WORLD TRADE ORGANIZATION  
ORGANISATION MONDIALE DU COMMERCE  
ORGANIZACIÓN MUNDIAL DEL COMERCIO WT/TPR/M/179/Add.1 
22 June 2007 
 (07-2635) 
Trade Policy Review Body 
21 and 23 March 2007 Original: English/Spanish 
 anglais/espagnol  inglés/español 
  
TRADE POLICY REVIEW 
CANADA 
Minutes of Meeting
 
Addendum  
Chairperson:  H.E. Mr. Vesa Himanen (Finland) 
 This document contains the advance writte n questions, and replies provided by Canada.1 
__________________________________________________________________________________  
Organe d'examen des politiques commerciales 
21 et 23 mars 2007 
 
EXAMEN DES POLITIQUES COMMERCIALES 
CANADA 
Compte rendu de la réunion
 
Addendum  
Présidente:  S.E. M. Vesa Himanen (Finland) 
 
 Le présent document contient les questions écrites communiquées à l'avance et les réponses fournies par Canada.
1 
__________________________________________________________________________________ 
 
Órgano de Examen de las Políticas Comerciales 
21 y 23 de marzo de 2007  
EXAMEN DE LAS POLÍTICAS COMERCIALES 
CANADÁ 
Acta de la reunión
 
Addendum  
Presidente:  Excmo. Sr. Vesa Himanen (Finlandia) 
 
 En el presente documento figuran las pre guntas presentadas anticipadamente por escrito, 
junto con las respuestas facilitadas por Canadá.1 
                                                      
1 In English and Spanish only./En anglais et espagnol seulement./En inglés y español solamente.  WT/TPR/M/179/Add.1 
 Page 3 
 
 
ADVANCE WRITTEN QUESTIONS BY MEMBERS 
 
SINGAPORE 
 
Trade Facilitation  
 
According to the Secretariat (re para 17, page 27) , Canada uses various risk-management techniques to 
process traders who are not approved under the Custom s Self-Assessment and to target shipments of 
higher and unknown risk.  
Could Canada provide more information on its ri sk management techniques?  What criteria does 
Canada use to assess whether a particular sh ipment is of a “higher and unknown risk”? 
 
Services - Telecommunications
 
 In para 107 (page 109), the Secretariat has noted th at all telecom facilities based common carriers must 
be Canadian-owned and controlled, and incorpor ated under federal or pr ovincial laws.  Canada 
currently limits FDI in facilities-based service provi ders to a combined maximum of 46.7% of voting 
shares, based on 20% direct ownership and 26.7% indi rect ownership.  In addition, not less than 80% 
of the members of the board of directors must be Canadian.  
It would be useful if Canada could indicate th e prospects for liberalizing limitations on foreign 
ownership and control in the said telecoms sectors.  
Investment
 
 Re para 20 (page 14), the Secretariat has reported that although Canada is among the OECD countries 
that have liberalized foreign investment significantl y since 1998, it also belongs to the group with the 
highest levels of overall restrictiveness to FDI, as measured by the OECD’s FDI regulatory 
restrictiveness index.  Could Canada comment on the OECD’s findings with regard to its FDI regulatory restrictiveness?  
How have the regulatory restrictiveness in its FDI regime impacted on FDI flows into Canada?  What 
steps, if any, is Canada taking to  liberalise its FDI regulatory regime? 
 The Secretariat Report mentions that a foreign acquis ition above a given threshold is subject to review 
to ensure that it results in a "net benefit" to Cana da.  Could Canada clarify whether different thresholds 
are applied to FTA partners, WTO members and non- WTO members?  How would these thresholds be 
applied should acquisitions be undertaken by join t ventures (eg., a 50:50 joint venture) involving 
companies from countries with different applied th resholds?  We would also appreciate it if Canada 
could clarify whether there are any plans to amend th e said legislation?  If so, when would this take 
place?  
Could Canada elaborate on procedures used by its provincial governments for conduct of their 
procurements?  Are there any central directives or  guidelines issued by the Federal or Provincial 
Government for Canada's provincial entities to comply with?  Canada has enterprises belonging to the Federal and Provincial Governments.  What are the differences 
between these two types of enterprises?  In this conn ection, could Canada  provi de a sample list of it’s 
enterprises?  What are differences in the  relations hip between the two type enterprises and the relevant 
governments, especially in the area of procurement?  In addition, could Canada provide information on 
its crown corporations and companies with shared  governance structures.  What is the difference 
between these types of organizations?  To what extent are the Canadian federal or provincial 
governments involved in these enterprises WT/TPR/M/179/Add.1 
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AUSTRALIA 
 
IV. TRADE POLICIES BY SECTOR 
 (2) Agriculture 
 
(ii) Border and related measures  
We note, as measured by the OECD, overall government  support to agriculture has increased since 
Canada’s last review in 2003.  A lthough this is below the average of OECD Members, we note Canada 
provides significant assistance to supply-managed pr oducts (dairy products, chicken, turkey, eggs) 
including through the use of high out-of-quota tariffs (para. 20 on page ix of the Secretariat’s report).  
• We would welcome an explanation of  the rationale for these policies. 
 
