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When customers walk into their local bar or their favorite restaurant, they will undoubtedly notice the various ads and promotional materials featuring assorted alcohols and other related products. These include everything from the neon signs and posters on the walls to the coasters and napkin holders on the tables and even the glass that their drink of choice is served in.

Most people fleetingly acknowledge the illuminated sign with the popular pirate as a barroom staple, quickly putting out of their mind. What most customers don’t realize is that the presence and placement of these materials is regulated by the Ohio Department of Commerce’s Division of Liquor Control, which is also responsible for controlling the manufacture, distribution, licensing, regulation, and merchandising of beer, wine, mixed beverages, and spirituous liquor as outlined by Ohio Revised Code Chapters 4301. and 4303.

What Does the Law Say About Giving Away Glassware to Bars in Ohio?

In addition to the voluminous regulations about licensing and how alcohol is served in Ohio, the Revised Code also governs how distributors and manufacturers promote and advertise their products, especially within a permit holder’s establishment. Most of these are common sense protocols about what can be given away or accepted; meant to ensure proper taxation, but also avoid to unfair competition and facilitate a transparent, accountable and stable industry.

While the goal of the law is to foster a fair marketplace, there has recently been a push to change a very specific, seemingly innocuous rule concerning glassware that could place some smaller companies at a serious disadvantage. Currently, Rule 4301:1- 43(B)(2) states:

“no manufacturer or supplier shall furnish to an individual retail permit holder more than twenty-five dollars worth of glassware or other containers intended for the serving of alcoholic beverages at one time, and shall not furnish glassware to an individual retail permit holder more than twice per year.”

Why Is This Important?

On its face, this may sound like an arbitrary limitation. For members of the industry, it is an important protection. Think about it this way: while a typical customer may briefly see the neon sign and recognize it as part of the bar’s ambiance, it is easily drowned out. On the other hand, a more tangible and ever-present advertisement is the glass they are holding, usually emblazoned with a company’s logo.

It is hard to ignore the glass, physically in a customer’s hand and companies know this, which is why larger manufacturers are pushing to do away with the annual limitation and dollar amount. If the rule changes, large distributors and manufacturers can essentially flood retailers with their promotional glassware, thereby hindering small breweries and independents.

Smaller entities like Land-Grant Brewing Company, Seventh Son, BrewDog, Rhinegeist, and Kindred, to name a few, have grown in popularity and market share in Ohio recently, but they likely won’t be able to compete with the likes of Anheuser Busch or MillerCoors and their marketing budgets. The corporate resources at their disposal could allow them to supply retail establishments with virtually unlimited glassware. Additionally, the retail establishments would be hard-pressed to refuse such offerings, since glassware, regardless of the source, represents a significant expense.

Is the Current Law Changing?

There does not seem to be a clear path forward or firm proposal from any of the stakeholders. There was some recent back-and-forth with the interested parties regarding changing the limit from a dollar amount to a set number of cases of glassware, and while a few proposals have been suggested, nothing has been amended at this time.

To change the current guideline regarding giving away glassware to bars in Ohio, the legislature seems to be leaning towards a statutory fix, which means amending RC 4301.03, 4301.22, or 4301.24. Such an amendment could be placed into any piece of legislation that seems to be moving, and House Bill 522 seemed to be the most practical vehicle. However, with HB 522 passing out of committee last week with unanimous support from the Senate, an amendment seems unlikely at this time.

At least for now, it does appear that changing the glassware provision of Rule 4301:1- 43 won’t be an issue during the current General Assembly. But with the financial interests involved, this topic is probably far from over. It’s understandable why larger companies are interested in maximizing their foothold, and we certainly appreciate the concerns of Ohio’s smaller distributors and manufacturers. Our Ohio government affairs and lobbying lawyers will continue to monitor this issue.

Contact a Government Relations Lawyer

Located in Columbus, Ohio, Graff & McGovern, LPA is a well-regarded and highly effective government relations law firm. Whether you or an organization that you represent wishes to seek a license, change a law or policy, defend against government action, amend an administrative rule or regulation, or navigate government bureaucracy, we have the knowledge, relationships, and experience necessary to affect real change.

To schedule a consultation, call 614-228-5800 or submit a request online.