Kampala, Uganda | By Michael Wandati | The Alcoholic Drinks Control Bill, 2023, proposed by Tororo District Women’s representative Sarah Opendi, has stirred considerable debate due to its contentious provision proposing the limitation of alcohol sales in bars from 5:00 pm to 10:00 pm on weekdays.
This regulation, designed to oversee alcohol consumption, faces resistance particularly from stakeholders in Uganda’s night economy.
Emmanuel Njuki, the country lead for legal and corporate affairs at Nile Breweries Limited, voices concerns about the potential negative impact on Uganda’s overall economic activity, emphasizing the pivotal role of the night economy. He questions the enforceability of the bill’s restrictions on nightclubs and highlights potential unintended consequences, such as driving consumers toward illicit alcohol markets.
“If this law is passed in its current form, it would devastate the livelihoods of everyone in the sector, including those in formalized operations. It infringes on the rights of farmers who supply raw materials for licit alcohol production; we use sorghum, barley, cassava, and corn to manufacture alcoholic beverages,” he said.
Juliana Kagwa, corporate relations director at Uganda Breweries Limited (UBL), supports the idea of regulating the alcohol trade but expresses reservations about the current form of the bill. She anticipates adverse effects on production, consumption, and demand for their products, with potential repercussions on employment opportunities and contributions to the national tax base.
Kagwa also addresses environmental concerns, supporting the ban on plastic bottles but expressing worries about the potential rise in production costs affecting micro companies.
Regarding environmental concerns, Kagwa stated, “Plastic bottles are not biodegradable and can take centuries to decompose. Discarded in landfills and water bodies, they contribute to the growing problem of plastic waste. Moreover, illicit alcohol is often packaged in plastic bottles. Banning plastic will help mitigate the negative impact of illicit alcohol. Therefore, we fully support this aspect of the bill.”
“While we are open to the idea and necessity of regulating alcohol trade, we believe the bill lacks sufficient data on the socio-economic and financial impacts of implementing some of its recommendations. Some proposals, such as the operating hours for bars being capped at 5 pm to 10 pm on weekdays, seem impractical in the short or medium term,” Kagwa said.
“With the proposed law, I anticipate a decrease in production, consumption, and demand for our products, which could negatively affect employment opportunities and ultimately lower contributions to the national tax base. Our value chain includes about 190 distributors, 106,500 retail outlets, 970 direct employees, and 50,000 grain farmers.
Each entity averages 28 employees, resulting in over 2,982,000 employees across the value chain. With each employee supporting an average of five dependents, this affects nearly 14,910,150 livelihoods across all employment categories,” she explained.
The bill, introduced by Opendi on November 14, 2023, seeks comprehensive regulation of various aspects of alcohol in Uganda, including manufacture, importation, sale, consumption, and advertisement.
Despite procedural challenges and debates, the bill advanced to its first reading in Parliament without a certificate of financial implication from the Ministry of Finance, Planning, and Economic Development, indicating the intricate legislative process involved in private members’ bills in Uganda’s Parliament.
However, this hurdle was overcome when Speaker Anita Among invoked Section 76(4) of the Public Finance Management Act, 2015.
“Since the bill had surpassed the mandatory 60-day threshold, it was thus ready to be presented on the floor of the House,” she said.
The bill was subsequently referred to both the committee on Health and the committee on Tourism, Trade, and Industry for thorough scrutiny. Later, the Ministry of Finance issued the certificate of financial implications.
The proposed legislation introduces stringent regulations for licensing, operating hours, packaging, and penalties for non-compliance. It specifically targets the sale of alcoholic drinks to minors, sets packaging standards, and addresses the prevalence of illicit alcohol trade. The bill reflects a comprehensive strategy to address social, health, and economic challenges associated with alcohol consumption in Uganda.
A key provision of the bill mandates that anyone involved in these activities must obtain a license. The responsibility for issuing these licenses falls to the town clerk, the Kampala Capital City Authority (KCCA), and chief administrative officers. Each license, once issued, will remain valid for a period of 12 months from the date of issue.
Opendi has outlined specific operating hours for the sale of alcoholic drinks and native liquor under the proposed legislation. Licensees will be restricted from selling alcoholic beverages before 5:00 pm and after 10:00 pm on working days. However, more lenient operating hours are proposed for public holidays and weekends, allowing sales from noon until after midnight.
