CBC Radio has A great report About what we can learn from the Supreme Court of Canada R. v. Comeaupopularly known here as the “Free the Beer” cabinet.
In 2012, Gerard Comeau loaded his car with beer (and whiskey and drink) in Quebec and went home to New Brunswick, where the drink costs more. Five years later he was at the Supreme Court. The reason is that he had reduced more beer than permitted under provincial drink laws, unintentionally running of interprovincial trade barriers.
In comparison with rates, interprovincial trade barriers may seem like a small container. But since developed countries want to diversify trade relationships, non-tariff barriers, such as those of the Canadian provinces, will loom great.
It sounds strange that Canada has interprovincial trade barriers, but it is not as dramatic as it sounds. There are no customs control points between provinces and rates between provinces are prohibited by the Canadian Constitution. Article 121 States: “All articles of growth, produce or manufacture one of the provinces are free from and after the Union in each of the other provinces.”
Rather the IMF classifies barriers To internal trade in Canada in four categories: of course (including geographical), priceless (such as alcohol sales), technical (weight and dimensions) and legal and administrative barriers (permits/licenses, safety certification).
The report states (p.4) that “labor mobility, business regulations, transport, markets for drugs, agricultural products, food and alcohol products, and until recently, government tasks are mentioned as areas that are usually affected by trade barriers.” These are all provincial responsibilities.
The decision of the Supreme Court Discovered that while Comeau had led the New Brunswick Liquor Control Act, which makes it ‘a violation to’ have a drink or keep ‘in an amount that a prescribed threshold that has been purchased from another Canadian source than the New Brunswick Liquor Corporation, “that action does not count as a ban on intervovincial trade. Instead, a constitutional provincial power (regulating and control of alcohol) has inevitable secondary effects on trade that can only be excluded by unconstitutional centralizing power.
New Brunswick only lets alcohol be brought into the province via the New Brunswick Liquor Corporation. There is a small personal exemption from this rule and Gerard Comeau had reduced more than his exemption allowed.
Because the legislation under which Comeau was charged, had to do with regulating alcohol in the province and not preventing interprovincial trade, Comeau lost.
The Supreme Court agreed that trade barriers as trade barriers Within Canada are unconstitutional. No province can impose rates or blanket bans on goods from Canada to encourage buying locally.
But the court was not willing to disturb the provincial jurisdiction. The court’s decision says that the incidental costs for interpretinial trade in provincial control over import and regulating alcohol are the costs for protecting the granted powers exclusively for provincial legislators. It is perhaps a bad idea for New Brunswick to manage alcohol selling via a monopoly, but this is a provincial decision and the province must decide to give up monopoly.
Provinces have the right to set their own safety or technical standards on the basis of their observed needs, and this prevents some goods and services from seamlessly going between provinces. They may establish rules around alcohol, nicotine and cannabis, which have the same effect. To eliminate technical and regulatory barriers, despite the wishes of the provinces, a single standard should be imposed. To eliminate priceless standards, the provinces should losing their power to strictly control goods such as alcohol, nicotine and cannabis.
Interrovincial trade barriers are not special in this. The arguments on interprovincial non-tariff trade barriers reflect international arguments about harmonizing regulations to allow or encourage trade between sovereign states that want to determine their own rules.
Regardless of the driving force behind technical, regulatory and administrative regulations – whether or not they are good regulations that are worth the economic costs – they also limit the free movement of goods and services between jurisdictions. This creates the right dynamics for Bootlegger-Baptist Coalitions That can further anchor the barriers. This is true Even if We accept that the standards are good standards that are worth the costs.
Rates have a dramatic effect, but they are easy to remove. The problems that influence interprovincial trade in Canada are Netjer. This is completely shown in the renewed dedication of prime ministers to eliminate interprovincial barriers on 1 June 2025: except in Quebec (linguistic care); exclusive food; most First ministers connect to direct-to-consumer Canadian alcohol sales. Nobody will go further to one Supply Management System (unfortunately) that has supplied stable egg prices, while the American market has been so volatile – even although it influences interprovincial trade.
Canada’s difficulty to free trade, even within its own limits, illustrates the tension between the desire for free trade and dedication to decentralization. It is not enough that the economic benefits would be considerable – although it can become sufficient if a complete trade war breaks out. All these policy measures have reasons for those who support provincial voters who have nothing to do with protectionism. There are similar problems with which all jurisdictions have to do that strive for freer trade.
Free trade means negotiating between the competing liberal values of free trade and decentralized power. Those who are committed to freer trade must keep that in mind and be clear about real considerations to free trade. We have to show why it is worth it anyway.