WT/TPR/M/314/Add.1
20 August 2015
(15-6801)
Page: 1/20
Trade Policy Review Body
15 and 17 June 2015
Original: English/anglais/inglés
ANSWERS TO QUESTIONS FROM THE GOVERNMENT OF CHINA
Report by the Secretariat – (WT/TPR/S/314)
1 ECONOMIC ENVIRONMENT
1.1 Real Sector and structural reform
Page 16, paragraph 1.8
[China Question 1]: The report states that "With respect to the goal of investing in infrastructure
and transportation, the EAP 2014 committed".
Please introduce the major sources of funding for infrastructure and transportation investment in
Canada in recent years, especially of the usage of PPP and other financing forms in relevant
sectors.
Canada's Response: Provinces, territories and municipalities own over 95 percent of core public
infrastructure in Canada.
Sources of funding
Funding for infrastructure investments has generally been sourced from government contributions
– from the federal, provincial and municipal governments – through general tax revenues, with no
dedicated taxes for infrastructure investments. User charges have also been utilized in the case of
assets like public transit projects, international crossings, and water/wastewater facilities. More
recently, user charges have been levied on a few highways and domestic bridges. Levels of cost
recovery vary by asset class. For example, no municipal transit system in Canada fully recovers
operating costs from fares let alone any share of capital costs.
While the vast majority of core public infrastructure is owned by provinces, territories and
municipalities, the federal government provides financial contributions to infrastructure projects
given the importance of modern and efficient public infrastructure for the country's economic
prosperity, long-term economic growth and quality of life.
Since 2006, the Government of Canada has made a significant commitment towards provincial,
territorial and municipal public infrastructure:

$33 billion through the 2007 Building Canada Plan, the first long-term, stable and
predictable federal plan to provide funding to provinces, territories and municipalities to
support their respective public infrastructure priorities.

Its successor, the 10 year, over $53 billion New Building Canada Plan launched in 2014
(which includes $6 billion in funding from the 2007 Building Canada Plan), which
includes:
o
over $32 billion over 10 years in dedicated funding for municipal infrastructure,
including $21.8 billion under the Gas Tax Fund, and $10.4 billion through the
Incremental GST Rebate for Municipalities;
o
$14 billion over 10 years through the New Building Canada Fund, which includes
a $4 billion National Infrastructure Component (supporting investments in
projects of national significance) and a $10 billion Provincial-Territorial
WT/TPR/M/314/Add.1
-2Infrastructure Component (supporting projects of national, regional and local
significance in communities across the country); and
o

the $1.25 billion P3 Canada Fund, managed by PPP Canada Inc., which provides
support for innovation infrastructure projects delivered through the publicprivate partnership (P3) approach.
Infrastructure stimulus measures, which have supported 30,000 projects across the
country, as part of Economic Action Plan 2009.
The Government of Canada has increased its annual support for provincial, territorial and
municipal infrastructure from $571 million in 2003–04 to an estimated $5 billion in 2015–16. The
most recent federal budget announced a new and innovative Public Transit Fund, the
Government's largest targeted infrastructure program, to promote public transit infrastructure
investment in a manner that is affordable for taxpayers and efficient for commuters. The Fund will
provide $750 million over two years, starting in 2017–18, and $1 billion annually ongoing
thereafter.
Under the New Building Canada Fund, the maximum Government of Canada contribution is capped
at up to one third of eligible project costs (generally capital costs related to construction).
However, in the case of provincial highways, major provincial roads, and public transit, the
maximum Government of Canada contribution is capped at up to 50 percent of eligible costs. In
the case of projects located in the territories, the maximum Government of Canada contribution is
capped at 75 percent of eligible costs. A key exception is in the case of projects that are procured
through a public-private partnership or owned by private for-profit organizations, in such cases,
the maximum Government of Canada contribution is capped at 25 percent of eligible costs.
The Government of Canada is also the custodian of a broad range of infrastructure assets that play
a critical role in delivering core services to Canadians, improving the safety and security of
borders, enabling the safe and efficient movement of people and goods, supporting science and
innovation, and providing access to national parks. Federal spending on these assets is largely paid
through general tax revenues, with some user charges, notably for international bridges, entrance
to parks, etc.
Financing
With respect to the financing of infrastructure projects, governments typically finance the
associated costs through a combination of general tax revenues, borrowings and contributions
from more senior levels of government (e.g. provincial and/or federal funding). Under a traditional
procurement approach, costs are paid as they are incurred in the construction of the asset. Under
a public-private partnership (PPP) procurement approach, the construction costs are typically
financed by the private partner through short-term borrowings. Under PPP models where the
private sector is responsible for the maintenance and/or operations of the asset over a long-term
period, a portion (between 75 percent to 85 percent) of the construction costs and associated
short-term financing costs is repaid by the public sector through the construction period (namely
at key milestones) and at substantial completion. The remaining capital costs are financed by the
private sector through long-term borrowings, and repaid through performance-based availability
payments through the contract period. Having this private sector capital at risk brings discipline
and reduce maintenance and operations risks for the procuring government.
1.2 Fiscal Policy
Page 18, paragraph 1.19
[China Question 2]: The report states that "The Government seems intent on delivering a balanced
budget, even with the recent decline in crude oil prices."
How does Canada evaluate the impacts of the recent decline in oil prices on Canada's fiscal
revenue? Will it affect the goal of Canada to deliver a balanced budget in 2015-16?
Canada's Response: With respect to the fiscal impacts of lower oil prices, it is important to note
that the federal government does not collect royalties from natural resource firms. That revenue
WT/TPR/M/314/Add.1
-3source is only collected by Canada's sub-national, provincial governments. As a result, the fiscal
situation of the federal government is primarily affected by lower corporate profits among natural
resource firms, which will result in lower corporate income taxes. Other revenue streams, such as
personal income taxes and the Value Added Tax (GST) are also affected, but to a significantly
lesser extent.
Federal corporate income tax receipts are expected to decline by 2.9% in 2015-16, primarily
reflecting the impact of lower oil prices. However, ongoing gains in economic activity and related
tax receipts in the non-energy sectors of the economy mean that the Government will still balance
the budget this year – and indeed expects to post a surplus of $1.4 billion – after taking into
account the 1.0 billion set aside for contingencies.
Of note, the Government's projections for nominal GDP, the broadest measure of the tax base and
the basis for the Government's fiscal planning assumptions, are based on the average of private
sector forecasts.
1.5.2 Trade in services
Page 28, paragraph 1.35
[China Question 3]: The report states that "These include the launch of an international education
strategy to attract international students to Canada and the development of an extractive sector
strategy."
Please illustrate in detail the specific measures taken by Canada to attract international students.
Canada's Response: Canada's International Education Strategy was launched by the Minister of
International Trade in January 2014, building on the Edu-Canada pilot which had been in place
since 2007. Trade Commissioners in over 100 Canadian missions (embassies, consulates, high
commissions, trade offices) around the world and across Canada provide core services to Canada's
education sector clients and stakeholders to enhance their international business development
initiatives and to coordinate Canada's participation in hundreds of education fairs and events
where strong connections are made with international students, researchers, and institutions.
