In Depth

Minimum alcohol pricing: has Scottish government been scuppered?

European court rules measure is illegal if same benefit can be derived from tax rises

The Scottish government has been dealt a blow over one its flagship policies by the European Court of Justice, which has ruled minimum alcohol pricing could be anti-competitive and illegal.

What does the ruling mean - and can the government still go ahead with the plans?

What has happened?

Put simply, the European court has thrown a spanner in the works of plans to introduce a minimum price for each unit of alcohol north of the border, which has been the subject of a protected legal battle since it was approved by Holyrood three years ago.

The judges said that denying firms the right to set their own prices could be "restrictive" to free trade, the Financial Times notes, and that it would be "illegal if tax rises could be used instead".

What was the government planning?

A minimum unit price of 50 pence, which academic studies reckon is the best way to target the cheap, high-alcohol drinks that are frequently abused by problem drinkers. 

The plans were approved by an overwhelming majority of 86 to one in 2012, but since then have been the subject of a protected legal challenge led by the Scottish Whiskey Association that is backed by among others, nine EU member states, including France and Spain.

Has the ruling killed the policy?

No. The court has said that a minimum price would ordinarily be illegal in the European free market, but that it can be justified on health grounds if it is proportionate. 

However, the government would need to prove it cannot achieve the same result by tax rises, which "would still allow retailers to set their own prices, and compete against each other". The ruling has been passed back to Edinburgh's Court of Session for a final decision. 

What are the sides saying?

On the pro-policy side of the debate, there is caution from ministers but some tempered celebration from campaign groups. Eric Carlin, director of Scottish Health Action on Alcohol Problems, said the ruling "confirmed that minimum unit pricing… did not in itself contravene EU law".

Of course, on the other side of the debate there is similar positivity. David Frost, chief executive of the SWA, said the court "has confirmed that minimum unit pricing is a restriction on trade, and that it is illegal to choose [it] where there are less restrictive ways of achieving the same end."

For a more balanced opinion, the FT spoke to Graeme Young of the law firm CMS. He said the ECJ had set a “high hurdle” for Scottish judges and that the parameters on which they must base the decision are "heavily weighted against minimum pricing being an acceptable measure."

How does this affect the UK?

That's unclear, but there is certainly a context here. The Guardian notes the Scottish government does not have control over alcohol taxation, which is a matter for the UK government. 

Whether this simply means the government has a stronger argument for minimum pricing – that tax rises aren't a viable option – or whether this simply becomes another bone of contention for independence-seeking nationalists, is yet to be seen. 

Will the Scottish court ruling be the end of the matter?

Doubtful. The decision could still be appealed to the UK Supreme Court - and given the strong feelings on either side it is unlikely the loser will be willing to give up without trying every avenue.

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