Wine Digest (January 14)

Ministry of Agriculture declines to delay enforcement of new wine classifications – Negotiation continues

Amendments to the classification system of Russian laws regulating wine were adopted at the beginning of July. Most publicly controversial was a requirement that the Russian-language back label on Champagne label it as “Sparkling wine from the Champagne [“Shampan”] region”; use of the term “Shampanskoye,” the Russian translation of the wine category Champagne, was reserved for sparkling wine produced in Russia. However, more troubling to importers and retailers was the prospect of having to change the back labels and documentation for almost all wine sold in Russia – including wine already in the country or in the midst of the lengthy import process. To avoid the prospect of a great deal of wine suddenly becoming technically “counterfeit,” potentially leading to shortages of imported wine, a temporary moratorium on enforcement was put into place, initially to October 1, and then to Dec. 31.

However, as the deadline approached, a number of wine retailers, producers, and importers sent a letter to Prime Minister Mishustin, warning that a six-month grace period on enforcing these changes was not sufficient. They noted that tens of millions of bottles labeled under the previous system remained unsold – stuck in customs, in warehouses, or even on store shelves – raising the possibility of confiscation and potential losses of up to 15 billion rubles. However, the Ministry of Agriculture declared in a statement on Dec. 29 that the moratorium had been enough time for “most suppliers to be highly prepared to work under the new conditions,” so would expire as planned, with the new law taking effect on Jan. 1. Industry sources report continued problems in the new year with shipments clearing customs, and negotiations are ongoing. Read more about it in Russian here.

Abrau-Durso acquires an Azerbaijani winery

The Russian wine conglomerate Abrau-Durso has won the privatization tender for the purchase of the ASK Sheki Sharab winery in the Sheki region of Azerbaijan, with a capacity of 2.6 million bottles per year. As part of the conditions of the privatization, Abrau-Durso will invest more than € 2.3 million in the development of the winery. The company plans to export wines produced at ASK Sheki Sharab primarily to Russia. Read the original news in Russian.