Proceedings of the Standing Senate Committee on
Foreign Affairs and International Trade
Issue No. 13 - Evidence - Meeting of November 16, 2016
OTTAWA, Wednesday, November 16, 2016
The Standing Senate Committee on Foreign Affairs and International Trade, to which was referred Bill C-13, An Act to amend the Food and Drugs Act, the Hazardous Products Act, the Radiation Emitting Devices Act, the Canadian Environmental Protection Act, 1999, the Pest Control Products Act and the Canada Consumer Product Safety Act and to make related amendments to another Act, met this day at 4:16 p.m. to give consideration to the bill.
Senator A. Raynell Andreychuk (Chair) in the chair.
The Chair: Honourable senators, today we are starting our examination of Bill C-13, An Act to amend the Food and Drugs Act, the Hazardous Products Act, the Radiation Emitting Devices Act, the Canadian Environmental Protection Act, 1999, the Pest Control Products Act and the Canada Consumer Product Safety Act and to make related amendments to another Act.
We have before us David Usher, Director General, Trade Negotiations, Global Affairs Canada
With us from Health Canada are Kim Dayman-Rutkus, Director, Centre for Regulatory and Compliance Strategies, Regulatory Operations and Regions Branch; and Jason Flint, Director General, Policy, Communications and Regulatory Affairs Directorate, Pest Management Regulatory Agency
And from Environment and Climate Change Canada, we have with us Sara Neamtz, Acting Executive Director, Legislative Governance, Environmental Protection Branch.
We look forward to your presentations. No doubt you followed Senator Black's speech and my speech in the chamber and also the questions that were put by me specifically to Health Canada. I trust that you will be addressing those issues. Welcome to the committee.
David Usher, Director General, Trade Negotiations, Global Affairs Canada: Thank you very much, senator. It's a pleasure for us to be here. I don't need to introduce my colleagues or myself. Thank you for doing that.
I plan to deliver my remarks in two parts. I'd like to give you an overview of the WTO Agreement on Trade Facilitation and its implication and then talk about why Bill C-13 is so important. I take note of your request that we will also try to answer questions raised earlier.
[Translation]
I will also make my remarks in French.
[English]
I would be more than willing after my presentation to answer questions related to the trade facilitation agreement, while my Health Canada and Environment and Climate Change Canada colleagues can respond, as appropriate, to specific questions in that regard.
[Translation]
I would like to briefly tell you about the Trade Facilitation Agreement, or TFA. Trade facilitation is the simplification, harmonization, and standardization of the procedures and measures governing the movement of goods across national borders. In Canada, this covers policies and measures implemented by the Canada Border Services Agency, or CBSA, and other federal departments that operate at the border, such as Health Canada and ECCC.
A lack of transparency, multiple documentation requirements, and lengthy customs clearance processes increase trade costs. By addressing these challenges, the objective of the TFA is to make merchandise trade faster, cheaper and more predictable.
[English]
Simplified trade procedures benefit all traders and generate the most positive effects when all countries enter into this effort. That's why trade facilitation reform is best done multilaterally. In this case, we're doing it by the WTO.
Negotiations for this agreement began in 2004 and ended in December, 2013. This is a major accomplishment for the global trading community and the WTO. The WTO estimates that when the TFA enters into force, it could reduce trade costs by an average of over 14 per cent and boost global merchandise exports by up to $1 trillion. Of that amount, $730 billion of these gains will probably go to developing countries because they are the ones that currently have the highest barriers to trade facilitation.
[Translation]
For Canada, the benefits are expected to be most significant for small and medium-sized enterprises, or SMEs, in export markets. SMEs are not always well equipped to comply with complex customs border requirements when exporting. The trade costs are therefore disproportionately high for them. The TFA will enter into force once ratified by 110 WTO members. So far, 96 WTO members have ratified the TFA, including all of Canada's major trade partners.
