International Trade Committee on Oct. 27th, 2025

[Adam Chambers, Conservative, Simcoe North, ON]

You don't want ours to go down, though, do you?

[Peter Maddox]

No. I mean, it's difficult; us having a CUSMA exemption and them not is punishing Canadian companies, because now U.S. companies get an advantage coming into the Canadian market that they don't get going into the U.S. market. Ideally, it's an equivalent. Beyond that, it may be a full-on hope that we're going to negotiate that with the U.S., but I think it's definitely worth a try.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you very much.

I'll now turn it over to my colleague Jacob.

[Jacob Mantle, Conservative, York—Durham, ON]

Mr. Greer, has the Canadian government, in the process of the current CUSMA public consultation, directly and proactively reached out to Canadian Manufacturers and Exporters to seek your opinion on this review?

[Ryan Greer]

We've had several discussions with the department and with staff. I think some of that has been at our request, but some of it has been at their request.

[Jacob Mantle, Conservative, York—Durham, ON]

When were those discussions?

[Ryan Greer]

They were mostly over the last three to four months in preparation for the current review, but we had started engaging with the government around the 2026 review as long as 12 to 18 months ago.

[Jacob Mantle, Conservative, York—Durham, ON]

Understood.

You mentioned in your remarks that the longer this process goes on, the worse it is for your members because of the sectoral tariffs that are currently in place on steel, aluminum and autos. How much longer can your members wait for a deal?

[Ryan Greer]

You know, it varies depending on whether you're directly or indirectly impacted. We're having calls every day with members, certainly those who have been hit by 232s, including some who just in the last month and a half have been hit by the new derivative 232 tariffs. We know that the Department of Commerce is sort of undertaking that process again this fall, so there will be more members caught up in that.

For those for whom all of a sudden 50% of their business is being hit with a 50% tariff, it's been fairly hard and devastating. Some are being hit less directly. Their U.S. customers are ordering less simply because their business is soft because of tariffs. Even if everything they ship south is CUSMA exempt, they have a little more runway, but even for them they're all trying to do long-term planning in the best interest of their business and their employees. It's incredibly difficult.

We were in a scenario where it looked like 232 relief was imminent, or there may have been deals this summer and heading through the summer and into the fall, and even as recently as this week's APEC summit. The manufacturing sector has been hanging on and hoping for relief sooner rather than later. We know that these are very difficult, challenging and complex negotiations, to say the least, but we are very hopeful that we can get some 232 relief as soon as possible.

[Jacob Mantle, Conservative, York—Durham, ON]

Would you consider it urgent for your members to get deals on sectoral tariffs?

[Ryan Greer]

Yes.

[Jacob Mantle, Conservative, York—Durham, ON]

I have 30 seconds left here.

You mentioned briefly the remission process. I noted that in one of your studies, over 56% of your members couldn't figure out if they were eligible for remission under the current process. Is that process working for your members or is it not?

[Ryan Greer]

It's been challenging, although I will say that when that survey took place at the beginning of the summer, the remissions process was very new to many of our members. They had never had to participate in it. The government was struggling, I think, with certain resourcing to handle the volume.

Broadly, there are still some challenges with very onerous requests and follow-up requests for additional information, and then slow turnaround timelines for the actual remission. We think there is still room to improve on both of those things.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll go to Madam Lapointe.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Thank you very much, Madam Chair.

I'd like to welcome all the witnesses.

Mr. Maddox, you talked earlier about women accounting for 84%. How many members do you have?

[Peter Maddox]

Our members are the companies these people work for. We have 60 member companies. They represent a large percentage of the direct selling companies that operate in Canada. Each of those member companies may have as many as 20,000 to 30,000 people who are in communities all across Canada. For instance, there's the Mary Kay lady who would be in every small town in Canada. That's where the percentage of women I was discussing comes from. Realistically, a lot of the products sold through the direct selling channel are products that are marketed toward females. That's why that mix has come about, but shout-out to the 16% of men working in the direct selling space as well.

Yes, even though our membership is the direct selling companies, we do feel a responsibility, obviously, to operate in the best interest and work in the best interest of the people who are working for them as independent sales consultants.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

You also talked about the fact that it gave interested people entrepreneurship experience and sometimes helped them start their businesses.

Is there potential for growth in cross-border e-commerce?

[Peter Maddox]

If you're talking about online sales, social media and those sorts of things, obviously our membership jump on social media a lot and utilize social media tools to market their products and talk about the companies that they're working with.

One of the beauties of social media, but it's also one of the challenges, is that it doesn't recognize international borders. That has been very good for many of our independent sellers because they are able to.... Someone might be in Manitoba and have friends in North Dakota, and they can introduce them to a product. That person in North Dakota buys the product, and the person in Canada makes the commission on it. This shows you that, in the direct selling world and in the social media world, there really are no borders. That speaks to some of the challenges that our members are facing with these current trade discussions. There's a push for harder borders, and electronic media and online sales don't tend to recognize that.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

Would you recommend any specific changes to the CUSMA chapter on digital trade?

