Canada, ON: Ontario introducing sales of beer, wine, and cocktails into corner stores

Ontario is introducing sales of beer, wine and ready-made cocktails into corner stores and additional supermarkets 16 months ahead of schedule, a move that will see the province pay up to C$225 million to The Beer Store, CBC reported on May 24.

Retailers, including convenience stores and gas stations, will be able to start selling the low-alcohol beverages as of Sept. 4. The process for applying for a licence from the Alcohol and Gaming Commission of Ontario (AGCO) will open on June 17, the province says.

Similarly, the 450 grocery stores provincewide that already have licences for beer and wine will be allowed to sell ready-to-drink cocktails on Aug. 1.

All other supermarkets and grocers will then be able to sell beer, wine, cider and canned spirit drinks as of Oct. 31.

The retail locations participating in the government's expansion of where alcohol will be available for purchase will be able to sell packs of beer of any size, including 30 packs. They will also be able to set their own prices, though the province has regulated minimums.

Premier Doug Ford and Finance Minister Peter Bethlenfalvy announced the impending changes at a news conference in Etobicoke on May 24.

"It was just a few months ago that we were together talking about our plan to give people more choice and more convenience when it comes to buying beer, cider, wine and other alcoholic beverages in Ontario. The response from the public, from stakeholders, from small businesses has been absolutely overwhelmingly positive," Ford said Friday.

"That's because our plan will create new growth opportunities for local brewers, wineries, retailers and small businesses. It's going to support local jobs and most importantly, it's going to give people more choice and convenience," he added.

The provincial government's strategy to "modernize" the alcohol market was first released last December, but it wasn't supposed to take effect until 2026.

That timeline was in part due to the province's Master Framework Agreement (MFA) with the multinational brewing conglomerates that own The Beer Store, which currently has a quasi-monopoly on the distribution and sale of beer in Ontario.

The MFA, a 10-year agreement signed by the previous Liberal government, gave The Beer Store exclusive rights to sell 12- and 24-packs of beer as the province expanded sales of beer and wine to grocery stores. It was set to expire in 2025.

At a technical briefing for media on May 24, Ministry of Finance officials said the $225 million from the province will help The Beer Store maintain jobs, an evolved retail footprint and offset the costs of an accelerated timeline for beer sales at more locations throughout Ontario.

Ford disputed a characterization that the money is going to the companies that jointly own The Beer Store, though the agreement specifies "the province shall reimburse TBS" for added costs up to that amount.

"We aren't giving them to the Molsons of the world and the Labatts, that they put the money in their pocket and say, 'See you later,'" Ford said.

"So that's not accurate. What we're doing, we're supporting the front-line workers at The Beer Store.... We're going to be audited every step of the way, to make sure that it's being distributed in the right fashion."

Finance Minister Peter Bethlenfalvy said the money will "help maintain perhaps unprofitable Beer Stores."

"This is going as part of the agreement to unwind that 10-year monopoly that the previous government, the Liberal government signed," he said.

"This is always about having as much of an orderly transition as possible, minimizing disruption and giving a chance to adjust to the new world."

Multiple former Ford government staffers are now lobbying for brewers, grocery stores and convenience stores.

Liberal Leader Bonnie Crombie said the announcement is evidence of the premier giving preference to insiders.

"Grocery store billionaires and multinational corporations are the only winners in this latest backroom deal," she wrote in a statement.

"When will Doug stop spending taxpayer dollars on his corporate friends and start making life more affordable for Ontarians?"

Ford denied that any lobbying was a factor in his decision to speed up the alcohol expansion.

The Beer Store is also set to remain the primary wholesale distributor of beer in the province, and run its recycling program, until 2031. Starting in 2026, any retail location that sells alcohol with more than 4,000 square feet of retail space will need to accept empties, the province says.

Meanwhile, the LCBO will continue to be the only retailer that sells high-alcohol spirits like gin and whisky, and will be the only wholesale seller of alcohol in the province. Retailers who enter the space as a result of the expansion will get an interim wholesale discount of 10 per cent from the LCBO basic retail price until 2026.

The ministry estimates there will be some 8,500 new locations where consumers can purchase low-alcohol products, giving Ontario the third-highest density of alcohol retail stores among the provinces, behind only Newfoundland and Labrador and Quebec.

Ontario will be the third jurisdiction in Canada to offer beer in corner stores and the first to sell ready-to-drink cocktails in those locations.

The AGCO will be responsible for licensing retailers, and the government says the expansion will come with stronger penalties for infractions. Retailers whose licences are revoked won't be able to reapply for two years.

The government is putting an additional C$10 million over five years to support social responsibility, but a coalition of public health and advocacy organizations have called on the province to develop a comprehensive alcohol strategy for reducing harms.

The coalition, which includes the Canadian Mental Health Association and the Canadian Cancer Society, says alcohol-related harms cost Ontario more than C$7 billion annually, and the last time access to alcohol was expanded in the province, the number of emergency department visits related to alcohol grew.

In a statement, Toronto's Centre for Addiction and Mental Health said it was disappointed the Ford government "has chosen convenience over the health and wellbeing of Ontarians."

"There are already more than 6,000 alcohol-attributable deaths a year in Ontario, and the changes announced today will significantly increase this number," the hospital said.

"The main driver of alcohol-related harm is convenience. Decades of research show that increased ease of access leads to more consumption and, in turn, more harm."

28 May, 2024