Alcohol minimum pricing: Industry leaders fear possible trade barriers

SCOTCH whisky has benefited from European Commission intervention against discriminatory taxes in countries such as Japan, South Korea, Chile, Uruguay, India and the Philippines.

Industry leaders say that, if the Scottish minimum pricing scheme survives the legal challenge, the EC’s ability to support Scotch whisky’s fight against overseas trade barriers, however spuriously based, would be significantly undermined. By introducing trade restrictions in Scotland, it is feared the Scottish Government will undermine World Trade Organisation rules that the industry has used to help save Scotch from protectionism. Governments around the world would be allowed to introduce “health justified” measures damaging to Scotch whisky.

South Korea has previously tried to protect its local spirit, Soju, through the introduction of a “health tax” that would apply only to products above 30 per cent alcohol, primarily Scotch whisky.

The country is the eighth largest overseas market for Scotch.

Thailand has sought to remove alcohol from being included in the free trade agreement negotiations it has had with the EU. If it were able to invoke a Scottish health precedent, Scotch whisky chiefs say it would make it more difficult to challenge such protectionist moves.