The bill also establishes severe penalties for non-compliance. Individuals or entities found guilty of contravening these regulations face substantial fines and imprisonment. Specifically, a fine of up to Shs 20 million or a prison sentence of 10 years, or possibly both, can be imposed for selling alcohol outside of the prescribed hours or operating without a license.
Furthermore, the bill stipulates that all alcoholic drink packages must include detailed information about their contents and health warning messages. Failure to comply with this packaging requirement could result in a Shs 10 million fine or a five-year jail sentence.
The proposed legislation aims to regulate the alcohol industry tightly, with the goal of reducing alcohol-related harm and ensuring consumer safety. By setting these stringent rules and penalties, Opendi seeks to address various social and health issues associated with alcohol consumption in Uganda.
Concerns from various stakeholders, including prominent figures like Dr. Timothy Batuwa, Emmanuel Njuki, and business owners in the bar and nightlife industry, highlight the delicate balance required in regulating the alcohol sector. The potential economic impact, job losses, and the need for responsible drinking are essential considerations in shaping effective and balanced regulatory frameworks.
Clause 25 of the proposed Alcoholic Drinks Control Bill, 2023, as presented by Opendi, sets forth stringent penalties for the sale of alcoholic drinks to minors. The bill stipulates a hefty fine of Shs 40 million or imprisonment for up to three years, or both, for individuals convicted of selling alcoholic beverages to children under the age of 18. This provision underscores a significant effort to protect minors from early exposure to alcohol.
The bill also introduces restrictions on alcohol consumption in specific public settings. Upon becoming law, it would prohibit the sale and consumption of alcoholic beverages in Public Service Vehicles and by law enforcement officers in uniform. Violations of this rule would attract a fine of Shs 4 million or imprisonment for up to six months, or both, reflecting a commitment to maintaining public order and safety.
Furthermore, the bill mandates strict verification of age for alcohol purchases. Vendors are required to confirm that buyers are above the legal age of 18. In cases where a buyer’s age is uncertain, the bill allows for age verification through official documents like a national identification card, a passport, or other documents as may be prescribed by the minister. Failure to comply with this provision, resulting in the sale of alcohol to a minor, would lead to severe penalties, including a fine of up to Shs 40 million.
These measures within Opendi’s bill are part of a broader strategy to regulate alcohol sales and consumption, with a particular focus on safeguarding minors and maintaining public decorum. The bill reflects a comprehensive approach to addressing the social and health challenges associated with alcohol abuse in Uganda.
Opendi introduces specific regulations regarding the packaging of alcoholic drinks in Uganda. One of the key provisions in the bill is the prohibition of packing, importing, or selling alcoholic drinks in sachets, plastic bottles, or similar forms.
The rationale behind this restriction is likely to address issues related to environmental pollution and public health concerns associated with such packaging. Violation of this regulation is considered a serious offense, attracting a fine of Shs 20 million or imprisonment for up to five years.
Additionally, Opendi’s bill sets a minimum packaging size for alcoholic drinks. It states that alcoholic beverages should not be packed or imported in containers smaller than five hundred milliliters. This measure seems aimed at curbing excessive alcohol consumption and controlling the availability of alcohol in small, easily consumable quantities. Non-compliance with this stipulation is met with severe consequences, including a fine of Shs 5 million or imprisonment for a duration of five years.
Curbing illicit alcohol trade in Uganda: A vital economic endeavor
The 2020 Economic Development in Africa Report, released by the United Nations Conference on Trade and Development (UNCTAD), sheds light on a formidable economic challenge faced by the continent – illicit trade.
Africa grapples with an annual loss of approximately $88.6 billion due to illegal trading activities, a predicament resonating significantly in Uganda, where the country experiences an estimated annual loss of Shs 50 billion.
A substantial portion of Uganda’s economic hemorrhage is attributed to the alcohol market, with around 65 per cent operating outside the formal economy. This unregistered and uncertified segment evades contributing to government revenue through taxes, posing grave health risks to consumers as its products lack the safety and quality standards set by authorities.
