Counterfeit or Artisanal Mexican Spirits? Pick your Poison, or your lime wedge

New proposed regulations in Mexico threaten the ability of small producers of artisanal agave spirits to market what makes them artisanal

Much like how the farm-to-table movement in restaurants has placed the source of the food on your plate front and center, the Mexican agave artisanal spirits movement is highlighting each element that goes into a glass, from the cultivation of the plant and the methods for harvesting and cooking the piña to the distillation process and ultimate bottling. Long gone are the days of tequila or mezcal with its worms, relegated to shots and frozen margaritas.

“New” Mexican agave spirits are making inroads in the American bar scene precisely because they can be marketed as artisanal and small-batch, with a focus on the specific types of varietal used in the distillation and the specific regions in which they are produced—a transparency that’s particularly attractive to American bartenders and imbibers alike. However, a new regulation proposed in Mexico may severely limit what information will appear on bottles of Mexican spirits in the future.   

traditional mezcal production  source:  flickr.com

traditional mezcal production source: flickr.com

In a proposed regulation first published in November 2015, the Mexican government plans to create new classifications and requirements for labeling and marketing of agave spirits, which it claims will combat the issue of counterfeiting and better protect brands.

The introduction to this new regulation, PROYECTO DE NORMA OFICIAL MEXICANA PROY-NOM-199-SCFI-2015, “BEBIDAS ALCOHÓLICAS – DENOMINACIÓN, ESPECIFICACIONES FISICOQUÍMICAS, INFORMACIÓN COMERCIAL Y MÉTODOS DE PRUEBA,” or “NOM-199,” states that its purpose is to protect consumers from deceptive marketing by setting standards for the naming, production, and testing of agave spirits produced in Mexico. 

In spite of the positive intention behind the new regulation, these same classifications and regulations may ultimately create consumer confusion and threaten the ability of legitimate small producers to advertise the special qualities of their authentic spirits that are driving the increased demand in the marketplace. Outrage is being voiced on industry-specific blogs, with fears that the proposed regulations will hamstring small producers from standing out in an increasingly-crowded field of competitors, both licit and illicit.  

NOM-199 will change how many Mexican spirits are named and categorized. The biggest change under the new regulation is the creation of a new umbrella spirit called “komil.” Under NOM-199, any agave distillate spirit that is 51% or more agave and is produced outside of certain defined Denomination of Origin regions in Mexico must be labeled komil, a word not defined in the regulation nor known by most consumers, but which appears to originate from the Nahuatl word for “alcoholic beverage.”

In the new world of Mexican spirits there would be no distinction between a small-production 100% agave spirit made using traditional methods, and a 51% agave / 49% filler mixture, including industrial spirits made on a mass scale in commercial facilities. No reference can be made to what agave varietals are used; in fact, the word “agave” itself cannot be used in any labeling. As a result, small producers would be unable to distinguish their products based on agave varietal, location, or production method and consumers would have no clue what they were imbibing under the komil name.  (To further complicate matters, Wild Agave Imports, LLC of Texas filed a USPTO intent to use trademark application in January for the word mark “Komil.”)

It is not yet certain that this regulation will, in fact, be enacted. A similar regulation was defeated in 2012 after a concerted effort by independent producers and retailers. There are already a number of petitions opposing NOM-199 that have are gaining support, and it may very well be that the public outcry will be enough to change the course of this regulation. On March 17, David Suro, president of the Tequila Interchange Project, a non-profit advocating on behalf of the agave distilled spirits industry, and one of the leading voices of Mezcal promotion in the United States, and others filed their comment in opposition of NOM-199 with Mexico’s Regulatory Commission.

Retailers and consumers of agave spirits here in America should watch with interest as NOM-199 goes through its comment and enactment process. Depending on what happens, we should all keep our eye on the Mexican spirits that end up behind bars and on shelves in the near future.  

