Current Developments in European Alcohol Policy: An Analysis of Possible Impacts on the German Wine Industry

Abstract

In February 2022, the European Parliament agreed on a far-reaching package of measures to regulate alcohol consumption in its vote on “Strengthening Europe in the fight against cancer”. This article therefore elaborates on the most important positions and directions of current European alcohol policy and discusses possible effects on the German wine industry based on existing literature. It can be shown that the attitudes towards alcohol consumption sometimes differ considerably within the European Union, but that there is increasing harmonization of consumption-regulating measures in the course of European integration. However, alcohol policies in the EU are limited by an unclear scientific assessment of “moderate” consumption. This is supplemented by moderate social awareness and the scientific discourse on the effectiveness of alcohol policy measures, as well as a lack of government initiative and legal barriers. Ultimately, the German wine industry finds itself confronted with new scientific findings, associated political demands and creeping changes in social attitudes towards alcoholic beverages.

1. Introduction

In the global wine industry, Germany is considered one of the most important consumer markets. Above all, the country has an outstanding position as the world’s largest wine importer [1]. Domestically, approximately 100,000 hectares of vines are cultivated. In 2020, more than 16,000 winegrowing businesses and approximately 36,000 cooperative winegrowers existed in Germany [2,3]. Therefore, viticulture makes an important contribution to the development of rural areas.

In Germany, wine is a recognised stimulant and has the status of an intangible cultural heritage due to its long tradition [4]. Vines were already cultivated along the rivers Rhine and Moselle in Roman times [5].

It therefore seems alarming for the German wine industry that calls to reduce the consumption of alcoholic beverages of all kinds are emerging in Europe. A guiding decision was made on 16 February 2022, when the European Parliament voted on “Strengthening Europe in the fight against cancer” [6]. The resolution was based on the report of the Special Committee on Beating Cancer (BECA for short) which was established in June 2020 [7,8,9]. The text was adopted by a large majority in Parliament (652 votes in favour, 15 against and 27 abstentions) and contains numerous recommendations for action to develop an EU-wide strategy to combat cancer. In addition to the consequences of general nutrition (such as obesity), the proposed interventions include the effects of various types of radiation (e.g., UV radiation) and environmental pollution, as well as the consumption of tobacco and alcoholic beverages as important risk factors for cancer [6].

The demands for regulation of alcohol consumption listed in the first reports of BECA [8,9] led to widespread coverage in German media, where the wine industry received a great deal of attention [10,11,12]. Producers in particular saw themselves confronted with possible mandatory “shock images” on wine labels and an enduring damage to their reputation due to the recommended health warnings. In this context, a study cited by the World Health Organization (WHO), according to which there is no safe level of alcohol consumption [13], also caused a stir. The BECA report published in early February 2022 refers to this publication as part of the recommendations for action on alcohol consumption [9].

In the final decision paper of the EU parliamentary vote, this study is also mentioned, but several passages referring to alcohol policy measures were “toned down” in the run-up to the vote on 16 February 2022 [14]. Finally, only harmful consumption is now cited as a risk factor for cancer. In addition, the demand for health warnings was changed to “information on moderate and responsible alcohol consumption”. In summary, the following recommendations for action were introduced for the alcohol sector [6]:

• Provide improved information to consumers;
• Restricting alcohol advertising and sponsorship activities;
• Revise pricing, including consideration of increasing taxes on alcoholic beverages.

Despite the last-minute amendments to the submitted text, the EU Parliament’s vote on a Europe-wide strategy to fight cancer made it clear that alcoholic beverages are among the biggest health risk factors with regard to cancer. Regulation is becoming increasingly important in light of the EU Commission’s target of a ten percent reduction in alcohol consumption by 2025 [15]. However, the short-term adjustment of the resolution on strengthening Europe in the fight against cancer also showed that European health and alcohol policy is an area of conflict in which a wide variety of interests seem to collide.

This review aims to identify the main positions and arguments in the current political debate. In doing so, the question of which current and past developments influence European alcohol policy will also be examined. Finally, possible effects on the German wine industry will be discussed based on the findings.

