How fixing Canada’s liquor laws could double the size of the Canadian wine industry

Help us fix Canada’s antiquated wine laws at winecampaign.ca

Two out of every three bottles of wine consumed in the United States come from an American winery. By contrast, two out of every three bottles of wine consumed in Canada are imported from other countries.

Why the stark difference in domestic wine consumption habits? Why don’t Canadians drink more Canadian wine?

Some might suggest that this is a simple marketing problem. Much how it is in entertainment and technology, Canadian companies have a tougher time reaching an audience because they don’t have the marketing resources that American companies do. Every new wine region takes time to find its market and its champions — do Canadians simply need more time to learn more about and appreciate Canadian wine?

The problem with this theory is that there is no evidence to suggest that Canadians are any less knowledgeable about wine than their American counterparts, or that winemakers aren’t doing enough to get the word out. Canadians consume more wine per capita than Americans do, and both Old and New World wineries have had fantastic success in this country. When Canadians enter a provincially-operated liquor store, they are often presented with rows upon rows of Canadian wines. Canadians are knowledgeable, sophisticated wine drinkers, and the marketing theory does little to explain the shortfall in Canadian’s interest in domestic wine.

One could also argue that Canadian wine is suffering from a prestige problem. Might American brands have an automatic leg-up in Canada, simply because they are American? Perhaps, but there is little evidence to suggest that brands are a determining factor in the buying habits of Canadian wine drinkers.

Might it be the product itself that is turning Canadians off? Could wines from outside of Canada simply be better than Canadian wines? Here, we would once again disagree. Canada produces excellent wine. Wine critics visiting the Okanagan and the Niagara Peninsula from Europe and the United States routinely express surprise at the quality of wine they find there. If their reactions are any indication, Canadian wine is tremendously underrated.

One final possible explanation for Canada’s domestic wine problem is that wine laws in this country simply make Canadian wine inaccessible to Canadians.

As it stands today, the only way for most Canadians to buy wines made in another province is to order them through their provincial liquor board, which can be a complex, time-consuming and expensive process.

The Importation of Intoxicating Liquors Act (IILA) — a ninety-year-old piece of federal legislation signed into law during prohibition — makes it illegal for Canadians to buy wine in any other way.

This makes it illegal, for example, for someone in Ontario to order a bottle of BC wine from that winery’s website. Doing so could result in a fine, or a jail sentence of up to 12 months.

These are not policies that encourage wine exploration. If anything, they encourage people to drink within their own province — even wine from other parts of the world — but not Canadian wine.

It is highly likely that if Canada were to modernize the laws surrounding the purchasing and importation of liquor, more Canadians would start drinking wine made in this country.

Common sense, updated laws would enable Canadian winemakers to establish customer bases across Canada, and would enable Canadian wine drinkers, restaurants, and merchants to become champions of the Canadian wine.

Rather than dividing Canada’s wine industry into a regional, zero-sum game, modern regulations would open up a whole new realm of possibilities for domestic wine producers.

And unlike marketing or prestige, regulation is something we can change today, yielding immediate benefit.

It is difficult not to imagine the various ways in which such a change could benefit Canadian wine.

As mentioned previously, two out of every three Americans drink domestic wine.

If the same proportion of Canadians drank domestic wine, the size of the Canadian wine industry would have to double simply to keep up with demand.

That would mean doubling the number of wineries (from 700 to 1400), and the number of jobs directly and indirectly associated with winemaking in Canada. Such a shift could have a total economic impact of up to $6.8 billion.

Extrapolations such as these might sound optimistic, but the point here is not to predict the trajectory of the Canadian wine market. The point is that updating this country’s broken laws could change Canada from a country that actively discourages its citizens from supporting its domestic wine industry to one that encourages the purchasing of Canadian wine.

Help us fix Canada’s antiquated wine laws at winecampaign.ca