Liquor Industry News 5-16-13

Franklin Liquors


Thursday May 16th 2013



Drunk driving: Why is MADD among critics of lower alcohol limit?


The National Transportation Safety Board is proposing that the legal limit for a driver’s blood-alcohol content be reduced from 0.08 to 0.05. Critics say it’s the wrong focus for anti-drunk driving efforts.


Source: Christian Science Monitor

By Ryan Lenora Brown

May 15, 2013


On its surface, the recommendation seems simple: reduce the legal limit for blood-alcohol content (BAC), and drunken-driving fatalities will fall, too.


But nearly as soon as the National Transportation Safety Board (NTSB) made that proposal Tuesday, a chorus of dissent began. Lower the BAC limit, critics argued, and you criminalize responsible social drinkers – and do little to make the roads safer.


And the opposition came from some unlikely corners.


“As a mother whose daughter was killed by a drunk driver, the most important thing to me is that we save as many lives as we can as soon as possible,” says Jan Withers, president of Mothers Against Drunk Driving (MADD). “The issue with lowering the legal limit is that it will take a lot of effort for a potential result that is many, many years down the line.”


While MADD doesn’t oppose the idea of lowering the legal limit in principle, it’s the wrong place for the government to focus its efforts against drunken driving now, she says. It’s a critique mirrored by many involved with drunken-driving policy issues.


The NTSB is proposing that the legal limit for BAC be reduced from its current level of 0.08 to 0.05.


There’s no neat correlation between blood-alcohol level and drinks consumed, but in general, a 140-pound person could consume three drinks and fall below the 0.08 ceiling, and a 180-pound person four. But if the limit were set at 0.05, that would drop to two drinks or less for the smaller person and three for the larger.


“The fact is, many alcohol-involved traffic incidents aren’t caused by alcoholics, but just people who had one too many, and lowering the legal limit helps deter those people,” says Thomas Babor, an expert on alcohol abuse at the University of Connecticut’s medical school in Farmington.


Indeed, both supporters and critics of the NTSB recommendation agree on that point: Drunken drivers shouldn’t be on the road. But how you make that happen is a sticking point.


According to the NTSB, a driver with a BAC of 0.05 is 38 percent more likely to be in a crash as compared with a completely sober driver, and a driver with a level of 0.08 is 169 percent more likely. (The figure rises to nearly 400 percent when the driver has a BAC of 0.10.)


At 0.05, individuals are “as distracted as you are when you have the radio up too loud,” says Sarah Longwell, managing director of the American Beverage Institute, a trade organization.


“This would have a devastating impact on the hospitality industry while having no corollary benefit for public safety,” she says.


Instead, she says, the government should focus its efforts on the “hard-core drunk drivers” responsible for the majority of alcohol-linked road deaths. That means better education around drinking and driving and a focus on technologies like the ignition interlock, a small device like a breathalyzer installed on a car’s dashboard that forces the driver to demonstrate sobriety before he or she can start the vehicle.


MADD supports many of these efforts, too, and says government needs to redouble its efforts to enforce the laws it already has in place to stop impaired driving.


Since the 1980s, organizations like MADD have successfully launched public-awareness campaigns that have stigmatized drunken driving and led to more-stringent limits across the country.


Consequently, crashes with alcohol-impaired drivers plunged more than 50 percent – from 21,113 in 1983 to 9,878 in 2011 – and the proportion of highway fatalities resulting from crashes with a drunken driver fell from half to a third.


But now, such statistics are plateauing, the NTSB says.


“Most Americans think that we’ve solved the problem of impaired driving, but in fact, it’s still a national epidemic,” said NTSB chair Deborah Hersman in a statement. “On average, every hour one person is killed and 20 more are injured.”


Reducing the legal limit, the agency argues, would also better align the United States with the global consensus on impaired driving. More than 100 countries already have BAC limits at 0.05 or below, the NTSB says, including 25 of the 27 members of the European Union. Several nations, including Russia, Brazil, Hungary, and Nepal, have a legal limit of zero, and a host set the standard at 0.02 or 0.03, according to the International Center for Alcohol Policies.


The NTSB does not make law: It can only make recommendations to the states and federal government. It is likely to continue facing stiff opposition. Still, Dr. Babor says, this is something the group should fight for.


“The National Transportation Safety Board wouldn’t have recommended this unless there was overwhelming evidence that it would help,” he says.




Restaurants Slam Bid to Fortify Drunk-Driving Rules


Source: WSJ


May 15th


Restaurant groups on Wednesday criticized a recommendation that states adopt a stricter threshold for legal blood-alcohol levels in automobile drivers, arguing that such a move would hurt the industry without significantly improving safety.


The National Transportation Safety Board had urged states Tuesday to set their legally permitted blood-alcohol-content levels at 0.05%. The board said that research shows most drivers at that level experience a decline in cognitive and visual functions that significantly increases the risk of a serious crash. All U.S. states have a 0.08% limit for noncommercial drivers over the age of 21.


“We feel measures addressing drunk driving should be focused on repeat, chronic offenders who drink excessively then drive, and not the millions of Americans who enjoy an adult beverage in a responsible manner with their meal,” the National Restaurant Association said.


The American Beverage Institute, another trade organization made up of 8,000 restaurant chains that serve alcohol, said the average blood-alcohol level in fatal crashes is twice the current legal limit, while fewer than 1% of highway deaths occur between 0.05% and 0.08%.


The institute said a better approach would be to tighten regulations on repeat offenders and those convicted of driving with higher blood alcohol levels.


Sarah Longwell, the group’s managing director, said the NTSB’s recommended change would affect more than just alcohol sales. “Alcohol is a profit center for restaurants, but it also enhances the food. It’s part of the dining culture to have drinks that complement your meal,” she said.


Alcoholic beverages tend to be among the most profitable items on restaurant menus, but the share of sales at U.S. restaurants from alcoholic beverages has declined over the past decade as alcohol-related laws and penalties have become stricter and consumers’ tastes have changed.


Big chains like Applebee’s, a unit of DineEquity Inc., DIN 0.00% and Olive Garden, owned by Darden Restaurants Inc., DRI +0.28% have been trying to reinvigorate their bar businesses, adding larger bar areas with high-top tables to encourage mingling, hiring mixologists to come up with signature cocktails and recommending wine pairings with entrees.


Applebee’s share of sales from alcohol rose to 14.5% this year from 12.5% when DineEquity bought the chain in 2007. The improvement came from focusing more on late-night business and encouraging customers to order a second round. Brinker International Inc. EAT +0.40% has also increased alcohol sales at its Chili’s Grill & Bar unit from an internal initiative called “Raising the Bar.”