  1. The RBS Chronicles: If Your Business serves Alcoholic Beverages YOU NEED TO READ THIS AND TAKE ACTION!
  2. RESPONSIBLE BEVERAGE SERVICE ACT HEARING – OCTOBER 11TH IN SACRAMENTO – BE THERE!
  3. WHEN THE INVESTIGATOR COMES CALLING – BEST PRACTICES.
  4. RESPONSIBLE BEVERAGE SERVICE ACT PROPOSED ABC RULES 160 TO 173 – WHY THE RUSH?
  5. The TTB Crusade Against Small Producers and the “Consignment Sale” Business Model
  6. TTB Protocols, Procedures, and Investigations
  7. Wine in a 250 ML can – the Mystery of the TTB packaging Regulations and Solving the Problem by Amending the Regulations
  8. The Passing of John Manfreda of the TTB: a Tragedy for his family and a Tragedy for the Industry he so Faithfully Served for so Long.
  9. Pride in a Job Well-done, or Blood Money? The Cost of Learning the Truth from the TTB about the Benefits to Investigators from Making Cases Against Industry Members
  10. How ADA Website Compliance Works – The Steps You Can Take to Protect Yourself, Your Website and Your Social Media from Liability
  11. Supplier and Distributor Promotional “Banks,” Third Party Promotion Companies and Inconsistent TTB Enforcement, Oh My!
  12. “A Wrong Without a Remedy – Not in My America” – The TTB Death Penalty for Not Reporting Deaths
  13. Is a 1935 Alcohol Beverage Federal Trade Practice Law Stifling Innovation?
  14. Decoding the BCC’s Guidance on Commercial Cannabis Activity.
  15. Prop 65 - Escaping a "Notice of Violation"
  16. TTB Consignment Sales Investigations - What is Behind the Curtain of the TTB Press Releases?
  17. Heads Up! The ABC Is Stepping Up Enforcement Against Licensees Located Near Universities
  18. Coming Soon: New Mandatory Training Requirements for over One Million “Alcohol Servers” In California – September 1, 2021 will be here quickly
  19. 2019 Legislative Changes for California Alcohol Producers – a Blessing or a Curse?
  20. A Picture (On Instagram) Is Worth A Thousand Words
  21. Playing by the Rules: California Cannabis Final Regulations Takeaways
  22. Hinman & Carmichael LLP Names Erin Kelleher Partner and Welcomes Gillian Garrett and Tsion “Sunshine” Lencho to the Firm
  23. Congress Makes History and Changes the CBD Game for Good
  24. Pernicious Practices (stuff we see that will get folks in trouble!) Today’s Rant – Bill & Hold
  25. CBD: An Exciting New Fall Schedule… or Not?
  26. MISSISSIPPI RISING - A VICTORY FOR LEGAL RETAILER TO CONSUMER SALES, AND PASSAGE OF TITLE UNDER THE UNIFORM COMMERCIAL CODE
  27. California ABC's Cannabis Advisory - Not Just for Stoners
  28. NEW CALIFORNIA WARNINGS FOR ALCOHOLIC BEVERAGES AND CANNABIS PRODUCTS TAKE EFFECT AUGUST 30, 2018, NOW INCLUDING ADDENDUM REGARDING 2014 CONSENT AGREEMENT PARTIES AND PARTICIPANTS
  29. National Conference of State Liquor Administrators – The Alcohol Industry gathers in Hawaii to figure out how to enforce the US “Highly Archaic Regulatory Scheme.”
  30. Founder John Hinman Honored with the Raphael House Community Impact Award
  31. ROUTE TO MARKET AND MARKETING RESTRICTIONS - NAVIGATING REGULATORY SYSTEM CONSTRAINTS
  32. Alcohol and Cannabis Ventures: Top 5 Legal Considerations
  33. ATF and TTB: Is Another Divorce on the Horizon? What’s Going on with the Agency?
  34. STRIKE 3 - YOU REALLY ARE OUT! THE ABC'S STRICT APPLICATION OF PENALTIES FOR SALES TO MINORS
  35. TTB Temporarily Fixes Problem with Fulfillment Warehouse Tax Credits - an “Alternate Procedure” for Paying Taxes & Reporting
  36. CUSTOMERS WHO HAVE HAD ONE TOO MANY - THE FREE TRANSPORTATION DILEMMA
  37. The Renaissance of Federal Unfair Trade Practices - Current Issues and Strategies
  38. ‘Twas the week before New Year’s and the ABC is out in Force – Alerts for the Last Week of 2017, including the Limits on Free Rides
  39. Big Bottles, Caviar and a CA Wine Strong Silent Auction for the Holidays!
  40. The FDA and the Wine and Spirits Industry – Surprise inspections anyone?
  41. NORTHERN CALIFORNIA WILDFIRES: UPDATED REGULATORY AGENCY DISASTER RELIEF RESOURCES AT A GLANCE
  42. NORTHERN CALIFORNIA WILDFIRES: REGULATORY AGENCY DISASTER RELIEF RESOURCES AT A GLANCE
  43. Soon to come to your Local Supermarket– Instant Redeemable Coupons of the digital age!
  44. The License Piggyback Dilemma – If it Sounds Too Good to be True, it Probably is
  45. A timely message from our Florida colleagues on the tied house laws, the three-tier system and the need for reform
