International Trade Committee on Dec. 10th, 2013

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Thank you, Chair.

Thank you to the witnesses for coming forward.

My time is a bit limited, so I'll try to ask quicker questions.

Mr. Williams, I understand the competition with the generics, but exclusive of generics, most of the companies you represent are worldwide companies.

Is that correct?

[Russell Williams]

We're global, absolutely.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

How would the CETA benefit your companies if they're already around the world? You're competing against yourselves.

Are there any other innovative companies that are not in Canada, or some of your companies that are not in markets in Europe? What is the benefit?

[Russell Williams]

The benefit is for Canada. The benefit is that we will do the research here in Canada versus somewhere else.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

We're already seeing the research going out of the country. Now your companies will benefit because of the fact that there is a free trade agreement and the research will maybe be in countries with lower cost.

That's what I'm hearing from some of the other people who have come forward.

[Russell Williams]

There are a number of factors when you determine where you're going to do the research. One of them is the IP regime, and Canada was behind in that. It's moving forward to correct that, so there is more likelihood—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Sorry to interrupt, but there are countries in Europe that can say the same thing.

Help me to reconcile how your companies are going to be able to pick Canada over 34 or 35 countries in Europe.

[Russell Williams]

The European IP regime was better than Canada's, and still is.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

It still is?

[Russell Williams]

It still is, but we've moved forward on it. We moved forward with the CETA agreement.

For instance, Europe has 10 years of data protection, we stayed at eight. We'll be able to attract more investment with—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Unless we go to 12 we're not going to be able to—

[Russell Williams]

There are a number of factors. It's science and it's other factors—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

I'm just trying to put the facts on the table because you said that Canada will be more competitive and that drug prices will not increase, but I'm looking at the free trade agreement. The reason we're going to sign a free trade agreement is that prices are going to decrease, we're going to create jobs, and we're going to have investments. Those are the kinds of things that I want to hear.

[Russell Williams]

That's what I said.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

I want to make sure that we're going to benefit from this agreement. Those are things I want to hear because we're signing an agreement with another entity on the other side and I want to make sure they don't benefit more than we do.

[Russell Williams]

Personally, if we had 12 years of data protection, I think that would be wonderful for this country. But right at this point, we didn't do that. We did move on patent term restoration and we are correcting the right of appeal.

In terms of your other question, there are other companies. For instance there are five Japanese companies in our association. They are thinking about where they are going to invest. We're talking with Japan and Canada in the free trade discussions there, but it isn't about the countries, it's about the environment in Canada where we'll decide to do research.

But if you're sensing a bit of nuance to my statement, no, we didn't go to the top of the class, but we made significant improvements in leveling the playing field and that will help Canada.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Okay. That's good. Thank you.

Mr. Westcott, in the spirits industry, what does Canada produce most? There are obviously the whiskeys you referred to, but what are the second and third products that the European market would be interested in? Do we manufacture rums and vodkas?

[Jan Westcott]

We produce pretty much everything. We produce vodka, gin, liqueurs, you name it. Predominantly our exports are whiskey, but we do export some vodka to Europe. We have a very strong liqueurs business so we also export some of those products. They are unique brands, unique flavour profiles, which we've had some success in penetrating Europe with.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

So if the tariffs in Europe are removed we'll be able to export more? You already said that this year exports have grown by 20%. What is that due to?

[Jan Westcott]

In large part that's driven by a renewed consumer interest, pretty much worldwide, in brown spirits, predominantly whiskey, but not exclusively. We're seeing a huge—

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

Sorry to interrupt you, but my time is limited. They cut my time so I've got to run on this thing.

So if the tariffs come down are we going to be able to sell more whiskey and sell more products?

[C.J. Helie, Executive Vice-President, Spirits Canada]

Just for clarification, the EU did not have tariffs on Canadian spirits going into the EU. We've been building, since the 2004 wine and spirits agreement, in all the other non-tariff barriers. That's how we've increased 20% and we see CETA as another push to double that again.

[Massimo Pacetti, Liberal, Saint-Léonard—Saint-Michel, QC]

My last question is on the investment. Is your industry going to have to make more investments?

[The Chair, Conservative, Rob Merrifield]

Sorry, your last question has already been done.

Mr. Holder, the floor is yours.

[Ed Holder, Conservative, London West, ON]

Thank you, Chair.

I'd like to thank our guests for being here this morning to share their comments and their testimony.

It's an interesting panel, Chair, that you've put together, drugs and alcohol....