[English]
At the G20 leaders' summit this past September in China, Prime Minister Trudeau committed that Canada would ratify the TFA by the end of 2016 along with other G20 members. In this context, we believe it's crucial for Canada to join the international consensus in ratifying the TFA and to do so before the end of 2016 to allow us to deliver on this commitment.
Let me now turn to the legislative amendments, if I may, the link between the bill that we're considering and the trade facilitation agreement.
[Translation]
Canadian border measures are already compliant with the vast majority of TFA provisions. The customs procedures and measures that are applied by the CBSA and other federal departments today are already largely consistent with the obligations under the TFA. However, there are specifically two provisions of the TFA where legislative amendments to Canadian statutes are required for Canada to comply with them.
[English]
The two provisions of the TFA that the bill looks at dealing with are article 10.8.1, which deals with the treatment of non-compliant goods that cannot enter into Canada, and article 11.8, which deals with goods in transit — goods that are going through Canada but are not planned to be sold or used in Canada. Under this bill, amendments are being proposed to six statutes that fall under the responsibility of Health Canada and Environment and Climate Change Canada.
In terms of article 10.8.1, the amendments in the bill that you are examining today are to provide the necessary authority to take action regarding goods that are shipped to Canada but are non-compliant with our technical regulations. So when these goods arrive at our border, they could be returned, re-consigned, seized or disposed of as necessary.
In regard to article 11.8, the amendments in Bill C-13 are to provide the necessary authority to allow Health Canada and Environment and Climate Change Canada to exempt goods in transit from certain Canadian technical regulations. Let me underscore that the goods are not destined to enter commerce in Canada and that measures are also provided to protect the environment and health and safety of Canadians regarding the goods in transit.
If I can give you a little bit of context that may also help in terms of answering questions, when this bill was reviewed in the House of Commons Standing Committee on International Trade, some stakeholders indicated that for the Canadian Environmental Protection Act, CEPA, amendments to that act in Bill C-13 were not necessary as the authority to exempt goods in transit already exists. I should be very clear that this is not accurate. Part 7, Division 1 of the act does not contain the regulation-making authority needed to amend the existing regulations to exempt goods in transit. As such, this is why the amendments to the act are necessary.
I should also underscore that this type of broad regulation-making authority reflected in Bill C-13 is in keeping with the design of the Canadian Environmental Protection Act, which functions as an enabling statute. However, the government has no plans to use the authority other than for exempting goods in transit, and the authority would be available to allow the government to meet future policy objectives other than exempting goods in transit, if needed, to protect the health and safety of Canadians.
Any regulatory change would go through the regular and complete consultation process and all interested stakeholders would be consulted to ensure accountability and transparency. As you are well aware, in Canada consultations for regulatory changes are rigorous and allow stakeholders' views to be heard and addressed as appropriate. My colleagues and I here today are fully committed to continuing this practice.
During second reading in the Senate, questions were raised about the health and safety implications of Bill C-13. The bill will not impact the ability of Canadian authorities to protect either the health and safety of Canadians or the environment. In fact, Bill C-13 provides for measures that will help protect the environment and the health and safety of Canadians regarding the goods that are in transit through our country. It will also clarify and strengthen the authority to deal with non-compliant goods that I referred to earlier more effectively and in a more harmonized way.
I would be pleased to stop here, and my colleagues and I will try to answer any questions that you might have. Thank you.
The Chair: Thank you, Mr. Usher.
Just to start off, it is curious that the description talks about this bill and then says, "and to make related amendments to another Act.'' I have never seen that before. Perhaps it existed before.
Why wouldn't you have named the final act? What it does is deflect from the issue. The question I've been asked is: What is the other act? What is so secretive that you didn't put the title in this bill?
Mr. Usher: I'll turn to my colleague from Health Canada.
Jason Flint, Director General, Policy, Communications and Regulatory Affairs Directorate, Pest Management Regulatory Agency, Health Canada: The other act is the Agriculture Agri-food Monetary Penalties Act. Because you are changing an act which would have penalties that could be levied under the AAMPA, those amendments were being made. It wasn't added to the title of the bill. It was just listed as a related amendment. Because you are changing the Pest Control Products Act, you needed to change the related act that allowed for penalties to be levied.
