All imported beverage alcohol sold in British Columbia must be registered with the Liquor Distribution Branch (LDB) and represented by an agent licensed by the Liquor Control and Licensing Branch who holds a valid letter of authorization from the manufacturer.
Prior to 2017 British Columbia manufacturers of beer, wine and spirits were required to obtain a separate agent licence to market their products within the province, or retain a licensed third-party agent. This is no longer the case; under the new Liquor Control and Licensing Act manufacturers can now solicit and take orders for their own products without additional licensing requirements. However, some manufacturers continue to retain the services of a third-party agent (e.g. smaller breweries or distilleries in remote regions who require representation in Vancouver. Others may simply prefer to rely on the expertise and industry connections of existing agents rather than employing their own sales and marketing team).
The role of liquor agent in British Columbia is somewhat unusual: agents cannot directly sell to the public or import products. Only the Liquor Distribution Branch is permitted to commercially import alcohol in British Columbia, and only licensed establishments and retail stores can sell alcohol directly to the public.
Liquor agents have exclusive rights to promote and market their products throughout British Columbia and in doing so are permitted to take wholesale orders for liquor and request and that LDB import products on their behalf. The LDB describes this process as agents facilitating the movement of products from manufacturer to customer via a “promotional strategy.”
Promotional strategies include conducting product tastings and information sessions, purchasing advertisements, sponsoring events, and distributing branded promotional items.
An import agent may (and many do) represent a variety of brands and products, and hire employees as “marketing representatives”. The licensee is responsible to ensure that its staff follow British Columbia’s liquor laws and the terms and conditions of the agent licence.
The LDB along with the Liquor Control and Licensing Branch are responsible for supplying and managing the beverage alcohol industry in British Columbia.
The Liquor Distribution Act gives the LDB the sole right to purchase beverage alcohol for resale within British Columbia and from suppliers and manufacturers outside the province, in accordance with the federal Importation of Intoxicating Liquors Act. Section 3 provides that:
…no person shall import… or cause to be imported… any intoxicating liquor… except such as has been purchased by or on behalf of… Her Majesty…
As the sole buyer and re-seller of liquor in the province’s mixed public-private model, the LDB is one of the largest purchasers of beverage alcohol in the world. Every year, the LDB buys alcohol from more than 1,000 Canadian and international suppliers and manufacturers, supplying product to hospitality and retail customers across the province.
Once the alcohol is imported to British Columbia it will be stored at the LDB warehouse or a bonded warehouse until it is distributed to bars, restaurants and retailers.
In addition to the terms and conditions of licence, and the applicable statutes and regulations, the role of the liquor agent in British Columbia’s hospitality and retail sector is largely governed by contract, and a series of forms provided by the LDB.
Liquor agents have contracts with the manufacturers that they represent (who may be located in BC, other parts of Canada, or anywhere in the world), and also contracts with the LDB and others that set out the terms of how the products they represent will be imported, paid for, stored and distributed.
The following agreements and forms must be completed before a liquor agent can conduct business:
Liquor Warehouse Agreement
Supplier Authorization Agreement
Product Registration Form
Interested in becoming a liquor agent or importing liquor into British Columbia? Need assistance navigating the licensing process, or incorporating your firm? Contact Dan Coles at Owen Bird for assistance obtaining an agent licence.
*Alcohol & Advocacy publishes articles for information purposes only. They are not a substitute for legal advice, and persons requiring such advice should consult legal counsel.
This past Easter long weekend I had the pleasure of visiting a handful of wineries in Naramata, speaking to their owners, and or course sampling their products. The Naramata Bench offers a truly world class wine tasting and touring experience complete with modern facilities and stunning views of Lake Okanagan. It was fitting that on April 1, 2015 (the day before I left for wine country) the Liquor Control and Licensing Branch published its Sampling & Tasting Policy Consultation bulletin. Currently in British Columbia there is no maximum volume or quantity of free samples a winery, brewery or distillery is permitted to offer on its manufacturing site. I worry that may change.
The Sampling & Tasting Policy Consultation was drafted in response to Recommendation 59 contained in the Final Report which reads “any establishment that sells liquor should be able to provide samples in a socially responsible manner”. That makes sense. Unfortunately under the Terms and Conditions of the different categories of liquor licence in British Columbia the sample size restrictions vary between licence class. For example a food primary licensee (think restaurant) can provide larger wine samples to customers than a wine store can. That would probably come as surprise to most British Columbians.
As it stands British Columbia has the most restrictive product sampling restrictions in the country. The Liquor Control and Licensing Branch restricts not only the size of any individual product sample but also the maximum total volume of samples a consumer can be offered. This requires an employee or liquor agent conducting a product tasting to “measure out fractional liquor quantities to meet the required volumes” when offering for sample a variety of different liquors. It is not like this in other provinces.
This strict quantitative approach to product sampling stands in stark contrast to the relaxed and pro-business approach taken by the governments of Ontario and Nova Scotia for example, where consumer tastings are limited to a “small part or quantity intended to show what the whole is like” (Ontario) or “1/2 the regular serving size or less” (Nova Scotia). These latter more generous guidelines adopted in other provinces demonstrate that liquor samples can be offered safely and professionally without resorting to the use of a graduated cylinder.
In drafting the Sampling & Tasting Policy Consultation the British Columbia government has expressly recognized that product tastings are a legitimate form of liquor promotion, but that reform needs to be balanced with principles of public safety and fair competition. The Liquor Control and Licensing Branch must ensure that changes to how liquor samples are provided to the public will continue to ensure that product tastings are not used inappropriately as “inducements” to create unfair competition, and that the risks of serving minors, drinking and driving and related health concerns are mitigated.
Respectfully, Alcohol & Advocacy is of the view that the government should take this opportunity to revisit how consumer tastings are regulated in British Columbia to ensure that the new Terms and Conditions imposed on licensees are not detrimental to the development of wine, beer and spirit production as a key aspect of the tourism and agricultural industry in British Columbia.
All licensees in British Columbia are responsible for knowing and complying with the rules set out in the Liquor Control and Licensing Act, the Regulation as well as the terms of their licence. This includes liquor agents.
There are three kinds of liquor agents in British Columbia:
Though agents and their employees may not sell liquor products directly, they may solicit and receive orders for manufacturer’s products from licensed establishments and endorsed stores. Agents are also permitted to hire employees to market and promote products, conduct tastings, and take orders.
While a liquor agent may not necessarily have an “establishment” that can be inspected, liquor inspectors can nevertheless “inspect” a liquor agent by calling or visiting them to discuss the Act and ensure that the agent’s practices are in compliance with the Regulation and the applicable terms of license.
The Branch may also require production of a liquor agent’s account books and records to ensure that the agent’s accounting practices are in line with the Act.