Michigan

The Michigan Liquor Control Commission (MLCC) falls under the state Department of Licensing and Regulatory Affairs.  Michigan holds control on spirits at wholesale and licenses wholesalers for the distribution of beer and wine to retailers.

Definitions:

“Wine” means a product made by the normal alcoholic fermentation of the juice of sound, ripe grapes, or any other fruit with the usual cellar treatment, and containing not more than 21% of alcohol by volume, including cider made from apples or pears, or both, that contains at least 1/2 of 1% of alcohol by volume, or mead or honey wine made from honey, fermented fruit juices other than grapes, and mixed wine drinks.{MCL 436.1113(9)}.

“Mixed Wine Drink” means a drink or similar product marketed as a wine cooler that contains less than 7% alcohol by volume, consists of wine and plain, sparkling, or carbonated water, and contains any 1 or more of the following:
(a) Nonalcoholic beverages.
(b) Flavoring.
(c) Coloring materials.
(d) Fruit juices.
(e) Fruit adjuncts.
(f) Sugar.
(g) Carbon dioxide.
(h) Preservatives. {MCL 436.1109(9)}

Laws & Rules:

• Michigan Liquor Control Code, Administrative Rules & Related Laws Book
• Michigan Liquor Control Code (Chapter 436)
• Liquor Control Commission Regulations

Required: Yes

Name: Outstate Seller of Wine

Fee: $300, plus one-time $70 inspection fee

Expiration: April 30th of each year

An Out-of-State Seller of Wine (OSSW) license issued by the Michigan Liquor Control Commission (“Commission”) authorizes the license holder to ship wine into Michigan and sell to Michigan wholesalers. Applicants must complete and submit the “Non-Retail License” application with the following documents attached: letter of good standing, operating agreement, corporate documents and stockholders report.

Effective Nov. 21, 2019, the bonding requirement for out-of-state sellers of wine is eliminated. The Governor signed legislation (SB 320) to amend the Liquor Control Code to delete the bonding requirement on Nov. 21, 2019. SB 320 was amended to include an emergency clause making it effective upon passage.

Resources:

• Manufacturer License & Permit Application For Out-of-State Applicants
• Outstate Seller of Wine Requirements

Required: Yes

Fee: No Fee

Approval: 2-3 weeks

Expiration: Does Not Expire

Revision Required: COLA change

Suppliers must register all labels of wine prior to shipping into Michigan. This may be done through the online label registration website: https://www.lara.michigan.gov/MWPR/login. A password is required to access the on-line registration site which will be mailed along with your license. Detailed instructions are available on the Login page. You may also register your labels by submitting a copy of your COLA along with a loose label to the MLCC.

Labels registered and approved for DTC do not have to be resubmitted and approved for wholesale distribution.

Resources:

• MWPR – Product Registration Portal
• Michigan Wholesale Product Registry (MWPR) Instructions
• Beer Wine & Mixed Spirit Drink Label Registration

Franchise Law: Yes

Exclusive Territories: Required, with limited exceptions

Please review the law in its entirety and consult legal counsel prior to taking any action.

An outstate seller of wine, and a master distributor shall grant to each of its wholesalers a sales territory within which the wholesaler shall be a distributor of the specified brand or brands of the manufacturer, outstate seller of wine, or master distributor under an agreement. Outstate sellers of wines must provide their wholesaler with a written territory agreement, however, a copy of the agreement does not need to be filed with the Commission.

Except under certain conditions, beginning June 1, 2010, a supplier or master distributor is prohibited from granting the right to sell a specific brand or brands of wine to more than one wholesaler in the same sales territory. However, a supplier or master distributor may continue an agreement that was in effect on June 1, 2010, which assigned the distribution rights to more than one wholesaler for a specific brand of wine in the same sales territory.

