Case a chance to correct the mistakes of the past.
The Supreme Court of Canada this week agreed to hear a case that could have major constitutional and economic implications. R vs. Comeau is sometimes referred to as the “New Brunswick beer case,” but it is about a lot more than just beer.
As some may recall, Gérard Comeau is a New Brunswick man who was charged under the province’s Liquor Control Act for purchasing cheap beer in Quebec and then driving across the border. The act makes it an offence to possess more than 12 pints of beer not purchased from the New Brunswick Liquor Corp.
Comeau’s lawyers argued successfully at trial that the New Brunswick legislation violates the free trade clause found at section 121 of Canada’s Constitution Act, 1867. It states 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.” The trial judge held that New Brunswick’s ban on out-of-province beer violated this free trade guarantee.
Readers may find this result unsurprising. The plain meaning of section 121 would seem to clearly prohibit one province from banning the possession of goods purchased in another province. How can goods from out of province be said to be “admitted free” if it is against the law to possess them?
In fact, despite what the constitutional text says, the Comeau trial decision was rather surprising. If upheld, it would amount to a major constitutional development.
This is because a line of previous Supreme Court cases held that the Constitution’s free trade clause doesn’t mean quite what it says. Put simply, these cases held that the clause prohibits only interprovincial tariffs. So-called “nontariff barriers,” including even outright bans on out-of-province goods, are not tariffs, and so are said to be permitted.
Recent scholarship has cast serious doubt on this restrictive interpretation of section 121. Work by Ian Blue (one of Comeau’s lawyers on the case) has shown that the broad language of section 121 was chosen by the framers for a reason. They were quite familiar with nontariff trade barriers of the kind that the United States had imposed on Canadian goods under its Reciprocity Treaty with British North American colonies, and this may have influenced the constitutional drafting process. The trial judge in Comeau accepted this evidence as part of his ruling that section 121 must be interpreted more broadly than previous courts had held.
The Comeau case comes just as the provinces and the federal government are inching toward freer interprovincial trade under the new Canada Free Trade Agreement. The political and judicial branches of government thus seem to be moving in a similar direction. Yet there are reasons to suspect that the Supreme Court might hesitate in giving full effect to Canada’s constitutional free trade clause.
For instance, some might worry that a robust interpretation of section 121could interfere unduly with provincial autonomy and local democratic decision-making on economic matters. Indeed, any instance in which one province has a different regulatory regime from another could be seen as a “nontariff barrier,” since it gives rise to increased compliance costs. Surely, section 121 doesn’t mandate regulatory uniformity across provinces. What, then, is the court to do?
There is a way to give a robust interpretation to section 121 while still respecting provincial autonomy and regulatory difference. And Canada does not need to reinvent the wheel to do this.
Both Australia and the United States are federations with constitutional guarantees of internal free trade. And courts in both countries have managed to reconcile free trade with their countries’ federal structure. They have done this by allowing for local regulatory differences while requiring that governments not discriminate against products from other jurisdictions.
A similar standard could work in Canada, and would at least put a stop to police sting operations targeting thirsty crossborder shoppers, like the one that caught Comeau. More broadly, an anti-discrimination standard would prevent provinces from enacting protectionist measures that do not involve tariffs.
Giving full effect to Canada’s constitutional free trade clause does not necessarily mean undermining our federal structure or interfering with local economic regulation. But it does require a Supreme Court willing to correct its own past mistakes.
Both Australia and the United States are federations with constitutional guarantees of internal free trade. And courts in both countries have managed to reconcile free trade with their countries’ federal structure