International Trade Committee on April 23rd, 2026

[The Chair (Hon. Judy A. Sgro (Humber River—Black Creek, Lib.)), Liberal, Judy Sgro]

I'm calling the meeting to order.

Welcome to meeting number 33 of the Standing Committee on International Trade.

Pursuant to Standing Order 108(2) and the motion adopted by the committee on Thursday, February 12, the committee is resuming a study of free trade within Canada.

We have with us today Mark Mancini, professor in the faculty of law at Thompson Rivers University; from the Canadian Chamber of Commerce, Pascal Chan, vice-president, strategic policy and supply chains; and by video conference, for Maple Leaf Foods, Michael McCain.

Welcome to all of you. Thank you for being with us today. This is an important study that we're doing, and we very much appreciate your comments.

We will start with opening remarks of up to five minutes, please.

Mr. Mancini, I will start with you.

[Mark Mancini, Professor, Faculty of Law, Thompson Rivers University, As an Individual]

Thank you, Chair and members of the committee, for having me here.

As you heard, my name is Mark Mancini. I'm a professor of law at Thompson Rivers University in Kamloops, British Columbia.

I'd like to speak to you today about primarily three things. Number one is about constitutional barriers that potentially exist to establishing frictionless free trade across Canada. Number two is existing problems with some of the tools that governments have reached for in light of those barriers. Number three is what the Constitution might permit us to do instead.

I make these comments today based on a report that I co-authored with my colleague, Professor Paul Daly, for the Macdonald-Laurier Institute. Professor Daly will be here to speak to you in the next hour.

Let me start with the constitutional landscape and why it presents somewhat of a problem for frictionless free trade in Canada. The Constitution—wisely, actually—divides economic authority between Parliament and the provinces. Provinces hold broad jurisdiction over property and civil rights in the province, professional regulation and trade.

The result in a federation like ours is an inescapable web of non-tariff barriers: different product standards, different licensing regimes and different certification requirements for important professional jobs. Even well-intentioned regulation of this kind, by its nature, creates constitutional friction. Despite the fact that this is inevitable, these approaches can be duplicative and wasteful.

Parliament's jurisdiction over trade and commerce is broad, but it can't override this constitutional reality. The Supreme Court of Canada has been clear: Federal legislation cannot descend into the day-to-day regulation of goods and professions reserved to the provinces. Also, the court unfortunately has narrowed other interpretive pathways to a frictionless national market, most notably in the “free the beer” decision.

This background explains why existing recent statutory efforts to encourage regulatory harmonization, while positive, are not complete. The Canadian Free Trade Agreement, for example, despite recent positive efforts on that front, is voluntary and, for its benefits, still contains lists of exceptions on goods and labour mobility.

The One Canadian Economy Act, recently adopted, represents a major step forward, but of course it can apply only when federal and provincial laws naturally interface. It cannot compel cross-province acceptance of regulations among the provinces.

Moreover, many of these efforts, including those in the provinces, rely on a constitutionally suspect method of breaking regulatory impasses. They depend on so-called Henry VIII clauses, named after that old Tudor king, which permit individual cabinet ministers or the cabinet as a whole to amend primary law. The executive, under this mechanism, purports to exercise a quintessentially legislative act, blurring the lines of accountability. While the Supreme Court has held that these mechanisms are constitutional, they exact a cost in politics, because they distort accountability and they depend on executive action changeable at the stroke of a pen, creating an unstable policy environment for regulated entities.

That brings me to what we do going forward, and that's the subject of our report. There is a constitutionally sound escape valve from all this. The solution we propose in our paper is a joint federal-provincial agency created through matching legislation passed at both levels of government.

This agency would do three things. It would mandate mutual recognition. If a good, service or professional credential is lawful in one province, it would be lawful in all. Second, it would develop national harmonized standards and a means to enforce them through the agency. Third, and maybe most importantly, it would systematically identify barriers and recommend their removal, with provincial ministers acting on those recommendations through tightly constrained and accountable executive powers.

This is not technocracy or bureaucracy for the sake of it. This proposal is designed to coordinate and reduce the duplication of national and provincial regulations. We take the world as it is. We live in a highly regulated economy, and we want to leave space for jurisdictions that choose to simply remove regulations outright, while continuing to coordinate regulatory responses at the national and provincial levels.

With this in mind, our Constitution need not be a counsel of despair. Parliament and the provinces can build a regulatory solution that works within the division of powers and does not depend on inherently unstable executive action. The law here, in other words, is not an obstacle. It can be a solution.

Thank you for your time today. I welcome your questions.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Mancini.

Mr. Chan, please go ahead with a statement of up to five minutes.

[Pascal Chan, Vice President, Strategic Policy and Supply Chains, Canadian Chamber of Commerce]

Thank you, Madam Chair.

I'm Pascal Chan, vice-president of strategic policy and supply chains at the Canadian Chamber of Commerce, which is Canada's largest and most active business network. We represent 400 chambers of commerce across the country and more than 200,000 businesses of all sizes—from all sectors and from every part of the country—working to create the conditions for our collective success.

