Bill S-5 (Historical)

Ensuring Safe Vehicles Imported from Mexico for Canadians Act

An Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999

This enactment amends the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999 to allow, subject to certain conditions, the importation of certain used vehicles from Mexico in order for Canada to meet its free trade obligations.

Business of the House

[John Baird, Conservative, Ottawa West—Nepean, ON]

When members are called smug, they all cheer and applaud.

As for the business of the House, I believe the minister responsible for the Status of Women has a motion that she would like to move after I have concluded my response to the Thursday question. Following that, without anticipating the outcome of any vote of the House, there seems to be an appetite to allow members who will not be running in the next election to have two minutes each to make statements. Following these statements, we will continue with day one of the budget debate.

Tomorrow we will consider the last allotted day in this supply period. I do not know why the opposition coalition is talking about ending this very productive Parliament to force an unwanted and unnecessary election. Recent weeks have led me to conclude that this is the most dysfunctional Parliament in Canadian history.

Yesterday our Conservative government achieved royal assent for the following bills: Bill S-6 to eliminate the faint hope clause; Bill C-14 to provide hard-working Canadians some fairness at the gas pumps; Bill C-21 to crack down on white collar crime; Bill C-22 to crack down on those who would exploit our children through the Internet; Bill C-30, R. v. Shoker; Bill C-35 to crack down on crooked immigration consultants; Bill C-42 to provide aviation security; Bill C-48 to eliminate sentencing discounts for multiple murderers; Bill C-59 to get rid of early parole for white collar fraudsters, a bill the Liberal government opposed but the Bloc supported; Bill C-61, the freezing of assets of corrupt regimes; and Bill S-5, safe vehicles from Mexico. What a legacy for the Minister of Transport, Infrastructure and Communities.

The work of this Parliament is not done. There are a number of key and popular government bills that Canadians want. Next week, starting on Monday, we will call: Bill C-8, the Canada-Jordan free trade agreement; Bill C-46, the Canada-Panama free trade agreement; Bill C-51, investigative powers for the 21st century; and Bill C-52, lawful access.

Does the Minister of Justice ever stop fighting crime? He gets more and more done. In many respects, as House leader I am like the parliamentary secretary to the Minister of Justice.

Of course, we need to complete the budget debate to implement the next phase of Canada's economic action plan, a low tax plan for jobs and growth. Therefore, Tuesday we will debate day two of the budget, Wednesday we will debate day three of the budget and on Thursday we will debate day four of the budget. We have lots to do and I suggest to the members across that we turn our attention back to serving the interests of the public.

While I am on my feet, I would like to serve those interests by asking for unanimous consent for the following motion. I move that, notwithstanding any Standing Order or usual practices of the House, Bill C-49, An Act to amend the Immigration and Refugee Protection Act, the Balanced Refugee Reform Act and the Marine Transportation Security Act shall be deemed to have been read a second time, referred to a committee of the whole, deemed considered in committee of the whole, deemed reported without amendment, deemed concurred in at report stage and deemed read a third time and passed.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act

[The Acting Speaker, Conservative, Barry Devolin]

Resuming debate.

Pursuant to an order made Wednesday, December 15, 2010, Bill S-5, An Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999 is deemed read a third time and passed.

(Motion agreed to, bill read the third time and passed)

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Mr. Speaker, I want to begin by saying that the Bloc Québécois is in favour of Bill S-5. It is rare for us to say such a thing about a bill. Given its importance, we want to say that we are having a hard time understanding why the government took so long to introduce this bill, which has delayed the implementation of some provisions of NAFTA.

The purpose of this bill is to ensure that used vehicles from Mexico can now be among those imported to Canada. There was already an agreement in place for vehicles from the United States. Under NAFTA, used vehicles from Mexico must also be eligible for importation. This is important since we know that the Mexicans react a certain way.

I am drawing a parallel with the fact that we are requiring Mexican workers to have visas, particularly when they come to work in Quebec in the summer. Parliamentarians and former parliamentarians of Canada are being turned away at the Mexican border in retaliation. Mexico is taking a fairly tough stance. Its position is understandable since it does not believe that Mexican workers should have to have visas. However, a number of parliamentarians are leaving soon for Mexico and they may run into problems. Last year, former Liberal minister Hélène Scherrer was turned away at the Mexican border as retaliation by the Mexicans, who were applying the same rule.

It important to fix that situation, especially since it is still only a small problem. Vehicles coming from Mexico may be in good shape. The climate in Mexico is obviously very different from Quebec and Canada. So used vehicles may be in very good shape. This could mean good deals for people here, as long as automobile regulations and Canada's safety regulations are respected, obviously. There probably are not a lot of them, but we do not want to import clunkers that will endanger those driving them and those sharing the roads with these vehicles. Safety and environmental standards must be met.

