Luxembourg hospitality groups push to untie alcohol licences from buildings

Luxembourg's hospitality sector is calling for a comprehensive reform of the country's alcohol licencing system, arguing that rules tying alcohol-serving licences to specific buildings and municipalities are outdated and concentrated in too few hands.

The demand came during a roundtable discussion hosted by RTL Radio on Saturday. Three industry figures sat on the panel: Betty Fontaine, managing director of Simon Brewery; Steve Martellini, director of the Federation of Hotels, Restaurants, and Bars (HORESCA); and Paul Ruppert, head of the eponymous beverage distributor.

Martellini said the current framework — which attaches a licence to a physical location rather than to an operator — no longer reflects how the trade works. HORESCA is now advocating a full overhaul of outlet licencing laws rather than incremental fixes.

Who holds the licences?

Ruppert put the structural problem in commercial terms. The majority of Luxembourg's alcohol-serving licences, he said, are held by two large national breweries. Their historical acquisition of those contracts was "quite legitimate", he acknowledged — but the result is a "protected market" that is "not healthy for everybody."

His argument is straightforwardly economic: in a market where the supply of licences is restricted and most of them sit with two players, other distributors and operators face a structural disadvantage on price and access. What does this change for a small bar owner in a rural commune? Under the current rules, effectively nothing — a licence stays where it is, and competition for supply stays limited.

The rural bar problem

The panellists also flagged the shrinking number of small bars, particularly outside urban centres. Fontaine framed the trend as social rather than purely commercial: as village bars close, people spend more time "rotting at home," she said, and isolation increases.

The decline runs alongside a broader shift in consumer habits. Alcohol consumption in general is falling, and younger consumers increasingly prefer fast-food outlets over traditional eateries, according to Martellini.

How brewers are adapting

Fontaine offered one concrete example of menu and product adaptation. Simon Brewery launched an alcohol-free beer line in 2019, on the reasoning that relying solely on traditional alcoholic beer — a shrinking market — is no longer a viable long-term strategy. The company had to "become more creative" to meet current demand, she said.

Her caveat matters for anyone reading the non-alcoholic trend as an easy margin play: demand exists, but the products "just have to be good." Distribution and licence reform may open the market, but product quality decides what sells once it is open.

What the numbers show

Despite the pressure on traditional bars, the sector's headline figure points up, not down. Martellini said the overall number of HORESCA businesses has grown 14% compared with pre-pandemic levels, with growth driven primarily by restaurants rather than drinking venues.

That split — restaurants and fast food expanding while small rural bars contract — is the core tension the reform push addresses. No legislative timeline was given at the roundtable, but with HORESCA, a major distributor and a historic brewery aligned on the need for change, the licencing question is likely to move onto Luxembourg's policy agenda.