Canadian national education associations are also eligible for the Department of Foreign Affairs,
Trade and Development's (DFATD) Global Opportunities for Associations (GOA) program which
provides cost-shared funding to support new international business development initiatives. As
well, DFATD provides scholarships annually to Canadian and international students for
study/research in Canada and abroad under its International Scholarships Program and
coordinates the promotion of other federally-funded international scholarship and fellowship
programs. DFATD's International Education Division also provides information digitally for
international students considering studying in Canada on its Education au/in Canada web site and
Flickr gallery.
[China Question 4]: How does Canada evaluate the effect of the above-mentioned measures?
Canada's Response: Canada: tracks the number of international students coming to Canada
based on their country of origin; monitors the use of funding by missions abroad for international
education initiatives; measures actual results of funding awarded to national education
associations under GOA in comparison with anticipated results; tracks the number of scholarships
awarded under the International Scholarships Program; liaises with other federal departments and
agencies to track their international awards; and measures visitors, views, and other online
metrics to its digital assets (e.g., Web sites and Flickr).
2 TRADE AND INVESTMENT REGIME
2.1 General Framework
Page 32, paragraph 2.4
[China Question 5]: The report states that "The Small and Medium-sized Enterprises Advisory
Board (SMEAB) is comprised of 18 private sector leaders from small and medium-sized
enterprises; it meets biannually."
WT/TPR/M/314/Add.1
-4Please explain how the private sector leaders of the consultative bodies are selected and what
their main functions are. Can senior managers of foreign-invested enterprises become private
sector leaders?
Canada's Response: The 18 members of the Small and Medium-sized Enterprises Advisory Board
are selected and appointed by the Minister of International Trade. Members are selected based on
their overall expertise and sound understanding of international commerce, the Canadian
economy, the business environment, innovation and competitiveness. Members participate as
individuals and not as representatives of specific organizations.
The members provide the Minister of International Trade with advice and recommendations on the
commerce-related priorities, policies, programs and services of the Department for Foreign Affairs,
Trade and Development (DFATD) in support of small and medium-sized enterprises. There is no
stipulation that the members must work in or own a Canadian-owned enterprise, but relatively few
foreign-invested enterprises fall into the category of small or medium-sized enterprises.
Page 33, paragraph 2.5
[China Question 6]: The report states that "As of January 2015, the Advisory Council was in the
process of being established."
Please introduce the latest progress of the establishment of the Global Markets Action Plan
Advisory Council by Canada.
Canada's Response: The inaugural meeting of the Global Markets Action Plan Advisory Council
was held on March 27, 2015, and provided the Minister of International Trade with strategic insight
and real-world perspectives to ensure that GMAP continues to reflect the priorities, needs and
interests of Canadian businesses. More information can be found at
http://www.international.gc.ca/media/comm/news-communiques/2015/03/27a.aspx?lang=eng.
Page 33, paragraph 2.6
[China Question 7]: The report states that "In the context of Canada's FTA negotiations, the
Government of Canada is committed to engaging in broad-based consultations with the private
sector, civil society groups, and individual Canadians to help inform Canada's negotiating
objectives and priorities. Among the consultation mechanisms used to afford Canadians the
opportunity to shape the trade agenda, the Government of Canada publishes a notice in the
Canada Gazette soliciting comments from Canadians prior to Canada's participation in
negotiations."
Please illustrate the specific ways in which Canada solicits public comments in the process of its
FTA negotiations. Will Canada publish the details of the relevant in-person meetings, conference
calls and stakeholder events after such events?
Canada's Response: The Government of Canada is committed to encouraging the participation of
all Canadians in the development of its policies and negotiating positions related to international
trade. With regard to potential or actual negotiations, the Government of Canada also engages in
broad-based consultations with the private sector, civil society groups, provinces and territories,
and individual Canadians to help inform Canada's specific negotiating objectives and priorities.
Prior to formally launching bilateral or regional FTA negotiations, the Government of Canada
typically publishes a notice in the Canada Gazette soliciting comments from Canadians.
Consultations continue throughout the negotiating process. Working with all levels of government,
Canada continues its broad-based consultation approach to elicit the views of business and
industry, the academic research community, and interested citizen-based organizations and public
interest groups, through both formal and informal mechanisms. Moreover, subject specific lead
negotiators may conduct separate consultation and outreach activities to inform Canadian
negotiating positions.
The Government of Canada does not as a matter of standard practice publish the details of the
relevant in-person meetings, conference calls and stakeholder events after such events take place.
WT/TPR/M/314/Add.1
-5The Government of Canada is mindful of maintaining the confidentiality of the participants and the
nature of the information provided by those participants.
[China Question 8]: The report states that "In the context of Canada's FTA negotiations, the
Government of Canada is committed to engaging in broad-based consultations with the private
sector, civil society groups, and individual Canadians to help inform Canada's negotiating
objectives and priorities. Among the consultation mechanisms used to afford Canadians the
opportunity to shape the trade agenda, the Government of Canada publishes a notice in the
Canada Gazette soliciting comments from Canadians prior to Canada's participation in
negotiations."
As Canada is actively participating in the TPP negotiations, please introduce the opinions and
attitudes of major industrial sectors and interested parties towards the negotiations in Canada.
Canada's Response: Prior to Canada's joining the TPP, broad public consultations were
undertaken. In December 2011, Canada launched a Canada Gazette process seeking feedback
from the public on Canada's participation in the TPP – which is standard for any trade negotiation
in which Canada engages. The Government of Canada received 79 submissions from companies,
associations and provinces, each representing a broad spectrum of Canadians.
Overall there has been strong and broad support for Canada's participation in the TPP. Generally,
the views expressed related to ensuring an ambitious outcome in market access and easing the
process of doing business across borders (regulatory coherence, transparency of rules/costs,
customs facilitation, digital economy, etc.). Issues such as intellectual property and investment
protections were also frequently cited, among others.
Since joining the TPP, negotiators have held a large number of stakeholder meetings, and have
heard from hundreds of industry and non-industry representatives. Key issues raised by major
industrial sectors and interested parties remain focussed on areas of market access (goods,
services, financial services, government procurement, temporary entry, and investment), as well
as issues pertaining to intellectual property. The primary interest expressed by national
associations and individual companies has remained ambitious tariff outcomes across all sectors.
2.1.1 New Developments
Page 33, paragraph 2.7
[China Question 9]: The report states that "In 2011, the United States and Canada jointly
launched the Beyond the Border Action Plan to improve and speed up legitimate trade and travel
between the two countries. The Plan is being implemented in phases and includes improvements
to infrastructure at the border, implementing the single window, enhancing benefits of the trusted
trade and traveller programmes, improving cargo security, sharing immigration information, and
supporting cross-border law enforcement activities. "
Regarding the actions taken by Canada to facilitate trade, is Canada planning to further expand
their application and conduct similar cooperation with other members?
Canada's Response: Beyond the Border is a bilateral Canada-U.S. initiative to further strengthen
what is already the strongest trading relationship in the world. As such, the vast majority of Action
Plan items within the Beyond the Border framework relate almost exclusively to facilitating the
cross-border flow of legitimate travelers and goods between Canada and the U.S. These include
negotiating a new comprehensive preclearance agreement, implementation of the Integrated
Cargo Security Strategy, strengthening cross-border law enforcement efforts, border infrastructure
improvement, establishment of the 'Single Window' approach and expansion of the NEXUS trusted
traveler program.
