“By just we mean that which is legal, transparent and equitable.” Aristotle
In the early beginnings of the Captaincy General of Guatemala, with the settlement of the Royal Court in 1578, all fermented beverages were considered illegal. Production of these beverages was fought and halted during the sixteenth, seventeenth and eighteenth centuries. It is very likely that the reason behind this prohibition was not so much due to the beverage in itself, but to the lack of hygiene controls to oversee the production process. More likely, it was due to the fact that there was no clear legislation in place regarding the production of beer, which was being produced freely and without controls and therefore, did not generate revenues for the Royal Treasury.
Starting in the sixteenth century, there was an historic change to the existing laws that regulated the production as well as the sale and consumption of alcoholic beverages in Guatemala.
The production and sale of chicha (a local fermented beverage produced from maize), was forbidden in 1635. Fines could run up to 100 ducats for Spanish offenders, and 100 lashes for indigenous offenders, inflicted in public to detract others tempted to do the same.
The manufacturing and marketing of aguardiente, (a liquor literally meaning “burning water”), obtained from sugar cane was also penalized. If caught in the act, the offender had to pay a fine of one thousand pesos the first time; double if caught a second time, triple and banishment if caught a third time, as stipulated by Royal Decree dated June 8, 1693.
In regards to the production of wine, Friar Francisco Ximénez, a Dominican priest and presbyter of Chiapas, in his writing “Historia Natural del Reino de Guatemala” (Natural History of the Kingdom of Guatemala), written during his curacy in Zacapulas-Quiché wrote the following reference:
“The vines from Castile do very well here and in the Kingdom of Lima, and very good wine is made in New Spain and the same can be said for out of this land, as done by a religious man of this province, Friar Juan de San Joseph, who planted many vines in the town of Cunén, San Miguel and the mountains of Zacapulas and produced wine for his own consumption. There are other vines in this land that is called highlands, and are produced in abundance in mild and warm soils which is a true blessing from God.”
Historian, Rubio Sánchez maintains that from the year of the Conquest in 1524, until the independence in 1821, beer was produced during eight years. It is a fact that permission to produce beer in the very loyal and noble city of Santiago de los Caballeros de Goathemala , but not in other provinces, was granted to Antonio Rodríguez in 1738. There is mention of another request made unto the Cabildo (Municipal Council), on September 9, 1729 by Carlos Antonio Vadis, whose petition to produce it was denied.
The alcalde ordinario, (traditional Spanish Municipal Magistrate), Bartholomé de Eguizabal, a merchant who facilitated the importation of wine and pisco from Peru, saw competition in the commercialization of beer. Using his official position, he gave instructions to the Municipal Council members to collect all previously granted licenses to small beer producers with the consequent harm it may have entailed. Wines coming from Peru were successfully commercialized and sold in Panama and in Goathemala. In light of that measure, and the harm it would cause them, brewery owners exerted economic and political pressure. The government decided to modify the law again by issuing a code of regulations on August 23, 1746 that allowed the production, consumption and sale of alcoholic beverages. In spite of this, the number of taverns was reduced to only 14. There is no indication of how many of these establishments existed before that date.
The scope of the license scope was limited to the importation and sale of wines and aguardiente from Peru, the Caribbean islands and Spain, it excluded the sale of mistelle, or sweet wine, produced in the Captaincy General and it was explicitly for Spaniards and creoles, it excluded “indigenous people”, who generally consumed the more local chicha. This beverage was being produced since Prehispanic times, and it is believed it was used during religious ceremonies. Even though the disposition was due to and motivated by its lucrative potential, it was justified with a moralizing message given the high consumption of those beverages, especially among indigenous people.
Even though these instructions come from the beginning of Colonial times, they did not gain strength until the end of the eighteenth century, when wine merchants requested the validity of the Royal Decree issued on June 8, 1693. The request was largely ignored.
Chicha was another, less strong, everyday beverage, that was served with food or drank by itself, and was considered nutritious at the same time. Women were predominantly responsible for producing Chicha by chewing up corn, so that the naturally occurring ptyalin in the saliva would breakdown the starch into malt sugar, thus fermenting it.
Since the era of Mayan Culture, a dark and thick type of beer was produced made from corn fermented in clay pots called saká. The production of this type of beer was also intervened during the Colonial period.
Spanish wine merchants rejected the production of beer, viewing it as a threat to their businesses and thriving commerce, as well as detrimental to Hispanic agriculture in general. With the sole purpose of defending their interests, they used every means possible to stop the fledgling beer industry and sought out the support of Spanish authorities in order to protect their business.
In order to obtain more funds for the precarious Central American government coffers, the government approved, in 1821, the production and sale of alcoholic beverages. Both aguardiente and chicha were being sold in the early days of the Colonial period in establishments known as chicherÍas. It is unknown if in the Kingdom of Goathemala that name was used to refer to establishments that distributed the beverage, it is only clear that the authorizations for its sale were done through an auction method according to the practices of the Viceroyalties of New Spain and Peru.
Granting the permission caused the unlimited proliferation of these establishments, which quickly led to the high consumption of liquors, especially in localities with high indigenous populations. At the same time, it increased tax collection which became extremely important for tax administrators given that surgeons, doctors, lawyers and sellers of aguardiente all paid the same amount: five pesos per license. The different government’s stance towards liquor was ambivalent. On one side, they promoted legislation that punished inebriation, and on the other, they made efforts to pursue contraband and clandestine production. Both activities meant less revenue for the treasury. Beer, however, was not included in this listing.
In 1832, Guatemala’s Head of State, Mariano Gálvez, ratified authorizations for the sale of chicha as well as other alcoholic beverages, always selling off to the highest bidder. This sector represented the largest percentage of tax collection during 1839. Total given revenues that year amounted to 51,958 pesos, equivalent to 40.5% of total tax collection.
During the two years that Miguel García Granados was President of Guatemala he advanced several tax related measures. Among which, Decree No 19, enacted in October of 1871 stands out. The law revoked protectionist laws, decrees and resolutions directed to the production and sale of imported liquors. At the same time, monthly quotas for the distillation and sale of aguardiente and chicha were established.
President Barrios later issued Decree No. 175 that modified the one enacted in 1871. The objective of this new law was to avoid insofar as possible, tax evasion and look after public morality. In regards to the production of beer, it stated the following,
Art. 1 The production and sale of aguardiente, chicha and beer as well as the sale of liquors imported into the country, may be done by anyone as long as they pay the tax as established by this law and comply with the provisions of this law in its relevant parts.
Art. 33 Those who wish to establish beer factories may do so by meeting the following conditions:
Art. 34 Licenses shall be granted for one or more months, being understood that once granted, that month shall be considered as concluded, even when, for any reason, the license is not in use.”
Protectionist laws decreed by then President Justo Rufino Barrios, promoted and protected the beer and liquor industries by granting fiscal incentives and protection on imposed tariffs. These resolutions remained in effect, with some later reforms, until the resignation of general Jorge Ubico in 1944. During that period, said laws benefitted the incipient beer and liquor companies, giving all companies that operated or were created during the time of that legislation an equal opportunity for development.