Canadians like to talk about trade. Remember the dust-up over the Trans-Pacific Partnership agreement in the last federal campaign, or earlier passionate debates over the Canada-US Free Trade agreement and its successor, NAFTA?
There is one exception. When it comes to free trade within Canada, no one ever seems to pay much attention.
We better start. A recent New Brunswick court decision, likely to end up at the Supreme Court of Canada, has the potential to radically change our country and its economy.
Although Canadians may maintain a fierce loyalty to their province or region, I also like to think we see our nation as a place where citizens are free to travel, live and enjoy life wherever they want.
This lyrical rhetoric comes to a screeching halt, however, when it comes to doing business between provinces: Our national landscape is littered with a patchwork of laws, rules and regulations that hamper interprovincial trade. It seems so quaintly Canadian that despite our status as a single nation, provinces have erected monopoly liquor regimes that keep out competition from other parts of Canada; established different gasoline blend requirements to hamper nationwide refining; given preference to local or provincially based companies for government procurement; and, in some cases, impeded the general recognition of professional credentials. You can add to this list our nation's various agricultural marketing boards that maintain prices by curbing production and limiting competition.
The outcome: A trade regime where it is often easier for businesses to access markets outside of the country than in another province.
The cost? No one knows for sure, but most studies estimate that all these barriers cost Canadians billions of dollars every year. Not being able to buy cheaper electricity from the province next-door really starts to get expensive.
The low profile of this issue has resulted in political action occurring at a glacial pace. Despite commitments to have a new agreement on internal trade by March of this year, talks between the federal government, provinces and territories are still continuing with no firm end in sight.
Enter Gerard Comeau, a retired New Brunswick steelworker who went in search of cheap beer across the border in Quebec. Such an appalling act of bad citizenship does not go unnoticed in Canada. The RCMP immediately stopped him upon his return and fined him for transporting more alcohol across the border than allowed under the modest limit set by the New Brunswick government.
Mr. Comeau challenged the law, using Section 121 of the Canadian Constitution as his defence. This section mandates the free flow of “articles grown, produced or manufactured in one province of Canada” into all others.
Up until now, courts have interpreted this section as prohibiting only customs duties on goods coming from another province and have allowed other trade barriers to be erected. Not so, said Mr. Justice Ronald LeBlanc, the New Brunswick judge who heard the case. The judge agreed with evidence presented in the case that it was the intention of the Fathers of Confederation to create a nation with total interprovincial free trade with no barriers, financial or otherwise. Mr. Comeau was free to buy as much Quebec beer and liquor as he wished.
This case goes way beyond cheap booze. In making his ruling, Justice LeBlanc pointed out that the case had implications for the “very nature of the Canadian federation.” Although the case ultimately revolved around Comeau's actions, the judge questioned the constitutionality of “any scheme” that interferes “with the free movement of goods inter-provincially,” even those put in place to protect the citizens of that province.
Commenting on his ruling, it is not surprising that the judge said he made it “with a great deal of trepidation.” It is also not surprising that the New Brunswick government that makes substantial sums from its liquor monopoly appealed the matter to a higher provincial court with most observers believing it will end up in front of the Supreme Court.
What is surprising is how little political attention this case has garnered. Although the federal Liberals paid mild lip service to the ruling, they have refused to refer the question of whether our constitution mandates absolute interprovincial free trade to the Supreme Court in order to get immediate clarification. Instead, the federal minister in charge has pointed to the ruling's potential to encourage the interprovincial trade talks. The Ontario minister who helps chair the talks, however, indicated through a spokesperson that he feels the court ruling has nothing to do with the current negotiations.
All of us better be careful. The Supreme Court could soon issue a ruling with the potential to change the way significant parts of our economy operate. Do Canadians once again want to be surprised by a Supreme Court ruling that sends us scrambling to play catch up?
John Milloy is a former MPP and Ontario cabinet minister currently serving as the co-director of the Centre for Public Ethics and assistant professor of public ethics at Waterloo Lutheran Seminary, and the inaugural practitioner in residence in Wilfrid Laurier University's Political Science department. He is also a lecturer in the University of Waterloo's Master of Public Service Program. Milloy is the editor of, and a contributor to, Faith and Politics Matters (Novalis, 2015).