Injunction granted over Alberta beer markup policy

Money given back to local brewers violates law, Ontario beermakers say

An Alberta court has sided with two out-of-province breweries and granted an injunction against Alberta’s new beer markup policy.

Ontario-based Steam Whistle Brewing and Saskatchewan’s Great Western Brewing Company have both alleged the new rules announced by the Alberta government in August are unconstitutional, in that they build barriers against craft brewers from outside the province.

Under the new system, the markup rate for all beer sold in Alberta is $1.25 a litre, regardless of where it is made.

(Previously, Alberta brewers got a break on the markup rate, as did brewers in B.C. and Saskatchewan which are part of the free trade New West Partnership Agreement).

However, while all brewers now pay the same markup rate, Alberta brewers who produce less than 30 million litres per year get at least some of the money back, through a grant program exclusively targeted to brewers with brewing operations and jobs in this province.

It is that grant program that has attracted the ire of out-of-province brewers, who say they are now less competitive in the Alberta market.

“We are very pleased by the court’s judgment, as this decision will enable us to continue our efforts to encourage freedom, competition, and fairness in the marketplace,” said Great Western CEO Michael Micovcin in a statement.

“Steam Whistle took on this crusade with the intention to make beer tax policy fair and equitable in all jurisdictions across the country,” said Steam Whistle Brewing co-founder Greg Taylor in a statement.

“We applaud Saskatchewan’s leadership with its recent introduction of a new graduated craft beer tax program open to any brewer, regardless of origin.”

The Alberta government has previously said it does not believe the new markup system violates the terms of any interprovincial trade agreements since it does not restrict any brewer from selling beer in the province.

Defenders of the new system have also pointed out Alberta brewers face barriers in other provinces, where governmentcontrolled liquor stores encourage the promotion and sale of local products above others.

Finance Minister Joe Ceci declined to comment on the court proceedings Thursday, but in an emailed statement he said the government remains very proud of the jobs and opportunities the change to its beer policy is bringing to Alberta entrepreneurs.

“Alberta continues to have the most trade-compliant policy in Canada and the most open liquor market with more than 7,000 beer products currently listed,” Ceci said.

Steam Whistle took on this crusade with the intention to make beer tax policy fair and equitable in all jurisdictions …