The major public policy issues relating to wine sold in Ontario are firstly whether the quasi monopoly on sales enjoyed by the LCBO should be relaxed; secondly whether the current Ontario ban on inter-provincial wine sales should be lifted; and thirdly whether part or all of the LCBO’s operations should be privatized.
There has been some modest progress on the first point. Since October 2016, wines have been available at a number of large supermarkets in Ontario however many conditions and restrictions still apply so the processes involved may be prohibitively expensive for smaller Ontario producers.
As regards the second point, currently, only BC, Manitoba and Nova Scotia allow inter-provincial shipments however this may eventually change as a result of a court case ruling on April 29, 2016. The case arose because retiree Gerald Comeau decided to fight a $292 ticket he had received as a result of bringing beer, which was purchased in Quebec, into New Brunswick. Needless to say the New Brunswick government appealed the ruling as it would result in a severe dent to their revenues. As a result of the far reaching implications of the decision relative to inter-provincial trade, the supreme court agreed to hear the case and it was heard in December 2017. Mr Comeau was assisted by the Canadian Constitution Federation. Refer to their press release for more details and their website if you wish to contribute to Mr Comeau’s defence costs. A decision is anticipated in four to six months.
Also, as a sidebar to a meeting of the premiers in July 2016 on inter-provincial trade, British Columbia, Ontario and Quebec have agreed to work together to ensure wines produced in each of their provinces can be bought online through their respective liquor control boards but there was no consideration of allowing people to buy directly from a wine producer and this looks unlikely to change.
As regards the third point, there have been numerous discussions over the years about whether the province should sell or privatize the LCBO. It has been argued that the government could actually earn more money by dismantling the high-margin retail stores while keeping the lucrative wholesale business just as Alberta did.
In 2005, a review of the province’s liquor distribution methods was conducted. The report indicated that the potential benefits of privatization were greater consumer convenience and choice via a competitive retail environment; a reduction in government held investment risk; and an increase in annual revenues. However the Liberal government of the day rejected the report and nothing much has happened since. The decision to allow the sale of wines in some grocery stores in October 2016 will reduce the value of the LCBO retail stores to an outside buyer so privatization is very unlikely at this point.
Note that WineLaw.Ca are a terrific resource on regulatory developments in the Canadian wine world.
Read the articles below to explore these issues further:
October 28, 2016 Ministry of Finance, Ontario – Locations of Wine in Grocery Stores
August 5, 2016 CTV – Ontario winery wins fight to tell people its location
April 29, 2016 WineLaw – NB case strikes down inter-provincial restrictions
February 23, 2016 Toronto Star – Wine plan isn’t a big deal just a major change
February 18, 2016 National Post – Ontario uncorks wine (and cider) sales in grocery stores
February 17, 2016 WineLaw – Canada’s Granholme revolution
August 20, 2014 WineLaw – Ontario report calls for end to liquor monopoly
June 09, 2014 Free My Grapes – Inter-provincial wine woes not over
August 02, 2013 Blog- Inter-provincial trade in wine should be free
July 24, 2013 CBC – Wine trade within Canada still being blocked