alcohol

Nigeria’s Alcohol ban is an attack on consumers’ freedom, small business owners

Nigeria’s ban on alcohol recently made the rounds in the news on local media outlets. The announcement disclosed in a statement by the National Agency for Foods and Drugs Administration and Control (NAFDAC) director-general, Prof. Christianah Mojisola Adeyeye, stated that the Federal government had issued directives targeted at phasing out the sale and consumption of alcohol in sachets and polyethylene terephthalate (PET) bottles. This means that the regulatory agency will no longer register new products in sachet and small volume PET or glass bottles above 30 per cent Alcohol by Volume (ABV) and also mandated alcohol companies to drive down production by at least 50% enforceable for January 31, 2020. This article highlights the effect of the ban on small business owners and the limitation to the freedom of consumer choice. 

This partial ban on alcohol seems to only be targeted at a specific set of people – Low income earners. The dominant consumers of alcohol in sachets and small bottles are low income earners, just as the predominant retailers of alcohol in this packaging are small businesses who own small kiosks or even hawk their wares. In fact, the reason big companies often go the route of selling alcohol in sachets and small packs is because that is the only way low income earners can afford them. Shutting out this access is in fact seeking to erase the end of one market. This prohibitionist approach effectively cuts off many low-income earners from participating in the alcohol market. This is likely to cause economically disadvantaged people to buy alcohol in excess of what their finances ordinarily allow as affordable options are being taken out of the market. It essentially signals to low income earners to buy more alcohol since the only option they are left with is to buy alcohol in bigger packaging. Also, by making the sale of alcohol in sachets illegal, there is also the possibility of certain individuals taking advantage of the demand for sachet alcohol by illegally apportioning alcohol in sachets and other smaller containers under potentially unhygienic conditions.

Beyond the suffocation of economic activities at the base of the pyramid, an outright ban conflicts with the freedom of consumers to choose and the importance of markets, this is another example of the Nigerian government’s overarching involvement in the choices of Nigerians. The agency had highlighted that uncontrolled access and availability of high concentration alcohol contribute to substance and alcohol abuse in Nigeria transitioning into a negative impact in the society. One of the best approaches to curbing substance use has been used in the tobacco industry. Without banning its usage, members of the public are made aware of the consequences of tobacco use and allowed to make their own decisions. 


The Nigerian government has become increasingly overreaching in its responsibilities by taking away decisions that should ideally be left to consumers. Usually, when a group of people make decisions for others, they do this with their own bias and without much knowledge of the motives of the eventual consumers. The truth is that consumers are usually aware of the risks and benefits associated with products they use before consumption. However, the most ideal approach should be to make any new information about certain products publicly available so that consumers can have more information that can help them make informed decisions. Due to the absence of a perfect product, consumers often always juxtapose the risks and benefits associated with each product they consume with alternatives available. While certain persons will embrace certain risks, others are less likely to do so or may simply choose preferable risks. Banning products reduces the alternatives for users, limiting the available solutions to their problems as everyone who makes a purchase of an item is looking to solve an important problem.

Banning the sale of alcohol as well as instructing companies to deliberately lower their production below their capacities and operate at 50 percent efficiency irrespective of market demand is detrimental to an economy. It is also a direct affront on the freedoms that consumers should have in an open market. 

Supreme Court Makes the Right Decision on Modernizing Alcohol Laws

CONTACT:
Yaël Ossowski
Deputy Director
@YaelOss
yael@consumerchoicecenter.org

Washington, D.C. – In a 7-2 decision handed down yesterday, the U.S. Supreme Court struck down a Tennesse law that prohibits new state residents from obtaining liquor licenses.

The law required a two-year residency in the state before applicants could apply for a liquor license for a new business, shutting the door to entrepreneurs and depriving consumers of products they otherwise would have enjoyed.

The main issue up for consideration in Tennessee Wine And Spirits Retailers Assn. v. Thomas was whether the 21st Amendment, which repealed alcohol prohibition in 1933, allowed states carte blanche to pass alcohol laws that effectively violated the commerce clause.

In response, Yaël Ossowski, Deputy Director at the Consumer Choice Center, said “the Supreme Court made the absolute right decision, and it gives a total endorsement for the modernization of our Prohibition-era state alcohol laws.

“In many southern states and beyond, alcohol-control laws are some of the most byzantine and backward on the books. Indeed, many have not changed in the 86 years since the end of Prohibition.

“These laws treat adults like children, stunt economic growth, deprive consumers of better choices, and drastically increase costs for everyday people who just want a drink at the end of a hard day’s work.

“The Supreme Court’s decision isn’t as expansive as consumers would like, but it at least begins the conversation about how we can liberalize and modernize our alcohol laws for the 21st Century.

“Now is the time to explore getting rid of state liquor monopolies, protectionist limits on distribution, crony alcohol commissions, the requirements to use wholesalers, bans on shipping across state lines, punitive taxes, and other restrictive regulations that limit the creativity of entrepreneurs to deliver better products that consumers love.

