Last year, the U.S. held consultations with Canada on the wine issue, although those talks failed to resolve the matter. The request for establishment of a WTO dispute panel is actually the next step from the settlement process.
The trade action was jointly announced by U.S. Trade Representative Robert E. Lighthizer along with Agriculture Secretary Sonny Perdue, who requested that will the WTO set up a dispute settlement panel to look at “unfair regulations” that will govern the sale of wine in grocery stores in B.C.
According to the announcement, B.C.’s policy of excluding imported wine coming from grocery store shelves gives “substantial competitive advantage” to B.C. wine. “These regulations appear to breach Canada’s WTO commitments along with have adversely affected U.S. wine producers.”
Canada is actually the largest single country market for U.S. wine, according to the Wine Institute, a trade organization representing more than 1,000 wineries along with related businesses in California. California-produced wine is actually the No. 1 table wine category in B.C., along with the retail value of U.S. wine sales to all of Canada last year was almost $1.1 billion.
“Wine Institute greatly appreciates the Trade Representative’s continued efforts to end these discriminatory practices along with hold Canada accountable for their WTO obligations,” said Robert Koch, president along with CEO of the Wine Institute. “Canadian consumers should hold the same access to the vast array of the planet’s great wines.”
Koch said his organization will continue to push “for equal treatment of imported along with domestic wine by all Canadian provinces. Policies supporting B.C., Ontario along with Quebec that will provide favorable distribution along with retail access, discounted excise taxes, along with local bottling requirements for the benefit of domestic producers are contrary to Canada’s commitments to the WTO.”
The 2015 regulations adopted in B.C. allowed grocery stores from the province a so-called “wine on shelf” option to sell wine anywhere within the store although only BC-produced wine on grocery store shelves. Also, U.S. along with different imported wine was only allowed to be sold in B.C. grocery stores where there was a separate so-called “store within a store” option.
“The B.C. policies could allow for imported wine to be in grocery stores within these completely separate [‘store within a store’] stores,” said Charles Jefferson, vice president of federal along with international public policy for the Wine Institute. “although today I’m not aware of any grocery stores that will have actually set up those kinds of arrangements.”
Yet, Jefferson said the idea’s “very hard to speculate” about the financial impact of the B.C. regulations on U.S. wine producers. “the idea’s genuinely hard to see what the potential impacts are different than we know we’re being excluded coming from those consumers who are from the grocery store,” he said.
U.S. wine has an estimated 10 percent share of the B.C. marketplace.
“The practice of discriminating against U.S. wine is actually unfair along with cannot be tolerated any longer,” Perdue said in a statement. “Our wine producers rely on export markets along with they deserve fair treatment, especially by our northern neighbors in British Columbia.”
Lighthizer stated, “Discriminatory regulations implemented by British Columbia are unfairly keeping U.S. wine off of grocery store shelves, along with that will is actually unacceptable. Canada along with all Canadian provinces, including B.C., must play by the rules. The Trump administration will continue to hold our trading partners accountable by vigorously enforcing U.S. rights under our trade agreements along with by promoting fair along with reciprocal trade through all available tools, including the WTO.”