The Scottish government’s deposit return scheme (DRS) plans could damage margins and ranging in the alcohol and soft drink categories, according to experts.

Minimum unit pricing in Scotland raised alcohol prices, but cross-border transport of goods prevented suppliers from taking a share of this margin growth. 

Coronavirus: DRS delayed until 2022

However, newly published plans for DRS ban everyone but suppliers from registering lines as DRS-compliant, giving manufacturers the ability to create Scotland-only lines and restrict cross-border sales. 

SGF head of public affairs John Lee said: “This is a problem. I imagine alcohol producers will exploit this loophole.”

The ban on anybody but the supplier registering products would also damage the market for imported soft drinks.

Scottish government to unveil DRS law in two weeks

Most of these lines are imported without the knowledge of the manufacturer, but unless overseas suppliers sign up their lines, the current legislation would make them illegal to sell. 

Senior NFRN figure and Family Shopper Blantyre owner Mo Razzaq said: “The Scottish government should allow the importer to take responsibility for the product.” 

Experts also warned the cost for small drinks suppliers in registering their products under the scheme would harm competition with larger players after DRS is introduced in July 2022.

Concern over crushed glass in DRS machines