Monday, August 31, 2009
The purposes of this Notice are:
a) to inform exporters of the Minister’s policies and practices respecting the exportation of certain sugar-containing products;
b) to inform exporters of sugar-containing products to the United States of the procedures governing the allocation of the 59,250,000 kilograms of Canadian export quota and the requirements for accessing the 5,459,000 kilograms of global export quota;
c) to inform exporters of the procedures governing the issuance of export permits for the exportation of sugar-containing products to the United States.
This notice is available on the EICB website here.
Friday, August 28, 2009
Conservative Prime Minister Stephen Harper on Friday named a member of the left-leaning New Democratic Party to be Canada’s new ambassador to the United States, as Ottawa seeks to keep trade flowing with its largest trading partner.
Harper said ambassador-designate Gary Doer had been “a strong advocate of both good, close and assertive relations with the United States.”Doer said on Thursday that he was stepping down as premier of the prairie province of Manitoba, but declined at that time to say what he would do next. Read more here.
U.S. Customs and Border Protection has announced that the requirement for importers whose shipments are valued using the First Sale Rule to indicate that on their entry summaries ended effective Aug. 19. CBP was required to collect this information and forward it to the International Trade Commission, which is conducting a review of the use of the First Sale Rule for U.S. imports during the 12-month period that began Aug. 20, 2008.
The 2008 farm bill, which effectively bars CBP from proceeding with a proposal to revoke the First Sale Rule, also required importers to declare at the time a consumption entry was filed if the transaction value of the merchandise covered by that entry is determined on the basis of the price paid by the buyer in a sale occurring earlier than the last sale prior to the introduction of the merchandise into the U.S. In order to implement this requirement, importers were required to enter the letter “F” in a miscellaneous indicator field of the entry summary for each entry line where the declared transaction value of the imported goods was determined on the basis of the first sale price.
Using the information generated by these entry summaries, the ITC expects to submit to the House Ways and Means and Senate Finance committees by Feb. 10, 2010, a report that includes the following information:
• the aggregate number of importers declaring that the transaction value of the imported merchandise is determined on the basis of the First Sale Rule, including a description of the frequency of the use of that method
• the tariff classification of such merchandise on an aggregate basis, including an analysis by sector
• the aggregate transaction value of such merchandise, including an analysis by sector
• the aggregate transaction value of all merchandise imported into the U.S. during the specified period
Source document: End of Delcaration of First Sale memorandum (PDF).
Thursday, August 27, 2009
The Department of Agriculture’s Foreign Agricultural Service announced that it has launched an enhanced U.S. foreign agricultural trade database called the Global Agricultural Trade System. The GATS database, which replaces the current U.S. trade data system, will provide users with U.S. agricultural data not previously available from FAS, including U.S. Customs district trade data, monthly and annual trade data going back to 1967, and state export data. Users will also be able to use GATS to produce charts and graphs.
FAS states that GATS will help exporters and government officials keep up with fluctuations in U.S. agricultural trade, which can help them formulate marketing and negotiating objectives and strategies. In addition, policy makers, program administrators, farmers, exporters, food aid organizations and others will be able to use this information to plan activities and make decisions.
Click here to go to the GATS database.
Canada’s current account deficit grew to $11.2 billion during the second quarter, partly driven by the first quarterly deficit on international trade in goods in more than 30 years, Statistics Canada reported Friday. The current account covers transactions between Canadians and the rest of the world in goods, services, investment income, travel and other transfers.
Goods exports fell $9.3 billion to $87.6 billion, with reductions spread over most commodities. Goods imports fell $6.8 billion to $89.4 billion, resulting in a deficit of $1.7 billion – the first one posted since the first quarter of 1976.
Trade flows with the United States were a significant factor, as the bilateral goods surplus narrowed by $3.2 billion from the previous quarter. Over the last three quarters, the goods surplus has fallen by $17.6 billion.
Reductions in total exports were widespread, led by machinery and equipment, which fell by $3.5 billion. Industrial goods were down by $2.2 billion, pushing the drop in this category over the past three quarters to almost 40%.
A one-third decline in natural gas prices during the quarter led to a reduction of $2.3 billion in the value of gas exports, while crude oil exports rose by $1.3 billion, despite lower volumes.
Summary statistics and a link to the data files are on the Statistics Canada website.
Tuesday, August 25, 2009
Homeland Security Secretary Janet Napolitano has decided against reopening negotiations with Canada over the possibility of moving the Peace Bridge truck plaza from Buffalo to Fort Erie. Napolitano’s decision, spelled out in a letter to local lawmakers, clears a key potential obstacle to construction of a huge and controversial truck plaza in a historic neighborhood on Buffalo’s West Side.
In the letter, Napolitano said “significant legal and sovereignty issues” stood in the way of building the plaza in Canada, while other improvements at the border crossing would solve congestion problems there long before the plaza could ever be moved.
“Implementing the proposed land preclearance framework would have required the United States to accept a lower level of security at a land preclearance crossing than at any other U.S. port of entry or required Canada to accept actions contrary to its Charter of Rights and Freedoms,” Napolitano said in the August 20 letter to Reps. Brian Higgins, D-Buffalo, and Chris Lee, R-Clarence. Read more here.
Ottawa’s request for `Buy American’ exemption might not stem local protectionism, observers say
Asking that Canada be exempt from the “Buy American” provision in the U.S. federal stimulus bill is just the first step to more cross-border business, says International Trade Minister Stockwell Day. But while observers say a waiver would be a step in the right direction, they question whether it will be enough to stem the tide of protectionism at the state and local levels.
Day sent a letter last Thursday to U.S. Trade Representative Ron Kirk offering “time-limited” guaranteed access to purchases by provincial and territorial governments and major municipalities in exchange for a speedy waiver of “Buy American” provisions. Day said he and Kirk have agreed to meet soon.
“I’m not sure the extent to which a waiver at the federal level is going to go down, especially when the people at the state and local levels are much closer to the electorate,” said Walid Hejazi, an associate professor of international business at the Rotman School of Management in Toronto. “It’s not going to hurt, but it’s not the silver bullet that is going to make this go away.” Read more here.
The Canada Border Services Agency (CBSA) announced today that it is initiating investigations into the alleged injurious dumping and subsidizing of certain oil country tubular goods originating in or exported from the People’s Republic of China.
The investigations follow a complaint filed by Tenaris Canada of Calgary, Alberta; Evraz Inc. NA Canada of Regina, Saskatchewan; and Lakeside Steel Corporation of Welland, Ontario. The complainants allege that the dumping and subsidizing of these goods are harming Canadian production by causing the following: lost sales, price erosion, price suppression, lost revenues, reduced gross margins, reduced profitability, loss of market share, loss of employment, reduced returns on investment and underutilization of capacity. […]
The Canadian International Trade Tribunal will now begin a preliminary inquiry to determine whether the imports are harming Canadian producers and will issue a decision by October 23, 2009. While the Tribunal is examining the question of injury, the CBSA will investigate whether the imports are being dumped and/or subsidized, and will make a decision by November 23, 2009. Read more here.
Monday, August 24, 2009
To help manufacturers of devices containing certain phthalates comply with the new labeling requirements of the revised Medical Devices Directives (MDD), Eucomed has released proposed symbols that can be used until an official labeling standard is adopted.
The MDD, which goes into effect March 21, 2010, requires specific labeling when phthalates that are classified as carcinogenic, mutagenic or toxic to reproduction are an integral part of a device intended to administer or remove medicines, body fluids or other substances or intended to transport and store such fluids or substances, Eucomed says in a statement posted recently on its website.
Plasticizers that must be identified include bis(2-ethylhexyl)phthalate (DEHP), dibutyl phthalate (DBP) and benzyl butyl phthalate (BBP), which have been classified in the EU as toxic for reproduction.
The Honourable Stockwell Day, Minister of International Trade and Minister for the Asia-Pacific Gateway, today [Friday] opened a new Canadian trade office in Recife, Brazil. This new office will build on the two countries’ growing trade and investment relationship and expand Canada’s economic presence in Brazil, Latin America’s largest and most diversified economy.
