Michigan’s craft beverage industry has exploded over the past decade, and nowhere is that more evident than in the craft beer scene. Michigan is consistently ranked among the top states in the country for craft breweries. With that growth has come increased regulatory complexity — particularly around the rules governing what breweries can sell, and how. Two areas where Michigan’s liquor licensing law intersects with the state’s evolving small business and agriculture landscape are growler sales and wine sales at farmers markets. Both have been subjects of legislative change in recent years, and the current rules reflect a careful balance of interests among producers, retailers, distributors, and regulators.
Michigan’s Three-Tier System and Its Exceptions
Michigan, like all states, regulates the manufacture, distribution, and sale of alcohol through a three-tier system: producers (breweries, wineries, distilleries) occupy the first tier; distributors or wholesalers occupy the second; and retailers — bars, restaurants, and stores — occupy the third. The Michigan Liquor Control Code, MCL § 436.1101 et seq., governs all three tiers and is administered by the Michigan Liquor Control Commission (MLCC). The three-tier system is designed to prevent tied-house arrangements, ensure tax collection, and regulate market access. Exceptions to the separation of tiers require explicit statutory authorization.
Growlers Under Michigan Law
A “growler” is a refillable container — typically a 32 oz. or 64 oz. glass, plastic, or metal vessel — used to take draft beer from a brewery or taproom for consumption elsewhere. Growler fills became a significant revenue source for Michigan craft breweries as their taproom sales grew. Michigan law allows licensed breweries to sell growler fills to consumers directly from their licensed premises under their microbrewer or brewpub licenses. The rules governing these sales are found in the Liquor Control Code and related MLCC rules promulgated under MCL § 436.2101.
Key rules for growler sales in Michigan include:
- Sales must occur at the licensed brewery premises
- The beer sold must be the licensee’s own beer — a brewery cannot fill a growler with another producer’s beer unless it also holds a retail license authorizing such sales
- Containers must be properly sealed and labeled
- Growler fills for off-premises consumption count toward production limits for some license categories
- Retailers with beer and wine licenses can sell growlers filled with beer purchased from a distributor, subject to their license conditions
Michigan has expanded growler rights over time through legislative amendments to the Liquor Control Code. The 2010 and 2014 legislative sessions brought significant changes that allowed more license types to participate in growler sales and expanded the categories of beverages that could be sold in refillable containers. Breweries considering growler sales should verify the current MLCC rules applicable to their specific license type, as requirements differ between microbrewer, brewpub, brewer, and UBrew/UVinify licensees.
Wine Sales at Michigan Farmers Markets
The intersection of Michigan agriculture policy and liquor law is perhaps nowhere more interesting than at the farmers market. Michigan farmers markets are important economic and community venues — particularly in rural and semi-rural areas where wineries and vineyards operate. For years, Michigan law prohibited wine producers from selling directly to consumers at farmers markets, forcing them to sell exclusively from their licensed winery premises or through the three-tier distribution system.
Michigan amended its Liquor Control Code to allow licensed wineries to sell wine at farmers markets under specified conditions. The relevant provisions, now codified in MCL § 436.1203 and related MLCC rules, authorize licensed wineries that hold a specially endorsed farmers market license to sell their own wine — and, in some categories, other Michigan-produced wines — at licensed farmers market locations. Key requirements include:
- The winery must hold the appropriate MLCC license endorsement for farmers market sales
- Sales are limited to the winery’s own product or, in some license categories, to wine produced by other Michigan-licensed wineries
- The farmers market itself must hold an appropriate license or endorsement permitting alcohol sales on the premises
- The winery representative at the market must hold a seller’s permit
- All sales must comply with general alcohol sale requirements — no sales to minors, no sales to visibly intoxicated individuals
- Containers must be properly sealed and labeled consistent with MLCC regulations
Craft Spirits and Distillery Licenses
Michigan’s legislative expansions of craft beverage retail rights have extended beyond beer and wine to distilled spirits as well. Michigan craft distilleries holding a Class A or Class B Specially Designated Merchant (SDM) license or a distillery license may sell their products directly to consumers under specified conditions. Direct-to-consumer sales of spirits present additional regulatory complexity under federal TTB (Alcohol and Tobacco Tax and Trade Bureau) regulations as well as state law, and compliance requires careful attention to both regulatory frameworks.
MLCC Compliance and License Applications
Obtaining the right license — and maintaining compliance with the conditions attached to it — is the foundation of a compliant Michigan alcohol business. The MLCC application process requires detailed documentation of the applicant’s background, business structure, financial history, and premises. License categories differ significantly in what they permit, and applying for the wrong category can either restrict your business operations or trigger enforcement action. Common issues that arise in the application and compliance process include:
- Establishing the appropriate license category for the proposed business model
- Navigating local government approval requirements — municipalities have significant influence over MLCC applications
- Responding to MLCC compliance investigations or violation notices
- Understanding restrictions on advertising, sampling, and promotional activities
- Structuring business entities and ownership arrangements to comply with the Liquor Control Code’s ownership and control restrictions
Liquor Law Counsel for Michigan Craft Beverage Businesses
Michigan’s liquor law is detailed, frequently amended, and enforced by an active regulatory commission. Craft breweries, wineries, cideries, and distilleries that want to expand their direct-to-consumer sales, add farmers market locations, or navigate MLCC compliance issues need counsel that understands the regulatory framework and its practical application. Revision Legal works with Michigan businesses across the beverage industry spectrum on licensing, compliance, and regulatory strategy.
If you have questions about growler sales, farmers market wine licenses, or any aspect of Michigan liquor law compliance, contact Revision Legal today to speak with an attorney.
