Alcohol Licensing in Alabama – A Peek Behind the Curtain

Until the last couple of years, servers in Utah restaurants had to hide behind “Zion Curtains” to pour drinks. These barriers were intended to protect children and teetotalers from the temptations of drinking. Fortunately, Alabama alcohol laws aren’t nearly as strict—but try telling that to our restaurant and brewery clients. They know the sale of alcohol in Alabama is highly regulated and, as with most regulated industries, the laws can be tricky.

The Alabama Code dedicates an entire chapter, Title 28, to enforce the production, distribution, and sale of alcoholic beverages in Alabama. The Alabama Alcoholic Beverage Control Board (the “ABC”) was created to enforce state alcohol laws. As if Title 28 wasn’t enough, the ABC also has its own set of rules and regulations that every licensee must follow. The ABC is free to adopt any such regulation it deems necessary, so long as it doesn’t conflict with Title 28.

Alabama case law has held that a license to serve alcoholic beverages is a privilege rather than a right. Krupp Oil Co. v. Yeargan, 665 So. 2d 920, 925 (Ala. 1995). The ABC has full authority to suspend a license if the licensee has not complied with Title 28 and all ABC rules and regulations. Alabama breweries are especially aware of the strict recordkeeping and reporting requirements of the ABC. The ABC can audit a licensee’s records at any time.

Alabama is similar to other states in that it implemented the “three-tier system” of alcohol distribution laws following the repeal of Prohibition in 1933. This distribution model requires manufacturers of alcoholic beverages (typically breweries, distilleries, and wineries) to sell to distributors who, in turn, sell to retailers such as restaurants, bars, and grocery stores. More recently, in 2011, the legislature passed a law relaxing some of the outdated restrictions prohibiting breweries and distilleries. This new law allowed manufacturers to sell their products directly to the consumer to drink on the premises—in other words, you could drink beer at a brewery. Shortly thereafter, breweries began to pop-up all-over Alabama. Distilleries are beginning to follow suit, albeit more slowly.

You don’t need to look behind a Zion Curtain to find an adult beverage in Alabama, but alcohol laws can pose significant hurdles for breweries, restaurants, and bars. Many of those laws are based on notions that seem archaic by today’s standards, but licensees must comply with Title 28 and ABC Rules and Regulations if they want to serve alcohol in Alabama.    

Jay Smith

Jay Smith

Jay provides general counsel to many local businesses—including breweries, restaurants, and bars. He assists clients by navigating licensing and regulation issues, employment questions, contract disputes, and other matters that commonly arise in business ownership.

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