Bill S-16 (Historical)

Tackling Contraband Tobacco Act

An Act to amend the Criminal Code (trafficking in contraband tobacco)

This enactment amends the Criminal Code to create a new offence of trafficking in contraband tobacco and to provide for minimum penalties of imprisonment for repeat offenders.

Second reading

[Candice Bergen, Conservative, Portage—Lisgar, MB]

Mr. Speaker, my colleague makes a very valid point. I know this from my own family experience. I actually lost a sister to lung cancer. She smoked for 35 years and she started as a young teenager. Sadly, the majority of people who are addicted to cigarettes today and want so badly to quit started as very young teenagers. They probably thought they would just try it our and never really continue, but as we know, it is an incredibly addictive substance.

The statistic that my colleague was referring to was a study that was done in Ontario and Quebec. In Ontario a full third and in Quebec 40% of all cigarette products used in high schools were contraband tobacco. Again, we are not talking about adults; we are talking about people in high school.

This is not just an issue of young people buying cheap cigarettes or, as I said, family members buying other family members cheap cigarettes when they go across the border or getting them within Canada. This is a much larger problem.

The other issue, which is something we are finding out more about, is that because these cigarettes are produced illegally, we do not even know what is in them. We already know just how poisonous and harmful basic cigarettes are when they are produced legally; illegally produced tobacco products are laced with all kinds of additional dangerous things that we have absolutely no way of controlling.

[David McGuinty, Liberal, Ottawa South, ON]

Mr. Speaker, I would like to follow up on the member's speech and pick up on a line of questioning I put to my colleague from Montreal earlier. This is an important bill because it would deal with a very serious problem. In my community, I have been lobbied, as I have said before, by retailers, the local RCMP detachment and community policing, but, from our perspective, it is important to remember that this has to be in concert with other activities.

I would like to ask the member if she could explain to the House a few things. How does the government contemplate messaging out to Canadians? We have seen very serious cuts in anti-smoking and smoking cessation campaigns and publicity in Canada since the arrival of the government. We have seen cuts in support for a number of community activities to engage our kids when it really counts, between the ages of 8 and 12, before they start to smoke or perhaps make even worse choices.

How does the government foresee going forward on dealing with a contraband issue, which is serious? How is it going to message out and increase the understanding and information in Canadian society so folks do not begin to smoke in the first place and do not participate in the purchase of contraband materials?

[Candice Bergen, Conservative, Portage—Lisgar, MB]

Mr. Speaker, although I appreciate the question, there are a number of facts that the member has wrong.

Let me begin with the basics. Our government has increased and sustained the transfers to the provinces. The provinces are primarily responsible for health care, as well as education. When we talk about young people being educated at the local level, we are the government that did not cut transfers to the provinces but increased them.

On another level, our government introduced new warning labels on packages of cigarettes and little cigars, which contain a quit line phone number and a website for people who want help to quit smoking. It was also our government that banned flavoured little cigars, which were clearly targeting young people.

Again, this is a multilevel approach and strategy that we have endeavoured to take. Our government has provided $20 million for the contraband tobacco strategy and increased funding to the provinces so they can do their work in terms of health care and education. Legislatively we are providing this bill, as well as other measures, to combat contraband tobacco, as well as a 50-member RCMP task force.

Today, we are talking about the issue of smoking, but this bill definitely targets contraband tobacco and organized crime activity. As much as I appreciate the member's questions, our federal government has taken the strongest leadership position in legislation, funding and real measures that help people know the dangers of smoking.

[Hoang Mai, NDP, Brossard—La Prairie, QC]

Mr. Speaker, I thank the parliamentary secretary for her speech. We agree that contraband tobacco is a scourge that must be addressed. The parliamentary secretary mentioned certain issues related to public safety and the health of young people.

I would like to raise the following point. The National Assembly of Quebec conducted a study and in its February 2012 report recommended that the Government of Quebec create a joint commission involving five parties, namely the governments of Quebec, Ontario, Canada and the United States as well as the Mohawk nation, to fight contraband tobacco. The report also called for an action plan that would deal with, among other things, a win-win agreement between the government and aboriginal governments to stop the large-scale tax-exempt sale of tobacco to non-aboriginal people. I would like to know whether the government is consulting with first nations, among others, and with aboriginal people, to tackle this problem.

[Candice Bergen, Conservative, Portage—Lisgar, MB]

Mr. Speaker, when we established the task force for combatting contraband tobacco, we engaged all sectors such as aboriginal communities, law enforcement and convenience store owners. I met with a number of them just the other day. On first nations reserves, contraband tobacco is a problem, the organized criminal activity aspect of it, as well as what I just mentioned, the health part with regard to addiction to cigarettes.

