The Scottish Mail on Sunday and Linear Pricing of Alcohol

SOME COMMENTS ON A RECENT SCOTTISH MAIL ON SUNDAY ARTICLE: “THE BARGAIN BOOZE BONANZA”, AND LINEAR PRICING OF ALCOHOL PROMOTIONS IN SCOTLAND

I was interested to read the Mail on Sunday article entitled “The Bargain Booze Bonanza” published on 2 August 2015. The article was first drawn to my attention by Jack Cummins via the @SLLPOnline twitter feed. My thanks to Jack for providing me with a link to the article here: http://www.pressreader.com/uk/the-scottish-mail-on-sunday/20150802/281779922836664/TextView.

Like many media articles on alcohol, there is much confusion and inaccuracy. This article regrettably is no different. The interpretation of Schedule 3 to the Licensing (Scotland) Act 2005, which contains the mandatory conditions which apply to all licences including a list of banned “irresponsible” promotions, has and will continue to be a talking point for legal practitioners. Some licensing areas state that certain promotions are unlawful, whilst others do not. Some licensing agents may disagree with the interpretation of what is or is not an irresponsible promotion.

There are a number of promotions referred to in this article as illegal on which I do not concur but I am narrowing the scope of this particular blog to the issue of pricing of single and double measures. The article calls these “Go large” measures. This is sometimes referred to as upselling or doubling up. The article says offering a double for any less than twice the price of a single is said to be “in clear breach of the law”.

Contrary to what is stated in this article, it is perfectly legal to have a double measure at a price which is less than twice the value of a single. What is illegal is where a premises tries to “upsell” the larger measure. So, if I ask for a rum and coke and the barman asks “Do you want to make that a double for an extra £1”, then that would be in breach of the Act. But simply having a price list and allowing the customer to make his or her own choice about whether they wish a single or a double is not, in my view, illegal. This particular point should be well settled by now. The 2005 act has not imposed “linear pricing”. That was clearly mentioned in Parliamentary debates at the time. On 20 September 2005 George Lyon MSP said that the then Scottish Executive had taken legal advice on whether Schedule 3 imposed linear pricing, and that advice was it did not. The purpose was not to introduce linear pricing, but deal certain promotional activity instead. The SBPA argued that it did introduce linear pricing, which the Executive rejected. An OFT complaint was pursued by the SBPA at this time, but it was also rejected on the basis that the OFT did not believe challenging the then Licensing (Scotland) Bill was within their remit (see “OFT Rejects Linear Pricing Complaint” [2005] 32 SLLP 13-14).

Licensing boards across Scotland have local policies which confirm that linear pricing in this context is a misnomer. The Perth & Kinross Licensing Board, for example, states in its current policy: “For the avoidance of doubt, the Board does not consider that there must be linear pricing of alcohol according to the size of measure.” 

The relevant paragraph 8(2)(c) of Schedule 3 to the Act states that an irresponsible promotion includes one which: “involves the supply free of charge or at a reduced price of one or more extra measures of an alcoholic drink on the purchase of one or more measures of the drink“. Having a double measure for less than the cost of two singles does not offend this provision: the larger measure is merely available at a certain price; it is not conditional on the purchase of one or more measures of the drink. It therefore only becomes irresponsible, in my view, if the barman tries to upsell the larger measure, which offends a separate provision under paragraph 8(2)(e) which states a promotion is irresponsible if it “encourages, or seeks to encourage, a person to buy or consume a larger measure of alcohol than the person had otherwise intended to buy or consume“.

There is a difference then in my mind between an advert or promotion which merely confirms the price of certain measures, compared to one which “pushes” the larger measure in some way. However, a degree of common sense should also be applied here. I do not think that, for example, upon approaching a bar having finished my half pint of ale the barman is committing an offence by asking me if I wish the “same again”, as some licensed trade trainers reportedly taught in the early days of the 2005 Act.

The Alcohol etc (Scotland) Act 2010 introduced partial linear pricing for multipack deals, but this does not apply if the single of product is not stocked (ie a four pack of beer is not caught unless individual cans of the same volume are sold), nor does it apply to multiples of multipacks. This gaping hole in the legislation, another example of woeful drafting when it comes to licensing law, has been remarked upon by me and others for some time. The Law Society of Scotland licensing sub-committee flagged this up to the Scottish Government before the 2010 Act was passed but to no avail. A new Bill, laid before Parliament by Dr Richard Simpson, contains a clause which would seem to close this particular gap: the Alcohol (Licensing, Public Health and Criminal Justice) (Scotland) Bill, which is discussed in my blog here.

If you require guidance or assistance on what may or may constitute an irresponsible promotion please contact me at stephen.mcgowan@tltsolicitors.com.

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About Stephen McGowan

Leading Scottish licensing solicitor at TLT. Chairman of BII Scotland.
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