Proceedings of the Standing Senate Committee on
Foreign Affairs and International Trade
Issue No. 13 - Evidence - Meeting of November 17, 2016
OTTAWA, Thursday, November 17, 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 10:44 a.m. to give consideration to the bill.
Senator A. Raynell Andreychuk (Chair) in the chair.
[English]
The Chair: I apologize to both the witnesses and senators that we were delayed due to the fact that another committee was continuing in this room and it took us some time to clear the room and get ready for our own session.
I welcome the witnesses to this meeting of the Standing Senate Committee on Foreign Affairs and International Trade. The committee will continue to hear witnesses today in relation to the 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. This is all to do with the WTO Agreement on Trade Facilitation, portions of which we in Canada need to amend our acts so as to be in compliance with the agreement and be in a position to sign up with the WTO.
We were told yesterday by officials that, substantially, our rules are in compliance but that this act covers the areas that need to be changed to be in conformity or to adhere to the trade facilitation agreement, as agreed to at the World Trade Organization.
Today we have before us Ms. Shannon Coombs, President of the Canadian Consumer Specialty Products Association; and from CropLife Canada, Mr. Pierre Petelle, Vice President, Chemistry, and Mr. Dennis Prouse, Vice President, Government Affairs.
Welcome to the committee and thank you for your request to come forward and be here today.
I'm going to turn to Ms. Coombs first. I'm sure you understand our process, as you've testified before. You will give opening remarks and then we will go to questions. We will hear from both presenters today before we go to the questions.
Welcome to the committee.
Shannon Coombs, President, Canadian Consumer Specialty Products Association: Good morning, Madam Chair and senators. It's a pleasure to be here today to provide our perspective to the committee's review of Bill C-13.
I'm the President of the Canadian Consumer Specialty Products Association. For 18 years, I have proudly represented the many accomplishments of this proactive and responsible industry.
Today, I have provided our one-pager entitled "Imagine Life Without Us,'' which illustrates the types of products that CCSPA represents. I'm sure many of you have used them here today.
CCSPA is a national trade association that represents 35 member companies across Canada. Collectively, it is a $20 billion industry and directly employs 12,000 people in over 87 facilities. Our companies manufacture, process, package and distribute consumer, industrial and institutional specialty products such as soaps and detergents, domestic pest control products, aerosols, hard-surface disinfectants, deodorizers and automotive chemicals — as I call it, everything under the kitchen sink.
Our ingredients, often the end use of the product, as well as the labelling are all regulated under the appropriate legislation and regulations. This is both for consumer use and the work place.
Some of you may recognize our association, as we distributed the "William, Won't You Wash Your Hands''education kits to your offices in September as part of our handwashing education campaign. CCSPA and the Canadian Institute for Child Health asked you to donate these kits to childcare facilities in your communities. Handwashing is the most important activity that can be done to prevent infectious diseases.
Why are we here today? Bill C-13 amends six pieces of legislation to meet our trade obligations under the WTO's Agreement on Trade Facilitation. Five of these acts impact the members of CCSPA. Those pieces are the Food and Drugs Act; the Hazardous Products Act; CEPA, the Canadian Environmental Protection Act, 1999; the Pest Control Products Act; and the Canada Consumer Product Safety Act.
CCSPA and our member companies support the World Trade Organization's Agreement on Trade Facilitation. However, we have a concern about a potential unintended consequence from one of the amendments drafted to ensure that Canada meets our obligations for the provision of in-transit goods. We believe it is unnecessary, as it expands the scope of the current law.
During our appearance before the House of Commons Committee on International Trade, we proposed two amendments that we believed would ensure predictability in the Canadian marketplace while meeting our trade obligations under the WTO. These amendments were to the Pest Control Products Act and to the Canadian Environmental Protection Act.