Red Robin Gourmet Burgers Inc. RRGB +0.26% estimates that increasing its share of sales from alcohol by half a percentage point in a year represents about $3 million in profit, before interest, taxes, depreciation and amortization. At the end of 2012, alcohol represented 7.3% of its total sales, up 0.7 percentage point from the prior year.


Representatives for the restaurant chains referred requests for comment on the NTSB’s recommendation to their trade associations.


The NTSB can’t change the drinking and driving laws, but its guidance on transportation-safety issues often results in eventual policy changes. Blood-alcohol limits are determined at the state level, and changes can take decades to be adopted nationwide.


When the National Highway Traffic Safety Administration began pushing states to lower their BAC limits to the current 0.08% level, it at first offered incentives and eventually started enforcing penalties for states that didn’t comply. It took more than 20 years to get all 50 states on board.


Lowering the blood-alcohol level hasn’t been a focus of some major anti-drunk driving groups. Mothers Against Drunk Driving issued a statement Tuesday lauding the NTSB’s effort to call attention to the issue and reiterating that the safest practice is to avoid drinking and driving altogether. But MADD said its focus remains on other measures it has recommended, such as requiring ignition-locking devices to prevent convicted drunk drivers from operating vehicles after drinking.


The 0.05% cap could translate to a limit of two drinks over a typical dinner for an average-sized male, or perhaps a single serving for a smaller female, said Todd Hooper, a restaurant and retail strategist at consulting-firm Kurt Salmon. “Buying by the bottle would become very tricky unless you had four or more people at the table.”


Still, he said, any impact on the industry is likely to take time, because even if the recommendation becomes law, consumers will take a while to change their behavior. “It could take a full generation to kick in,” Mr. Hooper said.




Fight Brews In Washington Between Craft Brewers And Big Beer Over Tax Breaks


Source: US News and World Reports

By Elizabeth Flock

May 15, 2013


This week in the world of obscure holidays is “American Craft Beer Week,” which celebrates small and independent brewers like Dogfish Head and DC Brau. Tuesday, meanwhile, was “Brewers’ Day,” a day designed mostly for bigger beer companies, such as Anheuser-Busch and MillerCoors.


Both holidays are being used by brewers big and small to inundate Washington with a single message: we need a tax break.


But big beer and craft brewers don’t always see eye-to-eye, so they’re asking for different tax breaks in different ways.


Big beer is pushing legislation called the BEER Act, which would drop the federal excise tax for large brewers from $18/barrel to $9. The bill was introduced in the House of Representatives last week, and the Beer Institute, the main trade association group for large-scale brewers, tells Whispers companion legislation could drop in the Senate as early as Wednesday.


Craft brewers, meanwhile, are pushing for passage of their own bill, the Small BREW Act, which would redefine what makes a brewer “small,” as well as reduce the federal excise tax from $7/barrel to $3.50 on the first 60,000 barrels a small brewer produces.


And both groups are angling for Congress’s attention by bringing in the brewers themselves. On Brewers’ Day, the Beer Institute flew in executives from Anheuser-Busch, MillerCoors and Heineken USA among others to petition lawmakers to support the BEER Act. The Brewers Association, which represents craft brewers, will bring 10 craft brewers to Washington Thursday to meet with senators on the Democratic Senate Steering and Outreach Committee, a committee that liaisons between advocacy groups and the Senate, to push for passage of the Small BREW Act.


The dueling pushes aren’t happening without some sharp elbows from both sides.


“We would never oppose [the BEER Act] because there is a lot of good stuff in that bill for our members,” says Brewers Association COO Bob Pease, but then noted the taxpayer cost of the BEER Act would be significantly higher than the Small BREW Act. “We see our bill as a jobs creator, because when craft brewers expand production they hire people… whereas we don’t necessarily think that the large brewers would [do that], so we don’t really that bill as a jobs creation bill.”


The Beer Institute, meanwhile, has said it will “actively oppose” the Small BREW Act.




United Spirits Shareholders Ignore Diageo Open Offer


Source: WSJ

By Ashutosh Joshi

May 15th


Diageo PLC DGE.LN -0.46%received just a fraction of the shares it had offered to buy in India’s United Spirits from public shareholders as the offer price was significantly lower than the stock’s market value.


The U.K. alcohol giant offered to buy a 26% stake, or 38 million shares, for 1,440 rupees ($26) a share from the Indian spirits maker’s public shareholders between April 10 and April 26. But the stock’s price rose well beyond the offer price as investors expected Diageo to sweeten the offer.


JM Financial Institutional Securities Pvt. Ltd., which managed the offer, Wednesday said just 64,169 shares were tendered to the offer, of which 58,668 were accepted.


The open offer was part of Diageo’s $2 billion deal struck in November to buy up to a 53.4% stake in the Indian company. The deal included buying a 27.4% stake from United Spirits Chairman Vijay Mallya, a few companies controlled by him and in new shares.

Under Indian rules, any merger and acquisition involving more than a 25% stake requires the acquirer to make an open offer for at least a 26% stake in the target company. Diageo’s offer was to primarily meet this condition.


Shares of United Spirits gained nearly 70% since the announcement of the deal on Nov. 9 to trade at 2,303.75 rupees on the Bombay Stock Exchange Wednesday.


Analysts said they were expecting the open offer to fail.


“The offer was not going to succeed. This is on expected lines,” said V. Srinivasan, an analyst with Mumbai-based Angel Broking.


Mr. Srinivasan said Diageo could increase its stake in United Spirits gradually by buying shares on the open market.


Diageo executives didn’t respond to queries. A spokesman for the UB Group 507458.BY +0.21%, which controls United Spirits, declined to comment.


Diageo had earlier said that it won’t raise the price and also indicated that it would be happy with a smaller stake in United Spirits to begin with, as long as it gets some management control.




World Whiskies Awards 2013 Winners Announced – George T. Stagg Named World’s Best North American Whiskey


Source: Buffalo Trace Distillery

May 14th


The whiskeys from Buffalo Trace Distillery were honored at the World Whiskies Awards, sponsored by Whisky Magazine.  The event took place in London in March and featured more than 300 whiskies battling it out during three intensive blind tasting rounds, seeking the coveted title of “2013 World’s Best Whiskies.”


