October 21, 2011

News from Thompson Ahern: Weekly Updates

An updated list of recently published government memorandums, notices, regulations and decisions for the week ending October 21, 2011 is now available on our website here.

Ottawa Slammed for Missed Trade Opportunities in Asia

(CTV)

Ottawa has dropped the ball on trade opportunities in Asia, developing a reputation as a player that shows up but isn't serious about the game, according to a new report.

Dr. Wendy Dobson, of the Institute for International Business at the University of Toronto's Rotman School of Management, authored the report on behalf of the Canadian Council of Chief Executives and the Canada China Business Council.

“Canada has a reputation in Asia of showing up there but not being serious about establishing long-term relationships,” states the report. “This was not always the case.”  In the past, Dobson writes, Ottawa built strong, lasting trade relationships with Japan and China, and contributed to aid programs in developing economies such as India, Malaysia and Thailand.

That strategy has been replaced by a piecemeal approach, she wrote, noting that Canada has also distanced itself from the discussion around political security, which is damaging to traditional trading partners such as Japan. Read more here.

Thousands of Canadian Great Lakes-Seaway Jobs Threatened by N.Y. Rule: Study

(Ross Marowits — The Canadian Press)

Thousands of Canadian jobs are threatened if New York state sticks with plans for tougher new ballast water standards that could choke off trade through the St. Lawrence Seaway, says a study released Tuesday. The industry-sponsored study suggests that the new rules could cause Canada to suffer three-quarters of 72,000 jobs lost along the 3,700-kilometre Great Lakes and St. Lawrence Seaway network.

More than $2.5 billion in employee income, $8.6 billion of business revenues and $1 billion of taxes would also be at risk in Canada if all traffic through the state is halted by new regulations set to take effect in 2013.

The St. Lawrence Seaway Management Corp. and its U.S. counterpart argue that the New York regulation is "technologically unachievable."  It said a U.S. Environmental Protection Agency evaluation in July concurred. But Judith Enck – the top EPA official in New York who helped draft the New York rules when she worked for the state – recently told U.S. media that the regulations are designed to spur development of new technologies.  Implementation of the regulations was delayed 20 months because the technology doesn't yet exist.

The rule will require all ships transiting the waters to install treatment equipment to sterilize ballast water that is 100 to 1,000 times international standards. Read more here.

The Import of Capacity

(Export Development Canada – Peter G. Hall)

It takes teamwork to build an economy. Economic development plans at the local, regional and national level play a key role. Over the years, much has been written and myriad plans have been implemented by economic developers. Does all the economic transformation we have seen in the past 20 years in any way change the shape of modern economic development?

Historically, development programs have focused on encouraging domestic investment, attracting foreign investment, creating hubs of activity, building export-oriented business capacity, targeting cool new niche industries, trying to increase value-add in traditional industries, diversifying on a number of fronts – the list goes on. The initiatives are noble, although generally mercantilist in nature, and have yielded good results where intelligently implemented. Is this the appropriate model for the future? Read more or watch the video here.

October 20, 2011

Ready or Not, Here Comes FDA’s Unique Device Identification Initiative

(CMIO)

Will the FDA’s Unique Device Identification (UDI) initiative force hospitals’ clinical engineering departments to give up their existing inventory-tagging systems? That was one of several questions taken up by an FDA official, an industry expert and a clinical engineering specialist at an Oct. 18 webinar sponsored by the Association for the Advancement of Medical Instrumentation (AAMI).

AAMI organized the session in advance of FDA’s draft regulation offering guidance on implementing the standardized, globally harmonized, barcode-like identification system. The draft is expected this fall. After a comment period, a new FDA rule will require manufacturers to affix a UDI tag to all devices so they can be tracked throughout their lifecycle in the healthcare system.

The participant who asked about hospitals’ existing tracking systems, Jim Bosman, a clinical engineering financial specialist at Baystate Health in Springfield, Mass., expounded on his question. “Is any consideration being given to placing these labels in such a way that they’ll be easily accessible? Sometimes these serial numbers are on the back or somewhere a machine is installed and you have to pull it out from the wall to see the serial number,” he said. “I guess I’m just wondering if the FDA is considering these issues. I doubt the industry is bringing these considerations forward; it’s got to be coming from hospitals.” Read more here.