Milk Protein Concentrat es/Tariff Quota Measures 
 
We note from the Secretariat report (page 90, para graph 16) that Canada maintains 21 tariff quotas, 
which are mostly on imports of goods subject to the supply management system.  We also note the press release of 7 February 2007 by the Canadian Ministers of Agriculture and Agri-
Food and of International Trade that Canada would be initiating negotiations under GATT Article 
XXVIII to restrict imports of milk protein concentr ates in response to dairy industry concerns about 
the increasing use of these con centrates in making cheese and other dairy products.  The proposal 
involves incorporating milk protein concentrates into the existing tariff quota regime.  
• Can Canada explain this step, given the current  stage of the Doha Round negotiations and the 
commitment to achieve ‘substantial improvements’ in market access for all agricultural products? 
• Could Canada explain how long it proposes to ma intain the supply management system and 
whether it is considering further Article XXV III proceedings to protect supply management 
effectiveness? 
 Milk protein concentrates are regularly used in cheese production worldwide.  Australia notes that 
Canada has announced a review of compositional standards for cheeses. 
• Could Canada explain the rationale for revi ewing the compositional standards of cheeses; 
specifically mozzarella, cheddar and cheddar-types and fine cheeses? 
• We would be grateful if Canada  could provide the terms of refe rence and proposed timeframe for 
the review? 
 The Secretariat’s report (page 91, paragraph 19) menti ons that rather than esta blishing additional tariff 
quotas, Canada grants preferential access under free trade agreements to the same in-quota volumes 
specified in its WTO tariff quota commitments. 
• Could Canada clarify if preferential imports under free trade agreements are being counted against 
WTO MFN tariff quotas and comment on the cons istency with its GATT 1994 commitments? 
 
Beef 
 
Australia is concerned about the recommenda tion of the House of Commons Committee on 
Agriculture and Agri-Food to introduce unnecessar ily restrictive limits of 1,500 tonnes on 
supplemental beef import permits in  the absence of ‘exceptional circum stances’ (as determined by the 
Minister of Foreign Affairs).  WT/TPR/M/179/Add.1 
 Page 5 
 
 
• The recommendation appears to be inconsistent with  Canada’s approach to free trade particularly 
given Australia and Canada are working together towards agricultural trade liberalisation in the 
WTO. 
o Australia is therefore interested in the rati onale for placing a limit on supplemental beef 
import permits. 
o Australia is also interested in the rationa le for the limit being set at 1,500 tonnes. 
• Has the decision been taken as a consequen ce of access liberalisation for FTA partners? 
• Following the decision, what are the respec tive access entitlements of NAFTA and non-NAFTA 
WTO members? 
• While Australia understands the recommendation is to be reviewed by Canada’s Beef and Veal 
Tariff Rate Quota Advisory Committee, Australia  requests information on what would constitute 
exceptional circumstances. 
 (iii) Domestic Programmes  Canadian Agricultural Income Stabilization Program 
 
In 2003 Canada implemented the Canadian Agricu ltural Income Stabilization (CAIS) Program, which 
integrated the previous Net Income Stabilization Account (NISA) and the Crop Insurance program.  
The CAIS program is touted as a whole-farm risk ma nagement tool, available to all producers, that 
provides protection against both small and large declines in income.  
• How does Canada intend reporting CAIS payments  to the WTO given that production insurance 
payments are considered non-product specific am ber box support while the income stabilisation 
component of CAIS is a partially green box a nd partially amber box depending on the coverage 
farmers choose? 
• Some provinces administer the CAIS directly while in other provinces the CAIS is administered by 
the federal government. 
o Can Canada outline any differences between the province-based and federal-based CAIS 
programmes. 
o Are there differences between province-based implementation and administration of the 
CAIS? 
o Are provinces that administer the CAIS independently from the federal government 
allowed to supplement additional funds to the CAIS  and, if so, how is this reported to the 
WTO? 
 
Notifications 
 Could Canada advise when it will provide these no tifications concerning agricultural domestic support 
(2002 to 2006 inclusive)?  
(8) Air Transport 
 Canada is continuing the process of gradually reform ing its services sector and is an active participant 
in the Doha Round negotiations on services.  Could Canada outline its approach to the nego tiations on air transport services under the General 
Agreement on Trade in Services (GATS)? 
 
Is Canada prepared to make offers on these services?  Does Canada see any barriers to extension of the GATS Annex on Air Transport Services?  (Please elaborate).  WT/TPR/M/179/Add.1 
Page 6  
 
Could Canada indicate why its MFN exemptions rela ting to air transport services are still considered 
necessary? 
 
(9) Professional Services  
With regard to professional services (i.e. accounting,  architecture, engineering and legal), Canada 
maintains a number of citizenship and residency re quirements for accreditation at the sub-federal level 
in its GATS schedule of commitments.  Australia is pleased to note that Canada has offered to remove some of these requirements in its Revised Conditional Offer on services.  
• Would Canada explain the policy rationale for the residency requirements which are not included it 
its current offers?  Is Canada prepared to review  the scope for further liberalisation in the Doha 
Round? 
• Is Canada considering making commitments on legal arbitration and conciliation/mediation 
services?  (See the "Joint Statement on Legal Services" – TN/S/W/37 and S/CSC/W/46 of 24 February 2005 – for a definition of 'legal arbitration and conciliation/mediation services'). 
• Is Canada considering making commitments to a llow admission to practise domestic (Canadian) 
law subject to domestic regulatory requirements? 
 
Education  
 
Canada has not made any GATS commitments on edu cation services.  Would Canada be prepared to 
explore the scope for liberalising this sect or in the Doha Round services negotiations? 
 
