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editorial

Australia exported roughly $200-million worth of wine to this country last year. We are its fourth-largest market, but sales are half what they were a decade ago and winemakers Down Under would like to increase them.

According to a complaint lodged by Australia with the World Trade Organization, "discriminatory" practices in Canadian wholesale and retail wine markets are making that difficult.

Australia says provincial alcohol boards put higher prices on imported wines and subject them to measures that "potentially exclude or limit imported products from being displayed and sold," among other charges.

It's not the first complaint of its kind. The United States has lodged two WTO actions over the rules for selling wine in British Columbia.

What if the plaintiffs have a point? All countries engage in some form of trade hypocrisy, but the fact is that our cloistered system of provincial wholesale, and in most cases retail, monopolies is one of the last left standing. Almost nobody in the world does this any longer – only eight countries, in fact.

The scheme has some advantages. It's a cash cow for provincial governments, and there is research suggesting it provides public health benefits. But it's also expensive, and it hurts Canadian producers who can sell their wines around the world but not in neighbouring provinces.

Under WTO rules, Australia and Canada have 60 days to reach a negotiated settlement, so this may end up being a tempest in a champagne flute. But should the complaints process grind to its end, an adverse ruling could well put a dent in the tired edifice of Canadian booze monopolies.

There's also a chance the Supreme Court will swing the wrecking ball later this year when it rules on the case of a New Brunswick man who was prosecuted for driving beer across provincial lines but was acquitted on the grounds that provincial trade barriers are unconstitutional.

Both outcomes would be worth raising a glass to.

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