“In 2008, Canadian exports to Brazil totalled $2.6 billion, an increase of an impressive 70% over the year before,” said Minister Day. “A great number of opportunities exist for Canadian companies in Brazil’s northeast in sectors such as information and communication technologies, oil and gas, agricultural technologies, health industries and science and technology. This new trade office in Recife will be the central point of contact for Canadian firms and for Brazilian businesses seeking to establish new links in these key sectors—sectors in which Canadian companies have proven to be world leaders.”
The new office will take advantage of the Pernambuco state government’s stimulus efforts specifically devoted to revitalizing the region. The state aims to attract long-term foreign investment through fiscal incentives dedicated to the sweeping development of the region and, in particular, of the Port of Suape, one of South America’s main shipping hubs and home to a blend of commerce, industry and port services.
A new trade office will be operational in Porto Alegre in September, bringing the total number of Canadian trade offices in Brazil to six. These six offices (in Belo Horizonte, Brasília, Porto Alegre, Recife, Rio de Janeiro and São Paulo) are located in states that together contain more than half of Brazil’s total population.
More details about Minister Day’s visit to Brazil may be found at: Ministerial visit to Brazil and Ecuador.
Memorandum D13-4-13: “Post-Importation Payments or Fees: Subsequent Proceeds” (the “Guidelines”) issued last month by the Canada Board of Services Agency (“CBSA”) may be seen as a “shot across the bow” from CBSA regarding the inclusion of administration, management and other post-importation payments in the value for duty of goods imported into Canada. CBSA’s views on the law in this area will be of particular significance for importers engaged in related party transactions for goods, services and technology.
Saturday, August 22, 2009
Ottawa, provinces offer ‘time-limited' proposal that would give American firms ‘guaranteed access' to contracts
The Canadian government has offered the U.S. guaranteed access to the provinces’ public purchases in exchange for a quick waiver of Buy American provisions that have frozen Canadian companies out of lucrative American stimulus-spending contracts.
In a letter to U.S. Trade Representative Ron Kirk, Canadian trade minister Stockwell Day said such a deal would address Canada’s immediate concerns about Buy American, and could serve as a prelude to a permanent deal that would open cross-border access to provincial, state, and city contracts.
The letter, dated Thursday and obtained by The Globe and Mail, refers to a proposal that Canada submitted at the same time, after lengthy talks with the provinces.
“Through this proposal, Canada is offering time-limited guarantees to an ambitious package of sub-federal procurement in an exchange for a waiver from the “Buy American” requirements in the Recovery Act and any similar requirements in new federal U.S. legislation.
The U.S. Recovery Act, the $860-billion stimulus package pass early this year, sends about $260-billion to state and local governments in the U.S. for spending projects, but requires that all steel and manufactured goods be U.S. made. Similar provisions are included in several bills winding through the U.S. Congress.
The U.S. has down played the impact, even Canadian companies say they have been frozen out of lucrative contracts. But earlier this month, U.S. President Barack Obama brushed off the concerns.
“I do think it’s important to keep this in perspective. This in no way has endangered the billions of dollars of trade taking place between our two countries,” Mr. Obama said as he, Prime Minister Stephen Harper and Mexican President Felipe Calderon wrapped up their so-called Three Amigos summit.
“I want to assure you your Prime Minister raises this with me every time we see each other,” he had said. “[But] I think it’s also important to keep it in perspective, that in fact we have not seen some sweeping steps toward protectionism,” he said.
Spending by states, provinces, and cities is not covered by the NAFTA – Canadian provinces wanted it left out when the trade pact was signed – but Canadian provinces have agreed to negotiate some guarantees in exchange for a Canadian exception to buy American.
“This offer is ambitious in its coverage of all Canadian provinces, territories and major municipalities as well as coverage comparable to that under NAFTA for all goods and services, including construction services,” Mr. Day wrote in the letter. Read more here.
Ambassador Charles S. Shapiro, Senior Coordinator for the Western Hemisphere Free Trade Agreements Task Force, Bureau of Western Hemisphere Affairs.
Note: canada presently has free trade agreements with Chile, Columbia, Panama, Peru and Costa Rica. Free trade discussions are being conducted with the Andean Community Countries, the Carribbean Community, the Dominican Republic, Central America Four (C4). Canada is also party to the Free Trade Area of the Americas (FTAA) negotiations. Additionally, Canada has Foreign Investment Promotion and Protection (FIPAs) with a number of countries in Latin America.
Friday, August 21, 2009
The Honourable Peter Van Loan, Minister of Public Safety, joined by Russ Hiebert, Member of Parliament for South Surrey-White Rock-Cloverdale, today officially opened the new port of entry facility in Douglas, British Columbia. This modern and environmentally friendly facility will provide improved service to the public crossing the border between Blaine, Washington, and Surrey, British Columbia, in time for the 2010 Olympic and Paralympic Winter Games.
“Our government is strengthening security at our border while facilitating the flow of goods and people,” said Minister Van Loan. “This new and modern facility demonstrates how we are meeting these two goals through investing in better infrastructure for our border facilities.”
The Douglas port of entry is one of the busiest ports of entry in Canada, processing more than 2 million vehicles and over 3 million travellers each year. The new facility has been designed to meet current and future operational needs, including the use of new technologies. It has increased the number of processing lanes from seven to ten, two of which can be used as dedicated NEXUS lanes for trusted travellers. This will translate into reduced transit times for travellers.
The construction included many innovative environmental and energy efficient strategies to minimize the environmental footprint of the new facility. The building design is being considered for the prestigious Leadership in Energy and Environmental Design (LEED) Gold certification.
Ben S. Bernanke, the chairman of the Federal Reserve, offered his most hopeful assessment in more than a year on Friday, asserting that “the prospects for a return to growth in the near term appear good.” In a much-awaited speech here to central bankers and economists from around the world, Mr. Bernanke went beyond the Fed’s most recent assessment that the nation’s economy was “leveling out” and that the recession was ending.
Noting that short-term lending markets are functioning “more normally,” that corporate bond issuance is strong and that other “previously moribund” securitization markets are reviving, Mr. Bernanke said that both the United States and other major countries were poised for growth.
In emphasizing not just the imminent end of the recession – the worst since at least the early 1980s if not since the Great Depression – but also the “good” chances of actual growth, Mr. Bernanke’s assessment was in some ways surprising. Read more here and here.
Thursday, August 20, 2009
U.S. customs brokers and logistics companies that manage international shipments across the Southwest border say Mexico’s surprise move to swap out its entire border inspection force has not had any perceptible impact on trade flows so far.
Mexico’s customs agency on Sunday unexpectedly terminated its entire 700-person force of inspectors and replaced them with 1,454 newly vetted and trained agents in an effort to eliminate corruption as the government of Felipe Calderon continues its aggressive 30-month campaign to crush Mexican drug cartels, which have evolved into mafia-style organizations controlling many aspects of the economy. Drug gangs have murdered about 13,000 people, mostly rivals and police, as they fight to control their territory. The Mexican military was dispatched to airports and border stations to collect firearms from the terminated customs inspectors, the Associated Press reported. Read more here.
Ontario’s premier rallied municipal governments Tuesday to fight U.S. protectionism alongside the federal government.
Dalton McGuinty said the premiers have agreed to keep supporting efforts made by Prime Minister Stephen Harper to lobby U.S. President Barack Obama’s administration with regard to the “Buy American” provision of the U.S. government’s economic stimulus package.
“And I strongly encourage you to do the same,” he told the annual meeting of the Association of Municipalities of Ontario in Ottawa. […]
Ottawa city councillor Peter Hume, president of the AMO, said Ontario cities have already been talking to the American Conference of Mayors.
“We are encouraging our border colleagues, our border cities to talk to their mayors, to explain to them the impact that these policies would have on both of our economies,” he added. Read more here.
An easy-to-use summary of the most common non-textile duty preference programs administered by Customs and Border Protection (CBP), entitled “Free Trade Agreement and Preferential Trade Legislation Comparison—Non-Textiles”, is now posted here.