Canada's participation in initiatives such as Beyond the Border, as well as in other ongoing
bilateral, regional, and multilateral trade negotiations shows Canada's commitment to economic
growth through the negotiation of agreements that expand and facilitate trade.
2.3.2.1 Reciprocal trade agreements
Page 28, paragraph 2.25
WT/TPR/M/314/Add.1
-6-
[China Question 10]: The report states that "In order to improve its market access opportunities,
Canada has pursued bilateral and regional Free Trade Agreements (FTAs) as an important part of
its trade policy and has gradually increased the number of FTAs in recent years."
What major factors
FTA negotiations?
will
Canada
take
into
consideration
when
prioritizing
partners
of
Canada's Response: In 2013, the Government of Canada released the Global Markets Action
Plan. Under the Global Markets Action Plan, the Government of Canada is concentrating on the
markets that hold the greatest promise for Canadian business through vigorous trade promotion
and ambitious trade policy.
The Global Markets Action Plan is publicly available http://www.international.gc.ca/global-marketsmarches-mondiaux/index.aspx?lang=eng.
The Government of Canada takes into account a number of considerations when taking a decision
regarding whether to launch FTA negotiations with a potential partner. These include: the potential
to generate significant economic and commercial benefits for Canada; the level of Canadian
business interest and domestic support; the willingness and capacity of prospective partners to
negotiate with Canada, including as determined through detailed, pre-negotiation exploratory
talks.
2.4.2 Investment Canada Act
Page, 41, paragraph 2.37
[China Question 11]: The report states that "Canada's 1985 Investment Canada Act (ICA) provides
the main legal framework for reviewing foreign investment in Canada. The review of foreign
investment has two main purposes: to assess if they are likely to benefit Canada and to see if they
are likely to injure national security. All foreign investment to establish a new Canadian business
and to acquire control of a Canadian business, must be notified unless the investment is
reviewable (see below), in accordance with the ICA (Art. 11)."
What major factors will Canada take into consideration when assessing if a certain investment
program is "likely to benefit Canada" or "likely to injure national security"?
Canada's Response: Net Benefit Review

To approve an application under net benefit review, the Minister of Industry must be
satisfied that the proposed investment is likely to be of net benefit to Canada.

In making his decision, the Minister carefully considers the plans, undertakings and other
information submitted by the investor in light of the six net benefit factors listed in section
20 of the Act. Undertakings are legally binding commitments.

The six factors listed in section 20 of the Act are:
o
The effect of the investment on the level and nature of economic activity in Canada,
including, without limiting the generality of the foregoing, the effect on employment,
on resource processing, on the utilization of parts, components and services produced
in Canada and on exports from Canada;
o
The degree and significance of participation by Canadians in the Canadian business or
new Canadian business and in any industry or industries in Canada of which the
Canadian business or new Canadian business forms or would form a part;
o
The effect of the investment on productivity, industrial efficiency, technological
development, product innovation and product variety in Canada;
o
The effect of the investment on competition within any industry or industries in
Canada;
WT/TPR/M/314/Add.1
-7o
The compatibility of the investment with national industrial, economic and cultural
policies, taking into consideration industrial, economic and cultural policy objectives
enunciated by the government or legislature of any province likely to be significantly
affected by the investment; and,
o
The contribution of the investment to Canada's ability to compete in world markets.
National Security Review

Under the Investment Canada Act, foreign investment, regardless of its dollar value, may be
subject to a national security review if a potential security threat is identified.

An investment is subject to review under the national security provisions if the Minister of
Industry, after consultation with the Minister of Public Safety, considers that the investment
could be injurious to national security.

The Governor in Council (GIC, or Cabinet) can order a review, on the recommendation of the
Minister of Industry.

The Minister of Industry will then conduct the review, in consultation with the Minister of Public
Safety. If further steps are required, the Minister submits a report to the GIC with
recommendations.

The GIC has the authority to take any measures it considers necessary to protect national
security in relation to the investment.
[China Question 12]: Please provide the number of foreign investment programs that are rejected
because of failure to pass the above-mentioned review in recent years.
Canada's Response: Since the Act was introduced in 1985, only one transaction has been
formally disallowed under the net benefit review process: MacDonald, Dettwiler and Associates
(MDA) proposed sale of its space division to the U.S. Company Alliant Techsystems (ATK) in 2008.
For confidentiality reasons, the Government of Canada does not identify the number of national
security reviews undertaken.
[China Question 13]: Related reviews and re-examinations may impose unnecessary burdens on
foreign enterprises, especially SMEs. Does Canada have any plan to reduce review requirements,
in particular, for SMEs and small amount investment programs?
Canada's Response: The net benefit review focuses on major acquisitions of control. Direct
acquisition of control in the non-cultural sector by private-sector, WTO member investors are
subject to net benefit review only if the enterprise value of the Canadian business meets or
exceeds the established threshold. Currently, this threshold is $600 million in enterprise value of
the Canadian businesses acquired. The threshold will increase to $800 million in enterprise value
on April 24, 2017 and to $1 billion in enterprise value in April 24, 2019. Beginning in
January 2021, the threshold will be indexed to reflect the change in nominal gross domestic
product in the previous year. For foreign investors that are state-owned enterprises, the threshold
is $369 million and based on the book value of the assets of the Canadian business (adjusted
annually for changes in Canada's economic growth). Foreign investors making investments in
Canada that fall below the established thresholds are required to notify the Government of their
investment, and are not subject to net benefit review under the Act.
Page 42, paragraph 2.38
[China Question 14]: The report states that "New provisions in the ICA were introduced in 2009,
through amendment, to provide for the review of investments on national security grounds.
Accompanying regulations, known as the National Security Review of Investments Regulations,
prescribe periods of time and investigative bodies for the reviews. The Governor in Council (GIC)
can order a national security review of new businesses, investments below the net benefit
threshold, and minority investments. "
WT/TPR/M/314/Add.1
-8What major factors will GIC take into consideration when determining whether to initiate a national
security review?
Canada's Response: There are no national security review criteria enumerated in the Investment
Canada Act or the National Security Review of Investment Regulations.
[China Question 15]: What ways of complaint or appeal are available when a foreign investment
program is determined "being likely to injure national security" and rejected? Can remedies be
obtained if legitimate interests of the relevant foreign investors are injured?
Canada's Response: Under the national security provisions of the Investment Canada Act,
decisions and orders of the Governor in Council, and decisions of the Minister are final and binding
and, except for judicial review under the Federal Courts Act, are not subject to appeal or to review
by any court.
3 TRADE POLICIES AND PRACTICES BY MEASURE
3.1.1 Customs procedures and requirements
Page 46, paragraph 3.6
[China Question 16]: The report states that "In addition to the RPP, CBSA is running a number of
programmes aiming at facilitating trade and enhancing border security (Table 3.2). Through its
Trusted Traders Strategy, qualified companies can benefit from streamlined and more efficient
border processes. The Strategy includes the Partners in Protection (PIP), the Customs
Self-Assessment (CSA), and the Free and Secure Trade (FAST) programmes. "
Can foreign exporters or manufacturers with good business records and reputations participate in
some of the above-mentioned programmes?
