Updates to Products Subject To California’s Bottle Bill

10/23/23

On October 13, 2023, Governor Gavin Newsom signed California Senate Bill 353, which made a significant change to products that will be subject to the California Beverage Container Recycling and Litter Reduction Act (known as the Bottle Bill).

Now, only products filled and labeled after January 1, 2024 will be subject to the CRV labeling requirements of the Bottle Bill. Any products (whether domestic or imported) that were filled and labeled prior to that time will be exempt. This legislative fix did not make any changes to the change the reporting or payment requirements of the Bottle Bill.

Please see below for a full summary of the Bottle Bill and contact DP&F with any questions.

With the passage of Senate Bill No. 1013, beginning on January 1, 2024, wine and spirits will be included in California’s state container deposit system established by the California Beverage Container Recycling and Litter Reduction Act (known as the “Bottle Bill”). As such, wineries and distilleries will now be required to comply with the Bottle Bill’s CA Redemption Value (CRV) payment and reporting obligations beginning January 1, 2024, and CRV labeling requirements for all wine and spirits filled and labeled after January 1, 2024 and sold after July 1, 2025. Beer and certain other non-alcoholic beverages were already previously covered by the Bottle Bill.

Importantly, because all wines and spirits (that were not filled and labeled after January 1, 2024) sold in California after July 1, 2025 must be labeled with some type of approved CRV statement, producers should start including this information on their bottles and/or labels as soon as possible for all products to be offered for sale on or after January 1, 2025.

Below we have included a brief summary of the rules applicable to wines and spirits under Bottle Bill, the new registration and payment obligations, and labeling changes required to comply with the new laws.

TYPES OF BEVERAGES:

The Bottle Bill applies to beer, malt beverages, wine, spirits, wine and spirit coolers (regardless of ABV), and certain other non-alcoholic beverages intended for sale in California. Section 14504 and 14560.

CA REDEMPTION VALUES (CRV): Section 14560

For bottles smaller than 750 mL (less than 24 fluid ounces), the CRV is 5 cents/bottle.
For bottles 750 mL or larger (24 fluid ounces or more), the CRV is 10 cents/bottle.
For boxes, bladders, pouches, or similar containers (regardless of size), the CRV is 25 cents/container.

REGISTRATION & PAYMENT OBLIGATIONS BEGINNING JANUARY 1, 2024:

All wineries and distilleries should register with CalRecycle as soon as possible to prepare for payment and reporting requirements beginning 1/1/2024 (information regarding registration can be found here).

All producers and importers of wine and distilled spirits should register as a Beverage Manufacturer. Brand owners that contract with producers for the manufacture of wine or distilled spirits are not considered Beverage Manufacturers.
Any wineries and distilleries that sell wine or spirits in California Direct to Consumer or Direct to a Retailer (for wine) should also register as a Distributor.

2. Report and pay the applicable CRV to CalRecycle.

CRV is due and payable for every beverage container (other than a refillable beverage container) sold or transferred to a dealer or consumer in CA. There is an exception for products served in a tasting rooms, discussed below. 1.5% holdback for administrative fee is permitted.
Report due last day of month following the month of sales, even if no sales or transfers. First report for January 2024 is February 29, 2024.
The winery or distillery may pass on the CRV cost to consumers (as the consumers can return the bottles to a recycling center for the redemption). Section 14560

3. Report and pay the applicable Processing Fee.

The processing fee is paid on all containers a winery or distillery sells or transfers in CA, whether to wholesalers, retailers, or consumers. Section 14575(g)
Report and payment due 10th day of 2nd month following the month of sales, even if no sales or transfers. First report and payment for January 2024 is due March 10, 2024.
The processing fee is variable depending on container material (size does not matter) and changes each calendar year, but is currently 0.452 cents/glass bottle. The Wine Institute has noted that the hope is for the processing fee to be reduced to zero.

LABELING OBLIGATIONS FOR ALL WINES AND SPIRITS SOLD AFTER JULY 1, 2025:

All wines and distilled spirits containers sold in California that were filled and labeled before January 1, 2024 are exempt from and not subject to the labeling requirements of the Bottle Bill. No new labels or statements will have to be added to these products.
All wines and distilled spirits containers sold in California after July 1, 2025 (except those containers filled and labeled before January 1, 2024) must be labeled with: “CA Redemption Value,” “California Redemption Value,” “CA Cash Refund,” “California Cash Refund,” or “CA CRV”.
The CRV statement must be clearly, prominently, and indelibly marked and can be added on the actual label or by sticker (not on aluminum cans), stamp, embossment, or other similar method. Labeling size and location requirements are set forth below: CCR 2200(b).

