Clarity for supermarkets or not?

Clarity for supermarkets or not?

Clarity for supermarkets or not?

Thursday 13 July, 2017

The Alcohol Regulatory and Licensing Authority has recently provided clarity on a supermarkets ability to display and promote alcohol within single alcohol areas.  ARLA’s  decision has been appealed to the High Court.

The Sale and Supply of Alcohol Act 2012 (“the Act”) has placed restrictions on supermarkets and grocery stores in terms of where alcohol can be displayed and promoted within the premises.  When issuing or renewing a licence, section 112(2) requires that District Licensing Committees (“DLC”) and the Alcohol Regulatory and Licensing Authority (“ARLA”) impose a condition describing a “one area” within the premises to be the area in which the display and promotion of alcohol is permissible.  When describing the area, there are certain constraints under which a DLC or ARLA is required to operate (section 113(5)).  The area must not include the most direct pedestrian routes between the entrance of the premises and the main body of the premises.  Further, the area must not include the most direct pedestrian route between the main body of the premises and a point of sale or check-out.  The purpose of this, as described in section 112(1), is to reduce the exposure of shoppers to displays and promotions of alcohol and advertisements of alcohol.  Those are to be contained only within the single alcohol area (“SAA”).

The provisions of the Act relating to SAAs have been the subject of a number of court decisions, including the well-known Court of Appeal decision of J & C Vaudrey Ltd v Canterbury Medical Officer of Health [2016] NZCA 539.  Those decisions have generally provided some clarity for applicants and decision-makers on the application of the relevant sections.  However, there are still a number of uncertainties with respect to the internal area of SAAs.

A recent ARLA decision has provided further clarity and will be useful for DLCs considering a SAA (A M MacMaster v G & B Hasler Limited [2017] NZARLA PH169).  The Hasler decision relates to the renewal of an off-licence in respect of premises in Dannevirke.  The Medical Officer of Health (“MoH”) appealed the DLC decision to ARLA on the basis that end of aisle displays and the angling of shelves within the SAA increase the exposure of customers to alcohol products, and large illuminated signs could be seen outside the SAA.

In its decision ARLA stated that the Act requires that the SAA be identifiable relative to the wider premises where alcohol cannot be displayed or promoted.  In ARLA’s view, it is the relative position of the SAA that limits exposure of shoppers to the display, promotion and advertisement of alcohol and a licensee is free to arrange shelving and display units within the perimeter of the SAA in any manner it sees fit.  That being the case, ARLA held that the Act does not prohibit end-of-aisle displays or the angling of shelves within a SAA.  In terms of the signage ARLA held that there is nothing in the Act which prohibits the display, promotion or advertisement of alcohol at a place within the SAA nor does the Act imply a “visual state of affairs” as well as a physical location element.

The Hasler decision has been appealed to the High Court by the MoH.  Until the time that the Hasler decision is overturned by the High Court, it is the best authority available to DLCs who are considering conditioning the internal arrangement of SAAs.  We will report on the outcome of the appeal once it is available.