House of Commons Hansard #111 of the 40th Parliament, 3rd Session. (The original version is on Parliament's site.) The word of the day was vehicles.

Topics

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

December 6th, 2010 / 3:40 p.m.

Thornhill
Ontario

Conservative

Peter Kent Minister of State of Foreign Affairs (Americas)

moved that Bill S-5, An Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999, be read the second time and referred to a committee.

Mr. Speaker, I am pleased today to present an amendment to change both the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999. These changes are being proposed in order to bring Canada into compliance with the automotive provisions of the North American Free Trade Agreement, known as NAFTA. These amendments will address the importation of used vehicles from Mexico in a manner that continues to both preserve the safety of Canadians and to protect our precious environment.

Although the North American Free Trade Agreement was signed in 1993, its provisions on the importation of used vehicles only came into effect on January 1, 2009. These provisions require that Mexico, the United States and Canada allow the importation of used vehicles from one another's countries. The requirement is to be implemented in a phased manner by each of the countries. The allowable importations will start with vehicles that are 10 years old and older. The age threshold for the vehicles will decrease by two years, every two years, until 2019 when countries may not adopt or maintain a prohibition or restriction on imports of used vehicles from each other.

The current wording of the Motor Vehicle Safety Act does not allow for this importation.

The Motor Vehicle Safety Act is the key enabling legislative tool that regulates the manufacture and importation of motor vehicles and motor vehicle equipment in order to reduce the risk of death, injury and damage to property and to the environment. It is the tool that the government uses to provide direction to manufacturers, to importers and to the general public, thus allowing us to work together to continually increase the level of road safety in Canada.

This act sets out a comprehensive minimum safety standard for vehicles manufactured or imported for use into Canada. It also sets the standards for new tires and for equipment used in the restraint of children and disabled persons within the vehicle. The Motor Vehicle Safety Act first came into effect in 1971, and was last amended in 1993.

The Motor Vehicle Safety Act enables the development of the motor vehicle safety regulations and the Canada motor vehicle safety standards. These regulations and standards help to ensure the current and the ongoing safety of Canadians on our roadways.

The Canadian Environmental Protection Act, 1999, came into force on March 31, 2000, following an extensive parliamentary review of the original l988 act. The Canadian Environment Protection Act, 1999 is the government's principal legislative tool to prevent pollution in order to protect the environment and human health. It provides a comprehensive approach to reducing harmful emissions from vehicles and equipment by considering vehicles, engines and fuels as integrated systems.

Even with a modern, efficient piece of legislation such as the Canadian Environment Protection Act, 1999, amendments are required from time to time to keep pace with various international commitments, such as the North American Free Trade Agreement. We believe it is important to move swiftly to meet our international commitments and to be compliant with the North American Free Trade Agreement. We believe it is also essential to demonstrate our continued good faith and to maintain our reputation with our trading partners.

Both the United States and Mexico have regimes in place that allow for the importation of these used vehicles.

Prior to the automotive provision of the North American Free Trade Agreement coming into force, the American government already had a program where it considered requests for importation of vehicles from other countries. A determination is made for each individual vehicle to see if it can be modified to meet American safety standards; therefore, its rules did not need to change in order to meet the North American Free Trade Agreement requirements.

On December 22, 2008, the President of Mexico issued a decree allowing for the duty-free entry of used light and heavy-duty weight vehicles from Canada and the United States that are 10 years old or older into Mexico. This decree entered into force on January 1, 2009.

I think all members of the House recognize the importance for Canada to meet its reciprocal obligations. Making these changes to the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999 will help to fulfill these commitments to our trading partner.

While there has not been a free trade challenge from Mexico so far, if we do not proceed with these changes, it raises the possibility of a challenge arising, as well as other retaliatory trade actions.

As such, I am proposing today that the Motor Vehicle Safety Act be amended to allow the importation of used vehicles from Mexico. This importation would be contingent on the condition that the vehicles can be modified to meet the Canadian safety and emission standards.