October 19, 2011

North American Freight Index Holds Steady

(International Freighting Weekly – Kizzi Nkwocha)

Rates for U.S. haulage increasing slowly

TransCore’s September North American Freight Index rose 3.2% on August and 45% compared with September 2010. The company said last month marked the highest same-month spot market freight availability since the aftermath of Hurricane Katrina.

TransCore’s monthly North American Freight Index reflects spot market freight availability on the company’s network of load boards in the U.S. and Canada.

Alongside the increase in spot market freight volumes, truckload freight rates rose in September for all equipment types.

National average rates increased 2.3% for dry vans compared with August and 3.9% up on September 2010, excluding fuel surcharges. Reefer truck rates were up 1.3% on August, and 2.1% up on last year. Flatbed rates were stable month-on-month with a 0.6% increase, but gained 10.2% year-on-year due to high demand.

International Trade Minister Ed Fast Visits Washington to Promote Vital Importance of Canada-U.S. Trade and Defend Canadian Interests

(DFAIT)

In these challenging economic times, there is no better American job-creator than trade with Canada and vice versa, says Minister Fast

The Honourable Ed Fast, Minister of International Trade and Minister for the Asia-Pacific Gateway, today concluded a productive two-day visit to Washington to reinforce the vital importance of a strong Canada-U.S. relationship that benefits Canadians and Americans alike. His trade visit to Washington included talks with his counterpart, United States Trade Representative Ron Kirk, as well as other government officials.

“History shows that deeper and stronger trade ties are key to the global economic recovery. Free and open trade ties between the U.S. and Canada are fundamental to improving the prosperity of Americans and Canadians alike,” said Minister Fast.

“Our government’s top priority is to create jobs, increase prosperity and protect and strengthen the financial security of Canadians. Broadening and expanding access to the U.S. market is a key part of our government’s job-creating, pro-trade plan.”

In their face-to-face talks, both Minister Fast and U.S. Trade Representative Kirk expressed the view that strengthening the Canada-U.S. friendship will bring greater prosperity to both countries, and that in these challenging economic times governments must work together to address common challenges.

“The importance of the Canada-U.S. trade relationship, and the jobs and prosperity it supports on both sides of our shared border, couldn’t be clearer,” said Minister Fast. “All told, the jobs of over eight million Americans depend on trade with Canada, just as over two million Canadian jobs depend on trade with the U.S.”

Minister Fast met with Senator David Vitter, Ranking Member, Transportation and Infrastructure Subcommittee, Senate Committee on Environment and Public Works, and Senator John Thune, Ranking Member, Subcommittee on International Trade, Customs, and Global Competitiveness, Senate Committee on Finance.

Minister Fast also met with leaders of U.S. business associations, including the Coalition of Service Industries, the U.S. Chamber of Commerce, the National Foreign Trade Council, the American Farm Bureau Federation and the Canadian American Business Council, as well as the Washington representative of Canadian Manufacturers & Exporters.

“I look forward to a sustained engagement with our American friends which will continue to help long-term prosperity and economic growth to our countries’ mutual benefit,” concluded Minister Fast. “In my meetings here in Washington, our American friends and I shared the sentiment that we must do our part to ensure that the Canada-U.S. relationship, which is the envy of the world, gets even stronger as we go forward together in these challenging times.”

About $1.8 billion in goods and services cross the border between Canada and the United States every day, or about $1.2 million every minute. Over 4,500 Canadian-owned businesses in 17,000 U.S. locations directly employ over half a million Americans.

October 18, 2011

CME and Its Members Push for Border Processes to Support Competitive, Integrated Manufacturing

The following statement was issued by CME President & CEO Jayson Myers:

Earlier today, CME hosted a members-only roundtable with US Customs and Border Protection Commissioner Alan Bersin to push for streamlined and harmonized processes for the movement of goods and people across the Canada-US border.

While Canada and the United States enjoy the most robust trading relationship in the world, we don’t simply trade with each other; we build things together. Our manufacturers complete globally together. We are each other’s most trusted and secure trading partners. At the same time, over the past decade, each of our countries have introduced a myriad of complex regulatory and security barriers at the border that have substantially increased the cost and uncertainty of shipping people and goods between our countries.

We constantly hear from our members right across the country about the challenges, uncertainties, and costs associated with crossing the Canada-US border. Companies have become frustrated with the lack of benefits available to those that have partnered with governments in low-risk trusted trader programs; the lack of coordination and the amount of duplication between government departments on reporting requirements; and, the overall difficulty and ever-changing requirements faced by business travellers.