While the final outcome was different than our initial proposal, CCSPA and our colleagues at CropLife Canada were pleased that the House of Commons Committee on International Trade accepted our rationale to amend the originally proposed changes to the definition of "label'' under the Pest Control Products Act. Without the amendment, it could have led to unintended consequences, impacting our business in Canada beyond allowing for in-transit goods. It was a collaborative effort between stakeholders, government officials and parliamentarians that resulted in the bill being unanimously amended.
I would like now to discuss the proposed amendments to CEPA. CCSPA member companies provide products that improve the lives of Canadians, and CEPA governs the ingredients in our products, both existing and new substances.
Through the current sections 117 and 118 of the Phosphorus Regulations of CEPA, we have clear laws about what is permissible, and we comply. The rules are very clear. It is our opinion that proposed CEPA section 118(1.1), which could be used to create a blanket exemption, is not necessary and could cause confusion by implying that a regulation could be written to currently exempt illegal products from Canadian law.
The stated goal of Global Affairs Canada is to be able to specify regulations allowing import for export of in-transit products not saleable in Canada, as needed under new trade requirements. However, while officials stated otherwise during their testimony yesterday, we believe this ability is already in place in Division 1, Part 7 of CEPA. There is only one regulation under the nutrient section of CEPA, and it is the one limiting phosphorus in our cleaning products, which is a regulation that was based on our industry-led initiative to reduce phosphorus in household automatic dishwasher detergent to a maximum of 0.5 per cent by weight.
To meet our trade obligations, the nutrient regulations under section 118 can be amended to accommodate "import for export'' of in-transit products. Environment and Climate Change Canada has confirmed with CCSPA that such a regulatory amendment would be necessary. In our opinion, the focus should be on amending the regulations and not creating an unnecessary and confusing amendment in CEPA.
We understand that timely passage of this legislation is key to meet our international obligations. However, we want to get it right.
We listened intently to yesterday's presentations and the questions of the senators. Yesterday did not result in a clear and specific answer from Environment and Climate Change Canada on how they will ensure that the provision is only used to facilitate the movement of in-transit goods and not to supersede Canadian regulations. There was a statement that the intent was only to use these provisions for in-transit goods. However, in the future it could be used to make regulations for health and safety reasons. This is our concern.
This last statement goes beyond the scope of the intent of the bill, which is to facilitate trade. Our concern remains the potential misapplication of the exemption beyond the purpose of "in-transit.''
While yesterday's testimony has provided clarity on the intent of the amendment, we still believe there is a need to limit its scope. Therefore, we would suggest that the provision be amended by adding the words "for the purpose of in- transit goods'' at the end of proposed section 118(1.1).
In conclusion, I would like to reiterate our support for the intent of the WTO Agreement on Trade Facilitation and Canada's participation in it. We believe that with the amendment we are proposing we can get the legislation right.
Thank you for your time today, and I would be pleased to answer any questions you have.
The Chair: Thank you, Ms. Coombs. Who is going to present on behalf of CropLife?
Dennis Prouse, Vice President, Government Affairs, CropLife Canada: I will, Madam Chair. I'm Dennis Prouse, Vice President of Government Affairs with CropLife Canada. With me is my colleague Pierre Petelle, Vice President of Chemistry with CropLife Canada. Pierre is here to answer all the hard questions that may follow afterwards. We greatly appreciate the kind invitation you and your fellow committee members have extended to us today.
CropLife Canada is the trade association representing the manufacturers, developers and distributors of plant sciences innovations, including pest control products and plant biotechnology for use in agriculture, urban and public health settings. We are committed to protecting human health and the environment and providing a safe, abundant food supply for Canadians. We believe in driving innovation through continuous research.
CropLife Canada is a member of CropLife International, a global federation representing the plant science industry in 91 countries.
Our mission is to enable the plant science industry to bring the benefits of its technologies to farmers and to the public. Those benefits manifest themselves in many different forms, including sustainability, innovation, driving agricultural exports, job creation, strengthening the rural economy and increased tax revenue for governments.