  46. ABC Declaratory Rulings – A Modest Proposal Whose Time has Come
  47. More on FDA Inspections - Breweries, Distilleries and Questions
  48. WHY THE FDA IS INSPECTING WINERIES
  49. Senate Bill 378—The Proposed Demise of Due Process for Alcohol Licensees
  50. ABC Enforcement - Trends and Predictions
  51. The Corruption Chronicles – Volume One: A New Hope
  52. New Alcohol Delivery Oversight on the Horizon
  53. Michigan: Canary in the DtC Coal Mine?
  54. California ABC and Federal Credit Laws – Active Enforcement and Lots of Questions!
  55. Big Bottles For The Holidays - The Highest Calling Of The Winemaker's Art
  56. FINAL COMMENTS TO TTB NOTICE 160 DUE ON WEDNESDAY DECEMBER 7TH – WE ARE ASKING THE TTB TO EXTEND THE COMMENT PERIOD AGAIN TO ALLOW FOR INDUSTRY NEGOTIATION AND ALIGNMENT OF INTERESTS
  57. SONOMA COUNTY WINERY USE PERMITS, EVENT RESTICTIONS AND DTC
  58. New TTB Labeling Requirement Regulations: Out-of-State Bottling Is Not Created Equal and Consumers Right to Know Where the Grapes in their Wine Come from is Compromised
  59. Isn't A Written Agreement With A Distributor Worthless In A Franchise State?
  60. Crowd Funding for Alcohol Producers and Retailers – Down the Rabbit Hole with the Tied House laws
  61. Everything you ever wanted to know about the BPA Warning Statement but were afraid to ask
  62. AB 2082 - A Hunting License for Police and a Lethal Weapon for Politicians that Deprives Licensees of Currently Available Due Process Rights
  63. “Better Late Than Never”-- Judge in Illinois Dismisses 201 Sales Tax Cases against Retailers
  64. The Day the Music Almost Died: The Story of the BottleRock ABC Accusations, the ABC Appeals Board and a Victory for a Common Sense Interpretation of the Tied House Laws
  65. The Arsenic in Wine Class Action Dismissal – what it means
  66. Counterfeit or Artisanal Mexican Spirits? Pick your Poison, or your lime wedge
  67. Warning - CA ABC enforcement teams are on the prowl this weekend!
  68. RELIEF AT LAST! ILLINOIS MOVES TO FIX THE SALES TAX LAWSUITS AGAINST OUT-OF-STATE SELLERS BUT PROPOSES TO PENALIZE WINERIES AND RETAILERS THAT SHIP WITHOUT PERMITS
  69. The TTB Speaks on Category Management or, be Careful What you Ask for Because you might Get it!
  70. Hinman & Carmichael LLP Announces the Addition of Jeremy Siegel to its team of top beverage law lawyers
  71. 2016 LEGISLATIVE UPDATES: Part IV
  72. 2016 LEGISLATIVE UPDATES: Part III
  73. 2016 LEGISLATIVE UPDATES: Part II
  74. 2016 LEGISLATIVE UPDATES: Part I
  75. Hinman & Carmichael LLP is Hiring!
  76. John Hinman Presents NBI Webinar on Basics of Alcohol Beverage Law
  77. ABC DISMISSES SAVE MART GRAPE ESCAPE ACCUSATION BUT REFUSES TO ADOPT JUDGE’S DECISION FINDING NO STRICT LIABILITY FOR ABC VIOLATIONS
  78. Speakeasies are still with us, and proliferating!
  79. The War for the Soul of Sonoma County – the Winery Working Group Battle
  80. Santa Claus isn’t the only one coming to town this Christmas!
  81. Arizona's Direct to Consumer Shipping Rules - An Exercise in Complexity
  82. AB 780 - Social Media and the ABC: The California Legislative “Fix” that Fails
  83. Illinois Finally Offers Certainty and Relief for Victims of Sales Tax Lawsuits, but Prompt Action is Required in Pending Cases
  84. A Modest Proposal – Adopt the federal rule on Tied-House liability in California
  85. The Grapes Escaped - Why the First Amendment Matters
  86. Appellate Court Ruling Strikes Blow Against State’s Arbitrary Beer Label Ban
  87. Illinois Attorney General's Office Announces Intention to Dismiss False Claims Act Against Liquor Retailers
  88. Commercial Speech And Alcoholic Beverages - Part III
  89. Commercial Speech And Alcoholic Beverages - Part II
  90. Craft Beverages: Social Media Marketing the Effective and Compliant Way
  91. Commercial Speech And Alcoholic Beverages - Part I
  92. A LAYPERSON LOOKS AT ARSENIC IN WINE
  93. The Biggest Retailer in the World vs. the TABC
  94. Rebecca Stamey-White presents Emerging Issues in Wine Law
  95. Top Beverage Alcohol Law Firm Adds and Elevates Partners
  96. Illinois Qui Tam Lawsuits—Private Enforcement Of a State Claim: A Bonanza For A Plaintiff’s Lawyer And A Rip-Off Of Retailers
  97. BOOZE RULES OF SOCIAL MEDIA: The Retailer Right to Pay Exception
  98. LIONS AND TIGERS AND TWEETS, OH MY!
  99. AB 2004: Brewer's Incremental Parity with Wine Makers
  100. Expanding, Proud Of It, and Wanting to Tell the World