SWITZERLAND 
 
Report by the Secretariat 
 
I. Economic Environment 
 
(2) Recent Economic Developments
 
 Para. 9  Canada’s economic performance has been im pressive for some years thanks to booming 
commodity prices and sound economic policies.  Howe ver, raising productivit y growth seems to be a 
major challenge for Canada.  The report mentions a lack of capital deepening as an explanation for the 
low productivity growth.  Do the Canadian authorities share this analysis?  How do the Canadian authorities reconcile the need to undertake a series of  reforms (as suggested by the OECD listing) with 
the fact that not only the activity is buoyant, but al so that resource-rich provinces benefit from windfall 
gains, which releases pressure on public finance?  II. Trade Policy Regime:  Framework and Objectives 
 
(4) Foreign Investment Regime
 
 Para. 22  of the Secretariat’s report indicates that foreign investment to establish a new business in 
Canada, or to acquire control of an existing one, is subject to notification.  Could the Canadian 
authorities indicate if there is a minimum threshold fo r investments to be subject to such notifications 
and, if not, if there are any pl ans to establish such a threshold? 
 Para. 29  of the Secretariat’s report indicates that Cana da notified in 2002 under the WTO Agreement 
on Trade-Related Investment Measur es the websites containing publica tions produced by the federal, 
provincial and territorial governme nt “in which TRIMs may be found”.  Could the Canadian authorities 
indicate in which areas, if any, they still maintain TRIMs in 2007?  WT/TPR/M/179/Add.1 
 Page 7 
 
 
III. Trade policies and practices by measures 
 
(2) Measures Directly Affecting Imports  
(i) Procedures  
Para. 16  of the Secretariat’s report relates to the Customs Self-Assessment procedure, aimed at 
facilitating imports.  Could the Canadian authorities please provide more information on: i) the criteria/requirements applied to become a pre-approve d importer;  ii) the procedural simplifications 
from which an importer under CSA benefits, and iii) are CSA procedures applied together with PARS 
or FIRST or does the CSA allow for similar treat ment as the two simplified procedures mentioned? 
 
(vii) Contingency measures 
(a) Anti-dumping and countervailing measures 
 
Para. 73  of the Secretariat’s report indicates that in limited circumstances, the President of the CBSA 
may launch own-initiative investigations, that is appa rently even in the absence of complaints brought 
by the Canadian industry.  Could the Canadian authorities explain under which circumstances such own-initiatives can be launched and why they consider  it necessary that the authority should have such 
a prerogative even in the absence of co mplaints from the Canadian industry? 
 Para. 74  of the Secretariat’s report indicates that undertakings are accepted only if they are given by 
exporters or government of foreign countries representi ng all or substantially all of the trade in the 
product under investigation (about 85% of the volume of  dumped or subsidized imports into Canada).  
Could the Canadian authorities explain why they seem to be discriminating against smaller exporters or 
exporting countries in the matter of undertaking ?  Al so, do the Canadian authorities consider that such 
a difference in treatment is consistent with Article  6.10 of the Agreement on Implementation of Article 
VI of the General Agreement on Tariffs and Tr ade 1994 (the WTO Anti-dumping Agreement) which 
provides that “the authorities shall, as a rule, determine an individual margin of dumping for each 
known exporter or producer concerned of the product under investigation”? 
 (viii) Technical regulations, conf ormity assessment, and standards 
 
Para. 111  As a general rule, type approval  is used for low-risk products,  whereas individual testing and 
certification is used for higher risk products, for example for medical devices.  Voluntary conformity 
assessment is carried out by SCC-accredited bodies, wh ich are mostly private entities.  The conformity 
assessment activities of the SCC relate primarily to  third-party assessment.  The authorities note that 
Canada relies on a wide variety of strategies to ensu re compliance with technical regulations.  Do we 
assume correctly that type approvals are carried out by  the Canadian authorities?  If this is the case, for 
which reasons do low-risk products require an approv al by authorities?  In Europe, low-risk products 
are normally subject to self-declaration by manufacturers.  Para. 114 Four organizations are accredited by SCC to de velop (voluntary) standards:  the Canadian 
General Standards Board, the Canadian Standards A ssociation, Underwriters' Laboratories of Canada, 
and the Bureau de normalisation du Québec.  These or ganizations administer the technical committees 
that define the content of standards (and voluntary conformity assessment procedures).  The SCC is responsible for reviewing standards submitted by st andards development orga nizations, and following 
the completion of any recommended revisions, appr oving them as National Standards of Canada.  
These standards should be consistent with or shoul d incorporate "appropriate" international standards 
and "pertinent" national standards, and must be  made available for public review during their 
development.  SCC-accredited standards development organizations must allow at least 60 days for 
public review of a draft standard.  Around two th irds of the 921 National Standards of Canada 
approved by the SCC between fiscal years 2002/ 03 and 2005/06 were the same as or based on 
international standards.  Each of the SCC-accredite d standards development organizations issue notices 
of public review for draft standards, and notices of  adopted standards.  The SCC maintains an e-mail WT/TPR/M/179/Add.1 
Page 8  
 
notification service (known as Standards Alert) on cha nges to Canadian (and international) standards.  
Could the Canadian authorities indicate which stan dards are used as a basis for the accreditation of 
these standardization bodies?  (4) Measures Affecting Production and Trade
 
(iv) State-trading enterprises 
 Para. 233  of the Secretariat’s report indicates that st ate-owned enterprises include 44 parent crown 
corporations and three deemed pare nt subsidiaries, which are fully owned by the crown.  Some of the 
crown corporation are conferred with “agency stat us” which means that they enjoy the constitutional 
immunities, privileges, and prerogatives enjoyed by the Crown, which includes immunity from federal 
and provincial taxation.  Could the Canadian authorities provide a list of these so-called “agencies” and 
specify, if any, which of these corporations are mainly or fully engaged in international trade? 
 
