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30/08/2016

Minimum pricing on alcohol still debated after court ruling

Agriculture & Food

Minimum pricing on alcohol still debated after court ruling

A pub in Edinburgh, Scotland.

[Ken Douglas/Flickr]

Introducing minimum pricing unit (MUP) on alcohol in the EU will likely restrict the single market, the Court of Justice (ECJ) ruled just before the Christmas break.

However, some member states are still considering following Scotland’s lead, and enacting such a measure.

On 23 December, the Court said that the Scottish legislation of imposing a minimum price for alcohol, initially to be set at 50p per unit, will “restrict the market”, and that the country instead could introduce a “tax measure designed to increase the price of alcohol”, but that in the end, the national court in Edinburgh should decide. 

In Ireland, where the government has recently announced similar plans to Scotland’s MUP, at €1 a unit, Health Minister Leo Varadkar indicated that Ireland will proceed with the measure.

>>Read: Ireland unveils minimum alcohol price plan to reduce drinking

In Denmark, shortly after the ruling by the ECJ, the Danish Medical Association called on the government to set a minimum price on alcohol in order to help tackle youth binge drinking.

“Our great alcohol consumption is a serious societal problem and there is no doubt that it’s too cheap to buy alcohol in Denmark when you can get a bottle of hard liqueur for 70 Danish crowns (€9.38),” Andreas Rudkjøbing, the chairman of the association, told the Berlingske Tidende.

While Health Minister Sophie Løhde declined to introduce a MUP bill as “it would not have a big impact on public health”, alcohol analyst Henrik Rindom disagreed, saying that an MUP could have a big impact, but only if it was introduced across the EU.

“I would really like to see EU member states deciding together to raise the price on alcohol so that the cheapest litre of beer would at least cost the same as one litre of milk in the whole of the EU,” he said.

“But one country moving ahead alone will not make much difference when you can just cross a border to get a beer for €0.3. It would only increase border trade,” Rindom added.

It was the Scotch Whiskey Association which initially challenged the Scottish government’s MUP plans in 2012. 

Paul Skehan, Director General of Spirits Europe, which represents the spirits and liqueur industry at EU level, said in a statement that “instead of wasting more time debating the illegality of MUP, we believe it would be far better to discuss useful, legal ways of tackling the alcohol-related issues that persist, not only in Scotland, but around the EU”.

Positions

Nicola Sturgeon, the First Minister for Scotland, tweeted: 

"ECJ opinion on minimum pricing welcome. We believe it is the most effective way of tackling alcohol misuse. National court will now decide."

Ian Duncan, a Conservative Scottish MEP, commented: 

“The Scottish Government have put all their eggs in one basket and have fallen foul of EU Law. The early warning provided by the EU Advocate General in September should have set alarm bells ringing in Edinburgh. I hope the Scottish Government will publish their Plan B as soon as possible.”

Background

In Scotland, legislation was passed in May 2012 introducing a minimum retail selling price for all alcoholic beverages, based on strength and volume, the first of its kind in the European Union. A Minimum Unit Pricing (MUP) at 50 pence (€0.69) per unit was introduced.

The aim is to reduce harm to society and to individual health from excessive or abusive consumption of alcohol. According to the Scottish government, the impact of excessive consumption is estimated to cost £3.6 billion (€7.97bn) per year, equivalent to £900 (€1,242) for every adult in Scotland, who buy on average almost a fifth more alcohol than their English and Welsh counterparts.

Scotland's alcohol policy was challenged by the sprits and wine industry, which filed a court case against the minimum pricing policy. The Scottish high court turned it down, saying minimum pricing act was not outside the legislative competence of the Scottish Parliament.

>>Read: Scotland wins court case on minimum pricing of alcohol

Spirit and wine makers appealed that ruling before the European Court of Justice. In his opinion to the court, Advocate General Yves Bot said that a member state can impose a minimum price, but only if this system was superior to an alternative measure.

In other words, Scotland's plan to introduce a minimum price for alcohol risks breaching EU law because it restricts trade and distorts competition. Edinburgh might therefore have to explore other ways to protect public health such as increasing tax, the advocate general said.

>>Read: Scottish minimum alcohol pricing may breach EU law

A final ruling by the ECJ on the Scottish law is expected at the beginning of 2016.

>>Read also our LinksDossier: Fighting alcohol harm: The EU's strategy under review

Timeline

  • 2016: The national court in Edinburgh to make final decision on minimum pricing unit.

Further Reading