Alberta has elected to pick on Ontario as it is the biggest liquor market in Canada. May also be called out for trade barriers, this is for other provinces as well.
EDMONTON – The Alberta government is opening a new front in its beer war with other provinces. They are doing this by targeting Ontario for what it says are its unfair trade barriers. These barriers they claim are for Alberta-made suds and other alcoholic products.
The initiative emerged as Alberta announced a full retreat on its own craft beer subsidies. Some findings of a judge were found as unconstitutional last spring.
“Alberta has the most open liquor policy in the country, offering Albertans a choice of over 3,700 Canadian products. … Alberta merchants stock and sell 745 alcoholic beverages from Ontario,” said Economic Development and Trade Minister Deron Bilous. He said that at an Edmonton brewery on Monday. “Ontario is the largest market in the country. This is three times larger than our own. Irrespective of that we can only find about 20 Alberta liquor products listed for sale in Ontario.”
Being made against Ontario, there is a complaint that has been lodged under the Canadian Free Trade Agreement. The reason, it has the biggest liquor market in Canada. However, it could be expanded to include other provinces with similar barriers, Bilous said. He also added that he’s hoping for an amicable solution.
Under the CFTA, Ontario will have 120 days to respond to the complaint made in a letter sent Monday morning. The complaint may then proceed to a CFTA panel for a ruling on corrective actions. Furthermore, allowed retaliatory measures, with a provision for either side to appeal that ruling. This is explained by Jean-Marc Prevost, Bilous’ press secretary
The Liquor Control Board of Ontario said in a statement Monday. They said that it is aware of the Alberta action. Also added that “breweries from anywhere in Canada are equally able to access our listing process.”
In his letter to Ontario Trade Minister Todd Smith. Bilous complains that Ontario gives local brewers access to stores over Alberta brewers. It also gives Ontario beverages preferential shelf or refrigerated locations. Hence, requires Alberta brewers to provide commercially confidential information to their larger competitors. Required to be listed as this information holds some key facts. Further, it gives Ontario small brewers a significant discount on listing costs.
Surprised by Alberta’s move, here is what Smith said;
“Just last week, I sat across from representatives from the government of Alberta. Not even once did they mention this to me,” he said in a statement.
“Regarding the interprovincial trade barriers for reducing, this is a commitment from the Government of Ontario. This is as we made clear in our fall economic statement when we said we wouldn’t stand in the way of pipeline projects moving forward.”
Neil Herbst, the owner of Alley Kat Brewery of Edmonton, said he has faced numerous non-tariff barriers when trying to ship his products to Ontario, giving as an example a $400 laboratory fee assessed on a shipment of $1,600 worth of beer
Also Monday, Alberta Finance Minister Joe Ceci said he will cancel by Dec. 15 a program of grants for small Alberta craft brewers in order to bring provincial beer regulations in compliance with Canadian trade law.
The province will return to a system similar to that was in place before 2015. $1.25 per liter i.e. a tax collected for the province, also known as markups. The producers of 50,000 hectolitres per year of all the beer sold in Alberta, the costings are applicable to all of them. Smaller brewers, regardless of the province of origin, will be able to apply for markups of between 10 and 60 cents per liter.
Alberta dropped its graduated markup system to go to a flat markup on all beer in 2015. It at first exempted brewers in Saskatchewan, B.C., and Alberta, then changed its rules so it applied to all Canadian brewers but introduced a subsidy program solely for Alberta’s small brewers.
It lost a CFTA panel ruling initiated by Artisan Ales, a Calgary-based beer importer, which argued the grant program unfairly tilted the market against its product.
Last June, a Court of Queen’s Bench judge ordered the province to pay a total of $2.1 million in restitution to Great Western Brewing of Saskatoon and Steam Whistle Brewing of Toronto, finding that the subsidies created a trade barrier against their products.
At the time, Ceci said the province would consider appealing that ruling His department says Alberta now has 137 liquor manufacturers, including 99 brewers. The number of brewers has risen significantly three times. Introduced in 2016, the subsidy program is a major reason for such an increase.
The province says it will introduce more supports for Alberta liquor manufacturers in the next few weeks