Vehicles imported for use in Canada that are 15 years old or older are not required to meet safety or emissions standards. These older vehicles have essentially been collectors' items, falling into the vintage vehicle category. Currently, under the Motor Vehicle Safety Act, for vehicles that are less than 15 years old, only those from the United States may be imported.

Subsection 7(2) of the current Motor Vehicle Safety Act allows for the importation of used vehicles purchased in the United States. We are proposing to modify it to include the importation of used vehicles from Mexico.

Changes to those subsections would also require that within a prescribed period the vehicle must be made to conform to the safety requirements and that it be inspected in accordance with our regulations. Finally, a condition would set out that before the vehicle is presented for licensing under the laws of any province, the vehicle would be certified in accordance with the regulations to so conform by any person who is designated by the regulations.

Our proposal also includes changes to the Motor Vehicle Safety Act with respect to the definition of “vehicle”. Currently the definition states:

any vehicle that is capable of being driven or drawn on roads by any means other than muscular power exclusively, but does not include any vehicle designed to run exclusively on rails.

This definition would change to “any vehicle that belongs to a prescribed class of vehicles”.

The purpose of this change would be to more closely align the definition in the Motor Vehicle Safety Act with that in the Canadian Environmental Protection Act, 1999. This change would be necessary since both acts regulate the automotive industry and the difference in the definition of vehicles could lead to confusion for the industry.

These amendments would increase choice for Canadian consumers by providing them additional importation options of specified used vehicles from Mexico. The modifications would also maintain the continued safety of the Canadian public by ensuring the timely modification of the vehicles to comply with Canadian motor vehicle safety standards, thereby ensuring the safety of the Canadian public.

I must emphasize that the safety of Canadians and all people travelling on Canadian roadways remains our first priority. While on the surface it may seem harmless to allow individuals to import non-conforming vehicles, it nevertheless has an incremental impact on the safety of other Canadian road users.

Canada has different driving conditions than other parts of the world, including Mexico. As such, our safety standards are developed to meet our own needs, while still harmonizing where appropriate. For example, our vehicles have a requirement for daytime running lights to deal with lower lighting levels in the winter, our speedometers need to measure vehicle speed in kilometres, and the mechanism to attach child restraints to the vehicle is stronger than required in most other countries except in the U.S.

Canadian vehicle safety standards are designed to minimize, to the extent reasonably possible, the risk of death, injury or collision resulting from vehicles and their use. While they may be similar, and in fact are frequently harmonized with those of the United States, Canadian standards reflect the unique circumstances of Canada.

The safety of Canadians remains paramount to the Government of Canada. As such, stringent requirements would be put in place to ensure that the safety of Mexican imported vehicles is equivalent to that provided by vehicles sold in Canada. The imported Mexican vehicles would be required to meet either the Canadian or American safety standards that were in place at the time of manufacture.

In 1995, in order to monitor and regulate the importation of vehicles from the United States, Transport Canada established the registrar of imported vehicles, under the purview of the Canada-United States Free Trade Agreement. This importation process ensures that vehicles purchased by Canadians at the retail level in the United States are made fully compliant with the Canadian federal vehicle safety requirements before these vehicles are presented for provincial and territorial licensing.

The registrar of imported vehicles is operated by a private contractor and is funded on a cost-recovery basis through fees charged to Canadian importers. In 2009, 124,000 used vehicles were imported into Canada from the United States.

In order to ensure that vehicle imports from Mexico meet Canadian safety requirements, the current registrar of imported vehicles program will be extended to cover those vehicles. This extension will not impose any additional cost on the Canadian taxpayer, given the cost-recovery system of the registrar.