IV. Trade Policies by Sector 
 
(2) Agriculture
 
 Para. 1  of the Secretariat’s report indicates that Canada is a highly competitive producer of many 
agricultural commodities, and among the world's largest exporters of agri-food pr oducts.  In para. 15 it 
is mentioned that the average MFN applied tariff fo r agriculture (WTO definition) was 22.4% in 2006. 
Could the Canadian authorities explain why compe titive producers need such a border protection? 
Also, how high is the border protection for the products considered as competitive? 
 (4) Manufacturing
 
 
Para. 77  How do the Canadian authorities assess the ad justment process that the manufacturing sector 
is going through: to what extent can it be explaine d by the exchange rate appreciation (“Dutch disease” 
syndrome)?  Can it be explained by a more st ructural component like increased competition from 
emerging economies (for example in the textile industry)?  Or by other factors?  
NEW ZEALAND 
 
Economic Environment 
 
The Secretariat’s report (WT/TPR/S/179 para 5) no tes that despite Canada’s good recent economic 
performance, relatively slow productivity growth has been a feature of the economy.  It notes that 
productivity growth could be accelerated by, among other things, eliminating barriers to agricultural 
imports and that reform in this sector could lower costs to Canadian taxpayers and consumers.  Does 
Canada have any plans to eliminate these barriers to agricultural imports, to encourage productivity 
growth and greater benefits to Ca nadian taxpayers and consumers? 
 
Agriculture 
 The Secretariat report (WT/TPR/S/179 para 13) not es significant increases in recent years in the level 
of federal and provincial expenditure  in support of the agri-food sector;  some but not all of this is in 
response to drought conditions and the discovery of  BSE in Canada.  Can Canada comment on this 
trend in relation to its WTO commitments on domestic support? 
 
The Secretariat report (WT/TPR/S/179 para 14) notes that according to OECD PSE figures, the most heavily supported commodities in Canada are milk (a t 58%) and beef and veal (at 21%).  We note that 
Canada has made substantial progress in reforming its agricultural policies to less trade distorting 
measures of support but observe that PSE support pe r commodity continues to trend upward.  Can  WT/TPR/M/179/Add.1 
 Page 9 
 
 
Canada explain why PSE support per commodity for b eef and dairy continues to rise and can Canada 
elaborate on whether and how it is addressing this trend? 
 
Border and related measures:  Tariffs 
 Question:   The Secretariat’s report (WT/TPR/S/179, paragraphs 37 & 39) states that the average 
applied MFN tariff in Canada was 3.8% for non-ag ricultural products, 22.7% for agricultural products 
and 313.5% for fats derived from m ilk.  Tariffs in the dairy sector are thus vastly disproportionate to 
MFN tariffs for all other goods.  How does Canada plan  to reduce prohibitive tariffs in the dairy sector 
to a level proportionate  to other products? 
 
Question:   How does Canada see these averages (agricultural and overall) being affected by its recent 
announcement that it plans to invoke Article XX VIII of the GATT to impose tariff-rate quotas on the 
import of milk protein concentrates?  
How does Canada see the Article XXVIII announcement contributing to its foremost objective in the 
Doha negotiations, which is ‘to increase economic opportunities and prosperity for all Members by 
reducing impediments to trade and by enhancing pr edictability in the multilateral trading system’? 
(WT/TPR/G/179, para 15).  
Other Charges affecting imports 
 
Question:   As stated in the Secretariat’s report Cana dian wine made from 100% agricultural produce 
(including cider, wine coolers, fruit wines and sake)  packaged on or after 1 July 2006 is exempt from 
excise duties (WT//TPR/S/179, para 61).  Is Canada  able to explain how this excise tax for 100% 
Canadian grown wine is consistent  or otherwise with Canada’s WT O obligations to provide national 
treatment? 
 
Domestic Programmes 
 
Would Canada elaborate on the rationale behind the continued expansion of its special milk class 
programme, administered by the Canadian Dairy Commission, which seeks to significantly discount 
the price of industrial milk and ot her domestic dairy ingredients?  Ho w are exports of products made 
under this programme being notified to the WTO in relation to Canada’s export subsidies 
commitments?  In this regard can Canada comment on the disparity between the domestic prices and the discounted prices offered under the special milk  class programme under classes 4(a)1, 5(a), (b) and 
(c)?  Can Canada comment on the reasoning behind the expansion of special milk class 5(c) to allow 
for producers of frozen dairy products to access co mpetitive prices for domestic ingredients?  Would 
Canada explain whether the special milk class progr amme is designed to offer discounted industry 
milk/dairy ingredient prices in the production of da iry products already enjoying significant protection 
under Canada’s Uruguay Round tariff  schedule (including out of quota tariffs of up to 300%)?  
(WT/TPR/S/179 paras. 31-32)  Telecommunications and broadcasting services 
 
The Secretariat report (WT/TPR/S/179 para 99) notes that the Government of Canada has issued a 
policy direction to its telecommunications regulator to rely on market forces to the maximum extent 
feasible.  Could Canada provide an update on how the regulator is addressing regulatory reform? 
 
Air services 
 
We note that Canada’s November 2006 Blue Sky Polic y provides a platform for greater liberalization 
of Canadian air services.  Could Canada comme nt on how it is implementing this policy and WT/TPR/M/179/Add.1 
Page 10  
 
achievements to date in the pursuit of “further lib eralisation of Canada’s air transport agreements” 
(WT/TPR/S/179 para 191)?  
EUROPEAN COMMUNITIES 
 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
 
(3) TRADE POLICY FORMULATION AND OBJECTIVES 
 
Sustainable development 
 1. Does the issue of trade and sustainable deve lopment fit into Canada's overall trade policy 
strategies?  
Trade and environment 
 
2. What mechanisms does Canada have in place to ensure adequate coordination of 
environmental policy and trade policy?  
Trade and labour 
 
Canada's Report, page 9, para. 33  
It is stated that "The Canada-Caricom Trade a nd Labour Project (CCTLP) was established in 2005.  
Under this project, a $1 million, three-year activity plan was developed for English and Dutch-speaking 
Caribbean countries to better address the labour dime nsion of international trade and regional economic 
integration".  
 3. Could Canada provide more de tails regarding this project?  In particular, does the project 
address the short term challenges of labour market  adjustment to international trade opening? 
 Canada's Report, page 25, para. 133 
 
Para 133 of Canada's Report on trade and employment  policies states:  "Canada will continue to work 
with other WTO Members and through other intergov ernmental organizations to promote international 
coherence of policies and institutions".  
4. What specific actions does Canada undertak e to ensure sound policy coherence on trade and 
employment issues, including through bilateral agr eements, multilateral policy and the ILO's decent 
work agenda (para 142)?  5. How does this approach relate to the WTO-ILO study on trade and employment published in February 2007? 
 
