‘Infuriating’: Sask. brewery says red tape, regulations deter interprovincial expansion

Beer brewers in Canada say it's needlessly difficult to sell their products in other provinces.

Despite recent efforts to ease provincial trade restrictions, Canadian alcohol producers say there are still hurdles to jump in order to sell their products across the country.

Mark Heise, president and CEO of Rebellion Brewing, said the regulatory documents producers have to comb through can be a big deterrent when it comes to expanding interprovincially.

“It’s mind-boggling, mind-blowing and infuriating to be quite frank,” he said.

The Regina-based beer is on store shelves in Saskatchewan, Alberta and Manitoba.

Heise had to apply to sell out of province, a process he started in both Alberta and Manitoba around the same time in 2019.

“I personally did that as an experiment,” he said.

Rebellion beer was on Alberta shelves within two weeks of the application process. It took Heise another three years before his product could be sold in Manitoba.

“Manitoba consumers are very happy to support us … but it was definitely a lot of hard work,” he said.

Alberta and Saskatchewan are outliers, according to Heise, who referred to the two provinces as “open markets, where it is quite easy for producers of Canadian made products to sell their products.”

“Everywhere else, we would term that as a closed market with lots of government regulations, red tape and bureaucracy.”

Heise has considered expanding to other provinces. He’s looked into B.C.’s regulatory document.

“They’re usually about 300 to 500 pages,” he said.

“I gave up very quickly on that one, and same with Ontario as well.”

Each province and territory has its own set of rules and standards related to alcohol sales, which makes the interprovincial trade of alcohol hard to navigate, according to the Canadian Federation of Independent Business (CFIB).

A ‘confusing patchwork’

A new CFIB report says the inconsistency leads to a “confusing patchwork” of barriers that companies have to sift through in order to sell product outside their home province.

The report says labelling standards, product registration protocols, reporting obligations, variability in markup rates, and laboratory testing requirements can all vary from province to province.

As a result, the CFIB’s director of Alberta and interprovincial affairs, Keyli Loeppky, says the process ends up deterring many breweries, distilleries and wineries from expanding.

“It takes a lot of time and it’s also very costly,” Loeppky said.

“Any time that producers are focused on paperwork, labeling requirements and trying to navigate liquor board websites across the country, it’s time that they are not focused on making a product better.”

There has been progress on the trade front in recent months.

Federal, provincial and territorial governments agreed on an action plan to reduce interprovincial trade barriers on alcohol earlier this year. It includes commitments to improve consumer choice, transparency and access to markets for alcohol producers.

Trade barriers ‘absolutely absurd’

In July, most provinces also agreed to a memorandum of understanding to allow direct-to-consumer alcohol sales by May 2026. The framework would let Canadians order wine, spirits and beer directly from the out-of-province producer and have it shipped for personal consumption.

But Loeppky says the moves don’t go far or fast enough and direct-to-consumer shipping still won’t put Canadian products on shelves. The CFIB wants to see provinces use the May 2026 deadline to fulfill the action plan commitments.

“It’s absolutely absurd that, as a Canadian, you can’t purchase alcohol products that are made in your own country,” she said.

Heise is also lobbying for the removal of trade barriers, although he doesn’t think it would move the needle too far forward for the beer industry. Even with an open market, he said shipping costs are still high.

“Beer is heavy, which makes it costly to ship, especially compared to the value of the product you’re shipping,” he said. “On top of that, beer is very fragile. Real beer is unpasteurized and has a short shelf life.”

Transportation issues and a strong “support local mantra” within each province’s beer industry can make it hard for out-of-province breweries to turn a profit, Heise said.

Distilleries and wineries are likely to benefit more from easier interprovincial trade, he said. Spirits and wines have higher values, which makes the cost of shipping more economical, and the shelf life is less of an issue in transport.

“There’s a huge opportunity with removing interprovincial trade barriers to allow those industries to probably sell more product in other provinces,” Heise said.