Will these vehicles be well equipped to deal with the rigorous winters in Quebec and Canada? Will their heating systems be good enough to defog the windows and defrost them in really cold weather? It is important to ask and address these questions before the vehicles get here.

As I said before, this could quite possibly lead to good deals for people here, and that is why we are supporting this bill, as long as the standards are respected.

From a more technical aspect, the primary purpose of Bill S-5 is to upgrade and comply with a NAFTA provision that is being phased in. But, as I said earlier, we are already two years behind because it should have been implemented on January 1, 2009. It is almost January 1, 2011. That is a delay of nearly two years.

Until very recently, Appendix 300-A.1 of NAFTA allowed Canada to prohibit imports of used Mexican cars. However, this restriction will be phased out, as the wording in the fourth paragraph of the appendix indicates.

According to the wording, Canada must allow imports of used vehicles from Mexico that are at least 10 years old beginning January 1, 2009. Then Canada has to allow imports of newer vehicles—those that are at least eight years old beginning January 1, 2011, then at least six years old beginning January 1, 2013, and so on until all used vehicles are allowed as of January 1, 2019.

Bill S-5 amends the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, which both govern the use and importation of used vehicles from the United States, but not from Mexico, which is why there is some confusion between Canada and the United States, and Canada and Mexico.

In the amendments, Mexican cars have been added and described as “prescribed vehicles”, since the phasing in of the NAFTA appendix allows Canada to regulate this import by restricting the age of the cars imported. In all cases, the used American or Mexican cars will have to comply with the requirements set by Canada. This is what I was emphasizing earlier. It is important to ensure that safety standards are respected, as well as standards regarding emissions and overall state of repair. We do not want any old clunkers; there are already too many on the road.

Failure to comply with NAFTA could result in economic retaliation by Mexico and therefore it is preferable that we conform to NAFTA quickly. That is why the Bloc Québécois will vote in favour of Bill S-5.

I would like to take this opportunity to wish everyone in my riding of Saint-Maurice—Champlain all the best of the season.

[Martha Hall Findlay, Liberal, Willowdale, ON]

Mr. Speaker, I am pleased today to rise on behalf of the Liberal Party to debate Bill S-5, An Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999.

The purpose of Bill S-5 is to amend these two statutes to allow for the importation of certain used vehicles from Mexico with certain conditions applied.

The amendments are required in order to bring Canada into compliance with its international trade obligations under NAFTA.

Bill S-5 was introduced in the other place on April 14, 2010, and successfully passed third reading on June 8. Simply put, Bill S-5 would bring Canada into compliance with our NAFTA obligations regarding the importation of used cars from Mexico.

Although NAFTA was signed approximately two decades ago several provisions were delayed by up to 20 years in some cases. This is one such provision, a provision that only came into force last year.

When NAFTA was signed Canada reserved the right to maintain all of our restrictions on used vehicles until January 1, 2009. Since then we have embarked on a 10-year process to phase out all of Canada's restrictions.

Currently when used vehicles are imported into Canada from the United States they do not have to meet our environmental and safety standards as they cross the border. However, the owner must commit to ensuring that before he or she registers and licenses the vehicle the necessary repairs and upgrades are made so that the vehicle will be compliant, as we would all expect them to ensure compliance with our safety and environmental regulations.

I would argue that this is a very straightforward concept. What is odd is that the same permission is not granted to vehicles being imported from Mexico, despite the fact that Mexico is a NAFTA partner. It is this very incongruity that Bill S-5 attempts to rectify.

The bill deals specifically with two sets of regulations: Canada's vehicle safety regulations and Canada's environmental regulations. Both sets of rules are critical for the safe and clean operation of motor vehicles in Canada.

Used vehicles imported into Canada from any location absolutely must meet both our safety and environmental regulations. I do not think anyone in the House will oppose that concept. However, it does make sense for us to allow the importers of these used vehicles to bring them into Canada for the upgrades necessary to bring them up to our standards.

We want compliance with our environmental and our safety regulations. How that happens can either benefit certain people in Canada in terms of additional work and additional jobs for our auto mechanics, for example, or we could insist that that happens elsewhere and deny Canadian auto mechanics the ability to have access to this additional work.

I will stress, our concern is the safety of Canadians and the compliance with our environmental regulations. As long as that is done and as long as these cars are compliant or made compliant before they are registered and licensed, then that is a good thing for Canada. We would then argue for allowing them to come into the country first so that Canadian auto mechanics and Canadians have the opportunity for that work. Indeed, allowing this law to continue to prevent the work from being done in Canada only punishes those auto mechanics and other people who might benefit from that work. The only question I have is why it took the government so long to introduce these measures.

