I.E. Canada News


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Canada Needs Simpler, More Consistent Customs Procedures

 Posted on March 1, 2016

Guest post by Stephen Tapp, Research Director at IRPP, summarizes Joy Nott’s recent commentary, published as part of IRPP’s forthcoming publication, Redesigning Canadian Trade Policies for New Global Realities.

redesigning_canadian_tradepolicyToday, the IRPP released a new commentary, written by Joy Nott (President of the Canadian Importers and Exporters Association — I.E.Canada), as part of our forthcoming research volume, Redesigning Canadian Trade Policies for New Global Realities.

Joy Nott argues that Canada should implement policies and procedures that make it easier for companies to do business in, and with, Canada. As Jacques Roy shows in his chapter on transportation, Canadian businesses generally are not as concerned with clearance times at border crossings, ports and airports as they are with what happens “behind the border.”

Canadian traders want policymakers to pay more attention to the potentially negative impact that import procedures can have after goods have cleared customs. Nott describes this as the “supply chain echo” — whereby imports can be affected by trade policies, procedures and penalties long after goods have cleared customs and crossed borders.

This matters because Canadian firms are increasingly importing in order to export. In Canada’s manufacturing sector, for instance, about one-third of firms are two-way traders — due to the fact that the technologically-advanced goods that we export often require imported inputs.

Much of the thinking in Canadian trade policy, Nott says, mistakenly presumes that the supply chain ends with customs clearance. In reality, the red tape that occurs after firms import is a tangled web of regulations that can feel overwhelming for many Canadian businesses that trade internationally.

Changes to Canada’s policy thinking could significantly improve the global competitiveness of Canadian firms. Policymakers need to be aware of the unintended supply chain echo, and to take steps to mitigate its negative effects on businesses. Nott recommends that Canada’s import and export portfolios be merged under one ministry. And in our approach to designing regulations and reducing red tape, we should not necessarily seek fewer rules, but work toward simpler ones with more consistent outcomes. With these changes, she says that Canadian trade policy would better support our international traders — both exporters and importers — for the highly competitive global business environment of the twenty-first century.

You can read the full commentary here.

 


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Canadian Business is United: It’s Time for TPP

 Posted on October 1, 2015

Download the full Press Release word_icon

Ottawa, October 1, 2015 — The undersigned organizations, representing leading companies, farmers and hundreds of thousands of small businesses from sectors and regions across Canada, call on governments to conclude the Trans-Pacific Partnership negotiations.

Canadian companies depend on trade to expand their markets, create jobs and bring consumers more choice and better prices, which is why Canada has always been at the forefront of global trade cooperation. The TPP is the most important agreement of its kind in over 20 years and would position Canadian companies to compete on a level playing field in the world’s fastest growing region for generations to come.

We strongly believe that a high standard and comprehensive TPP covering 800 million people and 40% of the world economy will open new opportunities for Canadians. It will also build on the hard-fought advantages Canada has secured in past trade agreements with the United States, Mexico and Europe.

Failure to reach a deal in Atlanta would be a major disappointment for Canada. Even more damaging, however, would be for Canada to walk away while others complete a deal without us. The time for an agreement is now.

This is a joint statement from the following associations:

Canadian Chamber of Commerce
Canadian Manufacturers and Exporters
Canadian Council of Chief Executives
Canadian Services Coalition
Canadian Intellectual Property Council
I.E. Canada
Prospectors & Developers Association of Canada
Rx&D
Aerospace Industries Association of Canada
CAFTA (Canadian Agri-Food Trade Alliance):

Canola Council of Canada
Canadian Meat Council
Canadian Sugar Institute
Canadian Pork Council
Grain Growers of Canada
National Cattle Feeders’ Association
Canadian Canola Growers Association
Canadian Cattlemen’s Association
Barley Council of Canada
Cereals Canada
Alberta Cattle Feeders’ Association

 

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Contact:
G. Will Dubreuil
Director, Public Affairs and Media Relations
Canadian Chamber of Commerce
613.797.1860
gdubreuil@chamber.ca


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I.E.Canada to Have Seat on Newly Formed CITT Advisory Committee

 Posted on August 15, 2015

There has been an exciting new development at the Canadian International Trade Tribunal (CITT). The CITT has created an Advisory Committee to assist the CITT by seeking recommendations related to the Tribunal’s accessibility, transparency and fairness. Even more exciting is the fact that I.E.Canada, along with other associations, has been asked to sit on the committee. This allows industry, for the first time, to have a seat at the table. And it allows you, our members, to have a say on how international trade law, regulation and policy is interpreted in Canada.

