Laws and Regulations to Consider Before Starting an Online Liquor Store
Online alcohol shops are increasing in popularity. The recent pandemic and the resulting lockdowns separated people from bars, leading to increased growth of online alcohol ordering. ISWR Drink Market Analysis report states that online alcohol ordering almost doubled from 2019 to 2020. And it’s not just for that year alone. Statista predicts that the online alcohol market will grow more than twofold between 2020 to 2025.
People are always looking for a convenient way to order alcohol, especially since it’s easy to do so over the internet. However, these stores need to be aware of the laws and regulations that must be followed. This article will discuss some of the most important ones you should be mindful of.
Must Register With TTB
In the United States, all online alcohol shops must register with the Alcohol and Tobacco Tax and Trade Bureau. This federal agency was created in 2003 to regulate the alcohol industry. The bureau has been tasked with enforcing federal laws requiring all alcohol dealers to be registered.
To register, an online alcohol shop must provide their name, address, and information about their products. They also need to let the bureau know if they’re selling tobacco products or have employees under 21 years of age.
Once approved, an online alcohol dealer will receive an ID number from the bureau, which they can use to show customers that they are legally allowed to sell alcohol in their state.
Prevention of Selling to Minors
The laws regarding online alcohol shops are stringent. Many people don’t know that it’s against the law to sell alcohol to minors, and it’s also against the law for children to buy alcohol.
In fact, many states have laws that make it illegal for anyone under 21 years old to possess or consume alcohol. These laws are designed not just to prevent people from drinking underage but also from getting into accidents while under the influence of alcohol.
Some states have stricter laws than others regarding online alcohol shops, but they all have one thing in common: they make it illegal for anyone under 21 years old to buy alcohol online or possess it in any way (even if you’re not drinking).
However, a study from the University of North Carolina states that minors can easily evade age restrictions to purchase alcohol online. This is because the minors don’t have to come face-to-face to anyone to buy online. While the children are trying to get alcohol, the online sellers need to prevent this from happening with the help of technology.
One of the most efficient technologies that can help with this is Age Verification-as-a-Service. This service works by matching ID card details with a real-time customer image to verify the age. The verification process is straightforward:
- The consumer receives a request for age verification
- He or she uploads the image of a government ID
- The customer then takes a selfie and uploads it
- The age is verified
With the help of an age verification service, online sellers can protect their business from risks due to minors trying to buy alcohol.
Refilling, Reusing, and Disposing of Bottles
If you’re an online alcohol shop, you must be aware of the laws regarding refilling, reusing, and disposing of alcohol bottles.
- Refilling: Refillable containers are allowed for sale in all 50 states. However, you must label each container with the words “REFILLABLE” or “REFILL ONLY.” It should also be noted that refilling can only occur at your store or location. You cannot ship refilled products to customers.
- Reusing: Reusable containers are not allowed for sale in any state. These include plastic bags, glass bottles, or any other reusable container that could be used for storing alcoholic beverages.
- Disposing: Disposable containers must be disposed of properly after use by consumers. Store owners must ensure disposable containers are thrown away to prevent them from being used as drinking receptacles by minors or other people who may not legally consume alcoholic beverages.
Following these guidelines is beneficial not only for you and the customers but also for sustainability. You can also motivate the customers to send the bottles back to you so that you can handle them efficiently. You can do this with the help of a reward system.
You can install cans where people can throw their used bottles. Whenever a customer sends you a bottle back, you can give him or her a reward point. After some reward points, you can give them a complimentary bottle of beer in exchange for the points.
State-Specific Laws and Regulations
Alcohol laws in the United States vary from state to state. You must know your local laws before shipping alcohol. In some states, it is illegal to buy or ship alcohol online. In other states, there are restrictions on how much you can order or ship at one time. Some states also have age limits on who can order alcohol.
Here are some state laws for alcohol delivery.
- Alabama: In Alabama, only the sellers registered with the Alcohol Beverage Control Board can deliver alcohol in a minimal quantity. The state did not allow delivery until March 2020. However, with Covid-19 restrictions, there was an allowance, which was pulled back in September 2020. However, the current law, signed in October 2021, allows registered bodies to deliver small quantities through employees or contractors.
- California: California allows the shipment of up to nine-liter cases of alcohol per month to any adult resident. However, the shipment should be clearly labeled. Additionally, the shipper should be registered with the state government.
- Hawaii: Hawaii allows shipping liquor directly to the customers but only with a permit for individual shipment. Also, a single shipment cannot be more than 5 gallons.
Similarly, there are different rules about shipping alcohol in different states. As an online alcohol seller, you need to be aware of these laws to prevent your business from getting into legal trouble.
There are numerous laws and regulations that online alcohol sellers should be aware of. Failure to comply with these laws and regulations can lead to undesirable and potentially dangerous consequences.
If you’re planning on selling alcohol online, do yourself a favor and ensure you understand the laws and regulations that apply to your situation.