Addressing the harmful use of alcohol - WHO Western Pacific Region

Addressing the harmful use of alcohol : A guide to developing effective alcohol legislation
This approach is already being tried by some towns. The local licensing board for Perth,
Scotland, has set minimum prices since 2002 as a standard condition of its off-licences
(Scottish Government 2008). In Oldham, Yorkshire, to reduce recent increases in alcoholrelated
violence, the city council is reviewing the on-licences of 22 bars and nightclubs
selling cut-price drinks and threatening to exercise its legal power to restrict other aspects of
operation unless the bars voluntarily adopt a minimum price of 75 pence (U.S. $1.18) a unit
(Bilton 2009).
Issues to consider
Competition policy and trade
Regulating a minimum price of alcohol in the interests of public health may appear to run
counter to other policies, such as market competition or reducing barriers to trade. However,
the policy treats all products equally, dictates the bottom of price scale only and does not
affect other aspects of fair competition.
Pricing policies may be opposed by some sectors of the alcohol industry as interfering in
local and global markets. For example, a producer group, the Scottish Whisky Association,
suggests Scotland’s proposed policy would contravene European Union trade rules. In the
1970s, the European Court of Justice considered minimum pricing would prevent imported
products with lower cost structures from exercising a legitimate price advantage (Northern
Ireland Assembly 2009). However, recent European Union rulings have upheld other restrictive
alcohol policies, provided they treat all imported and domestic products equally. In principle,
restrictive measures to protect public health can be defended under international law if the
government goals are clear, a range of options has been explored, there are good reasons to
prefer the option proposed and there is evidence that it will achieve the goals.
Specialist alcohol retailers and the hospitality sector may see minimum pricing policy as
putting a level playing field under unfair competition and also increasing their profit margin on
lower-priced drinks if the margin is retained by them. For example, Scotland’s Bar Restaurant
and Dance Association does not oppose a minimum price policy if it is consistent across all
licensing districts in the country. In public submissions, minimum pricing was supported
by nearly 40% of trade and business submitters, as well as 89% of local governments and
90% of health organizations (Scottish Government 2008). Concern has been expressed that
increasing profit margin for the industry might result in increased expenditure on marketing.
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