Technical guidance: Is a distiller’s licence required if a trader produces spirits as a by-product of a manufacturing process?
Production of spirits as a by-product usually takes two forms, either:
- as a distillate removed from a fermented liquor to produce an alcohol free or low-alcohol beverage (beer, cider and so on); or
- as ethanol formed as an unwanted product during a chemical reaction.
Provided that the primary purpose of an operation resulting in a spirits by-product is the production of an article other than spirits, a Commissioners’ Direction may be issued (under ALDA s13(2)) to disapply the licensing and associated requirements normally imposed upon distillers. Additional conditions are attached to the Direction for effective control.
One of the conditions attached to the Commissioners’ Direction is that the by-product spirits must either be destroyed or supplied to a vinegar maker (after being warehoused). The law does not permit the Direction to be extended to the use of spirits for any other purpose. Any person wishing to do so must be licensed as a distiller and comply with alllaw relating to distillers of spirits.
If you consider that an application justifies issue of a Commissioners’ Direction, refer the matter to the Alcohol Team, ESM for consideration.