Draconian liquor rules harm B.C. economy

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      The situation brewing around East Vancouver’s Rio Theatre in recent months has reinvigorated a long-standing, contentious conversation about B.C.’s liquor laws. One couldn’t help but hear the words antiquated, arcane, and draconian with reference to the neighbourhood theatre’s licensing controversy, though a glance at the province’s liquor-control guide reveals numerous fresh changes.

      Any thought that the alcohol prohibition of the 1920s ever actually “ended” in B.C. is a misconception; it never ended so much as the legislation that originally mandated it was incrementally amended, mutating over time into something that is only moderately less prohibitive.

      But it is 2012, and the dilemma B.C. faces in terms of its liquor legislation can be distilled into one of pure economics: our province’s inflexible and outdated stance is now adversely affecting arts-and-culture-related activities, nonprofit organizations, and the kinds of small- to medium-sized businesses that would be flourishing in other provinces.

      The Rio Theatre is an example of the red-tape nightmare that binds B.C.’s liquor laws to business. In its bid to rebrand as a multipurpose venue rather than “just” a movie theatre, the Rio applied for and received a liquor-primary licence. It had enough restrictions imposed that it—and any other similarly licensed live-event theatre—was “fundamentally not allowed to show movies”, business owner Corinne Lea recently explained to the Georgia Straight.

      On April 11, the B.C. government announced that it had amended this policy, allowing movie theatres and live-event theatres to apply for a licence to serve alcohol during the screening of films. Multiplexes can obtain liquor licences and sell alcohol in adult-only auditoriums and adjacent lobbies; single-screen operators and live-event theatres can apply to sell alcohol in lobbies where minors are present, and inside auditoriums for adult-only screenings or events.

      This move by the minister responsible for liquor licensing, Rich Coleman, came two months after the British Columbia Liquor Control and Licensing Branch (LCLB) introduced Policy Directive 12-01. It amended Section 8 of the liquor regulation that affected the new live-event theatre liquor-primary licence category. This amendment specifically prohibited the mixing of film and alcohol. This policy also affected temporary special-occasion licences often employed by organizations like Women in Film and Television Vancouver, which was recently left scrambling to find a new venue after having to cancel a planned gala at the Vancity Theatre.

      After three months of a “programming mess” due to the new restrictions, Lea said she had to lay off staff, and shifts were “drastically reduced”. She estimated that the Rio took in about $5,000 per week compared with $15,000 per week before the introduction of Policy Directive 12-01.

      Coleman’s ministry did not respond to a call from the Straight by deadline on April 11 to elaborate on new rules regarding special-occasion licences (SOLs). According to the amended Policy Directive 12-01, organizations eligible for these licences “may apply to hold screening events in a licensed or unlicensed theatre or other type of venue (note that under current policy SOL licensing is generally limited to 2 days per month, unless exempted by the general manager).”

      If the event takes place in a licensed establishment, the proprietor would have to temporarily suspend its licence for the screening. The recent amendments enable the Rio and other live-event theatres to show films without getting prior approval from the bureaucrats.

      Bert Hick is a Vancouver-based liquor-licensing consultant and a former general manager of the Liquor Control and Licensing Branch. “First it was the hotels, then it was the beer parlours, now bars,” Hick told the Straight in a phone interview. “We have a strong historical trend in this province of various groups jockeying for the competitive business edge liquor licences can provide. I believe the time has come for change. These [liquor] laws are like a patchwork quilt and have been tinkered with over the years to the point of dysfunction.”

      Hick said he feels strongly that B.C.’s legislation now effectively stifles and seriously threatens some areas of our economic growth—particularly for event-oriented businesses critical to B.C.’s biggest industry, tourism, that could eventually migrate to places like Alberta.

      One example of the change that Hick referenced can be seen in Ontario, which sought reform in an effort to open up opportunities for progressive business models. In August 2011, Ontario ditched its “primary use” requirement, meaning that the focus of a licensed business no longer had to be either food or liquor.

      “In 2007, we collapsed [combined] a lot of the licences,” explained Ab Campion, a spokesperson for the Alcohol and Gaming Commission of Ontario (AGCO). “We started to look at businesses in terms of ‘risk-based’ licensing, which allows for a lot more flexibility. For us, it’s about social compliance versus enforcement: as long as a business can meet our criteria with honesty and integrity under the full force of the law, we don’t care what sort of business they’re in.”

      Risk-based licensing is an industry model based on assessing the potential risks involved with licensing a business. Factors considered include everything from the business model (bar versus movie theatre) to the venue’s location to the history of the licensee. Once risks are identified, restrictions can be imposed on the licence as required, allowing the branch to focus its resources on those businesses that are categorized as “high risk”.

      Since employing its new approach, Ontario has opened itself up to a broad range of businesses, many of which couldn’t operate under B.C.’s current legislation. “Right now, I have 30 applications for spas that want alcohol,” Campion said. “ 'Get your toenails done and have a glass of wine.' ”

      “That would be 100-percent illegal here in B.C.,” LCLB spokesperson Terry Rowsell said. “Spas and salons do enquire about including alcohol with their services, and I advise against it.” However, it’s not uncommon to be served a glass of wine during a pedicure in spas throughout the province—none of which are licensed, and are thereby beyond the jurisdiction of the LCLB. It’s up to the police to enforce that law. “It’s called bootlegging,” Rowsell said.