Buffalo Trace Distillery had three whiskeys winning top honors, most notably George T. Stagg, which won the top honor of “World’s Best North American Whiskey.”  In addition, Stagg was named “Best Bourbon American Whiskey” and “Best Bourbon American Whiskey 8 Years and Over.”


George T. Stagg was described by Whisky Magazine editor Rob Allanson as, “Big and bold, mouth coating with toffee and caramel notes. The oak is here too bringing spices and soft cream pastries.Nothing small about this, but it is all in balance.”


Buffalo Trace’s Colonel E. H. Taylor, Jr. Straight Rye was named “Best Rye American Whiskey No Age Statement” and Sazerac Straight Rye was named “Best Rye American Whiskey 7 Years and Under.”

For a complete list of winners, check out:




European Beverages – Industry update, Feedback from Canadean beer conference


Source: Nomura

May 16, 2013


European Beverages

Sector View: Bearish

Ian Shackleton – NIplc


Canadean International Beer strategy conference feedback

We have just attended the Canadean International Beer Strategy conference in Prague. This included presentations by several major beer companies (including Molson Coors, Heineken, Carlsberg) as well as by many suppliers and by Canadean itself which provides data on global beer.


Growth of craft beer – opportunity and threat

The overall theme from the Canadean conference is that the growth of craft represents both an opportunity (especially for small brewers) as well as a threat (especially for the larger players), not just in the US but in most mature markets. We see a key challenge for global brewers is to get to grips with a “small is beautiful” approach after many years of focus on efficiency gains from scale. In several presentations, Molson Coors (rated Buy) was cited as a beer company which is managing this conflict relatively well; with the C Europe deal delivering well and a low valuation, we see further rerating opportunity ahead of the investor day in June. In addition, with its strong focus on local brands, as well as some global brands, we see Carlsberg (Buy) also in a strong position to weather the storm.


Cider – significant growth opportunity

Elsewhere we retain our enthusiasm for cider, which has many commonalities with craft, despite the need for more global definitions, and we retain our Buy rating on C&C.


Diageo – preferred stock within the spirits space

Diageo’s presentation on Africa reminded us of the company’s wide exposure to emerging markets and of the strong potential for leveraging beer and spirits in Africa in particular. Whilst we remain concerned about the China slowdown for spirits, Diageo (Buy) remains our preferred spirits company because of its relatively small profit exposure here.




Commentary: Takeaways from The Boston Beer Company (SAM, Sell) at the GS Consumer Products Symposium  


Source: Goldman Sachs

By Judy E. Hong , Michael Luddy and Jacob Feinstein

14 May 2013


Main Takeaway: SAM continues to be optimistic about the outlook for the better beer category, with the craft beer category on track for 13% growth this year. However, the proliferation of craft brands in the marketplace (2 new craft breweries are being opened per day) is likely to reach a critical point in the next 1-2 years as both distributors and retailers face space constraints. SAM expects to grow volumes in the craft category, but is no longer targeting share gains. SAM continues to enjoy growth from its Angry Orchard and Twisted Tea brands.


Key Points:


Better beer is driving the US profit pool – The “better beer” profit growth in dollar terms in the US is larger than total growth in Brazil, China and Russia, while the non-better beer profit pool declined. We agree that the growth in high-end beer will likely continue to outpace that of the broader beer category growth, but expect the decline in mainstream beer to reverse when employment trend improves.


SAM is no longer targeting share growth in the craft beer category – Given the number of new craft brands that continue to flood the marketplace, SAM appears satisfied with the volume growth for its Sam Adams trademark, and is not focused on growing market share. Jim Koch, Chairman, believes that in 1-2 years, retailer and distribution capacity will likely reach maximum penetration.


Big brewers have been more successful in penetrating the above-premium category – Both ABI and MillerCoors have increased focus on the above-premium category, and we believe are more cognizant of keeping the profit pool intact at the high end. At the same time, SAM sees some risk of big brewers commoditizing their product.


Cider: everyone is joining the party, but in different ways – On a positive note, Jim Koch noted that the development of the cider category in recent years has been driven by multiple brewers who have come up with unique and differentiated positioning. Stella Artois Cidre is positioned more as a premium European wine, Angry Orchard is positioned similar to a craft beer and Crispin is positioning itself against crisp California white wine. In particular, we believe Angry Orchard’s success is due to the quality and taste of the product, as it uses cider apples from the Normandy region. SAM faced supply constraints last year given strong growth, but this should not occur this year.


SAM closing price US$150.27 (05/14/2013)




C&C’s full year results in line with forecasts


Source: RTE News

Wednesday, 15 May 2013


C&C’s net revenues for the year to end of February slip by 0.8% to ?476.9m C&C’s net revenues for the year to end of February slip by 0.8% to ?476.9m


Drinks company C&C has reported full year earnings in line with forecasts, with operating profits up 2.4% and a 0.8% fall in net revenue.


C&C said its operating profits, before exceptional items, rose by 2.4% to ?113.9m for the year to end February.


Net revenue for the year fell by 0.8% to ?476.9m, while pre-tax profits, before exceptional items, rose from ?106.1m to ?109m.


The company said it continues to see a challenging market for cider sales but said its Tennent’s brand is performing strongly, offsetting weakness in sales of Bulmers and Magners and other cider brands.


C&C has proposed a final dividend increase of 5.6% to 4.75 cent per share. This gives 7.1% growth in the full year dividend to 8.75 cent per share.


”Our results are in line with stated guidance and while it has not been an easy year for our core cider brands, with poor weather and increased competition, particularly in the UK, the second half did bring some trading stability in Ireland,” commented C&C’s chief executive Stephen Glancey.


He also noted that C&C’s international business saw volumes increasing by over 55% in the year.


See show C&C shares performed in Dublin trade


C&C’s Irish division saw a 6.1% fall in revenues to ?133.8m for the year while operating profits decreased by 11.9% to ?38.5m. The company said that over the 12 month period, the growth in cider total volume sales outperformed the growth in beer total volume sales, with growth of 1% reported.


Poor summer weather hit the first half the year, but trading stabilised in the second half with Long Alcoholic Drinks (LAD) up 1.5% in the second half compared with a decline of 3.2% in the first.


The company recently completed a deal to buy the Gleeson wholesaler business. It said this shows its ”long term belief in Ireland as a place to invest and gives C&C a platform for domestic growth for the first time in many years”.


Revenue at C&C’s UK division fell by 15.9% to ?195.8m while operating profits decreased by 15.6% to ?30.9m as the UK cider category saw its first volume decline in almost a decade – it dropped by 2% as poor weather hit consumption in the key summer months.