A similar story, these NAFTA exemptions were set to expire in 2009. Here we are at the end of 2010. We are on the verge of 2011 and we are only finally getting to this issue. The delay cannot be attributed to the opposition, as the government so often likes to do. Bill S-5 was only introduced in the Senate on April 14, 2010. It moved quickly through the other place, passing on June 8.

It is ultimately most important in the context of the bill that Canada live up to its NAFTA commitments. Bill S-5 will not weaken our environmental or safety laws. The health and safety of Canadians will not be compromised. Indeed, the benefits of Bill S-5 include allowing Canadian auto mechanics and others to benefit from this work. It is for these reasons that we support Bill S-5 and encourage its rapid passage.

[Brian Jean, Conservative, Parliamentary Secretary to the Minister of Transport]

Mr. Speaker, I am very pleased to rise today to speak to Bill S-5, which is an act that would amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999. This would actually allow used vehicles from Mexico that are less than 15 years old to be imported into Canada.

These amendments are very important because they would enable the Canadian government to meet our obligations, as a country, to the North American Free Trade Agreement and create greater choice in the Canadian vehicle market while maintaining the high safety and environmental standards that Canadians expect.

In order to facilitate the Canada-U.S. Free Trade Agreement with respect to vehicles, the Motor Vehicle Safety Act had to be amended in 1993 to enable the Canadian government to establish a regime to regulate and monitor the importation of vehicles under the purview of the Canada-United States Free Trade Agreement.

These changes actually resulted in the creation of the Registrar of Imported Vehicles. These changes to the act provided Canadians with more options in the vehicle market.

Following the implementation of the earlier Canada-U.S. Free Trade Agreement, the North American Free Trade Agreement was signed in 1992. The goal of the North American Free Trade Agreement was, of course, to eliminate barriers to trade and investment between the United States, Canada and Mexico. The agreement came into effect January 1, 1994, which created one of the world's largest free trade zones in the world. That is correct and, in fact, it laid the foundations for strong economic growth and increased prosperity for Canada and Canadians as well as the United States and Mexico.

Since the agreement came into force, the North American Free Trade Agreement has demonstrated how free trade actually increases wealth and competitiveness, delivering real benefits to families, especially here in Canada, to workers, to manufacturers and to consumers who have more choice, more competition, lower prices and a better selection.

It is important to honour the commitments defined in this agreement, as well as to actually deliver on the commitments of the result of the North American Free Trade Agreement.

While this agreement was signed in 1992, the automotive provisions did not come into effect until January 1, 2009.

Now, as with the Canada-United States Free Trade Agreement, importation of used Mexican vehicles would begin with older vehicles and gradually expand, over the next 10 years, to include all used vehicles.

Again, I would like to underscore that neither the North American Free Trade Agreement requirements nor the proposed amendments to the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999 affect the importation of new vehicles built specifically to Canadian standards, nor used vehicles that are over 15 years of age and are, thus, not subject to those standards.

Similar to what occurred under the Canada-U.S. Free Trade Agreement, the existing importation provisions in the Motor Vehicle Safety Act and the Canadian Environmental Protection Act need to be updated to comply with NAFTA, which makes sense, and to comply with some of the more strenuous provisions in NAFTA to which we have agreed.

Changes to these acts are necessary in order to implement a regime for regulating and monitoring used vehicles originating from Mexico, since the coming into force date of the North American Free Trade Agreement automotive provisions has obviously just passed almost two years ago.

There is, as a result, a heightened need to amend these two acts so that Canada becomes compliant with its trade obligations and is not subjected to a potential challenge under the North American Free Trade Agreement, which obviously would not benefit our country, our consumers or, generally, Canadians, nor would it benefit United States consumers.

Therefore, I appreciate the co-operation of all members here and all parties to get this bill through.

I want to stress, however, that the government's commitment to the health and the safety of all Canadians would not be compromised at all by these changes. Road safety and the environment are, as members know, matters that the Government of Canada treats extremely seriously. Only vehicles that meet these very high standards we have set for motor vehicle safety and the environment would be allowed into the Canadian fleet.

The government is committed to the goal of making Canada's roads the safest in the world, which includes, by extension, the need to keep our vehicles safe. Our road safety program that emanates from the Motor Vehicle Safety Act is actually based on mandatory performance-based regulations and safety standards and an industry self-certification program to attest that those standards are being met.

We conduct research to enhance the level of safety provided by regulations and we conduct independent compliance testing to verify that the safety standards are, indeed, being met. We hold manufacturers to account in this country. The government's job is to do that, and we are making sure that Canadians remain safe on the roads.