      (Public ire over seemingly contradictory policy is often misdirected toward the LCLB, which is tasked with the business of interpreting and enforcing B.C.’s complex, confusing system. Significant change can occur only at the provincial-government level.)

      Ontario has not eradicated all the issues associated with alcohol sales and consumption, although in the short term, reform has yielded higher compliance rates and fewer licence suspensions thanks to an increase in education and communication between the branch and licensees. “Now we can focus our energy on where the real infractions and public-safety issues are,” Campion said, “and it’s made life here [at AGCO] a lot easier, that’s for darned sure!”

      In B.C., SOLs—obtained by the private sector for a range of functions, including weddings, family reunions, customer-appreciation nights, openings, fundraisers, and galas—have been under particular scrutiny. The Rio Theatre’s Lea noted numerous restrictions imposed in February upon SOLs, which are only granted a limited number of times (24) per year. “The Rio Theatre was put in a situation where we had to choose between SOLs or obtaining a permanent licence.”

      Event promoters and many caterers are ineligible to obtain either special-occasion or permanent licences—meaning they can’t be contracted with for the purchase, distribution, and serving of alcohol at private functions in the kinds of unlicensed venues (the Museum of Anthropology, say, or Science World) favoured by clients. Rather, it is the clients—who may not live in B.C. or even in Canada—who are required to obtain the necessary licence to “host” the event, making them legally responsible for every aspect of liquor service.

      Joanne Burns Millar is the president of Pacific Destination Services, an event-planning company that targets multinational corporate clients who look at B.C. as an exotic locale in which to host elite conferences and programs. Their groups can range in size from 100 to 2,000 guests, each event potentially pumping millions of tourism dollars into the provincial economy.

      “We can no longer offer a level of service expected of a ‘world class’ city, and it’s embarrassing,” Burns Millar said. “The clients don’t care whether they’re sipping Champagne on a gondola in B.C. or Alberta—they just want a unique experience and will go where it’s easy. These [liquor-licensing] restrictions are hurting businesses, and it is imperative that the tourism sector of B.C. is easily able to provide the most unique and interesting of experiences to these clients.”

      When it comes to competing with Alberta, she said, “that could be the tipping point”.

      In 2011, Burns Millar had several clients affected, one of which was a “financial institution” that opted not to hold an event at the Whistler Sliding Centre (used for the 2010 Winter Olympics) because people “didn’t have the time to go through the arduous task of obtaining an SOL”. Instead, they held their event at “another, comparatively mundane location, and a $500-per-person event became a $250-per-person event”. Clients are willing to spend money on memorable experiences, but they are not interested in the extra time and complicated steps it takes to host and manage them in B.C. “To them, time is more valuable,” Burns Millar said.

      Another Canadian client looking to hold a concert for 500 people at a Whistler Olympic venue in 2013 decided to relocate to a licensed establishment for a simpler, conventional event, Burns Millar said. The SOL hassle prompted her client to “play it safe”, the budget slashed “by about $200,000”. Associated production, rental, and venue costs from the larger event disappeared, having an impact on the entire community. “The company would have spent the money,” she said. “That money wasn’t going into [just] my jeans. It is the local production and audio-visual companies, caterers, linen and prop crews, designers, banquet servers—anyone servicing events that stand to gain when we are able to host the kinds of functions these people are willing to pay for. In order for a catering company to deliver their services, including alcohol, all those things have to be in play.”

      Debra Lykkemark, whose Vancouver catering company Culinary Capers employs 80 people, has lobbied for B.C. liquor reform modelled on an amendment recently adopted by Alberta’s Liquor and Gaming Commission. Aimed at businesses like hers, Alberta’s so-called Class D licence is a comprehensive special-event liquor licence for off-site catering companies. “I deliver food, I deliver people, I deliver everything—but for some reason, the government won’t allow us to deliver alcohol,” Lykkemark said.

      During the Olympics, the provincial government temporarily amended policy, easing the logistical restrictions that Lykkemark said are still hurting her business two years later. “They had to do it, otherwise Vancouver and Whistler couldn’t have functioned as successfully as they did,” she said.

      Lykkemark, Hick, and Burns Millar endorse an amendment like Alberta’s and have lobbied for legislative change. “It’s a very clean, simple fix,” Lykkemark said. “It levels the playing field.”

      Creative enterprises are now cropping up in Ontario, and AGCO spokesperson Lisa Murray noted in a phone interview how abandoning the primary-use requirement there has increased the licensing of low-risk, dynamic businesses that are all but impossible to even consider in B.C. “It has allowed for more flexibility in businesses,” Murray said. “For instance, a grocery store’s café and their cooking school can now be licensed. We have 16,500 licence holders in Ontario—three percent of those comprise a risk.”

