Legislation to establish a distillery industry in Bermuda was passed yesterday by MPs in the House of Assembly.

The Distilleries Licensing Act 2023 proposes creating a licensing system for the operation of a distillery and the sale and supply of locally distilled spirits.

The legislation will introduce a $1,250 distillery licence for small-scale production and a $8,000 commercial distillery licence for larger ventures.

Licences will be valid for one year and are available through the Liquor Licensing Authority. The renewal fee for the commercial licence will be $4,000 but renewal for small-scale production will remain the same as the initial licence fee.

Under the rules, stills may only be used by a licensed distiller in a distillery and it will be an offence to use or sell a still without a licence.

The legislation also creates a “transitional” three-month period for those who are already distilling spirits for sale or supply to apply for a relevant licence.

Any spirits produced or distilled contrary to the legislation can be seized and forfeited. It will also be an offence to buy, remove or receive any “wort, low wines or spirits” known to be made in contravention of the Act.

Fines under the legislation range from $1,000 for failing to notify authorities of a change of address to $12,000 for the importation or delivery of immature spirits.

In reading the Bill, Vance Campbell, the Minister of Tourism and the Cabinet Office, said: “The creation of local distilling furthers this Government’s aim to provide opportunities for local entrepreneurs to participate in a new industry sector.”

However, he said the distillery process is “unfriendly to the environment” and that by-products must be disposed of safely.

“Only individuals experienced in distillation will be granted a licence,” he said.

He joked: “There are no clauses included that will prohibit Bermudians from continuing to make the ever-popular rum swizzle.”

Craig Cannonier, the One Bermuda Alliance MP, said he supported the introduction of a new industry but questioned the safe disposal of the by-products, and whether a sustainability review will be done.

He asked if products can be exported and whether local farmers can produce sugar or other products to contribute to the industry locally.

Mr Campbell said: “It is not a simple process — it involves a great deal of heat. There is a by-product of alcohol and others that are not environmentally friendly. If the distillation process is not done properly, people can get sick."

He said health and safety departments will be involved in the licensing process, which falls under the Liquor Licensing Authority. “It’s all about safety,” he added.

“There will be jobs in the process as well as distribution and merchandising. There will be opportunities to apply for an export licence. There are jobs at every stage of this process.

“When we meet with someone on something like this, we always talk about sustainability, renewable energy, can we do it a different way, can it be done where it is more environmentally friendly.

“Whether an individual or entity can sustain themselves within the industry, that is a question for them.”

The minister added: “While we have not had conversations with farmers, we have had conversations with entities interested in this industry. They have suggested that we get the farmers involved. This is there for local farmers if they want to take that up. It is an opportunity to produce products for a new industry.”

Mr Cannonier asked what would be considered a prohibited area for production. Mr Campbell said the Government would be working with appropriate authorities including fire, health and environmental, taking into consideration factors such as proximity to people.

Mr Campbell said that production of 150 litres or less will be considered small-scale and anything above that will be regarded as large-scale.