[Peter Maddox]

In general, we've been pretty pleased with how things have operated under the current agreement. Not being a trade guru to the level of Mr. Greer, I don't know every clause in it, but we have not had complaints over the last six or seven years with the current CUSMA.

What I would turn back to is the point that I think Canada is in a position.... Our industry is typically one of entrepreneurs. As long as consumers are protected and as long as people are protected, we want the government, to some degree, to get out of the way and let our entrepreneurs do what they're doing.

I would like to speak to the really great opportunity for Canada to lower some of those barriers to investment, whether that's getting products regulated.... I talked a little bit about Health Canada in my opening remarks and about whether there is an opportunity to create avenues whereby people can get products regulated and get them to market more quickly. That can incent Canadian companies to start manufacturing in Canada and selling products in Canada as well.

As I mentioned, for us, it's about how we lower barriers rather than how we change the rules.

[Linda Lapointe, Liberal, Rivière-des-Mille-Îles, QC]

In terms of those rules, should consumer protection practices be harmonized across the three countries? Is there a risk of unfair competition related to the resale of American products that don't meet Canadian standards?

[Peter Maddox]

Harmonization is good in theory, but be careful what you wish for with harmonization because sometimes it harmonizes to a code or to a level that our particular country might not be comfortable with.

There is the regulation of natural health products, for instance. Canada has a high level of regulation for health products. We love that. It speaks to the success of our companies in Canada and the level of ethics that they work to. The U.S. tends to have a lower level of regulation for health products. We want to keep it at that level we have. Obviously, if there was a way to bring the U.S. up to that level, that would be good.

I think, based on risk, there are ways that we can lower the regulatory barriers for companies so that we focus on either higher-risk products or higher-risk operations, and then free up those lower-risk products to be sold more quickly, often while they're on trend. If a company wants to introduce a natural health product, sometimes it can take them, in Canada, 12 to 18 months to get that approved at a regulatory level. In that time, the ingredients in that product might not be on trend anymore for people in the natural health space. Meanwhile, they've been selling it in the U.S. and Mexico for the last 12 to 18 months, so that's definitely a challenge that we would like to see overcome.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Thank you to our witnesses. We appreciate your information. We also recognize the challenges that you're facing. Canada is working very hard, and your committee is working very hard and listening very closely.

I will suspend for a few minutes while we bring in our other witnesses, please.

[The Chair, Liberal, Judy Sgro]

I call this meeting back to order.

With us this afternoon, from the Canadian Federation of Independent Business, we have Corinne Pohlmann, executive vice-president, advocacy; and Michelle Auger, director, trade and marketplace competitiveness, national affairs. From Scierie Clermond Hamel ltée, we have David Hamel, operations manager. By video conference from Québec International, we have Carl Viel, president and chief executive officer; and Émile Émond, senior economist.

I'm glad to see that everybody is online and ready to go.

Ms. Pohlmann, would you like to go first, please?

[Corinne Pohlmann, Executive Vice-President, Advocacy, Canadian Federation of Independent Business]

Sure.

Good afternoon. My name is Corinne Pohlmann. I’m the executive vice-president for the Canadian Federation of Independent Business. I’m joined by my colleague, Michelle, who is the director of trade and marketplace competitiveness.

We’d like to thank you for giving us the opportunity to be here today.

As many of you may know, CFIB is a non-partisan, not-for-profit organization representing more than 100,000 small and medium-sized companies across Canada and across every industry and region of the country.

We are here to share a small business perspective on North American trade as we approach the first joint review of CUSMA.

The cost of doing business, as you must know, is at an all-time high due to rising taxes, rent, insurance and other operating expenses, as well as increasing regulatory and compliance burdens. The ongoing trade uncertainty between Canada and the U.S. has created another layer of instability. For many small firms, the tariffs have meant higher costs and tighter margins, which is why it's really no surprise that two-thirds of our members believe that Canada should be moving quickly with the Canada-United States-Mexico Agreement review.

Prior to the trade war, just over half of small businesses were directly engaged in trade with the United States, and thousands more were engaged indirectly through suppliers or clients.

Given the uncertainty, cost pressures, supply chain disruptions and other impacts on small businesses, 92% of Canadian small businesses believe Canada should strengthen its trade ties with other countries besides China and the United States. In fact, we've already seen about one-third of small businesses either fully or partially pivoting away from the United States as a trading partner. However, we must be realistic. Most still conduct some trade with the United States, and so it remains important for Canada and the U.S. to have a stable relationship, which is best done through an agreement like the Canada-United States-Mexico Agreement.

Now, the CUSMA agreement provides a valuable framework that can help smaller businesses navigate and maintain stability across North American markets. However, a number of challenges continue to limit the ability of small firms to take advantage of the agreement.

For example, many small firms are struggling to navigate through the ongoing tariffs. There is a lack of clarity around when and how additional duties apply, and to which products, leaving many businesses unable to plan with confidence.

Beyond tariffs, the cost of shipping goods and currency fluctuations pose additional barriers. While business owners understand that trade involves certain costs, many do not anticipate the numerous barriers that create unnecessary bottlenecks and extra costs in the process.

Now I'm going to turn it over to my colleague, Michelle, for some of the details on some of those barriers.