The Canadian Environmental Protection Act, 1999 and its regulations allow the importation of used vehicles into Canada from the United States provided they meet Canadian or United States standards at the time of their manufacture. Amendments are required to the Canadian Environmental Protection Act, 1999 to provide the authority to develop regulations to address the importation of used vehicles from Mexico that are not compliant with Canadian standards at the time of their importation. These regulations will be developed with respect to North American free trade obligations, and any vehicles imported into Canada from Mexico will be required to be modified in compliance with the Canadian emission standards.

The amended Canadian Environmental Protection Act, 1999 provisions will allow the importation of used vehicles from Mexico that are not compliant with Canadian standards. However, the person importing the vehicle will need to make a declaration stating that the vehicle will be made to comply with the requirements, that an inspection will be carried out if required, and that the vehicle will be certified before it is presented for licensing.

As such, the revisions to the act will maintain Canadian environmental standards and not result in higher emissions than if the vehicles had originally been manufactured to those standards.

To ensure that used cars arriving from Mexico respect the emissions standards of Canada, an implementation program will be put in place. It will be consistent with the one put in place by Transport Canada and could include steps such as the review of supporting documents and inspections of imported vehicles.

As part of the regulatory process, consultations with stakeholders will be undertaken on the development of regulations allowing the importation of used vehicles from Mexico.

It should be noted that it is estimated that a minimum of one year to a maximum of two years after proclamation will also be needed to design the regulations and an implementation program under the Canadian Environmental Protection Act, 1999. I would note as important information that imported used vehicles from the United States meet Canadian environmental emissions standards because Canadian emissions standards are harmonized with those of the United States. As such, vehicles that comply with U.S. standards also comply with Canadian standards. Imported American vehicles bear the United States emissions control label.

Consultations on changes to the Motor Vehicle Safety Act started in 2002, with the release of a discussion paper. A range of potential changes to the Motor Vehicle Safety Act have been examined over the years, and the act is currently being assessed against today's operating environment.

However, given that we are not currently compliant with the North American Free Trade Agreement, we believe we should start with addressing this potential trade issue in advance of any other challenges. This will bring us into compliance with the North American Free Trade Agreement and avoid the possibility of a challenge by the Government of Mexico.

We have also consulted provincial and territorial governments, given that the imported vehicles will be licensed and operated in Canada. I would note that they did not express any concerns. In addition, commercial importers are supportive of the proposed changes.

I would also note that we continue to monitor the current United States Senate and House proposals to change the United States' motor vehicle safety act.

In conclusion, we believe these modifications to the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999 are crucial to maintaining our obligations under the North American Free Trade Agreement, our goodwill with our trading partner, and our broader international trade reputation.

The impact of imported vehicles from Mexico should not have an effect on the Canadian manufacturing and retail market as the importations would be for used vehicles and, to start with, permit only the entry of older used vehicles.

These changes would be implemented in a manner that would maintain the safety of Canadians on our roadways by ensuring that imported used vehicles from Mexico meet our Canadian safety standards.

In addition, these changes would continue to protect our environment by ensuring that used imported vehicles from Mexico respect our emissions standards.

These amendments are the proper thing to do. They would maintain our trade relationships, have potential benefits for Canadians and continue to protect our safety and environmental interests.

I call on my fellow parliamentarians to support this bill unanimously.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4 p.m.

Liberal

Sukh Dhaliwal Newton—North Delta, BC

Mr. Speaker, I listened to the speech made by the hon. Minister of State of Foreign Affairs . He mentioned that this bill was due in 2009. We will be entering 2011 shortly. It seems like this delay has been caused either by the incompetence of the current government or by it being carried away by playing politics in Parliament with other stuff than the stuff that is equally important on the international stage, which should have been taken care of.

I would ask the member whether it was due to incompetence or is the government playing politics here in the House?

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4 p.m.

Conservative

Peter Kent Thornhill, ON

Mr. Speaker, certainly there was incompetence in this House and in the Government of Canada between the years 1999 and 2006.