Its table-like structure highlights the programs’ many similarities and dissimilarities.
The comparison document was conceived as a preference program tool; it includes citations to the General Notes and regulations, and is intended to complement, rather than displace these and other reference materials. Additional resources are accessible from the International Agreements page of the CBP website.
Questions regarding this message may be directed to the International Coordination Branch at: firstname.lastname@example.org.
A Merchandise Processing Fee (MPF) and Duty Preference Programs table is now posted at the following link: here.
This table highlights how MPF is treated by the various duty preference programs. In some cases, a duty preference program claim entitles an importer to an MPF exemption on that entry line.
Please note that an importer may use a Special Program Indicator (SPI) to claim an MPF exemption on unconditionally free goods. A good with a General column duty rate of Free will not have an SPI indicator in the Special column of the HTSUS, because no claim for duty preference is needed. However, the SPI can still be used on the entry summary line to claim the MPF exemption. The good must meet the appropriate rule of origin and all other requirements of the duty preference program being claimed in order to qualify for the MPF exemption.
Questions regarding this message should be directed to Mr. Seth Mazze, International Coordination Branch, at email@example.com.
The beef trade row between Korea and Canada is expected to make a showdown within this month, as the World Trade Organization dispute settlement panel is expected to be established soon in line with the Canadian government's second request.
Ottawa is expected to ask again today [Thursday] that the WTO step in to resolve the beef row with Seoul that has been persisting for six years now. This second request would follow the initial request made on July 9 by Ottawa on grounds that Seoul refuses to remove its import ban of Canadian beef. Seoul would not be able to oppose arbitration upon a second request, experts say.
Korea imposed a ban on the Canadian meat in May 2003, following the confirmation of a case of mad cow disease, or scientifically known as bovine spongiform encephalopathy. Before the ban, Korea was Canada's fourth-largest beef export market, valued at $50 million in 2002. Read more here
The revision of this memorandum (PDF) is to reflect a clarification and amendment to the previous CBSA policy regarding the classification of marble and granite blocks or slabs, as a result of a Canadian International Trade Tribunal decision. Additional information has been added as it relates to the classification of crude stone slabs versus natural worked slabs, as well as commercial marble and granite versus geological marble and granite.
This memorandum outlines and explains the tariff classification of marble and granite blocks or slabs of tariff items 2515.12.00, 2516.12.10, 2516.12.90, 6802.21.00, 6802.23.00, 6802.91.00 and 6802.93.00.
Wednesday, August 19, 2009
Ontario Premier Dalton McGuinty is encouraging municipal governments to combat “Buy American” policies by reaching out to their neighbours below the border instead of adopting protectionist measures of their own.
“We are kidding ourselves if we think we can be safe by building a lifeboat just for the people in our communities,” McGuinty told the annual conference of the Association of Municipalities of Ontario this afternoon according to an advance copy of his speech. “In an age of globalization, at a time when our jobs depend on strong trade, what's called for is not a lifeboat for a select few. We need an ark, for all of us.”
McGuinty said the best way to recover from the economic downturn is by working together. “I want to thank all of you who have spoken out against 'Buy American' protectionism and reached out to your counterparts across the border,” McGuinty said, adding that he and other premiers have endorsed efforts by Prime Minister Stephen Harper to ask the U.S. to exempt Canada from the protectionist provision in its federal stimulus bill. “I strongly encourage you to do the same,” McGuinty said. Read more here.
Memorandum D3-1-7 (PDF) has been written to provide regulatory and procedural information about the Customs Self Assessment (CSA) Program for Carriers. It reflects amendments made to the Accounting of Imported Goods and Payment of Duties Regulations, Reporting of Imported Goods Regulations and Transportation of Goods Regulations explaining the requirements for the CSA program.
Memorandum D17-1-7 (PDF) has been written to provide information and guidelines regarding the Customs Self Assessment (CSA) Program for Importers. It reflects amendments made to the Accounting of Imported Goods and Payment of Duties Regulations, and the Reporting of Imported Goods Regulations explaining the requirements for the CSA.
Tuesday, August 18, 2009
The U.S. government has appealed a June 16 ruling by the Court of International Trade that the government’s authority to impose 100% duties against goods imported from the European Union in retaliation for its ban on U.S. hormone-treated beef expired on July 29, 2007, because the beef industry did not file for an extension of the sanctions.
Pursuant to its decision, the CIT ordered a refund of all punitive duties paid on affected goods imported after July 29, 2007. Although the ruling explicitly applied to only one product (rusks and toasted breads from Spain), the implication is that any product subject to the 100% retaliatory duties would be eligible for refunds of such duties paid after July 29, 2007, as well.
As a result, dozens of companies have already filed cases seeking refunds of the retaliatory duties they have paid since that date. Importers who are not already pursuing refunds in this manner should do so as quickly as possible, as the court only has jurisdiction to refund duties paid within two years from the date the cause of action arose. Read more here.
Consumer safety agency can do little about items such as tainted drywall
The Consumer Product Safety Commission is unable to access key shipping information to target suspicious products entering the United States, has no long-term plan for ensuring the safety of those imports and has yet to implement critical provisions of a law passed last year to strengthen its regulatory authority.
Those were the findings of a new report issued by the Government Accountability Office, which acts as the investigative arm of Congress. The report found that the CPSC — the lead agency in the investigation of tainted Chinese drywall — lacks vital tools as well as manpower to effectively stop faulty imports.
The CSPC has limited presence at U.S. ports and has to rely on U.S. Customs and Border Protection officials who are, in turn, under pressure to move shipments quickly, the report says. Read more here.
Monday, August 17, 2009
An effort to elevate trade facilitation as a top priority alongside security and enforcement within U.S. customs agencies for the first time since the September 11, 2001, terrorist attacks, has a good shot at being enacted in the 111th Congress, stakeholders say.
A customs reauthorization bill introduced late last week by Senate Finance Committee Chairman Max Baucus, D-Mont., and ranking member Charles Grassley, R-Iowa, could move in committee this fall, sources said. Finance has been working on a bill since 2006, and lobbyists said the staff work and resources devoted to it are unprecedented. […]
The measure would establish Customs and Border Protection and Immigration and Customs Enforcement within the Homeland Security Department as separate agencies with their budgets. It would also create an office to consolidate trade facilitation duties within CBP as well as a liaison between the agency and the private sector, while requiring consultations with other agencies and industry stakeholders before proposing regulations impacting trade.
The bill would require CBP to identify benefits for voluntary industry participants in programs such as the Customs-Trade Partnership Against Terrorism. “CBP has promised more trade benefits to participating importers, but those benefits have not come to fruition,” said Stephanie Lester, vice president for international trade at the Retail Industry Leaders Association. “We welcome Congress’ guidance that more should be done to encourage public-private partnerships.” Read more here.
The U.S. Consumer Product Safety Commission should work “expeditiously” to implement key provisions of federal law to ensure that imported consumer products are better regulated, a government report released Friday said.
The report by the Government Accountability Office also recommends that the commission resolve issues it has with the U.S. Customs and Border Protection, saying that it “does not have access to key [customs] import data it could use to target incoming shipments for inspection.”
The Consumer Product Safety Commission has agreed with the GAO’s recommendations, according to the report.
Consumer advocates have criticized the commission for not implementing portions of the Consumer Product Safety Improvement Act that address U.S. consumer protection. Read more here.
The House Foreign Affairs Committee is developing legislation that would overhaul U.S. controls on the export of certain technologies with potential military applications, the panel’s chairman said.
Industry groups and experts have argued for years that the controls often hamper trade by requiring licenses for too many products that are widely available in global commercial markets. And more resources should be focused on protecting truly sensitive technologies, they say.
On Thursday the White House said the National Economic Council and National Security Council will oversee an interagency study of the system of controls over exports of defense goods and “dual-use” items that have both commercial and military applications. Read more here.
