone can sell vintage spirits in Kentucky, and anyone can purchase vintage spirits in Kentucky - though unlicensed people are still restricted from transacting business directly with one another - a licensee still has to serve as the middleman. Licensees include both retail and bar establishments as long as they hold the appropriate license.

According to Kentucky’s Alcohol Beverage Control:

“A person holding a license to sell distilled spirits by the drink or by the package at retail may sell vintage distilled spirits purchased from a nonlicensed person upon written notice to the department in accordance with administrative regulations promulgated by the department.”

It goes on to say:

“Effective January 1, 2018, a retail licensee selling vintage distilled spirits purchased from a non-licensed person must give the Department prior written notice of the proposed retail drink or package sale, which includes the following information: (1) name and address of seller; (2) the quantity and name of the alcohol product being sold; (3) the date of the sale; and (4) name and license number of retail licensee. This notice shall be provided via electronic mail to the following email address:”

While the law is not limited to bourbon, it’s not unreasonable to speculate that bourbon and whiskey were at the forefront of the vision for the effects of this law change. Moreover, it also raises questions that are still left undefined.

What does “vintage” mean?

Is 2016 George T. Stagg considered vintage because it is no longer available? What about Elijah Craig Barrel Proof Batch B517? Is this limited to just really really old spirits, or those that are not available for distribution in Kentucky? Will Kentucky's government decide and enforce what is vintage, or will it simply be left to interested parties to duke it out in court.

As of this writing the first few transactions are on the books:

What happens if a vintage spirit is bought and sold and turns out to be fake...or worse? What’s the extent of the retailer’s liability? What about the original seller? Who did he buy it from?

Washington D.C. has proven unrestrictive spirits laws can have a major positive effect on the experience of tourists and recreation seekers. D.C. laws allow bars to bypass wholesalers and buy directly from spirits producers. If you’ve ever visited Jack Rose in D.C., you get it.

What’s most interesting about this law is the potential it has. Assuming the term “vintage” is more loosely defined than just really really old spirits (and will be in practice), this opens up an avenue for spirits, notably bourbon, to change hands more easily in an open and legal marketplace.

But if you follow bourbon closely, you already know that the secondary market is alive and well.

Is it though? In reality, what percentage of potential bottles ever make their way into the current secondary market based it being limited to mostly underground transactions? We hypothesized asolution to the secondary market, and while it’s not exactly what the Kentucky lawmakers have passed, it could accomplish much of the same thing our concept illustrated. With the new law, what’s to stop retailers from becoming sourcing agents - intermediaries merely connecting unlicensed buyers and sellers simply taking a transaction fee in between? What’s to stop the secondary market from opening right up?

So...will you be bringing some vintage spirits with you on your next trip to Kentucky?

We discussed “Vintage Spirits Law” in our latest Bourbon Community Roundtable hosted by Bourbon Pursuit. Listen here.

Written By: Nick Beiter

November 6, 2018
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Kentucky Spirits Law: Now What?
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