Minister Decries Food Fees

(The Globe and Mail)

Industry Minister Jim Prentice is lobbying key members of the U.S. Congress to head off steep new user fees on imported foods that could sideswipe Canadian exports worth billions of dollars.

Mr. Prentice met yesterday in Washington with Michigan Senator John Dingell, who is aggressively pushing a bill that would slap fees on all imports to pay for a food-inspection crackdown.

Food manufacturers have complained that the levies, inspired by concerns about tainted food from China, would unfairly hit Canadian and U.S. companies operating on both sides of the border.

“Canadian products are not the issue,” Mr. Prentice told reporters before meeting Mr. Dingell, the powerful chairman of the House energy and commerce committee.

“We want to make sure that Canadian and American products are not swept up in unintended consequences.”

Canada is the single largest exporter of food and agricultural products to the United States, shipping more than $16-billion worth last year.

Mr. Prentice, who also raised the issue in a meeting with U.S. Commerce Secretary Carlos Gutierrez, suggested the fees are unwarranted because Canada and the United States have a similar interest in managing the risk of tainted food.

“Canadian products ... are not products for which there are concerns about safety,” he added. “Canada and the U.S. have similar concerns.”

A top executive of Campbell Soup Co., which operates plants in Ontario and the United States, complained that Canadian companies would wind up paying 10 times more in fees than China and twice as much as all European countries combined.

Not only is this because of the sheer volume of exports, but some grocery products may contain as many as 20 ingredients and cross the border multiple times before being shipped to stores. Each time an item crosses the border, it would be hit with a fee.

“This is not a good, risk-based approach,” Kelly Johnston, Campbell Soup’s vice-president of government affairs, said yesterday at a conference on Canada-U.S. border issues at the U.S. Chamber of Commerce.

Mr. Dingell’s bill, which has the support of key Democratic leaders in the Senate, would also restrict the entry of food imports to just 13 U.S. border stations, down from the current 300. Mr. Dingell wants to pass his bill before the end of the year.

The exact level of the fees hasn’t been set yet.

The food industry has predicted the bill would cause chaos at the border and unfairly punish companies that have plants on both sides.

Critics have also warned that the measure could run afoul of World Trade Organization rules because the proposed fees unfairly discriminate against imports.

In a speech to the Chamber of Commerce conference, Mr. Prentice warned that border delays are already costing U.S. and Canadian companies billions of dollars a year.

Mr. Prentice said he would work with Mr. Gutierrez to ease border delays and other trade problems through the so-called Security and Prosperity Partnership – a Canadian, U.S. and Mexican initiative to enhance security and boost trade between the three countries.

At a recent summit in Montebello, Que., the leaders of the three countries made “food and product safety” one of five priorities for the partnership.

Complaints about the proposed food-inspection fees were just one of a long list of irritants highlighted by business people attending the Chamber of Commerce event.

Microsoft lobbyist Marland Buckner complained about an “exceptionally challenging trade and immigration environment” in Washington.

He said the software maker, based in Redmond, Wash., recently added jobs at its new research lab in Vancouver, instead of at its U.S. facilities in part because of its inability to get U.S. visas for skilled foreign workers.

Other speakers at the conference complained about a surge in delays at Canada-U.S. land borders this past summer, caused by a host of factors, including inadequate staffing on the U.S. side, computer glitches and stricter screening of trucks and drivers.