History
Vinmonopolet has had an exciting and engrossing history. Its creation, for instance, was virtually imposed on the Norwegian government by France in order to ensure stable distribution of wine to all parts of the country.
Major alcohol problems
Norway faced major alcohol problems in the 19th century. Legislation was liberal, and advances in production techniques helped to encourage growing use of spirits. This peaked around 1830-40, when spirits accounted for 80-90 per cent of Norwegian alcohol consumption. Estimates suggest that each adult Norwegian drank about 13 litres of neat alcohol in the form of spirits during these years. Norway's alcohol consumption has never been higher, before or since.
Growing misuse fuelled a growing campaign against strong drink. Part of the strategy adopted by the temperance movement was the establishment of "local licensed premises" - municipally controlled wine and spirits shops which aimed to eliminate private profit motives from this sale. Although privately owned, their profits were devoted to the "public good". The first of these outlets opened in 1871 in the southern port of Kristiansand.
Prohibition
A nationwide referendum on prohibiting sales of spirits and fortified wine was held in Norway during 1919. This proposal won 61.6 per cent of the votes cast, but trade considerations meant that prohibition was not enacted until 1921.
The wine-producing nations were not particularly happy with such a ban, and their objections had to be taken very seriously because Norway exported large volumes of dried fish and other commodities to these countries. Securing good trade agreements with the wine producers was made all the more difficult by the economic crisis, which began in 1920. France was only willing to accept a deal, which allowed Norwegians to buy as much table wine of any kind as they wanted.
A centralised monopoly would prevent the arbitrary local variations, which prevailed in Norway, it was claimed. This argument made a big contribution to the creation of Vinmonopolet as a private limited company under government control on 30 November 1922.
Covering both import and sales, the company's monopoly was intended to make wine available nationwide while taking account of the social concerns associated with alcohol use. When prohibition was repealed on fortified wine in 1923 and spirits in 1926, Vinmonopolet took over the sale of these commodities.
Into public ownership
Mixing private profit with a trading monopoly proved to have a number of defects. A court case in 1930 exposed major deficiencies in Vinmonopolet's procurement routines, and the arrangement was reviewed afresh. Procurement procedures were opened to inspection and formalised to reduce the power and influence of individuals. Although Vinmonopolet was tied more closely to the state, it remained a limited company.
The business became subject to a special Vinmonopol Act on 19 June 1931, removing it from the scope of the regular Joint Stock Companies Act. Directors and the president are appointed by the government. The board is also bound to observe directives issued by the Ministry of Health and Social Affairs. After the private interests had been gradually bought out, Vinmonopolet became wholly state-owned in 1939.
Vinmonopolet is split up
The European Economic Area (EEA) agreement, which came into effect on 1 January 1994, put renewed pressure on the monopoly system. Vinmonopolet's sole import and wholesaling rights were held by the Efta Surveillance Authority to conflict with the agreement.
As a result, these parts of the monopoly were repealed on 1 January 1996. At the same time, Vinmonopolet was split up. A new state-owned company, Arcus, took over its import and wholesaling operations as well as the monopoly of spirits production and bottling. Vinmonopolet became a pure retailing monopoly.
It was clearly established in 1997 that the wine and spirit monopoly, as currently organised, is compatible with the EEA agreement. The Efta court first accepted, in the Wilhelmsen case, that Vinmonopolet could have the sole right to sell strong beer. An important issue of principle was then decided by the European Court in connection with Systembolaget, Sweden's equivalent of Vinmonopolet. The court confirmed that the Swedish system did not breach European Union rules on trading monopolies. At the end of the year, the Gundersen case from Norway was also in reality settled when the Efta court determined that Vinmonopolet's monopoly of table wine sales does not contravene the Efta agreement.
