What is the Minimum Unit Pricing Law?
New liquor “minimum unit pricing” in the Northern Territory came into effect on 1 October 2018.
The new law applies to all sales or supplies of liquor to a person in, or by delivery to, the Northern Territory.
All liquor retailers licensed outside the Northern Territory but which offer liquor for sale and delivery into the Northern Territory, should ensure they have reviewed their liquor sales offers and procedures, and have applied to the Northern Territory authority for an “interstate retailer licence”.
Northern Territory liquor licensing changes – Minimum Unit Pricing
New “minimum sale price” provisions in the Liquor Act (NT) (NT Liquor Act) came into effect on 1 October 2018.
The operation of these provisions extends to retailers in other States or Territories which offer liquor for sale to retail customers, and/or deliver liquor sold by retail sale to addresses, within the Northern Territory.
“Interstate” licensees offering liquor for sale and delivery into the Northern Territory must hold an “interstate retailer licence” issued by the Northern Territory licensing authority in order to comply with these requirements.
About the New Legislation
The Liquor Amendment (Minimum Pricing) Bill 2018 (NT) received assent on 27 August 2018. The Liquor Amendment (Minimum Pricing) Act 2018 (NT) introduces a range of new provisions in the NT Liquor Act.
The new law has:
- introduced offences of offering and selling liquor below a specified “minimum sale price” (otherwise more colloquially known as a “minimum unit price”);
- introduced various provisions for the calculation of the “sale price” in particular circumstances and for particular transactions; and
- introduced “extra-territoriality” provisions which extend the application of the NT Liquor Act to transactions involving a sale to persons in the Northern Territory, or delivered to the Northern Territory, regardless of where the legal “sale” may otherwise be considered to have taken place.
About the Alcohol Policies & Legislation Review
The “Alcohol Policies & Legislation Review” (also known as the “Riley Review”) concluded in October 2017. In February 2018, the Northern Territory Government confirmed its support in full for 186 recommendations (and a further 33 in principle) made in the Review.
One of the key recommendations made to minimise alcohol-related harm included the introduction of a “floor price” for liquor.
This was framed as a step to “fix a market and regulatory failure”, in the context of a recognised public health problem in the Northern Territory, including that “the Territory is plagued by levels of harmful drinking beyond any other State or Territory.”
Measures otherwise already in place in the Northern Territory include the “Banned drinker register”, which requires purchasers of liquor to supply photographic identification to confirm they are not listed on that register (and accordingly banned from purchasing takeaway liquor).
Minimum retail price
A minimum retail price of $1.30 per standard drink applies. Wholesale transactions (sales to holders of a liquor licence) are not subject to this constraint.
The Northern Territory Government’s stated position is that this minimum price will “catch” around 25 products in the Darwin area and 28 products in Alice Springs which are currently priced below this rate.
This “floor price” is to be reviewed every 3 years, is to be indexed in a manner to be prescribed by regulation.
The new law includes amongst other provisions, means for the calculation of the applicable price where (for example) there is a “mixed” purchase of liquor and non-liquor products.
Importantly for interstate retailers, the calculation of the sale price for a “delivery” transaction will include the delivery charges applied.
A “rate card” prepared by the licensing authority showing minimum price by volume and alcohol content can be found here. By way of example, the minimum price for a 750ml bottle of wine at say 14% abv is $10.77. For a carton of beer (24 x 375ml bottles, at say 4.5% abv) the minimum price is $41.54.
The new law extends the scope of the “sale, provision and promotion” of liquor which is regulated under the NT Liquor Act to include “retailers external to the Territory who sell, provide and promote liquor to purchasers who are in the Territory, or for delivery to a location within the Territory”. Those retailers must now hold a liquor licence issued pursuant to the NT Liquor Act to undertake that activity.
The NT Liquor Act provides that interstate retailers who hold a licence in another State or Territory but do not already have a licence in the Northern Territory may apply for and be granted an “interstate retailer licence”.
Obtaining an “interstate retailer licence”
The process for interstate retailers to obtain an “interstate retailer licence” is straightforward.
The application can be made on-line, by providing a copy of the liquor licence(s) already held by the retailer – see the Northern Territory authority’s information here, and the application form here.
Obligations on holders of an interstate retailer licence
A retailer who has obtained an interstate retailer licence in order to allow it to offer liquor for sale and delivery in and into the Northern Territory must comply with the provisions of its existing licence(s) (i.e., any licence(s) it already holds in any other State or Territory) in addition to the requirements under the NT Liquor Act as to offers for sale and supply of liquor in the Northern Territory.
The NT Liquor Act also requires that licensees collect and maintain data as to liquor sales as is prescribed by regulation. The Northern Territory Government has not yet promulgated regulations in this regard.
Actions for retailers selling into the Northern Territory
Liquor retailers based outside the Northern Territory who offer products for retail sale and delivery in and into the Northern Territory (whether by “on-line” offers, mail or telephone order, etc.) ought to, if they have not already done so, promptly undertake the following steps:
- make an application for an “interstate retailer licence” if they intend to continue to offer liquor for sale and delivery in and into the Northern Territory;
- review and update their policies and staff training to ensure that any promotions, offers or sales which their business makes to customers and potential customers in the Northern Territory comply with the “minimum sale price” requirements;
- review and update “customer facing” sales offers (and terms and conditions), including to make clear that offers and sales of liquor are made subject to compliance with the Northern Territory’s “minimum sale price” laws; and
- carefully consider the terms and management of “bundled” promotions, “loyalty scheme” offers and discount and refund policies for compliance – there are potential complexities here given the manner in which refunds, discounts and “non cash” payments are considered and calculated for minimum price purposes.
This Alert is intended as an alert only. It does not purport to be comprehensive advice. Readers should seek professional advice before acting in relation to these matters.