During the first week of 2020 Maryland enacted one of its resolutions for the new year: The Beer Franchise Law.[1] The thought of a new year is usually accompanied with a fresh start, freedom and a happier life. The Beer Franchise Law will make these thoughts a reality for beer brewers, but not necessarily wholesalers of alcohol.[2]

Traditionally in Maryland, a brewery had to give a significant amount of notice to wholesalers if the brewery wanted to terminate a contract with the wholesaler. Under old law, breweries had to give 180 days of notice to a wholesaler if the brewery wanted to terminate a contract.[3] However, with the Beer Franchise Law, breweries now only have to give a wholesaler 45 days’ notice.[4]

Maryland has adopted most of the provisions of the model Uniform Commercial Code, which Maryland calls “Annotated Code of Maryland: Commercial Law Article”. This code governs the transactions among businesses.

As a whole, the Uniform Commercial Code seeks to make transactions between businesses easier and more efficient. Seeing as Maryland adopted these policy considerations when creating its commercial code, it makes sense that Maryland has decided to put the Beer Franchise Law into effect. The Beer Franchise Law gives more power to local breweries than they have had in the past when trying to terminate a contract with a wholesaler.[5]

This shorter notice timeline is in line with the spirit of Maryland’s commercial code: to not only make transactions between businesses more efficient, but also to make them easier. Requiring 45 days notice to wholesalers, rather than 180 days, will make it easier for a brewery to leave a contract, and thus likely more efficient for the business. If a business is trying to change their wholesaler supplier, it is likely because it is a better match for the business. Therefore, this shorter deadline will also likely increase breweries financial health, which can lead to a favorable spike in Maryland’s economy.

Not only is the Beer Franchise Law reflective of the policy goals behind Maryland’s commercial code, but it is also reflective of the modern-day Maryland community. Breweries have become a “trendy” and entertaining way for consumers to spend afternoons or evenings. People have become interested in the experience of tasting locally-made beer while supporting local businesses, instead of national ones. The Beer Franchise Law is in line with this trend as it gives more power to breweries, than corporate wholesalers.[6] Additionally, the significant decrease in the notice requirement a brewery must give to a wholesaler, protects small breweries from being “stuck” in a contract that is hard to get out of with a more financially powerful wholesaler.

The Beer Franchise Law is only one example of how consumer trends can lead to more protection for the business the consumer is interested in. The new law naturally fits into the lifestyle of Marylanders, and also aligns with the policies Maryland commercial law seeks to uphold. Cheers!

Kelli Kiffer is a third- year law student at the University of Baltimore School of Law who is an Ohio transplant. During her time at UB, she was involved in University of Baltimore Students for Public Interest (UBSPI), If/When/How, and Law Forum. Kelli will continue to pursue her passion for public interest beginning January 2021, as a Public Defender in Baltimore City in the misdemeanor division.

[1] Start of New Year Marks Beginning of New Laws in Maryland, WBALTV, https://www.wbaltv.com/article/2020-marks-beginning-of-new-laws-in-maryland/30370828#.

[2] Id.

[3] Id.

[4] Id.

[5] Id.

[6] Id.