State Distribution Laws
Wisconsin
License Needed to Self-Distribute: Yes
Statute: Wis. Stat. § 125.29; Wis. Stat. § 125.295
Brewers in Wisconsin who brew less than 300,000 barrels per year are permitted to self-distribute. Additionally, brewpub licensees are also permitted to self-distribute up to 1,000 barrels per year.
Wholesalers who distribute beer for brewers are required to enter into a written distribution agreement with those brewers that designates their sales territory. Brewers are not allowed to grant multiple wholesalers the right to distribute the same products in the same territory.
If a wholesaler’s distribution agreement is terminated, the successor wholesaler (which may be the brewer) must compensate the terminated wholesaler for the fair market value of the terminated distribution rights. However, the terminated wholesaler is not entitled to compensation if the termination was caused by:
- The wholesaler’s fraudulent dealings with the brewer
- The wholesaler being convicted of a felony
- The wholesaler intentionally distributing outside its territory
- The wholesaler becoming insolvent, bankrupt, or otherwise assigning for the benefit of creditors
Brewers cannot terminate or not renew their distribution agreements without good cause. Good cause means the wholesaler either engaged in bad faith dealings with the brewer, or failed to comply with an essential, material, and non-discriminatory term of the distribution agreement. The brewer must also provide the wholesaler with 90 days’ written notice of the pending termination, which must describe the reasons they are terminating, and provide the wholesaler with at least 60 days to correct the problem. This cure period can be reduced to 10 days if the reason the brewer is terminating is the wholesaler’s failure to pay the brewer. A brewer does not need to provide any notice prior to termination if the wholesaler becomes insolvent, bankrupt, or otherwise makes an assignment to the benefit of creditors. If a brewer terminates its distribution agreement, the wholesaler can require the brewer repurchase its products at fair wholesale market value. The restrictions in this paragraph do not apply if the brewer has never produced more than 200,000 gallons in a year, or if the brewer’s products make up less than 5% of the wholesaler’s net revenue.