Canada's Report, page 27, para. 140 
 
Para 140 of Canada's report c overs labour principles and righ ts in bilateral agreements. 
 
6. What mechanisms does Canada use to promot e basic labour/human rights while ensuring that 
such provisions are not used by any party for protectionist means?  WT/TPR/M/179/Add.1 
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(5) INTERNATIONAL RELATIONS 
 
(ii) Preferential trade agreements and other arrangements 
 
WTO Secretariat's Report, page 21, para. 49 
 7. What is the basis under WTO rules for the bila teral preferential agreemen ts with Australia and 
New Zealand?  8. What are the products in which such preferen ces are granted, how much are they worth and 
how much of Canada's trade with each of these partners is covered by them? 
 
WTO Secretariat's Report, page 21-22, para. 51-52  
9. When does Canada expect to conclude its various bilateral FTA ne gotiations (Korea, EFTA, 
Singapore and Central American 4)? 
 10. When does Canada expect to make a decisi on as to whether to launch FTA negotiations with 
the Dominican Republic, Andean community and CARICOM? 
 
Canada's Report, page 14, para. 60-62 
 11. Could Canada elaborate on the progress made w ith its partners on the Security and Prosperity 
Partnership for North America (SPP) initiative?  12. In addition to border measures, what other SPP initiatives will effect Canada's international 
trade and in what way? 
 
Canada's Report, page 23, para. 117  
13. How does the TILMA, signed between British Colu mbia and Alberta, fit within the structure of 
the Agreement on Internal Trade, in particular with the possibility of different decisions arising out of 
each Agreement's dispute settlement process? 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
(2) MEASURES DIRECTLY AFFECTING IMPORTS 
 
(iv) Tariffs  WTO Secretariat's Report, page 31, para. 33 
 
Canada applies a customs duty on olives in brine (H S 2005.07) that discriminates between ripe olives 
(MFN rate:  0%) and unripe (gr een) olives (MFN rate:  8%). 
 14. Could Canada explain the basis for the diffe rence in tariff treatment for both products, which 
are virtually the same thing, except for th e degree of maturity of the olive used? 
 (viii) Technical regulations, conf ormity assessment, and standards 
 WTO Secretariat's Report, page 45, para. 96  
15. What are the competences of the Provinces to adopt technical regulations?  WT/TPR/M/179/Add.1 
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16. What are the areas or sectors in which the Provinces can adopt technical regulations? 
 17. Do these Provincial technical Regulations refer to provincial or federal standards? 
 
WTO Secretariat's Report, page 46, para. 105 
 
18. How can importers to Canada know which provi ncial technical regulations are relevant to 
them?  (ix) Sanitary and Phytosanitary measures  WTO Secretariat's Report, page 50, para.121 
 
19. Could Canada explain the reasons for its recently-launched regulatory process related to 
compositional standards for cheese? 
 
20. How will Canada ensure that the results of th is process will be consistent with international 
standards and Canada's in ternational obligations? 
 
WTO Secretariat's Report, page 50, para. 124 
 In the Secretariat's Report it is stated that "SPS requirements applied to imports are established on the 
basis of the disease or pest risks associated with that  import. It is also sated that in general, a risk 
assessment is conducted prior to first-time imports of  an animal or plant product from a particular 
country."  
A European country requested in 2001 two import perm its for peaches and plums.  The CFIA had been 
since that date working on an import policy for prunus fruits of all origins, until in 2006 a decision was 
made to consolidate all import requirements for all fruits from all origins in to one document, further 
delaying the 5 year wait of this country to obt ain an import authorization for peaches and plums. 
 21. Could Canada explain why the general rule is not be ing followed in this case? 
 WTO Secretariat's Report, page 51, para. 128  
 
It is mentioned that “Canada takes into account the OIE lists of countries recognized free from foot-
and-mouth disease, rinder-pest, BSE, and contagious  bovine pleuro-pneumonia, but reserves the right 
to conduct its own science-based risk assessments for all other diseases”. 
 
22. Could Canada explain why it does not take into account OIE freedom recognition lists for 
diseases such as Newcastle  Disease in poultry? 
 
WTO Secretariat's Report, page 52, para. 135  
 
23. What efforts is Canada making to reduce wa iting times for the authorisation of veterinary 
drugs?   WT/TPR/M/179/Add.1 
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(4) MEASURES AFFECTING PRODUCTION AND TRADE 
 (ii) Incentives and other assistance to business  WTO Secretariat's Report, page 66, para. 193 
 
In the Secretariat's report there is reference to th e assistance programme towards new media.  In the 
appendix, we find further information by reference to Interactive Digital Media Tax Credit (Ontario) 
and Production of Multimedia Titles Tax Credit (Quebec).   
24. Could Canada provide info rmation on the level of public assistance provided by those 
programmes, their duration –if limited in time-, eligib le companies, and the number of beneficiaries 
that have benefited from these programmes so far?  25. Do other provinces of Canada provide similar assistance programmes? 
 
(iii) Government procurement 
 
WTO Secretariat's Report, page 26, para. 11 
 
26. What is the value of federal government pr ocurement in 2004 not covered by the WTO GPA? 
 
WTO Secretariat's Report, page 71, para. 212-214 
 
27. How would Canada reconcile the paradoxical  fact that, on the one hand, prices for 
commodities such as information processing and rela ted telecom services or text processing systems 
and visible recording equipment tend to constantly  decrease over time and, on the other hand, that 
standing offers' established prices are frozen for a long period of time (2-3 years)? 
 
