NS deploys policy to support the wine industry rather than risk going through the WTO

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The Nova Scotia government is phasing out a program designed to help wine producers in the province and other small areas rather than risk colliding with the World Trade Organization.The province announced Monday it has reached a deal with Australia to end the emerging wine region policy following Australia’s complaint to the World Trade Organization that the policy violated trade rules.

While the government continues to maintain trade-compliant policy, Agriculture Minister Keith Colwell said the province did not want to risk a protracted legal battle – the challenge was launched in 2018 – and most importantly, did not want to risk a protracted legal battle. ‘have the WTO rule against Nova Scotia. .

“They could have come back and said, ‘You have to implement this in six months,’” he said in a telephone interview. “Then we would have had a major problem in our hands. “

‘A very good spot overall’

An unfavorable WTO ruling could also have led some countries to stop buying wine from the province, Colwell said. He said the risk was simply too great for the industry to continue to defend the policy.

“At the end of the day, that’s not where I would like to be, that the industry would like to be or that our government would like to be, but I think, given our circumstances and the possibilities, I think we ‘ re in a very good position overall. ”

As part of the deal, Nova Scotia has four years to phase out the policy.

Under the policy, the Nova Scotia Liquor Corporation’s profit margin is only 43% on a bottle of wine, compared to 100% for companies that have exceeded the policy threshold. For a $ 10 bottle of wine, that means the difference between a retail price of $ 14.30 for areas covered by the policy and $ 20 for those that are not.

Gerard Adams, president of the Winery Association of Nova Scotia, said the policy has helped regions like Nova Scotia, Ontario and Quebec gain favor with NSLC patrons as wineries in these regions developed and developed.

Work on new support tools

Considering the size difference in the industry, he said it was puzzling that Australia took such a tough stance on politics.

“From an Australian perspective, it’s clear that they are still selling quite well in Nova Scotia, and pretty well in Nova Scotia,” Adams said. “It was a little disappointing, I guess, that they complained in the first place. ”

It is unclear what effect removing the policy will have, and Adams said it will now be up to the industry and the province to work over the next four years to find new ways to support the industry all. by staying trade compliant and helping the vineyards continue to grow. .

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