Whisky Connosr

WWR News: August 2012

By Dominic Roskrow

Still Crazy after all those beers (and whiskies)…

I'm launching yet another magazine on line next month - this time on craft and boutique distilleries making gin, vodka, rum brandy and any other spirit as well as whisky.

Still Crazy will be the official magazine of the Craft Distillers' Alliance and will be published six times a year with the first introductory issue out at the start of September.

Still Crazy will include features on member spirits producers and provide the latest news from the world of craft distilling. It will taste and review new boutique spirits, and include analytical pieces on issues such as still size and the law, the main obstacles to craft distilling, how to distil, and the costs of distilling spirits. There will also be special features from our associated trade groups The American Distiling Institute and The Australian Distillers' Association.

The Craft Distillers Alliance will have four main aims:

  • To lobby on issues relevant to members, particularly on a local level to help distillers launch and establish themselves
  • To promote the positive image of craft distilling and focus on issues such as responsible drinking, quality over quantity, job creation, tax generation and tourism generation. This will be done through the bi-monthly magazine and trade press releases
  • to promote craft distilling products through tasting events, mini packs of members' products sold through The Whisky Tasting Club, and through promotions with associated bars, restaurants and hotels
  • to offer advice and support on anything from where to source equipment and grains to labelling, naming and tax and bonding issues through a website and members' discussion forum

The Association will go 'live' on September 1 - at the same time as the first issue of Still Crazy is published.

The biggest obstacle to a craft distilling explosion in the United Kingdom has been removed

The United Kingdom could be on the cusp of a craft distilling revolution similar to the one that has swept through America as growing evidence suggests that the main obstacle to distilling has effectively been removed.

You've no doubt heard that it is illegal to make whisky on small stills under a certain size.

WELL IT'S NOT.

For decades there has been a widely held view that distilling was not allowed on stills smaller than 18 hectolitres. It has been repeated so often that people have assumed it to be correct and it has largely gone unchallenged. As recently as two weeks ago the Scotch Whisky Association's chief executive Gavin Hewitt said that malt spirit could not legally be distilled on a still smaller than 18 hectolitres.

But new information shows that this interpretation is WRONG. The rules governing the minimum still size are not set in stone, and they neither prevent distilling on small stills now - but technically they never did. Moreover, not only can the rules be challenged, but on more than one occasion in recent weeks they have been - and small distillers in both England and Wales have been granted licences to make whisky spirit on stills much smaller than 1800 litres capacity.

The laws governing distilling are highly complex but the sections pertaining to a minimum still size were first enshrined in The 1823 Excise Act and are included in the Alcoholic Liquor Duties Act (ALDA) 1979. They were drafted in relation to customs and excise duty and are designed to ensure that the correct tax is paid.

Customs and excise commissioners have historically adopted a policy of refusing licences to any distiller wishing to distill spirit where the largest still used is less than 18 hectolitres (or originally, 400 gallons) or where an equivalent throughput could not be achieved in an eight hour shift using a a patent or continuous still.

But in a customs and revenue internal guidance document known as X-1 and published on the HMRC website as SPIR 3090 the following words appear: "We may consider licence applications in respect of stills below 18 hectolitres where there are satisfactory controls in place to protect the revenue and the required control resources are not disproportionate to the amount of revenue involved."

According to specialist independent excise dusts consultant Alan Powell, who played a part in writing the guidelines when he worked in the customs and excise policy division, these words open the door for would-be distillers.

"I believe the law (consolidated from many years ago) provided the commissioners with discretion to refuse to issue a licence in respect of premises where the largest still was less than 18 hl (originally 400 gallons) because of the possible risk that such a still might be moved from what would (then) have been the entered premises in remote areas for illicit use," he says. "In current times, this risk is negligible and certainly not credible where the distillery is located in a restricted urban area."

Incredibly, then, the standard view that you can't distill on small stills is wrong. Commissioners historically refused licences to people wanting to distill on small stills and went unchallenged because before 1995 the only right to appeal was through a long and expensive judicial review process. That has now been scrapped.

