### Section 1: Implementing Minimum Pricing

**Responsibility for ensuring compliance with the mandatory condition of a premises or occasional licence**

1. Premises licence holders, premises managers and staff working on licensed premises have a responsibility to ensure the conditions of the premises licence, including minimum pricing, are being complied with at all times.

2. Failure to comply with a licence condition is a serious matter and can lead to a premises licence review; and ultimately to revocation ^{ [7] }. Minimum pricing is potentially relevant to all five of the licensing objectives ^{ [8] }.

3. In most cases it is hoped that these cases can be resolved in discussion between the LSO and the licensee without any further action being taken by the Licensing Board. Repeated breaches would be relevant in the LSO's consideration of what further steps to take. However, where the Licensing Board feels that further action is appropriate, it could instigate a review hearing to determine what action, if any, needed to be taken against the licensee concerned.

**How to calculate the minimum price of a product**

4. Minimum pricing will apply to the price of all alcoholic drinks. Each alcoholic drink will have a minimum price based on the amount of pure alcohol that it contains. All licensed premises will have to ensure that alcoholic drinks are not sold below their minimum price. The minimum price for an alcoholic drink is calculated as follows:

- price per unit of alcohol (£0.50) x strength of alcohol ( ABV) x volume in litres
^{ [9] }

5. The ABV to be used to calculate the minimum price is the ABV shown on labels on bottles and containers of alcohol. Most pre-packaged drinks are required to state on the label the drink's alcoholic strength by volume as set out in the Food Information (Scotland) Regulations 2014 ^{ [10] }. The guidance ^{ [11] } to these Regulations states that the actual alcoholic strength by volume of beverages containing more than 1.2% by volume of alcohol must be shown on the label (by a figure to not more than one decimal place followed by '% vol'). This is referred to as the "declared ABV". It is this ABV which should be used in calculating the minimum price of the product.

6. Where different alcohol drinks are mixed, for example in a cocktail, the declared ABV must be used for any alcohol to which relevant labelling provisions apply and the ABV for any other alcohol. The minimum price for each alcoholic component of the drink will need to be calculated and then added together to provide a minimum price for the whole drink. Any non-alcoholic drink added to the alcoholic products does not require to be included in the calculation as a minimum price does not apply to non-alcoholic drinks.

7. The majority of alcoholic products show the number of units in the container on the label. This number is **not** to be used in the calculation of the minimum price as it may have been rounded. In order to ensure the calculation of the minimum price is accurate, the formula on page 4 should be used.

Worked examples using a minimum unit price of 50 pence:

A 700ml bottle of spirits with an ABV of 37.5% would have a minimum price of:

- £0.50 x 37.5 x 0.7 =
**£13.13**

A 500ml super strength can of beer at 9% ABV would have a minimum price of:

- £0.50 x 9 x 0.5 =
**£2.25**

A 750ml bottle of wine with an ABV of 12.5% would have a minimum price of:

- £0.50 x 12.5 x 0.75 =
**£4.69**

A 2 litre bottle of strong cider at 6% ABV would have a minimum price of:

- £0.50 x 6 x 2 =
**£6.00**

A 25ml measure of spirits at 37.5% ABV would have a minimum price of:

- £0.50 x 37.5 x 0.025 =
**£0.47**

A 275ml pre-mixed spirit and mixer at 5% ABV would have a minimum price of:

- £0.50 x 5 x 0.275 =
**£0.69**(note that the addition of a mixer does not affect the minimum price)

A strong pint (568ml) of lager at 5% ABV would have a minimum price of:

- £0.50 x 5 x 0.568 =
**£1.42**

8. Where the minimum price is not a whole number of pence, the price should **always be rounded up** to the nearest whole number. So, in the first worked example the minimum price of a 700ml bottle of spirits with an ABV of 37.5% is £13.13. The calculation (£0.50 x 37.5 x 0.7) actually produces a figure of £13.125. In order to comply with minimum pricing, the price must be rounded up to £13.13. Prices of £13.121, £13.122, £13.123, etc, would similarly all **be rounded up to £13.13**.

9. It is essential that the price indicated to customers is clear and unambiguous and does not mislead consumers. Trading Standards advise that any price which no longer applies, including those on flash packs, is completely removed or covered. The retailer will also need to ensure that all prices are changed e.g. shelf price, till price, so the consumer is not misled as regards the price of a product.

**Online internet sales and telephone sales**

10. Minimum pricing will apply to all sales of alcohol that take place within Scotland i.e. where the alcohol is despatched from within Scotland. Businesses will need to ensure that the online and telephone price of all alcoholic products are not sold below the minimum price, if despatched within Scotland.

11. If alcohol is purchased online or by telephone in Scotland and despatched from outwith Scotland (whether that be the rest of the UK or internationally), then minimum pricing will not apply.

12. In relation to 'click and collect' facilities, these facilities are acting as a post box / collection point rather than a despatch point. The point of despatch would be where the goods have been despatched from to the 'click and collect' facilities.

**Staff discount**

13. Businesses can still offer staff discount, as long as the price after all discounts are applied is not below the minimum price. This applies to vouchers provided to staff as part of their benefits / remuneration package.