Canada's Response: Partners in Protection (PIP) program
To be eligible for membership in the PIP program, an applicant must own or operate facilities
based in Canada or the United States (U.S.) that are involved in the cross-border movement of
commercial goods. For businesses based in the U.S., membership in the PIP program is available
to importers that conduct business in Canada (i.e., hold a valid Canadian business number and file
Canadian customs declarations) and to carriers in all modes of transport, provided that they hold a
valid Canadian carrier code.
Customs Self-Assessment (CSA) program
CSA authorizations are available to Canadian and U.S.-based importers and carriers.
CSA authorizations are governed by the Accounting for Imported Goods and Payment of Duties
Regulations (AIGPDR). Subsection 10.5(2) of the AIGPDR outlines the requirements for the
issuance of a CSA authorization to importers and paragraph 10.5(3) outlines the requirements for
carriers. Pursuant to paragraphs 10.5(2)(a) and (b), participation in the CSA program is available
to importers;
"(a) if the importer is an individual, the importer ordinarily resides in Canada or the United
States or, if the importer is a partnership, the importer has at least one partner who is an
individual who ordinarily resides in Canada or the United States;
(b) if the importer is a corporation, the importer has its head office in Canada or the
United States or operates a branch office in Canada or the United States."
N.B.
It should be noted that Table 3.2 of the report incorrectly states that eligibility for CSA is available
to CDRP registered drivers only. In fact, use of release prior to accounting (or a CSA clearance) is
outlined under section 10.2 of the AIGPDR and states;
Eligible goods may be released under paragraph 32(2)(b) of the Act prior to the accounting
required under paragraph 32(1)(a) of the Act and may be released under subsection 33(1) of the
Act prior to the payment of the duties required under paragraph 32(1)(b) of the Act on condition
that
WT/TPR/M/314/Add.1
-9-
(a) the importer of those goods is a CSA importer;
(b) the carrier that transports those goods is a CSA carrier;
(c) when reporting the goods, the operator of the conveyance provides in
bar-coded format the CSA carrier's carrier code as assigned by the Agency and the
CSA importer's business number; and
(d) in the case of eligible goods transported into Canada by a commercial highway
conveyance as defined in section 1 of the Presentation of Persons (2003)
Regulations, the driver of the conveyance holds an authorization under those
Regulations.
The Presentation of Persons (2003) Regulations authorizations includes registered drivers under
CDRP as well as FAST. There are no requirements for CDRP or FAST registration in the other
modes (rail, marine and air).
Free and Secure Trade (FAST) benefit
Membership in both the PIP and CSA programs is required to use the FAST lanes.
For clarity, the use of the FAST dedicated lanes is permitted if the following conditions are met:




The importer is PIP and CSA approved;
The carrier is PIP and CSA approved;
All goods on-board are CSA-eligible goods; and,
The driver is a registered commercial driver under FAST or is Commercial Driver
Registration Program (CDRP) approved.
Page 48, paragraph 3.7
[China Question 17]: The report states that "The CBSA is also running a number of bilateral
programmes with Canada's key trading partners, mainly the United States."
Besides the USA, with which members does [Canada] have bilateral cooperating programmes in
trade facilitation? Is Canada planning to extend such cooperation with developing members?
Canada's Response: Canada has cooperation programmes with several countries. For example,
in March of 2013, Canada signed a Customs Cooperation Agreement with the European Union to
support safe and secure trade. Canada also engages in cooperation with developing members. In
August 2014, the Canada Border Services Agency (CBSA) and Mexico's Tax Administration Service
(SAT) signed a Memorandum of Cooperation (MOC), demonstrating a joint commitment to
ensuring the efficient and secure movement of goods between Canada and Mexico. This led to the
development of a country-specific cooperation agenda focused on harmonizing customs data
requirements, facilitating multimodal trade, and increasing collaboration on risk management and
enforcement.
Canada is committed to cooperating with international partners, including developing members at
the WTO. For example, Canada is committed to sharing information with its domestic and
international partners for security and trade facilitation. We remain committed to safeguarding
information in our care. We share information upon request with partners through appropriate
information sharing vehicles. For example, in November 2014, Canada signed a Customs Mutual
Assistance Agreement (CMAA) with China to share information proactively or in response to
threats.
The CBSA also enters into Mutual Recognition Arrangements (MRA) between customs
administrations signifying that both apply similar security standards and site validation practices
when approving companies for membership in their respective Authorized Economic Operator
(AEO) programs. It also allows both countries to recognize each other's members as trusted
traders and grant them similar benefits. MRAs expand the international trade network of
accredited low-risk companies. MRAs allow customs administrations to work together to improve
their capability to target high risk shipments while expediting legitimate cargo.
WT/TPR/M/314/Add.1
- 10 The CBSA has signed four MRAs. In June 2008, the CBSA signed an MRA with the United States
(US) Customs-Trade Partnership Against Terrorism program, and additional MRAs were signed in
June 2010 with the Japan AEO program, Korea AEO program, and Singapore Secure Trade
Partnership program.
The CBSA considers several factors before engaging with another Customs Administration toward
the goal of reaching mutual recognition, including, but not limited to, the risk associated with the
supply chains originating within the respective countries, import/export volumes, the maturity of
the respective AEO program and the Government of Canada priorities.
3.1.7.1 Anti-dumping and countervailing measures
Page 63, paragraph 3.46
[China Question 18]: The report states that "Although the CBSA can self-initiate anti-dumping and
countervailing investigations, it generally initiates those following complaints from the domestic
industry."
In recent years, how many anti-dumping and countervailing investigations were self-initiated by
the CBSA, and how many were initiated upon complaints by the domestic industry?
Canada's Response: During the period of review from 2011 to 2014, all anti-dumping and
countervailing investigations reported were initiated upon complaints by the domestic industry.
The Canada Border Services Agency (CBSA) did not self-initiate any anti-dumping or
countervailing investigation.
Page 64, paragraph 3.48
[China Question 19]: The report states that "Between 2011 and 2014, the CBSA initiated 43
anti-dumping (AD) investigations, with a peak of 17 investigations in 2013 (Chart 3.4). In 2014,
13 new investigations were initiated. In general, there has been a steep increase in the number of
AD investigations in 2012-14, as compared with the previous three years."
Please explain the main reasons for the steep increase in the number of AD investigations during
this review period.
Canada's Response: Canada notes that the number of anti-dumping investigations in 2012-14
was not typical of Canada's general declining trend in the number of anti-dumping investigations.
For example, there were only 10 anti-dumping investigations initiated in the preceding three
years, from 2009 to 2011.
The increase in anti-dumping investigations in Canada in 2012-14 is limited to a narrow range of
products that may be affected by underlying issues of global concern (e.g. global steel production
overcapacity). Trade remedies investigations are legitimate tools to address situations where
unfair trading practices of foreign firms and governments are causing or threatening to cause
injury to domestic industry. Canada notes that its experience in anti-dumping investigations in
2012-14 is consistent with global trends over this time period.
3.1.8 Standards and other technical requirements
Page 69, paragraph 3.66
[China Question 20]: The report states that "Once a SDO makes the decision to develop a
standard, it establishes a technical committee that generally includes consumer representatives,
general interest group representatives, government officials and producers. The committee
typically reviews existing (international) standards first for possible adoption or adjustment."