Vehicle safety is, of course, a key component of road safety, as I mentioned. The physical attributes of a vehicle work in conjunction with road infrastructure and with user behaviour to create a systems approach to minimize the number of road collisions and their impact on our society. Nothing has gone further for road safety in this country in the last 30 or 40 years than Canada's economic action plan, our answer to the world economic decline. Rehabilitated roads and investments in new roads certainly keep people safer because of less congestion and less wear and tear, et cetera, on vehicles themselves.

I have met with Transport Canada several times, and I can assure everyone that it is researching and developing new safety standards almost on a daily basis. It is investigating these things. For example, the department itself carefully studied the safety potential of electronic stability control, which of course, has been the rage in the news over the last several years. It did this for all new light vehicles sold in Canada and conducted a cost versus benefit study.

Based on the results from our studies, a new Canada motor vehicle safety standard was proposed, which would require such a system be installed on prescribed vehicles with a gross vehicle weight of 4,536 kilograms or less and manufactured on or after September 1, 2011. This is a big step toward the safety of our vehicles.

For people who are interested, this proposal was published in the Canada Gazette, part I, in March 2009. Based on stakeholder submissions, a final regulation was published in the Canada Gazette, part II, in December 2009. The implementation of this Canadian safety standard will reduce the number of collisions in which the driver loses control of the vehicle.

Once fully implemented, it will save hundreds of lives. That is correct. It will save hundreds of lives and prevent thousands upon thousands of injuries to Canadians on a yearly basis. It is great news, indeed, for Canadians and this was done in conjunction with Transport Canada to make sure Canadians stay safe on our roadways.

Our national road safety plan, road safety vision 2010, encompasses a large number of road safety program areas. Specific targets developed by federal, provincial and territorial governments include decreases in the number of road users killed or seriously injured and an increase in the rate of seat belt use and proper use of child restraints. Of course, everyone knows what we are doing as far as child safety goes.

I am pleased to note that we have indeed achieved significant success in reducing death and injuries on Canadian roads. By 2007, the number of deaths from unbelted occupant fatalities was reduced by almost 15% and the number of road users killed in crashes on rural roads by more than 15% when compared with deaths during the 1996-2001 period. The 2008 deaths and serious injuries tolls were 18% and 22% lower, respectively. That is great news and speaks to the hard work that Transport Canada does.

Even as the road safety vision 2010 plan is nearing its conclusion, the government continues to support this initiative and its successor plan, called road safety strategy 2015, and will work with its partners to continue to improve the safety of Canadian roads.

This government is getting it done for Canadians, keeping Canadians and roadways safe and looking to the future in partnership with the specialties of Transport Canada, et cetera. We are getting the job done.

[Diane Finley, Conservative, Haldimand—Norfolk, ON]

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

(Bill C-21. On the Order: Government Orders:)

December 14, 2010--Third reading of Bill C-21, An Act to amend the Criminal Code (sentencing for fraud)--Minister of Justice.

(Bill read the third time and passed)

(Bill S-5. On the Order: Government Orders:)

December 10, 2010--Minister of Transport, Infrastructure and Communities--Consideration at report stage of Bill S-5, An Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999.

(Bill concurred in at report stage)

The House resumed from October 29 consideration of the motion that Bill S-211, An Act respecting World Autism Awareness Day, be read the second time and referred to a committee.

Business of the House

[Gordon O'Connor, Conservative, Minister of State and Chief Government Whip]

Madam Speaker, there have been consultations and I believe you will find unanimous consent for the following motion. I move:

That, notwithstanding any Standing Order or usual practice of the House, Bill C-21, An Act to amend the Criminal Code (sentencing for fraud) be deemed read a 3rd time and passed; Bill S-5, An Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999, be deemed concurred in at report stage without amendment; a Member from each recognized party may speak for not more than 10 minutes on the third reading motion of S-5, that following each speech, there be a period of 5 minutes for questions and comments, after which Bill S-5 shall be deemed read a third time and passed; at the conclusion of Question Period on Thursday, December 16, 2010, if not already disposed of, Bill S-5 shall be deemed read a third time and passed; and the House shall stand adjourned until Monday, January 31, 2011, provided that, for the purposes of Standing Order 28, it shall be deemed to have sat on Friday December 17, 2010.

Transport, Infrastructure and Communities

[John McCallum, Liberal, Markham—Unionville, ON]

Mr. Speaker, I have the honour to present, in both official languages, the seventh report of the Standing Committee on Transport, Infrastructure and Communities, in relation to Bill S-5, An Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999.

The committee has studied the bill and has decided to report the bill back to the House without amendment.

[The Chair, Conservative, Merv Tweed]

Everything will stay the same. The only thing we're saying is we're not going to review the entire act; we're going to review this section of the act.

Mr. Bevington, just for your information, I've opened the meeting and announced that we're going to move to clause-by-clause on Bill S-5.

