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U.S. business lobby group warns Ford about cancelling Beer Store deal

Last Updated Jun 5, 2019 at 11:18 am EDT

An image of the new upgraded Beer Store logo. Amber LeBlanc/680News.

The U.S. Chamber of Commerce is warning Premier Doug Ford about the “negative signal” dissolving the Beer Store deal sends to investors.

In a letter sent to the premier on Tuesday the lobbying group, which represents more than three-million businesses, commends the government for advancing pro-business policies. However, it expressed concern that legislation introduced to bring an end to the Beer Store monopoly will undermine all the work done to illustrate that the province is “open for business.”

The Ford government has tabled legislation to cancel the province’s 10-year agreement with the Beer Store, calling it a “sweetheart deal” the protects profits rather than provide convenience. While the government has said it will protect taxpayers against costs associated with any civil liability, it has not said how much cancelling the contact will cost the government. Some reports have indicated it could climb as high as $1 billion.

The union representing the Beer Store employees said cancelling the contract will result in the loss of “7,000 jobs and billions in taxpayer dollars” and they have promised to challenge the legislation.

“Our strong concern is that terminating an existing contract, and doing so without compensation — something we understand is proposed in the case of the ‘Bringing Choice and Fairness to the People Act’ — risks sending a negative signal to U.S. and other international investors about the business and investment climate in Ontario,” reads the letter.

“The U.S. Chamber … believes there are few factors more critical to investment and economic growth than the legal certainty and predictability fostered by the respect for the rule of law.”

The letter goes on to “strongly urge” the Ford government work with all corporate stakeholders to ensure an amenable resolution to all parties.

The Ontario Chamber of Commerce has also warned the government that ripping up the Beer Store deal could deter investment in the province. Rocco Rossi called breaking a legitimate contract a short-sighted approach.

Files from The Canadian Press were used in this report