For this purpose, Section 2 will first take a closer look at the current global and European alcohol policy. To be able to better classify the developments, socio-demographic and cultural differences in the attitude towards alcohol policy measures in Europe will be elaborated on. Furthermore, the scientific discourse around alcohol policy regulations will be considered. The role of the WHO as an important “guidepost” is also discussed. Section 3 deals with possible “limiting” influences on European alcohol policy. These include the scientific discourse on the harmfulness of alcoholic beverages and the effectiveness of alcohol policy measures, lack of political initiative and legal barriers. The collected findings are transferred into a discussion in Section 4, in which possible effects on the German wine industry are examined in more detail.

2. Global and European Alcohol Policy

2.1. Global Alcohol Consumption and Its Regulation

According to the World Health Organization, per capita consumption of pure alcohol globally increased from 5.5 L in 2005 to 6.4 L in 2010. It remained at this consistently high level in 2016 and fell slightly to 6.2 L per capita in 2018. While a decline has been recorded in recent years, notably in Europe, consumption increased in the Western Pacific and Southeast Asian regions, especially between 2010 and 2015 [16,17].

Despite the slight decline, the consequences of these consumption patterns are manifold according to the WHO: in addition to an increased risk of cancer, the danger of a faster spread of infectious diseases such as HIV as well as mental diseases should be emphasized. Furthermore, the connection between alcohol consumption and traffic accidents as well as domestic violence is repeatedly pointed out [16]. The consumption of alcoholic beverages is thus associated with both high social damage and economic costs [16,18,19,20]. Ten years ago, alcohol was first labelled as an “unhealthy commoditiy”, along with processed foods and tobacco, and it was thus considered a fundamental risk factor for chronic noncommunicable diseases [21]. Already in 1983, the World Health Assembly declared alcohol consumption and its consequences to be a central global health problem [22]. With the publication of the “Global strategy to reduce the harmful use of alcohol” [20], measures to reduce global alcohol consumption have been specified. The regularly published “Status report on alcohol and health” [16] and the “SAFER initiative”, which was launched in 2019 and lists “five interventions to reduce alcohol consumption“ (The five proposed SAFER interventions are: (1) Strengthen restrictions on alcohol availability; (2) Advance and enforce drink-driving countermeasures; (3) Facilitate access to screening, brief interventions and treatment; (4) Enforce bans or comprehensive restrictions on alcohol advertising, sponsorship and promotion; (5) Raise prices on alcohol through excise taxes and other pricing policies) [23] are based on this. These recommendations in particular are intended to serve as a benchmark for the global development of alcohol policy measures. At the 75th World Health Assembly at the end of May 2022, delegates adopted the “Global Action Plan 2022–2030 to strengthen implementation of the Global Strategy to Reduce the Harmful Use of Alcohol” [24]. Three policy areas, which the WHO refers to as the “Three Best Buys” [25] due to their simple political implication and high effectiveness, are repeatedly highlighted:

• Bans on advertising, which should apply to various forms of media;
• Tax increases combined with measures to curb tax avoidance;
• Restriction of the availability of alcoholic beverages, e.g., by adjusting sales hours.

2.2. The Development of Scientifically Informed Alcohol Policy

As the period of Prohibition in the United States demonstrates, more than 100 years ago, policy interventions were already a possible, though ultimately largely unsuccessful, method of regulating the availability and consumption of alcoholic beverages [26]. However, a scientific debate regarding the health and social consequences of alcohol consumption and a related recommendation for policy intervention did not emerge until decades later when the scientific classification of the consequences of alcohol consumption became increasingly important for the design of alcohol policy (regarding the demand for an “evidence-based policy” [6,27]). The first important publication in this respect was “Alcohol Policies in Public Health Perspectives” by Bruun et al. [28], in which the following conclusion was drawn: “(…) changes in overall consumption of alcoholic beverages have a bearing on the health of the people in any society. Alcohol control measures can be used to limit consumption: thus, control of alcohol availability becomes a public health issue (p. 12f.)”.

This view has since been followed by numerous contributions recommending more restrictive policy measures [29,30,31]. Recent publications, categorizing even low levels of alcohol consumption as cancer-promoting, have received considerable attention in this context [13,32,33,34,35]. In the debate concerning he regulation of global alcohol consumption, cancers play a key role.

The contributions mentioned above have consistently found great resonance in the policy recommendations of the World Health Organization and are also included in the EU alcohol policy recommendations listed at the beginning of this paper.

