Minimum Alcohol Pricing: Balancing the ‘Essentially Incomparable’ in Scotch Whisky
| Published date | 01 September 2018 |
| Author | Niamh Dunne |
| Date | 01 September 2018 |
| DOI | http://doi.org/10.1111/1468-2230.12368 |
Minimum Alcohol Pricing: Balancing the ‘Essentially
Incomparable’ in Scotch Whisky
Niamh Dunne∗
This note contrasts the approaches taken by the Court of Justice of the European Union and
the UK Supreme Court in the high-profile litigation which preceded the introduction of
minimum alcohol pricing in Scotland. The case of Scotch Whisky Association and others vThe
Lord Advocate and another hinged, ultimately, on the necessity of minimum pricing to achieve
important public health goals. The notably differing viewpoints adopted by the domestic and
Union courts, however, both illustrate the elusiveness of the proportionality criterion, and
expose tensions between domestic and supranational control in the context of internal market
regulation.
INTRODUCTION
Whisky may traditionally be the ‘water of life,’ yet it is recognised as hav-
ing, together with other alcohol products, a notably malign impact within
contemporary Scottish society. Curbing excessive consumption has long been
a prominent policy concern of the devolved Scottish Parliament. Minimum
pricing regulation, whereby retailers are prohibited from charging below a
specified price-per-unit of alcohol sold, was identified as the lynchpin of a
comprehensive public health strategy aimed at reducing alcohol-related harms.
Yet minimum pricing rules potentially conflict with the ‘open and undistorted
competition’ ostensibly guaranteed by the EU free movement provisions, thus
exposing tensions between market and non-market objectives, and between
domestic and supranational control.
This case note explores the contrasting approaches taken in the case of Scotch
Whisky Association and others vThe Lord Advocate and another by the Court of
Justice of the European Union (CJEU)1and the UK Supreme Court,2re-
spectively. Here, public health concerns were invoked to defend the Alcohol
(Minimum Pricing) (Scotland) Act 2012 (2012 Act), in order to justify deroga-
tion from the free movement of goods guaranteed by Article 34 of the Treatyon
the Functioning of the European Union (TFEU). In upholding unanimously
the legality of this legislation, and thus paving the way for the introduction of
minimum pricing from May 2018, a seven-judge panel of the Supreme Court
sidestepped urgent, yet arguably rather ill-considered, concerns identified by
the CJEU regarding the perceived necessity of the national measures. The case
∗LSE Law. Many thanks to an anonymous reviewer for their helpful comments on an earlier draft.
1 Case C-333/14 Scotch Whisky Association and others vThe Lord Advocate and another
EU:C:2015:845.
2Scotch Whisky Association and others vThe Lord Advocate and another [2017] UKSC 76.
890 C2018 The Author. The Modern Law Review C2018 The Modern Law Review Limited.
(2018) 81(5) MLR 874–905
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Niamh Dunne
thus raises important questions about, inter alia, the scope of the free movement
of goods prohibition, the approach to proportionality under EU law, and the
application, and implications, of EU law within devolved national government
structures.
FACTS AND EVOLUTION OF THE DISPUTE
The public health concerns that motivated passage of the 2012 Act are well-
known within popular culture – representing, as the Inner House of the Court
of Session put it, ‘an unfortunate, if distorted, caricature of the Scottish char-
acter’3–and meticulously set out in the numerous policy documents that paved
the way for its enactment. ‘Scotland’s alcohol-related statistics are stark’4: con-
sumption is amongst the highest in Western Europe, and a quarter higher than
in England and Wales; excessive consumption is associated with high levels of
a range of social problems, including alcohol-related hospital discharges, deaths
and criminal offences; and, even if problematic drinking is widespread across
social groups, the ill-effects of alcohol abuse are experienced most acutely
by those in poverty, meaning that excessive consumption exacerbates existing
social inequalities.
The Scottish government’s alcohol strategy involves 40 measures intended,
together, to reduce consumption while providing greater community and
individual support.5Amongst these, minimum alcohol pricing is premised
on the notion, counterintuitive from a competition policy perspective, that
lower prices are harmful to consumers: greater affordability leads to increased
consumption, which leads to increased levels of alcohol-related harms.6The
2012 Act empowers the Scottish government to set a minimum price-per-unit
(MPU) for retail sales, which takes effect as a licence condition for on-trade
and off-trade sales.
At its enactment, the proposed MPU was £0.50, a figure intended to strike ‘a
reasonable balance between publichealth and social benefits and inter vention in
the market.’7The 2012 Act was nonetheless challenged beforethe Outer House
of the Court of Session by three trade associations representing producers and
importers of alcohol products. The grounds of challenge included arguments
relating to the constraints of the Acts of Union and the limitations of the
devolved competences of the Scottish Parliament. Most important for our
purposes were several claims alleging breaches of EU law, in particular the free
movement of goods under Article 34 TFEU.
In a concise yet convincing opinion, Lord Doherty rejected the petitioners’
arguments, finding that any EU law objections were overridden by legitimate
3Scotch Whisky Association and others vThe Lord Advocate and another [2016] CSIH 77 at [178].
4 Scottish Government, Final Business and Regulatory Impact Assessment for Minimum Price Per Unit
of Alcohol as Contained in Alcohol (Minimum Pricing) (Scotland) Bill (2012), 3.
5 Scottish Government, Changing Scotland’s Relationship with Alcohol: A Framework for Action (2009).
6n4above,6.
7ibid, 10. Modelling conducted as part of the impact assessment exercise considered the effects
of an MPU ranging from £0.25 to £0.70, with, unsurprisingly, the greatest health benefits
predicted in the higher range (ibid, 54-60).
C2018 The Author. The Modern Law Review C2018 The Modern Law Review Limited.
(2018) 81(5) MLR 874–905 891
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