However, I think the simple answer is that it was not required until now. There have been consultations, there have been studies and there have been considerations. The government, our government, feels that the time is now right to properly bring Canadian safety standards and environmental standards into full compliance with NAFTA.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4 p.m.

NDP

Jim Maloway Elmwood—Transcona, MB

Mr. Speaker, the member says that he has consulted with the importers and they do not have a problem with it. That is no big surprise. The people who are importing the cars would like to import more vehicles from wherever they can get them. The question is, has he talked to the motor dealers organizations in the country?

He says he talked to the provinces and they do not seem to have a problem with it. However, I can tell members that in my home city of Winnipeg, only a year ago, we had a situation, and I do not know if the member is familiar with this, concerning the lemon law. There have been lemon law schemes in the United States now going back 20 years to aid the consumer. If a consumer buys a lemon, the manufacturer has four attempts to correct the problem. If the manufacturer cannot correct the problem, the car is bought back.

What we found happening is car companies were reselling these lemons that they had to buy back in different states. This is an arrangement within the United States and Canada. So I do not know he is going to be able to track these things.

The other question I have for him is, does he have any idea of how many cars we are talking about here? It is my guess that it would be almost negligible because we are talking about used vehicles that are 10 years old and older.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4 p.m.

Conservative

Peter Kent Thornhill, ON

Mr. Speaker, my hon. colleague does raise a number of important considerations. However, he also answers his original question by noting that, as this will be phased in, it only does affect vehicles 10 years old or older. The number, as I referenced, with regard to current practice of used vehicles from the United States being imported into Canada, was a relatively small number compared with the number of new vehicles sold in this country.

So, yes, we have consulted extensively with the provinces, the territories, and the importers and we see no significant or negative impact on the Canadian auto industry.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4 p.m.

Liberal

Siobhan Coady St. John's South—Mount Pearl, NL

Mr. Speaker, I was interested to hear my hon. colleague talk about safety on our highways. I have a private member's bill that deals with just that for heavy duty equipment to have side guards. I hope he gives consideration to that.

I understand that this is an amendment that is required in order to bring Canada into compliance with international trade obligations under NAFTA and that how they are going to proceed with this to ensure safety on Canadian roads is that there will have to be compliance before they allow registration.

My question to the hon. member is, how is this going to be monitored? Registration is a provincial issue. Are there additional costs that are going to be borne by the provinces to ensure compliance? How is the federal government going to ensure that it is monitoring the situation?

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4 p.m.

Conservative

Peter Kent Thornhill, ON

Mr. Speaker, as I explained in debate, the registrar, which currently operates a cost recovery system with regard to used American vehicles being imported into Canada, will apply a very similar inspection compliance regime and cost recovery system so that there will be no negative impact on the Canadian taxpayer.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4:05 p.m.

NDP

Jim Maloway Elmwood—Transcona, MB

Mr. Speaker, the member would know that odometer rollback and replacement is basically theft and a form of fraud on the Canadian public. It is widespread and has been for years. We cannot even handle the issue in Canada. Cars with spun odometers are coming into the Manitoba market from Ontario and Quebec. It was only a dozen years ago that the provincial government brought in a tracking system and a history book that has to follow the car to establish its age and follow it through ownership changes. It has not really solved the problem of people replacing odometers. Spinning them is one thing but they are being replaced.

How are we going to police something like that if a vehicle comes in from another country like Mexico or even the United States when we cannot even deal with the problem on an interprovincial basis right here in Canada?

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4:05 p.m.

Conservative

Peter Kent Thornhill, ON

Mr. Speaker, the point that we have to make is that it is time for Canada to meet its commitments under the North American Free Trade Agreement, to become compliant with our other two trading partners. We have to recognize that in doing that, Mexico has very limited safety standards. These standards do not require safety provisions that vehicles on Canadian highways and byways must comply with. These imported used vehicles from Mexico will be made to comply to either Canadian or American safety standards as they now apply to used vehicles imported from the United States.