For glass and plastic, the CRV statement must be on the container body label or secondary label with:
- Option 1: Along the bottom edge of the container body label in minimum lettering size at least 3/16 inch in height.
- Option 2: On or in a secondary label minimum lettering size at least 3/16 inch in height.
- Option 3: On a container body label or secondary label with contrasting colors with legible lettering size at least 1/8 inch in height.
For aluminum, the CRV statement must be on the top lid:
- for tops greater than 2 inches in diameter, the CRV statement must be 3/16” in height; and
- for tops 2 inches or less in diameter, the CRV statement must be 1/8” in height.
Requirements for box, bladder, and pouch containers to be determined.

4. Senate Bill No. 1013 also revised Section 14561(d) of the Bottle Bill to allow for CRV labeling by the inclusion of a scan code or quick response (QR) code on the container. This new language is currently under review by CalRecycle.

EXCEPTION FOR TASTING ROOM SALES:

If any wines or spirits are sold for on-site consumption in a tasting room, then those products are exempt from the Bottle Bill’s requirements.

For more information regarding Bottle Bill compliance, please contact Bahaneh Hobel at [email protected] or Theresa Barton Cray at [email protected].

Effective January 1, 2024, CA Wineries and Distilleries Will Have Reporting and Payment Obligations to CalRecycle Under the Bottle Bill

05/16/23

With the passage of Senate Bill No. 1013, beginning on January 1, 2024, wine and spirits will be included in California’s state container deposit system established by the California Beverage Container Recycling and Litter Reduction Act (known as the “Bottle Bill”). As such, wineries and distilleries will now be required to comply with the Bottle Bill’s CA Redemption Value (CRV) payment and reporting obligations beginning January 1, 2024, and CRV labeling requirements for all wine and spirits sold after July 1, 2025. Beer and certain other non-alcoholic beverages were already previously covered by the Bottle Bill.

Importantly, because all wines and spirits sold in California after July 1, 2025 must be labeled with some type of approved CRV statement, producers should start including this information on their bottles and/or labels as soon as possible for all products to be offered for sale on or after January 1, 2025.

TYPES OF BEVERAGES:

CA REDEMPTION VALUES (CRV): Section 14560

For bottles smaller than 750 mL (less than 24 fluid ounces), the CRV is 5 cents/bottle.
For bottles 750 mL or larger (24 fluid ounces or more), the CRV is 10 cents/bottle.
For boxes, bladders, pouches, or similar containers (regardless of size), the CRV is 25 cents/container.

REGISTRATION & PAYMENT OBLIGATIONS BEGINNING JANUARY 1, 2024:

All wineries and distilleries should register with CalRecycle as soon as possible to prepare for payment and reporting requirements beginning 1/1/2024 (information regarding registration can be found here).

All producers and importers of wine and distilled spirits should register as a Beverage Manufacturer. Brand owners that contract with producers for the manufacture of wine or distilled spirits are not considered Beverage Manufacturers.
Any wineries and distilleries that sell wine or spirits in California Direct to Consumer or Direct to a Retailer (for wine) should also register as a Distributor.

2. Report and pay the applicable CRV to CalReycle.

The winery or distillery may pass on this cost to consumers (as the consumers can return the bottles to a recycling center for the redemption). Section 14560
The processing fee is variable depending on container material (size does not matter) and changes each calendar year, but is currently 0.452 cents/glass bottle. The Wine Institute has noted that the hope is for the processing fee to be reduced to zero.

3. Report and pay the applicable Processing Fee.

The processing fee is paid on all containers a winery or distillery sells, whether to wholesalers, retailers, or consumers. Section 14575(g)
The processing fee is variable, but is currently 0.426 cents/glass bottle or for new containers, 0.574 cents/container. The Wine Institute has noted that the hope is for the processing fee to be reduced to zero.