Today, with the integration of our industry across North America, border delays and regulatory hurdles cost industry in Canada and the US an estimated three per cent of the total transaction value of trade between our countries, or more than $13 billion annually – costs which are not incurred by foreign manufacturers who import finished goods to market in either Canada or the United States. This puts domestic industry at a competitive disadvantage in its own market.

The border is no longer a physical location for companies. The border has now been pushed back to the factory and into the supply chain with the request for data and paperwork from dozens of government agencies well before a shipment ever sees the physical border crossing. This data must be sent to and approved by each individual agency before shipments can cross. While this might make sense on a shipload of goods from Asia, considering 60 per cent of shipments across the Canada-US border are intra-company, it simply creates a needless pile of data for both companies and the government. This is the thickening of the border that is so often discussed, and there can be great economic and security benefits for doing it smarter and more efficiently.

The meeting with Commissioner Bersin allowed CME and its members to continue to push for its three point plan to simplify border processing that has been supported by industry in both Canada and the US, including


1) Harmonize and expand trusted trader programs, including the elimination of transactional reporting for qualified companies;  

2) Implement harmonized government-wide single-window reporting; and,
   
3) Reduce barriers to the movement of business personnel.
    For the CME’s full recommendations to governments for the Beyond the Border Working Group, go to here.

    Courier Low Value Shipment Program – New Eligibility Requirements

    (CBSA)

    This communiqué provides further details regarding the Courier Low Value Shipment (LVS) Program’s additional eligibility requirements.

    The following provides clarification of the Canada Border Services Agency (CBSA)’s 2nd additional eligibility requirement to provide CBSA access to a proprietary system:

    2) Participation in the Courier LVS Program will be restricted to companies that will allow the CBSA the use of their proprietary systems for report / release functions and risk assessment capabilities.

    The CBSA has mandated a requirement for a proprietary system in order to ensure that companies possess a sound electronic architecture capable of supporting the report and release functions of the Courier LVS Program, including risk assessment and targeting capabilities.  This requirement is based on the international standards of the World Customs Organization (WCO) and the World Trade Organization (WTO). 

    Under this requirement, a proprietary system must have a high degree of control over the expedited shipments through the use of internal security, logistics, and tracking technology.  The use of a third party system does not constitute a control based on internal security, logistics and tracking technology. 

    Any questions regarding system requirements, and/or to obtain answers/clarification regarding system requirements, and/or to determine if a functionality within a company’s present system (e.g. link/communication between the pre-configured dedicated electronic workstation located at the CBSA office(s) and the company’s secure and protected targeting server) must be forwarded in a clear and precise format in writing to the Courier LVS Program.

    When considering steps and monetary expenditures to meet the eligibility requirements of Partners In Protection (PIP) membership and having a proprietary system, it is important to note that continued participation in the Program will still be dependent on a participant being able to meet the 3rd additional eligibility requirement, i.e. the company will be required, in future, to transmit its pre-arrival cargo data to the CBSA as it does today for high value shipments.

    Current participants planning to remain in the Courier LVS Program are required to provide a preliminary written self-assessment of their company’s status in regards to the Program’s current and additional requirements by November 1, 2011.  It must contain clear and precise information on how they meet, or will meet, all of the eligibility requirements of the Program: the bonded carrier regulatory requirement, and the three additional eligibility requirements.  Interested stakeholders affected by the Program’s moratorium will also be given until this date to provide a preliminary written self-assessment of their company’s status in regards to the Program’s current and additional requirements. 

    The written self-assessment for continued participation in the Courier LVS Program should be directed by e-mail by November 1st 2011, to Wendy Guard, Manager, Postal and Courier LVS Programs at wendy.guard@cbsa-asfc.gc.ca or Vincent Millar, Senior Program Advisor, Courier LVS Program at vincent.millar@cbsa-asfc.gc.ca.

    Furthermore, all companies will have until December 30, 2011, to formally provide the CBSA with a decision regarding a withdrawal from the Program or commitment to proceed with the next steps to formally meet the Program requirements.

    It should be noted that another communiqué outlining an exception to the new additional requirement for companies involved in casual Mail-Order/Direct Marketing goods will be released separately.

    The CBSA will continue to work with all impacted stakeholders as they transition to implementing the Program’s new requirements.