2.3. Alcohol Consumption in the European Union and Its Regulation

In 2016, the European Union was the region with the highest alcohol consumption in the world, with an average of 9.8 L of pure alcohol per capita [36]. There was no significant change in overall consumption between 2010 and 2016, and consumption has remained at a consistently high level in recent years [36]. In 2016, the World Health Organization attributed a total of 5.5 percent of all deaths in the European Union to the consumption of alcoholic beverages [37].

In this context, measures to regulate alcohol consumption have gained attention in the EU in recent decades. The “European action plan to reduce the harmful use of alcohol 2012–2020” [38] addresses areas such as alcohol marketing, the availability of alcoholic beverages and their pricing as important mechanisms for reducing overall consumption.

It should be noted that a variety of mechanisms for regulating alcohol consumption already exist within the European Union. However, the classic instrument of alcohol taxation, for instance, is implemented very heterogeneously [39]. Recent pricing policy measures such as “minimum unit pricing” have been established, especially in Northern European countries such as Scotland and Wales (not part of the EU) [40] and since January 2022 in Ireland [41]. In the area of alcohol marketing, codes of conduct have been implemented in many cases in addition to bans [42]. Important examples of restrictions on alcohol availability are represented by the alcohol monopolies in the Scandinavian countries [43]. In total, this covers a broad range of regulatory measures in the European Union. With the latest discussion on “shock images” and warning notices on alcoholic beverages, “soft” measures in the form of “nudging“ (Nudging refers to measures that are intended to encourage citizens to make “better” decisions by means of a gentle psychological “nudge”, without prohibiting options or changing economic incentives [44]) have also gained political attention [45].

The effects of regulation on a consumer product can be demonstrated by the exemplary developments of tobacco control in Europe over the past decades. Warning labels, tax increases, and bans on smoking in certain public areas have been drastic policy measures to reduce tobacco consumption [46]. Similar measures are now to be introduced for the alcohol sector. At the German national level, the developments seem to go hand in hand. With very similar wording, people are warned about the consequences of alcohol and tobacco consumption. Important publications in this respect are, for example, the tobacco and alcohol “atlases” of the German Cancer Research Centre (Deutsches Krebsforschungszentrum, DKFZ), which not only mention the annual death figures as important indicators of the harmfulness of both products but also discuss the preventability of the consequences of tobacco and alcohol consumption [47,48].

2.4. The Influence of Cultural Factors on European Alcohol Policy

Regarding the regulatory instruments introduced by the WHO and the EU, the attitudes towards these measures differ considerably between the individual member states due to social and cultural influences. The Protestant north of Europe and the English-speaking northwest have traditionally adopted a more restrictive alcohol policy [49,50,51]. Uhl [49] considers this attitude to be an “alcohol-critical approach”, which contrasts the “alcohol-tolerant approach” of the Catholic- and Christian-Orthodox-influenced Southern European countries. In this sense, a further distinction can be made between the alcohol policies of both parts of Europe: In the Northern European “population-level approach”, even moderate consumption has a negative connotation and citizens are to be protected from possible abusive consumption by restricting the availability of alcohol. The Southern European “problem approach”, on the other hand, draws a clear line between problematic and unproblematic consumption [49]. Looking at the European wine industry, it is clear that more restrictive attitudes towards alcohol consumption prevails in those states where there is no significant wine production.

Ultimately, the different regional attitudes are also reflected in the attitudes of the population towards alcohol policy measures. Firstly, a fundamentally higher approval for regulatory interventions among women and older citizens can be observed [52]. Secondly, alcohol policy regulation receives the greatest approval in Northern European countries in particular, while most rejection exists in Eastern European countries.

In this regard, recent developments in policies within the European Union are remarkable: according to Uhl [49], a continuous convergence towards the European average can be observed after the beginning of European integration. The abolition of customs borders and the introduction of laws applicable throughout Europe have led to noticeable trends in recent years. In Southern European countries, an increase in regulatory measures and a decline in consumption were evident, while in Northern European countries restrictions were lifted and consumption increased at the same time [49]. In this context, the growing influence of Northern European countries on the European alcohol policy is mentioned to maintain the restrictive European tenor [49,50,51].