(Miami Herald – Andres Oppenheimer)
The U.S.-Mexico-Canada summit earlier this week was almost universally described in the media as a photo-op, with no substantive results. I don’t think so: It may have been a major step in helping to convince President Barack Obama about the need of greater North American integration. […]
Among the things that Obama heard from his counterparts in Guadalajara:
• Canada and Mexico together buy eight times more U.S. goods than China. While North American trade has tripled since NAFTA went into effect 15 years ago, the growth rate of regional trade has slowed since 2001, largely because of increased border restrictions.
• U.S., Canadian and Mexican exports are losing market share in the global economy. While the three North American trade partners together accounted for 19% of world exports in 2000, they made up only 12.7% in 2008. The U.S. share alone dropped from 12% to 8% over the same period.
• Asian and European countries have signed new free trade agreements and strengthened existing ones in recent years. In North America, meantime, no new roads or border crossings have been built over the past seven years, which is increasing transportation costs along the border and making North America less competitive globally.
• To become more competitive and get out of the economic crisis sooner, NAFTA members should build new border crossings, ease obstacles to trade and harmonize production and labeling rules. If U.S., Mexican and Canadian companies could produce goods with labels that are valid in all three NAFTA member countries, they reach 450 million people living in North America instead of being confined to their home markets.
Read more here.
Japan has joined the short but growing list of developed countries to emerge from recession, its government said Monday, by posting 0.9% economic growth in the second quarter of 2009.
After the global financial crisis struck last year, the world’s second-largest economy shrank for four consecutive quarters, its largest decline since Second World War. But according to new data released Monday, recovering exports and a sweeping stimulus program helped it grow by an annualized growth rate of 3.7% during the three months ending June 30.
Cutting taxes and creating incentives to buy energy-efficient cars and household appliances helped encourage consumer spending. The Japanese government has also promised to spend roughly US$263 billion to stimulate the economy. That includes cash handouts and public spending on infrastructure projects such as reinforcing the country’s public schools against earthquakes.
Still, Japan’s unemployment rate was 5.4% in June, the highest in six years. And wages fell between April and June. Read more here.
Sunday, August 16, 2009
Bid to overturn Buy American regulations won’t have much effect while the U.S. president’s distracted by huge health-care reform challenge
If you’re a U.S. president confronting a 9.7-per-cent jobless rate and desperately seeking congressional support for health-care reform, what are the chances you’ll focus on fighting "Buy American" trade provisions?
But while U.S. protectionist provisions are unlikely to stir Barack Obama, they’re becoming a big political headache for Stephen Harper.
A meeting between the president and the prime minister is set for Sept. 16 in Washington, D.C., and the pressure will be on Harper to get results.
Additionally, the autumn looks like it will be a highly charged political season for Harper. A non-confidence vote looms the week of Sept. 28, potentially triggering an election — an ideal time for the PM to score a coup on U.S. protectionism.
Read the complete editorial here.
Friday, August 14, 2009
So far this week, the World Trade Organization has rebuffed China in an important case involving Chinese restrictions on imported books and movies. The Chinese government dropped explosive espionage charges against executives of a foreign mining giant, the Anglo-Australian Rio Tinto, after a global corporate outcry. And on Thursday, the government said it had backed off another contentious plan to install censorship software on all new computers sold here.
Throughout its long economic boom, China has usually managed to separate its aggressive push into the global business arena from domestic politics, which remained tightly controlled by the Communist Party. But events this week raise the question of just how long it will be before the two meet.
In each of those matters, politics and business collided, and business won. Business does not always win, and when it does, as in these cases, the reasons are as often as not a matter of guesswork. But in at least some high-profile matters, China appears to be facing the reality that the outside business world can be freewheeling and defiant when its profits are threatened. And so China’s authoritarian system may also have to evolve in ways its top leaders may not readily endorse. Read more here.
Thursday, August 13, 2009
Two of Europe’s biggest economies — Germany and France — reported signs of a recovery. Each saw growth of 0.3 percent in this year’s second quarter.
But despite a turnaround for those countries, much of Europe is still mired in recession.
Roben Farzad, a senior writer for BusinessWeek, joins Martin Savidge to discuss how fast the world economy is rebounding and to analyze what it will mean for the United States.
Prime Minister Stephen Harper warned Canadians on Thursday that discouraging protectionist trade policies in the United States might not be a straightforward task.
Speaking at a news conference announcing a new economic agency for southern Ontario in Kitchener, Harper touched on the subject of how Canada could best discourage a growing call for trade protectionism by its southern neighbour.
Protectionism in the face of moribund local economies featured prominently in discussions in Guadalajara, Mexico earlier this week among Harper, U.S. President Barack Obama and Mexican President Felipe Calderon.
There are global fears that the “Buy American” provisions slipped into the $787-billion US stimulus package by the U.S. Congress last February and designed to stimulate job creation in the United States will cut off any nascent economic recovery in Canada at its knees.
Ottawa is confident that an agreement on the issue can be reached, Harper said, but he cautioned that won’t simply being a case of getting a pledge from Obama on the issue. Read more here.
Related: Canada, U.S. business groups unite against Buy American (Calgary Herald)
The Canada Border Services Agency (CBSA) launched a Branding Initiative earlier this year to strengthen the Agency’s identity and culture. The Initiative supports the Agency’s plan of action to help the CBSA respond to the border of the future.
For the CBSA, branding is about creating a positive and lasting image of the Agency and its interactions with stakeholders, employees, partners and the public. A brand is a combination of an organization’s visual image, messages, actions and behaviour.
The CBSA is in the process of developing a new brand and needs your input. Your thoughts and suggestions will help in the development of a brand that accurately represents the CBSA to stakeholders like you.
To ensure that the greatest possible number of replies are received, please provide your response and forward this message and questionnaire to other stakeholders in your organization.
Responses should be sent to firstname.lastname@example.org by September 1, 2009. The survey is available in English and French. Should you have any questions, please contact Tara Cosgrove (613-946-4873, email@example.com).
This Friday three important provisions of the Consumer Product Safety Improvement Act take effect that lower acceptable lead levels, raise the amount of civil penalties and require tracking of children's products. Here are the details:
The legislation reduces the total lead content in children's products to 300 parts per million (ppm) from 600 ppm and also limits the amount of lead in surface coatings or paint to 90 ppm.
The lead rules also apply to children's jewelry.
In 2007, dubbed the "Year of the Recall," millions of toys were recalled because they violated lead levels.
The Consumer Product Safety Commission is also hiking its civil penalties for companies that fail to report hazardous products to the agency in a timely manner from $8,000 per violation with a maximum of $1.825 million to $100,000 per violation with a maximum of $15 million.
"If the record of recent CPSC-announced recalls is any indication of the approach companies have taken to date in complying with this reporting requirement, then many manufacturers, importers, distributors and retailers could be subject to increased penalties for reporting violations" commented Alan Schoem, a former CPSC compliance director, in the Product Safety Letter.
He added that a "reinvigorated Commission" led by new chairman Inez Tenenbaum could pose a challenge for companies that do not have processes and procedures in place to report a product defect or potential defect to the CPSC. A quick look at some recent recalls that we've written about (string trimmers, tea kettles, baby floats) shows that many companies wait far too long to alert the CPSC after getting reports of defective products.
Also starting Friday, U.S. companies are required to put tracking information on all toys and children's products. The requirement is for a tracking label or other distinguishing permanent mark that contains certain basic information, including the source of the product, the date of manufacture, and more detailed information on the manufacturing process such as a batch or run number.
"The primary purpose of the distinguishing marks is to aid in the quick and effective facilitation of recalls involving children’s products," said Tenenbaum in a written statement.
(Alexander Panetta — The Canadian Press)
PM: Global trade talks ‘stalled,’ Canada to pursue bilateral deals
Canada will proceed with a flurry of free-trade deals because the dream of one big global trade arrangement appears “stalled,” Prime Minister Stephen Harper said Tuesday.
He made the remarks at a signing ceremony at the presidential palace in Panama, which became the eighth country to reach a free-trade agreement with the Harper government.
Canada exported a mere $128 million to Panama last year — but that country’s economy is growing at a blistering pace, with a 9.2 per cent increase last year despite the global recession.
The deal fits the step-by-step strategy now being pursued by the Harper government.
