Irish drinks industry welcomes Breweries and Distilleries Bill

Thursday, 15 February 2018

New legislation has potential to support craft breweries and distilleries

Industry warns that ‘progressive’ piece of legislation could be undercut by ‘disproportionate’ and ‘anti-business’ measures in Public Health (Alcohol) Bill

Alcohol Beverage Federation of Ireland (ABFI), the representative body for drinks manufacturers and suppliers in Ireland, has welcomed the progression of the Breweries and Distilleries Bill, which was debated and passed by the Oireachtas Justice Committee today. ABFI says that the new Bill, which will allow craft brewers and distillers to sell their produce onsite to visitors, could support tourism and Ireland’s small drinks businesses. It says that it will be engaging with the Department of Justice & Equality in relation to possible further amendments to the Bill to ensure it benefits all small distilleries and breweries.

However, ABFI says that the positive impact of the Breweries and Distilleries Bill could be undercut by the unintended negative consequences of the Public Health (Alcohol) Bill, which will be debated in the Dáil later today (Thursday, 15th February). In particular, it says that the labelling and advertising proposals will have a detrimental impact on craft breweries and distilleries.

The Alcohol Bill proposes health labels on all alcohol products sold in the Republic of Ireland. ABFI says that a specific Irish label would impose additional costs on producers, as drinks companies that export will have to make a separate label for the Irish market. According to DKM economic consultants, it’s anticipated that it will cost approximately €50,000 to redesign an entire suite of labelling for a single product line. DKM also suggests that these labelling requirements could represent a barrier to entry to the Irish market. As a result of the additional costs that would be imposed, products might be withdrawn from the Irish market or new products might not be introduced.

The new labelling rules will also put Ireland at odds with the rest of the EU, which could be particularly problematic during Brexit negotiations. Membership of the EU, including the single market and access to EU trade deals, is very important for Irish exporters. Central to the EU trading model are the concepts of harmonisation and avoiding barriers to trade. This is also known as avoiding 'regulatory divergence', which is something the Government highlights continuously in the context of Brexit. ABFI says that the creation of single country label requirements for drinks products completely undermines these principles. It says that labelling rules are best dealt with on an EU wide basis as is currently happening with ingredient and nutritional labelling. In seeking to do a solo run on labels, Ireland is weakening its position as a champion of EU trade and regulatory convergence, according to ABFI.

On advertising, ABFI says that the Alcohol Bill means that advertisements for craft breweries and distilleries will be severely constrained if they contain the name of the drinks brand associated with them. Advertisements will not be able to contain images of people or a suggestion of a storyline. Outdoor advertising will be severely limited, and advertisements will be prohibited from train stations, bus stops, Luas stops or even in the town where a craft brewery or distillery is located.

Patricia Callan, Director of Alcohol Beverage Federation of Ireland (ABFI) said:

“There are now over 100 micro-breweries and 18 distilleries in operation in Ireland. We welcome the Government’s recognition of the growing contribution of craft breweries and distilleries to the Irish economy. The Breweries and Distilleries Bill is a progressive and important piece of legislation. We’d like to acknowledge and thank Alan Kelly TD for introducing the Bill and Minister Charlie Flanagan for supporting and bringing forward this legislation.

“However, while on the one hand the Government is supporting small drinks businesses, on the other hand it is also about to introduce an extremely harmful piece of legislation in the form of the Alcohol Bill.

“The evidence shows that the labelling proposals will make it difficult to introduce new products to the Irish market and will put Ireland at a regulatory divergence from everywhere else in the EU. Additionally, the Government’s efforts to severely restrict the promotion and advertising of the drinks industry could kill advertising of craft breweries and distilleries.

“While the drinks industry supports the objectives of the Alcohol Bill, to tackle harmful drinking and underage consumption, any measure introduced should be rooted in evidence and should not unfairly impact an important Irish industry. We believe there is scope for reasonable amendments to the legislation and are calling on the Government to balance the bill.”