TOKYO -- S hochu makers eager to take advantage of the dismantling of import barriers by the U.S. and Europe are instead running into a serious regulatory roadblock at home.

Late last year, the U.S. eased import regulations on the size of shochu bottles, allowing distillers to ship spirits in their traditional 720-milliliter and 1.8-liter bottles. Previously, they had to rebottle their liquid exports, a requirement many considered a non-tariff barrier.

The European Union relaxed its bottle size rule in 2018.

With export opportunities thus presented, more shochu makers are eyeing overseas markets.

"The world is yet to discover shochu," said a representative of Hamadasyuzou, a distiller in Kagoshima Prefecture that in May unveiled Daiyame 40, a sweet potato-based shochu exclusively for export markets.

Hamadasyuzou has designed Daiyame 40 shochu exclusively for overseas markets.

The liquor's alcohol content is 40%, roughly double that of regular shochu. The high content, CEO Yuichiro Hamada said, "makes it suitable as a cocktail base."

Kirishima Shuzo, a distiller in Miyazaki Prefecture, this summer is set to do market research in the U.S., China and Southeast Asia for the first time. The company, known for its Kuro Kirishima brand, expects potential demand from consumers who have had to spend more time at home due to the pandemic.

Yet, Japan's "color" regulation stands in the way of the wider shochu industry's efforts to market its tipples overseas. The regulation, set forth by the National Tax Agency in the 1950s, requires the color intensity of a shochu spirit to be about one-10th that of regular whisky. It was established to distinguish shochu from whisky.

The problem, distillers say, is that in Japan they are being forced to take out the amber color that overseas can be perceived as a characteristic of high-end liquor.

"Colorless drinks are not regarded highly abroad," said Rokuchoshi-syuzou President Michito Ikebe. The Kumamoto Prefecture distiller alters the color of its shochu by filtering it through charcoal.

"Exporting shochu remains difficult unless the color regulation is relaxed," said Taiki Nakayama, president of Tokyo shochu exporter Nanzan Bussan. "Regulating distilled drinks by color is rare outside Japan."

Visitors try Hamadasyuzou’s premium shochu at the Smithsonian National Museum of Natural History in Washington.

There are two shochu categories. The ko type is repeatedly distilled to remove impurities, while the otsu type uses the traditional single distilling method to retain the rich flavors and fragrances of key ingredients.

Otsu shochu can acquire an amber tinge, like whisky, when aged in wooden barrels. But under the current regulation, distillers have to filter out the color.

Regulators are not sympathetic, with one government official saying distillers have only themselves to blame. While it was negotiating with other countries to lower trade barriers, the Japanese government sounded out the shochu industry about easing the color regulation. But some makers objected, fearing the move could lead to the loss of their preferential tax treatment, the official said.

The whisky tax rate was reduced during the 1980s and 1990s in response to requests from the U.K., which was trying to expand exports of Scotch whisky to Japan. Still, the tax rate on shochu with an alcohol content below 37% remains lower than whisky's.

Some shochu makers worry that if the color regulations are removed, whisky and shochu will be treated equally, and shochu will lose its preferential status. Companies that do not have long-aging beverages in their lineup vehemently opposed the easing.

In fact, the color regulation largely lost its meaning as a way to distinguish shochu from whisky in February, when Japan defined what constitutes Japanese whisky based on the use of domestic water and other factors.

Shochu exports have been lagging behind those of other alcoholic beverages. In the decade through 2020, annual shochu exports were flat at around 1.5 billion yen ($13.5 million). Whisky exports, which in 2010 stood at a similar level as shochu's, swelled 23-fold to 27.1 billion yen in 2020, while sake exports that year hit 24.1 billion yen.

To boost shochu's overseas sales, the government in November included premium shochu in a focused export push. The target is to more than triple the value of shochu exports to 4 billion yen by the end of 2025.

Yet, some distillers are impatient, unable to sell their product as shochu. A few have started to market their tipple as liqueur by adding dietary fiber. If this practice spreads, one observer says, Japan's shochu industry could lose its credibility and thus overseas markets.

Shochu also has a battle on its hands on the domestic front, despite government efforts to support the industry. Shochu sales in Japan have shrunk about 25% in volume terms since peaking in fiscal 2007.