"Basically, until the law was changed in 1995, the only way a challenge could be made against a decision by HMCE was by judicial review , which is expensive," says Powell. "In relation to under-sized stills, I guess nobody even thought a challenge was possible at all.  Nobody likes to question Customs.

"If the commissioners’ decision is to refuse an application for a licence now, that decision can be appealed to the tax tribunal, which anybody can do and at no cost (or lower cost than judicial review if professional assistance is sought.) Bear in mind, HMCE/HMRC has to act reasonably in reaching a decision and the tribunal can review HMRC’s decision. Those legal principles are not optional.  The commissioners are constrained to follow them or else are acting unlawfully."

So much for the theory. But now it seems in practice customs and excise has shifted its position, too. The newly-established London Distillery Company, with Powell's help, successfully applied for a licence to start distilling in Battersea later this year, and in Wales organic farmer John Savage-Onstwedder started distilling this week after being granted a licence.

"The still I was applying for was only 350 litres, so well below their minimum requirement," he says. "Nonetheless, I thought I would phone my local guy and when I mentioned their own regulations he said: 'those regulations were introduced when we were still roaming the Scottish hills with muskets trying to sniff out the illegal stills! Put in your application and see what happens'. I did and lo and behold I was granted a licence."

While the new approach makes the potential for a wave of new craft distillers, Alan Powell warns that there are still considerable barriers to overcome.

"Bear in mind that not only is the licence required, but one must also obtain an approval for the distillery (this relates to conditions, site plan etc) AND, importantly probably have to have an excise warehouse (bond) in association with the distillery," he said. "The law is not straightforward." 

What the law states

Alan Powell quotes a decision made by Dr Nuala Brice in the case TDG (UK) Ltd and the Commissioners of Customs and Excise. From consideration of legal authorities, Dr Brice noted that the following principles may be derived.

  • A person to whom discretion is given must consider each application and decide it in the light of circumstances at that time.
  • A person may develop a policy as to the approach that he will adopt in the generality of cases but the policy must not preclude the decision-maker from departing from it, or from taking into account the circumstances of each case
  • The attitude of the decision-maker must be such that he is prepared to make an exception in a deserving case
  • An inflexible and invariable policy is unlawful

In particular, Dr Brice directed that the commissioners must observe the principles of reasonableness enunciated in the decision, by the following:

 "WE DIRECT that the commissioners should take steps to ensure that officers conducting statutory reviews under the provisions of section 15 of the 1994 Act are clear about: the relevant legislation under which the particular decision is taken; their correct function under section 15 which is to reach their own decision; the need to take into account all the circumstances of each case; and the need to be aware that they are not precluded from departing from a policy and that THEY SHOULD BE PREPARED TO MAKE AN EXCEPTION IN A DESERVING CASE" (The writer's emphasis) 

The simple test is the man on the Clapham omnibus test.

Arise Australia fair

Tasmania is set to get yet another new distillery.

The Redlands Estate distillery will have a traditional floor malting and kilning process as part of the distillery operation making it the first malt whisky distillery in Australia to produce malt whisky from paddock to bottle.

According to Bill Lark, the Derwent Valley distillery is going impressively according to plan. The company was formed by Bill, Peter Hope and James Reid as directors. It is located on the very historic property of Peter and Elizabeth Hope’s called Redlands. Redlands is just 35 minute drive from Hobart along the Derwent River in the picturesque Derwent Valley.

"Redlands was in fact established in 1819 by George Frederick Read, the legitimate son of King George IV, sent to the colonies to make a name for himself," says Bill. "It became a very significant property and remains one of the most important colonial properties here in Tasmania.

"The property contains many heritage buildings, having once been a hop production property, with frontage to the Plenty River and it contains an elaborate  system of convict built water canals fed directly from the Snowy Ranges looking over the property.

"The property now grows some of the highest grade brewing barley selected by Cascade Brewery for its famous beer production, incidentally where Lark Distillery obtains its malt. We have already trialed a batch of malt from last year’s harvest."

The plan is to make the Redlands Estate an iconic tourist destination.

