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Scott Wright

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There’s still uncertainty over what the Alcohol Act’s social responsibility levy will mean for the trade, writes licensing solicitor Caroline Treanor, of Tods Murray LLP.


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HE Alcohol (Scotland) Act 2010 received Royal Assent in December last year, and is anticipated to come into force on October 1 this year. While the Act will bring wide-


ranging changes to liquor li- censing in Scotland, one of the more controversial is the social responsibility levy. The proposed framework of this levy may be found in draft regulations which can be found on the Scottish Government website.

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An initial consultation with the Scottish Government is cur- rently underway, with a view to the responses to that consulta- tion being made publicly avail- able. Further consultation will also be necessary before draft regu- lations are placed before Parlia- ment. So, what is this charge and

how is it proposed to work? In essence, the levy will be charged to licensed businesses to help local authorities meet the financial cost of issues aris- ing from the over-consump- tion of alcohol on Scotland’s streets.

It’s unclear what the sanctions will be if you don’t pay, and if there is a right of appeal.

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The general idea is that licence holders will pick up the tab for the additional costs associated with, for example, extra polic- ing needed to deal with alcohol fuelled disorder and the costs incurred by local authorities to deal with extra street cleaning. The first interesting point to note is that a local authority will have the power to impose this charge but need not. This could mean that the levy becomes law in some local au- thority areas in Scotland but not in others. And, as a local authority has the discretion to determine the amount, the cost

this regard would be helpful. So it seems the questions aris- ing from the social responsibil- ity proposal are numerous at this stage.

It is also reasonable to ask

where all this money will go. Can the industry be sure that the local authority will spe- cifically use the money for the specified purpose? Remember, it is the local au- thority that will have the power to impose the charge and not the licensing board (which is

Treanor: social responsibility levy comes at a time the trade can least afford it.

may differ in different areas. Many questions arise at this

stage. Who will pay and how much can they expect to be charged? Will a nightclub that closes at 3am pay the same charge as, for example, a small wine mer- chant that closes at 10pm? Is this fair? How much will the charge be?

Will the trade pass this on to the consumer?

Much discretion is also left to the local authority in respect of identifying the types of licensed premises that will pay. The potential pool is rather wide-ranging and includes both premises and occasional licence holders and holders of civic licences such as street traders, public entertainment and late hours catering.


ere the concept of a ‘dou- ble charge’ arises in princi-

ple, as a premises or occasional licence holder may also be sub- ject to another charge if they hold a civic licence. This may be affordable for

certain types of premises, for example large licensed super- markets that hold a late hours catering licence.

But for those local grocery stores that have a small scale off licence and operate beyond 11pm, the concept of a double charge (which the local author- ity has the power to impose) may be more than they can fi- nancially take. The concept of ‘good practice’

raised in the consultation is also curious.

The idea is that if a licence holder demonstrates good prac- tice (yes, the onus is with you on this one to demonstrate it), then the local authority must give you a discount. The amount of discount is then decided following consul- tation. However, this also raises ques- tions. What if a licence holder calls the police frequently whenever there is trouble? Does this con- stitute good practice? A reasonable concern is that the subjective nature of what constitutes good practice could lead to inequities in decision making from board to board and lead to patchwork decision making throughout the coun- try.

A statutory definition of gov- ernment guidance to assist in

The subjective nature of good practice could lead to patchwork decision making.

itself a separate statutory crea- ture). In this regard, the ring- fencing of funds raised will be crucial. It is also unclear so far what the sanctions will be if you don’t pay, or whether you will have a right of appeal. My view is that, should local authorities decide to exercise this power, it will impose a con- siderable administrative burden on them. I am not suggesting that they should not impose the levy – they have the legal power to do so.

I am merely stating that, with the dust settling following the implementation of the Licens- ing (Scotland) Act 2005 and the amendments that will be brought to this piece of legisla- tion via the Alcohol Scotland Act 2010, (and not to forget the Criminal Justice and Licens- ing Act 2010) – it could all be regarded as too much too soon, even for local authorities. And let us not forget the

trade. However laudable the inten- tion may be, the concern must be that this levy will constitute an unbearable financial burden on it at a time when it can least afford it.

February 17, 2011 - SLTN - 11

Levy plan raises many questions

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