Trade barriers prevent alcohol producers such as Ron Kubek, owner of Lightning Rock Winery in Summerland, B.C., from legally shipping the product to other parts of the country.Aaron Hemens/The Globe and Mail
Last July, after Ron Kubek’s boutique winery in Summerland, B.C., won the top award for its pinot noir in a national competition, he awoke to dozens of online orders. He promptly filled the requests, mostly from wine enthusiasts in Ontario, and shipped the bottles across the country.
Doing so technically made Mr. Kubek and his Lightning Rock Winery outlaws under the fragmented and outdated patchwork of provincial legislation and agreements covering direct-to-consumer alcohol sales in Canada.
That same month, nine provinces and one territory (later joined by Newfoundland and Labrador) committed in a memorandum of understanding to allow such sales between their jurisdictions by the end of May, 2026 – a move that would give legal cover to alcohol producers while uncorking new markets for small business owners like Mr. Kubek.
However, the signatories are set to blow through their self-imposed deadline with no comprehensive movement on DTC alcohol shipments.
On Friday, Internal Trade Minister Dominic LeBlanc signalled no implementation deal is imminent, and sought to shift the blame away from Ottawa.
“Today, I expressed my concern regarding the delays caused by a number of provinces and territories,” he said in a statement. “The federal government has done its part by removing all federal barriers to interprovincial alcohol trade.”
Opinion: No country for alcohol sales – but then Canada got lucky
Progress over the last year has been glacial. New Brunswick implemented full DTC alcohol sales shortly after signing last year’s agreement, joining Manitoba as the only provinces to allow their residents to freely buy any type of alcohol directly from other parts of the country.
Then, in March, Ontario and Nova Scotia inked a bilateral deal to free the flow of beer, wine and spirts between the two provinces.
Beyond that, the provinces offer a mishmash of rules depending on the kind of alcohol. For instance, British Columbia and Nova Scotia allow Canadian-made wine from all other provinces, but B.C. limits all spirits shipments except from Saskatchewan; Alberta allows B.C. wine only, while Saskatchewan lets in shipments of wine and spirits from B.C. only.
Going back decades, alcohol has been a very public symbol of Canada’s failure to bring down internal trade barriers, even if wine, booze and beer accounts for a relatively small share of total interprovincial trade.
Alcohol as a lever in trade talks gained an even higher profile when provinces yanked U.S.-made bottles from store shelves in response to President Donald Trump’s tariffs and threats against Canadian sovereignty.
North American-made autos must contain at least 50% U.S. content, Trump negotiators tell Mexico
That made scoring a win on DTC sales something of a litmus test for the Liberal government’s “One Canadian Economy” push.
“Direct to consumer is the bare minimum the provinces can do,” said Keyli Loeppky, senior director of Alberta and interprovincial affairs with the Canadian Federation of Independent Business, which called out the stalled talks earlier this week.
By its nature, DTC alcohol sales is a small market. It’s costly to ship wine and liquor to individuals in another province.
“But there are still people who want to do it, and there are still businesses who want to be able to ship their products across Canada for folks to try out, so it really is the least that governments can do to allow businesses to expand,” Ms. Loeppky said.
She added that Manitoba and New Brunswick have not suffered economically or financially by allowing unfettered DTC shipments. “At this point, the holdup is silly.”
Conservative MP Dan Albas and other critics accuse provincial liquor boards of thwarting direct-to-consumer shipments to maintain their control of sales and fees.Adrian Wyld/The Canadian Press
Dan Albas, a Conservative MP whose B.C. riding includes the Okanagan wine region, said Mr. LeBlanc’s statement was an admission that the federal government’s chosen route of relying on the provinces to reach DTC agreements is doomed to fail.
He and other critics accuse provincial liquor boards of thwarting DTC shipments in order to maintain their control of liquor sales and the accompanying fees.
“These liquor monopolies have long acted as gatekeepers and are stifling Canadian innovation, economic growth and consumer choice,” he said in an interview.
Mr. Albas urged the Liberal government to adopt Bill C-262, legislation he tabled in March that would sidestep the provinces and their liquor boards and allow Canada Post and other “trusted” carriers to deliver shipments directly to consumers.