The Mexican vehicle population does include some vehicles today that are certified to U.S. safety and environmental standards and it is expected that this class of vehicles will be relatively easily adapted to meet Canadian regulations and provisions to be compliant. This process, which is already in place for used vehicles imported from the United States, will apply equally effectively to used vehicles from Mexico.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4:05 p.m.

Liberal

Sukh Dhaliwal Newton—North Delta, BC

Mr. Speaker, the minister mentioned that this will be phased over 10 years until 2019. The critics of this bill, my constituents and other Canadians, are asking questions. They think the bill will overwhelm our used car market.

Would the minister like to comment on this question that was raised by my constituents?

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4:05 p.m.

Conservative

Peter Kent Thornhill, ON

Mr. Speaker, when this legislation is passed we will turn to writing the specific regulations that will apply.

The member is quite right in remarking that it will initially apply only to vehicles 10 years or older and then every two years that will decrease until 2019. By that time we believe we will have brought the regulations into compliance with no adverse or negative impact on the Canadian used car market. It will ensure the safety of those who use Canadian highways and byways.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4:10 p.m.

Liberal

Sukh Dhaliwal Newton—North Delta, BC

Mr. Speaker, I would like to thank the hon. Minister of State of Foreign Affairs for the Americas for bringing this to the attention of the House and to Canadians. On the same lines, I rise today to speak about Bill S-5, Ensuring Safe Vehicles Imported from Mexico for Canadians Act.

I will admit that this is one of the more mundane issues that I and my fellow members are asked to speak on as part of our daily debates in the House, but the utility in the bill is very clear both in terms of our country's international trade obligations and the safety of our citizens.

In fact, even though Bill S-5 is described as updating laws to comply with NAFTA, I would argue that Bill S-5 is about putting the interests of Canadians first.

When it comes to the safety standards that Canada places on cars we are a more strict country than most others in the world. This has meant that many used cars that are being sold at the retail level in other countries do not always meet Canada's safety requirements. However, the United States also has very tough safety standards as the hon. minister mentioned earlier.

In the case of American cars, Canada requires a declaration from the importer that the car will be brought up to regulation before hitting the road. Mexico has been held to a different standard however. It is finally time for Mexican automobiles to be given the same opportunity as American vehicles to be imported into Canada.

Bill S-5 is about treating our free trade partners equally and creating a level playing field within the context of NAFTA. It is also about fulfilling the obligations that we agreed to in this treaty.

Bill S-5 amends the Motor Vehicle Safety Act to allow for Mexico to be brought up to that same treatment. But in doing this, it is important that Canada does not compromise its own standards, particularly when it comes to the safety of our citizens. This is how we arrive at Bill S-5 today.

NAFTA has created jobs, growth and a sense of internationalism between our three countries and it is important that we continue to show respect for the parameters we signed onto in 1993. This is the evolution of this trade agreement and it also demonstrates that Canada has the ability to maintain control of the priorities that we hold as important.

The first aspect of the bill is ensuring that vehicles are ready for the road and that they present no undue risk to Canadians. The second aspect of the bill has to do with ensuring these vehicles present no undue risk to the environment. I come from the riding of Newton—North Delta. In the backyard of my riding we have the Burns Bog. The citizens of my riding bring questions on the environment to me. On this particular issue there are the same questions that will be asked. I can assure them that if we are going to be allowing Mexican vehicles into this country based on a mere declaration, the act must be amended to allow for such a privilege, where we make sure that those safety standards and the environmental standards are up to speed and meet Canadian requirements.

The mechanics of the bill are far from exciting. These are the technical details that allow Canada to live up to our international obligations to ensure that NAFTA continues to propel the three partners forward.

Ultimately, as members of Parliament we have a more important obligation to our constituents. We have an obligation, as I mentioned earlier, to ensure that our roads are safe and that vehicles do not present a risk to drivers on the road. We also have an obligation to ensure that our environment be considered for our own health and for the health of future generations.

