Imperial Tobacco Ltd v The Lord Advocate (Scotland)

Factual and Procedural Background

The Scottish Parliament enacted the Tobacco and Primary Medical Services (Scotland) Act 2010 (“the 2010 Act”). Chapter 1 of Part 1 contains:

• Section 1 – a prohibition on the display of tobacco products at retail premises.
• Section 9 – a prohibition on the availability of cigarette vending machines.

Company A (“Appellant”), a tobacco manufacturer and retailer, petitioned for judicial review on the ground that both sections exceeded the legislative competence of the Scottish Parliament under the Scotland Act 1998. Judge Bracadale (Outer House) dismissed the petition, and the First Division of the Inner House (Judge Hamilton, Judge Reed and Judge Brodie) refused the reclaiming motion. The Appellant appealed to the Supreme Court. Shortly before the hearing it abandoned two earlier grounds, leaving three competence arguments. The Advocate General was granted permission to intervene.

Legal Issues Presented

1. Whether Sections 1 and 9 “relate to” the reserved matter of “the sale and supply of goods to consumers” in Section C7(a) of Schedule 5 to the Scotland Act 1998.
2. Whether the same provisions “relate to” the reserved matter of “product safety” in Section C8 of that Schedule.
3. Whether they breach paragraph 2 of Schedule 4 to the 1998 Act by “modifying” Scots criminal law that is special to reserved matters, given that they create new offences connected with tobacco sales.

Arguments of the Parties

Appellant's Arguments

• The words in Section C7(a) must be given their ordinary meaning; any regulation affecting retail tobacco sales inevitably concerns the “sale and supply of goods to consumers,” a reserved matter.
• Sections 1 and 9 fall within “product safety” because powers under the Consumer Protection Act 1987, Section 11, have previously been used to regulate tobacco for health reasons; therefore product safety is reserved.
• By creating new criminal offences linked to tobacco retailing, the Scottish Parliament has “modified” the law on a reserved matter in breach of paragraph 2 of Schedule 4.

Respondent's Arguments

• The purpose of the provisions is the promotion of public health—an undisputed devolved matter—by reducing the visibility and availability of tobacco products.
• Consumer-protection reservations in Section C7 concern contractual fairness and market behaviour, not measures designed to deter consumption altogether.
• “Product safety” under Section C8 addresses standards ensuring goods are safe; the impugned sections do not regulate the intrinsic safety of tobacco products but discourage their purchase.
• The new offences do not alter existing rules governing reserved matters; they merely attach criminal sanctions to devolved public-health policy.

Table of Precedents Cited

Court's Reasoning and Analysis

The Court, per Judge Hope (with Judge Walker, Judge Hale, Judge Kerr and Judge Sumption concurring), adopted a three-stage analysis:

1. Identify the purpose of the impugned provisions. Sections 1 and 9 aim to reduce smoking by limiting the visibility and physical availability of tobacco products.
2. Interpret the relevant competence rules.
   • Sections 29–30 of the Scotland Act 1998 and Schedules 4 and 5 are to be construed by ordinary statutory principles; being a “constitutional statute” does not alter that approach.
   • Schedule 5 Section C7 (“Consumer protection”) covers regulation designed to protect consumers from unfair trading practices, chiefly contractual and market-behaviour matters.
   • Schedule 5 Section C8 (“Product safety”) concerns standards ensuring goods are safe in a single UK market context.
   • Paragraph 2 of Schedule 4 prevents Scottish legislation from modifying—in the sense of altering—criminal rules that are special to a reserved matter.
3. Apply the rules to Sections 1 and 9.
   • Consumer protection: The provisions do not regulate the terms or fairness of tobacco transactions; instead they discourage the transactions altogether. Therefore they do not “relate to” the reserved matter in Section C7(a).
   • Product safety: They do not set safety standards or prohibit unsafe products; they aim to improve public health by reducing demand. Hence they do not “relate to” Section C8.
   • Modification of criminal law: Although new offences are created, they do not amend or alter existing offences contained in UK regulations on product safety. Consequently no “modification” of the law on reserved matters occurs.

The Court noted that even if an incidental consequence of the provisions was to affect trading, that consequence was merely a means to the public-health end and would not, under the Kaye v Burrows formulation, render the legislation incompetent.

Holding and Implications

APPEAL DISMISSED. Sections 1 and 9 of the Tobacco and Primary Medical Services (Scotland) Act 2010 are within the legislative competence of the Scottish Parliament.

Immediate effect: the deferred commencement of the display and vending-machine prohibitions may now proceed. Broader implications: the decision affirms a purposive, but textually grounded, approach to devolution competence, signalling that public-health measures aimed at discouraging harmful products are unlikely to be categorised as “consumer-protection” or “product-safety” reservations unless they directly regulate the safety or contractual terms of the product itself. No new precedent was created, but existing principles on statutory interpretation and devolved competence were clarified and reinforced.