WTO Secretariat's Report, page 72, para. 219 
 
28. Could Canada indicate, even approximatively, how much in percentage of overall procurement 
represent contracts not subject to NAFTA Chapter 10 or  to the GPA, reviewed by the interdepartmental 
Procurement Review?  
WTO Secretariat's Report, page 73, para. 222 
 29. Could Canada explain the reasons for th e increased use of Advance Contract Award 
Notifications and stringent technical requirements to  restrict public contracting to preferred suppliers? 
 
WTO Secretariat's Report, page 76, para. 230 
 
30. Could Canada explain the increased use of sole -sourcing in important procurement contracts at 
the provincial level? 
 
(iv) State-trading, state-owned companies and privatization 
 
WTO Secretariat's Report, page 76, para.231 
 
Canada conducted in 2006 audits of Cost of Service Differentials (COSD) between domestic and 
imported products for several Liquor Boards (Ont ario, Quebec and British Columbia).  Under the 
Importation of Intoxicating Liquors Act (IILA) each province and two territories have monopolies on the introduction of all alcoholic beverages into their territories both from abroad and from other 
provinces.  Under the IILA, liquor, including wine, considered intoxicating by provincial law may be WT/TPR/M/179/Add.1 
Page 14  
 
imported only by a board, commission, officer, or governmental agency legally authorized to sell 
intoxicating liquor.  Distribution and warehousing servi ces for importers are generally also reserved for 
the provincial liquor boards.  As re ported in Canada's last review, ei ght of the twelve provincial liquor 
jurisdictions in Canada apply a higher services charge to imported products.  According to the 
authorities, the difference reflects higher carrying costs (i.e. the interest cost of holding product in 
inventory) as well as higher operational co sts associated with imported products. 
 31. Could Canada elaborate on the conclusions of these audits and on the possible actions taken by 
the Liquor Boards to minimize COSDs?  (v) Competition policy and regulatory issues 
 
WTO Secretariat's Report, page 79, para.242 
 
32. Could Canada specify to which turnover the thresholds of CAN$35 and 50 million respectively 
apply and by who this turnover must be reached (Tur nover of all participating companies?  Turnover of 
one company?  World-wide turnover?  Or only domestic turnover?)?  
(vi) Intellectual property rights 
 WTO Secretariat's Report, page 80, para. 249  
 
33. Could Canada provide information on the f unctioning of its IPR enforcement mechanisms at 
the borders and on what efforts it undertakes to strengthen these activities? 
 
WTO Secretariat's Report, page 84-85, para. 260-261  
 
The WTO panel ruling in European Communities – Protection of Trademarks and Geographical 
Indications for Agricultural Products and Foodstuffs (DS174 and 290) confirmed that the co-existence 
of a geographical indication and a prior tradem ark is allowed under Article 17 of the TRIPS. 
 34. Is that co-existence possible under Canadian la w?  Is such coexisten ce made possible through 
the application of Section 20 of the Canadian Trademark Act? 
 According to Section 9(1)(n)(iii) of the Trade-marks Act ( R.S., 1985, c. T-13 ), "No person shall adopt 
in connection with a business, as a trade-mark or ot herwise, any mark consisting of, or so nearly 
resembling as to be likely to be mistaken for any badge, crest, emblem or mark iii) adopted and used by 
any public authority, in Canada as an official ma rk for wares or services" in respect of which the 
Canadian Trade-marks Office has given public notice of its adoption and use.  35. What are the rights corresponding to the public authorities which have been issued such public 
notice on the use of an "official mark" under Canadian law?  
36. Can such public authorities use these official marks in parallel to an existing trademark? 
 On 30 November 2005, the Canadian Federal Cour t ruled on the action by the Canadian Post 
Corporation (CPC) against the decisions of the Canadi an Registrar of Trademarks to give public notice 
of the adoption of 13 official marks by the United States Postal Service (USPS).  This ruling sets aside 
those decisions on the grounds that, in order to be entitled to an official mark, a public authority must 
be a public authority "in Canada";  i.e. subject to governmental control in Canada. 
 37. What are the implications of this interpre tation of the Canadian Federal Court on cases when 
the TMO has already recognised the right of a fo reign public authority to use an official mark? 
  WT/TPR/M/179/Add.1 
 Page 15 
 
 
38. Do Canadian authorities consider this interp retation consistent with the national treatment 
obligation under WTO Agreements, most particular ly under Article 3 of the Agreement on Trade 
Related Aspects of Intellectual Property Rights (TRI PS) and Article III:  4 of the General Agreement 
on Tariffs and Trade (GATT 1994)?  If so, how is this  interpretation justified?  If not, how do Canadian 
authorities intend to remedy this situation? 
 
