Legal threat over high-strength ban

13 November, 2013

Suppliers have warned they may take action against councils for breaking competition law by pushing retailers to strip shelves of premium beer and cider.

Nigel McNally, managing director of Brookfield Drinks, which markets 9% abv Kestrel Super lager and 7.5% Diamond White cider, said local authorities could be bankrupted by the compensation they would be forced to pay out if they lost. Hundreds of off-licences, including the East of England Co-operative, have taken beers and ciders as low as 5.5% abv off their shelves as part of a drive to tackle street drinking, and in some cases the ban has been enshrined in premises licences.

But producers believe the schemes are illegal. McNally said: “People are being affected commercially, and when that hap- pens companies will respond, probably collectively. Councils will be challenged and claims brought. Some councils could potentially go bust if it’s demonstrated it’s illegal, and that’s been our advice.”

Gordon Johncox, managing director of Aston Manor Brewery, which produces 7.5% Frosty Jack’s cider, added: “According to our advice super-strength bans could be breaking competition law if there is a concerted agreement between competing parties. If the local authority facilitated a dialogue it could be seen as illegal.

“A bigger issue is we’re hearing retailers feel coerced into participating, fearing they may jeopardise licences if they don’t.”

OLN surveyed hundreds of retailers across the UK and 74% said they were opposed to the ban, with just 17% in favour.

Henry Chevallier-Guild, managing director of Aspall Cyder, said: “Right now it’s a matter of sitting down with everyone involved and convincing them we want to tackle street drinking problems too, but in a way that gets long-term results. If that doesn’t happen we may be left with no alternative, and we have already taken legal advice.”

The British Beer & Pub Association raised concerns about a possible breach of competition law in a letter to the Office of Fair Trading last month, and the National Association of Cider Makers is calling for a clarification of the legal position.

Inspector Andrew Mason of Suffolk Constabulary, which launched the Reducing the Strength initiative in Ipswich last year, is confident it’s legal.

But the OFT said: “We will consider any possible competition infringements under our powers within the Competition Act of 1998.”

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