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Regulating Business: Where are the Boundaries?

From prohibiting the sale of dogs in pet stores, to medical marijuana “compassion clubs” and body rub parlors, local governments are pushing the boundaries of business regulation and many are wondering when they are going to hit the wall.

Recently the City of Richmond gained national (and even international) attention for its decision to ban the sale of dogs (and before that rabbits) in pet shops within the City. While some other municipalities in the United States preceded Richmond in this legislative change, Richmond was considered by many to be the first to do so in the context of a business community that included three retail stores that were actively selling puppies at the time of the bylaw.

Indeed, it was the first to have such a bylaw challenged, and the first to successfully defend it.

The case, International Bio Research dba Pet Habitat, et al. v. Richmond (City), 2011 BCSC (“Pet Habitat”) has since been cited as breaking ground for similar bylaws in North America.

A November 8, 2011 Globe and Mail article identified Pet Habitat as a precedent for the City of Toronto’s recently adopted ban on the possession, consumption and sale of shark fin soup:

A case in point is the recent ban by Richmond, B.C., of the sale of dogs from pet stores. The bylaw was challenged in court on the basis that the city lacked the jurisdiction to ban the sale, but the bylaw was upheld by the B.C. Supreme Court. One lawyer commented that “Banning the sale of shark products, like banning the sale of dogs from pet stores, would be a valid municipal purpose that would likely withstand judicial scrutiny in B.C. and other parts of Canada as well”.

These two examples, the banning of puppy retail sales and the banning of shark products, provide a helpful framework for considering where our law currently stands in relation to the regulation of businesses, and where its limits may lie. This paper will explore the boundaries of business regulation in light of the law as it has been settled in Pet Habitat and as it may develop, using, as an example, the prohibition on shark products in Toronto.

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