Wine importer finds way around state monopoly

Icelandic wine importer Sante may have found a loophole that will allow Icelandic consumers to circumvent the state monopoly on the sale of wines and spirits.

In addition to charging high taxes on alcohol the Icelandic state is the exclusive retail seller of alcoholic beverages to the public and operates wine shops in all major population centers. Thanks to EU regulations Icelandic consumers can also purchase wine from European retailers who ship the orders by mail, but this results in relatively high shipping costs and long delivery times.

Sante, run by Icelandic entrepreneur and wine connoisseur Arnar Sigurðsson, has established a sister company in France, Santewines SAS, which operates as a EU-based online wine shop but stores its stock in Iceland, thereby minimizing the high cost and long delivery times that came with having online purchases shipped from mainland Europe. Customers can, if they wish, save on shipping and collect their online purchases directly from the Santewines warehouse, located in a mixed industrial-commercial zone adjacent to Reykjavik harbor.

Industry insiders seem to disagree on whether Sante’s operations are fully legal, but both importers and manufacturers of alcoholic beverages are monitoring this new venture to see if authorities will intervene. Should the arrangement prove to be in accordance with the law it will likely bring about a major change in the market.

“It is perfectly clear that not a single [importer and manufacturer] will sit by and do nothing if that is the case. The same would go for grocery stores which would begin offering a similar service,” said Jón Erling Ragnarsson, general manager of wine importer Mekka Wine & Spirits when interviewed by the Morgunblaðið.

The Santewines online wine shop can be found at www.sante.is and offers, for example, some 86 varieties of red wine and 35 types of champagne.

In the past few years Icelandic authorities have faced increasing pressure to make changes to the law so that alcoholic beverages can be sold in grocery stores. There has also been pressure from the growing microbrewery industry to allow producers of craft beer to sell directly to customers.

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