A vote for Scotch whisky

With the general election starting pistol fired on 22 May 2024, minds turn to the coming years ahead and how to ensure the continued growth of the economy. As we toast the successful party, it is hoped that they commit to investment and support for the Scotch whisky industry.

As identified in the Scotch Whisky Association’s (SWA) recent election manifesto, the Scotch whisky industry presents important benefits and opportunities to the Scottish and UK economies. The SWA report that the Scotch whisky sector contributes GBP7.1 billion to the UK economy annually. Scotch whisky accounts for 26 percent of UK food and drink exports (that figure is 77 percent in Scotland), with 1.35 billion bottles exported in 2023 (or, 43 bottles every second). The Scotch whisky industry supports 66,000 jobs in the UK - 41,000 of which are in Scotland, with many in rural areas where the industry (including tourism) is the principal source of employment.

The industry presents significant international trade opportunities. The SWA reported that, with exports of GBP1.8 billion in 2023, Asia Pacific is the most valuable export region, with particular growth in China. The US remains Scotch whisky’s largest export destination, buoyed by mutual suspension of tariffs on the trade of single malt Scotch whisky and Bourbon and American whiskey until June 2026. India is a priority growth market, with hopes of a trade agreement.

Within the domestic market, there has been something of a boom in recent years, with the re-opening of distilleries (including Port Ellen, Islay and Rosebank, Falkirk). New distilleries and excise warehouses have opened, and there has been a trend for opening visitor centres and restaurants at distilleries to cater for increasing numbers of visitors. Johnnie Walker on Princes Street, Edinburgh is an example of marquee retail premises being repurposed into a leading whisky experience.

With growth and excitement comes some challenges. Development and participation must be carried out properly, and there is a balance between innovation and preserving the craft and history of the industry. On 30 May 2024, the SWA and HSE published guidance (The Guide to Applying for Hazardous Substances Consent) to assist distillers with the planning consent process for expanding production in distilleries and opening excise warehouses; demonstrating industry working with stakeholders to facilitate development whilst maintaining standards.

DLA Piper has a specialist Scotch whisky practice, advising domestic, international and global clients through its Consumer Goods sector. In an industry with an unusual regulatory framework, we have established connections with stakeholders to provide advice which incorporates black letter law and custom and practice. In recent years, we have seen a rise in investment in distilleries and the acquisition of buildings for excise warehouses to meet increased demand. For investors, it remains important to verify provenance, and we have implemented a comprehensive verification process, tracking the spirit through its lifecycle from cask to bottle.

The opportunities presented by the Scotch whisky industry are exciting and essential to the Scottish and UK economies. We hope that whoever takes the majority of seats at Westminster commits to the continued growth and success of Scotland’s national drink – the unmistakable and irreplaceable Scotch whisky.