Category: Latest News

Terry David Mulligan\’s plan to transport wine \”illegally\” across the AB/BC border this Friday at high noon is getting a huge amount of media attention. This week, the Calgary Herald wrote this lead editorial supporting change to provincial liquor board policies on this issue: Alberta Should Allow Direct Purchases from Wineries. Hopefully, politicians at both the federal and provincial levels will pay attention to this issue and work towards quickly introducing a national personal use exemption, which was championed by Ron Cannan in the last Parliament. It seems abundantly obvious that Canadians want this change, which is a relative \”no-brainer\” in my view. In the U.S., the introduction (and success) of direct to consumer shipping has affected only 1% of the overall retail wine sales (the editorial says that it affected 1% of state revenue which is not necessarily the same). The effects in Canada would likely be similar: a tiny effect on provincial revenue but a huge boost for both consumer choice and for the wine industry.

Update: The Vancouver Sun has also picked up the editorial from the Calgary Herald: Law Needs Sober Second Thought

Note: While I am obviously in favour of getting the law changed … I am a lawyer and, as such, don\’t advocate anyone breaking the law.

Whatever your political leanings, the federal election results on Monday, which produced a Conservative majority government, are likely positive news for efforts to reform Canada\’s archaic wine shipping laws. The Conservative government had previously taken the position that it would reform the problematic Importation of Intoxicating Liquors Act (the 1928 law that prohibits interprovincial direct to consumer shipping) and had included a line item in the last budget to indicate that they would do so. While one of the proponents of reform did not run in the last election (Stockwell Day), the other major force (Ron Cannan) was reelected and will likely continue the effort. In the interim, this issue has been getting a great deal of media attention due to the announcement by Terry David Mulligan that he will transport wine across the Alberta/BC border on May 13th in an effort to highlight the need for reform. No doubt, there will be more to come on all of this.

A flurry of news reports this morning all challenge Canada\’s outdated wine laws and related liquor board policies.

The Globe & Mail has two articles. The first (In the Vineyard, fermenting dissent by Rita Trichur) chronicles the struggles of Ontario\’s small quality producers to get reasonable access to the monopoly controlled distribution system within their own province. This is a timely article because, while British Columbia does provide somewhat better access for its wineries, it highlights the wineries\’ discontent with a provincial government that appears to prefer using short term subsidies to support its wine industry rather than providing a better long term solution through a restructuring of the LCBO controlled distribution system. The second Globe article is by Tony Wilson (Hand liquor sales to small business). It describes the waste of taxpayer dollars that occurs when liquor boards implement minimum product pricing under the guise of controlling social behaviour. I have commented on this short-sighted policy before: all it does is provide suppliers with windfall profits at the expense of consumers. It\’s an easy way for bureaucrats to increase liquor board revenue but it is not intelligent policy. Both these stories raise the broader issue: why are Canada\’s provincial governments still wasting taxpayer dollars on government liquor retail when they are scrambling to fund health care and education? Liquor retail is simply not a core government service. Canadian taxpayers, and wine consumers, should be be concerned about this ongoing issue.

CTV also has a report on Terry David Mulligan\’s previously announced quest to challenge Canada\’s outdated interprovincial shipping restrictions: Outlaw Terry David Mulligan Plans Illegal Road Trip. Apparently, the convoy of \”illegal\” wine shipment is now planned for May 13th (that\’s a Friday … is TDM tempting fate?). Terry\’s plans were also reported in this Vancouver Province news story: Mulligan set to take \’wine bullies\’ to task.

Terry David Mulligan has gone on the record saying that he is willing to risk jail in a bid to reform Canada\’s archaic and outdated wine shipping laws. In this article from Business in Vancouver (Terry Mulligan Willing to go to Jail to Fight Liquor Law), he states that he is planning to have video footage taken of him going to Alberta, buying wine, and bringing it back to BC (which is currently illegal). He then plans to inform the liquor board and ask them to charge him.

TDM\’s plan is also covered in this Globe & Mail story which provides additional explanation regarding the wine shipping problem: Wine Makers See Red over Prohibition-era Law.

The Washington state legislature has approved some minor reforms to its wine laws which will permit wineries to offer tasting samples at farmers\’ markets and for restaurants to waive corkage fees in certain circumstances. The changes also make a consumer friendly change on filling beer jugs. The details are in this Seattle Times editorial: Legislature deserves a toast for new beer and wine laws. Meanwhile, here in BC, the pace of change seems to be glacial. The trade practices reforms (including tied house reform) that started out promisingly about a year ago, are still not effective. And we can only dream about corkage and more sensible tasting policies.

If you are interested in the retail side of the liquor business in BC, you may want to read this intriguing new analysis of the economics of BC\’s current government control system: British Columbia\’s Alcohol Control System: Are Government Liquor Stores Redundant? (PDF file – 325KB) This paper by two economics students at UBC argues that privatization of BC\’s current system would generate a $10.8 billion increase in net present value for BC taxpayers, equivalent to a $1 billion annual annuity. The authors argue that privatization would increase government revenue and general social welfare. Interesting food for thought!

At today\’s Canadian Wine Summit at the Vancouver Playhouse International Wine Festival, wine industry leaders called for reform of Canada\’s inter-provincial wine shipping laws. Participants agreed that the Importation of Intoxicating Liquors Act (from 1928) is \”embarrassing\” to all Canadians and should be changed. While the scope of reform was a contentious issue, all speakers at the session agreed that the law is outdated and needs to be changed. Check out the twitter hashtag #canwinesummit for additional comments. Update (2011-04-05): the discussions at the summit have now been reported in a great article by Peter Mitham in Wines & Vines: Canada\’s Wine Industry Wants a Vote.

At a briefing held last week in Vancouver, negotiators for the Canadian government and for the EU confirmed that the wine trade is one of the significant issues still to be resolved as part of the talks leading to a Canada/EU free trade agreement. The current timeline for an agreement is the end of this year. As I have written here previously, BC and Canada\’s current wine distribution and pricing system likely violates our current international trade obligations and needs to be fixed: BC Wine and Trade Agreement Trouble. This is an issue of significant interest to myself … and should also be one of concern for the industry as a whole. BC\’s current wine distribution system is long overdue for an overhaul. A concerted effort to modernize the system could also include measures which would effect a resolution of the longstanding trade problems.

This week\’s issue of Business in Vancouver has a good story on BC\’s outdated restrictions that prohibit corkage for wine in restaurants: Clark premiership could bring liquor reform (subscription required). Both of BC\’s neighbouring jurisdictions (AB & WA) permit corkage, as well as Oregon and California.

BC\’s new Premier, Christy Clark, was sworn in today along with her new cabinet. The BC liquor and wine industry has a new minister in charge of the LCLB and LDB: Shirley Bond, who has previously served in transportation, health and education. Bond is also vice-chair of the Treasury Board (Kevin Falcon, the Minister of Finance and Deputy Premier, is the chair).