Lawyer Shea Coulson, representing a group of B.C. wineries, presents arguments at the Supreme Court of Canada for lifting interprovincial trade barriers. Photo courtesy the Supreme Court of Canada.

B.C. wine industry fights for interprovincial trade in Supreme Court

Gerard Comeau likely never thought he would end up in the Supreme Court of Canada when he drove into Quebec to buy some cheap beer and bring it back to his New Brunswick home.

Comeau got a $292.50 fine for violating New Brunswick’s Liquor Control Act and his Supreme Court appeal, which closed after two days of presentations Thursday, could have ramifications for interprovincial trade across the country.

Lawyer Shea Coulson described the debate as a question how Section 121 of the Canadian Constitution should be interpreted, and whether or not it should extend into the areas viewed as belonging to the provinces.

Section 121 states items created in any province should be admitted freely into each of the other provinces. However, a precedent decision, known as Gold Seal, has allowed restriction that many provinces are using to block wine, beer and other alcohol across provincial borders.

“Gold Seal says that section 121 of the constitution is limited to protecting against tariff barriers only. It does not include non-tariff barriers,” said Coulson, who represented a group of intervenors from the B.C. wine industry to the court — Curtis Krouzel (50th Parallel Estate), Ian MacDonald (Liquidity Wines), Jim D’Andrea (Noble Ridge Vineyard and Winery), Christine Coletta (Okanagan Crush Pad Winery) and John Skinner (Painted Rock Estate Winery).

Related: B.C. wine industry rallying for a fight

Sandra Oldfield, the former owner of Tinhorn Creek Vineyards in Oliver, travelled to Ottawa to observe the appeal case. Some of the conversations, she said, suggested local businesses would lose income and provinces would lose taxation revenue by freeing up interprovincial trade in spirits.

“I don’t really see where alcohol should be singled out for that. They’re already getting provincial taxes and everything on alcohol,” she said, noting that when B.C. didn’t seem to suffer when it lowered trade barriers five years ago, one of only three provinces to do so after Bill C-311 — introduced by MP Dan Albas — eliminated the federal blocks.

Coulson presented arguments that there is currently no national market for liquor in Canada, due to the current interpretation of Section 121 and Gold Seal.

“As a result small and boutique producers of Canadian wines find themselves shackled to the limits of their physical location in their province. They cannot access a national market, and thus, they cannot grow beyond a small regional industry,” said Coulson to the Supreme Court justices.

B.C. was one of three provinces that relaxed interprovincial trade barriers after Bill C-311 was passed five years ago. Oldfield said it hasn’t seemed to have hurt the B.C. wine industry, which has continued to grow.

“It’s not like we’ve had a flood of Ontario wines; if they’ve come in, in any amount, it certainly hasn’t hurt our industry,” said Oldfield. “I’ve never been a big believer that opening up the borders is going to take something away from the liquor board or the other side.

“When Canadians are exposed to more Canadian wine, they are going to drink more Canadian wines.”

Coulson and other intervenors argued that Section 121 was intended to create a national common market, balanced with appropriate protections for regional interests. That, he said, showed a need for a test to determine if provincial provisions are exclusionary, or served a real provincial need.

“It seems that most of the court recognizes that the trade barriers that do exist in Canada, particularly in relation to alcohol, are issues but some of the judges are questioning whether the court should be the one to resolve those issues, or should it be the government.

Noting that there doesn’t seem to be a problem with people having access to cheap Australian wines across the country, Oldfield said the industry’s desire isn’t to flood other provinces with B.C. wine.

“We should be able to forge a relationship with someone who walks in the winery door,” said Oldfield. “They want to be able to continue the relationship by joining our wine club and we want to be able to fulfill that order.”

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