December 2003

The Voice of Canadian Business ^TM
Le porte-parole des entreprises canadiennes ^MD

EXAMPLES OF BARRIERS TO INTERNAL TRADE

Listed below are examples of barriers to internal trade. These barriers restrict Canadian Chamber of Commerce members from freely doing business between provinces and territorial jurisdictions.

Priority Internal Trade Barriers

Privacy Legislation

Privacy legislation is now beginning to be enacted by the provinces and territories across Canada. A national approach to the protection of privacy and personal information is essential. Privacy legislation should be based on the principles of harmonization, of adherence to the principles of the CSA Code and should maintain a balance of interests between the rights of individuals and the legitimate needs of business. The federal government must work with the provinces to create a nationally consistent privacy regime based on the above principles.

Securities Regulations

Each province and territory has its own "Securities Act" which make it necessary for companies to obtain a legal opinion from each province when beginning to sell a new securities-type product in Canada. Each company wishing to be publicly listed must complete the lengthy and costly procedure of filing 13 separate applications.

Labour Mobility: Ontario-Québec

Ontario launched the Fairness is a Two-Way Street initiative in 1998. This initiative was designed to address the many roadblocks faced by Ontario contractors, construction workers, and aggregate haulers doing business in Québec. Among other things, the initiative included a toll-free hotline for Ontario construction workers, contractors, and truckers facing problems on either side of the border. This hotline is still in operation today and receives many calls.

The initiative eventually led to the Fairness is a Two-Way Street Act , implemented in 1999. The Act specified the following:

• prohibited designated jurisdictions from bidding on government and broader public sector contracts;

• required corporations from designated jurisdictions to first register with Ontario's Jobs Protection Office (JPO) before bidding on non-government contracts;

• required workers from designated jurisdictions to register with the JPO;

• prohibited truckers from a designated jurisdiction from hauling aggregate within Ontario; and

• increased the power of retail sales tax inspectors.

Québec was designated as a jurisdiction to which the Act applied. This designation was removed following an agreement by Québec to implement recommendations outlined in a special report submitted to the Ministers of Labour for Ontario and Québec. The report addressed outstanding issues regarding Québec-Ontario labour mobility, and Québec's compliance with the report was monitored.

After two years of monitoring, Québec was re-designated under the Act in March 2002. Despite the measures outlined in the special report, Ontario workers still faced restrictions.

Other Internal Trade Barriers

Alcoholic Beverages

The province of Québec charges an additional $8.50 per case of 24 bottles/cans of beer sold in Québec but produced outside the province of Québec.

Québec requires that wine sold in its grocery stores be bottled in the province.

Fluid Milk Distribution

Farmer Dairy of Nova Scotia was denied a license to access the New Brunswick fluid milk market.

Coloured Margarine

The provincial governments of Alberta, Manitoba and Ontario are challenging Québec's refusal to lift a ban on butter-coloured margarine.

Newfoundland Mining

The Newfoundland and Labrador government places conditions for granting a mining lease and invests in the Lieutenant Governor in Council the authority to order the further processing of minerals in the province as a condition of granting a mining lease.

Taxis in Ottawa-Gatineau

In spite of the proximity of the two cities, Ottawa-based taxi companies face a number of barriers to picking up fares in Gatineau and vice-versa.

Pharmaceuticals

Pharmaceutical manufacturers face significant barriers with respect to market access. For example, getting a product accepted on provincial drug formularies requires the filing of different submissions and requirements for each province. These individual filings entail significant compliance costs and undue delays for those companies.

Retail Pharmacy

National retail pharmacies face a variety of impediments to doing business inter-provincially. For example, they cannot refill more than once the prescription of an individual from another province. They also face increased costs of labeling requirements that differ from province to province in addition to regulatory differences regarding the distribution of over the counter drugs.

Trucking

Different allowable weights on transport trucks exist between provinces, thus requiring trucks to be reconfigured when driving from one province to another.