Wine Shipping
High on the list of impediments to the prosperity and growth of BC wineries is Canada’s entrenched regime of interprovincial trade restrictions.
Now, BC wineries are fighting back, applying for intervenor status in the landmark R v. Comeau case - a constitutional challenge of Canada’s interprovincial trade barriers.
While three provinces (BC, Nova Scotia, and Manitoba) have open door policies, consumers in the rest of Canada are prohibited from freely importing BC wine for personal use by their respective provincial governments.
Gerard Comeau of Tracadie, New Brunswick found that out the hard way in 2012 when he purchased 354 bottles of beer and three bottles of spirits in Quebec and attempted to drive them home. The RCMP stopped his car in a targeted sting operation when he crossed the provincial line. The shocked Comeau was detained, stripped of his liquor and fined $292.50 for violating the province’s liquor act.
Fortunately, that was not the end of the story. In his decision to acquit Comeau, Justice LeBlanc of the New Brunswick Provincial Court held that “134(b) of the Liquor Control Act of New Brunswick constitutes a trade barrier which violates section 121 of the Constitution Act, 1867 and is therefore of no force or effect as against Gérard Comeau.”
Nothing is simple about this case, but Section 121 of the constitution states emphatically that “All articles of the Growth, Produce, or Manufacture of any one of the Provinces shall, from and after the Union, be admitted free into each of the other provinces.”
Given the legal implications of Justice LeBlanc’s decision on the closed liquor board monopolies, it is no surprise that the Crown appealed the decision to the Provincial Court of Appeal. When that court refused to hear the case, it was appealed to the Supreme Court of Canada, which has agreed to hear the Comeau case on December 6 and 7.
Joining New Brunswick’s appeal as intervenors are an array of nine provinces including Quebec, Ontario, Alberta and British Columbia, plus two territories, and the Attorney General of Canada.
But Comeau will not be without interveners in support of more open free trade within Canada. “The Canadian Vintners Association (CVA) with the BCWI and other associations in support of a strong and unified industry intervention to support the interests of all 100% Canadian wines and wineries in all regions across Canada,” says Miles Prodin, President & CEO of Wine BC.
Another prime backer of Gérard Comeau’s case for interprovincial free trade is the Canadian Constitution Foundation (CCF), an independent, non-partisan charity committed to defending the constitutional rights and freedoms of Canadians in the courts of law and public opinion.
To highlight how important the case is for small BC wineries, a group of BC wineries have banded together to prepare a joint application to intervene to put forward the case for small wineries.
Originators of the application include Liquidity Wines, Painted Rock Estates, 50th Parallel Estate, Okanagan Crush Pad and Noble Ridge Vineyard.
Ian MacDonald, owner of Liquidity Wines, explains the predicament of small and mid-size wineries which are overly dependent on tasting room sales, a risky proposition especially in a year such as this when fires and floods inhibit tourism.
“As it is, a majority of small wineries do not make money,” he says. “As labour intensive farming businesses that grow grapes and make wine, wineries make an important contribution to the economy.”
Critical to the survival of small and medium-sized wineries, according to MacDonald, is direct-to-consumer (DTC) shipping across Canada of wine for personal use free of tariff and non-tariff trade barriers.
“Consider California’s story,” McDonald says. “Representing over 60% of sales, DTC shipments across state lines have allowed small wineries to survive and flourish.”
Retained by the group to give small wineries a “voice,” in order “to tell their story at the hearing,” Shea Coulson is a Vancouver lawyer who specializes in liquor regulation and policy, and constitutional litigation.
“By agreeing to hear R. v. Comeau, the Supreme Court has decided it is of national importance despite the paltry fine (of) only $292.50,” he says. “It is an enormous deal for the wine industry in Canada. It is a once in a generation case on a section of the constitution (121) that no judge now on the bench has dealt with before.”
Of the possible outcomes, either of the extremes - the status quo or blowing up the present system - are unlikely, Coulson says. Allowing free shipment of wine across Canada could be an attractive option for the judges. Both conservative and bold, it allows smaller wineries to grow into a mature industry by increasing revenues, making investments in quality and providing economic benefits to the province.
To give the principles put forward by the small BC wineries group more force before the Court, the group has drafted a “Petition on behalf of Small Wineries in Support of Direct to Consumer Shipping.” Applying to wineries with production of under 50,000 cases, it has garnered an impressive 127 signatures to date.
“A significant number of wineries aligned with one voice is far more persuasive,” Coulson says. To sign on while there is still time, go to: https://www.ipetitions.com/petition/petition-on-behalf-of-the-coalition-of-small.