How can foreign exporters and manufacturers, as interested parties, offer their opinions during the
standard developing process of a Standards Development Organizations (SDO)?
Canada's Response: There are several ways that stakeholders outside of Canada can offer their
opinions during the standards-development process of an SCC-accredited SDO. First, SDOs
accredited by SCC are required to have an open standards-development process and a balanced
WT/TPR/M/314/Add.1
- 11 matrix of committee members. Interested parties, including foreign exporters and manufacturers,
have several opportunities to comment on a draft standard: during the initial notification of work,
during the development of the standard, and when the standard is posted for public review. In
addition, qualified stakeholders from outside of Canada can also participate in the standardsdevelopment committee.
[China Question 21]: What's the proportion of international standards adopted in the current
technical standards of Canada?
Canada's Response: In fiscal year 2013-14, there were 116 National Standards of Canada
(NSCs) approved by SCC, 82 of which are national adoptions of international standards.
Page 69, paragraph 3.70
[China Question 22]: The report states that "The process of preparing technical regulations is
decentralized. Various federal and provincial authorities develop regulations, including technical
regulations."
Please introduce the respective functions of the federal and provincial authorities in formulating
technical regulations.
Canada's Response: Responsibilities are defined in Canada's Constitution which means that
some sectors are under provincial/territorial jurisdiction while with others fall under federal
authority. There are also matters that overlap jurisdiction but, usually, where federal regulations
exist, provincial/territorial regulations would be superseded by federal regulations.
[China Question 23]: What mechanism is adopted by the Federal Government of Canada to ensure
that the compliance of technical regulations formulated by the local authorities with the
TBT Agreement, SPS Agreement and other agreements of the WTO?
Canada's Response: Article 3 of the TBT Agreement requires that members take reasonable
measures to ensure compliance by local government bodies. To this end, Canada works closely
with sub-federal entities to inform them of their obligations, and also works with them to ensure
their compliance with trade commitments and in preparing notifications as required.
The federal government also has jurisdiction with regards to international and intra-provincial
trade for SPS issues. There are a variety of consultative mechanisms in place for representatives
of Federal/Provincial/Territorial governments to discuss the development and implementation of
policies and regulations. Where it is deemed that a federal SPS measure may have a significant
impact on trade, Canada notifies the measure in accordance with its transparency obligations
under the SPS Agreement. The Government of Canada is not aware of any SPS measures adopted
by sub-federal authorities that have a trade impact.
3.2.5 Export finance, insurance, guarantees
Page 77, paragraph 3.107
[China Question 24]: The report states that "Export Development Canada (EDC) is a Crown
corporation with the mandate to support and develop export trade and help businesses respond to
international business opportunities. It provides insurance products, financing and bonding
solutions to companies engaged in export-related activities, as well as to their foreign customers
(Table 3.13). EDC is financially self-sustained."
Is the major mandate of EDC, realizing the policy goal of "supporting and developing export trade"
or maintaining its own business and gain profit?
Canada's Response: The mandate of EDC is set forth in its enabling statute. It reads: "The
Corporation is established for the purposes of supporting and developing, directly or indirectly,
Canada's export trade and Canadian capacity to engage in that trade and to respond to
international business opportunities." As a Federal Crown corporation, EDC cannot carry on any
business or activity that is not consistent with its legislative mandate. As such, EDC does not
differentiate between a major mandate or a lesser mandate.
WT/TPR/M/314/Add.1
- 12 With respect to self-sustainability or profits, this concept does not derive from its mandate. EDC's
corporate plan provides that EDC is committed to remaining financially self-sustaining. EDC has a
strong focus on ensuring that it maintains sufficient financial capital to support the on-going
fulfillment of its mandate and responds to the evolving needs of Canadian exporters and investors,
and to be able to do so for many years to come.
[China Question 25]: How does EDC strike a balance between these two goals, especially when the
global financial crisis increases credit risks of export?
Canada's Response: EDC has a strong focus on ensuring that it maintains sufficient financial
capital to support the on-going fulfillment of its mandate and responds to the evolving needs of
Canadian exporters and investors, and to be able to do so for many years to come. EDC's
prudential risk management practices and policies have ensured that it can, and will, continue to
meet the needs of Canadian exporters.
Page 79, paragraph 3.109
[China Question 26]: The report states that "EDC may also fund non-export related transactions,
subject to ministerial approval. At the time of the financial crisis in 2009, the Export Development
Act was amended to include domestic financing, guarantee and insurance solutions in EDC's
mandate."
Please illustrate the fundamental principles of EDC in deciding to participate in domestic financing,
guarantee and insurance solutions.
Canada's Response: The decision to provide EDC domestic financing, guarantee and insurance
powers was made by the Government of Canada in order to add capacity to domestic credit and
insurance markets due to limited offerings from the private sector. This enabled EDC to provide
support for purely domestic transactions (financing, guarantees and insurance). In March 2014,
the temporary domestic mandate granted to EDC in the 2009 budget in response to the financial
crisis was removed, and new regulations came into force to define how EDC can deploy its export
mandate in support of transactions in Canada. The fundamental principle of EDC deciding to
participate in domestic financing, guarantee and insurance solutions is EDC's mandate, in
particular the mandate to support "Canadian capacity to engage in export trade."
[China Question 27]: Are the rates of EDC's relevant domestic services consistent with general
business conditions?
Canada's Response: EDC applies a consistent approach in the support of foreign transactions as
it does in the support of transactions in Canada.
3.3.2 Incentives and subsidies
Page 80, paragraph 3.115
[China Question 28]: The report states that "According to Canada Business Network, a
government information service for business, there are some 755 support programmes providing
assistance to businesses in the form of grants, loan guarantees, tax refunds and credits, and wage
subsidies. Many are at the provincial level and thus, restricted to recipients established in the
province. "
Please illustrate the major beneficiary sectors of the above-mentioned support programmes.
Canada's Response: The Canada Business Network is a collaborative arrangement between
federal and sub-federal government agencies to provide information to businesses. Details on
programs can be found in Canada's most recent subsidy notification (G/SCM/N/253/CAN).
[China Question 29]: How does Canada avoid excessive disturbance to market competition caused
by relevant support programmes?
Canada's Response: Canada, like many countries, maintains certain programs that support
businesses in their efforts to expand and grow. Canada takes great effort to ensure that these
WT/TPR/M/314/Add.1
- 13 programs are designed and implemented in accordance with the provisions of the Agreement on
Subsidies and Countervailing Measures (ASCM).
[China Question 30]: Has Canada appointed a specific institution to publish various federal and
provincial support policies to investors?
Canada's Response: The Canada Business Network is a collaborative arrangement between
federal and sub-federal government agencies to provide information to businesses.
Page 81, paragraph 3.117
[China Question 31]: The report states that "The Business Development Bank of Canada, a federal
crown corporation reporting to Industry Canada, provides financing and other services to
businesses, in particular, SMEs, to promote investment in and development of Canadian
businesses."
Is the Business Development Bank of Canada funded by government appropriation or commercial
financing?
Canada's Response: BDC does not receive appropriations from the Government of Canada. Like
private sector financial institutions, its operations are financed through borrowings on the open
market, share capital and retained earnings generated by the Bank. All shares of the Bank are
owned by the Government, which receives an annual dividend on them.
