For the first time, an alcohol industry trade association has expressed support for the states’ right to legalize recreational marijuana. The Wine and Spirits Wholesalers of America (WSWA) announced the policy shift in a recent press release. The WSWA represents wine and liquor wholesalers in all 50 states and the District of Columbia. The 370 companies that make up the group distribute more than 80 percent of the alcohol that is sold wholesale in the U.S.

The WSWA called on the federal government to respect the right of states to legalize cannabis. The trade group also noted that the legal marijuana market generated more than $7 billion in economic activity in 2016. Dawson Hobbs, the WSWA Acting Executive Vice President for External Affairs, compared the fledgling legal cannabis economy to his industry’s challenges of the 1930s.

“Eight decades ago, Americans acknowledged that the Prohibition of alcohol was a failed policy. The state-based system of regulation, adopted after Prohibition, created a U.S. beverage alcohol market that is the safest, most competitive, and best regulated in the world,” he said.

Regulation is Key

The WSWA said that cannabis should be regulated similarly to alcohol, and included a specific list of recommendations. The group holds that recreational cannabis should be limited to adults 21 years of age and older. The association also calls on governments to establish standards to define impaired driving.

The state should license all manufacturers, processors, distributors, and retailers, according to the WSWA, and prohibit monopolies and vertical integration of licensees. Regulation should include restrictions on sales and delivery by common carriers. States should also create systems to ensure that all products in the market can be tracked and traced to their source processor or producer.

The group also wants restrictions on advertising and hours of sale similar to those for alcohol. Potency and safety testing should be required and health claims on packaging banned, the group says.

The WSWA also called for recreational cannabis to be taxed and enforced. Penalties should be on par with those for the alcohol industry, according to the association.

Big Shift for the Industry

So far, the WSWA is the only alcohol trade group that has expressed a new attitude toward cannabis. The adult beverage industry has a track record of opposing cannabis legalization efforts. The Arizona Wine and Spirits Wholesale Association contributed $10,000 to a group fighting a legalization initiative on that state’s ballot in 2016. The same year, the Beer Distributors PAC in Massachusetts gave $25,000 to the anti-pot group Campaign for a Safe and Healthy Massachusetts.

Leaders in the alcohol industry have admitted that they see legal cannabis as a threat to their companies’ bottom line. Sam Adams parent The Boston Brewing Company admitted in a financial filing that cannabis legalization could “adversely impact the demand” for beer.

And the makers of Jack Daniels whiskey and Finlandia vodka, the Brown-Forman Company, warned investors that “consumer preferences and purchases may shift due to a host of factors, many of which are difficult to predict, including … the potential legalization of marijuana use on a more widespread basis within the United States, and changes in travel, leisure, dining, gifting, entertaining, and beverage consumption trends.”