International Trade Committee on April 1st, 2015

[Chrystia Freeland, Liberal, Toronto Centre, ON]

Mr. Cartmill, do you have any comments on that?

[Charles Cartmill]

Yes.

I think if your regional development groups like ACOA could offer loan guarantees, it would be a tremendous help to SMEs.

[Chrystia Freeland, Liberal, Toronto Centre, ON]

Okay, thank you very much.

My next question is for the three witnesses.

Last Monday, we heard other witnesses say that there was a problem, since Canadians can have only one passport. That is a challenge for entrepreneurs who have to travel a lot for their work.

Would it help you to have two Canadian passports?

We heard from some of our witnesses on Monday that it's a real barrier to business to only be able to have one passport. They know that if people in other jurisdictions, for example in Britain, need to have two passports because of travel, they can get a second one.

Would that be useful?

[Martyne Malo]

Not for me. I've been travelling a lot and have only one passport. I didn't have any issue with that. I am wondering why I would need a second passport.

[Chrystia Freeland, Liberal, Toronto Centre, ON]

I think the comment from our witnesses was that they travel to countries where it takes a long time to get a visa. If one of your passports is in the embassy, you are blocked from travelling during that period.

I wonder if Mr. Williams and Mr. Cartmill encounter that.

[Charles Cartmill]

I know some of our staff at LED have experienced this problem. They've been couriering their passport, having to go on another trip, and waiting for it to come back. I could see that could be a help.

[Chrystia Freeland, Liberal, Toronto Centre, ON]

Mr. Williams, do you have any comment on that?

[John Williams]

You know it hasn't been a real issue for us at our company, but I could see how it could be if someone is on the road a lot, because it does take a bit of time to get your visas from certain countries.

The other issue with respect to passports is travel back and forth to and from the United States. When we have our employees going down there and making calls, sometimes there's concern about crossing the border and if there's any personal exposure or personal liability to them.

[The Chair, Conservative, Randy Hoback]

I have to stop you there. I'm sorry, but your time is up.

We'll move on to Mr. Shory, please.

[Devinder Shory, Conservative, Calgary Northeast, AB]

Thank you, Chair, and thanks to the witnesses as well.

Mr. Cartmill, I was looking at the brief that you presented to the senate committee. Towards the end you commented that governments need to be entrepreneurial in policy creation and support of companies for export growth.

Trade is at the forefront of our government's agenda, and lately it's been to make the SMEs aware of all of the services available to them—TCS, BDC, EDC, CCC—to support them to find and create new markets for exporting their goods and services to and to create good jobs here back home. Specifically when we talk about Go Global seminars, which is a major part of our awareness campaign, what more do you think the government should do to encourage and support the SMEs?

[Charles Cartmill]

I think what we have to keep in mind is that for companies to be strong in export markets, most of the time they have to be strong at home. I think some of the programs that the federal government has are fantastic, like the BCIP, which helps launch new technologies. The next phase of that program has not been implemented—I don't know if there is a second phase—but if you could take BCIPs, these leading-edge technologies that have been proven by the demonstration program with DPW, and make those standing offers so that other government departments across the country could have access to them at those prices, that would be phenomenal in building a solid base here in Canada. I think most SMEs have a lot of trouble dealing with groups like SDTC. You don't have the manpower to manage the kind of applications and time-consuming effort that's required for an SDTC.

There was another comment earlier about product development. NRC-IRAP is the best program for obtaining financial support for new product development, but I think they have limited funds. When it comes to SMEs it's a gruelling experience. I think it should be expanded.

[Devinder Shory, Conservative, Calgary Northeast, AB]

Thank you, Mr. Cartmill.

Mr. Williams, I have a quick question for you.

I see in the briefing material that Norco Bicycles have become popular throughout the world. When expanding into the international market for bicycles and related equipment, did your company make use of any of the Government of Canada programs like TCS and EDC? If yes, then can you comment on the quality of service you received?

[John Williams]

The government program that we use on a regular basis is EDC, and that's to insure our receivables. I think they do an excellent job.

[Devinder Shory, Conservative, Calgary Northeast, AB]

Good.

Have you faced any barriers to exporting your business, and are there any barriers on the Canadian side?

