The Alberta government is opening a new front in its beer war with other provinces by targeting Ontario for what it says are its unfair trade barriers to Alberta-made suds and other alcoholic products.
The initiative emerged on Monday as Alberta announced a full retreat on its own craft beer subsidies that were found by a judge last spring to be unconstitutional.
“Alberta has the most open liquor policy in the country, offering Albertans a choice of over 3,700 Canadian products … Alberta merchants stock and sell 745 alcoholic beverages from Ontario,” said Economic Development and Trade Minister Deron Bilous at an Edmonton brewery on Monday.
“Ontario is the largest market in the country, three times larger than our own, yet we can only find about 20 Alberta liquor products listed for sale in Ontario.”
READ MORE: Alberta files notice of appeal after June ruling found it discriminated against out-of-province beer
The complaint under the Canadian Free Trade Agreement is being made against Ontario because it has the biggest liquor market in Canada but it could be expanded to include other provinces with similar barriers, Bilous said, adding he’s hoping for an amicable solution.
Under the CFTA, Ontario will have 120 days to respond to the complaint made in a letter sent Monday morning. The complaint may then proceed to a CFTA panel for a ruling on corrective actions or allowed retaliatory measures, with a provision for either side to appeal that ruling, explained Jean-Marc Prevost, Bilous’ press secretary.
The Ontario government responded to the challenge in an email to Global News.
“Just last week, I sat across from representatives from the government of Alberta and not once did they mention this to me,” Todd Smith, Ontario’s minister of Economic Development, Job Creation and Trade.
“The government of Ontario is committed to reducing interprovincial trade barriers, as we made clear in our fall economic statement when we said we wouldn’t stand in the way of pipeline projects moving forward.
“We hope Alberta will join us in our work to reduce interprovincial trade barriers and red tape.”
The Liquor Control Board of Ontario did not immediately respond to a request for comment.
In his letter to Ontario Trade Minister Todd Smith, Bilous complains that Ontario gives local brewers access to stores over Alberta brewers, gives Ontario beverages preferential shelf or refrigerated locations, requires Alberta brewers to provide commercially confidential information to their larger competitors to be listed and gives Ontario small brewers a significant discount on listing costs.
READ MORE: Notley pledges support for Alberta beer as potential $100M lawsuit looms
Neil Herbst, owner of Alley Kat Brewery of Edmonton, said he has faced numerous non-tariff barriers when trying to ship his products to Ontario, giving as an example a $400 laboratory fee assessed on a shipment of $1,600 worth of beer.
Also Monday, Alberta Finance Minister Joe Ceci said he will cancel by Dec. 15 a program of grants for small Alberta craft brewers in order to bring provincial beer regulations in compliance with Canadian trade law.
- Singh says NDP won’t trigger election over Johnston, interference. Why?
- N.S. wildfires: Some evacuations lifted in Halifax; Shelburne blaze remains out of control
- Spy watchdog’s relations with intelligence agencies ‘challenging’: memo
- New rehab contract for veterans given failing grade by union. Why?
The province will return to a system similar that was in place before 2015, with markups (a tax collected for the province) of $1.25 per litre applied to all beer sold in Alberta by producers of more than 50,000 hectolitres per year.
READ MORE: Trade panel ruling slams Alberta’s craft beer subsidy program
Smaller brewers, regardless of province of origin, will be able to apply for markups of between 10 and 60 cents per litre.
Alberta dropped its graduated markup system to go to a flat markup on all beer in 2015. It at first exempted brewers in Saskatchewan, B.C. and Alberta, then changed its rules so it applied to all Canadian brewers but introduced a subsidy program solely for Alberta’ small brewers.
It lost a CFTA panel ruling initiated by Artisan Ales, a Calgary-based beer importer, which argued the grant program unfairly tilted the market against its product.
Last June, a Court of Queen’s Bench judge ordered the province to pay a total of $2.1 million in restitution to Great Western Brewing of Saskatoon and Steam Whistle Brewing of Toronto, finding that the subsidies created a trade barrier against their products.
READ MORE: Alberta loses beer battle with Steam Whistle, Great Western breweries
At the time, Ceci said the province would consider appealing that ruling.
His department says Alberta now has 137 liquor manufacturers, including 99 brewers. It says the number of brewers has nearly tripled since the subsidy program was introduced in 2016.
The province says it will introduce more supports for Alberta liquor manufacturers in the next few weeks.
— With files from Global News