Industry Committee on Nov. 25th, 2013

[Ed Holder, Conservative, London West, ON]

I have a point of order.

[The Chair, Conservative, David Sweet]

Yes, Mr. Holder.

[Ed Holder, Conservative, London West, ON]

Thank you.

Maybe it's a point of clarification. Maybe you could guide this humble servant of the committee. With regard to our witnesses who have made some effort to be here, it's unfortunate this procedure happened the way it did.

My practical question is whether or not we are likely to come out of camera at some point and then be able to hear additional testimony from these nice people.

[The Chair, Conservative, David Sweet]

Because of technology, we'll have to reconnect with Ms. Nott. The previous connection will have to be terminated because of the committee going in camera. We'll ask Mr. Spreekmeester if he would stay around for at least a short time to see if we'll be returning to the subject at hand. That's how we will proceed for the moment.

I'll need everybody whose neither a member of Parliament nor staff of a member of Parliament to leave the room.

Ms. Nott, we'll have to disconnect and reconnect, should we be coming back to the subject at hand.

Thank you everybody for your patience. We're suspending.

[Proceedings continue in camera]

[ Public proceedings resume]

[The Chair, Conservative, David Sweet]

Ms. Nott, can you hear me?

[Joy Nott]

Yes, I can hear you.

Can you hear me?

[The Chair, Conservative, David Sweet]

We can hear you loud and clear.

I think your question was for Ms. Nott, Mr. Bélanger. You'll need to do it fast. You have a minute and two seconds.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Very quickly, I was wondering if you could tell us what the differences are in administering the law between the U.S. customs and Canadian customs, which you seem to be saying is better dealt with in the U.S., and which we could be copying in Canada and making sure that the details are satisfactory to you. You may want to send some of that to the committee for it to be shared with committee members if you have a lengthy response.

[Joy Nott]

In very short order, the difference between Canada and the United States right now is simply that the United States does have a process at the border to question, stop, and scrutinize any kind of trademarked product, whereas in Canada, as long as the goods are described appropriately, as I said earlier in my example of the Canada Goose jackets, as long as the documentation that accompanies the shipment declares them as winter jackets, there's nothing in Canada that can be done currently. In the United States the minute anything is trademarked, a shipment needs to declare, on the documentation, without even opening a box, that it is trademarked goods, and that they have the permission of the trademark owner to import those goods. That's a documentary process.

The one thing, as I said earlier, is that in the United States they have a well-known—it's been in place for a very long time—but very document-heavy process. While I think we should be copying it in spirit, I would hesitate on copying the paper-heavy process. I think we should be looking in Canada at developing some sort of an electronic way, because the paper process, of course, always has a risk of slowing down the supply chain.

[The Chair, Conservative, David Sweet]

Thank you very much, Ms. Nott.

I'm going to go on to Mr. Warawa right now. We'll just deal with four questioners of five minutes each, and then we'll need to get back into committee business. I did want our members to know that Mr. Spreekmeester needed to catch a plane back to Toronto. I just got a note to that effect.

Mr. Warawa, go ahead.

[Mark Warawa, Conservative, Langley, BC]

Thank you, Chair.

Ms. Nott, thank you for being here.

We heard a number of witnesses at our last meeting suggest we look at the European model. One of the previous questions to you was whether there was any other jurisdiction doing a good job. In the European model, where items are detained as suspected counterfeit goods, it isn't the rights holder that is paying, it's the importer. What is being suggested is that if items are being held, then they can be held for up for 10 days to determine whether or not they are counterfeit. If there are concerns that they are counterfeit, it's the rights holder that would be paying the costs, which could be quite extensive. Do you have any input on that?

I've just lost my other question, so I'll have to ask it later, sorry.

[The Chair, Conservative, David Sweet]

We'll come back to you.

[Joy Nott]

Maybe it will come to you as I answer.

In answer to your question, I think that should suspected counterfeit goods be apprehended at the border, I absolutely think that it should be the importer trying to import them into the jurisdiction that must incur any costs and any penalties. For the rights holder of the actual trademark, if it's a legitimate shipment, then, fine, through whatever process of vetting, that should easily be discernible to the customs authorities that it is a legitimate shipment, and then they let it go. If indeed it's proven to be counterfeit or it's suspected to be counterfeit and the importer cannot prove otherwise, any costs, any penalties, should be borne by the importer and not the trademark rights holder because otherwise it doesn't balance the scale.