C&C noted that its Magners cider brand underperformed the market with volumes falling by 13.9%. It added that key summer events, including the London Olympics and the European Football Championship, failed to deliver any volume improvement.


Operating profits at the Tennent’s UK division jumped by 34.7% to ?30.3m while revenues rose by 2.6% to ?229.3m. C&C said that volume held up better in the pub trade with a fall of 2% comparing favourably to a fall of 6% in the off-licence trade.


C&C said that revenues at its international division rose by 52% to ?48.5m while operating profits jumped 33.8% to ?9.1m. The company said that the next 12 months should prove to be a significant period for the development of the division after the purchase of Vermont Hard Cider Company in the US in December.


C&C’s chief executive Stephen Glancey said that the next year will inevitably be a transition period as the company integrates its recently acquired businesses. ”C&C will continue to deliver earnings growth to sustain long term growth objectives,” he added.




C&C Group plc – F13 results review


Solid delivery against guidance; investment thesis intact


Source: Nomura

May 16, 2013


European Beverages

Stock Rating: Buy

Target Price: EUR 6.40

GCC.I (EUR 4.65)

Edward Mundy – NIplc


Robust delivery against F13 guidance

The company has delivered F13 results in line with guidance, with EBIT EUR 113.9m vs. guidance EUR 112-118m including EUR 1.8m benefit from the first time consolidation of Vermont.


Investment thesis intact

As we wrote in our report, ROI moving into growth , 6 March 2013, the shape of the business has evolved towards an improving growth profile. We would identify measures to protect and grow profits in the company’s core markets with a focus on capturing growth in cider internationally. We estimate the company’s growth exposure (including ROI, Tennent’s UK and the international business) at c.70% of company profits.


US cider – integration done, ramping up phase now

With the integration of the Vermont Hard Cider Company complete and the US infrastructure build out in place, we see momentum picking up in the Vermont business. We trim F14e group EBIT by EUR 1m to reflect some slower initial momentum in year one post the acquisition (20% volume growth vs. previous 30%) and we reduce our target price from EUR 6.60 to EUR 6.40. Longer term we remain confident that C&C can exploit the significant growth opportunity in the nascent US cider category.


Balance sheet remains strong – offers further opportunities

With F13 net debt to EBITDA 0.9x, the balance sheet is in good health and offers firepower of c.EUR 500m for further value accretive deals.



The company trades on cal 2014 p/e 13.6x vs. the beer average 17.0x.




CARICOM defends intention to take rum issue to WTO


Source: The Gleaner

May 15, 2013


Caribbean Community (CARICOM) countries say they will continue to oppose subsidies being granted to UK-based Diageo, one of the world’s biggest producers of rum, because of the impact the subsidy is having on rum producers in the Caribbean.


CARICOM Secretary General Irwin LaRocque told the Caribbean Media Corporation (CMC) that trade ministers who met in Guyana last week had endorsed the stance being taken to have the matter aired at the World Trade Organization (WTO).


“I want to make it clear, we do not have an issue with the United States Virgin Islands. We do not have an issue with the recoverable programme of the resources that the US Virgin Islands receives from the US Treasury,” LaRocque said.


“The problem is the subsidy that is being provided to probably the largest alcohol producer in the world, Diageo, and it puts our rum producers at a distinct disadvantage,” he added.


“All of the member states are very supportive of those who are going to go forward for consultations at the WTO under the dispute settlement mechanism,” he pointed out.


“The region has been trying now for almost two years” to enter “into dialogue, consultation with the United States government, and sometimes it has been a little bit frustrating in terms of trying to get a door open to get those discussions,” LaRocque explained.


“I think that has caused the region to want to put the matter in a forum where it can be looked at,” LaRocque told CMC, adding that “we are always looking for some way of resolving the matter”.


Last August, the UK-based Diageo reportedly warned that should CARICOM mount a complaint to the WTO over the alleged subsidies it would ‘re-evaluate’ its Caribbean interests.


Diageo has denied ‘flooding’ the US market and has defended the US government’s 100-year-old ‘cover over’ programme, which it said granted the USVI and Puerto Rico much-needed revenues to promote economic stability and fiscal autonomy.




But last week, the CARICOM Council for Trade and Economic Development (COTED) reiterated the need for an amicable solution to the dispute with the United States.


COTED said it “is determined to seek a satisfactory solution to the matter of trade-distorting subsidies being granted to USVI and Puerto Rico rum producers that threaten the long-term viability of the rum industry in the Caribbean”.


It added that “ministers agreed to explore all avenues to address this serious matter with the United States and other relevant parties”.


In March, US Virgin Islands Governor John de Jongh wrote regional leaders urging CARICOM governments to back down on their plans to take the ongoing dispute before the WTO.




De Jongh wrote the prime ministers of Antigua and Barbuda, St Vincent and the Grenadines, Grenada, St Kitts and Nevis, Dominica and St Lucia urging them to avoid the WTO, claiming that this could lead to a prolonged legal case that could also be divisive and difficult to win.


He also warned that going to the WTO could “inflict damage on all of our economies”.


Earlier this year, Barbados Prime Minister Freundel Stuart said rum-producing countries had been holding high-level talks with the United States on resolving issues surrounding the rum industry in the region.


Stuart said the discussions, which were also attended by officials from the Dominican Republic, were necessary since, within recent times, subsidies had been given to rum producers in the USVI and Puerto Rico, much to the disadvantage of Caribbean rum producers, including Barbados.


He said the situation is so serious that Barbados is prepared to take its case to the WTO if a solution is not forthcoming.




TTB Amends the Distilled Spirits Standards of Identity Regulations to Recognize “Pisco” as a Type of Brandy and a Distinctive Product of Peru and Chile


Source: TTB

May 15th


On May 16, 2013, the Alcohol and Tobacco Tax and Trade Bureau (TTB) will publish a final rule in the Federal Register amending its standards of identity regulations for distilled spirits to include Pisco as a type of brandy that must be manufactured in accordance with the laws and regulations of either Peru or Chile. This final rule will be effective on July 15, 2013.





Use of Social Media in the Advertising of Alcohol Beverages


Source: TTB

May 14th


To:  Proprietors of Bonded Wineries, Bonded Wine Cellars, Taxpaid Wine Bottling Houses, Beverage Distilled Spirits Plants, Breweries, Importers, Wholesalers and Others Concerned.




