Labatt seeks truce
May 16, 2003 - Labatt's breweries is calling for a truce in its ongoing battle with Quebec's microbreweries.
The microbreweries claim the province's big brewers, Labatt and Molson, are using their weight to push them out of business. They promised to fight on even after a federal Competition Board ruling rejected their claims.
Labatt says that the ongoing battle costs it in two ways: Defending itself in front of the competition bureau since Quebec's microbreweries filed a complaint; and in advertising dollars.
The company said wants to sit down with all of its competitors Molson and the microbreweries to discuss ways of changing the rules in Quebec that regulate beer sales so all of them can better profit.
Labatt's maintains that just as smaller grocery stores and hardware stores have been hurt by the arrival of big chain stores in Quebec, so, too, will smaller breweries be destroyed by what Labatt calls "natural market forces" if all Quebec's breweries can't work together.
After losing the Competition Board ruling, the microbreweries said they would discuss the situation with Justice Minister Martin Cauchon. "We're very disappointed with the decision because what it says in effect is that you can beat up on the little guy, but as long as he's still breathing, it's OK," Laura Urtnowski, vice-president of the Quebec association of microbrewers, said, telling a news conference: "We're going to slowly but surely get beaten down and microbreweries will be falling off and consumers' choices in beers will be restricted more and more."
The microbrewers claim that exclusivity deals cut by Molson and Labatt with Quebec bars, restaurants, and convenience stores, and other tactics, such as buying up beer display areas in stores, are squeezing them out of the market. "It's no longer a free market because there are so many restrictions," said Andre Dion, president of the association and Unibroue. "When it's a free market, you could knock on the door and offer your beer. In some places, there's no way to get in."