The Western Cape Liquor Act – a barrier to transformation in the wine industry

When we applied for a liquor license for Women in Wine many years ago we had to explain to the Liquor Board that going forward a wine producer will not necessarily own land, have vineyards and make wine in their own cellar.

We had to explain that many new entrants into the wine industry including (nowadays some of these are called Black Owned Brands) will make and sell wine in a different way.

They will buy grapes from various producers; they will make wine in the cellar of a larger producer (and they may make wine in a different cellar every harvest).

The premises under their liquor license will be the office where they do the administration relating to the winemaking and wine sales. 

We also had to explain that customers will not visit the office to collect wine but, that wine will be couriered directly from the cellar where it is made or another facility where it is stored to the customer who ordered it.

It took a hearing before the Liquor Board to explain this model to them before the license was issued.

Unfortunately, when the Western Cape Liquor Act was drafted, the drafters of the Act believed that more control was required and from 2012, when the Act came into operation, the cellar which accommodated the new entrant had to notify the Liquor Authority that the wine was to be made in its cellar.

When the Western Cape Act was amended in 2017, this requirement was further expanded and it now requires that the (small) producer without a cellar apply, jointly with the (large) producer in whose cellar the wine will be made, to the Liquor Authority for approval for the small producer to make wine in the cellar.

If a small producer makes its wine in a different cellar every harvest, it means that not only did it have to apply for its micro manufacturer’s license in respect of its office – but it also has to apply for the approval in respect of each new cellar where it makes wine.

If one adds the cost involved with this application with the annual license renewal fee (which increases every year), it is becoming an increasingly expensive exercise for a small winery to comply with the Act.

When officials at the Western Cape Liquor Authority were asked about the reason for these requirements, they indicated that it was aimed at ensuring that the wine which was made was safe and not a danger to members of the public.

This is not a valid reason since the Liquor Products Act (a national Act) regulates the certification and the production (as far as safety is concerned) of all liquor products.

If the requirements are aimed at combating alcohol abuse, it does not take into account that the harms related to alcohol abuse can only occur once the liquor is consumed i.e. once it has been sold to a member of the public at a tasting room, shop, restaurant etc. The cellar where the wine is made and perhaps matured is not such a place.

The requirement in respect of the application for approval to make wine also often endangers the relationship between the small producer and the large producer with the cellar. Although many large producers are all willing to assist a small producer with winemaking, they are not amenable to providing details regarding their liquor license, photographs and plans of the cellar (which are required by the Liquor Act). They are often under the impression that such an approval will affect their own liquor license.

In its current form, these provisions of the Western Cape Liquor Act is, therefore, a barrier to entry for new entrants to the wine industry.