While local wine trade remains prohibited in South Africa during Level 4 of the country’s lockdown, the question arose whether wine may be sold online during this time, provided that it is only delivered to purchasers when the regulations governing the lockdown permits the delivery of liquor.
Danie Cronjé Attorneys explains the legal aspects of online wine sales to clear up any grey areas.
May wine be sold online during lockdown Level 4 provided that it is only delivered to purchasers when the regulations governing the lockdown permits the delivery of liquor?
The regulations which were published in terms of the Disaster Management Act when the national state of disaster was declared on the 18th of March (and the amendments thereto) were repealed when new regulations (which introduced the Level 4 lockdown) were published on the 29th of April.
Restrictions in terms of the Level 4 lockdown regulations:
Persons are still confined to their places of residence unless they are performing essential or permitted services, obtaining essential goods or exercising subject to the prescribed restrictions.
The regulations contains a list of industries which may commence operations and activities which may now be performed under the Level 4 lockdown.
In terms of the regulations wineries may grow grapes and make wine (and perform all the activities required to do so). Wineries may also export wine and may therefore do what is required for the export including transporting wine for purposes of export.
The sale of liquor (to the trade or to the public) is however still not permitted.
The new regulations also specifically prohibits the transport of liquor except for the purposes of export.
Interpretation of the Level 4 lockdown regulations:
As with the regulations in respect of the Level 5 lockdown the restrictions are aimed at restricting the movement of persons and preventing activities which may cause the virus to spread. In our opinion the provisions which prohibit the sale and distribution of liquor and the provision which only permits the transport of liquor for export purposes should be interpreted taking into account the aim of the regulations i.e. preventing the movement of persons to their places of work and the movement of members of the public to places where liquor is sold under normal circumstances.
It must also be interpreted taking into account the intention of the government to relax the restrictions under the Level 5 lockdown with the introduction of the Level 4 lockdown. In our opinion the fact that wineries are now permitted to export wine does not mean that employees not involved in activities related to the export of wine are now permitted to work at the winery. One of the messages from the Western Cape Government regarding the lockdown is that a business does not have to shut down if its employees are able to work from home (https://www.westerncape.gov.za/department-of-health/frequently-asked-questions/frequently-asked-questions-employers).
It is common knowledge that the closure of businesses during the lockdown will have a severe negative effect on the SA economy. Common sense dictates that, insofar as persons are able to continue working from home, this should be encouraged. It is also common knowledge that the wine industry is suffering ongoing financial losses due to the ban on the sale of wine and that many wineries will close as a result thereof.
In our opinion the regulation prohibiting the sale and distribution of liquor should be interpreted restrictively i.e. that it refers to operations at the normal place of business where the gathering of additional employees will increase the risk of being infected or infecting other persons with the virus – against which the lockdown regulations are aimed.
In our opinion this restriction therefore does not mean that, where employees can conduct the administration relating to wine sales from home, this is prohibited.
The provision against the sale and distribution of liquor makes it clear that wineries may not sell wine to the public from their business premises or transport it to retailers such as supermarkets and liquor stores.
The provision in respect of the transport of liquor is also clear – wine may only be transported for the purpose of export.
These provisions are obviously aimed at restricting the supply of liquor for purposes of eventual consumption by members of the public.
Taking into account all of the above it is our opinion that wineries may receive online orders and process online payments received from members of the public or the trade during the Level 4 lockdown provided that the administration in this regard is conducted at home and not at the normal business premises of the winery and that the sale is only finalised – by delivery of the liquor to the member of the public or the trade – once the delivery of liquor is permitted by the applicable regulations.