“I encourage the government to stop blaming others” and either fast-track Bill C-262 or codify it in a bill of the government’s own making, he said. Mr. LeBlanc already called Mr. Albas’s proposal “a good one,” when asked about it in March.
LeBlanc open to Conservative bill to let Canada Post deliver alcohol to consumers across country
As it is, Mr. Kubek said it’s “the dirty secret” of the industry that many wineries already ship directly to consumers out of province. He sends wine either through Canada Post or ATS Healthcare, a temperature-controlled shipping company that many vineyards and wine clubs use.
If jurisdictions do strike additional DTC deals, those shipments are likely to face fees they didn’t before.
Where agreements have been reached, there’s hope it will pay off. Ahead of the summer tourist season, Nova Scotia wineries have rushed to register with the Liquor Control Board of Ontario to ship bottles to customers in that province, said Melissa Herbin, executive director of Wine Growers Nova Scotia.
Under the Ontario-Nova Scotia agreement, producers must register with the destination province’s liquor board, and submit reports on any DTC sales, along with taxes and fees on a quarterly basis. According to the LCBO website, 14 Nova Scotia wineries have been approved so far.
“When Ontario tourists come to Nova Scotia this summer and then go home and decide they really want to get that style of wine again, now they can easily do that,” said Ms. Herbin.
But even within that bilateral agreement, perplexing barriers remain. Terah McKinnon, a spokesperson for the Nova Scotia Liquor Corporation, confirmed the agency imposes a flat 5-per-cent fee on DTC shipments from Ontario, regardless of which type of beverage.
LCBO also confirmed it imposes variable markups on shipments from Nova Scotia producers ranging from 1.6 per cent on wine up to 32.5 per cent for spirits.
“Who was sitting at that table and thought that was a good deal?” said Tyler Dyck, president of the Canadian Craft Distillers Alliance, who also runs B.C.’s Okanagan Spirits Craft Distillery. “It’s such a difference in scale. That’s tariff trade, not free trade.”
Ron Kubek inspects budding pinot noir grapes in the Lightning Rock Winery vineyard on Friday.Aaron Hemens/The Globe and Mail
While DTC sales offer “huge potential” for his industry, “with this total void of information and with none of us being consulted, it’s hard to trust they’re going to knock this out of the park, let alone make it happen,” Mr. Dyck said. “You wouldn’t make a deal on Canadian steel without having steel producers there.”
Dan Paszkowski, the head of industry group Wine Growers Canada, has been fighting for DTC sales for two decades. He said he remains optimistic the provinces will come to an agreement, even if it is delayed.
But he cautioned that would not mean consumers could immediately place orders. Instead, he expects the provinces will first announce an agreement on standardizing age verifications, mechanisms for remitting fees and taxes and other administrative processes. He believes that specific bilateral agreements between each province will follow, spelling out fee levels modelled on the Ontario-Nova Scotia agreement.
Based on his discussions with provincial governments, “it appears that all the provinces have come on side and are ready to sign onto this particular harmonization agreement.”
Provinces themselves had little to say on what comes next.
When asked if Ontario was preparing to allow DTC shipments from other provinces besides Nova Scotia, or even how many Nova Scotian producers had signed on to ship alcohol to Ontario residents, Sarah Chapin, a spokesperson for Ontario Finance Minister Peter Bethlenfalvy, said in a e-mail that the province “will continue to lead the way on tearing down interprovincial trade barriers, and work with other provinces to join us.”
In a statement, the B.C. Ministry of Agriculture and Food said it is working with other provinces and territories on the issue, and that the details of a national DTC framework and any fee markups will be released when they are confirmed.
As for Mr. Kubek, he fumed at the delays and said he plans to continue shipping to Ontario, a service he openly advertises on the Lightning Rock website.
“I’d love Ontario or Quebec or someone to try and arrest me. It would be front-page news because I’m a law-abiding business that pays huge taxes and all I want to do is ship wine,” he said.
And he dismissed last year’s memorandum of understanding between the provinces as a “memorandum of uselessness.”
“If you want to do something for the Canadian people and economy, sign a proper agreement and make it happen.”