Europe threatens minimum pricing push
A new ruling by the European Court of Justice (ECJ) shows that minimum pricing is illegal.
That's according to the Scotch Whisky Association (SWA), in response to the ECJ ruling that minimum pricing of tobacco in Austria, France and Ireland is illegal. However, the ruling appears to suggest that action against below cost sales could be permissible.
The ruling said that the action, which saw minimum pricing set for certain tobacco products, is "contrary" to an EU competition directive.
The action "undermines the freedom of manufacturers and importers to determiner the maximum retail selling prices of their products and, correspondingly, free competition".
The SWA is campaigning against the push for minimum pricing in Scotland through the country's Alcohol Bill.
The group's chief executive Gavin Hewitt said: "Today's ruling is a major development, confirming our contention that minimum pricing breaches EU law and unfairly distorts competition.
"Given this latest evidence, the Scottish Government must now recognise the legal realities. It cannot introduce a trade barrier in breach of the UK's European obligations by imposing minimum pricing on alcohol in Scotland.
"The Court has also said that measures to prevent sales at a loss are acceptable. The SWA has said repeatedly that we are ready to work with the Scottish Government on just such a legal,alternative and transparent mechanism to address alcohol harm.
"We would urge the Scottish Government to withdraw minimum pricing from the Alcohol Bill and hope that a consensus can now be reached on tackling loss leading sales of alcohol."
The ECJ said a system of minimum retailing selling price for tobacco can't be compatible with competition law.
The only exception is if "the competitive advantage which could result for some manufacturers and importers of those products from lower cost prices is not impaired."
Significantly, though, the ECJ said: "Prohibition on fixing minimum prices does not prevent member states from prohibiting the sale of manufactured tobacco at a loss".
They could do so if "the freedom of manufacturers or importers to determine the maximum retailing selling prices for their products is not undermined".
A Scottish Government spokeswoman said: "We have already made clear that this long-running case concerns tobacco and a specific directive on tobacco. It does not relate to minimum pricing for alcohol.
"We consider that the introduction of minimum pricing for alcohol is capable of complying with European law, and we have already published an Alcohol Bill which contains measures that are entirely within the competence of the Scottish Parliament.
"There is a strong consensus in Scotland in favour of minimum pricing, and we believe that Parliament has a responsibility to act as part of a broad package to combat alcohol misuse."
