Farm Brewery versus Microbrewery License in New York

January 3rd, 2017 • by Brendan Palfreyman
Brendan Palfreyman

Brendan Palfreyman

Brendan Palfreyman is a craft beer attorney with Harris Beach PLLC in Syracuse, NY and a member of the NYS Brewers Association. He also created and runs the brewery trademark resource website: www.trademarkyourbeer.com. A major focus of Mr. Palfreyman’s practice is representing and counseling craft breweries in New York State with regard to trademarks, corporate issues, real estate, and contracts. Brendan is an award winning homebrewer and has appeared as a guest on podcasts like Steal This Beer and Beer Sessions Radio. He is a dedicated and award winning homebrewer and filed the trademark for the folks at Milk the Funk. He even had a beer named after him by a grateful client.

One of the most frequent questions I get from breweries-in-planning in New York is: “Should I apply for a farm brewery license (FD 106) or a regular microbrewery license (MI 101)?”  The answer, of course, is personal to each brewer, but the pros and cons of each license should be considered.

There is a tradeoff involved with the farm brewery license, in exchange for abiding by certain ingredient quotas, farm breweries are allowed certain privileges.  Those quotas and some benefits available to farm breweries are discussed below.

Per Section 51-A(2) of the Alcoholic Beverage Control law (“ABC”), farm breweries can only make “New York State labelled beer.”  Per Section 3(20-d) of the ABC, “New York State labelled beer” is defined differently based on time frames:

  • Present to 12/31/2018: Beer made with no less than 20%, by weight, of its hops grown in New York state and no less than 20%, by weight, of all of its other ingredients, excluding water, grown in New York state.
  • 1/1/2019 to 12/31/2023: Beer made with no less than 60%, by weight, of its hops grown in New York  state  and  no  less  than  60%,  by weight, of all of its other ingredients, excluding water, grown in New York state
  • 1/1/2024 and Thereafter: Beer made with  no less than 90%, by weight, of its hops grown in New York state and no less than 90%, by weight, of all of its other ingredients, excluding water, grown in New York state.

Per Section 51-A(9), farm breweries can open up to five branch offices in addition to the primary licensed location.  You can do anything at these offices that you can do at the licensed premises, though I would note that if you plan to brew at branch office you may very well need an additional Brewer’s Notice from the TTB.

Farm breweries also have more latitude to sell by the glass alcoholic products made by other producers.  In addition to selling New York State labelled beer and cider made in house, farm breweries can also sell wine, cider, and spirits made by licensed farm wineries, farm cideries, and farm distilleries. Per Section 51-A(2)(b), farm breweries can also make and sell New York state labelled cider.

The regular microbrewery license does not allow for branch offices, but, per Section 51(3-a), it does allow microbreweries to sell New York state labeled beer made by other breweries.  Microbreweries, on the other hand, are not subject to any ingredient quotas. Both microbreweries and farm breweries can sell their own beer by the glass, and the fees charged by the state for each are the same.

This blog is intended to provide general information on a wide range of issues, including legal issues, affecting the brewing industry. It is not intended to provide specific legal advice and no legal advice is given. You understand that merely using this blog does not create an attorney client relationship between you and Harris Beach PLLC or Brendan Palfreyman. The blog should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.