First of all, I'd like to thank the members of the committee for undertaking this important study and for inviting me to participate as a witness. At the Canadian Chamber of Commerce, we're always looking for ways to improve economic growth, productivity and Canada's competitiveness in the global economy.

On the question of free trade within Canada, I'll start by noting that the toughest obstacles to overcome are not always external or flashy. You'll often hear our president and CEO, Candace Laing, talk about the importance of cultural or mindset shifts. That's because, on matters like this, we can't do the quintessentially Canadian thing and be too polite to openly discuss what is holding us back.

Since the U.S. President's election, it feels as though prospects for our economic prosperity have Canadians questioning whether we should have been more deliberate or proactive when it comes to dreaming big. To that end, a by-product of the trade turmoil we have been experiencing has been an acknowledgement of our complacency when it comes to doing the difficult things that will allow us to grow our economy, both abroad and domestically. For the latter, this means getting our own house in order and generally pursuing one Canadian economy by slashing internal trade barriers.

The rationale for action is clear. Study after study has made the case that these barriers only serve to limit our economic growth. In January of this year, an International Monetary Fund report noted that eliminating all non-geographic policy-related barriers “could raise Canada’s real GDP by roughly 7 percent over the long run”, which would have been a $210-billion boost in 2025. This is well in line with the Government of Canada's assessment of $200 billion, or $5,100 per person.

It's also important to highlight the progress we've seen: The appointment of a minister responsible for interprovincial trade in December 2024, the elimination of federal exemptions in the Canadian Free Trade Agreement, the tabling of Bill C‑5, the signing of the Canadian Mutual Recognition Agreement on the Sale of Goods, the approval of the Memorandum of Understanding on Interprovincial Trucking, and ongoing work to address challenges related to various sectors. These are significant measures that have received a lot of support from the business community.

That said, the barriers to interprovincial trade haven't all simply disappeared with the royal assent of Bill C‑5 and the signing of certain agreements. Several barriers still remain within the legislative, regulatory and policy frameworks of provinces and territories, as Professor Mancini has just said. These frameworks were put in place to address similar problems encountered in each province, but they were developed and drafted in very different ways.

The focus is on the provinces and territories that need to do the hard work of looking inward to remove and streamline their own trade barriers. Last week, the Canadian Chamber of Commerce held its first ever Future of Business Summit in Ottawa, which featured a panel of premiers discussing what they can agree on in the current moment. They all noted that removing barriers to internal trade has to be a top priority. Our hope is that, despite the progress thus far, provinces and territories will stay at the table, working towards meaningful progress.

That said, we can't just politely accept that we've come this far, only to settle for “good enough”. If momentum slows, we hope the federal government would consider applying conditions to major federal transfers to provinces and territories that require the elimination of specific barriers to interprovincial trade and labour mobility, as noted in the 2024 fall economic statement. In a moment when geopolitical uncertainty is high and the stability of our most important trading relationship is not a given, it's critical for our provincial, territorial and federal governments to continue this hard and valuable work in order to get the job done.

I thank you again for inviting me, and I thank you for your efforts at building a more prosperous nation. I will be pleased to answer your questions.

[The Chair, Liberal, Judy Sgro]

Thank you, both, very much.

We'll move on to Mr. McCain for up to five minutes.

[Michael H. McCain, Executive Chair, Maple Leaf Foods Inc.]

Thank you and good morning, Madam Chair and committee members.

My name is Michael McCain. I'm the executive chair of Maple Leaf Foods. It's a pleasure to be with you here today.

I'm here to speak to you very candidly about an issue that threatens the safety of Canada's food system and the well-being of Canadian consumers.

Some parties, in the name of interprovincial trade, are calling for actions that will materially erode Canada's globally recognized federal food safety system through the nationalization of what are essentially subpar provincial food safety regulations.

The pursuit of international trade, I believe, is not the issue here. This is a proper objective on which we can all agree. This is about how we accomplish this objective. It cannot come at the expense of food safety and Canadian lives.

Today, as we speak, Canada boasts a world-class food safety system framework, which is enforced by the Canadian Food Inspection Agency. It is nationally and globally recognized as ensuring that Canada has among the safest food in the world. Today, we have a globally recognized national standard.

Canada's federal food safety system is not a barrier to internal trade. Anyone manufacturing and selling food in this country should be adhering to these federal requirements.

Unfortunately, for way too long, Canada has supported a virtually unknown second-tier food safety system. The second system is a patchwork of substandard provincial and territorial regulations. These regulations all differ. They fall desperately short of modern food safety standards, and I would judge the food produced by these substandard systems as unsafe.

In the name of internal trade, advocates are calling for these subpar systems to be legally deemed as equivalent to Canada's globally recognized food safety framework when they are not. What is worse, this fraud would be perpetrated on consumers, who are not even aware of the risk.

There's only one path to fully unrestricted interprovincial trade for food in Canada. This country should immediately eliminate this unsafe second-tier system of mismatched regulatory and inspection systems and align solely around Canada's world-class federal system.

Madam Chair, I don't speak about these issues lightly. In 2008, Maple Leaf Foods was responsible for a listeriosis crisis that killed 23 Canadians on our watch. Since then, federal food safety regulations, tools and standards have advanced significantly. Provincial and territorial regulations have not.