The Chair: It has always been subsequent amendments or a title. I note that for the record. I already had that, but if we want more people engaged in the process, I think we should be clearer.
If I am correct, this bill does not change health and safety or environment practices, oversight mechanisms, operations or anything. It is geared to the transit of goods. Are you convinced that there is nothing unusual or different when you transit goods at the port than when they are coming in to Canada? Is there a lesser standard of safety or will it be the same process?
Mr. Usher: Goods in transit are subject to controls that are very different than goods that are destined for consumption in the Canadian marketplace. Once goods in transit enter, they are controlled so they do not enter the domestic marketplace. They are entering the Port of Halifax. They are being transshipped through Canada. They are exiting in Vancouver and going to a third country. While they are in transit, their movement is controlled so as to ensure that they do not enter the commercial marketplace.
The Chair: Can you tell me how they are controlled. As an example, do they go on the rails from coast to coast? What are the mechanisms?
Mr. Usher: I can give you a general comment. I can give you more specific details.
You have issues like bonded warehouses where goods enter into bonded warehouses. They are controlled. They do not leave the bonded warehouse without the proper documentation.
CBSA has a lot of responsibility for the control of goods in transit. I can provide you with information on how that specifically is done, but procedures and controls are in place to ensure that they do not enter the Canadian marketplace. It's very different than goods destined for eventual consumption by Canadians.
Senator Eaton: Following on Senator Andreychuk's question, what types of products and to what extent are products transshipped through Canada?
Mr. Usher: I don't think there is a limit to the nature of goods.
Senator Eaton: Are we doing a lot of explosives chemicals? Are we doing a lot of pharmaceuticals? Do we have any idea of what kinds of products are being transshipped?
I can understand "in transit'' because it's like being a passenger in transit in a foreign airport. I can understand that. It would be interesting to know what kinds of goods are being transshipped and why. We are a pretty big country. It seems to me it would cost a lot of money to transship goods across Canada.
Mr. Usher: I don't have details on the nature of goods transshipped. I'm assuming it's a huge variety of goods, everything from soup to nuts, as it were.
Senator Eaton: Shouldn't we know that? That's interesting. Here we are passing this legislation. Shouldn't we have some kind of idea of what goods people transship through this country?
Mr. Usher: Yes, we do have that information. I just don't have it with me here today, unfortunately.
The Chair: Could you provide it to us, the subject matter and type?
Mr. Usher: If I may revert to your question asking about some of the controls that are in place, maybe this will also help to deal with some of the other concerns.
Right now the Customs Act deals with goods in transit and the potential risk that they could be diverted into the Canadian marketplace. The CBSA imposes customs controls on goods in transit to ensure they are not diverted into the Canadian market. I talked about bonded warehouses, for example. They remain under the control of CBSA from the customs office where they enter the country until they leave.
The controls can include the following: There is advanced cargo information that goes to CBSA before the good even arrives. They would probably have data on the nature of goods in transit through these advance notifications. You have the transport of goods by bonded carriers, so the trucks that are locked and sealed and don't get opened in the domestic economy; the transfer of goods to bonded warehouses that I referred to; a customs seal that goes on shipments to say that CBSA has ensured that this is what they say it is; and when the good finally leaves the country, there is a submission of documentation to verify that what leaves is the same as what came in, in terms of the nature of the good and the quantity of the good. So there are controls. They are administered by CBSA under the Customs Act.
I can tell you what products are affected by this bill, per se.
The Chair: Please.
Mr. Usher: It is not the larger universe of goods in transit.
The Chair: Before you answer that, that's the point I was trying to make. We are transiting goods now.
Mr. Usher: Yes.
The Chair: We are now going to do it more universally with regulations. Specifically what does this bill change in that process? If we're worried about all these things being transported, they are being transported now. It's the narrowness of this bill, if you could address that.
