Food & Drink

A Spirit by Any Other Name: How Brexit Could Affect Scotch Whisky

Scotch whisky sales (and dedicated drinkers) could be seriously affected by Britain’s “Brexit” vote tomorrow. If the country decides to leave the EU, the spirit would be stripped of one of its biggest advantages on the international market—its exclusive name.

Like Plymouth Gin in the U.K. and other European spirits like pastis, Cognac and calvados, scotch enjoys protection under the European Parliament’s Protected Designation of Origin regulations. In exchange for strict guidelines on production, scotch distillers get the exclusive right to the label “Scotch whisky,” along with that phase in any combination with words like “style” or “flavored.” Without these safeguards, any distiller around the world could call a product “scotch.”

Since the union first shortlisted 41 products for international protection in 2003, that list has grown exponentially. Today, the U.K. alone has 73 goods under the protected food name scheme—like certain Cheddar and Stilton cheeses and Cumberland sausage—but scotch is the power hitter of the group, responsible for $5.47 billion in annual revenue and 10,000 jobs in Scotland.

According to the Scotch Whisky Association, about a third of those sales are to other EU nations. Though scotch distillers could conceivably re-establish trade regulations, an “out” Brexit vote could anger European drinkers, who might switch to more readily available, continental European spirits out of spite. In that way, an “out” Brexit vote could actually be a boon for European spirits like genever and Armagnac.  According to Bloomberg, global scotch producers like Pernod Ricard and Diageo are pro-union, not only to uphold naming rights, but also because the U.K.’s exit could unravel trade deals beyond Europe like in the booming Indian spirits market.

If Britons do vote to leave the EU, there are alternative protections available to scotch producers, but none as fundamentally conducive to the liquor trade. As Eater points out, distillers could apply for UNESCO Intangible Cultural Heritage status. But without the buying power of the entire EU to back it up, the UNESCO designation carries more weight for tourism and cultural pride than help with actual economic protection. Even Prime Minister David Cameron isn’t confident he can negotiate new protections.

With polls still split on the eve of the vote, Brexit could go either way. After the vote, scotch producers will either be celebrating with a dram of still legitimate scotch whisky or commiserating over slugs of “scotch” from a far flung land.