exporting to canada: where do we begin? · import/export account • import compliance – it’s...
TRANSCRIPT
The Logistics of Doing Business in Canada
Exporting to Canada: Where Do We Begin?
Wednesday, November 12, 2014 1:00 – 2:00 pm Eastern Standard Time
The U.S. Commercial Service
Agency: – U.S. Department of Commerce
Mission:
– Promote U.S. Exports – Protect U.S. Commercial Interests Abroad – Facilitate Investment in America
Resources for Companies Overseas:
– Counseling – Fair and Open Markets
The U.S. Commercial Service
Specialists assist American companies in export goals by identifying promising new markets and establishing contacts in foreign contracts
In 2009, assisted 5,600 companies with increasing exports – 85% were small to medium size
The U.S. Commercial Service has a global network of trade specialists located in
109 U.S. Cities 128 U.S. Embassies and Consulates in 77 Countries
Market expert specialists Tailored
assistance Export success
Agenda 1. The Canadian Market 2. Building an Export Plan and Marketing Strategy 3. Entering the Canadian Market – Considerations and Customs 4. Regulatory Considerations 5. NAFTA - Benefits 6. Protecting your IP
Woods, LaFortune LLP Woods, LaFortune LLP is an innovative, flexible and proactively cost-effective boutique law firm that focuses on international trade and business, investment, customs, government procurement and government relations. We provide a wide range of services to our clients including advocacy before domestic and international courts and tribunals, strategic advice and analysis, business planning and analytical research. Michael Woods Catherine Walsh [email protected] [email protected] 613.355.0382 613.513.7131
www.wl-tradelaw.com
Since 1912 - International Trade Expertise Second to None
Customs Brokerage, Consulting, Freight forwarding and Distribution
Thompson Ahern International - clearance at all Canadian ports of entry TAHOCO Logistics, Inc. - clearance at all U.S. ports of entry
Competitive and all-encompassing Brokerage Fees Sophisticated IT Systems - Fast, Efficient Release and Accurate Accounting Specialized Non-Resident Importer services Tailor made Billing and Records Options Customizable Systems, Processes & Reports to best serve Your Needs Canadian ACI eManifest and U.S. ACE EManifest Solutions Information and Education – Training, Webinars, Newsletter & Bulletins Total Compliance Program - effective Compliance & Risk Management Strategies Clients include market leaders at all trade levels in diverse industries
A Tradition of Innovation & Excellence - www.taco.ca
Shane Brown LLB, VP Marketing & Compliance 905-678-5476, mobile 416-301-2415
The Canadian Market – Trends • Biggest bilateral economic relationship –over $700 Billion in goods and services • U.S. exports to Canada have increased by 80% over the last decade: Vehicles ($51.7
billion), Machinery ($45.3 billion), Electrical Machinery ($26.8 billion), Mineral Fuel and Oil ($24.7 billion), Plastic ($13.0 billion)
• U.S. exports of agricultural products to Canada totaled $21.3 Billion in 2013: Prepared
Food ($1.9 billion), Fresh Vegetables ($1.8 billion), Snack Foods ($1.3 billion), Non-Alcoholic Beverages ($1.2 billion)
• Expansion in travel and tourism sectors • Renewable energy, mining, oil and gas and environmental-related sectors
The Canadian Market
Common ties play a big part – John F. Kennedy – address to Canada’s Parliament (May 17, 1961): “But we share more than a common border. We share a common heritage, traced back to those early settlers who traveled form the beachheads of the Maritime Provinces and New England to the far reaches of the Pacific Coast…We share common values from the past, a common defense line at present, and common aspirations for the future – our future, and indeed the future of all mankind. Geography has made us neighbors. History has made us friends. Economics has made us partners. And necessity has made us allies. Those whom nature hath so joined together, let no man put asunder.”
The Canadian Market – Key Opportunities
• Aerospace • Automotive
• Defense • Information and Communication Technology
• Mining • Oil and Gas
• Renewable Energy • Safety and Security
• Travel and Tourism • Pollution Control
*http://export.gov/canada/marketresearchoncanada/bestprospectsforuscompanies/
The Export Plan The export plan is an extension of your business plan that identifies:
• Target market(s) • Export goals • Necessary resources • Anticipated results
The Export Plan - Contents • Market Overview
• Purchasing process and buying criteria • Tariff and non-tariff products
• Market Entry Strategy • Product positioning - Pricing strategy • Terms of sale - Distribution strategy
• Regulatory and Logistics • Intellectual Property protection • Modes of transportation and cargo insurance • Trade documentation
For complete template see: http://www.tradecommissioner.gc.ca/eng/step3.jsp
The Marketing Strategy
The 4 P’s of Basic Marketing:
1. Product – what is the product/service and how will it be adapted to the target market?
2. Price – what pricing strategy will you use? 3. Promotion – how will you make customers aware of your product/service? 4. Place – how and where will you deliver or distribute your product/service?