In summary, it can be stated that attitudes towards alcohol consumption sometimes differ considerably within the European Union, but that in the course of European integration there is an increasing convergence of alcohol policies. In recent decades, the World Health Organization has proven to be an important guide for European alcohol policy. Its recommendations largely match the European Union’s efforts to curb alcohol-related harm. It can be argued that there is a common “thrust” of both institutions. Although differences between alcoholic beverages are sometimes noted by the WHO, no distinctions are ultimately made in concrete policy recommendations. This is ultimately shown by the fact that the WHO increasingly points out that alcohol in general has a harmful effect.

3. Limiting Influences on EU Alcohol Policy

3.1. The Scientific Discourse on the Harmfulness of Alcoholic Beverages

It is questionable why, despite the seemingly great efforts on the part of the WHO and the European Union, many measures have so far found little resonance in European alcohol policy—both at the national and international level. Following Stockwell et al. [53], several limiting influences are listed below (see also Figure 1).

Firstly, the persisting unclear scientific assessment of alcohol-related harm and tolerable consumption limits is of central importance. Ultimately, these assessments are crucial for political decision-making. In the scientific discussion encompassing the health consequences of alcohol consumption, there is disagreement regarding the level at which consumption is considered harmful. The short-term amendment to the resolution paper of the vote on “Strengthening Europe in the fight against cancer” places the question of a harmful consumption level at the centre of the alcohol policy debate: only harmful consumption is classified as a risk factor for cancer, while the study by Griswold et al. [13] cited by the WHO classifies any consumption as risky. Other papers, such as the meta-analysis by Bagnardi et al. [32], draw the line for moderate consumption at a maximum of 50 g of ethanol per day but indicate an increased risk for a variety of cancers, even for low consumption (“light consumption”) of less than 12.5 g of ethanol (corresponding to a maximum of one alcohol unit, the equivalent of approximately 125 millilitres of wine). Further publications draw a line for moderate consumption at two alcohol units per day—accompanied by both a reduction and increase in risk for certain cancers [54]. From the wine industry’s point of view, the so-called “Mediterranean diet” has become very popular [55]. It claims a positive correlation between a predominantly vegetarian diet with the greatest possible avoidance of saturated fatty acids and moderate consumption of red wine and the prevention of coronary heart disease. In addition, the influence of this diet on cancer has been studied. The mainly Southern European publications draw a largely positive conclusion [56,57,58].

It becomes clear that the effect on different types of cancer as well as the level of consumption that poses a health risk are sometimes classified very differently in the scientific discussion.

Furthermore, Stockwell et al. [53] state that in Europe and other parts of the world, clear scientific findings on the relationship between alcohol consumption and cancer are only slowly gaining public awareness—despite decades of research. Alcohol consumption in its abusive form is rather associated with addiction and liver diseases as well as alcohol-related road traffic accidents. The authors therefore also speak of a low public awareness regarding the extent of alcohol-related harm and a possible “obstacle” to the implication of alcohol policy measures.

3.2. The Scientific Discourse on the Effectiveness of Alcohol Policy Measures

As already discussed, the “Best Buys” of the World Health Organization primarily rely on the regulation of pricing, availability and advertising of alcoholic beverages. The WHO emphasizes the high effectiveness of these measures along with a comparatively simple implication [25]. Opposing voices address developments that primarily affect the price-demand relationship. For example, Uhl [50] argues that in Austria, alcohol prices fell by 50 percent relative to income between 1973 and 2018, but consumption declined by as much as 25 percent at the same time.

Babor et al. [30] emphasize that more restrictive and yet more effective measures, such as adjusting prices or restricting alcohol availability, is associated with greater rejection among the population than measures that rely on information and education. Li et al. [59] were able to confirm this hypothesis for Scotland and England. Due to this basic attitude among the population, Stockwell et al. [53] identify an obstacle to the implication of those measures that are rated as particularly effective by the WHO.

3.3. Lack of Political Initiative and Legal Barriers

For decades, the Scandinavian countries have shown a high propensity to regulate alcohol consumption. The alcohol monopolies in Sweden, Norway and Finland are particularly noteworthy. In the pan-European view, concrete measures are very heterogeneously designed [43]. Stockwell et al. [53] attribute this to a partial lack of political initiative. One reason for this is the fact that concrete modifications to the price and availability of alcoholic beverages are often carried out, not by the ministries of health, but by the ministries of finance and economics. In addition, “harder” drugs have become the preferred subject of political intervention in many countries, which is also reflected in the budgets of institutes conducting research on these substances [53].