Mr. Usher: Sure. In fact the products that are affected by goods in transit are a very small subset of all the goods that transit through Canada at present. This is pretty technical. There are some health products. I don't even know what the example I have here means but my colleague can explain what it is. Sildenafil products, not approved for sale in Canada, will now be permitted to transit through Canada provided that certain conditions are met.
You could maybe explain what a Sildenafil product is.
There are Health Canada requirements that you have to indicate on the shipping container.
Also, unauthorized pest control products would be permitted to transit through Canada, but only if certain conditions are met to deal with product safety information to mitigate risks to health and safety of workers and the environment, and some cleaning products such as laundry detergents, dish washing compounds, household, commercial or industrial cleaners. Some that fall under the bailiwick of Health Canada and some under Environment Canada, but it's a very limited subset of the goods that are currently entering Canada in transit.
The Chair: Dangerous goods, if I can use that term loosely, are transiting through Canada now under certain restrictions, but this bill does not address that. It addresses what you have just said.
Mr. Usher: It's addressing a smaller subset, and the goods that currently go through Canada are dealt with by other bits of legislation that are not affected. We have the Radiation Emitting Devices Act, the Consumer Product Safety Act and the Hazardous Products Act. We are not dealing with those issues.
Would you like to explain what Sildenafil products are? Sorry to put you on the spot.
Kim Dayman-Rutkus, Director, Centre for Regulatory and Compliance Strategies, Regulatory Operations and Regions Branch, Health Canada: I can give you a different example of sibutramine, which is the common name for a drug previously used to treat obesity. It's a pharmaceutical drug. Due to safety concerns, the drug was withdrawn from the market and is no longer legally available for sale in Canada. It was withdrawn because of an increased risk of serious cardiac side effects. A health product that would be presented at the border, adulterated with sibutramine, could now, under this legislation, be seized at the border as representing a health risk to Canadians.
The Chair: I am inferring from that that it's not just the transit; it's the capability of stopping it coming in altogether.
Ms. Dayman-Rutkus: That is correct.
Senator Cools: They are trying to prevent the entry of these goods, which are transiting. They don't want them released into the Canadian marketplace. That's what I understand.
The Chair: Yes.
I have a list of questioners: Senator Black, followed by Senator Downe and Senator Cools.
Senator Black: Thank you very much as well for giving me the opportunity to be before this committee. I appreciate it.
The Chair: Welcome to the committee. It's the first time for you, I think.
Senator Black: I have a quick question. We have a submission, which I presume you have seen, Mr. Usher, from the Canadian Consumer Specialty Products Association. I just want to confirm the point you made in your testimony about their proposal concerning section 118(1.1). You have said that it is not necessary because it is not accurate. Is that what you said?
Mr. Usher: Yes. In terms of that specific item, I'll turn to my colleague from Environment and Climate Change Canada to respond to that, if I may.
Sara Neamtz, Acting Executive Director, Legislative Governance, Environmental Protection Branch, Environment and Climate Change Canada: The regulatory authority that is in Bill C-13 with respect to CEPA is required in order to allow us to amend the current regulation to exempt the products in transit.
Senator Black: Thank you very much. So in your view this proposed amendment, that is to say section 118(1.1), is not necessary?
You have not seen this?
Ms. Neamtz: The amendment in the bill, or an amendment to the bill?
Senator Black: May I show this?
The Chair: I think you would have to show it to the rest of the committee. I guess the point is there will be witnesses — they will be here tomorrow — proposing an amendment. Are you aware of that?
Ms. Neamtz: Yes.
The Chair: I think the question Senator Black is placing to you is this: Is that amendment required? What is your answer?
Ms. Neamtz: The amendment to remove the provision?
Senator Black: May I show this? It's in the package.
The Chair: It's in the package? Okay, thank you.
Ms. Neamtz: This says that the proposed CEPA section 118(1.1) is not necessary.
Senator Black: That is their submission, yes.
Ms. Neamtz: The clause is necessary in order to give us the regulatory authority to amend the current regulation.
