On Friday afternoon a New Brunswick Provincial Court judge ruled that rules prohibiting the transportation of beer (well, alcohol in general) are unconstitutional (read a news article about it here). I might not talk about this except that – potentially – the ruling could have implications for a wider range of beer-related policies.

The summary of the case is this: Gérard Comeau, a senior and (apparently) big fan of Budweiser, bought 15 cases of beer and 3 bottles of liquor in Quebec and carted them to his home in rural New Brunswick 200 km away. If that seems a long way to go to you for a bunch of Bud, you are right. However, Mr. Comeau was motivated by the significant price differential between New Brunswick and Quebec. Bringing that much beer across a provincial border is illegal and Mr. Comeau received a $292 ticket for his trouble (kinda wiped out his price savings, didn’t it?). He challenged it in court and on Friday won.

The core of the decision is s.121 of the Constitution Act of 1867, so we are not talking Charter of Rights stuff here. In fact it is a pretty obscure section of the Constitution. I had to look it up. This is what it says: “All Articles of the Growth, Produce, or Manufacture of any one of the Provinces shall, from and after the Union, be admitted free into each of the other Provinces”.

Essentially the case comes down to inter-provincial free trade. Are governments allowed to erect barriers to the free flow of goods between provinces? Until now (and I am certainly no expert on this) the section has been interpreted very loosely. The judge’s opinion is that it is much more clear cut and prohibits any kind of inter-provincial trade barrier.

In terms of the real world, this could have significant impact on a wide range of industries, including agriculture, energy and construction. Far bigger things than this little thing called beer. But beer is in the mix, so let’s discuss it.

What does it mean?

First, we have to remember this is a lower court ruling. We are basically in the first period here, folks, so lots can change. Second, the impacts of decisions like this are always more moderate than the initial reaction. I am already hearing commentary that this means the end of liquor control boards and government-owned liquor stores. Nonsense. Even if the decision holds up, it will take years and years for all this to play out.

That caveat put on the record, let’s discussion possible implications.

Assuming the decision holds – and that is a big assumption, given it is based on something of an Originalist interpretation of the Constitution (the position US Presidential candidate Ted Cruz holds, that we must interpret the constitution strictly based upon what the drafters intended, not in context of modern realities) – one consequence seems clear. Canadians will be able to buy alcohol for their personal consumption in one province and transport it to another. I also suspect wineries (and breweries!) will be permitted to sell directly to consumers in other provinces and ship the product to them without going through the liquor control board (at least in the receiving province).

Probably, but not as certain, is that liquor board’s role as gatekeepers in what enters a province will come under scrutiny. If the board tries to pick “winners and losers” by selecting which product enter the province, it seems that might fall afoul of the ruling. This outcome would be a good thing for Alberta brewers trying to get access to consumer-rich B.C. and Ontario, who currently have to jump through numerous hurdles to even get a sniff as shelf space. Alberta’s open border policies might become standard.

The court ruling is unlikely to result in this…

Moving along the less likely scale is the fate of Alberta’s differential mark-up. It is possible it could be ruled unconstitutional as it applies a higher mark-up on non-New West Partnership breweries than Alberta, B.C. and Saskatchewan breweries (read here for more on that). I am not sure if that would fall under the ruling as the province does not restrict the entry of the product and it does not, in a strict sense, tax it more (mark-ups, legally, are not taxation). However, that could be debated. I realize the mark-up policy is already in the courts, but the Steam Whistle case utilizes a different section of the constitution (I won’t get into it here) and so this ruling has no direct impact on it.

On the highly unlikely end of the spectrum are thoughts that this will bring an end to liquor control boards or publicly-owned liquor stores. Those entities, as such, have no impact on inter-provincial trade. They may be required to change policies regarding Canadian imports, but their existence is not being challenged.

So, beer fans, take a breath. Maybe, maybe, in a few years you will be permitted to buy as much B.C./Ontario/Quebec/Yukon beer as you wish and take it home with you to PEI/Saskatchewan/Alberta. And that would be a good thing. But don’t expect a radical transformation of how beer is distributed and sold in this country. The law doesn’t move that fast. If you want faster change than that, be prepared to engage in good, old fashioned political campaigning.