This circular provides guidance to industry members and others on the Alcohol and Tobacco Tax and Trade Bureau’s (TTB) position that the advertising provisions of the Federal Alcohol Administration Act (FAA Act) and the implementing regulations under 27 CFR parts 4, 5, and 7 apply to all advertisements (as defined in the regulations) in any media, including social media.  This guidance provides a basis for voluntary compliance with the FAA Act and the TTB advertising regulations with regard to social media, both in terms of required mandatory statements and prohibited practices or statements.




Electronic nose better than a human’s


Source: the drinks business

by Lucy Shaw

15th May, 2013


A group of Swedish and Spanish engineers have invented an “electronic nose” capable of detecting fruit aromas more effectively than a human.


Using its 32 sensors, the device, which the researchers claim is more sensitive than a human nose, can currently only distinguish between the odors emitted by chopped apples and pears.


“The fruit samples are placed in a chamber into which an air flow is injected that reaches the tower with the sensors, which are metal oxide semiconductors that detect odorous compounds such as methane or butane,” said researcher José Pelegrí Sebastiá.


Software is then used to gather real time data and the information is processed through classification algorithms.


The results can be viewed on a 3D graph that distinguishes between the apple scores and the pear scores.


The study, published in the “Sensors and Actuators A” journal, is the starting point for research the team is involved in to develop multisensory systems that increase the capacity to differentiate complex mixtures of volatile substances.


Sebastiá believes the technology could one day be used in the wine industry to distinguish between grape varieties and recognise a wine’s vintage.


However, the news has been met with skepticism from winemakers.


“The human nose is amazingly sensitive and can detect whether or not something smells good; I’m not sure how you could program a computer to do that,” Daniel Baron, chief winemaker at Silver Oak Cellars in the Napa Valley, told TechNewsDaily.


He did concede however, that the electronic nose might come in useful when winemakers lose their sense of smell through a head cold.


“If I get a cold in January all work stops. Maybe with a mechanical nose I wouldn’t have to worry about it,” he said.




Bacchus Capital Management Provides Significant Growth Capital to DeLille Cellars And Acquires Panther Creek   


Renowned Wine Makers Chris Upchurch and Tony Rynders to Join Forces with Bacchus


Source: PR Newswire

May 15, 2013


Bacchus Capital Management, LLC, a San Francisco-based private equity firm providing strategic capital in the wine industry, has made a significant investment of growth capital in DeLille Cellars, Woodinville, Washington. The winery was founded in 1992 by Charles and Greg Lill , Jay Soloff and Chris Upchurch , and is one of the most respected wineries in the US today. Concurrently, Bacchus has acquired the Oregon winery Panther Creek Cellars and has appointed acclaimed winemaker Tony Rynders as Panther’s Consulting Winemaker.


“Our partnership with Bacchus provides DeLille Cellars with the financial backing and growth ability that we could not have accomplished on our own,” stated Greg Lill , DeLille Cellars President and CEO. “We were the first Washington winery, founded over 20 years ago, to focus exclusively on crafting Bordeaux style blends. Our wines have met with much critical acclaim and consumer demand. Now we are at a point where we need additional resources and proven expertise in order to take advantage together of the opportunities ahead.”


“Washington State is a grand cru region that happened 10,000 years ago,” commented Chris Upchurch , DeLille Cellars Winemaker and Co-founder. “It’s our responsibility to take that forward, to exploit the terroir and to make terrific wines. We are on the path of discovery to reach the potential of a great wine region and a great wine brand. With Bacchus as our partner, DeLille Cellars will be able to take advantage of many additional aspects of making and selling our wine for the future.”


“I have been making wine in Oregon for nearly 20 years,” commented Tony Rynders , Consulting Winemaker at Panther Creek Cellars. “This winery has a storied history and I am eager to build on that legacy. I look forward to crafting our own examples of the exceptional regional blends Oregon is known for: Pinot Noir, Pinot Gris and, most recently, Chardonnay. I have always enjoyed the creativity of making wine. The chance to be a part of Panther Creek’s next chapter and to work with a team of proven and committed professionals is an exciting opportunity.”


“Bacchus is focused on supporting talented winemakers and on building family-owned wineries, enabling them to fulfill their potential,” stated Sam Bronfman , Bacchus Co-founder and Managing Partner. “We believe that the Pacific Northwest is an outstanding winemaking region, offering winemakers diverse environments to craft unique and admirable wines. We are proud to partner with individuals regarded both as pioneers and leaders in their field. Working with Chris Upchurch and the team at DeLille, as well as with Tony Rynders and the team at Panther, fulfills a great ambition of ours. With these two accomplished winemakers, and the teams at DeLille Cellars and Panther Creek, our portfolio truly is a ‘string of pearls’.”


“Our private equity model is unique,” commented Peter Kaufman , Bacchus Co-founder and Managing Partner. “We do not have one singular black box approach to investing in wineries. Rather, we invest in businesses and winemakers we believe in; for DeLille Cellars, we have provided growth capital and in Panther’s case, it’s an outright acquisition. Additionally, we continue to leverage our internal talent across the portfolio: we have appointed Oregon veteran Anthony Van Nice , working with us at Wine by Joe, as President at Panther Creek to partner with the highly acclaimed winemaker Tony Rynders . Our goal is to develop customized long term partnerships.”


Bacchus portfolio companies include: Andretti Winery, a well-known Napa winery founded by Mario Andretti ; Madrigal Family Winery, a recognized Napa Valley winery located on Highway 29; Maritime Wine Trading Collective, a leading boutique wine import, production, and distribution company; Qupe, a leading Central Coast winery; Sbragia Family Vineyards, the Dry Creek Valley winery founded by world-class winemaker Ed Sbragia ; Wine by Joe, one of the largest wine producers in Oregon. Bacchus previously had a successful financing with Cameron Hughes Wine , one of America’s fastest growing wine businesses.




Bordeaux 2012: Pichon Lalande, Malartic Lagraviere, Beychevelle release


Source: Decanter

by Jane Anson in Bordeaux

Wednesday 15 May 2013


The last two days have seen a few attempts to get what has been described as the ‘forgotten Bordeaux 2012 campaign’ finally moving, but customers are ‘turning their backs on the vintage’, merchants say.


Among the chateaux showing a willingness to listen to the market have been Chateau Pichon Longueville Comtesse, which posted a 20% drop to ?57.60 ex-Bordeaux, and Chateau Malartic Lagraviere, which also came down 20% to ?21.60 for its red, and down 17% to ?34.80 for its white.


Chateau Grand Puy Lacoste also posted a larger-than-average drop of 19% to ?38.40 ex-Bordeaux.


