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NSW Reselling Alcohol Bottles into Smaller Samples - Legal under Commercial Law?

Discussion in 'Commercial Law Forum' started by Andrewhertha, 25 October 2015.

  1. Andrewhertha

    Andrewhertha Member

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    Hi,

    I am looking to start an online company whereby I intend on splitting full size alcohol bottles down to smaller "samples" and then re-selling these to consumers. Assuming I have the correct liquor licenses, etc., is this legal under commercial law? I would not be using the original companies logo on the sample bottle however would use the name handwritten on the label. It is not something I have agreed with the suppliers to do. I have heard it may be "reverse passing off"?

    Any tips would be helpful.
     
  2. Tim W

    Tim W Lawyer

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    1. You'll need a licence to sell it.
      Chances of getting it? Minimal.
      Chances of getting caught selling alcohol without a licence? More than 50-50.
      Penalties? Can be substantial.

    2. You'll need an agreement from the manufacturer to repackage their product prior to on-selling it.
      Chances of getting it? Minimal.
      Chances of getting found out? More than 50-50.
      Size of the civil damages, and added expense of paying their legal costs as well as your own
      when you inevitably lose? Substantial.

    3. They're not "samples", no matter what you call them in the marketplace.
      They're just repackaged product.

    4. It's a stupid idea.
     
  3. Andrewhertha

    Andrewhertha Member

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    Thanks for the response. Interesting there are number of companies doing exactly this already. They aren't really flying under the radar either, they are advertising on facebook, interviews in men's magazines.

    Thanks though.
     
  4. Tim W

    Tim W Lawyer

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    The majority of whom are doing it by arrangement with the makers (and/or distributors).
    Which is not to say that there are not (literally) bootleggers also operating.
    The way you describe it, you propose to become the latter not the former.
     
  5. Andrewhertha

    Andrewhertha Member

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    No i can say for certain they have not made any contact with distillers. They buy regular bottles,break them down and rebottle and sell samples of 5 at a time to thousands of customers
     
  6. Tim W

    Tim W Lawyer

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    I'd be interested to see some links.
    It's always possible that the manufacturers/ suppliers have decided not to bother enforcing their rights.
    Regardless, that's separate from the requirement of a seller to have a licence.
     
  7. Andrewhertha

    Andrewhertha Member

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  8. Tim W

    Tim W Lawyer

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    Oh, yeah, them.
    They are a proper liquor retailing business.

    They have a liquor licence, of exactly the kind I referred to above.
    And, they have the consent of (ie a contractual relationship with) their suppliers, of exactly the kind I referred to above.
    You can be pretty confident that that contract would (pretty much necessarily) include consent to re-packaging into bona fide samples.

    They have even included Victoria in their Choice of Law clause, and a Term Of Service that expressly reserves them
    the right to refuse orders from customers who look like "dealers, resellers, or distributors" (clause 6).

    In other words, they are set up like a proper retail business.
    What they are doing is an order of magnitude different to the idea of
    buying bottles retail, and on-selling product you repack in your kitchen....
     
    Steph68 likes this.

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