[China Question 32]: What is the major mandate of the Bank, to achieve relevant government
policy objectives or to maintain its business and gain profit?
Canada's Response: BDC's mandate is to support Canadian entrepreneurship, giving particular
consideration to the needs of small- and medium-sized enterprises (SMEs). It has a public policy
mandate to achieve relevant government policy objectives and fill market gaps. However, it is also
required to operate in a financially sustainable manner by earning a return on equity at or above
the government's long-term cost of capital. BDC has been profitable every year since 1995 and it
pays annual dividends to the Government of Canada.
[China Question 33]: How does it strike a balance between these two goals, especially when the
global financial crisis increases the credit risks of export?
Canada's Response: BDC works to achieve a proper balance between its public policy mandate
and its requirement to be financially sustainable. It operates as a complementary lender in the
market, offering support that fills out or completes services available from the private sector. It
fulfills a counter-cyclical role by increasing financing during periods of economic turbulence, when
the private sector tends to restrict its financing. For example, during the 2009 global financial
crisis, the approval rates of private banks for smaller firms (with 1-99 employees), decreased to
79 percent, a 15 percent decrease from 2007 and one of the lowest approval ratings of the
decade. In response, BDC extended a record amount of financing in fiscal year 2010, increasing its
loans volume from $2.8 billion to $4.3 billion. As the economy moves to more normal credit
conditions, BDC moderates its activity levels to ensure that its support continues to be incremental
to that available from the private sector.
As private banks will not typically approve loans above a certain risk level, BDC aims to share risk
with banks and partner on deals, to ensure that SMEs are able to access the financing they need.
In financing riskier transactions, BDC prices according to risk, assigning higher interest rates as
transaction risks increase. Its clients often require smaller loans and more flexible repayment
terms than other business borrowers. BDC is a patient lender and can offer longer amortization
periods and payment holidays to help SMEs get their projects off the ground or stay on track. Its
Business Restructuring Unit helps clients save their business and supports them through the
difficult decisions needed to turn things around. BDC's pricing reflects the creditworthiness of the
borrower and the loan repayment terms.
3.3.4.2 Federal Crown Corporations
Page 87, paragraph 3.134
WT/TPR/M/314/Add.1
- 14 -
[China Question 34]: The report states that "Crown corporations are subject to the governance
and accountability framework set out in the Financial Administration Act (FAA), and in some cases,
their own constituent Acts. There are both self-financing Crown corporations, as well as those
which receive government appropriations."
What mechanism is adopted by Crown corporations to maintain a balance between realizing
national policy goals and gaining commercial profits?
Canada's Response: All Canadian federal Crown corporations derive their raison d'être from their
statutory role as instruments of public policy on behalf of the Government of Canada. A large
number of Crown corporations operate in a business environment where it may be challenging to
manage both commercial and public policy objectives.
The accountability frameworks under which Crown corporations operate are set out in Part X of the
Financial Administration Act and specific constituent Acts. These frameworks provide the necessary
balance to accommodate the tensions managing both commercial and public policy objectives set
out in the mandates of each Crown corporation.
The FAA gives Crown corporations a degree of managerial autonomy in order that they may
pursue commercial and public policy goals with minimum direct government involvement. To
balance this managerial autonomy, it is necessary that both Parliament and the Government be
kept fully informed of the results of Crown corporation operations and financial conditions through
the provision of comprehensive and effective reporting documents, specifically annual corporate
plans and performance reports.
Through the corporate plan process set out in legislation and regulation, the activities and budgets
(capital and operating budgets) of most Crown corporations are reviewed and approved on an
annual basis by the Treasury Board in its role as a Cabinet Committee, and in its role acting on
behalf of the Governor in Council. This annual review is designed to ensure that a Crown
corporation's activities are within its mandate, that it is achieving expected results, and that it is
providing value for money for Canadians. Where these objectives are not being met, mandates can
be amended through legislation; funding mechanisms, financing restrictions or dividend plans can
be changed; or, at the prerogative of the Prime Minister, the corporation can ultimately be
dissolved.
Summaries of approved corporate plans and budgets are subsequently tabled in Parliament and
become public documents. Crown corporations are also required to submit an annual report, which
although not approved by a Cabinet Committee, is tabled in Parliament by the Minister designated
as responsible for each Crown corporation.
4 TRADE POLICIES BY SECTOR
4.2.1 Policy developments
Page 125, paragraph 4.63
[China Question 35]: The report states that "Since 2009 Canada has a corporate social
responsibility (CSR) strategy for the extractive sector. This policy is put in place to encourage all
Canadian firms working internationally to respect laws, operate transparently, consult with host
governments, and implement CSR best practices. "
What are the specific incentives in the CSR strategy to encourage firms, especially those operating
internationally to implement CSR best practices?
Canada's Response: The Government of Canada expects Canadian companies operating abroad
to respect all applicable laws and international standards, to operate transparently and in
consultation with host governments and local communities, and to conduct their activities abroad
in a socially and environmentally responsible manner.
Incentives in Canada's enhanced 2014 CSR Strategy: As mentioned in section 2.1.1 (para 2.10) of
the Report, the Government of Canada released an enhanced CSR Strategy for the Extractive
Sector in November 2014. The Government has clearly signalled the importance it attaches to the
WT/TPR/M/314/Add.1
- 15 voluntary participation of Canadian companies in dispute resolution mechanisms, and to good CSR
performance.
Dialogue facilitation and non-judicial dispute resolution processes can be crucial to the long-term
success of projects abroad and the sustainability of host communities. Canada offers two
mechanisms to help communities and Canadian companies resolve differences: the review process
of the Office of the Extractive Sector CSR Counsellor; and the issue resolution function of Canada's
National Contact Point (NCP) for the OECD Guidelines for Multinational Enterprises. The 2014 CSR
Strategy makes explicit the link between company participation in dialogue facilitation mechanisms
and eligibility for trade advocacy services from the Government of Canada.
Under the enhanced Strategy, if a company refuses to participate in one of Canada's two dialogue
facilitation mechanisms, it will not receive such support. Decisions by Canadian companies to
participate in the review processes of the Counsellor's Office or the NCP remain voluntary, but a
decision not to participate will now be made public. They will also be taken into account in the
CSR-related evaluation and due diligence conducted by the Government of Canada's financing
crown corporation, Export Development Canada (EDC), in its consideration of the availability of
financing or other support.
Legal incentives: Canadian companies must also comply with two Canadian laws aimed at
combatting bribery and improving transparency globally. The first is the Corruption of Foreign
Public Officials Act (CFPOA), which implements Canada's obligations under the OECD Anti-Bribery
Convention by making it a criminal offence in Canada to bribe foreign public officials in the course
of international business, and which was strengthened in June 2013.
The second is the Extractive Sector Transparency Measures Act (ESTMA), passed in December
2014, and which is designed to deter corruption through transparency measures that require the
reporting of certain payments made to all levels of governments domestically and abroad. The
ESTMA will require extractive entities that are engaged in the commercial development of
minerals, oil or natural gas, and subject to Canadian law, to report annually on specific payments
of $100,000 or more made to any level of government in Canada or abroad, including Aboriginal
governments.
Both of these Acts are referenced in the 2014 enhanced CSR Strategy as a way to strengthen the
environment affecting business activities abroad in a way that is conducive to advancing CSR
performance and benefits on the ground.