Canada is a trading nation, and in no other sector is that more true than agriculture. Canada enjoyed a surplus of close to $12 billion in agri-food trade in 2015. This is very positive not only for the Canadian economy but for the leadership role that Canada can play in feeding a growing world population.
Across Canada, nine out of every ten farms are dependent on exports. This represents 210,000 farms and includes a majority of farms in every province. Canada's food processing sector employs a further 290,000 Canadians. Agriculture is a tremendous avenue for future Canadian trade growth.
It is for this reason that Canada must remain a strong and reliable partner in the World Trade Organization. Indeed, in an increasingly turbulent and difficult global environment, Canada must more than ever play a leadership role as a nation adhering to science-based regulation and liberalized rules-based trade.
It's for those reasons as well that CropLife Canada and its member companies support the broad aims of Bill C-13, to bring our laws into compliance with World Trade Organization standards. We are also very appreciative of the flexibility shown by the Government of Canada and their willingness to work with stakeholders, when we raised technical concerns about the wording in one part of Bill C-13.
Bill C-13 amends six pieces of legislation, one of which is the Pest Control Products Act. This is obviously a vitally important act for many of our member companies.
We met with officials from Health Canada's Pest Management Regulatory Agency in July 2016 to discuss our concerns related to the Pest Control Products Act amendments contained in Bill C-13. Along with our colleagues at the Canadian Consumer Specialty Products Association, we also made a presentation to the House of Commons Standing Committee on International Trade on October 4, 2016.
As mentioned, we strongly support the World Trade Organization's Agreement on Trade Facilitation. It was our view, however, that some of the amendments drafted to ensure that Canada meets our obligations for the provision of in-transit goods may have inadvertently expanded the scope of the current law. We proposed amendments that would ensure predictability in the Canadian market place while meeting our trade obligations under the World Trade Organization.
We were pleased that we were able to work with government officials and the members of the House of Commons Standing Committee on International Trade in a very collaborative way to address these issues. The committee accepted our rationale to amend the originally proposed section 33(1), which changes the definition of "label'' under the Pest Control Products Act. As a result of the amendment passed by the committee and ultimately adopted by the House of Commons, the bill now meets our trade obligations without increasing the scope of the definition of "label'' for the domestic industry.
To conclude, Madam Chair, we are strong supporters of free and open trade around the globe, and we are appreciative of the efforts of governments both past and present to grow and protect those vital trading opportunities for Canada. We were pleased by the flexibility and responsiveness shown by the government and parliamentarians to our technical issues with Bill C-13.
I thank the committee for its time and we would welcome any questions.
The Chair: Thank you, Mr. Prouse.
I will turn to Senator Black first for questions.
Senator Black: Thank you both very much for your presentations this morning. They're very helpful.
As you can tell, Madam Chair, there is an honest discussion going on about whether or not a further amendment is necessary. You heard the witnesses yesterday indicate that, no, that would handcuff us, and we're hearing today that the Canadian Consumer Specialty Products Association wishes to continue to advance that conversation. Discussions late yesterday afternoon were unable to resolve that impasse.
What I would suggest, Madam Chair, for your consideration is a memorandum that I have here prepared by Global Affairs Canada, which I could distribute to the committee, and we could make, if appropriate, representatives from Global Affairs Canada and Health and Environment available again to talk specifically to this issue of a proposed amendment and why Global Affairs Canada at all feels it handcuffs them. With your consent, I could distribute this memorandum and then at your will, if you wish to recall the folks, they're here and available to speak to the memorandum.
The Chair: It's certainly the will of the committee. Is your memorandum in both official languages?
Senator Black: Unfortunately, it is not.
The Chair: Of course, since you're not presenting it as a senator, you're presenting it as a government document, it has to be in both official languages. That's one conundrum I have.