“With more modern alcohol policies, entrepreneurs will have more room to grow their businesses, consumers will have access to better products tailored for their tastes, and we will finally close the book on the destructive era that was alcohol Prohibition in this country,” concluded Ossowski.

CCC’s Deputy Director Yaël Ossowski is available to speak with accredited media on consumer regulations and consumer choice issues. Please send media inquiries HERE.

The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org.

Last Call should be extended for all consumers, not just politicians

CONTACT:
Yaël Ossowski
Deputy Director
@YaelOss
yael@consumerchoicecenter.org

Last Call should be extended for all consumers, not just politicians

Charlotte, NC – Yesterday it was reported that North Carolina Republicans have introduced a provision that would allow bars, clubs, and restaurants to stay open until 4 AM during the 2020 Republican National Convention.

Consumer Choice Center Deputy Director Yaël Ossowski responded to the news stating that extending the hours that facilities can serve alcohol shouldn’t just be a temporary measure for big city political conventions, but should instead be allowed statewide from here on out.

“What message are we sending about consumer choice if we only pass modern alcohol policies when a party comes to town,” asked Ossowski.

“Giving business owners the permanent option of staying open later to serve customers would provide the exact same economic benefits state legislators are touting about temporarily giving business owners that option in August 2020 during the RNC.

“Extending the time for ‘Last Call’ would be up to the individual businesses, and would be a huge boon for modernization of our state’s alcohol policy. Not only would clubs, bars, and restaurants have more flexibility, but consumers would also have a bigger range of options to choose from, and that could finally provide an incentive to lawmakers to update our state’s antiquated alcohol laws.

“Bringing North Carolina into the 21st Century when it comes to alcohol policy should be a priority for state legislators, and that is something that should be embraced for all North Carolina residents, not just when the RNC comes to Charlotte,” said Ossowski.

The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org.

Two big victories for consumer choice and modernized alcohol policy

The warm months are delivering some great news when it comes to increased consumer choice and modernized alcohol policy across North America.

ONTARIO

The first success story comes from the Canadian province of Ontario, where Premier Doug Ford has announced the end of the province’s exclusive contract with The Beer Store, the beer monopoly.

When announcing the policy, Ontario Finance Minister Victor Fedeli quoted the words of Consumer Choice Center North American Affairs Manager David Clement, who has contributed to the debate to open up beer sales across the province.

This positive move comes on the same day the government announced it would be expanding alcohol sales in LCBO stores across the province, after which Clement says “consumers across the province would appreciate more access to alcoholic drinks over the summer months.

The Consumer Choice Center played a pivotal role is shaping the policy debate in favor of modernized alcohol policy and consumer choice, and will continue to do so across the country.

“Today’s alcohol announcement is a step in the right direction,” said David Clement. “The move helps underserved regions, while maxing out the amount of grocery stores allowed under the Master Framework Agreement (MFA). It is positive to see these changes while the province undergoes the process of scrapping the MFA and allowing for alcohol sales in convenience stores.”

“We are hopeful that the announcement could increase access over the summer months, which would definitely be appreciated by consumers province-wide.” said Clement.

NORTH CAROLINA

Following the positive vibes from the Great White North, the state of North Carolina also had a major alcohol policy modernization pass.

Last Thursday Gov. Roy Cooper signed House Bill 363, the Craft Beer Distribution and Modernization Act. The law will allow craft brewers to self-distribute more than twice was allowed previously without a wholesaler.

That measure will allow breweries to expand and ship more product across the state, giving North Carolina consumers greater access to their favorite craft brews.

I have written about this topic for the Charlotte Observer (here and here) and been interviewed about it on the radio on the Joe Catenacci Show and the Chad Adams Show.

Much like above, there is still a lot that needs to be done to have a true modern alcohol policy in the Tar Heel State. Ending the state’s monopoly of ABC stores (that sell liquor) would be prime, and the next would be allowing distilleries to offer and sell their products on site and for delivery.

Regardless, these are two big victories for consumer choice and modernized alcohol policy, giving consumers more of a say, more choice, and better options!

Don’t blame Doug Ford for the costs of breaking unfair beer retailing contracts

Opinion: We should blame politicians who set up and maintained a system that has both inconvenienced and overcharged consumers for nearly a century.

A lot has changed in the last 92 years, but Ontario’s alcohol policy is one thing that has remained largely the same. Following the repeal of alcohol prohibition in 1927, the province granted Brewers Warehousing Co. (later Brewers Retail/The Beer Store) a monopoly over beer sales, to appease prohibitionists. Now Prohibition’s legacy lives on through The Beer Store’s near monopoly on beer sales today, and Ontario Premier Doug Ford is facing both political heat and legal threats by trying to challenge it.

