BC LCLB Warns on Internet Marketing
- Details
- Written by Mark Hicken Mark Hicken
- Category: Retail and Distribution Laws Retail and Distribution Laws
- Published: 05 December 2011 05 December 2011
Wineries and other licensees should be aware that the BC LCLB issued a statement on internet marketing in the October 2011 issue of their “Liquor Line” newsletter which is available on the LCLB website here. The statement warns licensees that the sale or advertising of any liquor product without a license is not legal in BC. It then continues by saying “[t]herefore companies like Groupon or ethicalDeal.com cannot legally include liquor as part of a promotion. Given this, it is not permitted for licensees to enter into and offer these sorts of promotions. (emphasis added)” This wording could be interpreted as prohibiting many third-party marketing companies from including liquor as part of their marketing services or promotions when they are working with a licensee such as a winery or retailer.
The question then arises: is it legal for third party marketing companies to work with licensees at all and, if so, what can they do? It is my view that it is legal for third party marketing companies to work with licensees so long as all parties pay careful attention to structuring their relationships correctly. The issues are basically the same as those faced by the California ABC which recently issued a detailed advisory on these issues (Third Party Providers - PDF) which was created after extensive industry consultation and legal advice. It’s my opinion that the analysis in the California advisory is well done and should also be applicable to British Columbia.
I have confirmed with the BC LCLB that their statement was based on an analysis of the ‘default’ method of Groupon promotion under which the marketing company processes and is an integral part of the sale. However, there are, in fact, many other methods of structuring internet promotions (some of which may be legal and some of which may not) and the LCLB has also confirmed that “each case must be considered on its own merits”. However, the LCLB has not confirmed that they will follow the same principles as have been established in California and there may well now be confusion within the BC industry as to what is permissible and what is not (as there was in California prior to the ABC issuing its ruling). In the interim, licensees should be cautious about internet marking and should obtain legal advice if they are entering into these types of marketing arrangements.
BC Wine and Trade Agreement Trouble
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- Written by Mark Hicken Mark Hicken
- Category: Retail and Distribution Laws Retail and Distribution Laws
- Published: 16 February 2010 16 February 2010
This article discusses the current structure of the BC wine industry and Canada's various trade agreements such as NAFTA and GATT. I haven't written about this issue before because it is a tricky one for the BC industry. However, I have recently been asked many questions on these issues by various players in the industry as well as by lawyers and wine consumers. I am aware that a number of our trading partners are pursuing these issues.
The Problem: I'll explain in greater detail below but there are potentially serious trade agreement problems with the current structure of the BC wine industry because the current system provides preferential treatment for BC wine (with respect to liquor board markups and distribution) which is not provided for imported wine. Why is this a problem? It's a problem because two of Canada's most important trade agreeements, NAFTA and GATT, only allow preferential treatment in very limited circumstances. Generally, we are obliged to treat domestic wine and imported wine the same. This issue is of particular concern to me because much of the BC wine industry seems unaware of the issue and particularly unaware of the potential economic consequences of changes that may be required to comply with our trade obligations.
The Shaky Foundation of Canada's Liquor Monopolies
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- Written by Mark Hicken Mark Hicken
- Category: Retail and Distribution Laws Retail and Distribution Laws
- Published: 26 August 2009 26 August 2009
Only a wine lawyer could possibly be interested in the 80 year old prohibition era law that is known as the Importation of Intoxicating Liquors Act (or the IILA). Unfortunately, over the last few months, I have had far too many occasions to think about this archaic bit of law which is actually the foundation of Canada's antiquated liquor distribution system.
It was passed by the federal government at the end of prohibition and at the request of the provinces. The historical context is as follows. As most people know, prohibition was an utter failure both here in Canada and in the U.S. Alcohol consumption actually went up during that time and the prohibition laws simply made criminals out of otherwise law-abiding and productive citizens. The provinces were desperate for a way out of the mess and each of them eventually put forth the option of government control over liquor which they thought (correctly at the time) would appeal to enough people to constitute an acceptable middle ground.
Read more: The Shaky Foundation of Canada's Liquor Monopolies
Okanagan Water Law for Wineries
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- Written by Mark Hicken Mark Hicken
- Category: Environmental Laws Environmental Laws
- Published: 19 November 2008 19 November 2008
It's already a major issue for wineries in California. I know that faculty at UC Davis are now considering water needs and ability to survive drought as an important factor when selecting rootstocks for new vineyard plantings. Here in water-abundant Canada, this has historically not been a major concern. But an article in Wine Business Monthly Online shines a light on similar Canadian concerns in its review of the Okanagan Sustainable Water Strategy and the implications for wineries in the region. The article points out that winery use of water is a tiny percentage of overall usage and that conversion to drip irrigation is making industry use of the resource even more efficient.
The legal implications of water usage are still generally a backburner issue. However, occasionally, as the article points out, the Province can use its powers under environmental laws to cut off water supplies to users as happened for some Okanagan wineries in 2003 during a drought. In addition, water concerns can block development, whether residential or otherwise (including wineries), if the development threatens to change water usage or conservation patterns.
CA Winery Settles Host Liability Case for $3 Million
- Details
- Written by Mark Hicken Mark Hicken
- Category: Liability Issues Liability Issues
- Published: 11 December 2009 11 December 2009
I spoke about the issues surrounding "host liability" for wineries at the recent wine law conference that was held in November here in Vancouver. Those of you that were there will have heard my warnings regarding a winery's potential legal liability if an individual who has been served alcohol at the winery is in an accident later that injures either himself or another person.
While I am unaware of any B.C. wineries being in this situation recently, a news story from California illustrates the expensive consequences of a failure to live up to the applicable legal standards. In this case, the Sonoma County winery had hosted a wedding event and served numerous beers to a guest who was, in fact, under age. That guest ended up in a car accident later in the night in which his passenger was seriously injured. The passenger sued the winery, 7-Eleven (who later had sold some additional alcohol to the pair), and the driver. The eventual settlement ended up with the winery shouldering the bulk of the costs.