Although we don't have witnesses directly sitting at the table, we do have members from Environment Canada and Transport Canada who, if there are questions or outstanding issues, can come forward and answer.

Mr. Dhaliwal.

[The Chair, Conservative, Merv Tweed]

Welcome, everyone, to meeting 43 of the Standing Committee on Transport, Infrastructure and Communities.

Pursuant to the order of reference of Monday, December 6, 2010, we are studying Bill S-5, An Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999.

We are here today to do clause-by-clause on this bill.

Mr. Bevington has advised us that he may be 15 minutes late and has asked the committee to wait. I'm looking for direction from the committee.

[The Chair, Conservative, Merv Tweed]

I'm not sure that added a lot to the value of our commentary.

I'm going to suggest that on Thursday we will start the meeting with a review, in the hope of going to clause-by-clause on Bill S-5.

Mr. Jean.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

There's one further item of business, and I did want to talk to the committee about this. We finished up Bill C-42 a little bit early. What I'm proposing is that we consider moving immediately to Bill S-5, which has now been referred to our committee.

It's a very small bill. I know some of you are aware of it already. It's a bill, just one amendment, that will allow Transport Canada and Environment Canada to become compliant with NAFTA, which as of January 2009 required that Canada allow importation of Mexican vehicles that are ten years old or older. Right now it can't be done, believe it or not, so Canadians who go down to Mexico can't import them. What we're asking is to bring it to the committee. It should take no more than half an hour to an hour.

What I'm proposing is that we could bring it up on Thursday, tentatively based on whether or not you agree to it after you get your briefing. I would provide briefings in relation to it or ask the department to provide briefings to all the people interested. Once you get the deck on it you're going to see it's very small and very quick.

We could have this done and referred to the House before the break. What I'm proposing is that we keep Thursday open for this bill, and then we could have another bill to the House before Christmas. All of you would receive a briefing between now and then. I would get a deck to you, first of all, and you'll see it's quite small. Then if you want a briefing by the department, I would get that arranged before Thursday.

Ensuring Safe Vehicles Imported from Mexico for Canadians Act

[Yasmin Ratansi, Liberal, Don Valley East, ON]

Mr. Speaker, I am pleased to rise, on behalf of the Liberal Party, to speak to Bill S-5, An Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999. The short title of the bill is “Ensuring Safe Vehicles Imported from Mexico for Canadians Act”.

This was introduced in the Senate on April 14. The purpose of the bill is to amend the Motor Vehicle Safety Act and the Canadian Environment Protection Act to allow for the importation of used vehicles from Mexico, subject to certain conditions. These amendments are necessary to ensure that Canada is in compliance with its international trade obligations under NAFTA.

Everyone knows what NAFTA is. It is the free trade agreement that was signed between Canada, the United States and Mexico. Its objectives were to eliminate trade barriers and facilitate cross-border movement of goods. NAFTA, like all free trade agreements, establishes reciprocal rights and obligations for all parties to the agreement. Thus any trade benefit or rights that are granted in the agreement apply to all parties.

There has been some inconsistency or incongruity in the application of NAFTA where it concerns Mexico. There are some amendments to the Motor Vehicle Safety Act which would allow for used vehicles from the United States, previously sold at the retail value in the United States, that failed to meet the Canadian safety standards, to be imported into Canada on condition that the person importing the car would make a declaration that before the vehicle would be presented for registration, it would be made to conform with safety requirements. This is to allow importers of used vehicles from the United States the time to bring their vehicles up to the stringent Canadian safety standards.

The amendment to this section therefore would also extend to importation of used vehicles from Mexico that fail to meet Canadian safety standard requirements. These are important because there have been restrictions on vehicles from Mexico and not from the United States. As a partner of NAFTA, this will provide the mechanism to ensure vehicles that are sold in Canada meet Canadian safety requirements.

Bill S-5 would also amend the Canadian Environment Protection Act to allow for the importation of used vehicles from Mexico with certain conditions applied. The CEPA is necessary because any vehicle that comes into Canada has to meet our CEPA standards.

Simply put, Bill S-5 would bring Canada into compliance with its NAFTA obligation regarding the importation of used cars from Mexico. Although NAFTA was signed approximately two decades ago, several provisions were delayed. This is one of those provisions. When NAFTA was signed, Canada reserved the right to maintain all our restrictions on used vehicles until January 1, 2009. Since then, we have embarked on a 10 year process to phase out all of Canada's restrictions.

Currently, when used vehicles are imported into Canada from the United States, they do not have to meet our environmental and safety standards as they cross the border. However, as I mentioned, the owner must commit to ensuring that before he or she registers and licenses the vehicle, the necessary repairs and upgrades have been made so the vehicle is compliant. This is a really straightforward concept. We do not want cars that keep on emitting greenhouse gases because they have not been properly maintained. I listened to the debate and presentations on this.

