A price markup for Nova Scotia wines will be phased out over the next four years following an agreement between the governments of Canada and Australia.
Australia had filed a complaint before the World Trade Organization in 2018, accusing the Nova Scotia government of violating the deal by implementing measures leading to reduced prices for local wines compared with foreign products.
The Nova Scotia Liquor Corporation maintains its local wine initiative, called the Emerging Wine Regions Policy, is fully consistent with Canada’s international trade obligations.
But the province said today in a news release it will change course in order to end years of litigation with an important trading partner.
Nova Scotia says it will collaborate with its local wine industry as it transitions from the markup policy.
The province’s emerging wine initiative was red-flagged in a report last month by Nova Scotia’s former auditor general, Michael Pickup.
Pickup warned there had been no risk analysis of the policy before it was implemented, leaving it vulnerable to running afoul of Canada’s trade obligations.
Geoff MacLellan, Nova Scotia’s minister responsible for trade, said in a news release: “We stand by our position that the Emerging Wine Regions Policy is origin neutral and, to date, no international body has ruled against the NSLC.
“That said, Australia is an important trading partner for Canada and prolonged litigation means uncertainty for our industry.”
Nova Scotia says domestic sales revenue for local wineries was $21 million in 2019, supporting more than 500 jobs.
This report by The Canadian Press was first published July 27, 2020.
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