Fact Check: Facts About Ontario's Beer Industry

TORONTO, Dec. 16, 2014 /CNW/ - Yesterday Ronald Podolny from Siskinds LLP did several interviews regarding potential litigation related to Ontario's beer industry.

Mr. Podolny made factual errors in those interviews.

On Newstalk 1010's Jim Richards Show, Podolny stated: "My understanding is that the Ontario beer, which is actually owned by foreign companies but what they term Ontario beer, is sold at the Beer Store and other types of beer are sold at LCBO." In fact, the Beer Store is open to every brewer in the world. Under the terms of a 1993 Canada-US agreement on beer marketing practices, the Beer Store is required to be open to imported beer. Today, 105 different brewers sell their beer in the Beer Store – with 25 per cent of those brewers being Ontario small brewers.

On CBC Radio Metro Morning Podolny stated: "if two competitors agree that they won't sell the same product or they will not sell in the same market, then they don't have to lower prices to compete." In fact, provincial law requires that the Beer Store and the LCBO sell product to consumers at the same price. Because of that provincial law, even if the LCBO and the Beer Store sold the same products, they would have to be sold at the same price. (Source: Section 3(1)(i) of the Liquor Control Act).

Podolny also stated on CBC: "As a restaurant owner he has to pay more because according to this alleged deal the Beer Store is only source where he can purchase beer." In fact, restaurants and bars do not have to order beer from the Beer Store – they can choose to order beer directly from any Ontario brewer with a production volume of less than 75,000 hectolitres a year. This was confirmed in a letter from the LCBO in January 1996 which says, "Current policy allows direct delivery of product to licensees by microbrewers who produce less than 75,000 hectolitres/year."

The Beer Store does not set the prices of the products sold in its system. Those prices are set independently by individual brewers in competition with other brewers and are approved by the LCBO as required under provincial law.

SOURCE: The Beer Store

Bill Walker, [email protected], 416-624-3936