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Basa takes government to court over previous ‘irrational’ alcohol bans

The Beer Association of South Africa (Basa) says the previous alcohol bans had a devastating impact on the industry and has therefore turned to the High Court of South Africa to argue the decisions as irrational, invalid and that they be set aside.

“The application focuses on the decisions by the Minister of Cooperative Governance and Traditional Affairs to enforce alcohol bans in July and December 2020, June 2021 as well as the decision to continue imposing further restrictions on the trade of liquor in and during July 2021,” Basa said in a statement.

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The association says the booze industry lost R42.2 billion in retail sales, while R60.7 billion was lost to GDP.

Moreover, the total excise income tax loss was R10.2 billion with just over 233 000 jobs placed at risk. By January 11, 2021, 30% of local breweries were forced to permanently shut their doors and 165 000 people had already lost their jobs.

“The bans also served as a major boost to the illicit alcohol industry which grew to be worth more than R20.5 billion in 2020,” Basa added.

Basa noted that due to no evidence having been provided by government to support its decisions to impose the previous bans, it’s application argues that it failed to take into account the devastating impact of the bans on the alcohol industry and for this reason, (amongst others) these decisions are reviewable and destined to be set aside in terms of the Promotion of Administrative Justice Act (Paja).

“Furthermore, Basa argues that if the court finds that Paja is not applicable in this application, then the decisions to ban alcohol – being the exercise of a public power – may be reviewed and set aside in terms of the principle of legality. This principle requires all exercises of public power to be rational,” the association added.

“Basa contends that the decision to ban alcohol could not be rational in light of there being no evidence to date which government considered and presented regarding the adverse financial implications to the alcohol industry and/or how it would serve to boost to the illicit alcohol industry. Therefore, the previous alcohol bans should also be declared constitutionally invalid.”

According to Basa, another alcohol ban over the coming festive season will serve as the final nail in the coffin for thousands of businesses and citizens who just barely survived the previous bans. It says if anything, it expects some recovery in the tourism and hospitality sector over the holiday period.

Palesa Mofokeng is a Moneyweb intern.

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