The Marketing Strategy - International 13 P’s of International Marketing: Payment How will you collect payments? What regulations or
laws apply?
Personnel Does your staff have the necessary skills?
Planning Export plan, marketing plan and market entry plan?
Paperwork Customs, regulations, is all the ppw complete?
Practices What are the differences in culture and practice?
Partnerships Partnerships to build a domestic presence?
Policies Planned policies
Positioning How will you be perceived in the market?
Protection IP
The Marketing Strategy - Contents Product or Service Analysis Unique selling points
Market Analysis Economic, social, political and cultural factors
Competitive Analysis Pricing and marketing strategies
Goals Market share, positions, revenue and profit
Marketing Strategy Pricing recommendations, mode of delivery
Implementation Activities, target date, budget
Evaluation KPIs
The Marketing Strategy
• Developing a sales-oriented website • Strong web presence – social media • Establishing a local presence – partnerships
• Licensing • Franchising • Cross-Licensing • Cross-Manufacturing • Co-Marketing
Preparation to be an Exporter and/or Canadian Importer
• Canada Border Services Agency (CBSA) • Importer of Record • Business Number (BN) issued by Canada Revenue Agency (CRA) for an
import/export account • Import Compliance – It’s Good for You • Service Providers: Carriers, Freight Forwarded, Customs Broker,
Customs, Commodity Taxes, Corporate/Commercial and Corporate Tax Counsel(s)
Preparation to be an Exporter and/or Canadian Importer
• Bonded Warehouse Program, Duty Deferral Programs, Duty Drawback upon Export
• Customs Self Assessment (CSA) • Import Security Program (PIP) • Free and Secure Trade (FAST) Program • Returned goods and export procedures
Preparation to be an Exporter and/or Canadian Importer
Resources:
• CBSA – Checklist for Importing Commercial Goods into Canada http://www.cbsa-asfc.gc.ca/import/checklist-controle-eng.html • CBSA – Importing Goods into Canada http://www.cbsa-asfc.gc.ca/import/menu-eng.html • Broker’s website, e.g. Thompson Ahern International http://www.taco.ca/en/canadian_customs_brokerage_non_resident_services.php • CBSA Border Information Services (BIS) from U.S. 204-983-3500 or 506-636-5064
Shipping / Exporting • Carrier or Freight Forwarder • Container, full truck loads, less than truckloads (LTL) • Choice of Carriers – depends on time, product, volume, rate, service
requirements issues: • Trucking company, airline, marine • FEDEX, UPS, DHL • USPS – CBSA via Canada Post deals directly with addressee
• Insurance – loss, damage
• ACI: eManifest; ATD; CSA
Shipping / Exporting
• Warehousing: Customs bonded or post-release • INCO or other terms of shipment, and other terms of sale: Importer,
passage of title, etc. • The Low Value Shipment Program – VFD C$2,500 or less
• http://www.cbsa-asfc.gc.ca/import/courier/lvs-efv/menu-eng.html
• Courier Imports Remission Order – applies to imports via all carriers
Exporting/Importing Specific Products
• US export regulation • Customs Duty and Commodity Taxes • Customs Valuation • Tariff Classification • Tariff Preferences (NAFTA, etc.) • Tariff Classification + Tariff Treatment (e.g. NAFTA TTs = % rate of duty,
if any)
Exporting/Importing Specific Products
• Declaring Packaging • Country of Origin, and Origin Marketing • Anti-Dumping & Countervailing Duties • Cross Border (Div. III) Goods and Services Tax (GST) and Excise Taxes • Duty Relief: Annex Codes, End-Use, Remissions Orders, Damaged
Goods, Returns • NAFTA “Lesser of” Rule and Duties Relief • Duty/GST Deferral
Exporting/Importing Specific Products
• Permits, restrictions or regulations by the CBSA or other government departments
• Other government departments – http://www.cbsa-asfc.gc.ca/import/reflist-listref-eng.html
• Food, plants, animals and related products
• Canadian Food Inspection Agency – http://www.inspection.gc.ca/plants/imports/airs/eng/1300127512994/1300127627409
• National Import Service Centre 1-800-835-4486
• Prohibited Goods – Customs Tariff s. 136, 9897.00.00-9899.00.00; weapons, publications, protected species etc.