That piecemeal approach will help fill the vacuum left by the apparent collapse of the Doha round of global trade talks at the World Trade Organization.
“I agree a number of these agreements are small, but if you add them up they become larger and larger,” Harper told a news conference. Read more here.
Related: A list of existing free trade agreements and the current status of those pending or being negotiated can be found at the International Trade Canada website.
Michigan hasn’t purchased one acre of land
The Canadian government is wasting its money acquiring land for a new bridge across the Detroit River because the costly project will never go ahead, a U.S. lawmaker said Monday.
Ottawa has so far paid $34 million to the City of Windsor for 94 acres of land -- and is negotiating with 10 other property owners for a total of 202 acres. Michigan, however, not only has yet to purchase a single acre, but has not yet even given approval to buy any land, said Bill Shreck, spokesman for the Michigan Department of Transportation.
“This isn’t a done deal at all,” said Senate Majority Floor Leader Alan Cropsey, a Republican and the leading opponent of the taxpayer-funded bridge. “If Canadian taxpayers want to blow money on purchasing land, that’s their prerogative. We blew money ($2 million) on a useless bridge study here in Michigan. Read more here.
Related: Bridge plan proceeding, Duncan says (Windsor Star)
Wednesday, August 12, 2009
Municipalities adopt protectionist measures despite Obama’s pledge
Eugene Delgaudio wants to get a few things out of the way before he begins to say anything about bilateral trade.
Delgaudio, a member of the board of supervisors of Loudoun County, Va., says the jurisdiction of about 283,000 people buys a large amount of stuff. They are building a lot of schools. They spend about $1 billion (U.S.) a year without even dipping into state or federal funds.
Delgaudio wants it clearly understood there was a good reason – not just a “jingoistic” or “patriotic” reason – for the suburb of Washington, D.C., to adopt one of the “Buy American” resolutions that are causing so much hand-wringing by his neighbours to the north.
“We’re not just blue-collar rednecks saying ‘Buy American,’” explains Delgaudio.
“It’s more what I think to be an attempt to help local companies in Loudoun County.”
The Loudoun board is just one of hundreds of municipal governments that have adopted resolutions promising to spend their stimulus funding on U.S. companies – even though that is already a provision of the stimulus bill passed by Congress. Read more here.
Related: PM right to lash out at 'Buy USA’ (Toronto Star)
Wide-ranging trade decision could spell massive market opportunities for U.S. businesses in China
The United States has won a wide-ranging ruling against Chinese trade practices that could provide massive market opportunities for American makers of everything from CDs and DVDs to music downloads and books.
The verdict released Wednesday at the World Trade Organization in Geneva finds definitively against China for forcing American media producers to route their business in China through Chinese state-owned companies.
The WTO victory comes as President Barack Obama is being pressed to be tough on trade rules with China, which many Democrats in the U.S. Congress blame for America’s soaring trade deficits and lost manufacturing jobs. The case is sensitive also for the Chinese government, which asserts the right to keep out content it finds objectionable. Read more here.
CTA has just received further clarification from U.S. Customs on the modification to ruling HQ113129 requiring a manifest and entry for all residue entering the U.S.
Customs and Border Protection has clarified that all residue remaining in a tanker must have both a manifest and entry on file. This requirement applies to residue from any and all cargo types, not just chemicals, as long as the residue is that of the cargo. For example, if a tanker filled with milk offloads in Canada, and milk residue remains in the tank, the milk residue must have a manifest and an entry filed prior to return to the U.S.
Residue that is incidental to the cargo (residual lubricant oil from auto parts) does not require a manifest or an entry. In this case, the cargo is auto parts not the lubricant oil.
Residue remaining in means of containment such as kegs, casks, barrels and drums does not require a manifest or an entry.
Every tanker that crosses into the U.S. should be cleaned of residue, otherwise the tanker is deemed “not empty” and the residue must be manifested and cleared through a Broker.
Please note the ruling will become effective September 16, 2009, at which time there may be increased enforcement by CBP for failure to manifest and declare residue.
The ruling on page 138 can be found here (PDF).
As expected, a weekend summit among the leaders of the U.S., Canada and Mexico yielded no concrete measures on trade. The U.S. and Mexico did discuss their ongoing dispute over access for Mexican trucks but there was no indication as to when or how the two sides might resolve it. A joint statement following the meeting focused primarily on the need for further trilateral cooperation on trade and economic issues.
With respect to trade, President Obama, Canadian Prime Minister Stephen Harper and Mexican President Felipe Calderon pledged to “abide by our international responsibilities and avoid protectionist measures.” They also reiterated their commitment to “reinvigorate our trading relationship and to ensure that the benefits of our economic relationship are widely shared and sustainable.” The three leaders sidestepped the issue of a possible renegotiation of NAFTA to include enforceable provisions on labor and the environment, saying instead that they will engage in a “continuing dialogue to address the functioning of the Labor and Environmental side agreements.” The joint statement cited work in a number of other trade-related areas as well, including modernizing border infrastructure to facilitate trade and the smooth operation of supply chains, strengthening the resilience of critical infrastructure, cooperating in the protection of intellectual property rights and reducing unnecessary regulatory differences.
Read more here.
Prime Minister Stephen Harper of Canada and President Ricardo Martinelli of Panama [have] signed a free trade agreement, continuing Canada’s efforts to bolster investment and trade in the region after talks at the Doha round of World Trade Organization negotiations stalled. The agreement will remove tariffs on 90% of goods imported from Canada, with those remaining to be phased out over the next decade, Mr. Harper’s office said.
Canada exported $128 million Canadian dollars ($118 million) of goods like meat, forest products and flight simulators to Panama in 2008, up 48% from 2007, the office said.
Tuesday, August 11, 2009
The United States Department of Agriculture announced a new program to draw attention to eco-minded consumer products: BioPreferred. Products included in this program would be allowed to use special labeling that highlights a product’s partial or complete inclusion of natural ingredients. This program, created in 2002 and expanded in 2008, recently began promoting the program through social media networks like Twitter, Facebook, and various green blogs.
The program has drawn a certain level of criticism, and environmentalist publications like Treehugger have raised concern about domestic favoritism, and the true value of products certified as BioPreferred. According to the USDA, the purpose of the program is to increase the growth of agriculture in the United States and to benefit rural communities. In a proposed version of the bill, government purchases may be regulated to be BioPreferred when possible, raising concerns that the voluntary program may become mandatory for any company that wishes to do business with public projects.
Despite the program only being publicized recently, there are already over 10,000 products in the BioPreferred catalog, and an open application to have new products listed. Learn more about the program on the BioPreferred program website.
Rep. Brad Sherman, D-Calif., introduced recently the Export Control Improvements Act (H.R. 3515), a bill similar to but different in some key aspects from similar legislation introduced in 2008.
H.R. 3515 incorporates several provisions relating to the electronic filing of export data via the Automated Export System.
• The Department of Commerce may establish a registration program for agents to file information in AES on behalf of the U.S. principal party in interest or the foreign PPI. This program could include requiring individuals, corporations, associations or partnerships to obtain authorization to file.
• AES would alert filers to export license requirements based on data elements they enter and issue notices, compliance alerts and other warnings if a given transaction may not comply with export control laws or regulations. AES would not, however, prohibit potentially violative transactions from proceeding.
• AES would be modernized so as to (i) enable the classification of exported products, (ii) ensure that changes in export control laws and regulations are reflected in AES immediately upon implementation, (iii) make the various restricted parties lists available in a standardized format, and (iv) retain records of user actions while filing export data.
Read more here.
Monday, August 10, 2009
The International Trade Commission released July 30 The Year in Trade 2008, its annual review of U.S. trade-related activities. This publication reviews the administration of U.S. trade laws and regulations, the operation of the World Trade Organization, U.S. free trade agreements and negotiations, and relations with major trading partners. It includes:
• complete listings of antidumping, countervailing, safeguard, intellectual property rights infringement and section 301 investigations undertaken in 2008;
• the operation of trade preference programs such as the Generalized System of Preferences, the African Growth and Opportunity Act, the Andean Trade Preference Act and the Caribbean Basin Economic Recovery Act;
• significant activities in the WTO, including its dispute settlement mechanism, and the Organization for Economic Cooperation and Development;
• developments in bilateral and regional FTAs; and
• trade relations with major trading partners such as the European Union, Canada, China, Mexico, Japan, Korea, Taiwan, Brazil and India.