We have problems in the third world, for example, with recycled and reconditioned cars. In Japan, for example, where after four years a car cannot be utilized and must be disposed of, those cars are reconditioned and sent off to third world countries. The cycle of cars going from one country to another without meeting proper environmental standards is problematic for us if we do not enforce the legislation.

The legislation would rectify an incongruity. The odd thing about that is that permission was not granted to vehicles imported from Mexico despite the fact that it is a NAFTA partner, so Bill S-5 attempts to rectify the incongruity.

The bill deals with two sets of regulations, the Canada vehicle safety regulation and Canada's environmental regulations, both of which are critical for the safe and clean operation of motor vehicles in Canada. Used vehicles imported into Canada from any location must meet both our safety and environmental regulations. I do not think anyone in the House would oppose this type of regulation. However, I would argue that it makes sense for us to allow the importers of these used vehicles to bring them into Canada for the upgrades necessary to bring them up to standard.

If our laws continue to prevent that work from being done in Canada, we would be punishing our auto mechanics. If used cars are at our borders, and we are not saying there are thousands of vehicles at the borders, and we allow the Mexican businesses to look after it, we would lose a lot of ground for our own auto mechanics. As part of NAFTA, we cannot give up that portion of the job creation that we would have. Plus, we have environmental standards that need to be met and our environmental standards are probably not the same as the ones in Mexico.

I believe it is an important aspect that those vehicles should come here for upgrades instead of allowing the advantage to go to some other country.

What I do not understand is why it took the government so long to introduce the measure because, as I mentioned, it was January 1, 2009 when we were supposed to implement the restrictions on used vehicles and it has taken until 2010 for the government to bring about these changes. The delay cannot be attributed to the opposition. Sometimes the government has a tendency to say that every delay on every bill is an opposition problem and because it was introduced late in the Senate, we need to move it quickly to ensure that it can go to committee for a better review.

What are the implications of the bill? The obvious implication of the bill is that the Canadian market may see more used cars from Mexico for sale domestically as a consequence of the increased liberalization of trade in used vehicles. The bill, however, proposes amendments to these two pieces of legislation in order to maintain a consistency in the level and safety standards of all vehicles being used in Canada regardless of whether they are used or whether they have been imported from the United States or Mexico.

If we look at what the stakeholders have said, the Imported Vehicle Owner's Association of Canada, which claims to represent hundreds of businesses and thousands of individuals who import vehicles into Canada, it indicated that it was in support of this amendment. The Canadian Vehicle Manufacturers Association has yet to present its views on this. If we are to ensure safety, consistency and congruence with NAFTA, I would like to see that the bill goes to committee.

It is important that Canada live up to its NAFTA commitments. There is no evidence to suggest there is a caravan of dirty, unsafe Mexican cars waiting at our borders. Bill S-5 would not weaken our environmental or safety laws but we need to send it to committee to ensure that a thorough analysis is done. We should let the committee do its job and listen to various witnesses.

[Jim Maloway, NDP, Elmwood—Transcona, MB]

Mr. Speaker, I am pleased to speak today to Bill S-5, a bill coming from the Senate.

Bill S-5 is an Act to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act, 1999. Its short title is “ensuring safe vehicles imported from Mexico for Canadians act. It was introduced in the Senate on April 14, 2010. The bill would amend sections of the Motor Vehicles Safety Act and the Canadian Environmental Protection Act, 1999, to bring Canada into compliance with its international trade obligations, mainly under NAFTA.

As members know, NAFTA is a multilateral free trade agreement between Canada, the United States and Mexico. Its objectives are to eliminate trade barriers and facilitate cross-border movement of goods and services between the territories of the parties. Furthermore, NAFTA aims to promote fair competition in the free trade area, increase investment opportunities in the territories of the parties and create effective procedures for the agreement's implementation, application, joint administration and for the resolution of disputes.

Several members have already pointed out that this agreement is now two years late. Under the provisions of NAFTA, this particular element of allowing Mexican used cars to be brought into Canada should have occurred back in 2009. As I had indicated, the NDP will be supporting the bill going to committee because we recognize that it simply puts into effect promises that we have already made as a country when we signed into the trade agreements.

However, that does not stop us from having some observations and thoughts about the implementation of what we are approving and what we are signing into now. That will come with the regulations and rules that the government puts into place, as well the consultations, in promulgating the rules and satisfying the concerns of our constituent parts in Canada, like the motor vehicle dealers associations and many other groups in this country.

We look at this situation now and say that it is unlikely that there will be many vehicles being dealt with here. One of the members said that we were trying to hold off a free trade challenge by the Mexicans. and that is part of the equation.