Chateau Beychevelle only dropped 10.53% to ?40.80 (a full 90% over its 2008 price), but this makes it one of the best priced Beychevelles on the market (including the current price of the 2008), because it has proved such a popular wine in the Chinese market over recent vintages.


Négociants in Bordeaux are reporting that Pichon Comtesse is selling out in other markets, but not in the UK.


This was confirmed by Alex Marton, director of fine wine at Bibendum. He told, ‘We thought Pichon was a good enough drop to get behind, because the quality was there, and it’s cheaper than Pichon Baron and Lynch Bages.


‘But as happened with the 2011 campaign, our customers have just turned their back on the vintage, and it’s difficult to convince people to buy. The First Growths came out at the right price, and there was sufficient interest, but after that, no other chateaux have matched it.’


Geoffrey Vale of Geoffrey Vale Wines reports a similar lack of interest from clients. ‘I will probably buy some wines in a few months, once I have looked over all the prices – there doesn’t seem to be any hurry.’ .


Elsewhere price drops have created even less excitement.


Both Langoa Barton and Léoville Barton proved unpopular with buyers, dropping respectively just 4% and 2% to ?30 and ?44 ex-Bordeaux.


Chateau d’Issan came down 13% to ?32, Haut Batailley down 6% to ?22.80, Chateau Grand Pontet down 10.35% to ?15.60, Marquis de Terme ?22.80, down 7.32%.


Other wines out today include Chateau La Pointe, down 3.03% to ?19.20, Chateau Fieuzel down 5.56% to ?20.40, Chateau Gloria down 5.41% to ?21, and Chateau Marquis d’Alesme down 5.56% to ?19.95.


There are a few significant names still left to release – with the largest number concentrated in Pomerol – but most observers feel Bordeaux is running out of time to make 2012 a successful en primeur vintage.


‘It seems almost a nail in the coffin for the en primeur system,’ said Marton. ‘If chateaux want to sell at this premium, they should keep the wines in their cellars and release it at whatever price they want at a later date. But if they want the benefit of en primeur, they need to look at their strategy.’


Several chateau owners, however, are pointing out that percentage price decreases are not a fair way to assess value, as production costs were relatively high for all estates in 2012, but classified estates have more margin for price increases and decreases’


One Médoc producer, who asked not to be named, told, ‘It’s unfair to assess price decreases the same way for different chateaux, since the story is all about production costs. A cru bourgeois in 2012 selling for anything below ?10 will be at break-even best case, while any Grand Cru Classé at ?30-plus will be doing well.’


See Decanter’s full 2012 Bordeaux scores and tasting notes here




Christie’s launches vineyard sales service


Source: Decanter

by Laura Ivill

Wednesday 15 May 2013


Christie’s is launching a service to help prospective buyers of vineyard estates.


Vineyards by Christie’s International Real Estate will be introduced at the Hong Kong Christie’s Fine & Rare Wines sales on 25 May and then rolled out globally.


Christie’s says that demand from affluent Chinese investors for foreign wine has extended to a growing interest in foreign wine-producing estates.


According to the French rural land development organisation Safer (Sociétés d’Aménagement Foncier et d’Etablissement Rural), in 2011 there were 35 châteaux with vineyards sold in the Bordeaux region, of which 60% were sold to Chinese buyers, and of the 37 vineyard-châteaux sold in 2012, 62% went to Chinese buyers.


Michael Baynes of Maxwell-Storrie-Baynes, Christie’s International Real Estate affiliate in Bordeaux, said: ‘Many of our Chinese clients have stated that they have initially purchased something relatively inexpensive in Bordeaux to establish a presence and learn about the system here. Once they have built their confidence we have been told that they will purchase again, and most likely at a more prestigious/expensive level.


‘That process has now started with the recent sale to the Chinese of Château Bellefont Belcier, the St-Emilion Grand Cru Classé, reported to have sold for about ?30m,’ Baynes said.


According to Baynes, St Emilion Grand Cru Château La Mouleyre was reportedly sold to Chinese buyers for about ?3.5m, Grand Cru Château Quercy for about ?5m and Château Bernadotte for more than ?10m.


‘We believe we will continue to see Chinese vineyard purchases in Bordeaux for some time to come,’ he added.


Christie’s most expensive vineyard sale to date has been in the Uco Valley in Argentina, at US$150,000 per hectare (ha). This compares with California prices where the average price in the Edna Valley and Paso Robles is US$$86,633-$148,515 per ha for planted land.




South Africa harvest at record high


Source: Decanter

by Richard Woodard

Wednesday 15 May 2013


Wine production in South Africa is expected to reach an all-time high this year after the 2013 grape harvest outstripped expectations to reach nearly 1.5m tons.


Overcoming a late and slow start to the growing season, every region except Robertson registered an increase on the 2012 crop, with Olifants River, Breedekloof and Worcester set to break records.


According to estimates from SA Wine Industry Information and Systems (Sawis), the 2013 wine grape crop is expected to rise 5.4% on 2012 to 1.49m tons, 4.6% up on the previous record year, 2008.


The wine harvest, which includes juice and concentrate for non-alcoholic purposes, brandy wine and wine for distillation, will be just over 1.15m litres, Sawis calculated.


A prolonged winter and cool spring delayed budburst and led to a later harvest for early-ripening varietals, but a dry and warm December concentrated picking times, creating ‘immense pressure’ on winery capacity.


‘Producers, viticulturists and winemakers are excited about a promising crop in terms of quality,’ said wine producers’ association VinPro.


‘The moderate harvest season contributed to intense colour, exceptional flavour and good structure in the red cultivars, especially for Pinotage, appearing good in terms of size and quality.


‘Throughout the industry, winemakers anticipate excellent, fruity and tropical white wines with fresh characteristics.’


The huge crop comes after South Africa exported a record-breaking 417m litres of wine in 2012, up 17% on 2011 and overtaking the previous record by 10m litres.


Exports were boosted by favourable exchange rates and a global wine shortage, but bulk wines accounted for 59% of the total.




Champagne shipments down -3.6% in Q1 2013


Source: Barclays

May 15th


CIVC global shipments declined by -12% in March 2013 (6% of annual volumes). France was down by -17% on an easy comparable (-5.6% in March 2012). European volumes declined by -11.2%, compared to -22.4% a year before. Shipments to other countries (19% of volumes) improved by +1.5% (-22.4% in March 2012). In Q1 2013, which accounts for only 16% of annual trade, industry shipments are down -3.6%, an improvement compared with -14.6% in Q1 2012. YTD champagne shipments saw a -9% decline in France, +1.8% growth in rest of Europe and +3.9% in other countries.