Furthermore, there are legal barriers to policy at both the national and European levels. This is illustrated, for instance, by the long-standing legal dispute over Scottish minimum unit pricing [60,61]. Moreover, even supposedly “soft” regulation can meet legal limitations, as Schulz et al. [45] point out with regard to a possible influence on wine consumption in Germany through nudging. However, it is noteworthy that the ECJ in its decision regarding minimum unit pricing refers to an increase in taxes as a possible alternative and describes this as a “milder instrument” [62], an assessment which favours a central element of the WHO “Best Buys”.

4. Discussion of Implications for the German Wine Industry

4.1. Wine as a “Sin Product”

The amendments to the resolution on strengthening Europe in the fight against cancer showed that even minor textual adjustments tend to have a major impact: The distinction between moderate and harmful consumption caused a gasp of relief, especially within the wine industry. However, the current developments and their possible effects do not yet seem to have reached all industry players. The editor-in-chief of an important industry magazine recently spoke of a “Schockstarre” (in English: state of shock) when he realised the extent of possible regulations [63]. It should therefore be clearly stated that wine is distinctly classified as an alcoholic product by the WHO and the EU and is not granted a special status.

For an alcoholic beverage that is socially recognized as a stimulant and a cultural heritage, responsible and moderate consumption is of great importance. The fact that this form of consumption is not considered harmful per se seems legitimate, as harmful, abusive consumption is unanimously identified as problematic by politicians and society as well as by the alcohol industry. However, two fundamental questions concerning moderate consumption remain without a clear answer in the current scientific discussion: On the one hand, it does not seem to be clarified how moderate consumption is to be defined in concrete terms. On the other hand, the question arises as to its risks. At present, no risk assessment meets with a broad agreement, both within the research community and on the part of policymakers. The unclearly defined area of moderate consumption can thus be regarded as a “grey area”, which highlights the need for further research but also enables the industry to contribute its own arguments to the fundamental debate. In this view, alcohol industry advocacy is often seen as having a great deal of influence on policy discussions and decisions [53,64]. However, until there is clarity in light of the call for evidence-based policy, it seems legitimate to advocate for moderate and responsible consumption. Even the WHO supports industry co-regulation, e.g., in the form of health information on labels [27]. A general negative health assessment across all forms of consumption would ultimately also raise moral questions—the sale of alcoholic beverages would have a fundamentally reprehensible character. This assessment is reinforced by recent discussions around sin taxes [65]. In this respect, alcoholic beverages (wines, beers and spirits) would fall into the category of “sin products”.

4.2. Different Influences on Different Alcoholic Beverages

Even though the distinction between moderate and harmful consumption was included in the EU resolution, there is little doubt that the overall consumption of alcoholic beverages across all distribution channels will be influenced by adjustments in taxes, availability and advertising. Almost completely neglected in the current debate are “softer” measures, e.g., in the form of “nudging”. While there are legal barriers to health warnings on labels [66], Pabst et al. [67] demonstrate that even mandatory nutritional information can be associated with impacts on wine purchasing and consumption. It seems therefore unsurprising that the proposal for the introduction of a Nutri-Score with the marking of a black “F” for alcoholic beverages has caused indignation in Italy and France, especially within the wine industry [68]. Because no distinction has yet been made between different types of alcoholic beverages, the wine industry will also be influenced by regulatory interventions, just like the other industries within the alcoholic beverages sector. However, it is quite conceivable that individual alcoholic beverages may be particularly affected when it comes to dealing with the potential regulations. Spirits are particularly noteworthy due to their high alcohol content. Wine also has a significantly higher ethanol content compared to beers. It therefore cannot be ruled out that the beer industry has an advantage when it comes to differentiating itself from competing products with higher alcohol contents. As first publications indicate, already the reduction of alcohol contents in alcoholic beverages has the potential to reduce the total consumption of grams of alcohol [69]—an important goal of the WHO Action Plan (2022–2030) would thus be achieved if more consumers would prefer beverages with lower alcohol levels such as beer.