While we do not anticipate a lot of 10-year-old vehicles being imported into Canada under this agreement, the provisions are there to eliminate, on a year-by-year basis over the next nine years, the barriers for newer vehicles. Therefore, in another year from now we will be able to bring in nine-year-old used vehicles. Then it will be eight, then seven and, by 2019, we will be able to bring in all used vehicles. When that happens, that may prove to be a much bigger group of vehicles when we are talking about one, two or three-year-old vehicles. The residual value of those newer vehicles would be much higher than a 10-year-old vehicle would be.

When the cost of upgrading all the safety features that need to be done, the immobilizers in the case of Manitoba and the very expensive cost of transportation from Mexico for used cars is added on, importing a 10-year-old vehicle might not make a lot of sense. When we get to one or two-year-old vehicles, especially high-value vehicles, it may become economically viable for importers to start bringing in vehicles on a fairly large scale.

Whether that creates jobs in Canada or not is really beside the point, because as the members have pointed out, this is part of our trade obligations. It is simply one of the implementation procedures of our trade agreement.

NAFTA, like all free trade agreements, establishes reciprocal rights and obligations for all parties to the agreement. Thus, any trade benefits or rights that are granted in the agreement apply to all parties.

Chapter 3 of NAFTA establishes the rules with respect to according national treatment to all goods of another party to the agreement and the elimination of all tariff and non-tariff measures against goods of another party.

Annex 300-A of chapter 3 applies to trade and investment in the automotive sector. Annex 300-A states that each party shall accord most-favoured nation treatment to all parties of NAFTA with regard to trade and investment in the automotive sector. However, this general commitment is subject to a number of commitments that are country specific.

The country-specific provisions entered into by Canada include that of the U.S. agreement concerning automotive products between the Government of Canada and the Government of the United States of America that will now be incorporated into NAFTA.

Furthermore, Canada reserves the right to adopt or maintain prohibitions or restrictions on imports of used vehicles from Mexico until, once again that date, January 1, 2009, with a gradual phase-out of prohibitions ending in 2019.

There are prohibitions and requirements that jurisdictions put on concerning environmental issues and safety issues, but jurisdictions also have tight rules to protect their own markets, to protect their own dealers' associations.

In a way, this is breaking down some of those barriers that were artificially put there to support local industry or support local dealer organizations in the past.

This is something that business will have to deal with over time, because it is phased in. I guess one could argue that the NAFTA agreement has been around for many years, so it should not come as a surprise to anybody out there in the public or in the dealers' associations that this is in fact coming.

I can guarantee, and I am sure the members on the government bench will recognize this, that when all is said and done and this bill actually passes through the House, there will be a reaction from dealers' organizations that are going to say they never saw this coming, it was out of the blue, and that the problem was created by the government, when in fact it is part of the free trade process.

The phase-out is related to the age of the vehicles. Used vehicles that are at least 10 years old are the first to have restrictions lifted. Younger vehicles will follow, as I have indicated, over a period of 10 years.

NAFTA also clarifies that these restrictions on imports of used vehicles from Mexico into Canada are not inconsistent with Canada's obligations to provide most-favoured nation treatment to Mexico under our agreements.

The purpose of Bill S-5 is to amend the Motor Vehicle Safety Act and the Canadian Environmental Protection Act to allow for the importation of used vehicles from Mexico subject to certain conditions. The amendments are required in order to bring Canada into compliance, as I said, with the international trade obligations under NAFTA that we have with Mexico.

Clause 2 of the bill amends the definition of “vehicle” to include “any vehicle that belongs to a prescribed class of vehicles”.

The “prescribed class” of vehicle is defined in the motor vehicle safety regulations as:

a class of vehicle listed in Schedule III [of the regulations] or the class of incomplete vehicle prescribed under subsection 4(1.1) [of the regulations];

I presume that another set of regulations will be promulgated as a result of and after the committee process. Unless we are led to believe that the regulations are all before us now and are already included here, I am really uncertain about that.

Once we have an opportunity to take a look at those regulations, we will be able to see possible limitations, impediments and problems with the whole system.

Clause 3 would amend section 7. Section 5 of the act currently requires that all vehicles sold in Canada and all vehicles of a prescribed class that are imported into Canada must conform with certain safety standards as set out in the regulations of the act. Section 7 permits an exception for used vehicles that are imported from the United States. That is certainly an expanding market, and I will get into that later.

The registrar of imported vehicles is a newer situation involving imported vehicles from the United States. The whole regime has been streamlined over the last few years to make it much easier for imported vehicles coming from the United States and we are seeing increasing numbers of them.