[John Williams]

From the Canadian government? No. There are no barriers. The only barrier, really, is the level of risk tolerance we're willing to accept to grow outside of Canada. We will hit a level where, if we can't get additional financing from either Canadian banks or banks outside of Canada, that will limit our growth, but to date we haven't hit that ceiling.

[Devinder Shory, Conservative, Calgary Northeast, AB]

Okay.

Ms. Malo, I have the same question for you. Do you face any barriers from the Canadian side?

[Martyne Malo]

Yes.

We ourselves do not export products; we export services. Our biggest obstacle is with Citizenship and Immigration Canada. Among the services we offer are linguistic services in more than 39 languages. For AAA projects, some clients will ask for language testers in their native language, and they cannot be found in Canada because we are sometimes dealing with second- and third-generation games. Because of the level of employment, people from Scandinavian countries do not come to Canada.

Since June, Citizenship and Immigration Canada has tightened its policy because some companies were abusing the department’s policies. Because of that policy, we have not been able to get temporary work permits for linguistic staff. We would have appreciated being informed before the policy was tightened. It would have allowed us to react by writing a letter explaining how the tightening of the policy was going to affect us.

From 1973 to 2013, a labour market impact assessment (LMIA) was free. After 2013, a fee of $215 was required. Since June 2014, that amount has been increased to $1,000, plus $155 for the permit and an amount of $346 for Quebec. If my need is for, say, 15% of my workforce to be foreign and if they must have a temporary work permit in order to work on the projects, it is going to cost me about $80,000 to get 52 employees, which is 15% of 350 employees.

[The Chair, Conservative, Randy Hoback]

Sorry. We're just running out of time for his question period.

We'll move now to Mr. Morin.

[Marc-André Morin, NDP, Laurentides—Labelle, QC]

Can you tell us briefly about your company’s experience with export promotion agencies? What has been your experience with all the government agencies that are supposed to help you export your services?

[Martyne Malo]

We have met with trade commissioners in Japan, France, the United Kingdom and Italy. They are accessible and their advice is good. They know the business culture in their respective territories well. They can advise us on the approach to take in each of those cultures, which could help us even more. We are already established in a number of places, with a number of clients, including potential ones.

It would be helpful if some of them could operate on the ground more. They could act as a link between us as Canadian suppliers and the needs of customers, or others, in a given territory.

They do not go that far. If we want to make contact with Nintendo representatives in Japan, they leave us to fend for ourselves. The credibility of Canada’s embassies and trade commissioners could make things more worthwhile, and quicker, for us, especially in Asia. One of the witnesses spoke about that earlier.

In China, it is a long process. In Japan too. Three years can go by before the capital you invest begins to pay off. Earning enough of their trust to be able to provide them with our services requires a lot of steps, a lot of meetings, a lot of contacts. Markets there are still closed. Staying in a place for three years hoping for some return really takes some doing. Certainly, the situation would become more interesting if we could take advantage of the embassies’ credibility and contacts.

Programs and grants should be treated differently, I feel. For the trade missions in the United States, Europe or Asia, bigger grants for export assistance should be considered. When we go to Japan, for example, there is no question of a quick in-and-out trip. We are there for at least two weeks. Trade missions take more time. The same goes for Europe.

For the trade missions that Canada organizes, it would also be a good idea to provide something a little more flexible for those who already have clients there, as we do. It would mean, for example, that we could stay a week longer and meet with our own clients, while still taking advantage of a hand with the arrangements.

[Marc-André Morin, NDP, Laurentides—Labelle, QC]

Do you think it would be useful to set up a one-stop shop where you could go for information that is more—

[Martyne Malo]

Are you referring to all the programs?

[Marc-André Morin, NDP, Laurentides—Labelle, QC]

Yes.

[Martyne Malo]

As an SME, we have few resources, but a lot of work to do. We can easily get lost in the multitude of programs being offered, both at the federal and provincial levels. We can't always spend days researching each of the programs to see how they complement each other and to identify those that would be most beneficial for us.

If there were a one-stop shop and we could call someone to ask about a very specific need, that might help us and save us time. For an SME, doing things fast is quite important.

[Marc-André Morin, NDP, Laurentides—Labelle, QC]

Quebec is probably very worried about keeping its own institutions. I don't think the communications between federal and provincial organizations are very smooth. It must be difficult for an SME to be in that situation.