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Judge upholds alchohol pricing law

3 May 2013

The legislation setting a minimum price per unit of alcohol is not outside the legislative competence of the Scottish Parliament, a Court of Session judge ruled today.

Lord Doherty rejected a challenge by the Scotch Whisky Association (SWA), along with European alcohol producers, to the legality of the Alcohol (Minimum Pricing) (Scotland) Act 2012 and the Scottish Ministers’ decision to make an order setting a minimum price of 50p per unit of alcohol, holding that the measures were within devolved competence.

The petitioners' case was (1) that the Act and the ministers' decision were in breach of the Acts of Union provisions on freedom of trade; (2) that the Act was outside the legislative competence of the Scottish Parliament in purporting to modify those provisions, contrary to the Scotland Act 1998; (3) that the Act was also beyond the Parliament's competnece because it was incompatible with EU law, in that it contravened the Treaty on the Functioning of the European Union (TFEU), and the common organisation of the market in alcohol; (4) that, for the same reasons, the proposed order would, if made, be outside devolved competence and beyond the powers of the Scottish ministers.

Lord Doherty, who heard seven days of argument in late January, rejected all the grounds of challenge. The Acts of Union, he said, did not require a single internal market between Scotland and England with common laws and conditions relating to trade applying in each country, and the alcohol measures did not restrict freedom of trade or give any preference in trading conditions to traders.

Regarding EU law, minimum pricing was not in itself necessarily contrary to the Treaty. In so far as the measures had equivalent effect to quantitative restrictions on imports (article 34 TFEU), they were justified on the grounds of the protection of the life and health of humans (article 36).

National authorities retained competence to introduce minimum pricing notwithstanding the fact that there had been a degree of EU common organisation of the market in respect of wine and other alcohol products. The measures were not prohibited by, nor did they undermine, the relevant EU regulations. There was objective evidence that they were appropriate to achieve their aims; and the alternative of raising excise duties would be less effective as it would not have the desired effect on cheaper products without making other products very much more expensive, affecting moderate drinkers and the on-trade more.

He also declined to refer any question of EU law to the EU Court of Justice for a preliminary ruling.

Click here to view the opinion.

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