Ohio brewers testify for Senate Bill 23 to remove franchise-law protections for wholesalers

COLUMBUS — At a second hearing on Senate Bill 23, witnesses representing Ohio craft breweries told the Senate Small Business and Economic Opportunity Committee that the Ohio Alcoholic Beverages Act of 1974 gives wholesale beer distributors perpetual franchise protections that can prevent small breweries from ending nonperforming distribution relationships.

Mary McDonald, representing the Ohio Craft Brewers Association, told the committee that "craft breweries are the very definition of small businesses" and argued the bill would allow the written contract between a small brewery and a wholesaler to govern the relationship rather than the default franchise provisions set in 1974.

The bill would carve breweries that produce fewer than 250,000 barrels per year out of the statutory franchise-law protections and subject them instead to ordinary contract law, supporters said. McDonald said the existing law requires manufacturers to prove "just cause" to terminate a distribution relationship, a standard she described as deliberately undefined and one that…