Notley vows to find a way to support craft brewers

Facing a $100-million CALGARY lawsuit over her government’s embattled beer policies, Premier Rachel Notley insisted Friday the province will still find a way to legally back Alberta craft breweries.

“It’s my job to stand up for an industry which has long needed the attention of its government,” she said during a stop in Calgary. “Overall, what we’re going to continue to do is find ways within the law to support our small brewers.”

Last week, law firm Rochon Genova LLP filed a proposed classaction case in Court of Quench’s Bench in Calgary against the province and the Alberta Gaming, Liquor and Cannabis Commission over its craft beer policies.

It’s seeking $100 million in restitution on the behalf of brewers from outside Alberta, their agents, bars, restaurants and consumers.

A statement of claim says the government’s “discriminatory and unlawful price markups” for beer have affected the sale of outof-province craft brew sold within Alberta.

Notley wouldn’t comment on the specifics of the class-action case. But she pointed out Alberta’s deregulated liquor industry is the most open in the country, and accused other provinces of blocking Alberta beer from their government-run liquor stores.

“We have the most profitable market for other provinces to sell their product into, yet you can’t find Alberta products in almost any other province,” she said.

“It’s our view that our policies have been put together in good faith to be trade compliant and we’ll continue to work to ensure they meet that standard.”

In 2015, Alberta increased the graduated markup on craft beer to a $1.25 per litre, except for brewers located in Alberta, Saskatchewan and British Columbia.

A year later, it applied the higher rate to all Canadian small brewers, but provided an offsetting grant to Alberta companies. An independent panel found Alberta’s changes contravened interprovincial trade policies contained in the Agreement on Internal Trade.

In June, Court of Queen’s Bench Justice Gillian Marriott ruled Alberta’s policies created a trade barrier and violated the Constitution’s interprovincial free-trade provisions.

The 2016 changes violate the Constitution, “in that it is intended to operate simultaneously with the grant program to discriminate between craft brewers and craft beer on the basis of provincial origin,” the judge wrote.

Marriott ordered the province to pay restitution of more than $1.9 million to Great Western Brewing of Saskatoon, and $164,000 to Steam Whistle Brewing of Toronto.

“Our main concern was the precedent that was set around the government’s imposition of those unconstitutional tariffs,” Tim McLaughlin, Steam Whistle’s director of marketing, said this week.

“We want provincial jurisdictions like the government of Alberta to support craft beer, but we’d hope they would do it in a way that doesn’t penalize out-of-province craft breweries.”

Alberta is challenging the court ruling.

It was given six months by the separate trade panel ruling this spring to change its policies, or potentially face fines.

United Conservative Party MLA Drew Barnes said the Notley government needs to become trade compliant and move away from giving subsidies to brewers.

“They’ve lost three rulings, they’ve already cost the taxpayers $2 million in legal costs and restitution. And here she is again, doubling down on a failed policy,” Barnes said Friday.

“We do not need a system of subsidies. Government picking winners and losers has never worked,” he added.