"With its trout fishing in the Plenty River and significant historic European garden and trees, the distillery will become a must visit destination for malt whisky enthusiasts," says Bill.

"It is proposed that visitors we be able to become hands on in the process of making whisky from walking through the adjacent fields of barley and walking through the malt floor to get to the distillery where they will be encouraged to help with the mashing, brewing and distilling processes. Of course we will also be introducing many opportunities for special whisky events incorporating fly fishing, music, food, art, gardens and history all on the one site."

Planning and Heritage Council approvals have now been obtained for the distillery and construction has already started on the stills, mash tun and other plant and equipment, all being constructed in Hobart by Australia’s leading still maker, Peter Bailly of Knapp Lewer Constructions. The distillery is being supported by the owners of the property and his family is funding the development of the distillery.

"We will be applying Lark Distillery techniques and know-how to the production and I will be training James Reid as the head distiller," commented Bill.

The distillery will initially commence operation with the one 900 litre copper pot still and eventually increase production with the addition of a 2000 litre wash still. The distillery will be sourcing ex Tasmanian red wine barrels which will be coopered down by a local cooper into 100 litre 'Australian quarter casks' which will have been shaved and re-charred prior to filling.

"Early trials of these barrels have been producing some stunning whisky," says Bill.  

"Barley to bottle" at Glann ar Mor

Breton whisky producer Glann ar Mor is set to release new bottlings of Glann ar Mor and peated whisky Kornog.

And this month the distillery harvested its own barley and will be making malt whisky with it later this year - giving them their first grain to glass whisky.

"We planted barley in our field just 20 metres from the front of the distillery," says distillery owner Jean Donnay. "This has added a lot of work for us but it has been worth it. The barley will be floor malted by end of October and we will have the first casks of a 'from barley to bottle' Glann ar Mor in maturation by end of November.

Watch for a full feature in issue six, with tasting notes.

Wales goes organic

A new distillery has opened in wales - and it's set to offer drinkers an exciting range of new whiskies.

The distillery is on an organic farm owned by John Savage-Onstwedder and in July it started producing gin. But it intends to make whisky using malted barley, corn, rye, wheat and tricale - which is a hybrid grain of wheat and rye.

For the full story, see the feature in this issue.

Meanwhile The Lakes Distillery has put its launch date back until March and April. The plan had been to start distilling gin and vodka this Autumn with whisky to follow, but managing director Paul Currie says that all production will start in early 2013.

A work in progress: israeli spirit aged 16 months

Israel has started producing its own malt spirit. Israeli whisky enthusiast, connoisseur and blogger Gal Granov brings us this…

The Rosenblatt brothers are two young alcohol fanatics who live and operate from Israel. They have a passion for everything related to spirits. They distill everything, and produce an amazing array of spirits from homemade beers using ancient recipes, to wine, rum, and liqueurs, all 100 per cent made in Israel from local ingredients. They use homemade equipment, a wee still they acquired and a lot of enthusiasm.

A few years ago, Nimrod the elder of the two decides it's time to start and distill single malt whisky in Israel. Using a mix of two kinds of malted barley one already smoked over beech wood, the other smoked and peated using an their own equipment designed to suck peat smoke burning in one container into another container with the barley.

For yeast they used beer yeast as some whisky distilleries do, as whisky yeast is not common in Israel - for obvious reasons. Using their tiny still, they distilled the fermented barley twice (two runs as we usually call them : strip run and spirit run). The spirit was cut at 65% and then moved into small Carboys with wooden staves of American Oak and some French Oak chips.

I was able to taste a wee sample of this 16 month old spirit , and I do think it shows great promise. We must bear in mind that these are initial steps in the process and there is a lot of learning 'on the go' that needs to be done. Currently the volumes are very small, and the spirit is not even matured in casks, but in carboys with oak staves inside. Nevertheless, this is a great step forward.

I will be keeping an eye on this operation, as well as on other initiatives to distill whisky which are now in the planning stages by other whisky enthusiast (and on a bigger scale) In Israel.