4.2.2.2 Natural Gas
Page 129, paragraph 4.74
[China Question 36]: The report states that "While Canada is not yet exporting LNG, current
proposals have an expected export capacity of 302 million tonnes per year, which is equivalent to
40.8 billion cubic feet of natural gas per year and almost 3 times current natural gas production.
Thus, according to the authorities, it is not expected that all these proposals will be approved or
developed."
Why did Canada fail to export LNG and please give an update of the regulatory review of LNG
export applications?
Canada's Response: As natural gas supplies and reserves continue to increase in North America,
Canadian producers are seeking ways to access new markets by exporting liquefied natural gas to
Asia and Europe. However, Canada does not yet export LNG, since Canada does not yet have the
necessary infrastructure in place (liquefaction plants, export terminals) for such exports.
To date, 24 LNG export projects have been announced, 19 in BC and 5 in Eastern Canada. Each of
these projects is at a various stage of regulatory review.
LNG export project proponents typically seek LNG export licences to support their projects and
their discussions with potential LNG buyers. LNG export licences require two approvals. First, an
applicant who wishes to obtain an LNG export licence must apply to the National Energy Board
(NEB), a federal agency that is independent of the elected Government. If the NEB approves the
WT/TPR/M/314/Add.1
- 16 licence, the decision next goes to the Government of Canada. If the Government also approves the
licence, the Government then directs the NEB to issue the licence to the applicant.
Since 2011, following both NEB and Government of Canada approvals, the NEB has issued 10 long
term LNG export licences to Canadian projects for a total of 155 million tonnes per annum of LNG
exports.
The NEB has approved another export licence which requires Governor in Council approval before
it can be issued. An additional twelve applications are under review by the NEB.
At least one project, Pacific Northwest LNG, has publicly announced that it will be making a final
investment decision for its project in 2015. Other projects are also advancing to towards a final
investment decision. It is expected that Canada will be exporting LNG to overseas markets by
2020.
To support such exports, Canada's plan for Responsible Resource Development is helping to create
a competitive investment environment for the LNG industry by:
•
•
•
Creating a competitive tax regime;
Establishing a world class independent regulatory process that makes sound decisions
based on science and the facts;
Providing clear timelines for investors and reducing duplication across jurisdictions;
•
Extending the maximum length of natural gas or LNG export licences from 25 years to
40 years to improve regulatory certainty for natural gas or LNG exporters; and,
•
Strengthening environmental protection and the safety of our energy transportation
systems to build confidence in Canada's ability to develop its resources safely and
responsibly.
4.3.1.2 Regulatory framework
Page 136, paragraph 4.98
[China Question 37]: The report states that "The Bank of Canada assesses financial stability risk
and oversees systemic payment, clearing and settlement systems."
Please introduce the distribution of labor between the Department of Finance and the Bank of
Canada, as they are both responsible for overseeing financial risks.
Canada's Response: The Minister of Finance has overarching authority over federal financial
sector legislation and responsibility for all matters related to the financial affairs of Canada,
including the overall stability of the financial system. The Department of Finance supports the
Minister in fulfilling this role by providing policy advice and analysis on domestic and international
financial stability issues, including issues related to oversight of the financial sector and financial
institutions.
The Bank of Canada contributes to the long-term resilience of the Canadian financial system by
providing central banking services and conducting and publishing analysis and research. The
Financial System Review, a biannual report detailing the key vulnerabilities and risks to the
stability of the Canadian financial sector, is one avenue where the Bank promotes discussion on
financial system issues.
The Senior Advisory Committee (SAC), a forum composed of senior officials from the Department
of Finance, the Bank of Canada, the Office of the Superintendent of Financial Institutions, the
Canada Deposit Insurance Corporation, and the Financial Consumer Agency of Canada, meets
regularly to discuss financial stability issues and risks. The exchange of views among financial
sector agencies on specific risks informs the advice provided to the Minister on legislative,
regulatory and policy issues affecting the sector.
WT/TPR/M/314/Add.1
- 17 Report by Canada – (WT/TPR/G/314)
1 TRADE AND ECONOMIC POLICY ENVIRONMENT
1.1 Economic Overview
Page 4, paragraph 1.5
[China Question 38]: The statement states that "Monetary policy provided important stimulus
during the global recession and continued to do so up to the present time."
As the overall global economic environment gradually improves, does the Bank of Canada have a
plan to tighten monetary policy to some extent?
Canada's Response: The Bank's mandate is to conduct monetary policy to promote the economic
and financial well-being of Canadians.
•
Canada's experience with inflation targeting since 1991 has shown that the best way to foster
confidence in the value of money and to contribute to sustained economic growth, employment
gains and improved living standards is by keeping inflation low, stable and predictable.
•
The current target, as measured by the total consumer price index (CPI), is at the 2%
midpoint of the control range of 1 to 3%.
•
Seeing through various temporary factors, the Bank currently estimates that the underlying
trend of inflation is 1.6 to 1.8%, consistent with persistent slack in the economy.
•
As indicated in the Bank's latest Monetary Policy Report (April 2015), the negative effects of
the oil price shock on the Canadian economy are materializing rapidly. Underneath the effects
of the oil price shock, the natural sequence of stronger non-energy exports and investment is
progressing. This sequence will be bolstered by the considerable easing in financial conditions
that has occurred and improving U.S. demand. Therefore, the Bank expects the Canadian
economy to return to full capacity around the end of 2016.By then, both total and core inflation
are projected to be close to 2% on a sustained basis.
In its latest interest rate announcement on 27 May, the Bank noted that although a number of
complex adjustments are under way, its assessment of risks to the inflation profile had not
materially changed since the April Report. Risks to financial stability remain elevated, but appear
to be evolving as expected. Weighing all of these risks, the Bank judged that the current degree of
monetary policy stimulus remains appropriate and therefore maintained the target for the
overnight rate at 3/4%.
With respect to the Bank's intentions regarding interest rates, Governor Poloz has indicated that
forward guidance should be seen as a useful tool in the central banker's kit, but one that should be
reserved primarily for use at the zero lower bound, as a form of additional insurance that the
economy will return to equilibrium. (Stephen S. Poloz, "Integrating Uncertainty and Monetary
Policy-Making: A Practitioner's Perspective," Bank of Canada Discussion Paper 2014-6, October
2014)
That said, one would anticipate that over time, as the Canadian economy returns to more
sustainable, balanced growth, policy rates will eventually be higher.
The Bank remains transparent about the factors it takes into account when making monetary
policy decisions. These factors are discussed in its Monetary Policy Reports and Financial System
Reviews, as well as frequent public speeches by members of the Bank's Governing Council.
1.2 Global Market Action Plan
Page 6, paragraph 1.14
[China Question 39]: The statement states that "The GMAP focuses on helping small and mediumsized enterprises (SMEs) find success internationally, and sets ambitious targets for growing the
footprint of Canadian SMEs in emerging markets. It aims to increase the number of SMEs
WT/TPR/M/314/Add.1
- 18 exporting to emerging markets from 11,000 to 21,000 by 2018. This would mean that the share of
SMEs exporting to these markets would rise from 29% to 50%."
Please illustrate the progress of the GMAP since it was launched.