Senator Black: That's what I wanted to know. Thank you very much.
The Chair: I am going to ask a supplementary. We are going to have the group before us tomorrow. Did they not come to you and did you not resolve this issue with them?
Mr. Usher: The group that you're referring to did us the courtesy of sharing their proposed language with us, but we haven't had a follow-up discussion with them. I certainly haven't, but I don't know about my colleagues.
The Chair: Did this go through drafting or the Justice Department to determine whether it's necessary or not? Words mean many things to many people.
Mr. Usher: Senator, given that a formal amendment has not yet been proposed, it's difficult for us to comment on something that hasn't yet been formally tabled.
Presumably this group will have the chance to speak tomorrow. If they wish to propose amendments to the group, that can be put forward for the consideration of the senators.
The Chair: My concern is that when we have a community come before our government saying, "We need this,'' there should be a dialogue and some assessment as to whether their interpretation has any weight or not. Now, I'm not getting an answer that you waited it and said "No, it's not necessary.'' You seem to be saying you're not dealing with it unless someone puts forth an amendment. That seems to me to be a slightly different interpretation of governance than I'm aware of.
Mr. Usher: I'll let my colleague speak about the interaction they have had with these stakeholders.
Ms. Neamtz: We did have technical briefings after the bill was tabled in Parliament, and we had meetings with the specific stakeholders to discuss their issues. As Mr. Usher stated in his opening remarks, this issue was addressed also at the house committee. So an amendment was put forward and it was rejected at that committee.
Senator Black: I think we have clarity. I think you have been very clear, Ms. Neamtz, that in your view the proposed amendment is not necessary and in fact would impair your ability to perform the functions you feel you need to perform. That is what I heard you have said.
Ms. Neamtz: Yes.
Senator Black: Thank you.
Senator Downe: Senator Black, I'm not sure on what basis they are making that conclusion, though, following up from Senator Andreychuk. They haven't done an assessment because the amendment has not been before them. They have looked at it, but have you done any research or any analysis? We have heard there has been no discussion with Justice on it.
Ms. Neamtz: Justice drafts the bill.
Senator Downe: I'm speaking about the amendment that Senator Black was just speaking about.
Mr. Usher: In order for us to be compliant with the trade facilitation agreement, these two departments need authorities to take action regarding goods that are shipped to Canada but are non-compliant with our technical regulations. So the amendments in Bill C-13 are needed to give these departments those authorities. Without those authorities, it's not clear that we'll be compliant with our obligations under the trade facilitation agreement.
Senator Downe: Thank you. We'll follow up with the witnesses tomorrow.
You talk about secure transportation and no diversion into the Canadian market. In the last five years, have there been any accidents or mistakes? Have some things that were bonded and being transited through Canada accidentally ended up in the Canadian environment or marketplace?
Mr. Usher: I don't have any specific information on that. I would have to follow up with my colleagues at CBSA.
I don't know if my colleagues from Environment Canada or Health Canada have —
Senator Downe: Chair, I think that's pretty significant, because if some of these items are shipped through Canada and come into contact with Canadians, they could cause health and safety concerns for the workers. They could have an increased environmental impact. We need to know that information.
The Chair: Perhaps you can provide it quickly for us, because it's important. Any act has a risk. We want to know whether we're talking about some risk or little risk. The best way to get at that is to look back over five years and see whether there have been any difficulties we should be aware of.
Senator Downe: Not only if, but how many? Were there 2 or 22 or 222? We need to know that.
Second, could you expand on the request for the timeline for the passage of this bill? Why is it significant that it be passed by a certain date?
Mr. Usher: I would be pleased to answer that question. In terms of the trade facilitation agreement, in my introductory comments I talked about negotiations having begun much earlier, concluding in 2013. It only enters into effect when 110 members of the WTO ratify the agreement. Right now, 96 members have accepted the agreement. There are some remaining members that need to ratify.
