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Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Thursday May 30, 2019

Ontario to end Beer Store deal, paving way for beer in corner stores

The Progressive Conservative government has tabled legislation that would terminate a contract with The Beer Store.

The previous Liberal government signed a 10-year deal with the brewers that permitted an expansion of beer and wine sales to hundreds of grocery stores.

Premier Doug Ford has indicated he plans to put beer and wine in corner stores, but he has to break that agreement to do so and the industry has warned that could trigger steep financial penalties.

While tabling today’s bill, Finance Minister Vic Fedeli said the current system is a monopoly that is a bad deal for consumers and businesses.

The legislation comes after the province’s special adviser on alcohol delivered a report Friday to Fedeli on ways to improve consumer choice and convenience.

The Tories also announced a number of loosened alcohol restrictions in last month’s budget, including allowing alcohol to be served at 9 a.m., seven days a week, letting people consume booze in parks, and legalizing tailgating parties near sports events.

Meanwhile, there’s been a swift reaction from Labatt Brewing Company Limited and Molson Canada 2005 — two of the three large brewers who predominantly own The Beer Store — to the legislation tabled Monday.

CBC Toronto obtained a copy of a lawyers’ letter from Labatt  and Molson putting the government on notice of a potential legal challenge to the beer legislation. Blake, Cassels and Graydon LLP represent Labatt, while Molson is represented by Gowling WLG.

In the letter, the lawyers note that the 2015 Master Framework Agreement was negotiated with the province to enhance customer convenience, choice and shopping experience, while ensuring that customers in Ontario can purchase beer at prices below the Canadian average, and to enhance the beer retailing system for all brewers selling beer in Ontario.

“The Bill will destroy those benefits, legislate 7,000 Ontario-based The Beer Store employees out of work and cause billions of dollars in damages … and result in higher costs and prices for consumers,” the lawyers wrote. (CBC)