Canada’s closed provincial alcohol monopolies

Beer Freedom and Free Trade: R. v. Comeau in the Supreme Court of Canada


By —— Bio and Archives February 16, 2017

Comments | Print Friendly | Subscribe | Email Us

Today, with the support of the Canadian Constitution Foundation, Gérard Comeau filed his response in the Supreme Court of Canada to the New Brunswick government’s Application for Leave to appeal his case. Mr. Comeau received national attention when provincial court Judge Ronald LeBlanc threw out a $293 fine against him and held that New Brunswick’s restrictions on possessing alcohol purchased in another province were unconstitutional.

What is the case about?

What was Mr Comeau’s offence? He had bought beer and spirits in Quebec and driven them back to his home in New Brunswick. Unbeknownst to him, his beer run had been targeted by the RCMP. As the province’s Application puts it, “the RCMP had the defendant under surveillance.” When he crossed the provincial line on his way home, they pounced. The RCMP stopped his car, detained him, seized his beer, and issued Mr Comeau a ticket for $292.50 for violating the province’s Liquor Control Act.

Imagine, an RCMP surveillance operation set up not to prevent serious crime, but to seize legally-purchased beer from a retiree trying to save a few dollars. And all to enforce a provincial liquor monopoly that violates the constitutional guarantee to the free movement of goods within Canada.

What is the Constitutional Issue?

Section 121 of the Constitution Act, 1867, provides that “all articles of the growth, produce or manufacture of any one of the provinces shall … be admitted free into each of the other provinces.”

This provision was intended to guarantee that the newly confederated country of Canada would be a single economic unit for internal trade. The Fathers of Confederation were keenly aware of the benefits of free trade and repeatedly referred to the benefits of open trade between the four provinces of their new country.

George Brown, for example, predicted that “[the] union of all provinces would break down all trade barriers between us, and throw open at once … a combined market of four million people.” And Alexander Galt, a fellow member of the Great Coalition government that secured Confederation, believed that one of “the chief benefits expected to flow from Confederation [would be] the free interchange of the products of the labour of each province.” Their vision was enshrined in Section 121.

Since 1867, the federal and provincial governments have repeatedly betrayed the Framers’ promise and violated the constitution by erecting protectionist barriers that impede the free flow of goods across Canada. New Brunswick’s limitations on possessing alcohol purchased in another province is an obvious example, and Judge LeBlanc had no trouble finding that it violated both the spirit and the letter of Section 121.

Why is the case important?

A recent study by economists Trevor Tombe and Lukas Albrecht of the University of Calgary estimated the annual benefits of free trade among the provinces at between $50 billion and $130 billion, or $7,500 per Canadian household per year. By comparison, the federal government predicts that CETA will add only $12 billion per year to our gross domestic product (GDP), or about $1,000 per household.

At a minimum, a victory in the Supreme Court should open up Canada’s closed provincial alcohol monopolies, making it possible for Quebeckers to buy wine directly from BC wineries and Nova Scotians to order craft beers from Ontario. A ruling that respects the history and purpose of Section 121 could also spell the end of provincial agricultural cartels and other non-tariff barriers to free trade.

As New Brunswick told the Supreme Court in its Application, “if [Comeau] is correct, any law that serves to operate either as a direct or indirect trade barrier (sometimes referred to as a ‘non-tariff trade barrier’) within Canada would invite an ultra vires finding by a court.”

What stage is the case at?

The New Brunswick Attorney General has brought the dispute to the Supreme Court of Canada, asking it to review that decision. Mr Comeau agrees that the case deserves the Court’s attention. The Canadian Constitution Foundation welcomes the opportunity to continue supporting Mr. Comeau in his fight for the constitutional rights of all Canadians, consumers and producers, to free trade within Canada.

 

Continued below...

Quotes:

“Free trade among the Canadian provinces would not only be a massive boost to Canada’s economy, adding tens of billions of dollars to GDP each year, it also happens to be what the Canadian Constitution requires. The Fathers of Confederation were highly attuned to contemporary debates about free trade vs. protectionism. They knew the benefits that would accrue to their new country from being a single free-trading bloc would counter American protectionist tendencies. Some things never change!”

Howard Anglin, J.D.
Executive Director,
Canadian Constitution Foundation

“Judge LeBlanc’s trial court opinion got it right. He accepted the testimony of our expert witness on the history and drafting of the Constitution Act, 1867, which was that Section 121 was intended to create a seamless economic union between the former colonies. The province’s argument amounts to saying that, because the real meaning and purposes of Section 121 has been ignored for 100 years, provinces should continue to be able to ignore it in order to defend protectionist interests. That’s ridiculous.”

Derek From, J.D.
Staff Lawyer
Canadian Constitution Foundation


Benefits:

Mr. Comeau’s Response can be found here.
A copy of New Brunswick’s Application for Leave can be found here.
Judge LeBlanc’s trial court decision can be found here
.
The Canadian Constitution Foundation (“Freedom’s Defence Team”) is a registered charity, independent and non-partisan, whose mission is to defend the constitutional freedoms of Canadians through education, communication and litigation.


Canadian Constitution Foundation -- Bio and Archives | Click to view Comments

The Canadian Constitution Foundation (CCF) is a registered charity, independent and non-partisan. We defend the constitutional rights and freedoms of Canadians in the courts of law and public opinion.


  NM.init({ widgetId: ì-i_435_zyfLuP-J29zeiwF09OAC08oA-RZ5oBNv9î, template: ìNM10î, articleSelector: ì.nmWidgetContainerArticleî });