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The Beer Store hits out at proposal to rethink Ontario monopoly

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The Beer Store, a retail partnership among three leading brewers to sell beer in Ontario, has said it will fight potential changes to its government contract that could further weaken its private monopoly in the province.

Ontarios finance ministry wants beer sales to open up to more grocery stores

Ontario's finance ministry wants beer sales to open up to more grocery stores

Anheuser-Busch InBev, Molson Coors and Sapporo jointly own The Beer Store, which until four years ago was the only outlet allowed to sell beer in Ontario outside of the government-run LCBO stores. A new contract in 2015 extended The Beer Store's license until 2025 but also allowed a small number of grocery retailers to sell alcohol including beer.

Last week, the Ontario finance ministry said it wants to cancel the existing contract - called the Master Framework Agreement - with no damages paid and implement a new system that would further open up beer sales.

In a statement, The Beer Store president Ted Moroz said the company would "fight this legislation vigorously through the courts".

Moroz added: "The government cannot extinguish our right to damages as outlined in the Master Framework Agreement. It is critical to understand that The Beer Store has, in good faith, based on a legally-negotiated ten-year operating agreement with the province of Ontario, invested more than US$100m to modernise its stores and to continue to upgrade the consumer experience."

A-B InBev, which operates in Canada under the Labatt name, told just-drinks: "Negotiations are continuing in good faith between the Beer Store and the province. Labatt is not in a position to speak on behalf of the Beer Store as negotiations are ongoing."

A Molson Coors spokesperson referred just-drinks to Moroz's comments. Sapporo, which operates in Canada as Sleeman, did not immediately respond for comment.

Ontario's minister of finance, Vic Fedeli, last week called the province's existing contract with The Beer Store "unfair", arguing that it "puts the interests of three large global brewers ahead of Ontario consumers, taxpayers and small businesses".

"It's a bad deal for people in Ontario who want more choice and convenience, and it's deeply unfair to businesses who want to compete in this sector," Fedeli added.

Fedeli wants to expand alcohol sales to corner, big-box and more grocery stores.

The Beer Store is 98%-owned by A-B InBev and Molson Coors, with 2% owned by Sapporo. It accounts for about 80% of Ontario beer sales.

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Sectors: Beer & cider

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