Turkish alcohol ad ban will encourage illicit booze

18th June, 2013 by Becky Paskin

Turkey’s ban on alcohol advertising will prevent new brands from entering the market, while allowing the illicit market to flourish, a European spirits organisation has said.

Diageo Mey Icki Yeni-Raki

Diageo, which bought Yeni Raki producer Mey Icki in 2011, called the Turkish alcohol ad ban “disappointing”

The country adopted strict legislation on 24 May forbidding the advertising and promotion of alcohol on TV – including scenes that depict drinking, and the sale of alcohol between 10pm and 6am.

However Spirits Europe claims the new laws, which are designed to stem the amount of alcohol drunk in the country, will in fact encourage the counterfeit spirits market to grow.

“The ban will make it impossible for new comers to enter the market (be they Turkish or foreign brands),” the group said in a statement. “By making legitimate brands less accessible, the new proposal will also provide additional incentives for the illicit market to flourish.

“The WTO estimates that as much as 50% of the alcohol consumption in Turkey is already from informal channels. Because illicit products are beyond the reach of tax and public health officials, they represent foregone tax revenues to the government and carry an intrinsic public health risk.”

According to a study of Turkish consumers by TNS, 82.4% of the population aged over 18 claim not to drink alcohol.

“So if ever advertising would influence the level of consumption – and we believe it does not – there is little to win and even less on harm reduction, yet the decision will have a serious economic effect,” Spirits Europe added.

Diageo, which bought the Turkish raki producer Mey Icki two years ago for £1.3bn, saw shares fall 5.3% when Turkey’s parliament passed the alcohol ad ban. It called the legislation “disappointing”, adding that a “collaborative approach among the industry, government, and third parties would lead to a better outcome.”

Spirits Europe is now urging the Turkish government to open a consultation with the industry on the law’s implementation.

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