I speak to you today from a place of personal accountability, rooted in the pain that was attached to this serious food safety breach. The consequences of a substandard food safety network are real and tragic.

I ask you today to heed this warning, and I look forward to your questions.

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. McCain, and to our other witnesses.

We'll go to Mr. Chambers for six minutes, please.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you, Madam Chair. Welcome to our witnesses. It's a pleasure to receive your testimony here today.

I have a couple of quick questions.

Mr. Chan, you noted that we still have a number of internal trade barriers. How long do you think we should wait before we expect to make significant improvements?

[Pascal Chan]

I'd hoped that we'd see it quickly, obviously. The crux of my remarks was that we've made good progress so far, but we can't wait much longer to get the job done.

Obviously, given the comments we just heard from Mr. McCain, I am not suggesting that we erode any sort of food safety regulations. He also proposed a path forward for us to get toward free internal trade on that piece. I just wanted to acknowledge that.

Keeping the provinces at the table, and the solutions that we have put on the table as well, we are saying that the federal government does have levers that it could pull. Professor Mancini also raised a number of solutions we could possibly explore constitutionally.

Maintaining the momentum on this and making sure we get the job done over the course of the next year would be very important. That would be our ambition. That's what the business community would like to see.

[Adam Chambers, Conservative, Simcoe North, ON]

Right, or we'll be here in 20 years from now. I'll be long gone, but people will be having the exact same conversations we had 20 years ago.

[Pascal Chan]

Absolutely. As I mentioned, it's a question of culture, mindset and shifting our ambition. We can't accept just good enough. We can't just be too polite to say we need to do the hard work. There are some hard discussions that have been happening and that still need to continue progressing over the course of the next year.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you.

Professor Mancini, was the Comeau decision correct, in your view?

[Mark Mancini]

I've written about this, actually. My view is that the decision was not correct. My view is that section 121 of the Constitution Act prohibits non-tariff trade barriers that strike at the heart or the flow of interprovincial trade.

The Supreme Court came up with a test that I think mimics this, but it will actually not make it easy to find that any of these non-tariff trade barriers are constitutional.

[Adam Chambers, Conservative, Simcoe North, ON]

Would you say that decision set back the push to reduce trade barriers in the country?

[Mark Mancini]

In some ways, I think it provides us with the fodder to do it now, because now we know there's not going to be a judicial pathway out of this. We're not going to litigate our way out of trade barriers. It's going to require a political solution. That's difficult, but the law is limited in what it can do in this particular way—I mean adjudication in courts.

[Adam Chambers, Conservative, Simcoe North, ON]

That's fair enough.

Are you familiar with the court challenges program?

[Mark Mancini]

Yes.

[Adam Chambers, Conservative, Simcoe North, ON]

I recognize that you say we might not be able to litigate our way out of this, but could you not allow or provide resources to the court challenges program to allow Canadians whose economic freedom is being restricted to bring challenges to some of these regulations and challenge the constitutionality or the power and authority of provincial governments to limit their economic and financial freedom?

[Mark Mancini]

The barrier that exists to that, Mr. Chambers, is that there are no real legal grounds to do that. Early in the era of the charter, there was an attempt to use section 7 to strike down barriers on economic liberty. The courts have pretty much rejected all of those types of challenges pretty consistently since the charter was brought in.

Section 7 just doesn't have an economic protection component to it. Even if we could fund these challenges, it really limits their efficacy in establishing a national, frictionless free market.

[Adam Chambers, Conservative, Simcoe North, ON]

I find it fascinating that the court can read in the living tree so many other things that do not happen to be in that document today but will refuse to acknowledge that people have a fundamental right to economic freedom and freedom of movement and mobility in this country.

In any event, I have to ask my final question, because I'm running out of time.

Since we've been waiting so long, don't you think the idea we've proposed to pay and incentivize provinces to reduce their trade barriers is the only thing that's actually going to make them move? The government should give the provinces an upside in a payment to remove the trade barriers in order to get them to do that.

Would either of you recommend that?

[Pascal Chan]

We talked about using the federal transfers and the funds they're already giving to the provinces and asking that they make progress on trade for those barriers.

Frankly, what we really would like to see is that it not come to that. We'd like to have the provinces stay at the table. We know they got together. The ministers responsible for internal trade from the provinces met nine times last year, as opposed to typically about once a year. We hope that progress continues. The important piece we're trying to stress is that we not lose any of this momentum.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you.

Mr. Mancini, do you think it's a reasonable idea?

[Mark Mancini]

I think it's one thing among many.

[Adam Chambers, Conservative, Simcoe North, ON]

Okay. That's wonderful. Thank you.

Mr. McCain, thank you for your testimony. I appreciate your candour here this morning.

In your view, is the path to harmonization around a consistent federal standard—the CFIA standard—that's recognized provincially? Is that what you would hope for as an outcome?

[Michael H. McCain]

Yes, I think that is the win-win here. We achieve one national standard; we reduce all barriers to interprovincial trade, and consumers win.