The report can be downloaded here (217 pages PDF).
President Obama told Mexican President Felipe Calderon he is committed to resolving a dispute over Mexican truck access to U.S. highways, Bloomberg reported Monday. Obama said he will also address safety concerns about the trucks that have been raised by Congress, an administration official said after the two leaders met in Guadalajara, Mexico, Sunday in a weekend summit among North American leaders, Bloomberg said.
Calderon told Obama that the dispute has hurt trade, raised consumer costs and reduced job creation, according to a Mexican statement, Bloomberg reported.
Mexican trucks have been allowed to operate in a border zone within about 25 miles of the U.S.-Mexico border, and the Department of Transportation under the Bush administration began a pilot program in 2007 allowing some Mexican carriers to operate on all U.S. roads. Read more here.
Senate Finance Committee Chairman Max Baucus, D-Mont., and Ranking Member Charles Grassley, R-Iowa, introduced Aug. 6 a customs reauthorization bill designed to strengthen U.S. Customs and Border Protection’s customs facilitation and trade enforcement efforts. The two lawmakers emphasized that one of the measure’s primary aims is to “reprioritize the trade functions” of CBP.
According to a joint press release, the Customs Facilitation and Trade Enforcement Reauthorization Act of 2009 includes the following provisions.
New Offices and Positions
The bill creates
(1) a new principal deputy CBP commissioner whose responsibilities include overseeing CBP’s commercial operations and coordinating customs facilitation and trade enforcement training programs for agency personnel,
(2) an Office of Trade within CBP that will assume the functions and personnel of the existing offices of International Trade, International Affairs and Trade Relations,
(3) a Customs Facilitation and Trade Enforcement Division within CBP’s Office of Field Operations,
(4) a new trade advocate to act as a liaison between CBP and the private sector, including on customs facilitation and trade enforcement efforts, and
(5) a director of trade policy within the Department of Homeland Security’s Office of Policy and Planning who must coordinate with CBP to ensure that international trade interests are considered when DHS develops and implements policies.
CBP will be explicitly allowed to use the mandatory advance information it collects for commercial enforcement purposes.
CBP and U.S. Immigration and Customs Enforcement will prepare, in consultation with the Commercial Operations Advisory Committee and the Trade Support Network, a biennial joint strategic plan outlining their plans to improve the enforcement of customs and trade laws as well as trade facilitation.
A new Commercial Targeting Division within CBP’s Office of Trade will target imports that may violate U.S. customs and trade laws, with particular focus on laws and regulations related to intellectual property rights, health and safety, agriculture, textiles and apparel, general revenue and non-general revenue, such as antidumping and countervailing duties. The CTD is required to establish methodologies for evaluating the risk that imports may violate U.S. customs and trade laws and for issuing trade alerts when it determines that cargo may violate such laws. Trade alerts may direct further inspection or physical examination or testing of merchandise by port personnel.
CBP will be required to assign at least 40 commercial enforcement officers to supervise all trade enforcement activities at the 40 busiest ports of entry.
Read the complete summary here.
Finance Minister Jim Flaherty is in China pitching Canada’s banking system to investment officials in one of the world’s most important economies. “The potential here is enormous,” he told CBC News from Beijing, where he is leading a group of officials from Canada’s largest banking and insurance firms on Canada’s largest trade mission to China in years.
Flaherty said he hopes his visit will spur Chinese investment in Canada’s resource and financial service sectors. “We have a strong economic relationship with China,” he said. “But we need to make it grow.”
Flaherty’s second trip to China as finance minister is meant to court the country’s coveted market as exports slow to the United States, Canada’s largest trading partner. There are hopes that China’s booming economy can mitigate a U.S. economy that has been battered by a crumbling housing market and battered consumer spending.
“I think, over time, we will see more investment by Chinese businesses in Canada,” Flaherty said. “I think, over time, we’ll also see growth by our financial institutions in this market, which is just a terrific prospective market for our banks and insurance companies based in Canada that operate globally.” Read more here.
Sen. Sheldon Whitehouse, D-R.I., introduced August 6 the Foreign Manufacturers Legal Accountability Act of 2009, which he said aims to further protect U.S. consumers and businesses from injuries caused by defective products manufactured abroad. Specifically, Whitehouse said in a floor statement, this measure would address the two major legal hurdles facing consumers injured by defective foreign products and businesses whose foreign partners refuse to honor their contracts: the inability to serve process on foreign manufacturers (i.e., give them the legally required notice that it is the subject of a lawsuit) and the ability of foreign manufacturers, even if served, to evade the jurisdiction of U.S. courts. Read more here.
President Obama today acknowledging there is what he called a vigorous debate on health care. He made those remarks at a summit with President Felipe Calderon of Mexico and Prime Minister Harper of Canada, in the Mexican city of Guadalajara. One of the top issues in the summit, the global swine flu outbreak.
The outbreak began in Mexico in the spring and there are concerns that it could significantly worsen this fall. President Obama said, quote, “this challenge transcends borders and so must our response.” President Obama also indicating he believes borders are less important in North America in the 21st century.
The president saying, quote, “North America’s defined not simply by our borders, but by our bonds.” To many, his remarks suggest the president wants even closer ties… Read the complete transcript here.
Friday, August 7, 2009
The Food and Drug Administration’s new chief promised Thursday to crack down on food and drug companies that break the law, as the agency tries to regain its footing after a string of high-profile safety problems.
FDA Commissioner Margaret Hamburg said her agency must act more swiftly and aggressively against companies that don’t meet safety standards.
In recent years, the agency’s efforts “have been hampered by unreasonable delays” that allowed safety violations to go unaddressed, Hamburg told an audience of food and drug industry lawyers.
The FDA has struggled for years to keep up with its rising responsibilities to oversee health care and food products. Since early 2008, the agency has been criticized for its handling of tainted peanut butter that sickened hundreds, contaminated blood thinners imported from China linked to deaths, and an investigation into a salmonella outbreak that dragged on for weeks before peppers were identified as the culprit. Read more here.
North American business groups urged leaders of the United States, Mexico and Canada on Friday to rein in “buy local” provisions they called a threat to free trade and economic growth.
“In this global economic downturn, it is imperative that the three countries work together more intensively than ever to make the most of their strengths and set the stage for robust and sustained economic recovery,” the North American Competitiveness Council said.
Mexican President Felipe Calderon will host U.S. President Barack Obama and Canadian Prime Minister Stephen Harper on Sunday and Monday in Guadalajara for an annual meeting of North American leaders.
The advisory group made up of leading U.S., Mexican and Canadian business associations had its sternest advice for Obama, who they urged direct his administration to “clarify its intent and interpretation” of Buy American provisions passed as part of the $787 billion economic stimulus bill.
Obama, responding to an international outcry over the measure, persuaded Congress to exempt free-trade partners like Canada and Mexico from the strict requirement that public works projects funded by the bill use only U.S.-made goods. Read more here.
August 6, 2009 meeting with Blue Water Bridge Canada, U.S. Customs and Border Protection, Ontario Provincial Police Blue Water Bridge Canada (BWBC) together with its partners U.S. Customs and Border Protection (CBP) and the Ontario Provincial Police (OPP) met today (Thursday, August 6th) in an effort to work together to help mitigate, as much as possible any delays and safety issues as it relates to traffic approaching the Blue Water Bridge. Due to Sarnia City Council’s decision not to grant a noise exemption to the Ministry of Transportation for night work, the Highway will at times be single lane to allow construction of the Highway 402 Phase One Improvements.
“Blue Water Bridge Canada and the Michigan Department of Transportation are fortunate to have an excellent relationship with the local O.P.P., and U.S. Customs and Border Protection at the local, regional and national level” states Stan Korosec Vice President of Operations for Blue Water Bridge Canada. “Today we came up with a plan to help mitigate the type of delays experienced on Tuesday August 4th due to the single lane of traffic.
