Malaysian authorities clear craft brewery 1602 in smuggling case

A Malaysian craft brewery that says it was the country’s first licensed producer of its kind has been cleared after a police investigation into suspected smuggling, ending a case that had drawn attention across the local beer industry after a large raid earlier this month.

The brewery, 1602, said Malaysian authorities returned all products and equipment seized during the operation at its warehouse in Kuching, in the state of Sarawak, after the Attorney-General’s Chambers found no wrongdoing. The company said the decision allows it to continue production, sales and other business activities without interruption.

The investigation followed a July 3 raid ordered by Bukit Aman’s Wildlife Crime Bureau and Special Investigation Unit. At the time, officials said the case was being examined under Section 135 of Malaysia’s Customs Act 1967, which covers offenses including possession or handling of uncustomed or prohibited goods and evasion of customs duties.

1602 was officially founded in February 2023 by Malaysian brewer Randy Liew and German brewer Hans Gerner. Its range includes Pale Ale, Lager, Extra Dark and Wheat Beer. The company has described itself as Malaysia’s first craft beer brewery and has said throughout the case that its beer is brewed locally in Kuching rather than imported.

In a statement reported by The Drinks Business, managing director Datuk Seri Vincent Lee thanked the Royal Malaysia Police for what he called a “professional, efficient and impartial investigation.” He said the findings confirmed that 1602 had not committed any smuggling offense and that all seized goods were lawfully returned.

Lee said the brewery had provided investigators with its brewing, wholesale and liquor sales licenses, along with tax records, to show that all required duties and taxes had been paid. He had previously argued that products legally made in Malaysia and fully tax-compliant should not have been treated as suspected smuggled goods.

The case had gained notice after local reports described the raid as one of Sarawak’s biggest smuggling busts. Sarawak Tribute reported that authorities seized RM26.6 million worth of what was described at the time as contraband beer and heavy equipment. Senior Bukit Aman officer Yusri Hassan Basri had said officers found tens of thousands of cartons of 1602 beer on which duty had allegedly not been paid. Three Indonesian men, all about 35 years old, were arrested during the operation.

The clearance removes an immediate legal cloud over 1602 and may ease some of the financial pressure tied to seized stock and equipment. For brewers and other drinks companies in Malaysia, the case also underscores how important customs records, tax documentation and licensing can be when authorities scrutinize alcohol production and distribution. In a sector where delays, confiscations and regulatory disputes can quickly disrupt supply and raise costs, the outcome may be watched closely by smaller producers trying to expand in tightly regulated markets.