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We invite comments on the proposed minimum price of 50 pence per unit which is set out in the draft Scottish Statutory Instrument at Annex A.

We invite comments on the proposed minimum price of 50 pence per unit which is set out in the draft Scottish Statutory Instrument at Annex A .
The Scottish Wholesale Association welcomes the introduction of Minimum Unit Pricing and supports the minimum price of 50p per unit. We believe this price point is proportionate. We understand the Scottish Government's intention to make progress on an early implementation of the MUP following years of delays however Scottish Wholesale Association members most affected by the policy have serious concerns about the practicality and achievability of an implementation date of 1st May 2018. We appreciate the opportunities given to SWA and wholesale businesses in recent weeks to discuss these concerns with the Scottish Government. We are keen to see MUP implemented as smoothly and successfully as possible. Previous changes affecting the trade, for example plain packaging of tobacco products, have included transition periods. This allows suppliers, wholesalers and retailers to plan effectively. Our main concern is that an implementation date of 1 May 2018 , which will only be days after the SSI will be passed by the Scottish Parliament, doesn't allow sufficient time for wholesalers, suppliers and retailers to make the IT , labelling, pricing and promotions changes which have to be made to deal with the new MUP. Wholesalers who sell to both trade and non trade will be particularly affected and may have to introduce dual systems to ensure members of the public pay the correct price. However there remains a lack of clarity around the legality of the required licensing arrangements. We retain concerns on the following issues 1) Communication with trade regarding implementation date Until the SSI is approved by the Scottish Parliament wholesalers and others within the alcohol trade cannot be sure that 1st May 2018 will be the implementation date. The food and drink industry plans months in advance in terms of promotions, product stock levels and business logistics. The Scottish Wholesale Association welcomes the opportunity extended by the Scottish Government to work with officials on guidance and information materials for wholesalers and for communication with customers at point of sale. 2) Trade actions required prior to implementation Potentially from 1st May 2018 retailers and any wholesalers selling to non trade will need to sell alcohol at MUP or above. Implementation will require our members and their suppliers and customers to take certain actions. Prior to implementation our members will have to alter IT systems if they sell to trade and non trade customers as well as to reflect the realities of cross border price differences. This may also have implications for warehouse storage space and the picking of items for sale or delivery e.g pre priced packs of alcohol might sell for different prices on either side of the Border. Retailers and wholesalers covering the UK will be able to move stock around to deal with the effects of the new MUP. Smaller Scottish based businesses will not be able to do so. MUP will hit particular products e.g high strength ciders and stores which have previously bulk purchased such stock may be hit financially as a result. 3) Licensing implications The Scottish Wholesalers Association notes that MUP will be imposed by way of a mandatory condition attached to all premises licences issued under the Licensing (Scotland) Act 2005. A significant portion of our members hold premises licences to facilitate the sale of alcohol to non-trade members including staff. It will be essential that wholesalers, despite the existence of a premises licence, can continue to sell alcohol to trade at a trade price that is not captured by MUP. From speaking to our members we know that there is significant confusion as to a premises ability to, in effect, have a dual pricing structure with alcohol being sold to trade at a trade price on terms below MUP. By way of example there is an existing belief on the part of many of our members that those who hold premises licences must comply with the licensed hours and conditions such as a bar on irresponsible promotions. If this belief is followed through then a dual pricing structure would be illegal. While this confusion has long existed, the introduction of MUP has focused minds. We understand that the basis for this concern may flow from the interaction between Sections 1(1) and (2) and section 117 of the 2005 Act. Whereby there may be an interpretation where alcohol sold on licensed premises must comply with the premises licence unless the premises is used exclusively for the purposes of selling to trade. Whilst we understand and recognise that it is for our members to take their own independent legal advice in this matter, we urge the Scottish Government, for the sake of clarity, to deal with this point in its non-statutory guidance and to continue to liaise with the SWA on this matter. We would respectfully submit that given enforcement, in the main, will be carried out by licensing standards officers from 32 local authorities, it is sensible to make sure that the correct approach to the interface between alcohol sales to the public and the trade is clarified. This will avoid unnecessary enforcement action being taken by licensing boards and the associated uncertainty that is unhelpful for the industry and licensing boards. Initial discussions with Scottish Government officials have been useful but we require assurances that the implementation date will properly acknowledge and accommodate these logistical and licensing implications for wholesalers and other businesses in the alcohol supply chain.

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Scottish Wholesale Association