Exporting/Importing Specific Products
• Import Labelling • Required documents: Cargo Control Documents (CCD), Invoices,
Certificates of Origin, Import Permits etc. • Customs Reporting, Release and Accounting • Non-Resident Non-Registrant Importer and Div. II GST • Managing Risk and Exposure
Post Importation
• Records – 6 years • Corrective self-adjustments • Verification and adjustment by the CBSA • Penalties, Seizure and Forfeitures (s.110 147 Customs Act) • Administrative Monetary Penalty System (AMPS) • Appeal Rights
Regulatory Considerations • Quotas exist for some products – See Import Control Measures
• http://www.dafit-maeci.gc.ca/eicb/menu-en.asp • Specific requirements for consumer products: Food, Clothing,
Pharmaceuticals, Cosmetics etc. • Enforcement:
• CBSA (http://www.cbsa.asfc.gc.ca/) • Canadian Food Inspection Agency (http://www.inspection.gc.ca) • Health Canada (http://www.hc-sc.gc.ca) • Industry Canada (http://www.strategis.ic.gc.ca)
• Labelling requirements: Rules against Misleading Information, Bilingual
Regulatory Considerations • Consumer Packaging and Labelling Act
www.inspection.gc.ca/English/reg/rege.shtml
• Food and Drugs Act and Regulations
http://www.inspection.gc.ca/English.reg/rege.shtml
• Textile Labelling Act
http://laws.justice.gc.ca/en/T-10/
• Hazardous Products Act
http://www.hc-sc.gc.ca/ahc-asc/legislation/index_e.html
• Guide to the Consumer Packaging and Labelling Act and Regulations
http://competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/h_01436.html
• Consumer Packaging and Labelling Regulations
http://competitionbureau.gc.ca/eic/site/cb-bc.nsf/eng/01248.html
• Guide to Food Labelling and Advertising
http://www.inspection.gc.ca/English/fssa/labeti/guide/toce.shtml
Regulatory Considerations - Standards
Standards Council of Canada co-ordinates Canada’s participation in the International Standards System.
• Canadian Standards Association • Underwriters Laboratories of Canada • Canadian General Standards Board • Bureau de normalization du Quebec • International Standards (NAFTA Chapter 7 & 9, WTO Agreements, TBT, SPS,
TRIPS
NAFTA and Regulatory Co-operation/Harmonization
• Canada-United States Regulatory Cooperation Council (RCC) Action Plan
• 4 sectors – 29 specific initiatives • Scientific and technical cooperation • Harmonized testing procedures • Joint standards
NAFTA-Benefits
“To preserve and extend the benefits our close relationship has helped bring to Americans and Canadians alike, we intend to pursue a perimeter approach to security, working together within, at, and away from the borders of our two countries to enhance our security and accelerate the legitimate flow of people, goods, and services between our two countries.” -http://photos.state.gov/libraries/Canada/303578/pdfs/us-Canada-btb_action_plan.pdf
International Standards and Contracts
• NAFTA – signed January 1, 1994 – Canada, Mexico, United-States • Canada-U.S. Free Trade Agreement (FTA) – 1988 Services • U.S. goods and services trade with NAFTA $1.2 Trillion/year • Exports total $600 Billion • Integrated market – moving to NAFTA Plus
NAFTA – Market Access
• NAFTA goods – duties and quantitative restrictions eliminated by January 2008
• Chapter Three: National Treatment / Non-Tariff Barriers • Chapter Four: Rules of Origin – Is it a NAFTA good?
NAFTA – Sectorial Provisions
• Chapter 6 – Energy and Basic Petrochemicals • Chapter 7 – Agriculture / SPS – Supply Management / Science Based
Standards • Chapter 9 – TBT • Government Procurement – Canadian Government is the largest
single purchaser • http://www.wl-tradelaw.com/government-procurement-and-citt-bid-
challenges-a-brief-guide/
NAFTA – Investment, Services, IP, Labour Mobility
• Chapter 11 – Investment Obligations (Non-discrimination, Fair and Equitable Treatment, Compensation for Expropriation)
• Chapter 11 – Investor-State Dispute Settlement • Chapter 12 – Services – National Treatment Standard • Chapter 16 – Temporary Entry for Business Persons • Chapter 17 – Enforcement of IP Rights
Protecting your IP
• U.S. copyright or patent protection DOES NOT automatically provide equivalent protection in Canada.
1. Have an overall strategy to protect your IP in Canada (consult locally) 2. Rights must be registered in Canada under local laws.
• U.S. Government cannot enforce rights for private individuals or
corporations in Canada.
Questions??
This presentation is intended to provide general information only to authorized users and does not constitute legal advice. No user should act on the basis of any material contained in the presentation without obtaining legal advice specific to the user’s situation.
Woods, LaFortune LLP
Michael Woods Catherine Walsh [email protected] [email protected] 613.355.0382 613.513.7131