      Anita Adams’s nonprofit First Weekend Club, which promotes Canadian films to domestic audiences, has been holding licensed screenings across the country for years but was prohibited from doing so in B.C. prior to the changes announced on April 11.

      Adams points out what many British Columbians see as unfair. “I find the liquor laws in B.C. to be archaic and, frankly, ridiculous,” she told the Straight before the government’s most recent announcement. “To be able to sip a glass of wine while enjoying a film should not be an issue, particularly in light of how lenient, in comparison, liquor laws are at all-ages sporting events [in B.C.].”

      The same holds true for art galleries prohibited from obtaining SOLs for events (such as exhibit launches) to promote and sustain their businesses. “Selling $5 glasses of wine or beer may net $500 once every two weeks,” said Downtown Eastside developer-entrepreneur David Duprey, who owns the Rickshaw Theatre on East Hastings Street and rents other nearby spaces to small galleries and artists. “It’s not a lot of money, but it is critical to the survival of a small, independent gallery. In other cities, it’s how it works.

      “But not here.”

      The overwhelming majority of B.C. licensees are law-abiding, and though public safety is an important issue, so, too, is the economic angle. It is important to strike a healthy balance between the two in order to promote economic, social, and cultural viability.

      At a time when government continues to slash public funding and independent businesses are struggling, responsible and proactive reform should be undertaken to modernize outdated and imbalanced legislation born of a bygone era. The changes announced on April 11 are a step in the right direction, but they don’t address all of the key issues.




      Apr 12, 2012 at 1:18pm

      it's legal to take your kids to a hockey game and drink beer, in the presence of minors, in a mob of 20,000 drunk aggressive jocks, but it's illegal to have a drink while watching a film or having your nails manicured.

      a society that supports true growth would organize in the exact reverse fashion.

      this law is not only archaic, it is slanted in favour of big business, namely the Vancouver Canucks. it has gone so far that ticket purchasers are just there for the enormity of the party and have no personal involvement in sports of any kind.

      reference the riots last year... if any one of those kids had played on a sports team in their whole life, they would know a thing or two about good sportsmanship and losing gracefully.

      you take the alcohol out of that equation, and your arenas will be as empty as a Monday morning minor league practice, patronized by true devotees to the craft.

      you add alcohol to the cinema, and you've got a house full of intellectuals animatedly discussing black comedy and gothic fiction.

      Steven Walker

      Apr 12, 2012 at 8:32pm

      BC should be consistent in its sale and distribution model for alcohol. If it is going to follow a model of government control, then it should do so consistently. If it is going to control the sale of the substance, then there should only be government liquor stores. If it is going open up distribution, then it should COMPLETELY open it up. Alcohol should be available for sale wherever and whenever adults want it, and the market alone should determine prices. Where I am currently living, alcohol is available for sale at any supermarket, convenience store or mom and pop eatery. 7-11 even has its own brand of beer. It's clear BC is only using liquor distribution as a cash cow.


      Apr 12, 2012 at 8:40pm

      Beer at Hockey "games", yet no beer at theatres. Figures.

      John Clerides

      Apr 12, 2012 at 10:17pm

      This is just the tip of the iceberg. I have been in the business of 25 years and the sheer lunacy of our rules is beyond baffling. I know the rules cost my business tens of thousands of dollars if not hundreds of thousands in lost sales, if these opportunities were allowed I woudl of course have to hire extra staff thus creating jobs. I emailed LCLB and asked what the difference was between the Rio and taking my son to a Guns & Roses concert, which I did, where beer is served and the light are dimmed. Here is the response I received

      Hi John. The difference is that generally in a stadium or arena the events take place when there is sufficient lighting to ascertain what is going on in the venue, and there are multiple staff present within the venue as well that are able to monitor what is occurring. Movies are shown in theatres that are darkened, and there is no staff present either in or overseeing what occurs within the theatre itself. The other three provinces that permit licensing of movie theatre auditoriums also have age restrictions.


      Apr 12, 2012 at 11:17pm

      Well said, violet9ish...

      Having a glass of wine at the cinema is something that should be allowed in any civilized society. Besides, do we want to support small businesses or not? Let the theatres serve wine and beer for cryin' out loud!


      Apr 12, 2012 at 11:51pm

      Great article:

      Making blanket decisions in regards to alcohol without analyzing or considering different levels of risk is an approach which is unbelievably backwards and illogical.

      Provincial authorities invariably have used the mantra of "Public Safety" (initially citing this for the Rio too). Really though...why can't we trade in wine at a farmer's market or sip champagne on a gondola?


      Apr 13, 2012 at 1:42am

      When is the last time you heard of a drunken riot after a film screening?

      Gentleman Jack

      Apr 13, 2012 at 6:41am

      "why can't we trade in wine at a farmer's market or sip champagne on a gondola?"

      Because you are a slave, and slaves can only do what massa allows them to do.
      Sorry you had to find out this way.


      Apr 15, 2012 at 4:27pm

      John Clerides: So what the reply you got from LCLB is essentially saying is that liquor did not play a part in the NHL riot? Either that, or the " multiple staff present" at the arena did not do their job...........?