I would like to conclude with how an elementary issue such as this has been handled by the government. After taking two full years, and five full years into government, the Conservative government is finally realizing that we should fulfill our obligations.

Canada has had a commitment under NAFTA to our partner in Mexico since 1993 to change our laws and allow used Mexican cars. We were supposed to do it in 2009, as the hon. minister mentioned earlier, but here we are at the end of 2010 and it is still not done. Once again, this is a bill that was pushed aside because of prorogation and the government playing political games with the nation's agenda.

Canadians are tired of a government that looks at every issue as a means to achieve a political advantage. With the government, it is all the same, regardless of whether the issue is a major plank in its policy platform or a technical yet necessary bill like Bill S-5.

If Canadians wonder why the House seems so prone to dysfunction, they only need to look across at the tactics of the government to understand why.

It is time we put the priorities of the country first above all other considerations. I am glad that Bill S-5 was brought forward and that we will meet our international obligations. At the same time, we will ensure that Canadian drivers and occupants of vehicles are safe. Also, we want to ensure we protect the environmental standard for generations to come as they should be able to enjoy a better and cleaner environment.

I recommend that Bill S-5 be passed for second reading for due diligence. I look forward to ensuring that we as a country live up to our international obligations.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4:15 p.m.

NDP

Jim Maloway Elmwood—Transcona, MB

Mr. Speaker, the member is absolutely right, Bill S-5 will make Canada comply with NAFTA obligations to allow imports of used vehicles from Mexico, which already exists between the U.S. and Canada. However, right now vehicles from Mexico must be adapted to Canadian safety and emissions standards before being accorded into Canada.

The question becomes an issue with the importers. I was trying to ask the parliamentary secretary about this. I would bet that he has not consulted with a single motor dealer association member in the country on this issue. However, I can see a lot of problems with curbers. I am sure he knows the term, “curber”, and they are a big problem for motor dealer organizations in our country.

I think we will see a lot of abuse with curbers importing vehicles from Mexico with replaced odometer, spun odometers. I do not know what sort of regulations can be brought in force to stop it, but to me that is the exposure.

Overall, in terms of the general market, I really do not think there will be a lot of vehicles involved. I do not think we will see a lot of 10-year-old used Mexican vehicles brought up to Canadian standards and imported into Canada. I think it would be importers and curbers doing this type of activity.

Could the member comment on that.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4:20 p.m.

Liberal

Sukh Dhaliwal Newton—North Delta, BC

Mr. Speaker, I thank the member for Elmwood—Transcona on the work that he has done on the bill. As responsible representatives of our constituents, we are here to raise questions like those that the hon. member raised.

When the bill goes to the next stage, those questions must be answered by the government and the minister responsible so we are able to regulate inspectors there and have the process in place.

There will always be people who try to play with the system. We have to ensure there are strict regulations with a process in place to deal with those individuals, even though not many will be caught, as the hon. member mentioned. However, it will create more work for mechanics because we have the highest safety and environmental standards.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act
Government Orders

4:20 p.m.

NDP

Jim Maloway Elmwood—Transcona, MB

Mr. Speaker, the reality is we are dealing with Mexican vehicles that are 10 years old and older in a country with not as good a road structure as we have here. These vehicles will have to be upgraded to Canadian environmental standards and other standards that we require, which will be a barrier to much activity there. Also, there is the cost of transportation.

Transportation is a big issue. Even when bringing American cars here, the transportation costs are quite high.

If we are talking about importing cars from Mexico that are over 10 years old, I really do not see a market here at all except if one can buy the car cheap enough and then pay all those costs, one might find someone to buy it in Canada. People are not going to be able to do that unless they make the cars look a lot newer than it really are.

I suggest we talk to the motor dealers association of Canada. My guess is the government has not talked to anyone in the association. Perhaps when the bill goes to committee, we will have to send letters out to those dealers ourselves to get them involved so the government can hear their testimony.