Kalle Dramstad: EU Rules do not threaten the Áfengis- og tóbaksverslun ríkisins alcohol monopoly

The Icelandic discussion of new EU-rules as a threat to the ATVR alcohol retail monopoly is based on a misunderstanding and risks gravely undermining Icelandic public health outcomes, writes Kalle Dramstad, Brussels-based expert on EU alcohol policy.

Alcoholic Beverages To Be Sold Online” reads an Icelandic article that recently made a splash in the Brussels public health circles. It explains that the Icelandic government is considering a bill that would give up the ATVR alcohol monopoly by allowing private alcohol sales online. The measure is described as mandated by the EU Geoblocking Directive. To someone working full-time on EU alcohol policy, it appears the Icelandic debate is the result of a grave misunderstanding of new EU-rules.

Public health oriented alcohol retail monopolies are legal under EU-rules. This was confirmed by the European Court of Justice over 20 years ago and there are several alcohol retail monopolies that continue to exist within EU and EEA-countries: Sweden, Finland, Norway and Iceland are clear examples.

Not only are the monopolies legal but also recognised by the World Health Organisation, WHO, as one of the most effective measures for reducing alcohol-related harm. Recent research from Finland shows that there would be over 500 additional alcohol-related deaths in the country should alcohol sales be completely privatised. A systematic review of evidence carried out by the US Centre for Disease Control’s Preventive Services Task Force also showed how privatisation of alcohol retail sales is associated with a dramatic increase in alcohol consumption. They, therefore, strongly recommend against it.

The evidence is clear that when market forces are allowed into the alcohol retail market, not only do prices fall and consumption increase, but it also becomes significantly more difficult to make sure that licensing rules are followed. The Swedish alcohol monopoly Systembolaget has an age-check rate of over 95%. This number is unmatched by private retailers in countries where alcohol retail sale are privatised.

Proponents of the idea to privatise internet sales of alcohol in Iceland seem to claim this is required by the new EU Geoblocking Directive. Fortunately, it can easily be verified that so is not the case.

It suffices to look at all those EU-countries which implemented the Geoblocking Directive in 2018 and where alcohol monopolies are still standing strong. In 2018, Finland even had their ban on online sales of alcohol (including from other EU-countries) upheld by the Finnish High Court after a supportive judgement in the European Court of Justice.

If there are people who are uncertain as to how the Geoblocking Directive can be reconciled with an alcohol monopoly, my advice would be for them to contact the Ministry of Social Affairs in Finland or in Sweden and ask for help. There are also many NGOs in Brussels that would gladly offer our services and input should it be needed.

It is always worrying to hear about situations where EU-rules are being cited as a justification to remove effective public health policies. Usually it is based on a legal misunderstanding, but such misunderstandings can also be exploited by actors who would stand to make a lot of money from an increase in alcohol consumption. It is therefore important that the alcohol policy debate is being led by facts and evidence, both when it comes to legal matters and public health effects.

Kalle Dramstad

Head of European Policy, working on EU and alcohol policy in Brussels for the Swedish NGO, IOGT-NTO