There is no specific deadline for WTO members to ratify the agreement. As I indicated, G20 leaders, including our Prime Minister, committed to ratify the trade facilitation agreement by the end of 2016 and called on other WTO members to do the same.
Until it's ratified, none of us benefit from the benefits of the agreement, whether it's our small- and medium-sized exporters that will see their exports facilitated in countries where the customs procedures are complicated, or developing countries looking to trade amongst them. So I think it's important we try to move this ahead.
At this stage, all of our major trading partners have implemented. If I was talking about G20 members who have not yet ratified, there are only four. We have Canada, Argentina, South Africa and Indonesia. There is no opposition to the TFA, and we think it's very important as a strong supporter of the WTO and the rules-based trading environment that we try to move this forward ASAP.
Senator Downe: Thank you for that.
Assuming the other 14 countries come on and you get to 110, there must be variations in the legislation from country to country. They are not all uniform. Have you done an analysis of the G20's legislation versus what is being proposed for Canada and what the variances and differences are? If so, can we have a copy?
Mr. Usher: We haven't done a calculation of the variance, but we can say that Canada, unlike a developing country member of the WTO, is much more compliant with the bulk of the provisions of the TFA already. That's why the Bill C-13 modifications are relatively limited. Our customs procedures are already very transparent. But if you were dealing with a country like Yemen or Sudan, they probably have a much —
Senator Downe: I asked about the G20.
Mr. Usher: No, we haven't done the analysis in terms of G20 compliance.
To get back to your request for information about goods in transit, as I tried to explain earlier, a large universe of goods in transit are already transiting under existing regulation.
In terms of the information that you request, may I suggest that I focus on goods that will be affected by C-13, rather than the larger universe of goods?
The Chair: Yes. As we discussed, that's what I was getting at. We are transiting goods. This bill will not impair it one way or another. I want to know what might be transited or stopped or seized by virtue of Bill C-13 so that we have a better idea about that.
Senator Cools: I wanted to ask the witness if the term for the storage or the safekeeping of these goods in transit is "in bond.'' I remember the bond houses at the port when I was a child. All of a sudden, a lot of language is coming back to me that I haven't thought about for years. So that is the proper term, "in bond.'' Because I used to hear that this is "in bond'' or that is "in bond.''
Mr. Usher: Yes, senator, as I mentioned, you can have a bonded warehouse, which is what we often think of. You can also have bonded carriers; so a truck can also be bonded, where it is sealed and the goods inside don't enter the Canadian market.
Senator Cools: You see, childhood knowledge applied in old age.
Senator Ataullahjan: So this means an increase in products being transshipped. Would the increase pose risks to the environment or even to the safety of Canadians?
Mr. Usher: The short answer is no.
The longer answer is we cannot guarantee that this will lead to an increase of goods in transit. That's going to be a decision based on exporters in other countries who will decide whether or not they want to ship goods in transit through Canada. They could decide to go through the Panama Canal, the United States or Canada. It would be based on a commercial decision of costs. We can't predict the increase, if any, of goods in transit through Canada.
In terms of the specific goods affected by this agreement, there should be no effect on the health and safety of Canadians. I can turn to my colleagues from these two other departments to confirm that.
Mr. Flint: From a Health Canada perspective, there are a limited number of products that would be impacted by this. These are primarily products that have a pre-market approval process and currently have a prohibition against using a product that has not already been approved by Health Canada. That would be things like pharmaceutical products or pesticides. For example, it's prohibited for anybody to import, manufacture or sell a product that has not been registered by Health Canada, assessed by us for its use in Canada and then approved.
This provision for transshipment allows for a product to transit through Canada. What we have looked at mostly is if it were to be allowed, the likely destination would be the U.S. It's a product coming from Asia, let's say, going in through B.C. and being shipped by rail into the U.S. or somewhere on the East Coast. Most of the other product is entering or leaving the U.S., but via Canada is the most likely route we have been looking at.
