GD/232

Canada - Discriminatory Practices of Provincial Liquor Boards Affecting Beer Imports

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Other titles

Canada - Provincial Liquor Boards (US) II

Parties

Complainant
United States
Respondent
Canada
Third Parties
Australia
EEC
EEC-12

Products at Issue

Products at issue
Beer
Type of product
Agricultural
Product sub-type
Alcoholic beverages

Related disputes

GATT
Related GD
GD/147
WTO

Key legal aspects

Legal basis
  • GATT Article XXIII:1
  • GATT Article XXIII:2
Claims raised
  • GATT (no specific provision)
Defences raised
  • n.a.

Adjudicators

Type Panel
Chairperson Ephraim F. Haran (Israel)
Other members Jorge Vigano (Argentina), Elvezio Contestabile (Switzerland)

Report

Type Panel
Legal basis at issue
  • GATT Article XXIII:1
  • GATT Article XXIII:2
Claims at issue
  • GATT Article II:4
  • GATT Article III:2
  • GATT Article III:4
  • GATT Article X
  • GATT Article XI:1
  • GATT Article XXIV:12
Defences at issue
  • n.a.
No of Pages (total / legal reasoning) 71
  • -
  • -
  • Inconsistency found
  • No inconsistency found
  • Inconsistency found
  • No inconsistency found
  • Inconsistency found
  • Inconsistency found
  • -

Timeline

Request for consultations
Request for establishment
Establishment
Composition
Report
Adoption of report

Outcome

Outcome of the proceedings
Report adopted
Additional Info DS17/R (16/10/1991) Canada – Import, Distribution and Sale of Certain Alcoholic Drinks by Provincial Marketing Agencies – Report of the Panel (para. 1.4 "The composition of the Panel is the same as that of a GATT Panel which, in 1988, examined a complaint by the EEC relating to some of the practices of Canadian provincial marketing agencies of alcoholic beverages ("liquor boards") [Canada - Import, Distribution and Sale of Alcoholic Drinks by Provincial Marketing Authorities, Panel Report of 14/10/1987, document L/6307 of 05/02/1988]."): The Panel concluded that:

(a) the United States had not substantiated its claim that Canada maintained listing and delisting practices in its provinces, other than the province of Ontario, inconsistently with Article XI:1 of the General Agreement;

(b) the requirement imposed by Canada in the province of Ontario that imported beer be sold in the six-pack size, while in certain stores no such requirement was imposed on domestic beer, was inconsistent with Article III:4 of the General Agreement ;

(c) the restrictions maintained by Canada in all provinces except Prince Edward Island and Saskatchewan on access of imported beer to points of sale available to domestic beer were inconsistent with Article III:4 or XI:1 of the General Agreement ;

(d) the restrictions on the private delivery of imported beer maintained by Canada in the provinces of Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland, Nova Scotia, Ontario and Quebec were inconsistent with Article III:4 of the General Agreement;

(e) the differential mark-ups, including differential mark-ups based on cost-of-service charges, levied by Canada in all provinces with the exception of the province of Prince Edward Island, were inconsistent with Article II:4 of the General Agreement;

(f) the methods of assessing mark-ups and taxes on imported beer applied by Canada were not inconsistent with Article III:2 of the General Agreement;

(g) the minimum prices for beer maintained by Canada in the provinces of British Colombia, New Brunswick, Newfoundland and Ontario were inconsistent with Article III:4 of the General Agreement to the extent that they were fixed in relation to the prices at which domestic beer was supplied;

(h) the taxes on beer containers maintained by Canada in the provinces of Manitoba, Nova Scotia and Ontario were not inconsistent with Article III:2 of the General Agreement;

(i) the notification procedures for new practices followed by Canada in the provinces of British Columbia and Ontario were not inconsistent with Article X of the General Agreement. The Panel further concluded that Canada's failure to make serious, persistent and convincing efforts to ensure observance of the provisions of the General Agreement by the liquor boards in respect of the restrictions on access of imported beer to points of sale and in respect of the differential mark-ups, in spite of the finding of the contracting parties in 1988 that these restrictions and mark-ups were inconsistent with the General Agreement, constituted a violation of Canada's obligations under Article XXIV:12 and consequently a prima facie nullification or impairment of benefits accruing to the United States under the General Agreement.

The Panel recommended that the contracting parties request Canada:

(a) in respect of access to points of sale and differential mark-ups, to take such further reasonable measures as may be available to it to ensure observance of the provisions of the General Agreement by the liquor boards in its provinces;

(b) in respect of the other measures found to be inconsistent with the General Agreement, to take such reasonable measures as may be available to it to ensure observance of the provisions of the General Agreement by the liquor boards in its provinces;

(c) to report to the contracting parties on the measures taken in respect of access to points of sale and differential mark-ups before the end of March 1992 and in respect of the other matters before the end of July 1992.