Supreme Court victory clears way for Scotland to introduce minimum pricing of alcohol

17 Nov 2017

Scotch Whisky Association v The Lord Advocate and The Advocate General for Scotland [2017] UKSC 76

The Supreme Court has decided that Scottish legislation which will introduce a minimum price per unit of alcohol does not breach EU free movement of goods law. Any retail seller of alcohol in Scotland will be required to ensure that an alcohol product must not be sold at a price below a statutorily determined minimum price per unit of alcohol. The current proposal is that it should be 50 pence per unit of alcohol.

The proceedings were brought by The Scotch Whisky Association and two Belgian organisations representing spirits and wine exporters. The Scottish and UK Governments were the respondents: the Lord Advocate representing the Scottish Ministers and the Advocate General for Scotland representing the United Kingdom government. The appeal turned on whether the restriction on inter-state trade created by the proposed legislation was justified on public health grounds.

The case discusses an important issue concerning the EU proportionality principle, namely whether a reviewing court should apply a separate “third stage” of balancing of interests (or “proportionality stricto sensu”) in addition to the first two limbs of “suitability” and “necessity”. The Supreme Court held that the Court of Justice had deliberately rejected the idea of a separate third stage, contrary to the view of Advocate General Bot.

The Supreme Court also considered the consequences of the Court of Justice’s ruling in Scotch Whisky on the “time of assessment” in a proportionality case. The Supreme Court considered that as the petitioners were allowed to rely on material not before the decision-maker, it would seem artificial, and even unfair not to allow the respondents to refine the “legitimate aims” previously advanced by reference to new material.

Ultimately, the issue in this case turned on the “necessity” limb of proportionality, and specifically the argument that taxation could achieve the same level of health protection but with less disruption to trade. The Supreme Court held that the court below had been entitled to find that taxation was unable to target the specific group of the drinking population the measure was aimed at as effectively as minimum pricing. It was reasonable to conclude on the basis of the evidence (including new evidence) available that there was no less restrictive measure which would achieve the state’s desired level of health protection equally effectively.

Ian Rogers QC advised various UK Government departments in the proceedings in the Supreme Court, Court of Justice of the European Union and Scottish courts. The Advocate General for Scotland (representing the UK Government) was one of the two respondents to the proceedings.The Supreme Court judgment can be found here.