4.3. Influence on the Suppliers’ Assortments

Consequently, it seems plausible that individual industry players, such as the beer industry, are following current alcohol policy developments largely without comment. Added to this, the strategic positioning of the beer industry could play a special role here: for years, many German breweries have been completing their product range with non- and low-alcoholic beers. The industry thus focused very early on an area that would remain partly unaffected by possible regulation. In addition, these beverages are becoming increasingly popular within society. In Germany, non-alcoholic beers already reach a share of more than seven percent of the total beer market [70]. Mixed beer drinks with an alcohol content of less than 3 percent by volume reach a market share of over 20 percent [71]. The beer industry has thus decisively shaped the category “low” and therefore also the expectation regarding the low alcohol content of less than 3 percent by volume. Besides these developments, the area of “low” alcohol products is now an emerging segment, even in the non-alcoholic beverage industry as soft drink manufacturers such as Coca Cola have recently become involved in this area [72].

Although “no” and “low” alternatives from the beer industry are by far the most popular, there is also a constant trend towards such products in the wine and spirits industries [73,74]. In the wine sector, there are still few drinks that can be assigned to the category of “low”. A new brand concept, which has recently celebrated its premiere, sells products with 6 percent by volume. An innovative concept from the sparkling wine segment, on the other hand, relies on a sparkling wine with 2 percent by volume (For this product, a shipping dosage is added to a dealcoholized wine, thus initiating a second fermentation in the bottle, which produces around 2 percent alcohol by volume. The product is then riddled and disgorged in exactly the same way as a champagne, for example). However, the wine industry is also able to address policy changes, especially through alcohol-free innovations. Remarkably, there has been a steady increase in the production of non-alcoholic wines over the past few years in Germany. Altogether, non-alcoholic sparkling wines accounted for approximately five per cent of total German sparkling wine sales in 2021 [75]. By contrast, non-alcoholic still wines only have a market share of one percent, but they are steadily gaining importance [75]. In addition to large wineries and cooperatives, small family-owned wineries are increasingly entering the market [76].

4.4. Obstacles for the German Wine Industry

Compared to non-alcoholic beers, however, qualitative questions still arise for non-alcoholic wines, as the process of dealcoholisation involves greater technical effort. Moreover, new legal framework conditions for these products have been discussed, which have the potential to restrict the diversity of different product types. In concrete terms, this concerns, for example, the ban on naming geographical indications, the grape variety or the ban on certain technical interventions in winemaking, such as the chaptalization of the grape must [77,78]. These possible developments would particularly create obstacles for small and medium-sized wineries that do not have brand awareness and therefore see opportunities for differentiation, for example, through origins and grape varieties.

Overall, the German wine industry could be more severely affected by alcohol policy developments compared to other beverage industries, which becomes particularly clear in the following example: if stricter blood alcohol limits were introduced for driving, wine tourism, which plays an important role in Germany [79], could experience a significant cut, especially through the absence of day trippers. In conjunction with rising health awareness [80], alcohol-free alternatives therefore could play a key role in the future. Looking at the sale of non-alcoholic products, the trend is already manifesting itself in specialized sales outlets in Germany [81]. Therefore, it also seems interesting to discuss whether the products could address completely new target groups that may not have consumed any alcohol so far.

5. Summary

The current developments result in a broad area of conflict for the German wine industry, in which it is confronted with new scientific findings and associated demands for regulatory measures within the framework of European alcohol policy. Of central importance are restrictions on availability and advertising bans, as well as price adjustments. These are considered the WHO “Best Buys” because of their simple implication and high effectiveness. All of them could have a significant impact on the consumption of alcoholic beverages—including wine, which is clearly classified as an alcoholic product, alongside beer and spirits. However, the unclear assessments of the effects of moderate alcohol consumption result in a “grey area” in which it is ultimately up to the wine industry to communicate its own positions transparently and work towards responsible consumption with effective self-regulatory measures. Finally, the creeping changes in social attitudes towards alcoholic beverages should not be disregarded as they challenge innovations in the field of low- and non-alcoholic alternatives. In this regard, the beer industry took the lead several years ago and has made a significant contribution to shaping the categories of “no” and “low”. It thus might have an advantage when it comes to differentiating itself from competing products with higher alcohol contents. However, a dynamic development of the market for non-alcoholic wines is also clearly noticeable. Although there are new legal hurdles for winegrowers in this segment, the products could ultimately have the potential to open up new target groups.