Thread: Sober decision on advert ban

ALCOHOL ACT AMENDMENTS
Hospitality reps meet with panel


Damage to tourism and existing investments cited as concerns


Booze-purveyors and related businesses, including hotels and restaurants, yesterday raised their concerns and made suggestions at their first meeting with the National Legislative Assembly committee vetting the alcohol-control bill.

Chanin Donavanik, president of the Thai Hotels Association (THA), said the alcohol-control law, which prohibits the sale of alcohol products within 200 metres of schools, would clobber the tourism industry, especially hotels, restaurants and bars.

"We want a clear framework for this law. It should not give too much power to the committee or the minister," he said.

Almost 4,000 hotels have huge investments at stake, so they do not want to see uncertainty in regulations or one group given unbridled power to control the industry, he said.

Sampan Panpat, honorary adviser to the association, said the liquor ban around schools had soured the mood in the tourism industry. "Foreign tourists don't understand why such a ban was imposed, and this will hurt the industry," he said.

However, he said he was relieved to learn from the alcohol-bill committee that it would not draft any laws that would have an impact on the tourism industry and related businesses.

Tourism and service industries are important and generate major earnings for the country. Last year, 13.82 million tourists visited Thailand, an increase of 20 per cent on 2005, while 79.33 million Thais took local tours. Tourism revenues increased 23.1 per cent to Bt8.6 billion.

This year the Tourism Authority of Thailand has targeted 14.8 million tourist arrivals, 81.99 million local outings and Bt9.25 billion in tourism revenues.

Pavornwan Koonmongkol, president of the Thai Restaurant Association, said the ban on liquor advertising would extend to advertising materials in restaurants such as the bottle coasters bearing logos of the maker. Liquor companies have long provided such materials to restaurants free of charge to promote their products.

The materials could no longer be used, which means the restaurants would have to dish out their own money to buy coasters and other materials. The total damage to them is estimated at Bt5 billion.

Pavornwan urged the government to allow people in the business to take part in the bill's development.

Vorathep Rangchaikul, president of Diageo Moet Hennessy (Thailand), the importer and distributor of alcoholic drinks such as Johnnie Walker Scotch whisky, welcomed the rare opportunity to touch bases directly with law- and policy-makers.

"We are quite impressed by having the chance to meet and share our concerns and experiences with the authorities for the first time. As business operators, we want to provide them with practices after doing almost 30 years in the alcohol business in Thailand. We also have information from almost 180 countries around the world relating to alcohol control and regulation," said.

Vorathep said that from his company's perspective the alcohol legal framework needed to cover three major goals: stopping drinking by youths, protecting against accidents and dangers from irresponsible drinking and encouraging cooperation among all players involved in production, distribution and services.

He said the proposed alcohol control law focused on controlling the marketing and advertising of alcoholic beverages without concern for existing problems in the industry, particularly the domination of local white liquors and blended spirits. These local brews have almost 70 per cent of the overall alcohol market. They enjoy dramatic growth every year without needing any advertising, just cheaper prices.

"The new proposed alcohol-control regulation, which focuses on a total ban of alcohol advertising, will encourage a price war in the market. Many quality products will be replaced with cheap ones. All related industries, such as hotels and restaurants, will suffer from the decline in travellers to the country," he said.

All the sports and music businesses here would be traumatised, as they would lose the support and sponsorship of alcohol companies, he said. Most international games and concerts would disappear from Thailand. All small and medium-sized makers of signs and advertising materials would be hit severely by the new act.

"What we have suggested to the NLA committee today is to utilise the existing regulations on alcohol advertising. A joint committee, with members from the public sector, business and advertising, will be formed to directly review and screen all advertisements submitted by alcohol firms," he said.

The existing ordinance forbidding alcohol sales at all retail outlets during the daytime from 2pm to 5pm and at night from 1am to 5am was impractical and limited the individual right of travellers and shift workers to purchase alcohol products, he said.

"We would like to suggest the authorities lift the afternoon ban all around the country since it will not reduce alcohol consumption by students, as intended by the government. The ban during the period has also limited the right of foreign tourists to buy liquor at hotels.

For such tourist destinations such as Phuket and Samui, the ban on the night-time period should be more relaxed by changing it to between 2am and 5am from the existing 1am to 5am," said Vorathep.

He added that the authorities should not prevent alcohol firms from conducting promotional activities such as temporary price reductions and giving premiums and said the strict controls proposed would force them into permanent price-promotion activities.

The Advertising Association of Thailand is rebuffing claims that the industry now supports the proposed Alcohol Beverage Control Bill. The claims were made in a statement from a spokesman for the NLA committee which is currently reviewing the draft legislation.

Association president Witawat Jayapani stressed on Tuesday that the bill would be effective only when a specific tax, levied on a litre-of-pure-alcohol basis, was applied. At present the tax measure is ambiguous, and the proposed advertising restrictions could actually increase the number of alcohol-drinkers.

The advertising industry in Thailand is still opposed to the draft bill as it denies producers and distributors an opportunity to build brand awareness and reputation. Due to the brand awareness, alcohol companies can set higher prices on specific products, and this limits consumers to higher income groups, thus excluding younger groups, he said.

Witawat believes that restrictions on alcohol advertising in Thailand without applying tax-control measures would open the door to cheap, less reputable foreign brands seeking to gain a market share through lower pricing, such as beer made in China.
"This would undermine our common goal of protecting young people through education and programmes that emphasise the importance of social responsibility in our society," he said.


Kwanchai Rungfapaisarn
The Nation