What’s in a name?
Pervinder Davies looks at what to know about New Zealand’s legal framework for emerging beverage categories...
As the drinks industry continues to innovate, new beverage categories such as hard seltzers, zero-alcohol spirits, and alcohol-free beers are flooding
the market. These products blur the traditional lines between food and alcohol, raising important regulatory questions – particularly in New Zealand, where the legal framework has not always kept pace with rapid product evolution.
Definitions matter: alcohol or not?
In New Zealand, the starting point for regulation is whether the product is considered “alcoholic.” The Sale and Supply of Alcohol Act 2012 (Act) defines alcohol as any beverage with more than 1.15% ABV (alcohol by volume). Beverages under this threshold – such as many hard seltzers, kombuchas, and zero-alcohol spirits – are not treated as alcoholic for the purposes of licensing and sale. But that doesn’t mean they’re free from regulation.
Instead, low- and zero-alcohol products are typically governed by the Australia New Zealand Food Standards Code (the Food Standards Code), which sets out compositional and labelling rules. If the product contains any alcohol at all, even below the 1.15% threshold, it must still comply with specific food labelling standards, including disclosure of alcohol content.
Hard Seltzers: a regulatory chameleon
Hard seltzers are a particularly complex case. They can fall into different legal categories depending on how they’re made. If brewed through fermentation, a hard seltzer may be classified as a “beer” under the Food Standards Code. If it’s created by mixing spirits with flavoured water, it could fall under “ready-to-drink” (RTD) spirits. Each classification carries different requirements for production, labelling, and taxation. Moreover, a hard seltzer above 1.15% ABV will fall within the Act regime. This means it can only be sold by licensed premises, and its promotion must comply with New Zealand’s alcohol advertising laws, including the industry’s Advertising Standards Authority codes and Alcohol Beverages Advertising Code.
“Products labelled as zero-alcohol beer or spirits present their own issues. ”
Zero-alcohol beer and spirits
Products labelled as zero-alcohol beer or spirits present their own issues. While these beverages are typically marketed as alcohol-free, some contain residual alcohol below 0.5% ABV due to the production process. Under the Food Standards Code, these are considered foods and not alcoholic beverages, but the labelling must not mislead consumers. Claims like “non-alcoholic” or “alcohol- free” must be accurate and substantiated. The key risk here is consumer confusion and regulatory scrutiny. The Fair Trading Act 1986 prohibits misleading or deceptive conduct in trade.
Licensing and retail considerations
One of the major practical benefits of producing beverages under 1.15% ABV is that they can be sold through general retail outlets without a liquor licence. However, this does not give businesses carte blanche. Zero-alcohol drinks designed to mimic traditional alcoholic products can still raise concerns, particularly if marketed in ways that appeal to minors or encourage excessive consumption. Retailers also need to be mindful of placement and packaging. While there is currently no ban on the sale of zero-alcohol spirits or beers in supermarkets, the regulatory environment is evolving and further restrictions could be introduced in response to public health advocacy.
The shifting regulatory landscape
New Zealand’s current legal framework was not designed with modern innovations like hemp-infused cocktails, adaptogenic tonics, or alcohol-free gins in mind. This means regulators are often playing catch-up, and businesses must be proactive in interpreting the law in a responsible way. Producers looking to launch in this space should seek early legal advice to determine how their product will be classified, what labelling is required, and whether licensing or duty obligations apply. They should also consider how their marketing will be interpreted by both regulators and consumers.
Final word
The legal framework in New Zealand for emerging beverage categories is fragmented, and definitions can be fluid. What looks like a soft drink might be a beer in legal terms; what seems like a spirit might be a food. Navigating this space successfully requires a clear understanding of how your product is made, how it is presented, and how it fits within existing laws.
As innovation continues, it’s likely that regulations will evolve in response. Staying ahead means not only complying with current law but being attuned to how the regulatory and social climate is shifting.
Pervinder Davies specialises in alcohol licensing law and is a director of Pervinder Davies Law in Christchurch.
pervinderdavieslaw.co.nz
