2014 - Year of BC Liquor Law Reform

The new year in BC has rolled in with the promise of significant modernization to the province's liquor laws. The liquor policy review concluded on November 25th of last year with a written report by John Yap, MLA which was submitted to the responsible minister, the Hon. Suzanne Anton. The report contains 70 recommendations. To date, the government has unveiled 20 of the 70 recommendations, and has indicated that it will support and implement those 20. The first batch of 12 were announced in earlier December and were aimed at assisting the BC wine industry as well as craft beer and spirits producers: see First BC Liquor Policy Review Changes Help Local Wineries. Later in December, another batch of 8 recommendations were announced which will help the province's restaurants and bars including the return of "happy hour", easier licensing processes, permitting children into pubs with adults during certain hours, allowing restaurants to transition to liquor primary service at certain times, and expanding the Serving It Right program: see BC Toasts Happy Hours, Hospitality, Legion Changes. I understand that support for further changes will be announced in the coming weeks and that the full liquor policy review report is scheduled to be released in mid-February.

If you are interested in learning more about these changes and the opportunities that may arise from them, you may wish to attend the annual Wine and Liquor Law in BC Conference which will be held in Vancouver on February 24th. This year's conference will be focussed entirely on the liquor policy review recommendations. A discount of more than 50% on the conference fee is available for those working in the wine and liquor industry. 

First BC Liquor Policy Review Changes Help Local Wineries

The BC Government has announced support for the first batch of recommendations proposed by the BC Liquor Policy Review. The initial 12 recommendations, which government indicates that they will proceed with, include a number of positive changes that will benefit the local wine industry (as well as local beer and spirits producers). The full press release and backgrounder are here: Liquor Changes Plant Seed for Tourism and Economic Growth. Here is a summary of the changes:

  • Numerous initiatives to promote locally produced products including working with the LDB, with tourism associations and out of province groups.
  • Elimination of the requirements to obtain license endorsements for low risk tasting activities such as picnic areas.
  • Relaxation of licensing so that wineries can offer products that were not produced on-site, including working with the Agricultural Land Commission to ensure that their rules also permit this.
  • Relax licensing requirements for wineries, breweries and distilleries.
  • Allow BC wine (and other liquor products) to be sampled and sold at farmers' markets.
  • Make it easier for consumers to purchase wine (and other alcohol) at festivals and tasting events including allowing both government and private retailers to operate temporary stores at such events.
  • Allow secondary tasting rooms for manufacturers (e.g. off-site tasting rooms away from the winery as in Walla Walla or Woodinville). For example and depending upon how it is implemented, this could permit a BC winery (or group of wineries) to open a tasting room and sales outlet in Whistler or other locations close to major markets.
  • Relax licensing requirements for tourist destinations.  
All of the above are welcome positive changes. There are a further 58 recommendations from the Liquor Policy Review which will be publicly released "early next year".

BC Liquor Policy Review Report Due Today

Today is the big day for liquor policy modernization in British Columbia. Parliamentary Secretary, John Yap, was tasked with responsibility for running the review and for preparing a report which has been delivered to the responsible Minister, Suzanne Anton, today. The report will be made public, apparently "early in the new year". The Minister and Cabinet will then consider the recommendations and implement some or all of them in the spring session of the legislature. The latest news on this is that the report will recommend a limited form of liquor sales in supermarkets, see this press release: Grocery Store Liquor Sales Recommended for BC. There are 70 recommendations in the report according to the press release.

BC Reforms Charity Wine Auction Rules

The BC government has announced that new rules regarding charity wine auctions are effective as of today. The new rules will permit the auction of privately donated wine, in smaller quantities without a permit and in larger quantities with a permit. The press release is here: Charities Benefit from New Liquor Auction Rules. These changes should assist with resolving the problems for charities that resulted from an earlier change in policy by the Liquor Control & Licensing Branch (see: BC Charity Wine Auction Update and BC to Permit Charity Wine Auctions, Problems Remain). 

The new rules are brought into effect by Order-in-Council 507, effective November 22nd. Essentially, a new vendor category for alcohol is created under the Act for charitable auctions. A charitable auction which does not exceed certain amounts of alcohol (6 litres of spirits; 18 litres of wine; 51.2 litres of beer/cider/coolers) can proceed without a permit. Auctions for larger than the specified amounts will require a new permit which is available on application from the Licensing Branch for $50.

Auctions can be held by specified non-profit organizations or by charities, but in either case the auction proceeds must be used for charitable purposes (which means that fundraisers for the benefit of some non-profits and for political purposes are not allowed). An organization cannot hold an auction within 30 days of the last auction. There are reporting requirements and various other restrictions including not allowing consumption of auctioned liquor at the event.

The new regulations do not actually refer to private wine donations and it is not entirely clear on first reading how they are permitted for an auction. However, I have confirmed with the LCLB that they are permitted because the organization holding the auction is not a licensee under the Act (rather they are a permit holder, if required). The regulations indicate that the only restriction on sourcing auction liquor is that the product be commercially produced (i.e. not u-brew or u-vin product). The other restrictions related to alcohol sourcing in the Act and Regs do not apply because they apply to licensees. As as result, the holder of an auction can sell any product from any source including private donations so long as the product is commercially produced.

A policy directive is available here: Liquor Auctions and Private Re-sale of Liquor to LDB

EU-Canada Trade Deal Unlikely to Affect BC Wine Industry

As has been widely reported in the mainstream media, Canada and the EU have reached agreement in principle for a free trade deal known as the Comprehensive Economic & Trade Agreement (more commonly referred to as CETA). Various stories have speculated on the effects of CETA upon the Canadian wine industry. It is not possible to comment with certainty upon any effects until such time as the actual text of the agreement is publicly available. However, it has become apparent from briefing notes, that it is unlikely that CETA will have any significant effect upon the BC wine industry. As has been previously reported, CETA does away with all tariffs on wine between Canada and the EU (in both directions). In practice and for the Canadian market, this means the removal of a very small (and basically insignificant) tariff that is currently applied to European wines entering Canada. It also requires some changes to the way that the LCBO (Ontario's liquor board) applies "cost of service" fees to wine sold in that province. However, it preserves the existing exclusive distribution channels for domestic wine in certain private retail stores (in BC, these are the VQA stores) and it preserves the ability of wineries to sell from their own tasting rooms (direct delivery). As a result, there appear to be very few effects on the BC wine industry. CETA may, in fact, provide benefits to BC wineries that use European products in their manufacturing processes as any Canadian tariffs on those products will be removed.