In addition to the constant communication that occurs daily between BWBC and CBP, new protocols were developed with respect to lane allocations and traffic management that we feel will help to ensure the safe and efficient flow of both cars and trucks at this vital trade link between Canada and the United States. Although these steps will assist in the safe and efficient flow of traffic, there will still be periods where extensive queues of traffic will exist.”
Canada’s premiers are firmly behind Prime Minister Stephen Harper in his bid to counter protectionist trade policies being adopted in the U.S.
In a rare show of unity, premiers of all political stripes yesterday vowed to help Harper as he fights the so-called Buy America provisions being applied by American state and local governments that prevent Canadian companies from bidding on projects funded by President Barack Obama’s $787 billion (U.S.) stimulus package.
Harper is to meet with Obama on Sunday in Mexico, and with the premiers’ endorsement in hand, he is expected to tell the president Canada is ready to move ahead in the effort to neutralize the Buy America problem. This will lay the groundwork, sources say, for International Trade Minister Stockwell Day to send a letter to U.S. Trade Representative Ronald Kirk next week indicating that Ottawa is ready to begin bilateral negotiations aimed at solving the issue.
Premier Dalton McGuinty said it’s essential the premiers give Harper a “strong hand” for the meeting with the U.S. president and Mexican President Felipe Calderon in Guadalajara, Mexico.
“We cannot escape our interdependence. This is an era of globalization. We’re in this together,” McGuinty said at the annual Council of the Federation meeting.
“The appeal that we have to make to our American cousins is one based on their enlightened self-interest,” said the Ontario Liberal. Read more here.
Thursday, August 6, 2009
A day after Ottawa offered cash to provinces to harmonize their sales taxes across the country, the few holdouts remain cool to the HST idea.
On Tuesday, Finance Minister Jim Flaherty said Ottawa was willing to offer financial support to provinces choosing to harmonize their provincial sales tax with the federal GST.
Business groups like the idea because they argue it reduces red tape and lowers the tax on investment. But harmonization detractors argue it ends up costing consumers more in real terms because the GST applies to more goods and services than the provincial levy.
Though he stopped short of rejecting the plan outright, P.E.I. Premier Robert Ghiz says it will take more money than Ottawa is currently offering if he is to consider harmonizing provincial sales tax with the GST.
He said the revenue loss to the province must be offset before considering any harmonization proposal, and specifically requested that exemptions be allowed allowed for home heating fuel and clothing.
In P.E.I.’s case, the blended tax would actually be lower. He acknowledged the plan would mean a tax cut for Islanders, but he also wants to ensure the province can afford to protect those most vulnerable, he said.
In Manitoba, a spokesperson for Manitoba Finance Minister Greg Selinger confirmed the province is looking at the offer. The province’s stance has traditionally been against any harmonization plan, but Ottawa’s subsidy offer appears to be enough to at least consider the proposal. Read more here.
Wednesday, August 5, 2009
U.S. President Barack Obama officially takes his place as one of the so-called Three Amigos during the North American leaders’ summit in Mexico this weekend. Yet he will be joining a trilateral alliance that has been in a state of virtual hibernation since his predecessor, George W. Bush, left the scene.
Instead, he and counterparts Stephen Harper and Felipe Calderon will be confronting the reality of a continental alliance adrift and in sore need of political direction and leadership.
With the Bush-era Security and Prosperity Partnership having largely petered out from a lack of direction and a toxic public image, the leaders have a chance to reinvigorate or reinvent the trilateral alliance.
But with three distracted leaders of questionable compatibility, and an apparent lack of a grand vision for the way forward, the future of this forum—and North American integration in general—remains far from certain. […]
Liberal Foreign Affairs critic Bob Rae cautioned against aggressively pursuing continental integration at a time when the “American Congress is in a deeply protectionist mood.”
Pointing to Canada-U.S. trade disputes such as softwood lumber, black liquor and COOL, as well as immigration concerns related to Mexico, he said: “It’s pretty hard to talk about integration when there are such significant barriers to flow of people and of goods and services among the countries.” Read more here.
Trade lawyers say the government’s decision to challenge the European Union’s ban on seal products at the World Trade Organization sends a strong signal Canada is prepared to stand up to trading partners that go back on their commitments.
In fact, they are hoping the seal ban challenge and two others launched in recent months represent a major change in Canadian trade policy, with the country joining what they describe as a new trend toward actively enforcing international trade rules.
Others, however, feel the challenges are more about satisfying specific interest groups rather than the start of a badly needed “offensive strategy” when it comes to Canada and trade disputes.
Over the years, Canada has initiated trade actions against a number of states over a variety of issues. Some, like a challenge over an EU ban on genetically modified foods, went all the way to a trade dispute panel. Others, such as a joint Canadian-Brazilian challenge over U.S. farm subsidies, are still ongoing, while some have stalled. Read more here.
Tuesday, August 4, 2009
The Honourable Stockwell Day, Minister of International Trade and Minister for the Asia-Pacific Gateway, today announced that the Canada-Peru bilateral free trade agreement (FTA) came into effect on August 1, 2009.
“Ensuring free and open trade is vital to international efforts to halt the global recession,” said Minister Day. “Our economic prosperity depends on creating new opportunities through open markets, and this free trade agreement with Peru will provide such opportunities with one of the most dynamic economies in Latin America.”
Canadian producers will benefit from the elimination of tariffs on exports into Peru. Many agricultural exports such as wheat, barley, lentils and peas will receive immediate duty-free status. The FTA provides enhanced market access in service sectors that are of interest to Canada, including mining, energy and professional services. Canada’s banking, insurance and securities sector will also benefit from greater access to the Peruvian marketplace.
Parallel agreements on labour cooperation and on the environment also came into effect on August 1. The labour agreement commits Canada and Peru to respecting and enforcing international labour standards such as the elimination of child and forced labour, freedom of association and the right to bargain collectively. The environment agreement commits both countries to substantially increase environmental protection, to enforce their respective environmental laws, and to refrain from diminishing these laws or reducing their enforcement to encourage trade and investment.
This is the second trade agreement Canada has implemented this year: in June, Canada’s FTA with the European Free Trade Association (EFTA) came into force. Canada’s Economic Action Plan focuses on helping Canadian businesses and investors succeed in world markets. The ambitious trade agenda includes negotiations to improve market access to diverse countries in Europe, Asia, the Americas and the Middle East.
In 2008, two-way merchandise trade between Canada and Peru reached $2.8 billion. Peru is also an important investment partner for Canada, holding Canadian investment stock worth an estimated $2.35 billion at the end of 2008.
CBSA’s Director, Program Division Writes to I.E.Canada…
Following is an extract from CBSA Program Director Claude St.Denis’ recent letter to I.E.Canada president Mary Anderson regarding the current problems implementing a seamless interface between the C-TPAT and PIP security programs:
We understand that industry’s original expectations were that mutual recognition would mean that a company would be able to apply to one and receive membership in both. We believe that this concept between Canada and the U.S. makes sense. Mutual recognition was, however, accomplished with the U.S. in accordance with the World Customs Organization’s SAFE Framework of Standards and the Authorized Economic Operator concept, and how the U.S.’s C-TPAT program wanted to proceed. Under this concept, programs that have reached mutual recognition remain separate and companies must continue to apply for membership into each separate program. Essentially, mutual recognition assures that both countries have similar minimum security requirements, similar site validations practices, and offer similar benefits.
That being said, we have a very strong working relationship with the U.S. Customs and Border Protection (CBP) and its Customs and Trade Partnership against Terrorist (C-TPAT) program. Consultations are ongoing to streamline and standardize the two programs. For example, PIP and C-TPAT are working together to develop a unified site validation report. This will provide a strong foundation upon which to harmonize C-TPAT and PIP.