Although we believe austerity measures will continue to hold back any sharp recovery in core European markets, with tentative signs of a bottoming in total industry data, the outlook is arguably a little more encouraging. Lanson recently stated in its FY result press release that 2013 had started “a little bit better than 2012”. We recently changed our ratings on Laurent-Perrier and Lanson-BCC to EW from UW, and kept the EW rating on Vranken-Pommery, see our report “Tough comps – buy on any weakness” from 11 April 2013. Our preferred pick in the European Beverages space is Diageo (OW, PT 2400p), a reflection of its increasing Emerging Markets exposure augmented by improving price/mix delivery in the US.




France in uproar over wine tax (Excerpt)


Source: The Australian

May 15, 2013


VINEYARD owners denounced yesterday as traitors French senators who dared to suggest the country might be a better place if it drank less wine.


The row erupted when it emerged a Senate committee was considering a tax rise on wine in an attempt to curb excessive drinking and improve the nation’s health. France’s powerful wine industry went into overdrive as it sought to counter the move, which would bring taxation on wine to a level similar to that levied on beer and spirits.




We Can’t Help But Be Judgmental. Why ULTIMATE WINE CHALLENGE® Results Are the Last Word in Wine


Source: Savona Communications

May 15, 2013


While hundreds of wine competitions all claim that they are the real deal, the fact is, only one truly is – Ultimate Wine Challenge®. Ultimate Wine Challenge, the world’s most authoritative wine competition, boasts 15 of the world’s foremost wine buyers, authors, journalists and sommeliers, including seven Masters of Wine.


Held at Astor Center in New York City on June 3 – 7, 2013, the panels of judges will rate hundreds of the world’s red, rosé, white, fortified and sparkling wines and sakes under perfect tasting conditions. The best brand in each category will be identified as a Chairman’s Trophy winner, followed by high-scoring Finalists.


Ultimate Wine Challenge results are widely circulated and used by companies to promote their product and by consumers looking for purchasing guidance. Results of this year’s UWC will be released the week of June 10 on


Says Ultimate Beverage Challenge Judging Chairman F. Paul Pacult, “The wine knowledge and experience of this year’s UWC judging panels is unparalleled. The combination of superstar judges and our rigorously uncompromising judging criteria will deliver the most comprehensive and exacting results, period. We report the truth, upon which savvy marketers build their brands.”


Ultimate Wine Challenge  2013 Judges are:

.         Chairman F. Paul Pacult, journalist, educator

.         Co-Chairman Sean Ludford, journalist, consultant

.         Christy Canterbury, MW, buyer, writer, educator

.         James Conley, buyer, sommelier

.         Doug Frost, MS MW, author, educator, journalist

.         Mary Ewing Mulligan, MW, educator, author

.         Mary Gorman-McAdams, MW, educator

.         Lisa Granik, MW, educator, writer, consultant

.         Ed McCarthy, author, writer, consultant

.         John McClement, buyer, educator

.         Jean K. Reilly, MW, journalist, buyer

.         Jack Robertiello, journalist

.         Patricia Savoie, journalist, educator

.         Jennifer Simonetti-Bryan, MW, author, educator

.         Tara Q. Thomas, journalist, author.


UWC benefits to brands:

.         Tasting notes for all products rated 85 points and higher;

.         Challenge logos and icons for use in promotion online and in print;

.         Recognition of products that are Great Value with free, downloadable icon;

.         Shelf-talkers that feature UWC logo, score, award, accolade and tasting notes;

.         Publication of UWC results in the October issue of Beverage Media in the top ten US markets – reaching over 60,000 key trade buyers.


Entries for this year’s Challenge are being accepted through May 24th. To enter, please go to


Ultimate Wine Challenge.

not like any other wine competition and doesn’t want to be.



Ultimate Beverage Challenge (UBC) provides expert evaluation of wines and spirits for producers, importers and marketers through its innovative annual competitions – Ultimate Spirits Challenge and Ultimate Wine Challenge. UBC promotes the results from the Challenges to consumers, media and members of the trade through its Web site, email, and social media. UBC is dedicated to raising the standard of wine and spirits evaluations, and offers marketing tools to help companies build their brands among both trade and consumer purchasers.


For additional information about the Challenges, past results, photos, videos and press coverage go to or contact us directly at or 1-347-878-6551.




Music Fan Triggers Shooter Jennings, Devil John Moonshine Partnership


Source: Dave Perry

May 15th


Singer/songwriter Shooter Jennings has signed a partnership agreement with Barrel House Distilling Company, makers of Devil John Moonshine, and Accelerated Brands, a spirits brand development firm.


The deal, which includes promotional support of Jennings’recent ‘The Other Life’ album and movie release, his upcoming summer Gunslinger Tour, and future development of the artist’s own line of spirits, was announced

following the May 2013 contract signing.




Phusion Projects Expands National Account Team


Source: Phusion Projects

May 15, 2013


Phusion Projects welcomes Shannon Hall as a new national account team lead where she will be tasked with managing Phusion’s chain business in the Pacific Northwest region. The territories include Idaho, North California, Oregon and Washington.


Prior to joining Phusion, Hall worked as a chain account manager at Miller Brewing Company for four years. She also gained experience as a chain account manager at Pepperidge Farms, an account and broker manager at PepsiCo, and an account manger for L’Oreal, among various other positions.


“Bringing Shannon on board rounds out our national account team and helps cement strong relationships with our retailers on the West Coast,” said Robbie Farquharson, vice president of national accounts.  “We are thrilled to have her at Phusion promoting our brands.”


Hall graduated from Portland State University with a B.S. in marketing and resides in Portland, Oregon.




Missouri: Senators block liquor legislation


Source: St. Louis Post Dispatch

By Elizabeth Crisp

May 14, 2013


Several Missouri senators spent Tuesday afternoon blocking liquor legislation that has been the topic of intense lobbying this session and several recent lawsuits.


The move to block the legislation is the latest in a complicated battle over relationships between liquor suppliers and the distributors who get wine and spirits to Missouri retailers for consumers to buy. At issue is whether the government has any role or responsibility in those deals.


The proposed legislation would make it more difficult for alcohol suppliers to sever their relationships with distributors by deeming those relationships as “franchises,” which have stricter standards that must be met to avoid financial repercussions when contracts are broken.


