NORWAY: Diageo loses import license for breaking marketing laws
Diageo's Norwegian subsidiary, Guinness UDV Norway, will not be able to import or sell any alcohol in the country for six months, after the country's Social & Health Directorate temporarily revoked its licence for breaking laws on alcohol marketing.
The ban, which will come into place on the 12th August, is the result of a marketing drive for the launch of Smirnoff Ice, which broke the country's very strict laws on drinks promotions. Although Diageo is allowed to market to the trade it cannot do so to the public. However, according to sources close to the event certain trade events for the RTD product split over into the public domain.
The company "broke the Norwegian alcohol laws several times, which in each instance makes this case particularly serious," said Gunn-Ellin Bjoerneboe, the Directorate's acting director.
Norway is thought to make up around 0.2% of Diageo's trading profits so the ban will impact on the company's trading profit by between £0.5m and £1.5m.
Diageo said it was reviewing the letter it had received from the Directorate and was "engaged in an ongoing dialogue with the directorate in relation to these matters."
The ban is thought to be the first of its kind and Diageo said: "This is a very strict reaction by the Direcotrate, which will mean considerable difficulties for the company. It is also clearly a stricter reaction than we had hoped for after the discussions the company has had with the directorate since the matter came to light."
The company is advising customers that they should continue to place orders in the normal way and that they will be advised of any changes in arrangements.
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