August 23, 2017

Saskatchewan Applauds Trade Ruling Against Alberta Beer Mark-Up

Saskatchewan’s Acting Minister Responsible for Trade Dustin Duncan is calling a ruling against the Government of Alberta’s system of beer mark-ups a big win for free trade within Canada.

A panel set up under the Agreement on Internal Trade confirmed the Alberta government’s current rebate program for small Alberta brewers as well as the program it had in 2015 discriminated against brewers from other provinces and was contrary to that province’s free trade obligations.  The panel has given the Alberta government six months to change its policy. However, the Alberta government is appealing the decision.  The appeal process could take up to seven months.

“Our government has been a champion of eliminating trade barriers between the provinces and Alberta’s rebate program has been a de facto barrier,” Duncan said.  “By contrast, our province provides a graduated mark-up rate for small breweries, regardless of origin, and does not discriminate between Saskatchewan and out-of-province breweries when applying its mark-up.

“The panel decision supports a level playing field for beer, which is good for Alberta consumers and the Canadian craft beer industry generally.  We are disappointed Alberta has decided to appeal the ruling.  It needs to do the right thing and comply with the ruling.”

In August 2016, the Alberta government moved to one standard beer mark-up of $1.25 per litre regardless of company size, location or level of production.  However, that policy change also came with grants to small, Alberta-based producers that effectively offset the new mark-up.

Artisan Ales, a Calgary-based beer importer, successfully argued before the panel that the rebate program discriminated against the beer it brought in from other provinces and had a major negative impact on its business.  The Saskatchewan government supported Artisan Ales’ complaint as an intervener in the dispute.  Saskatoon-based Great Western Brewing was also concerned about the Alberta government’s mark-up policy and preferential rebate program for Alberta-based brewers.

“Alberta is a substantial market for our products and their policy clearly puts our business at a competitive disadvantage based solely on the fact we manufacture our products in Saskatoon and not in Edmonton or Calgary,” Great Western Brewing CEO Michael Micovcin said.  “Government-created trade barriers like this hurt business and the overall economy.”

Duncan noted that the Saskatchewan government will again vigorously defend Canadian interests in an appeal process and he is confident the original ruling will prevail.