Last week, the House moved to advance the liquor legislation, by tying the proposal to a homebrewed beer bill that has drawn relatively little attention this session. The House vote essentially revived the liquor debate that had stalled in committees in the House and Senate.


During a nearly three-hour filibuster on the liquor bill, several senators opposing the legislation indicated that they were prepared to stall it as long as necessary to kill the debate or get the bill sent to conference, where House and Senate negotiators would work to address issues.


Sen. Brad Lager, R-Savannah, said he believes that there are issues that need to be resolved in state law, but he doesn’t support the current version of the bill – particularly because it would be retroactive.


“You don’t jam anything through the Senate,” he said. “That’s not how we work.”


Senate Majority Floor Leader Ron Richard, R-Joplin, wouldn’t say whether the legislation will get a second shot on the floor before the session ends Friday.


“Nothing’s ever dead on the floor of the Senate,” he said.


Sen. Eric Schmitt, a Republican from Glendale handling the bill in the Senate, said the intent is to clarify the law and return Missouri to the system that it operated under for decades.


After a 2011 federal court ruling overturned a state law that had been governing the relationship between suppliers and distributors since 1975, some of the country’s largest liquor suppliers began filing lawsuits to end deals with local distributors.


“Our state has developed a scheme and now we have a (court) decision that throws all of that out the window,” Schmitt said. “I think we ought to think long and hard about whether or not, through inaction, we want to change very clear pronouncements that this body has had for years.”


The issue has drawn intense interest in the state Capitol, and the Senate galleries were packed with observers during the floor debate and filibuster.


Lawmakers say they have been bombarded with calls and emails from supporters and opponents of the proposed liquor law. Nearly three dozen lobbyists have been working the issue in the halls of the state Capitol.


Opponents of the proposed legislation, modeled from the pre-2011 system, say it inserts government into activities that should be left to the free market.


“I don’t see a bunch of jobs going away; I see the market changing,” said Sen. Ed Emergy, R-Lamar, “I see those that do the best not only surviving, but thriving.”


Sen. Kurt Schaefer, R-Columbia, said that the state would face lawsuits if it goes forward with the current version of the bill, which attempts to make the law retroactive.


“If we’re going to change this law and go backwards we’re going to change contracts that exist,” he said. “There’s going to be a lawsuit – the state of Missouri is going to get sued.”


But Proponents say inaction on the bill will lead to consolidation in the industry and hurt Missouri businesses.


In a statement Tuesday evening, Sue McCollum, CEO of St. Louis-based Major Brands, the state’s largest distributor, urged lawmakers to pass the legislation before the session ends Friday.


“This legislation is important to hundreds of retailers, consumers and distributors across the state,” she said. “Thousands of Missouri jobs depend on this bill and those workers deserve an up or down vote before the legislature adjourns for the year.”


Hope for homebrew?


The beer bill caught up in the fight over liquor distribution, would allow homebrewers to pour their beers at festivals, competitions and charity events but not sell them – a response to an unexpected ban on homebrewed beer at last year’s St. Louis Brewers Heritage Festival.


Schmitt said he’s hopeful that another bill carrying the homebrew language will pass – though it hasn’t yet moved to the House floor.


Only one senator voted against the beer bill, sans liquor franchise language, when it passed the chamber last month. The House had little discussion on the underlying homebrew bill, but spent nearly two hours debating the liquor franchise part last week.


(The homebrewed beer bill, now with liquor franchise language, is SB114 the other bill carrying an amendment to allow homebrew at festivals is SB121)




New Hampshire: NH Liquor Store Clerk Helps Save Customer’s Life


Source: CBS Boston

By Michael Rosenfield

May 15, 2013


A clerk at a New Hampshire Liquor & Wine Outlet in Nashua is being credited with helping to save a life after a customer collapsed on top of a liquor bottle display.


Sean Gerrish, 23, was working at the store on Tuesday when he heard a commotion.


“I heard a crash,” said Gerrish. “I saw the gentleman laying down into it.”


Gerrish and another customer jumped into action.


“We helped flip him over, and we realized he wasn’t breathing, he had turned purple,” said Gerrish.


Gerrish called 911, and the dispatcher instructed him to give chest compressions.


“It was my first time, I actually learned listening from the dispatcher on the phone,” Gerrish said.


Another customer took over before paramedics arrived. That man’s name is John Brunette, according to the Nashua Telegraph.


The victim, 56-year-old Daniel White, known as “Whitey” to his friends and family, suffered a massive heart attack and has now undergone quintuple bypass surgery, according to his daughter.

Kristen White says she is tremendously grateful for Sean’s effort.


“It’s nice to see good people doing good things,” said White. “I think it’s a lesson for everybody and you would only hope that if you were faced with that situation you would do exactly what Sean did. I’m sure it was frightening, he’s a young kid.”


Kristen says her father wants to thank Sean and the others in person for their help.


Mr. White is a trucker who usually transports propane. Family members say it is lucky the heart attack happened in the store, rather than on the road.


White also lives alone, so if it had happened at home there might not have been anybody to help.


The local ambulance company awarded Sean a life-saving pin.


“That could have been my dad or my brother.”




Iraq: Gunmen attack Baghdad liquor stores, 12 killed


Source: Reuters

Tue, May 14 2013


Gunmen using silenced weapons attacked at least nine liquor stores in Baghdad on Tuesday, killing 12 people, police and medical sources said.


Police sources said the attack targeted a row of stores selling alcohol in Zayona district of eastern Baghdad, which has a majority Shi’ite population.


Even though most people shun alcohol, forbidden under Islamic law, Iraq is a generally less conservative Muslim society than neighbors such as Saudi Arabia and Iran, thanks to its mix of Shi’ites, Sunnis, ethnic Kurds and Christians.


But Islamist parties have risen to the fore since the fall of Saddam Hussein in 2003 after the U.S.-led invasion and many fear they could encourage hardline Islamists to exert more influence over aspects of Iraqi life.


Saddam legally allowed shops to sell alcohol, although bars and nightclubs were banned towards the end of his rule.


“Gunmen in four SUV vehicles stopped near the liquor stores and gunmen equipped with silenced weapons started shooting at everybody near the stores,” Furat Ahmed, a policeman at the scene, said.


Police and medical sources said at least nine customers and three liquor store owners were killed, and three others were seriously wounded.


Violence is still well below its height in 2006-7, but provisional figures from rights group Iraq Body Count put violent deaths in April at more than 400 – the highest monthly toll since 2009. About 1,500 people have been killed this year.



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