The scheme imposes a legal duty on all retailers to check that companies they buy from are legitimate members of the scheme and to obtain from them a unique reference number (URN).
An online look-up system will go live on April 1 to enable trade buyers to check the legitimacy
of wholesalers, including specialist agency portfolio importers and distributors.
Retailers will be required to periodically update their checks to make sure the status of a supplier hasn’t changed.
The scheme will not apply to sales between different divisions of the same corporate group.
Retailers who engage in any type of regular wholesaling activity – such as selling wine to local restaurants and pubs – will also need to register as a legitimate wholesaler with the scheme and will be breaking the law if they fail to do so.
HMRC’s guidance excludes from this those engaged in “incidental sales”. It gives as an example “a
small corner shop that does not in any way set out to make wholesale sales but is aware that the local pub landlord may exceptionally run out of a particular line and call in the shop to make an ad hoc purchase – this would be an exception rather than the rule and would be classed as an incidental sale”.
Penalties for wholesalers or retailers who fail to comply with the scheme’s requirements can include a fine or imprisonment of up to seven years.
The HMRC may also apply to local authorities to amend the licences of retailers found to be flouting the law and stock could be seized.
The AWRS scheme is being introduced after a long campaign by the Federation of Wholesale Distributors to persuade the government to crack down on illegal sources of alcohol supply.
FWD chief executive James Bielby said its members – principally major cash and carries and food and drink wholesalers such as Booker, Bestway and Palmer & Harvey – had all been cleared to be part of the scheme and issued with their URNs.
“Alcohol wholesalers have been inspected and assessed, and those which have been approved as fit and proper traders will have their URNs by the end of March,” said Bielby.
“By regularly checking that their wholesaler is registered and keeping a record of their checks, retailers can be sure that they will avoid the severe penalties associated with buying illicit stock.”
The Association of Convenience Stores has produced a guide for retailers on the new scheme which can be accessed at tinyurl.com/AWRSguidance.
ACS chief executive James Lowman said: “The AWRS is designed to tackle the illicit alcohol market which has a direct negative impact on responsible retailers. Retailers should prepare their businesses for the new obligations by asking their alcohol wholesalers if they have registered, and understand their obligations by using the ACS guide.”