    Questions, comments or concerns regarding these proposed changes, should be directed by email to Wendy Guard, Manager, Postal and Courier LVS Programs at wendy.guard@cbsa-asfc.gc.ca or Vincent Millar, Senior Program Advisor, Courier LVS Program at vincent.millar@cbsa-asfc.gc.ca.

    Importation of Casual Mail-Order/Direct Marketing Goods: Courier Low Value Shipment Program

    (CBSA)

    Changes Affecting Participants Involved in the Importation of Casual Mail-Order/Direct Marketing Goods

    The Courier Low Value Shipment (LVS) Program is undergoing significant changes to ensure that its process continues to provide an expedited service within a secure environment and operates within the Canada Border Services Agency (CBSA) mandate by providing a proper balance between facilitation and security.

    Following the announcement of new Program requirements, concerns have been expressed by external clients that are involved in a large and very specific import environment within the current Courier LVS Program, i.e. importation of casual Mail-Order/Direct Marketing goods. 

    An in-depth review of these external clients’ concerns was performed to determine their validity and the risks/benefits of finding a solution within or outside of the Courier LVS Program to deal with this special import environment.   

    Based on its findings, the CBSA has determined that a solution to this matter within the Courier LVS Program was beneficial and necessary.  This solution will lessen the impact of the additional eligibility requirements on this specific import environment; it will allow an exception to one criteria for this specific low risk import environment for casual goods, while ensuring the CBSA retains the objective of a secure process with an improved targeting capacity.

    Participants involved in the casual Mail-Order/Direct Marketing import environment will be required to meet the current and additional eligibility requirements of the Courier LVS Program; however, the proprietary system that they will utilize will not be required to include an internal tracking capacity as long as the third party carrier transporting the goods to Canada is a Partners In Protection (PIP) approved carrier/courier. 

    The Courier LVS Program casual Mail-Order/Direct Marketing exception will have the following parameters:

    • The participant will only import casual Mail-Order/Direct Marketing goods from known and recognized casual Mail-Order/Direct Marketing retailers. The participant will be required to provide a listing of the casual Mail-Order/Direct Marketing retailers to the CBSA;

    • The casual Mail-Order/Direct Marketing goods cannot include any other government department (OGD) prohibited, regulated or controlled items; the participant will be required to provide a listing/catalogue of the casual Mail-Order/Direct Marketing goods to the CBSA;

    • The casual Mail-Order/Direct Marketing retailers must be located only in the United States.

    Participants must meet the bonded carrier regulatory requirement of the Program and the three additional eligibility requirements that were announced with the above exception for the proprietary system.  This solution recognizes the uniqueness and reality of the casual Mail-Order/Direct Marketing import environment between the United States and Canada.

    The CBSA will continue to provide guidance for impacted stakeholders and assist them as they transition towards implementing the new Program requirements.

    Questions, comments or concerns regarding this solution should be directed by email to Wendy Guard, Manager, Postal and Courier LVS Programs at wendy.guard@cbsa-asfc.gc.ca or Vincent Millar, Senior Program Advisor, Courier LVS Program at vincent.millar@cbsa-asfc.gc.ca.

    A preliminary written self-assessment of the company’s status in regards to the Program’s current and additional requirements should be directed by e-mail by November  1 2011, to Wendy Guard, Manager, Postal and Courier LVS Programs at wendy.guard@cbsa-asfc.gc.ca or Vincent Millar, Senior Program Advisor, Courier LVS Program atvincent.millar@cbsa-asfc.gc.ca.  It must contain clear and precise information on how the company meets or will meet all of the eligibility requirements of the Program as described above.

    Companies will have until December 30, 2011, to formally provide the CBSA with a decision regarding a withdrawal from the Program or a commitment to proceed with the next steps to formally meet the Program requirements.

    U.S. Border Czar Pitches ‘Thinner’ Border for Low-Risk Traffic

    (Steven Chase — Globe & Mail) 

    On the eve of a perimeter security deal between Ottawa and Washington, the top U.S. customs official is championing the idea of a “thinner” border for low-risk traffic as he seeks to reassure Canadians he understands what they want from the controversial agreement.

    Alan Bersin, the commissioner of U.S. Customs and Border Protection, says he wants to make it easier for legitimate travellers and cargo to enter the United States so both countries can focus on high-risk traffic instead.

    He said under the deal Canada and the U.S. would exchange information on risky travellers and cargo, but not on all traffic. “It’s not to willy-nilly share data that would violate notions of privacy and civil liberties … but to share alerts and alarms that are being raised,” he said.