Article 18 of the Canadian Trade-marks Act establishes the cases where registration of a trademark is invalid. According to Article 22.3 of the TRIPS, th e Canadian Trademark Office should "invalidate the 
registration of a trademark which c ontains or consists of a geogra phical indication with respect to 
goods not originating in the territory indicated, if us e of the indication in the trademark for such goods 
in that Member is of such a nature as to mislead the public as to the true place of origin”.  However, 
Section 18 of the Canadian Trademarks Act (CTA) sets out only four instances in which a trademark 
can be invalid:   The trademark was not registrable at the date of registration 
 The trademark is not distinctive at the time pr oceedings bringing the valid ity of the registration 
 into question are commenced  The trademark has been abandoned  The applicant was not the person entitled to secure the registration  39. Does Canada consider that it has implemen ted its obligation under Article 22.3 of TRIPS 
through Section 18 of the Canadian Trade-marks Act?   If not, which other legislative act implements 
this TRIPS obligation?  Article 22.3 of TRIPS allows an interested party to invalidate a trademark regist ration which consists of 
a geographical indication with respect to goods not orig inating in the territory, if use of the trade-mark 
for such goods in Canada "is of such nature as to mislead the public as to the true place of origin".  
Section 18 of the Canadian Trademarks Act (CTA) esta blishes that a trademark can be invalid when the 
trademark was not registrable "at the time of registration".  40. Should Section 18 of the CTA be consider ed as implementing Article 22.3 of TRIPS, do 
Canadian authorities interpret this provision as to a llow an interested party to invalidate a trademark 
consisting in a geographical indication only when th e trademark in question mislead the public "at the 
time of registration"?  Or would Section 18 also allow an interested party to invalidate a trademark when it becomes over the time misleading to the public?  
IV. TRADE POLICIES BY SECTOR 
 
(2) AGRICULTURE 
 
Most of the elements of the Canadian Agricu ltural Policy Framework (APF) expire in 2008. 
 41. As work is already underway to transform th is Framework, could Cana da at this stage give 
preliminary information on foreseen changes in the APF and what impact they could have on future 
Canadian agricultural imports?  42. Could it be explained to what purpose Cana da spent over CAN$5 billion over 5 years to 
implement the APF? 
 
43. How does Canada justify vis-à-vis relevant GA TT rules the tax exemption measure it applies to 
wines produced from Canadian grapes?  
 WT/TPR/M/179/Add.1 
Page 16  
 
WTO Secretariat's Report, page 87, para.3 
 
In the Secretariat's report it is stated that in so me provinces, agricultural producer boards regulate the 
marketing of certain agricultural products, including by setting prices.  
44. Do any of these agricultural boards regulate or control the marketing of any agricultural 
products for exports? 
 
WTO Secretariat's report, page 90-92, para 20-22?  
45. Could Canada provide more detail as to the type  of milk protein concentrates to be covered 
under its recent decision to request GATT ART XXV III negotiations, including the proposed changes 
to its customs tariff?  
WTO Secretariat's report, page 93, para.31 
 
46. Could Canada provide more details on the re cent decision to add 'single serve ice cream 
novelties' as be eligible for Class 5(c) special pricing?  In particular, how has this decision affected the 
domestic price for the dairy produc ts used to produce these products? 
 
WTO Secretariat's Report, page 96 , para.42 
 Under the Agricultural Products Marketing Act (APMA), the Federal Government may grant 
provincial entities, including boards and agencies, authority to "regulate the marketing of [any] agricultural product in interprovincial and export trade".  In some cases, these powers include the 
authority to set production quotas and prices. 
 
47. Could Canada specify the amount of total suppor t for farmers as a result of those local market 
regulation programs?  48. How does Canada notify those local market support programs to the WTO?  WTO Secretariat's Report, page 98 , para.52  
The report states that the CWB has two export cr edit programmes, the Credit Grain Sales Program 
(CGSP) and the Agri-Food Credit Facility (ACF).  
49. Could Canada specific the length of the repayments periods under these export credit 
programmes?  
(4) MANUFACTURING 
 
(iv) Automotive industry 
 
WTO Secretariat's Report, page 107, para. 95 
 
50. Could Canada provide further information on the development of its standards and other 
requirements for the automotive sector? 
 
51. Does Canada plan to further harmonise its domestic provisions with those of international 
organisations and in particular UN- ECE regulations?  In pa rticular, the EC would be interested in the 
areas of self-certification with safety regulations, crash testing requirements, and bumper impact resistance requirements. 
  WT/TPR/M/179/Add.1 
 Page 17 
 
 
52. Does Canada plan to allow for any particul ar flexibility and special compliance options for 
small volume manufacturers with low sales figures?  
(5) TELECOMMUNICATIONS AND BROADCASTING SERVICES  
 
WTO Secretariat's Report, page 109, para. 104-110 
 
53. Could Canada provide info rmation on how the level of license fees is determined? 
 
WTO Secretariat's Report, page 109, para. 106 
 
54. What assessment has been done on the impact of  the restrictions on foreign ownership for the 
development of competition in the market?  55. According to which timeframe is Canada pla nning the lifting of foreign ownership limitations? 
 
Fixed to mobile termination rates are not imposed nor published.  56. Does this apply also in th e case that there is dominance in the market?  How does Canada 
ensure that prices are not excessive in the case that dominance is found? 
 
WTO Secretariat's Report, page 110, para. 111-112  
57. Could Canada inform whether there is a cer tain time limit within which an interconnection 
dispute needs to be resolved?  (9) PROFESSIONAL SERVICES 
 
WTO Secretariat's Report, page 128, para. 195 
 
In the WTO Secretariat's report, it is mentioned that "in the provinces of Ontario and Alberta, members 
of a law society are required to be  permanent residents in Canada." 
 