As I said, pesticides is one of the areas we have looked at, as well as pharmaceuticals. It allows for a product to be shipped through Canada without them having to go through the registration process in Health Canada. We would still have some authority over the product. It's not just a blanket permission to come through the country. We could still put provisions on it through regulation, if we thought that was necessary, to ensure that the products are packaged properly so they wouldn't leak, for example.
We don't require they be labelled for use in the Canadian market. We're trying to eliminate that regulatory oversight. We are not going to be having Canadians use these products. We are simply making sure that they have adequate information and safeguards on these products as they transit through the country.
Senator Eaton: As you know, when you travel to places like Hawaii, they are very careful about insects and certain fruits and vegetables coming into the country, because they don't want to hurt their own crops. In terms of agricultural products being transshipped through the country, do we have special packaging or safety regulations to make sure we don't have bugs or fish sneaking into our ecosystems and destroying them?
Mr. Flint: Currently that would fall under the provisions of the Canadian Food Inspection Agency. They would be responsible for dealing with the border to make sure that we don't have plant pathogens coming in.
Senator Eaton: Let's assume that a big agricultural products or seeds shipment comes in from country X. Do we have regulations to even let it transship through Canada if it's wrapped or contained especially so there is no leakage in the plane, or leakage in cargo or leakage on the train? Can they ship those goods back?
Mr. Usher: Yes, and they are not affected by this bill. We have those procedures in place already. They are not affected in any way by this bill. Again, it's the Canadian Food Inspection Agency working with CBSA that ensures the requirements are met.
Senator Eaton: There are requirements. That's what I'm asking.
Mr. Usher: Yes, very much so.
We want to give Environment and Climate Change Canada a chance to respond to the question posed earlier.
Ms. Neamtz: With respect to the amendment under the Canadian Environmental Protection Act, the products we are talking about are cleaning products such as laundry detergent, dishwashing compounds, household commercial or industrial cleaners that contain phosphorus. Phosphorus is not considered a CEPA toxic. It's a nutrient commonly found in the environment. The purpose of regulating it is to reduce the amount of phosphorus going down our drains and reaching our waterways.
The likelihood of a spill of these products in transit is low. If such a spill were to happen, it would not be a significant risk to the environment. They are packaged in very small quantities.
Senator Oh: Besides detergent, are there any more dangerous goods coming through? Do we charge a special fee or levy during the transit?
Mr. Usher: There are other goods that come through. They are dealt with under various existing legislation. There may well be special requirements for certain goods, but I'm not sure you could charge a separate levy because then you're sort of discriminating. How do you discriminate between products from one country verses another?
There are technical requirements for all goods that are in transit, and that depends on the nature of the good.
Senator Oh: But if we allow dangerous good to come to Canada, why don't you levy a special fee? Otherwise all these goods will come through here, and one incident will cost us a lot of money to clean it up.
Mr. Usher: Let me see if either of my colleagues have comments to add on that question.
Mr. Flint: Generally when you're talking about dangerous goods, there is the Transportation of Dangerous Goods Act and regulations that Transport Canada administers which are designed to address things like the potential for spills. So they have emergency response plans and things like that. They are required for products that meet the definition of a dangerous good. That exists now, and is applied for products that are coming through.
I'm not aware of any fees that Transport Canada or the CBSA may levy for that. But there are protections in place already to address concerns around the transportation of dangerous goods.
Mr. Usher: Those requirements could include special packaging requirements, et cetera.
The Chair: You have already explained the regulations they may have, such as a special package. Those are the compliances and provisions. I think the question was is there any special levy, per se? "You must meet this; you must package it this way; it must be contained this way; you have to move it in so many days.'' I think you are saying that there is then a risk factor. It's almost like a fund set aside. Is there such a thing? If you could get us the answer, that would be great.
Mr. Usher: We'll do our best. Certainly it's outside the purview of Bill C-13.
The Chair: I understand that, but the question is to help us understand that whole transport concept and to put this bill in perspective.
Senator Oh: If I'm a shipper, I could walk away if the value of cleaning up cost more than my goods. I would just simply forget it.
