Bill 157 2015

An Act to amend the Liquor Control Act and the Liquor Licence Act

Her Majesty, by and with the advice and consent of the Legislative Assembly of the Province of Ontario, enacts as follows:

Liquor Control Act

   1.  (1)  Section 1 of the Liquor Control Act is amended by adding the following definition:

"microdistiller" means a manufacturer of spirits that is a microdistiller for the purposes of section 22.1 of the Liquor Licence Act; ("microdistillateur")

   (2)  The Act is amended by adding the following section:

Limit on mark-up on sale of spirits

   3.0.1  (1)  Despite anything in subsection 3 (1) or the regulations made under this Act, the Board shall not set a mark-up on the sale of any class or type of spirits manufactured by microdistillers, whether at a government store or otherwise, that exceeds the mark-up that is equal to the tax that applies to beer manufactured by a beer manufacturer that is a microbrewer under section 22 of the Alcohol and Gaming Regulation and Public Protection Act, 1996.

No liability to pay

   (2)  A microdistiller is not liable to pay any portion of a mark-up on the sale of spirits, whether at a government store or otherwise, that the Board sets in contravention of subsection (1).

Liquor Licence Act

   2.  (1)  The Liquor Licence Act is amended by adding the following section:

Authority to hold any or all licences

   5.0.1  Despite any provision in this or any other Act, or a regulation made under this or any other Act, a person is permitted to hold any or all licences under this Act that relate to the manufacture, sale or delivery of spirits, beer or Ontario wine, subject to any requirements as may be prescribed.

   (2)  The Act is amended by adding the following sections:

Special rules re Microdistillers

Microdistiller

   22.1  (1)  For the purposes of this section and sections 22.2 and 22.3, a manufacturer of spirits is a microdistiller for a calendar year if all of the following circumstances exist:

    1.  The manufacturer holds a licence to sell its spirits to the Liquor Control Board of Ontario under section 22.

    2.  The manufacturer's worldwide production of spirits was not more than 625,000 litres in the preceding production year or, if this is the first production year in which it manufactures spirits, its worldwide production of spirits is expected to be not more than 625,000 litres.

    3.  In the preceding production year, the manufacturer was not a party to any agreement or other arrangement pursuant to which any other manufacturer of spirits who is not a microdistiller agreed to manufacture spirits for it.

    4.  In the preceding production year, the manufacturer was not a party to any agreement or other arrangement pursuant to which it agreed to manufacture spirits for any other manufacturer of spirits who was not a microdistiller.  However, the manufacturer may have been a party to an agreement or other arrangement pursuant to which it agreed to manufacture spirits for another manufacturer of spirits who would have been a microdistiller in the calendar year if paragraph 3 did not apply to that other manufacturer of spirits.

    5.  Every affiliate that the manufacturer had that manufactured spirits in the preceding production year was a microdistiller.

Application of Alcohol and Gaming Regulation and Public Protection Act, 1996

   (2)  Subsections 17 (5) and (6) and 22 (3.1) and (4) of the Alcohol and Gaming Regulation and Public Protection Act, 1996 apply, with necessary modifications, for the purposes of determining whether a manufacturer of spirits is a microdistiller.

List of microdistillers

   (3)  The Minister shall compile annually and make available to the public for each calendar year a list containing the names of manufacturers of spirits that are microdistillers for the calendar year and the names of the brands of spirits they manufacture.

Definition

   (4)  In this section,

"production year" means, in relation to a calendar year, the 12-month period that ends on the last day of October immediately before the beginning of the calendar year.

Sale and delivery of spirits

   22.2  (1)  A microdistiller may sell and deliver its spirits to a person who holds a licence to sell liquor or a permit issued under this Act.

Same

   (2)  Subsection (1) applies despite any restriction imposed under this or any other Act or under any agreement entered into under this or any other Act.

Manufacturer's licence to sell spirits onsite

   22.3  (1)  Despite subsection 6 (4), a microdistiller who holds a manufacturer's licence to sell spirits to the Liquor Control Board of Ontario may obtain a licence that permits the sale of spirits manufactured by the microdistiller in accordance with this section.

Requirements of licence

   (2)  A licence may be issued under subsection (1) if all of the following circumstances exist:

    1.  The licence applies only to areas under the sole control of the manufacturer that are located on or immediately adjacent to a manufacturing site of the manufacturer.

    2.  The sale is primarily aimed at promoting the manufacturer's product and either providing an enhanced tourist experience or fulfilling an educational purpose.

    3.  The council of the municipality, if any, has passed a resolution in support of the issuance of the licence.

Conditions of licence

   (3)  The following are conditions of a licence issued under this section that the licence holder must comply with:

    1.  The spirits are served only in quantities equal to or less than 43 ml (1.5 oz.).

    2.  The spirits are sold and served no earlier than 11 a.m. and no later than 9 p.m. on any day.

Regulations

   (4)  If, under the regulations, a holder of a manufacturer's licence to sell beer or wine to the Liquor Control Board of Ontario is permitted to obtain a licence similar to a licence issued under this section, any restrictions or exemptions that apply to such a licence under the regulations also apply to a licence issued under this section.

Definition

   (5)  In this section,

"manufacturing site" means property that is used by a manufacturer primarily for the distillation and production of spirits.

Commencement and Short Title

Commencement

   3.  This Act comes into force six months after the day it receives Royal Assent.

Short title

   4.  The short title of this Act is the Microdistillers Act, 2015.

 

EXPLANATORY NOTE

The Bill amends the Liquor Control Act and the Liquor Licence Act.

Liquor Control Act

The Liquor Control Act is amended by adding a new definition of "microdistiller".  (section 1 of the Act)

The Act is also amended to provide that the Liquor Control Board of Ontario shall not set a mark-up on the sale of spirits manufactured by microdistillers that exceeds the mark-up that is equal to the tax that applies to microbrewers under the Alcohol and Gaming Regulation and Public Protection Act, 1996.  (new section 3.0.1 of the Act)

Liquor Licence Act

The Liquor Licence Act is amended in the following ways:

A person is permitted to hold any or all licences under the Act that relate to the manufacture, sale or delivery of spirits, beer or Ontario wine, subject to any prescribed requirements. (new section 5.0.1 of the Act)

A manufacturer of spirits is a microdistiller if, among other things, it holds a licence to sell liquor to the Liquor Control Board of Ontario and produces no more than 625,000 litres of spirits annually. (new section 22.1 of the Act)

Microdistillers are permitted to sell and deliver their spirits to persons who hold a licence or permit to sell liquor issued under the Act.  (new section 22.2 of the Act)

Currently, regulations under the Act permit certain manufacturers of beer and Ontario wine to obtain a licence to sell their beer and wine by the glass.  The Act is amended to permit manufacturers of spirits who are microdistillers to sell their spirits by the glass.  (new section 22.3 of the Act)