The new CITT Advisory Committee will be replacing the Bench and Bar Committee. The new committee will be made up of a broad range of stakeholders including industry associations, legal associations and government departments. If necessary, the Advisory Committee will strike subcommittees to address specific issues as they arise.

The CITT says that it is specifically looking for “…recommendations about the degree to which its rules and procedures are practical and reflective of the commercial realities in which its stakeholders operate.” The committee will not be discussing specific cases, nor will its members advocate. Rather, the committee is a way for the CITT to better engage with trade and to ensure that CITT has a pipeline to the issues most relevant to trade.

I.E.Canada is very encouraged by this move and is optimistic that the Advisory Committee will serve as an important conduit through which both CITT and industry can communicate with each other. CITT has opened a direct communications channel with trade, and this is a tremendous opportunity for I.E.Canada. Expect us to be coming to you over the next few months for input on the issues and opportunities that we can bring to the attention of this new committee.

 

I.E. Canada Blog


BIG NEWS: CSA and PIP Importers Gain Access to FAST Lanes!!

 Posted on May 26, 2016

It is not very often that Canadian importers wake up to find out that there has been a breakthrough in Canadian government policy relative to border operations that importers have been requesting for many years. But on May 12, 2016, Canada Border Services Agency (CBSA) issued a press release announcing an expansion of benefits for importers in the Trusted Trader program.

Traditionally, only importers who are members of the full Free And Secure Trade (FAST) program (FAST = Partners in Protection (PIP) + Customs Self Assessment (CSA)) could access expedited processing lanes at the border frontier points, known as FAST lanes. I can remember going back as far as 25 years ago, prior to the events of 9/11 and the ensuing WTO Authorized Economic Operator (AEO) programs meant to secure global supply chains, Canadian importers were arguing that companies who registered for the PIP program alone should be given access to the priority processing lanes at border frontier points.

CBSA viewed things differently back then. With the introduction of CSA, and the hopes by the CBSA that the CSA platform would become widely adopted and revolutionize the Canadian border, the plan was that in order for Canadian importers to access the coveted FAST lanes, they needed to be both PIP and CSA. It was hoped that this would encourage importers to join the CSA program.

It didn’t work.

Canadian importers have not signed up for CSA in large numbers for number of reasons, which I won’t discuss now, but what is important and worthy of discussion today is the fact that now, importers who register for either the PIP or CSA programs will have access to FAST lanes at specific land border crossings. Truck drivers must be FAST or Commercial Driver Registration Program (CDRP) approved, and the load must consist of eligible goods from the United States or Mexico.

While some of you may read the CBSA announcement and conclude it’s of no real benefit to your company because the border crossings in question are not the ones you traditionally use, what is important to note is that this is a shift in thinking on the part of CBSA that is truly historic.

This is the first step towards what importers have been saying for years: companies that undertake and invest in becoming PIP registrants or CSA importers as stand-alone programs should have access to the FAST lanes. They are companies that have invested in supply chain security (PIP) or intense customs compliance processes (CSA) and the fact that they are not registered in both programs, for whatever business reason, should not negate the fact that they have gone to extra lengths compared to importers who chose to join no programs. If trade compliance, health, safety and security are to be the primary focus of programs such as the FAST lanes, then being allowed to gain access to expedited processing at border frontier points by simply being in either the PIP or CSA programs should have always been allowed.

But the past is the past, and the future is starting to look much brighter as CBSA makes this breakthrough announcement. We hope and genuinely expect that this will be the beginning of a further expansion of this concept to eventually include all border crossings in Canada and maybe move into different modes of transport. (That said, I.E.Canada does acknowledge that the automotive industry is concerned about the lack of infrastructure in the Windsor area and their concern that if non FAST program importers gained access to the local bridges and tunnels, it could have a serious negative impact on the automotive industry supply chain operations. As such, Windsor Ontario area border crossings have been excluded at this point in time for reasons we understand and agree with. However, the hope is that in the future the infrastructure in that region will improve, thus allowing any Trusted Trader (PIP only, CSA only, or full FAST importers) access to cross any border crossing in the country.)

We applaud that progress is finally being made and I.E. Canada continues to sit at the table with CBSA actively discussing ways to enhance the entire Trusted Trader program on behalf of our members. Onwards and upwards!


Low Canadian Dollar Is a Tax Windfall for the Canadian Government

 Posted on February 1, 2016

In my role with I.E.Canada, I am often asked what my thoughts are on the state of the Canadian dollar versus other international currencies.

When our Canadian dollar was above par, I was asked what the impact of our high dollar was on our exporters. The assumption was that a high Canadian dollar (against the US dollar) would make Canadian exports non-price competitive on the world market, unless there was something special or specific about the product. There was great concern at that time that having a very high Canadian dollar was going to negatively impact our economy and that Canadians would lose jobs because of it.