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I would like to begin by saying that I will be sharing my time with the hon. member for LaSalle—Émard.

Unfortunately, time is short. I will not make use of the privilege of making a 20-minute speech. That way, any of my colleagues who so desire will have the opportunity to talk about this bill by expressing their concerns about or their support for the positive aspects of Bill S-16.

The use of time allocation motions has been a real tragedy in our democracy during the 41st Parliament. This bill addresses a very important issue that affects society in many ways. It is a public health, tax collection and major crime issue. It is truly appalling that the government is so foolishly restricting our attempts to put forward constructive proposals in order to stimulate debate and potentially improve this bill, if needed.

This debate is all the more necessary because Bill S-16 is designed to amend sections of the Criminal Code, which is not a bad thing in and of itself. Quite the opposite, actually.

This bill comes to us from the Senate, not from the Minister of Justice, which would have been logical and certainly preferable. The government's approach is very questionable and does not help us in our work. It raises questions about the government's motivation and about what it is hoping to achieve by introducing this bill.

I am not denying that it is good to be able to use this bill to discuss this issue. However, is Bill S-16 the best way to fight contraband tobacco? Unfortunately, this bill raises more questions than it answers.

Just a few weeks ago, we celebrated the two-year anniversary of my short career here in the House. During my time here, I have had the privilege of being the critic for small business and tourism, for one.

There is no denying that contraband tobacco, in addition to being a criminal activity and a real threat to our society, is a very serious problem that threatens the profitability of many small businesses.

Often, these businesses are owned by just one person who has a similar status to an employee. These business owners, who may have one to three employees, are just trying to earn an honest living.

These small business owners shoulder almost all of the responsibility for the business and they often do not make very much money, particularly in the first few years after they start or acquire the business. Absolutely anything that reduces their profit margin poses a very serious threat to their business. It can make the difference between earning an honest living or the business failing or going bankrupt. We hope that many of those businesses avoid bankruptcy, but there are motivated entrepreneurs who are prepared to enter the business world whose businesses fail and disappear. That is just how it works.

All small convenience-store-type businesses make a lot of money from tobacco sales. They can make a bigger profit from tobacco than they can from many other products. A significant drop in the sale of tobacco products seriously cuts into the profits of these types of businesses.

I think that we can quite easily reach a consensus with the government on this issue. In fact, we are in favour of any measures that support small businesses, as long as the government gives us the opportunity to present our arguments and suggest improvements that will allow us to address the challenges associated with the fight against contraband tobacco.

I would like to focus on a very questionable aspect of this bill. I had the great privilege of being a member of the Standing Committee on Justice and Human Rights for a time and helping the committee examine bills, particularly private members' bills that amended provisions of the Criminal Code. Unfortunately, these private members' bills too often failed to meet their objectives. As part of the study of these bills, we often heard witnesses strongly declare that the proposed measures, despite their good intentions, would not help the situation and could even make it worse.

The aspect of the bill that I seriously question is the mandatory minimum sentencing for various types of offences. I hope that this will be examined in more detail by the Standing Committee on Justice and Human Rights.

I would like to talk about the testimony of former Supreme Court justice John C. Major, who appeared before the committee. As a very experienced and learned legal expert and a former member of the Supreme Court, Justice Major was in a position to correctly assess the pertinence, usefulness and effects of mandatory minimum sentences. I do not wish to repeat everything he said, but he did conclude that there was no conclusive evidence that mandatory minimum sentences are a deterrent and of any real use.

In fact, Justice Major, and other witnesses as well, said that, in the complex and subtle mechanism of court proceedings, the fact that there are mandatory minimum sentences could even be an incentive for the parties in question. In fact, the prosecutors and the defence attorneys could come to an agreement to avoid this type of measure with the judge's agreement, simply because it would not allow for any room to manoeuvre in a criminal case.

It does go quite far. In the end, it would be detrimental to the work done in the justice system to enforce the Criminal Code. This will become apparent in the coming years, if we are not already seeing it in certain cases. This very serious consequence deserves to be studied in depth. In my opinion, it is the most debatable aspect of this bill.

I urge government members to seriously consider, question, or at least take the time to assess the adverse effects of mandatory minimum sentences. If we should continue down this road, we will at least understand how this can usefully be applied to fighting crime related to the illegal trafficking of tobacco.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr. Speaker, I thank my colleague for his speech. He touched on some very interesting points that are important to me as well.

He spoke about mandatory minimum sentences and the impact they have, and he also spoke about the impact that contraband tobacco has on small and medium-sized businesses. We are actually talking about small and very small businesses. I am sure he has those in his riding.