    The U.S. border czar was in Ottawa on Monday as the clock ticks down on an announcement of the “action plan” for the Canada-U.S. perimeter deal to ease trade and travel between the two countries after a decade of thickening security measures. Read more here.

    Glimmer of Hope at Peace Bridge

    (Buffalo News)

    Deal on shared border could finally allow improvements to the plaza

    Maybe it really is true that good things come to those who wait.

    In Buffalo, we’ve been waiting and waiting and waiting for something to happen with the Peace Bridge. Work has been stalled because the bridge might have killed birds and fish, because the larger Customs plaza required would have caused too much disruption in Buffalo, because there was no way to accomplish shared border management, because it is easier to do nothing than it is to do something.

    But, now, a key stumbling block may be about to vanish and, with it, yet another. The result could be to clear the way for construction of a new plaza and, dare we think it, eventual construction of a new bridge. Right here in Buffalo.

    The development is a pending agreement—all but done, to hear Sen. Charles E. Schumer, D-N. Y., tellit— to implement a modified form of shared border management on the Canadian side of the Peace Bridge. Under the plan, truck traffic would be inspected in Fort Erie, Ont., before crossing the bridge to Buffalo. Only about 10 percent of the trucks would require inspection on this side of the border, meaning that a much smaller plaza than previously envisioned could be built. Read more here.

    Canada Needs to Develop a China Strategy

    (iPolitics – Robert Wright)

    It is time for the Government of Canada to lead a national discussion on the future of Canada-China relations.

    The Chinese economy is the second largest in the world and, even in this period of global economic instability, is projected by the IMF to grow between 9 and 10% in 2011. Most economists predict that the Chinese GDP will surpass that of the U.S. sometime over the next 10 to 20 years. Chinese foreign investment is increasing around the world as China establishes long-term commercial partnerships that will drive growth for years to come.

    Over the last ten years our approach to China has been driven more by issue management than by a clear vision of where we want to go. Our Team Canada trips to China attracted attention at the time but were focused on signing commercial contracts and, for the most part, were not adequately followed up by government or business. Since that time our relations have been focused almost entirely on efforts to manage bilateral irritants. Given the improvements in bilateral relations over the last three years and the welcome resolution of at least a few of these irritants, the timing is right to put in place a more coherent national strategy that will provide direction to the relationship for the next ten years. Read more here.

    October 16, 2011

    Ohio Needs This Bridge Too

    (Roy B. Norton - Consul General of Canada)

    Michigan lawmakers have many reasons to support an agreement with Canada that would build a new bridge across the Detroit River. None is more compelling than the economic advantages this project will bring to their state.

    But this is an Ohio issue too — which presumably is why the state Senate unanimously passed a resolution last year endorsing the New International Trade Crossing.

    Canada is the leading trade partner of the United States and Ohio. More than 300,000 Ohio jobs depend on trade with Canada — almost 20,000 of these in Lucas, Wood, and Hancock counties.

    Exports from Ohio to Canada increased last year by more than 20 percent over 2009. As it has for many years, Ohio continues to enjoy a significant trade surplus with Canada. Modern border infrastructure linking the Midwest to Canada is essential to moving existing and future trade.

    The New International Trade Crossing — a six-lane, state-of-the-art bridge between Detroit and Windsor, Ontario — and other infrastructure enhancements will strengthen Toledo’s efforts to become a transportation and logistics gateway. That’s why the Toledo Metropolitan Area Council of Governments strongly supports the project. Read more here.

    Moroun Should Stop Meddling in a New Canada-U.S. Crossing

    (Globe & Mail Editors)

    The busiest crossing between Canada and the United States is in private hands. That’s worked well enough for decades, but the owner is now getting in the way of a much-needed expansion of capacity at the border. He should end his campaign of obstruction and alarmism.[...]

    Mr. Moroun, his monopoly at risk, is opposed. He alternately suggests that a new crossing isn’t needed, or that he would oblige by building a new bridge beside his existing bridge – a move that would mean more money coming his way but, in the absence of new approach roads or a customs plaza, create further congestion in downtown Windsor.

    Either way, he stands in the way. He has run inaccurate ads on both sides of the border (including during Ontario’s provincial election campaign), claiming that the bridge will cost Michigan taxpayers hundreds of millions of dollars. 

    Read the complete editorial here.