Canada: Wine Club Ruling Results In No Wine

Last Updated: March 26 2013
Article by William McNaughton

Most Read Contributor in Canada, September 2016

In a recent decision, the Ontario Privacy Commissioner addressed a complaint from a member of a wine club against the Liquor Control Board of Ontario ("LCBO"), a Crown agency that operates retail liquor stores across the province. Under LCBO guidelines, approved wine clubs are permitted to purchase liquor products not available through LCBO outlets for their members if the purchases are for personal use only, not for re-sale. LCBO policy requires that the wine club submit with the purchase order a list containing the names, addresses and phone numbers of each of its members placing an order and the products and quantities being purchased by each member. This information is not required if an individual purchases liquor in an LCBO retail outlet.

A wine club member complained that this collection of personal information was inconsistent with the Freedom of Information and Protection of Privacy Act  (the "Act") and amounted to collection of information about members' consumption habits. Under the Act, collection of personal information by a government institution is not permitted unless the collection is expressly authorized by statute, used for law enforcement purposes, or necessary for the proper administration of a lawfully authorized activity. The LCBO argued that collection of the personal information was necessary to administer the wine club program, and was required to

  • process the transaction,
  • facilitate a potential recall of products,
  • enable audits of the program, and
  • deter fraud generally.

The Commissioner quickly dismissed the first two purposes noting that, for reasons that were unclear, the LCBO had not collected this information from the time the wine club was registered in 2004 until the fall of 2012  and that the LCBO had been able to process transactions without that information. While collection of personal information might be helpful in the case of a product recall, the contact information might not be accurate and there were a variety of other options open to the LCBO to process a recall.

The LCBO also claimed that the collection of the personal information was necessary in order for audits to be performed to determine whether clubs were stockpiling liquor with a view to illegal resale, whether orders were placed for actual customers, and whether LCBO employees were committing fraud. The Commissioner found that the LCBO had not provided any evidence about the scope of these problems, how frequently audits were conducted in the past or the results of such audits. She also noted that illegal reselling and stockpiling of liquor may be investigated by police and by the Alcohol and Gaming Commission of Ontario under its enabling statute.  She found that the collection of personal information for audit purposes was "merely helpful" and not necessary for the administration of the sale of liquor to clubs.

The Commissioner very carefully addressed the LCBO's claim that its collection of personal information was necessary to prevent fraud and, in particular, to prevent the illegal resale of liquor. She found that no substantive information had been provided to her that fraud was a significant problem with respect to wine clubs.

She noted that the LCBO provided her with the names of 12 companies sanctioned during the period 2002 – 2005 for illegal stockpiling of wine. None were wine clubs. Personal information was provided with respect to the customers in those cases, and the Commissioner commented that "if the collection of personal information about customers was aimed at deterring fraud, it appears not to have been successful in these cases".

The Commissioner emphasized that she had not been provided with "much more than anecdotal or hypothetical evidence to support [the LCBO's] position that the illegal resale of liquor by wine clubs in this province is so problematic that it necessitates the collection of personal information of club members", and that absent such evidence that this was actually occurring on a "significant scale" was unable to find that the collection of personal information was necessary for the operation and management of the club purchasing program.

In addition, the Commissioner noted that the Chair of the LCBO had the statutory power to appoint an inspector to determine whether there was compliance with the legislation and that, in appropriate circumstances, an inspection of a club could be conducted rather than collecting personal information at the time of purchase.

The Commissioner ordered that the LCBO cease collecting personal information of wine club members to process club purchase orders and destroy all such personal information that it had collected.

In response, the LCBO announced that it would stop supplying wine clubs. That decision upset the wine clubs. The LCBO has since announced that it is appealing the decision and is seeking a stay of the Order requiring it to destroy all the personal information of wine club members that it holds, although it will cease collecting such information while the appeal is pending. We will keep you advised of further developments.

The findings mean that an institution that seeks to justify its collection of personal information on the basis of fraud prevention or deterrence will need to provide evidence that such fraud is actually occurring and is significant, that the collection of personal information is necessary, and not merely helpful, in preventing such fraud, and that other methods of preventing prevent the fraud that do not require the collection of personal information are unavailable.

About BLG

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.