LABELING OBLIGATIONS FOR ALL WINES AND SPIRITS SOLD AFTER JULY 1, 2025:

All wines and distilled spirits containers sold in California after July 1, 2025, except those containers filled and labeled before January 1, 2024, must be labeled with: “CA Redemption Value,” “California Redemption Value,” “CA Cash Refund,” “California Cash Refund,” or “CA CRV”.
The CRV statement must be clearly, prominently, and indelibly marked and can be added on the actual label or by sticker (not on aluminum cans), stamp, embossment, or other similar method. Labeling size and location requirements are set forth below: CCR 2200(b).

For glass and plastic, the CRV statement must be on the container body label or secondary label with:
- a text height of 3/16”, or
- a minimum text height of 1/8” and in a contrasting color to the background and nearby text.
For aluminum, the CRV statement must be on the top lid:
- for tops greater than 2 inches in diameter, the CRV statement must be 3/16” in height; and
- for tops 2 inches or less in diameter, the CRV statement must be 1/8” in height.
Requirements for box, bladder, and pouch containers to be determined.

3. Currently, there is no exemption for wines or spirits labeled before July 1, 2025. While the Wine Institute is working on legislation to create an exemption for wines labeled before January 1, 2024, wineries and distilleries should start including the required labeling on all applicable containers as soon as possible.

EXCEPTION FOR TASTING ROOM SALES:

If any wines or spirits are sold for on-site consumption in a tasting room, then those products are exempt from the Bottle Bill’s requirements. Any products sold for offsite consumption are subject to the requirements of the Bottle Bill. Section 14510.

Post revised October 18, 2023 to reflect labeling exemption established under California Senate Bill 353.

For more information regarding Bottle Bill compliance, please contact Bahaneh Hobel at [email protected] or Theresa Barton Cray at [email protected].

Prop 65 Warnings Streamlined for Alcohol Beverages Sold Online

03/18/21

California’s Proposition 65 warning regulations were recently amended to modify the delivery of the required state warnings for alcoholic beverages. The modified regulations somewhat ease compliance, as they will now allow for the required warning to be provided to the customer electronically for alcoholic beverages ordered online or via catalog. However, they muddle the standard for other orders that are placed for delivery.

Proposition 65, adopted in 1986, generally requires in California for a statement to be provided before the purchase of products that contain certain chemicals that may cause cancer or reproductive toxicity. Stores are generally required to post signs along-side listed products. The warning methods and language are product-specific, but there is also a requirement that, for products that are sold on line, the warning be provided via electronic device to the customer, without requiring the purchaser to seek out the warning, prior to or during the purchase of the product. Under the existing regulations for internet purchases of products, including alcoholic beverages, the warning or a clearly marked hyperlink using the word “WARNING” must be provided on the product display page or by otherwise prominently displaying the applicable warning to the customer prior to completing the purchase on the website. This rule is not changing.

In addition to the warning on the website, a copy of the alcohol beverage exposure warning was also required to be included on or in all alcohol packages when delivered in California. This portion of the rule is changing, making it easier for online orders, but more convoluted in the case of orders placed other than via the internet or catalog.

Going forward, for an order that is to be delivered to customers in California at a location other than the point of sale that is not made online or from a catalog – for example, for wines ordered in a tasting room for delivery to the customer at another location within California – the product-specific warning must be provided prior to or during the purchase of the wines. The regulation does not specify how the warning must be provided however, but presumably notice should be provided by signage similar to in-store sales, a printed warning on a sales document, or – although not spelled out specifically in the regulation –verbally for phone orders. The regulation is specific though that the warning be provided prior to or at the time of the purchase – not at the time of delivery as was the case previously.

While such transactions are now less clear, with respect to internet or catalog orders of alcoholic beverages, the warning has gotten simpler to deliver. The prior method of a warning on or in the package is still allowed, but the rule has been streamlined to instead allow the required warning to be included in an email or text message with the purchase confirmation rather than having to be printed and included with the shipment. Providing the warning as part of the electronically delivered receipt or confirmation should simplify shipping and can potentially reduce liability for inadvertent warning omissions in shipments to California.

All businesses that employ more than 10 employees that produce or sell alcoholic beverages to consumers in California are subject to Proposition 65 and must be in compliance with the modified regulations by April 1, 2021. Because the definition of “employee” under the regulations is imprecise, we recommend that all applicable Proposition 65 warnings be complied with, even if a winery or retailer has fewer than 10 employees.

For more on this and related issues, please contact Josh Devore.