Alarmingly, the 2021 Euro Monitor International report signals an upward trend in Uganda’s alcohol consumption patterns, indicating a rise to 64.7 per cent. This surge not only intensifies public health concerns but also undermines the country’s economic development. Illicit alcohol consumption diverts potential tax revenue away from government coffers, funds that could be allocated to vital public services and development projects.
These reports underscore the pressing need for effective regulation and enforcement in Uganda’s alcohol sector to staunchly curb the proliferation of illicit trade. Implementing such measures not only safeguards public health but also fortifies Uganda’s economy by fostering a fair and regulated market that contributes meaningfully to national revenue.
Addressing Uganda’s alarming alcohol consumption rates
The World Health Statistics 2023 Report positions Uganda among the top countries globally in terms of alcohol consumption rates. Shockingly, Uganda’s annual alcohol consumption per capita stands at 12.2 liters, a figure significantly surpassing the African region’s average of 6.3 liters and the global average of 6.18 liters, as reported in the WHO’s Global Status Report on Alcohol and Health in 2018.
Seychelles closely trails Uganda in alcohol consumption, with an average annual consumption of 11.99 liters of pure alcohol per man and 4.72 liters per woman. Tanzania secures the third-highest position with an average annual consumption of 10.36 liters per person.
This heightened rate of alcohol consumption in Uganda is a cause for concern, given its associated health risks and far-reaching social and economic implications.
The harmful use of alcohol contributes significantly to the country’s disease burden, impacting individual health and straining the healthcare system. Moreover, excessive alcohol consumption leads to social consequences like family and social disruption, and economic ramifications such as lost productivity, compounding the issue.
These statistics underscore the urgency for Uganda to implement effective public health strategies and policies to combat alcohol abuse. These measures are imperative not only for mitigating the health risks associated with excessive alcohol consumption but also for addressing its broader social and economic impacts.
Opendi’s 2016 decision on Nambooze’s Bill
On October 5, 2016, Betty Nambooze Bakireke, the Member of Parliament for Mukono Municipality, introduced the Alcoholic Drinks Control Bill 2016. Despite gaining popularity among female legislators and some male MPs, the bill faced resistance from the government.
In a recent interview with NBS TV, Nambooze reflected on the bill’s journey, revealing that she initially wanted to present a Member’s Bill on alcohol when Sarah Opendi was in the Ministry of Health. However, despite inquiries about its progress, the bill was not reviewed. Now, with Opendi presenting a similar bill to the House, Nambooze expresses no objection, emphasizing their shared goal of regulating alcohol.
This historical perspective highlights the persistence of efforts to regulate the alcohol industry in Uganda and the challenges faced by such legislative initiatives.
Uganda’s nightlife industry concerns
Stakeholders in Uganda’s nightlife industry express apprehension about the proposed Alcoholic Drinks Control Bill, particularly its impact on business revenue. Owners and managers of bars and lounges, including Joshua Kayongo of Vibes Lounge and Bar, and Timothy Muhwezi of Nina Lounge and Bar, voice concerns about potential job losses and adverse effects on the night economy due to restrictions on operating hours.
The apprehension extends to patrons like Sarah, who predicts disruptions in business and a decline in sales, especially during lucrative late-night hours. Shaka, the communications officer at Catwalk Lounge Kololo, warns about the negative impact on government tax revenue, highlighting the substantial contributions made by bars to the tune of over Shs 1 trillion.
These perspectives collectively underscore the shared concern among stakeholders in the alcohol sector. While regulation is deemed necessary for public health and safety, a balanced approach is crucial to avoid unintended negative economic consequences. Striking this regulatory balance remains a significant challenge in legislative decision-making.
Drawing lessons from the UK’s experience, where the midnight drinking rule was abolished in 2003, Uganda faces the challenge of finding a balance between promoting responsible drinking and maintaining a vibrant nightlife. The UK’s shift toward flexible licensing hours allowed for local adaptation and aimed to address concerns related to binge drinking and alcohol-related violence.
In conclusion, the Alcoholic Drinks Control Bill, 2023, prompts critical discussions on regulation, societal impacts, and economic considerations. The complexities involved underscore the need for thoughtful, balanced, and evidence-based approaches to address the multifaceted challenges associated with alcohol consumption in Uganda.