As I understand it, the difference is that the government's position is that this bill covers only in-transit goods, and therefore the act itself deals with that and doesn't expand to other trade. Ms. Coombs is putting the alternative position forward that it could, by regulation and its generality, stretch beyond transit at some later date.
Senator Black: That is the issue.
The Chair: My proposal would be, as the proponent of the bill, that those discussions can continue.
Have the drafters looked at this and are they satisfied that it is contained rather than expanded?
The minister is coming, and we're waiting to find out when. The officials should come with her. My proposal was going to be that either she or the officials should address that issue. But it should be looked at it not just with an opinion from Environment Canada but also from a judicial point of view and an interpretation point of view. I will use the Legal and Constitutional Committee as an example, which often draws on the differences of opinion, and we need the clarification that departments can give.
Senator Black: Absolutely. That's a brilliant suggestion actually.
The Chair: If there is agreement to that, I would suggest that the memo be translated and provided to the committee over the weekend. I would think we would have time. We can continue the debate and maybe probe Ms. Coombs further on her position and any other issues.
Senator Black: That's a wonderful suggestion. Thank you very much.
The Chair: Is the committee in agreement with that direction?
Senator Downe: I'm just wondering if Ms. Coombs can tell us if her amendment came from legal advice as well or directly from the association.
Ms. Coombs: It came directly from the association. We did ask the departments last night, when Senator Black graciously offered to have us all convene, and had the discussion about what was the legal opinion to not include in transit goods.
I look forward to your suggestion, Madam Chair, of having a further discussion on that, because I think it would be very helpful if we could understand why we can include those few words in there to ensure clarity in that particular amendment.
Senator Downe: Chair, your suggestion is excellent. I am just wondering, when everyone comes back with their opinion, should we also have Ms. Coombs or someone from her association here, in case they have any objection to what is being said, that it's erroneous or wrong?
The Chair: Ms. Coombs has been helpful, as has Mr. Prouse. They have followed this. They have embraced this issue very responsibly by dealing with the government. The invitation is certainly open to return, but I don't want to put them in a compelling position, if they feel satisfied with what happens. It's your decision, but you're very welcome to come back and add anything.
Ms. Coombs: We would be most pleased to participate. Thank you, Madam Chair.
The Chair: As I understand it, there is not a difference on intent. It's the difference of opinion on interpretation of the actual wording in the bill.
Ms. Coombs: Yes.
The Chair: Are there any other comments from our witnesses?
I'll pick up on a few points. We had some discussion that we have been transiting goods through Canada under other means. We have other acts, and we understand that these trade facilitation discussions have gone on a long time in the World Trade Organization. Just to fill out our understanding, I'm wondering about two areas. We have been told that we meet the standards of this WTO agreement but for what is in this bill. Are you satisfied that our other arrangements that aren't covered here, because we have already met the WTO standard, are sufficiently high, or are there some things we could improve in the broad transmission of goods either into Canada or through Canada? Since both of you are involved in this area, we want your expertise.
Ms. Coombs: Thank you, Madam Chair, for the question.
I believe yesterday there were very good examples provided by the officials of how we do have a robust regulatory system around the transportation of dangerous goods. There were some concerns raised by senators at that point.
While there is always room for improvement, we have very robust systems in place to help allow for in-transit goods. This bill does bring those six acts from Health Canada into compliance. I think that's going to be very beneficial that we have those robust processes.
Pierre Petelle, Vice President, Chemistry, CropLife Canada: From a pest control products point of view, there isn't very much manufacturing done in Canada of pest control products. A lot of it is done in the U.S. and in Europe. That said, with the prohibition to transit products in Canada, that was never feasible for our industry. We're not really sure what the uptake will be in terms of whether there will be an increase in products coming in, for example, through Canada to the U.S. We don't have an assessment of that.
To answer your question, we have not identified any other roadblocks or issues that prevent us from freely trading our products. These are highly regulated products. We're in very tight boundaries in terms of what we can and cannot do, but we haven't identified any trade-inhibiting issues that we would have liked to have addressed.