While it was not very long ago that I was talking about an at par dollar, more recently I’ve been asked what impact the rapidly tumbling Canadian dollar will have on our exporters (BNN – January 20). On the flip side to the thought that exporters are hurt by a high dollar, it is assumed that exporters would benefit from a low Canadian dollar. It is true that when our Canadian dollar is below par (compared to the US dollar) it gives Canadian exporters a price advantage when selling their goods on the world stage, but it’s a double-edged sword.

Most Canadian exporters and manufacturers must import parts and components in order to produce a product for export. With the Canadian dollar falling as rapidly as it has recently, a Canadian exporter’s purchasing ability using Canadian dollars on the world market to buy the required parts and components is hurt. The fact that they have to use more Canadian dollars to buy the parts and components does not automatically mean that they can increase their selling price on their exports. Often, export sales are based on long-standing contracts, with pricing set long before the dollar started its downward slide. That means that as the cost of materials goes up, and the selling price remains the same, profit margins are squeezed, which is not a good news story for exporters.

The other thing that you often don’t hear mentioned is the fact that as the Canadian dollar falls relative to other international currencies, it becomes a tax windfall for the Canadian government on dutiable imports. Most Canadian importers buy in global markets using US dollars. While not mandatory, the US dollar is the de facto currency of choice for most global purchases.

As any Canadian importer knows, at time of entry into Canada the value of the imported goods must be converted from whatever currency they were purchased in into Canadian dollars in order to calculate any duties and taxes owing. As the dollar falls, the values declared to CBSA on imported goods rises and, if goods are dutiable, that results in more duty being paid to the Canadian government, along with a higher amount of GST also being paid. That extra duty is a permanent gain for the Canadian government and a permanent hard cost that cannot be recovered by the Canadian importer.

As far as I know, no one has asked how that additional duty will be spent by the government. I don’t actually know how much additional duty we are talking about, but in passing somebody mentioned the number $1 billion to me – but I believe that’s just speculation.

While the value of international currencies are cyclical and we’ve all seen the Canadian dollar rise and fall before, what is unique about recent events is how fast the dollar fell from parity down to where it is today, at approximately $.70 US. Canadian supply chains, whether they be import or export supply chains, have a hard time adapting to such volatile change in such a short period of time. That’s what’s different about what’s happening right now compared to past decades when the Canadian dollar would slowly sink into the $.70 US range.

What Canadians need is stability – boring, monotonous stability. We need our dollar to sit comfortably below the US dollar and to fluctuate only mildly over sustained periods of time in order to give Canadian business leaders and foreign investors looking at Canada the confidence that they need in order to grow their businesses in Canada.

I don’t know if I’m an eternal optimist or just biased when it comes to international trade, but I do think that there are cracks of blue skies that are potentially on the horizon for Canadian importers and exporters. If agreements such as CETA and the TPP actually become ratified over the next couple of years, I believe those agreements will give Canadian importers and exporters alike opportunities to grow, and diversify, and with that will come Canadian jobs and a stable Canadian dollar.

My fingers are crossed that politicians, whether American, European or Canadian, don’t blow the above opportunities for Canada’s economy.

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Conferences

Stay Tuned

Our upcoming 2017 event line up with be announced soon.

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Customized Training Sessions

I.E.Canada is committed to supporting its members through training and education. If you are interested in having a training session customized for your company, please contact us to discuss. There are a number of different topics that we are able to provide training for. This valued service is available to I.E.Canada Members only.

We are currently offering the following customized training sessions:

Incoterms – full day course

Exports from Canada 101– full day course

For more information on any one of these sessions, please contact Paulette Niedermier at pniedermier@iecanada.com


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Webinars

 

Valuation Multi-Webinar Series – Starts August 16

I.E.Canada announces Multi-series Customs Valuation Webinar to review key customs valuation concepts and requirements, with a focus on how the CBSA administers the rules per the policies outlined in the D13 Memoranda Series. This multi series webinar will offer practical experiences, and covers judicial developments. This multi-series webinar will include 3 series. Join Lisa Zajko, Senior Manager, Customs & Global Trade Specialist, Deliotte & Touche LLP as she takes us through each series that will include 3 webinars each and build upon material covered in the previous series.
Part 1
Outlines the methods of customs valuation, and explores the 3 main requirements of the Transaction Value Method:

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BREXIT: What does it mean for CETA and Canada’s trade relations with the UK and the rest of Europe?

Will the UK really leave the EU? If so, when? A panel of leading trade and political risk advisors from Brussels, London and Toronto will address the complex interactions between EU and UK law and politics and their implications for Canadian companies trading with the EU and the UK..

September 28, 2016 11:00am-12:30pm EST: Register

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