Canada's Response: Since its launch in November 2013, the Government of Canada has reached
several milestones in achieving progress under the GMAP, including:








implementation of the Canada-Korea Free Trade Agreement;
conclusion of negotiations of the Canada-EU Comprehensive Economic and Trade
Agreement;
announcement of a new export market development program of $50 million over five
years in assistance to entrepreneurs for activities such as market research and
participation in trade fairs and missions;
announcement of the expansion of the Trade Commissioner Service (TCS) with
approximately twenty additional Trade Commissioners to target priority markets;
launch of the International Education Strategy (January 2014), the Defence Procurement
Strategy and associated Export Strategy (February 2014), and the Strategy for the
Extractives Sector (November 2014);
a series of "Go Global" workshops hosted by the Minister of International Trade to
encourage small and medium-sized enterprises (SMEs) to take advantage of international
business opportunities, has attracted over 2,000 participants in 18 events across Canada;
launch of Canadian Technology Accelerators in the UK, France and India, in addition to
those existing in the U.S., to facilitate high potential technology-based Canadian
companies' pursuit of business opportunities;
establishment of 27 formal partnerships between the TCS and private sector associations
designed to strengthen linkages; and opening of four new trade offices in China, as
announced in May 2014.
Page 7, paragraph 1.22
[China Question 40]: The statement states that "Strategy for the Extractive Sector
(November 2014): Building on Canada's plan for Responsible Resource Development, this strategy
ensures that mining and energy will continue to represent an engine of economic growth and
prosperity for Canadians. The strategy supports the export of both equipment and services in the
extractive sectors."
Please introduce the specific policies of Canada to support the export of equipment and services in
the energy and mining sectors.
Canada's Response: The Government of Canada's Extractive Sector Strategy, for both the
mining and oil & gas sectors, coordinates efforts, including through support provided by the
government of Canada's "economic diplomacy," to help generate business success and fuel
prosperity for Canadians as well as host governments and local communities abroad. The four
pillars of the strategy are: securing and preserving access to international markets; transforming
business opportunities into business successes; sustaining the business environment and local
communities; and producing economic benefits for Canadians. The strategy includes efforts to
continue to provide direct assistance to Canadian exporters of equipment and services in the
mining and oil & gas sectors. This includes the work of both the Canadian Trade Commissioner
Service and Export Development Canada's network across Canada and abroad.
The Canadian Trade Commissioner Service (TCS) plays a valuable role in assisting Canadian
companies, including equipment and service providers in the mining and oil & gas sectors, in their
endeavours abroad. The TCS offers four key services in support of its Canadian business
clients. These services are designed to reduce market risks related to knowledge, cost and
distances and as well as cross-cultural barriers. The TCS helps companies prepare for international
markets, provides current market assessment, finds qualified contacts in-market and helps resolve
business problems.
Export Development Canada's (EDC) mandate is to support and develop, directly or indirectly,
Canada's export trade and Canadian capacity to engage in that trade, as well as respond to
WT/TPR/M/314/Add.1
- 19 international business opportunities. This includes, among others, opportunities in the mining and
energy sectors where EDC supports Canadian exporters, including those expressing an interest in
emerging markets.
2 TRADE POLICY DEVELOPMENTS (2011-15)
2.1.1 Doha Development Agenda
Page 8, paragraph 2.3
[China Question 41]: The statement states that "Canada demonstrated its support for the DDA by
working together with other members in reaching a successful outcome at the WTO's Ninth
Ministerial Conference in Bali, Indonesia in December 2013. In particular, Canada strongly
supported the Trade Facilitation Agreement and is committed to its timely implementation."
China appreciates the long-time active participation of Canada in various WTO activities. Please
introduce the progress in the domestic ratification of the WTO Trade Facilitation Agreement.
Canada's Response: Canada's Economic Action Plan 2015 reaffirmed Canada's commitment to
undertake the steps necessary to ratify and implement the TFA. Canada's ratification process
includes tabling the TFA in Parliament for a period of 21 sitting days, legislative amendments,
which could be initiated following completion of the tabling period, and once legislative
amendments are complete, seeking the necessary authority for Canada to submit its instrument of
acceptance to the WTO.
Canada is currently working to ratify the agreement as soon as possible. Canada's Minister of
International Trade tabled the TFA in Parliament on May 13. Canada will deposit its instrument of
acceptance to the WTO following completion of the tabling period, introduction and passing of
legislative amendments, and issuance of necessary authorizations.
2.7 Trade promotion
Page 20, paragraph 2.81
[China Question 42]: The statement states that "Canada manages 161 trade offices in Canadian
embassies and consulates located in 107 countries around the world, as well as five regional
offices and an innovative network of trade commissioner satellites co-located with public and
private sector partners across Canada."
Please briefly introduce the management and operation modes of Canada's trade offices. How do
trade offices and regional offices define their respective functions?
Canada's Response: As part of Foreign Affairs, Trade and Development Canada, the Canadian
Trade Commissioner Service (TCS) helps Canadian companies and organizations succeed globally.
Created in 1894, the TCS has more than 120 years of experience helping Canadian companies
succeed in foreign markets by promoting the economic interests of Canada in the global
marketplace. Trade offices are located across Canada and in 161 offices around the world.
Canada's international trade offices, located in Canadian embassies and consulates, are mandated
to enable and contribute to Canada's prosperity through the provision of trade promotion support
services to Canadian businesses, helping them to identify and capitalize on opportunities in the
global marketplace. The main value proposition is the on-the-ground intelligence and networking
resources that uncovers market opportunities, makes introductions, facilitates business and, where
necessary, troubleshoots. The TCS also promotes Canada as an investment destination for foreign
companies and as a partner for innovation and commercialization.
The TCS offers the following four key services in support of its Canadian business clients. These
services are designed to compensate for or correct market failure risks related to knowledge, cost
and distances, as well as cross-cultural barriers:
1) Preparation for International Markets: Refining clients' international business strategies to
maximize their potential for international business success.
WT/TPR/M/314/Add.1
- 20 2) Assessing Market Potential: Helping clients assess the likelihood of achieving success in their
target markets, including understanding the subtleties of local regulations, business
environment and practices.
3) Finding Qualified Contacts: Identifying and qualifying local contacts to assist clients in pursuing
their market strategy. Examples include potential buyers, partners, supply chain managers,
researchers, decision makers and influencers.
4) Problem Solving: Providing advice and assistance in resolving business problems ranging from
customs clearance to issues related to the expropriation and sale of assets.
The TCS Regional Network is the domestic arm of the Trade Commissioner Service consisting of
five Regional Office Hubs plus an expanded network of Client Service Satellites (co-located Trade
Commissioners). Serving clients in every province and territory of Canada, the core business is to
engage high-potential clients in proactive sectors and provide customized and sustained
international business development service. Regional Office Hubs are established in Vancouver
(Pacific and Yukon Region), Calgary (Prairies and Northwest Territories), Toronto (Ontario),
Montreal (Quebec and Nunavut Region), and Halifax (Atlantic Region) to provide the TCS global
network with direct access and connection to high potential clients in proactive sectors. Client
Service Satellites are co-located Trade Commissioners with host partners. They offer clients and
the TCS global network added insight gained by their co-location. These Trade Commissioners are
autonomous from the partner and report to a Regional Director.