As mentioned... a critical component of harmonization is the development and implementation of a web portal. To this end, the PIP program recently developed a high level business requirements document leveraging C-TPAT’s web portal requirements. All options were considered, including using C-TPAT’s web portal, and it was determined through this analysis that PIP would be required to develop its own web portal. The PIP program is currently seeking funding for the web portal. Once funding is allocated, industry will be consulted on the design of the portal. At this time, and given that we are seeking funding, we are unable to provide specifics in terms of strategies and timeframes surrounding harmonization.
We have taken note of your recommendation that we immediately harmonize the PIP/C-TPAT application forms. Our automated solution and application processing is dependant on our current application form format. Modifying it would require significant changes to our recently developed system for the PIP program’s modernization. Given the investment required to make these changes, and that harmonization with C-TPAT is potentially on the horizon, and the risks associated with system changes, the CBSA has deemed it preferable at this time to wait until we can build a web portal to develop a unified application. Furthermore, the current PIP/C-TPAT applications, although different in structure, have significant similarities.
Read the complete letter here (PDF).
Saturday, August 1, 2009
Proposed Regulatory Amendments and Proposed New Regulations Related to the Implementation of the Canada-Peru Free Trade Agreement 1. This notice announces regulatory amendments and a new regulation proposed by the Canada Border Services Agency (CBSA) in support of the implementation of the Canada-Peru Free Trade Agreement (CPFTA). It is further proposed that these regulatory amendments and new regulations come into force on August 1, 2009, on condition that the Governor in Council make them.
Proposed Regulatory Changes
Certification of Origin of Goods Exported to a Free Trade Partner Regulations
2. It is proposed that the criteria in paragraph 2(c) of the Certification of Origin of Goods Exported to a Free Trade Partner Regulations be amended to refer to the case where goods are exported or are to be exported from Canada to Peru. It is also proposed to amend paragraph 3(b) of the Regulations to include reference to goods exported or to be exported from Canada to Peru.
Exporters' and Producers' Records Regulations
3. It is proposed that the definition of “advance ruling” set out in the Exporters' and Producers' Records Regulations, be amended to include reference to the advance ruling provision of the CPFTA.
Free Trade Agreement Advance Rulings Regulations
4. It is proposed that paragraph 2(d) of the Free Trade Agreement Advance Rulings Regulations be amended to expand the classes of persons eligible to apply for an advance ruling to include producers in Peru of a material used in the production of goods produced in Peru. With respect to the modification or revocation of an advance ruling, it is proposed that subparagraph 14(a)(vi) be amended to include reference to goods exported from Peru and the provisions of Article 205 of the CPFTA. It is proposed that paragraph 14(b) of the Regulations be amended to include reference to goods exported from Peru and that a new subparagraph be added to that paragraph in order to reference an interpretation agreed to by Canada and Peru regarding Chapter Two or Three of the CPFTA. It is proposed that paragraph 14(h) of the Regulations be amended to include a new subparagraph such that an advance ruling can be modified or revoked in order to conform with a modification of Chapters Two, Three or Four of the CPFTA.
Tariff item Nos. 9971.00.00 and 9992.00.00 Accounting Regulations
5. It is proposed that paragraph 2(b) of the Regulations be amended to include reference to Peru so that proof of exportation of the goods to Peru is required when accounting for the goods under section 32 of the Customs Act.
Refund of Duties Regulations
6. It is proposed that the title to Part 5.1 of the Refund of Duties Regulations be amended to make reference to Peru. It is also proposed that section 23.1 of the Regulations be amended such that Part 5.1 of the Regulations applies to the granting of a refund of duties paid on goods imported from Peru on or after August 1, 2009, and for which no claim for preferential tariff treatment under the CPFTA was made at the time the goods were accounted for under subsection 32(1), (3) or (5) of the Customs Act. It is also proposed that paragraph 23.3(b) of the Regulations, respecting the amount of refund of duties, be amended to include the CPFTA.
Proof of Origin of Imported Goods Regulations
7. It is proposed that the title before section 6 of the Proof of Origin of Imported Goods Regulations be amended to make reference to the CPFTA.
8. It is proposed that subsection 6(1) of the Regulations be amended to require the importer or owner of the goods for which preferential tariff treatment under the CPFTA is claimed, to furnish to an officer, as proof of origin for purposes of section 35.1 of the Customs Act, a certificate of origin for the goods that is completed in English, French or Spanish at the times set out in section 13 of the Regulations.
9. It is proposed that subsection 6(2) of the Regulations be amended to exempt the importer and owner of goods from the requirement of subsection 35.1(1) of the Customs Act if the importer or owner furnishes to an officer, at the time prescribed by paragraph 13(a) of the Regulations, a written and signed declaration, in English or French, certifying that the goods originate in Peru and that a certificate of origin, for the goods, is in the importer's possession.
10. It is proposed that subsection 6(3) of the Regulations be amended to exempt the importer and owner of casual goods for which benefit of the preferential tariff treatment under the CPFTA is claimed from the requirement of subsection 35.1(1) of the Customs Act, if the goods are entitled to the preferential tariff treatment under the CPFTA pursuant to the CPFTA Rules of Origin for Casual Goods Regulations.
11. It is proposed that subsection 6(4) of the Regulations be amended such that the importer and owner of commercial goods for which the estimated value is less than $1,600, and for which the benefit of preferential tariff treatment under the CPFTA is claimed, be exempt from the requirements of subsection 35.1(1) of the Customs Act if the requirements set out in subsection 6(4) of the Regulations are met. It is also proposed to add a reference to Peru in subparagraphs 6(4)(b)(i) and (ii). Proposed New Regulation
CPFTA Verification of Origin Regulations
12. The new CPFTA Verification of Origin Regulations are proposed to implement the verification provisions of paragraph 4 of Article 405 and Article 406 of the CPFTA. The Regulations describe the process to be followed by officers when verifying claims for preferential tariff treatment under the CPFTA. The Regulations also impose an obligation on an officer to send a notice to a producer who failed to record costs in accordance with the Generally Accepted Accounting Principles applicable in Peru. The Regulations describe the notification requirements with respect to the postponement of a verification visit in Peru.
13. As part of our consultation process, the CBSA has posted this notice containing the descriptions of the proposed regulatory changes and new regulations on our Web-site for review and comment. For more information, visit our Web-site at www.cbsa.gc.ca.
14. Inquiries and comments about these proposals should be directed to:
Senior Program Advisor
Origin Policy and Negotiations Unit
Customs Notice CN09-019 Inclusion of Intermediary Locations for Release of Customs Self Assessment (CSA) Shipments
1. Effective immediately, CSA importers can include intermediary locations, as listed on the CSA carriers’ bill of lading, as part of their trade chain partner (TCP) list for delivery of CSA shipments as a consignee. The goods would be consigned to an intermediary location for storage and/or re-distribution to customers in Canada. Release will occur at these locations and the release date will be on the date that the goods were received at the intermediary location
2. During Part II of the importer application process, importers must submit an initial list of their trade chain partners, and are obligated to ensure that the TCP list remain current, and additions and deletions must be provided to CBSA, as per paragraphs 65 and 66 of D Memorandum D17-1-7.
3. The importer is obligated to demonstrate that their system can track and account for goods that are consigned to an intermediary location and determine the release date as the date in which the goods arrived at the intermediary location, prior to adding the intermediary location to their TCP list. The liability will be transferred from the carrier to the importer when proof of delivery (POD) is received from the intermediary location as long as it is listed on the CSA importers TCP.
4. The CSA clearance process will remain as it is today:
a. Importer is CSA approved;
b. Carrier is CSA approved;
c. In highway mode, the driver is registered as outlined in the Presentation of Persons (2003) Regulations; and
d. The goods are eligible.
5. For more information on this process, please refer to D Memorandum 17-1-7 Customs Self Assessment Program for Importers and D-Memorandum 3-1-7 Customs Self Assessment Program for Carriers. Please note that the D memos are currently being updated to reflect this change and should be completed shortly.
6. Any questions may be directed to:
Customs Self Assessment Policy
Commercial Border Policy Division, Admissibility Branch
Canada Border Services Agency
Telephone: 613-941-2713 • Fax: 613-952-1812