Ford Government passes legislation to terminate the Beer Store contract

The Ford Government has passed legislation to terminate the Master Framework Agreement and absolve the government from damages for breaking the contract.

In 2015, the Ontario Government entered into an agreement with the Beer Store to establish a new framework agreement for the sale of beer in Ontario until 2026.

The Master Framework Agreement, fully accessible online, outlines an agreement made between the three major brewing corporations (Labatt, Molson, and Sleeman), the Beer Store, and the Province of Ontario.

The agreement states that the province would ensure that beer is not authorized for sale or distribution in Ontario except for by the Beer Store, the LCBO, stores operated by either, breweries, or duty-free stores.

If the agreement is breached, the document states that a remedy would be required, an option of which is payment of a monetary award by the breaching party.

“It’s surprising how many people in the province of Ontario do not know that the Beer Store is not owned by the government,” Finance Minister Victor Fideli said at Thursday’s reading for the legislation.

The LCBO is owned by the government. We, the people, own the LCBO and that beautiful brand. But the Beer Store is not owned by the government. I’ve been here eight years. When I was first elected here, I did not know that,” he said.

See also

• LCBO to open 150 'Convenience Outlets' across Ontario this year
• Ford to break Beer Store contract today despite potential $1B penalties
• The Beer Store 'pursuing legal options' against Ontario government

A statement from Charlie Angelakos, chair of the board of the Beer Store, reads that over the last three months, the Beer Store, brewers, and the Government of Ontario have been attempting to negotiate amendments to the agreement in order to address the government’s objectives.

The statement voices the organizations deep concern about the impact on the rapid changes that beer sales are seeing on its “7,000 employees, the thousands more who work for its suppliers, Ontario consumers who will pay higher beer prices, and for communities who rely on The Beer Store to sell beer responsibly and keep almost two billion alcohol containers out of landfill sites each year.”

While the act has been passed by the Ontario legislature, it is not yet law.

“The Beer Store believes in the sanctity of legal agreements. Businesses must be able to rely on the enforceability of legal contracts they enter into, including and particularly with governments,” Angelakos said.

“If a negotiated amendment is not reached and the Government of Ontario decides to proclaim the Act into law, the Beer Store will vigorously enforce its rights to remedies, including damages, when the government breaches its legal obligations.”