Evidence of meeting #10 for International Trade in the 43rd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was aluminum.
A video is available from Parliament.
Conservative
February 25th, 2020 / 5:15 p.m.
Manager, Components, Systems and Integration, Honey Bee Manufacturing Ltd.
Yes, we could absolutely do it through engineering standards. The European Union recently mandated that all phone chargers use USB-C instead of a whole slew of different proprietary charging ports.
In agriculture we already have the ISOBUS standard.
Manager, Components, Systems and Integration, Honey Bee Manufacturing Ltd.
It's used for equipment towed behind a tractor, and when you have a header on the front of a combine, you have additional requirements that the ISOBUS standard doesn't support.
There have been extensions, called TIMsthat have been asked for, but the OEMs are resisting that, and they're moving to the ability to close and own the value chain at the exclusion of all other third party participants on their platforms.
It's a commercial decision. We know that from the horse's mouth. We've debated it with them, and they're not accepting of changing course, so we're stuck in this. Shy of legislation, there is no recourse for implement manufacturers.
Conservative
Randy Hoback Conservative Prince Albert, SK
Then I guess what it comes down to again is regulation, to get it regulated across North America so that we have the ISO standards for you so you can operate that header in front, not just towed behind.
Do you see that being any easier with the USMCA, or is it going to make it harder to do things like that?
Manager, Components, Systems and Integration, Honey Bee Manufacturing Ltd.
I don't have an answer for that. I'm from the engineering department. My task is to make this Honey Bee header work on this combine, and we're running into hurdle after hurdle. What used to be a couple of wires in a hydraulic connection in a mechanical design.... They're going overboard on this, and they're not adding any additional functionality.
We've approached it in terms of the anti-competitive behaviour of that.
Manager, Components, Systems and Integration, Honey Bee Manufacturing Ltd.
We had a case with the Competition Bureau. It ran from last February until this February. It closed a week ago. They closed it because there was no enforceable legislation for the nature of our complaint.
Conservative
Randy Hoback Conservative Prince Albert, SK
Wow. It shows that the Competition Bureau doesn't have the teeth to deal with issues like this, whether they're in Canada or the U.S.
Manager, Components, Systems and Integration, Honey Bee Manufacturing Ltd.
We've worked with Global Affairs, ISED, Canadian Heritage, the Ministry of Agriculture. We've had the round-table discussions. It's a problem looking for a portfolio to live in. No one wants to take ownership of it. It needs to be solved or industry is dead.
Conservative
Randy Hoback Conservative Prince Albert, SK
Yes, so it's not just you guys who are going to be impacted by this. It's MacDon and a whole variety of people, right?
Manager, Components, Systems and Integration, Honey Bee Manufacturing Ltd.
Right.
General Manager, Honey Bee Manufacturing Ltd.
Yes, it's not just us, and I think that's one of the things. It's an opportunity for us, as a country, to be proactive in what we're doing. Technology is driving this, allowing for this to happen. I think we can get in front of it instead of behind it, because the cost of being behind is going to be a whole industry that's been developed over the last 70 years that will just disappear literally in months, if it gets implemented that strongly, and you'll see that right away.
Liberal
Sukh Dhaliwal Liberal Surrey—Newton, BC
Thank you, Madam Chair.
Thank you to the presenters.
I will carry on with Mr. Smith.
I am an engineer and I am having a difficult time grasping this. When you have machinery designed here in Canada and are supplying it to Japan, India or China, what impacts will this particular agreement have on the engineering perspective? I'm a little confused now.
Manager, Components, Systems and Integration, Honey Bee Manufacturing Ltd.
On the engineering side, we have to spend money to develop a parallel system that's a replication of what already exists on the platform we're trying to mount on, and we have a selection between our own design and the OEM controllers and systems.
As a specific example, we have to take direct control of the hydraulic pump on a tractor and relate it to the functions of our header to deliver a solution. It's a whole duplication of what already exists on the tractor because they haven't allowed open interoperability, and yet, the farmer wants that tractor and that header to perform the work that needs to be done.
The Copyright Act just allows us to do that legally if that exemption is put in place. In today's copyright law, it is illegal for us to go to any direct measure that's less expensive. If we develop into the software of the platform rather than doing a complete parallel system, it's less expensive, it's more plug and play and it uses the existing controls in the tractor, but it's illegal today.
Liberal
Sukh Dhaliwal Liberal Surrey—Newton, BC
Is this copyright coming under CUSMA, or was it in place before?
Manager, Components, Systems and Integration, Honey Bee Manufacturing Ltd.
I think that the concern is that, if we made a change after the signing of CUSMA, there would be the threat of sanctions and tariffs and so on if we then changed our Copyright Act to be in line with the U.S. copyright act. That comes from discussions with Loris Mirella and Global Affairs Canada where we discussed this at length to try to understand the problem. There are openings for side letters, but the retaliation on fines and tariffs could be something that's undesirable.
Liberal
Sukh Dhaliwal Liberal Surrey—Newton, BC
CUSMA does not prevent you from.... It's not CUSMA that's creating this problem. It is the copyright regulations that we have had for years, which we probably haven't updated. Is that the issue, or is CUSMA itself the issue? That is what I am trying to grasp.
Manager, Components, Systems and Integration, Honey Bee Manufacturing Ltd.
My understanding, again, is only what I've been told through discussions and negotiations with the different government ministries here. If we make changes to legislation that relates to advantages or disadvantages in trade in this way, there could be retaliation that is avoidable if the changes are made in front of the signature.
Liberal
Sukh Dhaliwal Liberal Surrey—Newton, BC
My next question goes to Northern Cables.
You say that CUSMA is going to impact the way you do business as well. Is that true?
President, Northern Cables Inc.
No. Our concerns are that under CUSMA there are things that could affect our trade. We've enjoyed, in our products, a fairly barrier-free trade for a number of years, and CUSMA won't affect that. We did have some very minimal effect in the tariff spat here two years ago.
Our issues are more that as we become an integrated economy, Canada will stand out as not being a fit partner. If we allow subsidized imports.... The U.S. has already identified harmful imports. We have testified at this committee about the effect of Chinese imports on the Canadian market, and now with CUSMA, there's the fact that those imports could be transshipped into the U.S. and cause international problems.
Liberal
Sukh Dhaliwal Liberal Surrey—Newton, BC
My understanding is that CUSMA will prevent that, because it will tighten up.... The Chinese market will not be able to dump that into the North American market.
