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. Last Updated: 07/27/2016

State Will Require Labels on Alcohol

Labels on beer, wine and liquor will soon warn potential buyers in large print about the dangers of imbibing in a further blow to the industry’s sales as part of President Dmitry Medvedev’s drive for healthier lifestyles, the government said Thursday.

Officials will also weigh the pros and cons of creating a state-run monopoly on the $52 billion market in a report that will be submitted to the president in the first quarter of next year, according to a set of measures released Thursday.

The measures also require more sophisticated excise stamps on bottles and ban retail sales in certain locations.

If approved, they will likely affect U.S. and European imports, which are estimated to account for 10 percent of the market, and foreign brewers operating in the country, such as Carlsberg.

The restrictions, which have been discussed throughout this year, would follow the tripling of excise duties on beer slated to start next month. The State Duma voted to raise the duties after Medvedev lashed out at the “colossal” alcohol consumption rates earlier this year.

Government agencies must assemble a set of standards for alcoholic beverages, including beer, and submit them to the Cabinet in the first quarter of next year, according to a list of measures that Prime Minister Vladimir Putin signed Monday. Under the standards, warnings about alcohol’s harmful effects must take up 20 percent of the size of the label, Interfax reported.

Currently, hard liquor labels say in fine print that, “Alcohol is not for children and teenagers up to age 18, pregnant and nursing women, or for those with diseases of the central nervous system, kidneys, liver and other digestive organs.” It was unclear Thursday whether the wording would change under the new standards.

Beer bottles currently carry no health warning.

A spokeswoman for the country’s largest brewer Baltika, part of Denmark-based Carlsberg Group, declined to appraise the potential effects of the government’s labeling proposal.

“The measure is still at the formulation stage and much may change in the process of discussions,” the spokeswoman, Tatyana Antonchik, said by e-mail from St. Petersburg.

A market expert dismissed the possibility that larger warnings on alcohol labels could affect the industry’s sales.

“People buy alcohol and tobacco to enjoy it, regardless of the drawings on them,” said Vadim Drobiz, director of the Center for Research of Federal and Regional Alcohol Markets. “Let it be 30 percent — it won’t scare anyone away.”

Higher excise duties appear to be making a difference.

Carlsberg, the world’s fourth-largest brewer, on Thursday raised its full-year operating profit forecast by 3 percent to $1.8 billion after Russian distributors increased inventory ahead of the jump in beer excise duty. The tax increase is causing Russian distributors to bring forward purchases, though it will have the opposite effect on sales in the first quarter of 2010, it said.