WineLaw.ca

BC Wine Law Conference 2013

The 2013 of the annual BC wine law conference is coming up on Monday, February 25th, at the beginning of a week which is otherwise devoted to the Vancouver International Wine Festival. If you are interested in BC wine or liquor law issues, please join us at the conference. Here are just a few of the exciting highlights:

• Update on the current state of the industry including agricultural policy issues.
• A report on the changes to interprovincial shipment of wine including a province by province review of applicable laws and rules.
• Overview of export/import issues including relevant international trade agreements.
• Discussion of the use of alternative business structures such as custom crush operations and urban wineries.
• Regulatory issues affecting the distribution of wine and liquor in BC including a review of the recent privatization in Washington state as well as potential improvements for BC’s system.
• Wide-ranging discussions of various operational issues including labeling, counterfeiting, on site tasting rooms, land management issues, environmental regulations and employment law. 

Here is a link for more information, including the conference agenda, location and registration. Those who work in the BC wine industry are eligible for a 50% discount on the conference fee: simply register as a "student" in the online registration process.

BC Wine & Liquor Law: Will 2013 Bring Reform?

A new year always brings the promise of change. In BC, perhaps 2013 will finally bring the advent of consumer-focussed reform of our archaic liquor and wine laws. It is now 92 years since BC repealed prohibition ... and we are still stuck with a "government control" mentality for both the regulation and distribution aspects of our wine industry. The current government has made some welcome minor changes in the past year (e.g. the introduction of corkage and the acceptance of interprovincial wine shipments). However, most of the major problems remain (see the FreetheWine and ModernizeWine sites) and, as such, BC remains out of step with the rest of the world. Our outdated approach creates problems for the entire province because it stifles the growth of food/wine culture and inhibits job creation in our increasingly important hospitality and tourism industries.

I am hopeful that liquor law reform will become an election issue this year ... because it is long past time for BC to enter the modern age of liquor regulation. The past year saw increased media attention to liquor law issues. Whether it was arcane festival beer garden restrictions, liquor in movie theatres, interprovincial wine shipments, the shutting down of charity wine auctions or, most recently, the restriction of all age events, BC citizens are getting increasingly annoyed by an outdated approach to liquor regulation which is firmly rooted about 80 years in the past (see Liquor Law Year in Review, Open The Tap, and Liquor Laws Should Treat Us Like Adults). Most North American jurisdictions have modernized their liquor regulatory systems to a much greater degree than BC. Close to home, both Alberta and Washington state now have systems which are essentially modern. Even Ontario is now discussing modernization in the wake of a realization that the LCBO is not the economic golden goose that it pretends to be (see this Globe and Mail commentary: Four Reasons Why Ontario Will Be Better Off Without the LCBO). 

In BC, we have an election in May and hopefully, any new government will adopt a more modern approach on the regulatory side. In addition, and with relevance to the distribution side of the equation, the government's fiscal situation continues to deteriorate.  The next government will need to look for ways to increase revenue. Currently, the BCLDB provides about $900 million of alcohol revenue annually to the government. However, it costs almost $300 million to run the system. Our wacky and insanely complicated wholesale pricing system means that there is no room for government to increase prices. If any future government wants to wring more revenue from alcohol sales it will have to redesign the system or cut costs or do both.

There are plenty of opportunities for sensible reform of the existing system and I remain cautiously optimistic that the election may become a catalyst for change. British Columbia's wine drinkers deserve a government that promotes food and wine culture and that encourages the growth of economic activity in the hospitality sector. I'll post again later this week with some suggestions for meaningful change.

If you are interested to hear more about this topic, be sure to attend the 2013 Wine and Liquor Law Conference in Vancouver on February 25th. There will be a conference topic dedicated to the discussion of positive reform measures.

PEI Frees Grapes - Opens to DTC Wine Shipments

Prince Edward Island has acted to free the grapes (at least partly) by quietly amending its Liquor Control Act (s.33) to allow PEI residents to possess up up to 9 litres of wine per person that has been imported from other provinces. PEI's liquor board (PEILCC) says that this only applies to "in person" transport of wine, not direct shipment. PEILCC and I disagree on this point because the law uses the word "import" and, in my view, the use of the word "import" can only be reasonably interpreted to include both "in person" transport and direct to consumer shipments. The language used applies to all wine, not just domestic ... and there is no restriction to winery purchases so retail purchases would also be okay. On the down side, the section is poorly worded because it creates a cumulative personal exemption ... PEI residents are only allowed to possess up to 9 litres of wine that has been imported at any given time (in other words, if you already have 1 case, you will have to drink it before you can order another one) ... a restriction which is both impractical and unenforceable. 

For a complete review of provincial law on wine shipment within Canada, see this page: Shipping Laws on Wine within Canada.

Ontario Wine Store Privatization in the News

Modernization of Ontario's wine distribution and regulatory system has hit the news today as Ontario PC leader, Tim Hudak, has come out publicly in favour of at least some degree of privatization (see: PC Leader Hudak Urges Sale of Alcohol in Ontario Grocery, Convenience Stores). In addition, many Ontario wine producers are mounting a campaign to allow private wine stores within the province in order to increase their distribution and reach new markets. This campaign also received coverage in today's Globe from Beppi Crosariol: Wine Producers Lobby for Private Stores in Ontario. Beppi's article included a good analysis of the government revenue issue ... which usually pops up as soon as anyone mentions privatization. Those who believe that privatization will reduce government revenue simply do not understand the economics of liquor in Canada. For a primer, see my earlier article Canadian Liquor Economics 101 which explains why privatized or partly privatized systems make more money for government than systems with government retail. But for more recent numbers, see Beppi's article where he reinforces the point by noting that Alberta's privatized system makes more money for government than Ontario's state retail system.