Pressing Provinces to Liberalize Liquor Trade Laws

CFIB urges provinces to ease alcohol trade rules

Canada’s small and craft alcohol producers continue to face serious challenges when trying to sell their products across provincial borders, according to a new report by the Canadian Federation of Independent Business (CFIB). 

The report, Bottled Up: Barriers facing small business in interprovincial alcohol trade, outlines how outdated laws, unclear regulations, and excessive red tape prevent small producers from reaching broader markets—even those in neighbouring provinces. 

CFIB found that despite public support for reform and existing trade agreements, progress remains limited. These restrictions drive up costs, reduce consumer choices, and slow the growth of Canada’s local beverage industry. 

“When American liquor products were pulled from store shelves across Canada in response to U.S. tariffs, it opened space that could, and should, have been filled by Canadian producers,” said Keyli Loeppky, CFIB’s director of interprovincial affairs. “Instead, rigid interprovincial rules and excessive red tape continue to hinder small alcohol producers from expanding beyond their home provinces, leaving significant growth potential untapped.” 

Canada’s alcohol sector includes over 1,500 breweries, wineries, and distilleries, most of them small businesses. However, they still face hurdles such as inconsistent mark-up rates, high shipping costs, and complex listing systems that vary by province. 

CFIB is calling on governments to work together to implement commitments under the Canadian Free Trade Agreement (CFTA) and related Memoranda of Understanding (MOUs) by May 2026. The organization also recommends mutual recognition of provincial alcohol regulations, greater transparency, and a dedicated working group to guide trade reforms. 

“Duplicative lab testing requirements, inconsistent mark-up rates, and confusing rules all add to higher costs and fewer opportunities for Canadian entrepreneurs,” said SeoRhin Yoo, CFIB senior policy analyst for interprovincial affairs. “Allowing direct-to-consumer shipment of alcohol would be a significant step forward, but it’s only one part of the solution small brewers, distillers and vintners want to see. Businesses that want to move pallets of their products, not just bottles, still face myriad barriers that make it not worth the hassle.” 

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