From Workarounds to Recognition: New York Moves to License Brand Owners

Updated September 2025.

TL;DR 

A.6277-A would add §61-c to New York’s Alcoholic Beverage Control Law ("ABC Law") to create a new Brand Owner’s License (the “License”) for holders of a federal basic permit by the Alcohol and Tobacco Tax and Trade Bureau ("TTB") (a “Basic Permit”). The license expressly authorizes (1) contracting with licensed New York manufacturers for production/co-packing, (2) appointment of a licensed New York wholesaler as an exclusive brand agent to solicit/receive payments, and (3) sale to New York wholesalers. The bill sets an annual fee One Hundred and Twenty-Five U.S. Dollars ($125), clarifies New York State Liquor Authority ("SLA") enforcement authority over brand owners, and authorizes the SLA to promulgate implementing rules. The bill passed both houses of the Legislature in mid-2025 and — as of the latest legislative records and coverage — is awaiting gubernatorial action; if signed, the statute becomes effective ninety (90) days after the Governor signs the bill.

What the Bill changes:  

The operative addition is a new §61-c to the ABC Law. Under the bill text, any person with a Federal Basic Permit (the TTB document that recognizes brand ownership at the federal level) may apply to the New York State Liquor Authority (NYSLA) for a Brand Owner’s License. The statute explicitly authorizes brand owners to:

• Contract with a licensed New York manufacturer for manufacture/packaging (i.e., co-packing), and it amends ABC provisions to make clear licensed manufacturers may lawfully contract with brand owner licensees;

• Appoint a licensed New York wholesaler as an exclusive brand agent who may solicit orders and receive sale payments on the brand owner’s behalf; and

• Sell product to New York wholesalers (rather than attempt direct retail sales that would run afoul of the three-tier structure).

The bill further sets an annual fee of $125 and expands SLA enforcement language to allow civil penalties against brand owners for cause and directs the SLA to promulgate rules to effectuate the new license. 

Why this matters:

At the federal level, the TTB recognizes “brand owners” through the Federal Basic Permit and related mechanisms. By contrast, New York’s ABC Law has historically tethered rights and obligations to manufacturers, wholesalers, and retailers, without a clear counterpart for brand owners. This mismatch created practical friction: brands that did not manufacture their own products struggled to arrange in-state production, while distillers, breweries, and wineries faced compliance obstacles in offering co-packing services. Brand owners also lacked certainty about whether they could be paid by wholesalers or exercise control over distribution. A.6277-A resolves this gap by formally recognizing brand owner activities under state law and granting the SLA authority to license and regulate them.

Practical implications for clients and counsel:

1. Contracting and supply chain: co-packing becomes routine (but requires care)

The new license opens the door for New York producers — distillers, wineries, breweries, and cideries — to co-pack for brand owners without resorting to the patchwork solutions that were common in the past. In practice, this is likely to spark growth in private-label products and short-term co-packing deals that previously carried compliance uncertainty.

For counsel, these arrangements will require careful drafting. Agreements should spell out how products are specified and tested, when title to goods transfers, and how responsibilities are divided for recalls, defects, and excise taxes. They should also address insurance and indemnities, ensure TTB labeling requirements are met, and clarify who owns the product while it is warehoused or in transit. Finally, transition and termination language will be essential to manage the lifecycle of these contracts.

2. Wholesaler agency relationships will be central — negotiate exclusivity carefully

The law also breaks new ground by allowing brand owners to formally appoint an exclusive New York wholesaler to solicit orders and collect payments on their behalf. This codifies a payment structure that until now operated through informal or workaround arrangements, giving both sides a clearer legal footing.

For counsel, the focus shifts to how these agency relationships are structured. Appointment letters will need to spell out the boundaries of exclusivity — which products, in what territories, and for how long. They should also detail how payments are handled, what audit rights the brand owner retains, and what remedies are available if the wholesaler underperforms. Minimum purchase or marketing commitments may be appropriate, and robust termination provisions are critical, particularly for issues like insolvency, breach of contract, or antitrust-sensitive conduct.

3. Antitrust & market power considerations

Exclusivity also brings competitive considerations. If a handful of wholesalers accumulate too many exclusive brand relationships, their market leverage could grow in ways that dampen competition. That outcome isn’t automatically an antitrust violation, but it does raise questions that prudent counsel will want to address upfront. Agreements can be structured to soften these risks through carve-outs, non-discrimination provisions, and protections that trigger if ownership of either party changes. In more complex or high-stakes deals, a deeper legal review may be necessary to evaluate potential vertical restraint issues before they draw scrutiny.

4. Licensing, compliance and enforcement

The bill also brings brand owners squarely under the watch of the State Liquor Authority. A.6277-A gives the SLA explicit authority to impose civil penalties and directs the agency to issue implementing regulations. In practice, that means new application forms, guidance memoranda, and closer scrutiny of brand-owner operations. Licensees will need to keep records that satisfy both SLA and TTB requirements, ensuring that federal and state compliance obligations stay aligned. Counsel should prepare clients for this dual oversight and the likelihood of evolving SLA enforcement priorities once the rules are in place.

