The regulations approved by the Latvian government to reduce availability of alcoholic beverages will not reduce overall alcohol consumption among residents, nor will it significantly affect the financial results of companies in this sector, according to interviewed traders.
AlkOutlet representative Gints Lazdiņš said discussions about possible changes for alcohol distribution-related legislation continue nearly all the time, and organising regulations is important. However, it is necessary to find reasonable balance between the responsibilities of producers, traders and consumers. Unfortunately, at the moment
planned changes are aimed exclusively on limiting operations of legal stores.
He said the government’s approved regulations leave out important sections that affect public health, such as efforts to educate consumers, especially youngsters, as well as prevention of illegal trade of alcohol.
Lazdiņš mentioned that adoption of changes will require new initiatives. Nevertheless, brand stores are ready for changes. On top of that, there is no reason to believe amendments will have any negative impact on financial results or development plans of various alcohol-selling companies.
When asked about the prohibition to sell alcoholic beverages the strength of which exceeds 22% and which are sold in 0.2 l PET bottles, Lazdiņš said there are beverages of this kind on the market. However, their proportion among the products sold by AlkOutlet is very small. This means this restriction will not cause any significant losses for traders.
«I allow for the possibility of this regulation to be proposed in an effort to reduce availability of strong alcoholic beverages for people with limited finances and regular alcohol consumption habits, but I don’t think such changes will achieve their goal and significantly affect chronic alcohol drinkers’ habits,» said Lazdiņš.
He also said it would be more important to commence a discussion about the possibility of selling all kinds of strong alcoholic beverages in specialised stores only. It would also be a good idea to limit sales of strong alcohol-containing cosmetics, considering many residents still use them «internally» instead of externally.
«Let’s be honest – a bit portion of alcohol-related problems stem from the grey zone, not legally working stores. The same cane be said about various «underground stalls» that sell spirit, vodka and cigarettes from behind the counter, as well as shady shops that sell «aftershave lotions» containing 40% alcohol and other similar products,» explains Lazdiņš.
Spirits&Wine brand representatives said they are generally positive about amendments to the Handling of Alcoholic Beverages Law and Electronic Mass Media Law.
«In regards to advertisements of alcohol, we believe amendments are a good thing. This means the end to the so-called price wars. On top of that, we will need to use other means to communicate offers to our buyers,» said Spirits&Wine board chairman Andris Lūkins. This company, too, does not expect law amendments to have a negative impact on their financial results.
Elvi Latvija LLC Commercial Director Laila Vārtukapteine said new requirements will not affect Elvi by much, because alcoholic beverages make up only a small portion of the store’s assortment of goods for sale.
«Of course, some residents suffer from alcohol addiction. However, new restrictions do not offer much hope that this problem will be resolved,» she said. Vārtukapteine also added – to put an end to excessive consumption of alcohol, it would be better to raise people’s welfare and work preventively with social groups at risk of alcoholism the most.
She also said experience shows that
people who want to drink alcohol excessively, will do it regardless of trade initiatives and prohibitions.
When asked about adoption of new requirements, Elvi representative said the planned changes do not require new investments to make them happen – it is more about influencing everyday planning in stores. It will be necessary to adapt the promotional materials creation policy and marketing solutions in accordance with new requirements. Fortunately, these tasks will not require any additional funding. Maxima Latvija LLC Corporate Communications Projects lead Laura Bagātā admits the justifications behind the amendments and their implementation plan are unclear, nor do they provide any convincing explanations how specific proposals could help reduce consumption of alcoholic beverages.
Rimi Latvia LLC External Communications manager Inga Bite mentioned it would be a good idea to reconsider all conditions and review the planned law again together with industry representatives and public health professionals.
«When limiting something, it is important to look at the effect such an act could have on excise and value added tax revenue. At the same time, it is necessary to keep in mind that these are investments into residents’ welfare. At the moment, according to the existing redaction of the law, Rimi does not see any major risks for any additional investments,» said Bite.
On top of that, she said regulations on restriction of alcohol promotion online should be reviewed again, especially considering the Internet is an environment that is very difficult to control. The way monitoring of compliance with these new regulations is unclear. Additionally, if something is prohibited, it is important to clearly define the possible liability for non-compliance. A minimal penalty amount is not enough to convince dishonest traders to discontinue their shady practices.
Bite also mentioned that the biggest changes will affect loyalty card holders, because amendments will put an end to the option for residents to purchase alcoholic beverages in unlimited volumes. Group discounts will be affected as well, such as the 20% discount for all sparkling wines. No discount will be offered for alcohol when purchasing multiple packages.
As previously reported, on the 21st of March, the government in Latvia supported amendments developed by the Ministry of Health for labels of alcoholic beverages, price and discount offers, as well as distribution of alcohol in gambling halls and other locations.