It really depends a lot on the value of the dollar. When the Canadian dollar strengthens, we will see more activity with respect to the cross-border purchase of cars in the United States. Just last year when the Canadian dollar was higher than the U.S. dollar, there was a huge amount of cross-border activity. People were buying cars in the United States because of the value of our dollar.

The people buying these cars in the United States have to deal with the registrar of imported vehicles in order to bring them back. While the system is much better than it was a number of years ago, snags are still being reported with these purchases.

I have heard stories about people who buy vehicles and then have to fill out a tremendous amount of paperwork. The paperwork is relatively easy to get. It is all on the website of the registrar of imported vehicles. The information can simply be printed out. The vehicle essentially gets impounded at the border, so it is tied up for a couple of days. If a purchaser can follow the paperwork, then it is possible to purchase vehicles in the United States. However, that does not make our local dealerships very happy.

Ways have been found to work around the problem with warranties. For example, a company such as Honda will not honour the warranty for a vehicle purchased in the United States. Even though an individual can save money by buying a vehicle in the United States because of the value of the Canadian dollar and the vehicle can be brought into Canada, the individual is on his or her own with respect to the warranty. Toyota's rules were similar in the past, but in the last couple of years its rules have changed and now it will honour warranties on Toyota products purchased in the United States using the registrar of imported vehicles system.

The member for Brandon—Souris was a reputable used car dealer in his youth. He is listening very intently. He is one of the few Conservatives who I would buy a used car from. He is an old friend of mine from Manitoba and very knowledgeable about the automobile industry. He has a soft spot for this topic because it takes him back to his younger days when he was in private business and probably enjoyed life more than he does right now. At least he did not have all the travelling that is involved with being an MP.

The section currently provides that used vehicles, vehicles that have been previously sold at the retail level in the United States that failed to meet the Canadian safety standards, must nonetheless be imported into Canada on the condition that the importer makes a declaration that before the vehicle is presented for registration, it will be made to conform with safety requirements. This exception allows importers of used vehicles from the United States time to bring the vehicles up to levels required by the more stringent Canadian safety standards.

I have mentioned this before, but in spite of all these rules between Canada and the United States, we still had a situation in Manitoba only a year ago, exposed by the CBC on a national program. Under the United States' lemon law system, which is a state-by-state regime, car companies in the United States were forced to buy back lemon vehicles from the owners if they were unable to resolve the issue after four attempts.

I never thought about what actually happens to these vehicles that are bought back by the manufacturers. The CBC found out last year that the cars were being taken from, for example, the state of Florida, which, by the way, used to have the strongest lemon law in the United States, and they were being dumped in, say, Louisiana, which did not have a very good lemon law system. Then the importers, in this case a Manitoba dealership that the member for Brandon—Souris knows and I know as well, were actually importing these cars into Canada for an absolutely ridiculous price, perhaps $13,000 for a two- or three-year-old vehicle, and then were able to mark them up by double. This was serious enough that not only did it make the national news, but the Manitoba government actually introduced legislation to deal with that particular issue. That, of course, caused me to want to encourage it to go further and set up its own lemon law system, on which I have been working with Manitoba for many years, unsuccessfully I might add, to get through. However, that is another issue.

The fact of the matter is that we can all have the frameworks we want for trying to deal with the market with the very best of intentions at heart, but people who want to bend rules will always find a way to do it. So we have to try to collectively put our heads together and come up with the best regulations possible to at least minimize the effect on our consumers in terms of bad outcomes. Bad outcomes, of course, are in many ways related to replaced odometers or rolled back odometers, which we saw in Manitoba for many years coming out of Toronto, taxis being sold at auctions and the cars being sent out to Winnipeg and the odometers rolled back.

As a matter of fact, it was the Filmon Conservative government, which the member opposite from Brandon—Souris was part of, that actually dealt with the problem. We had a dealer who, for the second time in 25 years, was charged under the Weights and Measures Act with systematically rolling back odometers. He was buying cars at auctions in Toronto, putting them on a train, taking them to Manitoba, rolling back or replacing the odometers, and then selling those cars, which he was buying for $4,000, for $8,000. He got caught 25 years ago and was charged under the Weights and Measures Act, which really did not impose much of a fine, I guess, because it did not deter him. He kept doing it for another 25 years, until he was caught again. Then, under the Filmon government, they finally dealt with the problem by requiring people to have a history that would follow the ownership of the car.

It is similar to the system used in England, I believe, where every time the ownership of a car changes, the documentation follows it. There would be a record of the mileage and stuff like that, so if all of a sudden the odometer showed the mileage as half of what it was before, it would be inconsistent.

That was an excellent system they developed and it did solve part of the problem.

However, people with ill intent always find ways to circumvent the rules, and of course, this would be something that we would have to deal with.

Having said all of that, though, I agree. We will be supporting getting this bill to committee, and from there we will see where it takes us.