By Shelby Sebens
PORTLAND, Oregon (Reuters) - Federal regulators on Friday bowed to pressure from Oregon lawmakers and wine growers and suspended a new rule that threatened to hamper the sale of refillable wine jugs at grocery stores and restaurants.
In a letter to Oregon's congressional delegation, John Manfreda, administrator of the U.S. Alcohol and Tobacco Tax and Trade bureau, said that the rule would be put on hold to allow further research on how best to regulate the filling of the jugs, known as growlers, with taxed wine.
The bureau ruled last month that Oregon businesses selling bulk wine on-the-go would have to apply for status as wine bottling houses, which would require them to label and keep the same records as large-scale wineries.
That rankled many in Oregon, which last year became one of the first U.S. states to allow consumers to buy wine in refillable jugs, called growlers.
In the letter, Manfreda said that after talking with lawmakers and advocates in the wine industry, the bureau realized that the rule would be "unduly burdensome" on the industry.
"Based on these conversations, we believe that the impact on industry may be more complex than initially understood," Manfreda said.
Democratic Senator Ron Wyden called the decision a win for Oregon's wine industry, which generates about $3 billion a year in economic activity.
"This is news that deserves a toast - wine growlers are once again legal in the State of Oregon," Wyden said in a written statement. "I want to thank the Alcohol, Tobacco Tax and Trade Bureau for managing to break through the bureaucratic morass and finding a common sense solution."
Oregon has more than 500 wineries, making it fourth in the nation in wine production. Businesses had sought to take advantage of the lower cost of selling wine from a keg, building on a similar trend for beer. Under federal law, bars and stores can sell beer growlers without a bottling license.
(Editing by Dan Whitcomb and Dan Grebler)