Senator Black: This is hypothetical. If the Government of Canada were going to levy a special fee for dangerous goods in transit, would that be off side the trade facilitation agreement?
Mr. Usher: I would have to do a little bit more thinking on that, because there are also other WTO obligations. There is the Technical Barriers to Trade Agreement.
Let me give you a facetious example. If somebody said, "I'm shipping ping-pong balls through Canada,'' and a malicious authority said, "Well, ping-pong balls can be dangerous if a child swallows them, so you have to pay $10,000 to ship this through Canada,'' that would be an effective barrier to goods in transit.
Senator Black: That is my question.
Mr. Usher: I would have to follow up with my colleagues to see about implications of other trade-related agreements in the WTO. It certainly runs counter to the intent of the agreement in trade facilitation.
Senator Black: Thank you very much.
The Chair: If I understand, there can be provisos that they must carry insurance, et cetera.
Mr. Usher: Or be bonded.
The Chair: It's a levy by another means, which is an acceptable type of levy, if I can put it that way; is that correct? Nods don't work on our record.
Mr. Usher: Yes, the agreements allow you to take the necessary measures to protect the health and safety of your citizens. You just need to ensure that the measures you are taking are in fact proportionate to the risk that you're dealing with, to ensure that you don't have a situation where somebody is using it as a de facto trade barrier.
The Chair: This bill started out as trade facilitation and spent many years in the WTO. Our interest in this was to get our goods transported through other ports and, to be quite honest, to cut down on the corruption that occurs at customs and excise ports. You say that we have to amend two minor clauses. But the enthusiasm of this bill is the fact that other countries will have a lot more to amend to be compliant, and it may not be the first 110 that sign on. It may be those others that we will be reaching. Am I correct in my assessment that this will encourage other countries to be more transparent and to reach the standards that we are probably ahead of?
Mr. Usher: Yes. The modification in this bill, in terms of bringing Canada into compliance, are relatively small compared to what some other WTO members will likely have to do. So to a great extent we are bringing them up to our level of efficient customs clearance procedures.
If I look at countries that have already ratified, it includes countries like Samoa, Zambia or Ukraine. I'm assuming many of those countries have had to make significant legislative changes to bring themselves into compliance. The good news is that as a country like Sri Lanka, for example, improves its customs procedures, Canadian exporters, especially small- and medium-sized companies, will really benefit because they don't have the luxury of hiring customs brokers or lawyers to deal with challenges in some of the developing country markets. So getting countries in the WTO to agree to these good principles is a real benefit for our commercial sector.
Senator Housakos: Can you give us an example of how the provisions in Bill C-13 will affect goods in transit and how those goods have been treated under the existing legal authority?
Mr. Usher: Would you like to hear from both of the departments?
Senator Housakos: Please.
Mr. Flint: As I explained before, the bill only applies to a limited number of acts for Health Canada. It would be the Pest Control Products Act, for example, so pesticides is one. Currently you're not allowed to import a pesticide unless it has been already assessed and registered by Health Canada.
Bill C-13 will change that and allow for product to be transshipped through Canada. This may occur, for example, for products that might be coming through Canada destined for the U.S. It should not have a significant impact on us from a Canadian perspective as far as transshipping our products through Canada.
Similarly, pharmaceutical products could be transshipped through Canada, probably destined to the U.S. They would be U.S.-approved products, either entering or leaving the country.
The third area is radiation emitting devices. This could be things like x-ray machines, tanning beds, microwave ovens, anything that falls under that legislation.
Ms. Neamtz: From the perspective of Environment and Climate Change Canada, right now cleaning products such as the detergents we're talking about are prohibited from being imported into Canada, which includes in transit, unless they meet the regulations.
Since the regulation was expanded in 2009 to include these cleaning products, there haven't been any "in transit'' requests for those products that we're aware of.
The Chair: Thank you for coming forward and answering our questions. Those that have yet to be answered, perhaps you can provide us some information.
(The committee adjourned.)