Could he speak more about those two points he raised in his speech?

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I thank my colleague from LaSalle—Émard for her question.

Starting up a business is always a challenge. However, competition is very tough for small businesses in this type of traditional sector. There are also a large number of factors that can cut into profitability. My colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup can attest to that. He is currently working on the issue of fees associated with credit card reward programs.

The huge fees prevent these small businesses from predicting costs and profits. Their sales figures can be undermined by lower revenues from the sale of tobacco products, which still has a good profit margin. There are two very different types of risks here, which makes things extremely complicated for small business owners.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Mr. Speaker, the government boasts about wanting to combat organized crime involved in contraband cigarettes. It may want to pass a law to punish people who are caught smuggling cigarettes, but in general, the leaders of organized crime groups do not get their hands dirty. We would have liked to know what this government, which boasts about being tough on crime, will do about the Mafia leaders who are currently praying in church for this government to be re-elected, since the government is making their lives so much easier by making cuts to the budgets of the Royal Canadian Mounted Police and Canada's correctional services.

I would like to know how this bill will protect us from these major criminals, the people who lead organized crime groups. What would be appropriate measures and budgets to go after these people who have created a state within a state?

[Raymond Côté, NDP, Beauport—Limoilou, QC]

Mr. Speaker, I thank my colleague from Marc-Aurèle-Fortin for his heartfelt speech, which echoes the words of our colleague from Compton—Stanstead. This member spoke about the border services' lack of resources to combat contraband tobacco.

To answer my colleague, quite frankly, I really do not see how this bill would enable us to touch those famous Mafia bosses.

The other thing that bothers me is that the government is vastly undermining our capabilities. For example, I spend a lot of time on the road travelling to the Hill. The trip takes me 4 hours and 30 minutes. The best way to combat speeding on our roads is not to enact tougher laws, but rather to station patrol cars on the side of the road. This is when everyone starts hitting the brakes.

In short, it is obvious that the problems are not primarily related to legislation. Legislation can result in significant progress in regard to the bosses and large-scale organized crime. However, the much bigger problem lies with the resources allocated to carry out investigations in order to enforce the law as it is.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr. Speaker, cigarettes are a scourge. There is no doubt about that. They are a health hazard and lead to serious addiction.

Over the years, measures have been taken to control tobacco as much as possible and to dissuade people from taking up smoking. As some of my colleagues mentioned, very young people will start smoking despite all of the warnings, and they will often be far more affected by their dependence on cigarettes.

The NDP also recognizes that contraband cigarettes—the illegal sale of cigarettes—is also a scourge because they are often sold for less and can encourage new smokers and young smokers. Contraband cigarettes help perpetuate the negative impact of smoking.

I have the honour and privilege of representing the riding of LaSalle—Émard, which is on the Island of Montreal, in Quebec. There are a large number of convenience store owners in my riding. I had the opportunity to meet with the convenience store association, whose members are feeling the economic impact of contraband cigarettes. That is what is so paradoxical about this product, which is such a health hazard. The government is making money off it and trying to control it at the same time. Convenience store owners are feeling the economic impact of contraband cigarettes. Quebec and Ontario are often affected.

Documents provided by the Library of Parliament indicate that, under current laws, namely the Excise Act, 2001 and the Criminal Code, cigarette seizures by the RCMP have been increasing over time. There has been a tremendous increase. The number of seizures was quite low between 2001 and 2004, and then it suddenly skyrocketed.

The legislative summary suggests that law enforcement priorities may have played a role as well. Trafficking in contraband cigarettes has increased significantly and not just Canadian cigarettes, but imported cigarettes as well. Under the current regime, the RCMP can already make major seizures. We can see that in the statistics in the chart, which is very clear and quite graphic. Dealing with this scourge was a priority.

We must debate Bill S-16, An Act to amend the Criminal Code (trafficking in contraband tobacco), which is also called the Tackling Contraband Tobacco Act. This bill originated in the Senate and seeks to create a special provision on contraband tobacco. Again, I am not denying the fact that this is a scourge and that we must deal with it here in the House. However, I want to talk about the laws currently in effect to deal with this problem. Under the current legislative regime, RCMP seizures have gone up.

We saw that tackling contraband cigarettes may have been made a priority. That is why I am puzzled. I am not saying that I do not support Bill S-16, but I am wondering about the measures already in place that seem to be doing the job.

As I mentioned, the Excise Act, 2001, is in effect and we also have the Criminal Code.

Charges under the Criminal Code may include, but are not limited to: fraud, conspiracy, conspiracy to commit offences, participation in activities of criminal organization, and possession of property obtained by crime.

