A new policy memo from an American alcohol retail industry group argues that marijuana should be regulated more like booze—including by requiring that intoxicating cannabis products be sold only by businesses licensed to sell alcohol.
The memo published by the American Beverage Licensees trade association this month states that “States Should Restrict the Sale of Intoxicating THC Products to Businesses Licensed to Sell Beverage Alcohol and That Are Regularly Inspected for Compliance with Laws aimed at Preventing Sales to Individuals Under 21”.
This group argues that retailers who have “many decades of demonstrated compliance are the best-positioned to sell this product.”
The two-page memo advises that regulators should treat cannabis in a similar way to alcohol. This includes licensing requirements, labeling standards, and advertising restrictions. The alcohol industry group said that it could also limit the potency of each serving.
According to the article, THC products need to be tested in a lab for potency, safety, and purity. The paper says that testing should be done to ensure the products are free of contaminants, including heavy metals and pesticides. It also recommends that THC is tested to confirm its potency and to verify it’s purity.
ABL, which represents on-premise sellers of beer, wine and spirits such as bars, taverns, restaurants and casinos, as well as off-premise retailers like package stores, is further calling for a “fair and transparent” tax structure for THC products, with production and retail tax rates “similar to those for beverage alcohol in the state.”
In order to maintain a functioning system, this memo calls for the strict enforcement of existing laws and regulations. This includes fines for violating testing and labels, selling alcohol to individuals under age, and not having a valid license.
This document also states that “states should work with insurance providers and regulatory agencies” in order to make sure that cannabis retailers can access financial services and insurance.
The memo states that “retailers of THC intoxicating products are facing unique challenges when it comes to securing financial and insurance services, due to an evolving legal environment.”
In recent years, the alcohol industry has become increasingly active in marijuana lobbying. The alcohol industry is competing with marijuana sales, which has led to an increase in lobbying.
Bloomberg Intelligence published a report in 2013 that called cannabis a “significant threat” to the industry. It cited survey data which indicated more people use cannabis as a replacement for alcoholic beverages like beer and wine.
Reports projected that the slump in sales of wines and spirits would “continue for a long time” and “largely stem” from increased consumer accessibility to “legal marijuana” and alternative products.
Analysts from BI stated that cannabis consumption is increasing and they believe the substance has replaced alcoholic beverages. We also expect that increased US consumer access will pose a serious threat to all alcohol drinks, especially beer and wine.
A beer trade group released in November a document containing guiding principles for addressing what it termed “the proliferation” of unregulated, intoxicating cannabis and hemp products. The statement warned consumers of the dangers of THC.
The Beer Institute suggested in its document that Congress imposes an excise federal tax on cannabis and hemp products “with a tax rate higher than for any product containing alcohol.”
It also urged a “zero tolerance approach” to THC and driving—a policy that could prevent casual cannabis consumers from ever being able to legally drive due to how long the drug’s metabolites stay in the body after use—and recommended keeping in place the federal ban on combining intoxicating cannabinoids and alcohol.
The statement read: “In a recent press release, American brewers, beer importers, and their CEO Brian Crawford have all demonstrated that they are committed to encouraging a culture based on moderation, responsible consumption, and compliance with taxation and regulatory systems.” The current patchwork hemp and cannabis regulations and laws do not adhere to the same standards as the beer industry.
Earlier this year, Wine and Spirits Wholesalers of America called for Congress to establish a framework of regulation that would allow hemp-based cannabinoids, which are intoxicating, rather than impose a ban outright, as it was proposed.
The Alcohol Trade Association said: “We are strongly in favor of clear federal regulations and rules that clearly define the hemp compounds which cause intoxication and give states authority to regulate them within their own borders.”
Growing evidence suggests that frequent marijuana use is now more common among Americans than regular alcohol use. Recent research found that Americans drink more alcohol than cannabis on a daily base. The rate of cannabis consumption per person in America has nearly increased 15-fold since 1992.
According to a report published in 2023 by a multi-national investment bank, marijuana will also be a formidable competitor for alcohol. The bank projects that 20 million people more are expected to regularly use cannabis during the next five year period as alcohol loses two million drinkers. The report said marijuana sales will reach $37billion in the U.S. by 2027 as new state markets open.
A separate study out of Canada, where marijuana is federally legal, found that legalization was “associated with a decline in beer sales,” suggesting a substitution effect.
Data from a Gallup survey published in August of last year also found that Americans consider marijuana to be less harmful than alcohol, cigarettes, vapes and other tobacco products.
An expert in the hemp industry told Congressmen earlier this month that federal regulations on cannabis products were “begging”.
Rep. James Comer asked if “a gazillion home-based bureaucrats” would be needed to oversee cannabinoids, such as CBD, at the hearing.
In the absence of FDA rules, states from California to Florida have pushed for sweeping changes to their own laws around consumable hemp products. The focus of attention has been on products that are intoxicating, but CBD-based businesses which are federally legal have become increasingly targeted.
Meanwhile, as lawmakers prepare to once again take up large-scale agriculture legislation this session, congressional researchers in January provided an overview of the policy landscape around hemp—emphasizing the divides around various cannabis-related proposals among legislators, stakeholders and advocates.
Senate Democrats released the long-awaited draft of 2024 Farm Bill last year that contained several proposed changes to federal hemp laws—including provisions to amend how the legal limit of THC is measured and reducing regulatory barriers for farmers who grow the crop for grain or fiber. Some stakeholders were concerned that this legislation would “eliminate” a range of current products.
The hemp industry is currently facing unique regulatory obstacles that are blamed by stakeholders for the rapid decline in value of the crop since it was legalized. Despite the economic conditions, however, a recent report found that the hemp market in 2022 was larger than all state marijuana markets, and it roughly equaled sales for craft beer nationally.
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