Canada: Supreme Court’s failure to ‘free the beer’ and allow unrestricted alcohol trade across provinces is ’embarrassing,’ expert says

 

Source: thestar.com

By Kieran Leavitt

April 22, 2018

 

A Halifax professor says the Supreme Court ruling against a man who tried to carry alcohol across provincial lines is detrimental to provinces like Nova Scotia.

 

Sylvain Charlebois, Dean of Management and professor at Dalhousie University, specializes in food distribution and policy. He was hoping the court would rule in favour of Gerard Comeau because of the potential effect he said it could have had on Canadian entrepreneurs.

 

In 2012, Comeau was fined $292.50 for carrying 344 bottles of beer and some bottles of liquor that he bought in Quebec to New Brunswick. Last week, the fine was ruled constitutional.

 

The unanimous ruling against Comeau means the status quo will remain in place for provinces setting trade barriers, Charlebois said during a recent interview.

 

Supply management – controls on the production and sale of poultry, dairy, and eggs – quotas, and trade barriers will continue to limit growth for smaller businesses in less populated provinces such as Nova Scotia and Saskatchewan, he said.

 

“You need to go back to the drawing board and reconfigure supply management and other policies that don’t really make much sense in 2018,” Charlebois said.

 

Quotas in provinces are partly based on food production and population. Then they’re set by marketing boards, explained Charlebois.

 

Those quotas benefit provinces with large populations like Ontario and Quebec, but in smaller provinces like Nova Scotia, they limit entrepreneurs with companies selling products like wine or seaweed.

 

Getting those products from province to province becomes expensive, Charlebois said.

 

“You’ve got great entrepreneurial spirit in Nova Scotia but what’s missing is support for scalable models in business.”

 

Charlebois said he travels to Ontario often, where he meets people who would love to be drinking wine from Nova Scotia, but due to trade barriers, can’t get it.

 

“Maybe I do want to drink more B.C. wine in Nova Scotia and I wouldn’t mind seeing B.C. folks drinking Nova Scotia wine,” he added.

 

If the Supreme Court had ruled in favour of Comeau and against the provinces, Charlebois said it would have sent many sectors into a panic because provinces would have to rethink quotas, trade barriers, and taxes.

 

“Over the last 90 years, provinces have used a myriad of trade barriers to protect their own little jurisdiction,” he said, and added that the sectors would need time to adjust.

 

Changing it would take years, said Charlebois, and it would be a complicated process.

 

But with the legal cannabis industry on the country’s horizon, a different ruling could have made Nova Scotia look at their legislation around cannabis with a more liberal lens, Charlebois said.

 

West of Ontario, provinces have acknowledged that the private sector being involved in the sale of cannabis is a good thing, he said.

 

In Nova Scotia, the government has taken a more conservative approach where the private sector won’t play any role at all – but Charlebois said a ruling in favour of Comeau could have changed that.

 

“It would have forced, I think, Nova Scotia to rethink its bill that just got passed,” he said of the Cannabis Control Act.

 

If small businesses weren’t hamstrung by trade barriers, the provincial government would have to reconsider letting private companies sell cannabis products, because the cannabis market across Canada might be much more competitive, Charlebois explained.

 

He also said the ruling is embarrassing, just as the Liberal National Convention takes place in Halifax after the federal government has travelled the world securing international business deals.

 

“While in our own country it’s a mess,” he said. “That’s the paradox that makes the whole thing embarrassing.”