In August of 2015 Gerard Comeau of Tracadie, New Brunswick, was the defendant in a trial following an agreed statement of facts. In October of 2012 Comeau bought 14 cases of beer in Quebec which he brought into New Brunswick where he was stopped by the police. Comeau was charged under the New Brunswick Liquor Control Act with illegally importing beer into New Brunswick. The beer was cheaper in Quebec than in New Brunswick. Comeau was fined $292.
At trial Comeau argued that the limitations in the New Brunswick Liquor Control Act were unconstitutional because s. 121 of the Constitution Act, 1867 provides for free interprovincial trade.
Section 121 states:
“121. 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.”
Professor Peter W. Hogg in his book Constitutional Law of Canada states at page 681: “The purpose of s. 121, supplemented by a common external tariff and common citizenship, was to make Canada a common market. S. 121 certainly preclude customs duties between the provinces. The question whether it goes further and precludes non-fiscal impediments to inter provincial trade has not been definitely decided.”
At Comeau’s trial a witness, Professor Andrew Smith of the University of Liverpool (U.K.) stated “The Fathers of Confederation wanted a comprehensive economic union. They wanted unfettered trade between the provinces.”
Economic unions can be in the public interest. This is because trade creates wealth (see Adam Smith, The Wealth of Nations).
The public interest can be defined as the welfare or well-being of the general public. The public interest in economic unions consists in the higher standard of living brought about by trade. The U.S.A. is probably the most successful economic union in world history.
On August 31, 2015 Prime Minister Stephen Harper stated that laws that prohibit people from taking alcohol across provincial borders are “ridiculous.” See The Canadian Press.
At Comeau’s trial a Crown witness (Tom Bateman from St. Thomas University in Fredericton) referred to several provincial policies that limit free trade between provinces. Bateman referred to the creation of marketing boards that restrict the ability of farmers to freely sell their products. Marketing boards are cartels that fix prices and limit competition. Lack of competition affects productivity – see footnote.
Should the public interest in interprovincial free trade be restricted by the limitations imposed by provincial governments?
I submit that provincial legislation protecting the interests of farmers and the interests of the sellers of alcohol should be subordinate to the public interest in free interprovincial trade.
FOOTNOTE: Prof. S. Charlebois of the University of Guelph reports in the Globe and Mail, October 14, 2015, that 100 kilograms of milk costs $72 to produce in Canada versus $35 in the U.S.A.