If the Ford government follows its plan, beer and wine will be available in corner and big box stores by Christmas. Evidence suggests this policy will enhance consumer choice by expanding variety, increasing convenience, and lowering prices. Anindya Sen, an economist at the University of Waterloo, estimated that roughly $700 million in annual revenue earned by The Beer Store is incremental profit earned because of its monopoly status and ability to charge higher prices. Additionally, The Beer Store’s roots in Prohibition demonstrate that lack of access is a feature, not a bug, of the current retail system. This inconvenience may be why 54 per cent of Ontarians support allowing more privately owned stores to sell alcohol.

Modernizing alcohol sales is good public policy. While the LCBO’s earnings serve as a cash cow for the province, The Beer Store’s profits primarily go into the hands of large multinational brewers — Anheuser Busch-InBev, through its Labatt subsidiary; Colorado-based Molson-Coors; and Japan’s Sapporo, through its Sleeman subsidiary. Additionally, retail monopolies do little to promote social responsibility. As one of the authors’ research has shown, privatization of alcohol sales in Alberta was associated with a lower rate of impaired driving.

The precedent for this change exists, as convenience stores already sell lottery tickets and cigarettes, and face hefty penalties for selling to minors. Furthermore, alcohol liberalization isn’t only good for consumers, it’s good for the economy. By studying similar reforms in British Columbia, a new report from the Retail Council of Canada predicts that Ford’s proposed reforms would result in 9,100 new jobs and a $3.5-billion dollar increase in GDP.

We should not blame the Ford government for pursuing alcohol modernization

However, pursuing this change has had its own set of challenges. The Beer Store has threatened legal action against the province if it moves forward with its plan, citing its agreement with the previous Liberal government that limits the number and type of beer-retailing outlets in Ontario until 2025. Beer-industry insiders claim a breach of contract could cost Ontario up to $1 billion. While there are reasons to doubt this figure, including that estimates have rapidly grown from a previous estimate of $100 million in the short time since the story about the Ontario government’s plans broke, it has proven to be politically challenging for the Ford government. Critics have claimed that moving forward would be irresponsible due to the financial risk, with Ford being directly responsible for the potential losses.

There are two important lessons to take from these exorbitant claims. The first is that the figures that opponents of the plan are claiming are entirely unsubstantiated. They are simply the figures they claim. In order for them to have any legal weight whatsoever, they would have to be proven in court, which would require The Beer Store to open its books. Given the grandiose figures being tossed around, it is entirely possible that The Beer Store is bluffing in an attempt to maintain its privileged treatment. The second important lesson here is the price of cronyism overall. The government over-regulating and picking winners and losers in the market hurts consumers twice over. First through inflated prices and poor customer service, and again as taxpayers via legal challenges. Setting a precedent that the Ford government stands with consumers over special interests would clearly show that it stands for the people.

When it comes to placing blame, there is a lot to go around. We should blame the politicians who set up and maintained a retail system that has both inconvenienced and overcharged Ontario consumers for nearly a century. We should blame the previous government for attempting to tie the hands of subsequent leaders by signing the latest contract with The Beer Store. However, regardless of the outcome of the legal challenge, we should not blame the Ford government for pursuing alcohol modernization. While this move may be costly, it is necessary to right past wrongs and end Ontario’s Prohibition-era alcohol framework. Ford has lots to answer for, but not this.

Heather Bone is a research fellow at the Consumer Choice Center and an economics PhD student at the University of Toronto. David Clement is the North American affairs manager of the Consumer Choice Center.

Read more here

N.C. alcohol rules should join the 21st century

CHARLOTTE OBSERVER: Due to strict N.C. alcohol laws, online merchants such as Amazon can’t stock your favorite wines, craft beers or liquors unless they follow a very strict line of regulations. READ MORE: http://www.charlotteobserver.com/opinion/op-ed/article208148184.html#storylink=cpy

Irish tax on alcohol is enough to drive everyone to drink

TIMES OF LONDON: Consumer Choice Center’s Bill Wirtz is published in the London Times: “We need to recognise that consumers have the right to make choices. This implies that they make the choice to drink because they are allowed to enjoy themselves. Or at least while they are still allowed.”

UK’s increased duties on low-cost alcohol will only serve to punish the poor

CONTACT: Ryan Khurana Research Fellow Consumer Choice Center ryan@consumerchoicecenter.org UK’s increased duties on low-cost alcohol will only serve to punish the poor London, UK – On Wednesday, U.K. chancellor Philip Hammond announced the latest budget in the House of Commons. Ryan Khurana, Research Fellow at the Consumer Choice Center (CCC), said the increased alcohol duties in […]

Ending the Burden of the Regulatory State

Free to Brew: Joining the show is Yaël Ossowski, Public Relations Director for the Consumer Choice Center, and North Carolina Native.

Let’s get real about N.C.’s alcohol laws (including the drinking age)

North Carolina can no longer afford its Temperance-era alcohol laws. Across the state, a new generation of beer entrepreneurs are giving the Tar Heel State some much needed pride.

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