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Missouri Senate Blocks Vote On Franchise Bill, Dealing Blow To State’s Top Wholesaler

May 20, 2013

The controversial liquor franchise bill that was passed by Missouri’s House of Representatives was blocked from coming to a vote by the state’s Senate on Friday—the last day of the legislative body’s session. The bill, which would have made it more difficult for beverage alcohol suppliers to cut their ties with distributors, was backed by Major Brands, Missouri’s largest spirits and wine distributor. But it faced considerable opposition when it hit the Senate floor last week, both because of concerns that it was anticompetitive and also due to a provision that would have made the law retroactive.

After being proposed in Missouri’s House and Senate earlier this year, the franchise legislation had been stalled in committee for much of the session. However, it was tacked on to an unrelated bill concerning home-brewing late in the session, and then passed in the House by a vote of 110-48.

Without franchise protection, Major Brands now appears vulnerable. Two of its biggest suppliers, Diageo and Bacardi, filed suit earlier this year to end their relationships with the distributor. Pernod Ricard USA had also sued to terminate its agreement with Major Brands, saying it wanted to consolidate its portfolio (which had been split between Major and Glazer’s in Missouri) with one distributor. But Pernod later appointed Major as its exclusive Missouri distributor.

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