Advocate General of the Court of Justice of the EU issues opinion on minimum unit pricing for alcohol products
On 3 September 2015, the Advocate General of the Court of Justice of the European Union (EU) published his opinion as to the legality of minimum unit pricing under EU law. Minimum unit pricing involves setting a minimum retail price based on alcohol content.
As regards the main issues, the Advocate General concludes that "a Member State can choose rules imposing a minimum retail price of alcoholic beverages, which restricts trade within the European Union and distorts competition, rather than increased taxation of those products, only on condition that it shows that the measure chosen presents additional advantages or fewer disadvantages by comparison with the alternative measure" (1).
According to Dr Peter Rice, WHO Consultant and Scottish Health Action on Alcohol Problems (SHAAP) Chair, "Minimum Unit Pricing is a measure that has very strong support among doctors and other health practitioners in Scotland who see the harmful effects of alcohol in our everyday work. Twenty Scottish people die every week from the effects of alcohol. Much of this comes from the cheapest alcohol. As clinicians, we welcome the Advocate General's opinion as a step towards implementing Minimum Unit Pricing as soon as possible. We are confident that Minimum Unit Price has substantial health improvement advantages over other possible price mechanisms and is therefore legal" (2).
Use of minimum price policy to reduce alcohol use
A minimum price policy is one of the options outlined in the European action plan to reduce the harmful use of alcohol 2012–2020. Compared to increased taxes, introducing a legal minimum price per unit of alcohol may be more likely to ensure that price changes result in a desired change in the retail price, since alcohol producers and retailers can offset tax increases by not passing on the tax increase to the consumer.
Following the final ruling of the Court of Justice, which has not yet been released, the case will be referred back to the Court of Session in Scotland.
Background
The case was initially brought before the Scottish Court of Session as a result of a challenge by several associations of alcohol producers in response to legislation passed by the Scottish Parliament in May 2012 setting a minimum unit price of 50p. The case was rejected by the Scottish Court in 2013 who found in favour of the minimum unit pricing legislation. The producers appealed this decision.
As part of the appeal hearing, the Scottish Court asked the Court of Justice to provide guidance as to whether minimum unit pricing legislation is compatible with the EU's common market organization for wine and the Treaty on the Functioning of the EU's provisions of free movement of goods; and whether, under EU law, it is permissible for a Member State to implement a new measure like minimum unit pricing in preference to using existing powers to raise alcohol taxation.