Under the Excise Act, 2001, the offences are:

...selling, offering for sale, purchasing or possessing unpackaged or non-stamped raw leaf tobacco (section 30) and the possession, sale or offering for sale of tobacco products that are not stamped (section 32), both of which are “hybrid offences”.

The Excise Act, 2001, already provides specifics that truly tackle the illegal sale of tobacco.

We are still talking about the enforcement and impact of Bill S-16. The legislative summary goes on to say:

Criminal enforcement under the Excise Act, 2001 may be carried out by “any police force in Canada” that is designated according to certain conditions. It appears that the RCMP is the force designated as such. In comparison, all police forces may enforce Criminal Code provisions.

This covers quite a bit in terms of the enforcement and impact of existing legislation.

The parliamentary secretary also talked about something mentioned in the legislative summary:

The Standing Senate Committee on Legal and Constitutional Affairs submitted observations with its report on the bill, suggesting that the government consider providing provincial police with enforcement powers under the Excise Act, 2001, as well as under the Customs Act.

Once again, this is about problems related to enforcing the law.

I would like to share an interesting example. It is important to understand that a number of stakeholders are involved in enforcing this law. However, a number of stakeholders also find themselves on the other side of the law, that is, breaking the law.

Coming back to the legislative summary, it states:

For example, in the Cornwall area, there are various efforts such as joint investigative units and a task force to encourage collaboration between various enforcement organizations such as the RCMP, the Canada Border Services Agency, the Ontario Provincial Police, the Cornwall Community Police Service and the Akwesasne Mohawk Police Service.

In my opinion, that is a good example of co-operation between all stakeholders in order to enforce various laws that fight contraband.

In conclusion, I would like to point out that the NDP takes the problem of tobacco contraband in Canada seriously. I mentioned this in my introduction and I am saying it again now.

Tobacco contraband is a problem that affects health and public safety, tax revenues and the profitability of small businesses, as I already pointed out. For that reason, the NDP has asked the federal government to take action on this issue and to co-operate with the communities affected the most. That is very important.

The government must provide the necessary resources to the Canada Border Services Agency and the RCMP in order to properly deal with the problem because it is also an international issue.

Unfortunately, as we saw in the most recent budget, the government did not. The cuts will hinder the fight against counterfeiting and contraband.

[Kennedy Stewart, NDP, Burnaby—Douglas, BC]

Mr. Speaker, I listened with great interest to my colleague's speech. I would really like to thank her for the wonderful work she does leading us in industry committee and as our NDP industry critic.

We on the west coast have some real concerns about counterfeiting, mainly because the port of Vancouver is the top entryway for contraband cigarettes in Canada and we have just eliminated the Coast Guard station there. Now we have no Coast Guard presence at all monitoring these ships that are coming in.

We are supporting sending the bill to committee to look at this issue. I would like to ask my colleague how, in light of these facts, we might expand our investigation here to include issues like Coast Guard presence on the west coast.

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr. Speaker, I thank my colleague, who does an excellent job as our science and technology critic. He raised a very important point about good intentions. Having good intentions is commendable.

However, we have questions about how the bill will be enforced. My colleague raised the point that contraband cigarettes are no longer a local issue, but that they have become national and international issues. How can we successfully tackle contraband?

I want to point out that it will be the same thing with Bill C-56, which deals with counterfeit goods, if we do not come up with measures to back up our plans.

[Christine Moore, NDP, Abitibi—Témiscamingue, QC]

Mr. Speaker, I thank my hon. colleague for her speech. She began by calling tobacco use a real scourge. I have been a smoker for a very long time, many years in fact, and I regret ever starting. Right now, I have not had a cigarette in 10 days, and I hope to successfully quit.

I studied the bill and did not see any measures to address the issue of demand. When we talk about contraband, it is a question of supply and demand. If people continue to demand these products, others will produce them.

I would like to know if my colleague thinks the bill includes any specific measures to stop people from smoking or at least to ensure that there is no demand for contraband products. Does the bill contain any measures of a more social nature related to health, or is it a strictly justice-related or technical bill?

[Hélène LeBlanc, NDP, LaSalle—Émard, QC]

Mr. Speaker, I thank my hon. colleague for the question.

She raised the issue of prevention. I agree that one of the problems is indeed supply and demand. She also mentioned the health aspect. As another member mentioned earlier, the federal government cut funding for anti-smoking programs.

This bill is more about simply amending the Criminal Code. However, we need to take a holistic approach in order to determine who is involved in this market on both ends—both the buying and selling. That is a very good point, and it also relates to our economy.