The Chair: My other question is actually a follow-up to what you just said, Mr. Petelle.
Part of the reason for the World Trade Organization is to bring many countries up to a standard that we have or aspire to. It was stated that perhaps that would increase our trade capabilities, particularly in small- and medium-sized businesses. Have you spent any time addressing the new opportunities that this may provide for you in dealing with countries other than the U.S.?
Mr. Petelle: From CropLife Canada's perspective, we don't have those figures. We do have trade-related issues globally that we would like to be dealt with, but I don't think they are really in the scope of this discussion. We haven't done any detailed analysis to see if new routes will open through different countries with these changes, for example. That analysis hasn't been done.
The Chair: The reason I raise that is this committee is studying trade in a general way, and we have had many witnesses. We have looked at trade agreements, but we have heard from many witnesses that trade agreements are one issue and that there are so many other things — innovation, other agreements and attitudes, political will — that make us successful or not in the business of trade.
We were told that this could be an enabler for us. This is why I was asking whether you have contemplated that. It's an encouragement to think about whether this bill will in any way be of some benefit down the line.
Mr. Prouse: Senator, we looked at Bill C-13 from a technical point of view, as I addressed earlier. But you're absolutely correct: I referenced science-based regulation in my opening presentation not by accident. Tariffs are one thing, but when you look globally at what the barriers to trade tend to be now, they tend to be regulatory. They tend to be non-science-based regulations globally that now start to impede Canadian trade.
That's why it's vital that Canada be a strong participant at the WTO, have strong bilateral and multilateral trade agreements that specifically address science-based regulation and non-tariff trade barriers because those are what will be impediments. Nowhere are those more visible than in agriculture.
Absolutely, that's a discussion we are very pleased to have with any parliamentarian who wishes to listen.
Senator Downe: As a follow-up to the point you made earlier about the organization of the bill, I'm sure Senator Black made note of the various questions asked yesterday. Obviously we need answers to those before we consider the vote on the bill, so the sooner we get those the better.
Have any of you compared this legislation to what has been done in other countries to meet the requirements of the WTO? I appreciate that the rules are different country by country, but I'm particularly interested in other G20 or G8 countries. How does our legislation to meet the requirement line up with theirs?
Ms. Coombs: We have not done that analysis, senator.
Mr. Petelle: We haven't done a detailed analysis either, but from the Pest Control Products Act point of view, this was a specific prohibition in our act. Whether or not similar prohibitions existed in other countries, I'm not aware. This is removing a prohibition that wasn't necessary. For Canada's point of view, it was just to address that particular trade-inhibiting provision.
When you look at our partners, the G8 members you mentioned, we are all under very similar but slightly different regulatory regimes for pesticides. The requirements for how to register, how to label and the data requirements are very specific to pesticides. The data requirements and the obligations are quite heavy and onerous, so any limitations like this that prevent movement, we're happy to see those changes happen.
The Chair: I see no other senators wanting to ask questions. I feel that I am more a teacher than a chair today because I'm sending everyone home with homework.
Senator Black, you will follow up.
Senator Black: I got my list, yes.
The Chair: And as Senator Downe pointed out, the officials have undertaken to give us further information based on the questions we posed. Hopefully we can re-convene, hear the minister, the officials and anyone else interested in adding to their submissions.
Thank you, senators.
And thank you, witnesses, for your efficiency in getting your points across so quickly.
Senator Downe: I'm sorry, but do we have a copy of the proposed amendment?
Ms. Coombs: It was in our submission, senator.
Senator Downe: Good. Thank you.
The Chair: We have asked for leave to sit on next Tuesday. The Senate has not dealt with that issue, so you'll have to wait until the notice comes. I cannot announce the time of the next meeting. We will adjourn until further notice.
(The committee adjourned.)