A supplier must have “good cause” for terminating a wholesaler and comply with all applicable notice requirements. Notwithstanding any agreement and limited exceptions in MLC 436.1305, good cause shall exist for the purposes of a termination, when all of the following occur:

• There is a failure by the wholesaler to comply with a provision of the agreement which is both reasonable and of material significance to the business relationship between the wholesaler and the supplier.
• The supplier first acquired knowledge of the failure described in subdivision (a) not more than 2 years before the date notification was given.
• The wholesaler was given written notice by the supplier of failure to comply with the agreement, and afforded a reasonable opportunity to assert good faith efforts to comply with the agreement within the time limits.
• The wholesaler has been afforded 25 days in which to submit a plan of corrective action to comply with the agreement and an additional 75 days to cure such noncompliance in accordance with the plan.

Resources:

• MCL Section 436.1105
• MCL Section 436.1305
• MCL Section 436.1307
• 2021, Act No. 19, effective Aug. 23, 2021
• 2020, Act No. 114 of 2020, effective July 1, 2020

Required: Yes

Name: Wine Outstate Sellers Monthly Report

Due Date: Monthly, by the 15th

The OSSW must submit no later than the 15th of each month, an Outstate Sellers Monthly Report, for wine shipped into Michigan during the preceding calendar month. This report must be filed whether any wine shipments were made the previous month or not. A copy of each corresponding invoice for wine shipments or a computer generated report listed by wholesaler, for all wine shipments into Michigan for each month, must also be submitted.

Resources:

• Monthly Reporting Information for Outstate Sellers of Beer, Wine, or Mixed Spirit Drink Licensees
• Outstate Seller Monthly Report

Available: Yes

Fee: $35

Expiration: every three years on April 30th.

Any person employed or representing an alcoholic beverage supplier or wholesaler, who sells, delivers, promotes or otherwise assists in the sale, delivery or promotion of alcoholic liquor in this state is required to hold a Salesperson license issued by the Commission. Salesperson’s must be 18 years of age or older. Salesperson licenses are $35.00 for a three-year licensing period.

An applicant for a beer or wine related Salesperson License must submit documentation that they have successfully completed a salesperson accreditation program approved by the Commission.

Resources:

• Salesperson License Application
• Salesperson License Information
• Salesperson Accreditation Program

Self-Distribution:  Allowed with restrictions

License Name: Outstate Self-Distributor License

License Fee: $300 annual fee, $70 inspection fee

Label Registration: Required

Excise Tax: Required, must file quarterly by the 15th

Reporting: Required, must submit quarterly by the 15th

Restrictions cause the law to be unworkable for most California wineries.

Changes to the Michigan Liquor Control Code, effective Aug. 23, 2021, allow for a wine manufacturer that does not manufacture more than 50,000 gallons of wine per year to apply for an Outstate Self-Distributor License that authorizes the licensee to self-distribute wine products it has manufactured.

All wine product labels must be registered with the Commission. The licensee cannot self-distribute to retailers in a sales territory where it has granted rights to a Wholesaler licensee for the sale of any brand or brands of wine.

Common carriers CANNOT be used for self-distribution. Deliveries must be made by the licensee’s own employees using vehicles owned by the licensee.  Such employee’s must be individually licensed with a Salesperson license, unless otherwise exempt under law and  vehicles must have been issued a delivery vehicle decal by the MLCC. There is a $50 per delivery vehicle decal fee.

Resources:

• Outstate Self-Distributor License Application
• Outstate Self-Distributor Wine Tax Report (LCC-823) 
• Outstate Self-Distributor Report of Wine Sales (LCC-824) 
• Information on Changes Made Under Public Acts 16-19 of 2021

• Supplier and Distributor Laws Frequently Asked Questions
• Information on Changes Made Under Public Acts 16-19 of 2021
• Interpretive Statement as to Charitable Donations issued Aug. 17, 2021
• Manufacturer and Wholesaler Information
• MLCC FAQs
• Brief Description of All Licenses & Permits by Tiers
• Glossary of Common Terms Related To Retail Licensing
• MLC Section 436.1610 Advertising; use of unpaid social media; definitions.
• Third Party Facilitator Service License Requirements & General Information
• Information for Alcoholic Liquor To Go / For Delivery rev. 02-25-22