There are many kinds of wine warehouses. They vary in size, location, history and design, but there are some things they all have in common. Whether you store your wine collection in an old quarry or a disused World War II bunker, it is safe to say that your storage warehouse is most probably dark, cavernous, cold and absolutely traceable. These key elements are all essential for top wine investment merchants. These are the storage conditions they pride themselves on, and rightly so, after all, it is technically their money that is going into storage.
High Quality, Low Profit
Surprisingly, some wine storage warehouses don’t profit from providing these perfect storage conditions. Believe it or not, France has not been making money from wine storing. Even though a large percentage of wine is stored there, the French facilities have not been profiting from the storage. While bonded warehouses in countries like the UK, Switzerland and the US charge for storage, in France payments are only due once the wine leaves the warehouse. This means that the wine can be sold and resold, the owner can profit from each sale, while the company providing the storage facility makes practically nothing.
An Aroma of Change
But, this is all about to change. After nine years of lobbying, certain laws regarding wine mobility in France have been relaxed. This could effectively put French storage facilities in line with other warehouses around the world. According to the previous rules, it was illegal to release wine back into the local market after it had been stored. As a result, wines were moved to other countries for more flexible storage and distribution. But as of recently, France no longer requires companies to know exactly where their wine is headed before storing it in bonded warehouses in the country.
Great News for France
The market for bond storage is nearly exclusively for high-end investment wines. With the new laws in place there is no longer any major reason to move wines out of France and sacrifice their distinction as truly ex-Bordeaux. In theory, the new rule makes Bordeaux an ideal centre for storing and reselling en primeur wines, which were delivered from a nearby winery with 100% traceability and a minimal carbon footprint. Having the ability to hold stock in transit without being liable for taxes also means that stock pools can be expanded.
What does the Future Hold
How will the UK, Switzerland and the US react to this new reality? Will they form partnerships with bonded warehouses in France, set up their own bonded facilities, or amend operations in some other way? We will have to wait and see. This is certainly an interesting time for these changes to take place. Despite Brexit affecting wine movement between the EU and the UK wine remains an excellent investment and is still being bought and sold all over the world. It may be down to a mere shift in perspective to make it work for all parties concerned.