What is a Wine Industry Fund?

Industry funds have been established under the Primary Industry Funding Schemes Act 1998 to support those sectors of primary industry that want to raise their own funds for their own industry development activities.

Six wine industry funds currently operate in the following South Australian wine regions:

• Adelaide Hills
• Langhorne Creek
• McLaren Vale
• Riverland
• Barossa
• Clare Valley 

In addition the SA Grape Growers Industry Fund has been established for the SA grape growing industry.

For each of the funds, the wineries act as collection agents for voluntary contributions made by grape growers and/or winemakers. The contributions are paid into a fund that is administered by PIRSA ('the Minister') and then paid by way of a grant to a body representing the fund contributors.

Each fund is required to:

• Prepare a 5-year management plan which is revised annually 
• Complete an annual operating plan detailing proposed expenditure 
• Report on the operation of the fund.

Each Wine Industry Fund operates independently with the support of growers and/or winemakers in each region.

Who contributes to a Wine Industry Fund?

Depending on the Fund, the following persons are liable to make contributions:

• A grower of wine grapes 
• A winemaker who purchases grapes from a grower 
• A winemaker who grows its own grapes

All SA grape growers (not including winemakers who grows grapes) are required to contribute to the SA Grape Growers Wine Industry Fund.

How are the contributions paid?

Winemakers who purchase grapes grown from any of the wine industry fund regions must forward to PIRSA:

• the grower contribution; and if applicable, 
• the winemaker contribution.

The following fund contributions must be paid to PIRSA by 31 July:

• Adelaide Hills Wine Industry Fund
• Langhorne Creek Wine Industry Fund
• McLaren Vale Wine Industry Fund
• Riverland Wine Industry Fund

The following fund contributions must be paid to PIRSA by 30 June:

• Barossa Wine Industry Fund
• SA Grape Growers Fund
• Clare Wine Industry Fund 

What information needs to accompany a contribution payment?

For grower/winery payments, the following information must be sent to PIRSA with the payment:

• the name of each grower 
• tonnage processed 
• amount of contribution to be made.

Contribution Forms

What is the rate of contribution?

The amount of contribution payable varies between funds, and is determined by industry.

The 2009 contributions are:

* Winemakers who grow Clare grapes will contribute on a cumulative, sliding scale. Hence, a winemaker growing 600 tonnes of Clare region grapes would pay (500 x $2.00) + (100 x $1.00) = $1,100.

Note - The Barossa and Adelaide Hills wine industry funds provide for annual increases.

Who carries the liability if grapes are sold to someone other than a winemaker?

If grapes are sold to an entity other than a winemaker, the grape grower contribution should be passed on to the winemaker for forwarding to PIRSA out of the payment due to the grape grower.

Example 1.  X Grower directly sells to Y Winery "the winemaker".  Y owns the grapes on delivery.

• Grower Contribution:  Y deducts the Grower payment and forwards it to PIRSA.
• Winery Contribution: Y forwards its winemaker payment direct to PIRSA.
  

Example 2.  X Grower sells to Y (a grape purchaser) who on-sells to Z Winery "the winemaker".  Z owns the grapes on delivery -  it is the  ‘winemaker’.

• Grower Contribution: Y deducts the Grower contribution via its payment to the grower. Z deducts the same contribution from Y.  Z forwards the grower payment to PIRSA.
• Winery Contribution: Z forwards its winemaker payment to PIRSA.
   

Example 3. X Grower sells to Y (a grape purchaser) who on-sells to Z who on-sells to W Winery "the winemaker".  W owns the grapes on delivery.

• Grower Contribution: Y deducts the Grower contribution via its payment to the grower. Z deducts the same contribution from Y. W then deducts the same contribution from Z. W forwards the grower payment to PIRSA.
• Winery Contribution: W forwards its winemaker payment to PIRSA.
  

If my wine is contract made, am I liable to make the contribution?

If a grape grower contracts a winery to crush grapes to be made into wine and the winery does not have ownership of the grapes, the owner of the grapes at crushing time (usually the grower) will be considered 'the winemaker'. So, the grower must forward both the grower and winemaker contributions to the Fund.

What is the liability of a winemaker who purchases grapes and uses their own grapes for wine?

In the case of grapes grown by a person other than the winemaker, the winemaker is responsible for deducting and forwarding to PIRSA the grower contribution. The winemaker will be liable for:

• the winemaker contribution (where applicable) on grapes purchased from a grower 
• the grower/ winemaker contribution for the grapes grown by the winemaker made into wine.

Does it matter where the grapes are sold?

No, because the regulations apply to grapes grown in a particular region, regardless of where the grapes are sold. For example, a winemaker in the Barossa who purchases grapes grown in the Riverland is required to pay, collect and forward the Riverland Grower contribution and the Riverland Winemaker contribution.

What if the grapes are sold to a processor outside of South Australia?

The Primary Industry Funding Scheme Act and its regulations do not apply to interstate wineries using grapes from SA regions covered by the Act. But quite a few interstate wineries that purchase SA grapes make voluntary contributions to a Wine Industry Fund.

What is the situation with a very small-scale grower?

The Act does not specify a minimum payment for a Wine Industry Fund.  If grapes are grown by someone other than a winemaker, that payment is likely to be calculated and made by the winemaker who will have several grower contributions to pay into the Fund.

Contributions in the SA Grape Growers, Barossa and Clare Valley Wine Industry Funds are all rounded down to the nearest tonne.

How is the fund spent?

Contributions to each fund are applied for the benefit of the industry as determined in the Regulations.

Are contributions compulsory?

Contributions are compulsory, but a contributor can request that their payment be refunded. To claim a refund, you must:

• complete the appropriate refund form for the region
• provide documentary evidence (such as a weighbridge docket) that the contribution has been collected
• make the refund claim within a year from the end of the financial year that the contribution was collected.

Refunds from the 2008 vintage must be submitted from 1 July 2008 to 30 June 2009.

The 2008 vintage refund forms will be posted on this web page before 30 June 2008.  

If you claim and receive a refund, you cannot receive direct benefits or services funded by payments from a wine fund for two years.

Ultimately, you have to determine whether you will contribute to a Wine Industry Fund to enjoy the benefits of an industry group's investment in its future.

DISCLAIMER

Although all reasonable care has been taken in the preparation of the information contained in this document, it has been provided in good faith for general information only. No warranty, express or implied, is given as to the completeness, correctness, accuracy, reliability or currency of that information.

The information in this document is not intended to be exhaustive or to replace the need for persons interested in such information to make their own enquiries or to seek independent advice.

The information contained in this document is provided on the basis that the Crown in right of the State of South Australia accepts no liability for any loss or damage caused or arising from the use of the information contained in this document.

For further information about Wine Industry Funds, contact:

Simon Treloar
Specialist Policy Officer - Grape & Wine

Primary Industries and Resources SA
101 Grenfell Street
ADELAIDE SA 5001

Telephone: +61 8 8226 3517
Email: treloar.simon@saugov.sa.gov.au