As ludicrous as it might seem, if there is a financial penalty to pay (or if there is a threat of losing your trading licence) in the event vendors sell cigarettes or alcohol without checking ID, then I suppose it really is a matter of the law coming to direct conflict with common sense. Usually common sense prevails but if someone wants to implement the law they are not doing anything wrong.
with cameras in stores 24/7 its hard to let stuff like that slide even if you wanted to.