[Mark Warawa, Conservative, Langley, BC]

The other question had to do with in-transit inspections and detention. One group, or half of the witnesses, suggested that we inspect items that are going through Canada to the U.S. market because the U.S. market is inspecting items coming into the Canadian market. Do you have any comment on that?

[Joy Nott]

The only comment I have on that is, as I'm sure you know, Canada is currently negotiating with the United States a Beyond the Border strategy that was announced by Prime Minister Harper and President Obama. As part of that overall agreement, there is a pilot project right now in Prince Rupert, and then there's another one between Montreal and the United States, using the concept of inspecting once, accepting twice. For example, if a steamship line chose the Port of Prince Rupert to dock and the containers that were offloaded at Prince Rupert were ultimately destined for the United States—just transiting through Canada because they had to in order to get to the United States—then under the Beyond the Border agreement, whichever party, Canada or the United States, who physically received the goods first would be the party to do the searching and checking. Thus, when it actually got to the frontier points of the United States and crossed legally and technically onto U.S. soil, there would be no need for a customs officer to re-check it because it would have been checked at the first point of entry into North America. North America is defined as Canada and the United States.

I don't know if you are familiar with that aspect. I know it's minutia, but it's part of the Beyond the Border deal. It's currently being piloted between Canada's CBSA and the U.S. CBP.

I don't know if that directly answers your question.

[Mark Warawa, Conservative, Langley, BC]

It does.

[Joy Nott]

It would work in reverse as well.

[Mark Warawa, Conservative, Langley, BC]

Thank you very much. I'm done.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Warawa.

Now we go on to Ms. Charlton.

[Chris Charlton, NDP, Hamilton Mountain, ON]

Thank you very much, Chair.

Thank you very much, Ms. Nott. I apologize about the way this afternoon has gone for you. We sure would have liked to spend more time with you.

I just have one very quick question for you. You said that the devil is in the details and that enforcement is a concern for you, and I certainly understand that because you're probably keenly aware about the cutbacks to CBSA and, without enforcement, Bill C-8 doesn't mean very much. Because of those uncertainties, would you like to see some kind of a periodic review of how the legislation or the implementation of the legislation is working so that we have some metrics and perhaps, after whatever period of time, we might be able to review where we could improve the legislation, and would you be comfortable with those reports going to Parliament so that they would be publicly accessible?

[Joy Nott]

I would have no objection to that. Just from past experience, not specifically on this piece of legislation, but traditionally, it's not the legislation that causes an issue; it's sometimes the regulations and wording within regulations that support the legislation.

Then the next scenario would be it's not the legislation, it's not the regulations, but it's the way they're being interpreted by government bureaucrats such as CBSA officers and that sort of thing.

Do I support the monitoring of this sort of thing? Absolutely I do. I think that's a great idea because, from a business perspective, business lives on metrics and on data. This is how they help to make decisions. Right now when it comes to copyright infringement, trademark infringement, and the ability to import into Canada, it's a little bit like the wild west in that there's nothing that stops these shipments at the border currently unless the owner of the trademark takes specific, very onerous action through Canadian federal courts to register something.

[Chris Charlton, NDP, Hamilton Mountain, ON]

Thank you very much, Ms. Nott. I'm sorry, I don't mean to cut you off, but I do have to get to one other item. As you probably noticed before you were so rudely interrupted, we had a bit of an issue here about whether and when our committee should move in camera.

I had the privilege of moving a motion on behalf of our caucus a while ago that I want us to return to at this point. It was:

That the Committee may meet in camera only for the purpose of discussing: (a) wages, salaries and other employee benefits; (b) contracts and contract negotiations; (c) labour relations and personnel matters; (d) a draft agenda or draft report; (e) briefings concerning national security; and that all votes taken in camera be recorded in the Minutes of Proceedings, including how each member voted when recorded votes are requested.

I think it's really important that we deal with that issue today. It's what got us into the mess this afternoon. I think we should clarify the rules under which we move in camera, especially in committees like this where we're being rude to witnesses—

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

I just want to be clear. Is Ms. Charlton moving this motion right now? Are we actually right now on this motion? I see her nodding. This is bizarre. In effect she's ending the committee meeting again after we just had Mauril end it already and put a pause to it.

I think this has to change. We just can't consistently have these games being played by the opposition members.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Lake.

Is this on the same point of order?

[Ed Holder, Conservative, London West, ON]

I thought Mr. Lake had said that we move in camera.