5. Tax/excise and TTB interplay

Finally, the new license does not alter the primacy of federal oversight. Brand owners will still need to comply with TTB rules governing label approvals, formulas, and excise taxes. New York’s statutory changes layer on top of — but do not replace — these federal obligations. That makes clear contractual allocation even more important: parties must decide who is responsible for filing and remitting excise taxes, who will claim available credits, and how any audits or assessments will be managed. Getting those details right at the outset will help avoid costly disputes and compliance gaps down the line.

Timeline

• Introduction (March 3, 2025): A.6277 was introduced in the Assembly, with a sponsor’s memo explaining its purpose to align New York’s ABC Law with the federal recognition of brand owners. A companion bill (S.567-A) moved in the Senate.

  
  

• Legislative Passage (June/July 2025): Both houses of the Legislature passed the bill during the summer session. The version that cleared included the core provisions for the Brand Owner’s License, the $125 annual fee, and SLA enforcement authority.

  
  

• Awaiting Gubernatorial Action (as of September 2025): The bill has been transmitted to the Governor but not yet signed. Sponsor statements and trade press confirm it remains under review. Importantly, until the Governor signs, there is no change in law — brand owners and producers must continue using existing structures.

  
  

• If Signed:

  • The statute specifies that it becomes effective 90 days after signature.

  • This 90-day period is a built-in transition window, designed to give the SLA time to:

    • Draft and adopt implementing regulations;

    • Publish new application forms and procedural guidance; and

    • Clarify how it will verify federal Basic Permits and enforce compliance.

  • For market participants, the 90-day clock is a short but predictable lead time to:

    • Finalize co-packing and agency contracts;

    • Update compliance programs and recordkeeping systems; and

    • Coordinate federal and state tax, labeling, and distribution obligations.

      
      

• Action Items for Counsel: Monitor (1) the Governor’s press releases and bill actions page for the signing announcement (which sets the effective-date clock), and (2) the SLA website for forthcoming regulations, forms, and guidance. Once those two milestones hit, the industry will move quickly to operationalize the new license.

What to watch next

1. Governor’s action: The first milestone is the Governor’s decision. Practitioners should track the Governor’s press releases and the official Assembly/Senate bill pages for notice that the bill has been signed and chaptered. The signature date starts the 90-day countdown to effectiveness. Once that date is known, counsel can mark the calendar and advise clients on when they may begin preparing applications and agreements under the new framework.

   
   

2. NYSLA rulemaking: The SLA will need to stand up a new licensing process. Expect the Authority to publish guidance memoranda, FAQs, and new application forms, including instructions on how applicants must document their federal Basic Permits. Counsel should anticipate questions about beneficial ownership disclosures, recordkeeping, and enforcement priorities. Early engagement with SLA guidance will help clients avoid delays in being among the first licensed brand owners.

   
   

3. Market contracting: With a 90-day transition window, there is little time to negotiate contracts once the statute is live. Distillers, brewers, and brand owners should pre-draft co-packing agreements and exclusive wholesaler agency contracts now, so that deals can be finalized quickly when the SLA opens the application process. Being “deal ready” will position clients ahead of competitors who wait until the effective date.

   
   

4. Due diligence playbook: Counsel should build a standard checklist for evaluating counterparties. Key areas include TTB compliance (label approvals, excise filings), beneficial ownership vetting, state and federal tax obligations, insurance coverage, and recall or product defect plans. Having a playbook in place allows faster deal execution and reduces risk of surprises during SLA review or in later disputes.

   
   

5. Antitrust and Competition Monitoring: Industry reaction will be an important second-order effect. If a small number of wholesalers secure large numbers of exclusive agency appointments, distribution competition could be strained. Counsel should keep an eye on commentary from trade groups, wholesalers, and producer associations, as well as guidance from the state Attorney General or the FTC on vertical arrangements. Proactive drafting of carve-outs, termination rights, and non-discrimination language will help clients manage these risks.

Conclusion

A.6277-A may be narrow in scope, but it represents a meaningful modernization of New York’s alcohol laws. By harmonizing state rules with the federal brand-owner framework, it removes long-standing friction around in-state co-packing and legitimizes wholesaler agency arrangements that the industry has until now managed through workarounds. For counsel and clients, the near-term priorities are clear: draft and negotiate co-packing and agency agreements, align compliance programs with both TTB and SLA requirements, and pay close attention to exclusivity and termination protections in new contracts. The real trigger point will be the Governor’s signature. Once that happens, the 90-day effective-date clock starts, giving the SLA time to roll out regulations and forms — and giving the industry a short window to get deals and compliance systems ready for launch.

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Key Legislative Sources

1. Full bill text & status — Assembly version (A.6277A)“Bill Search and Legislative Information | New York State Assembly — A.6277A”https://assembly.state.ny.us/leg/?actions=y&bn=a06277&memo=y&summary=y&text=y New York State Assembly

   
   

2. Full bill text & status — Senate version (S.567A)“NY State Senate Bill 2025-S567A — amendment A”https://www.nysenate.gov/legislation/bills/2025/S567/amendment/A NYSenate.gov

   
   

3. TrackBill summary & full text“A6277 | New York 2025-2026 | Establishes a brand owner’s license” — provides tracking, actions, full text.https://trackbill.com/bill/new-york-assembly-bill-6277-establishes-a-brand-owners-license/2682400/ trackbill.com\

   
   

4. Sponsor memo / summary of the bill (Assembly)NY Assembly memorandum in support of A.6277A.It's part of the Assembly Bill page above. New York State Assembly