New Russian law classifies beer as alcohol

Craft beers and other liquor for sale at a liquor store in Chicago.

STEVE CHIOTAKIS: In Russia, vodka is famously the country's national drink. Nothing else really measures up. certainly not beer, which until today, hasn't even been classified as alcohol there. So now, with new regulations, international brewers including ones in the U.S., are expecting to take a hit.

From Moscow, here's reporter Peter van Dyk.


PETER VAN DYK: Since the end of the Soviet Union, Russians have got a real taste for beer. And international brewers have poured in to take advantage. Rocketing sales have been helped by laws that allowed anyone to sell beer at any time.

Now the new law says beer is alcohol -- and with that, come all sorts of restrictions.

Natalya Zagvozdina of Renaissance Capital in Moscow says the end of sales at street-corner kiosks will hurt brewers.

NATALYA ZAGVOZDINA: They are a big channel representing between 10 and 12 percent of beer consumption.

Zagvozdina says along with the alcohol label comes a total ban on TV advertising. That will also be a problem, although brewers and industry groups say they have time to adjust. The law doesn't come into effect until long after presidential elections next March.

In Moscow, I'm Peter Van Dyk for Marketplace.

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