58. Could Canada clarify if this requirement al so applies to the cross-border supply of legal 
services into Canada?  Canada's GATS schedule of specific commitments li sts for Foreign Legal Consultants (CPC 861*) in 
the market access column under mode 4 a requirement  to be "permanent resident for accreditation." 
 59. Could Canada explain why this  mode 4 requirement is scheduled in the market access column? 
 60. Could Canada also clarify whether or not this residency requirement is needed: 
 
 (a) to provide legal services as a Foreign Legal Consultant? 
 (b) only for accreditation?  (c) for obtaining a license to practice as a Foreign Legal Consultant?  Canada provides for the right to practice as a Foreign Legal Consultant (FLC) in Saskatchewan and 
Ontario without meeting normal accreditation requireme nts if the FLC has practiced the law of his/her 
country for at least three complete years in the case of Saskatchewan and for at  least the five preceding 
years in the case of Ontario.  61. Could Canada explain what re quirements have to be met by Ca nadian citizens (lawyers or non-
lawyers) in order to provide advice on foreign a nd international law in Ontario and Saskatchewan? WT/TPR/M/179/Add.1 
Page 18  
 
WTO Secretariat's Report, page 130, para. 205 
 
62. Could Canada indicate whether, in the nego tiation of such MRAs, these representatives of the 
professions exercise powers delegated to them by cen tral, regional or local governments or authorities 
within the meaning of article I.3.(a)(ii) of the GA TS so that the arrangements can be considered as 
mutual recognition agreements concluded by the Canada as a member of the WTO? 
 63. If the answer to the preceding question is ne gative, could Canada indicate whether, once it 
notifies those arrangements under Article VII of th e GATS, Canada, by way of such notification, 
become, as a WTO Member, bound by those arrangements under international law? 
 
64. If the answer to the two preceding questions is  negative, taking into account that Canada is 
able, as a WTO Member, to undertake commitments in respect of professional and business services 
and in developing disciplines on domestic regulation under article VI paragraph 4 of the GATS, could 
Canada indicate which are the re asons that prevent them from negotiating, as a WTO Member, MRAs 
in respect of professional and business services under article VII of the GATS? 
 
Postal/courier services 
 
Several foreign companies have b een operating in Canada in the area of outbound international mail for 
at least 20 years.  About 2 years ago Canada Post Corporation (CPC), the national post operator, started 
claiming that this activity fell within  its reserved competence and initia ted different actions in order to 
implement its privilege.  These actions were directed at foreign companies, starting with the smallest 
ones that were brought to Courts in 2005 and the cour ts finally issued an injunction (March 2006) to 
terminate the activity of outbound international mail  by November 2006.  Despite the fact that CPC 
action appears to be based on an unfair behaviour, si nce CPC has not been invoking its privilege for 
20 years, Canada Post's actions towards reintr oducing a monopoly at a time postal services around the 
world are opening to competition are sending a very ne gative signal with regard s to Canada's business 
environment. 
 
65. What steps and timeframe do the Canadian authorities envisage to address this situation? 
 JAPAN 
 
Report by Canada (WT/TPR/G/179) 
II. TRADE POLICY DEVELOPMENTS 2003-2004 
(7) TRADE POLICY AND TRADE PROMOTION 
Question 1 (paragraph 92, page19) 
(Closure of Canadian Consulates) 
 The report by Canada mentions Canadian trad e offices in Canadian Embassies and Consulates, 
regarding the decision over the closure of the four  Canadian Consulates (including two Consulates in 
Japan:  Osaka and Fukuoka).  How were these Consulates selected?  What were the principles for the selection?  (8) OTHER INITIATIVES (i) Inter-Provincial Trade Initiatives Question 2 (paragraph 116, page22) 
 
According to the Canada’s report, the federal a nd provincial governments of Canada established the 
Agreement on Internal Trade (AIT) which aims to re duce and eliminate barriers to the free trade within 
Canada, and agreed 11 sectors to focus on. 
  WT/TPR/M/179/Add.1 
 Page 19 
 
 
(1) Please provide information on the recent progr ess of the regulatory reform in the trade of 
alcoholic beverages, which is one of the 11 focused sectors.  (2) Please explain Canadian view which barriers the federal and provincial governments of Canada 
consider to be reduced and eliminated fo r the free trade of alcoholic beverages. 
 
Report by the Secretariat (WT/TPR/S/179)  
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES (4) FOREIGN INVESTMENT REGIME 
Question 3 (paragraph 27 and Table II.1, page16)  
According to the federal government  policy on non-resident owners hip in the uranium mining sector, 
the investment in uranium mining in Canada by fore ign investors should fulfil either of the following: 
 (i) the level of resident ownership of individual uranium-mining properties exceeds 51 per cent at the 
stage of first production; 
 (ii) if (i) is not the case, it can be clearly establishe d that the project is, in fact, "Canadian-controlled," 
as defined in the Investment Canada Act;  or  
(iii) if neither (i) nor (ii) are the case, it can be  demonstrated clearly and approved by the Canadian 
Government that Canadian partners cannot be found. 
 In the case that foreign investors lead a uranium mini ng development, it usually fo rces investors to take 
a huge risk at a great cost, and endure a longer period of time.  Nevertheless, thanks to the Canadian 
policy mentioned above, Canadian enterprises could eas ily invest in the development without bearing a 
risk from the project, at the stage when it is obvious that the development would have succeeded.  These are regarded as the significant indeterminate fact ors for foreign investors to invest in uranium 
mining developments in Canada.  Japanese investor s share the same concerns with other foreign 
investors.  
In this regard, we would like Canada to take into consideration the revision of this policy. 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(2) MEASURES DIRECTLY AFFECTING IMPORTS (viii) Technical regulations, conf ormity assessment, and standards 
Question 4 (paragraph 104, page 46)  
The Secretariat report states that under the Regulator y Policy, the federal authorities must use available 
international standards, guidelines, and recomme ndations "where those standards achieve the 
regulatory objective" sought by Canada. In this rega rd, Japan would like Canada  to provide related and 
detailed information. 
 
(1) How do the federal authorities know or find out whether such available international standards 
exist? 
 
(2) Is there any available quantitative data whic h shows the total amount or percentage of the 
utilization of international standards by federal authorities? 
 
Question 5 (paragraph 105, page 46) 
 
The report by the Secretariat explains that the Sta ndards Council of Canada (SCC) maintains an on-line 
searchable database (known as RegWatch) of all st andards incorporated into Canadian federal 
regulations. In this regard, please provide related and detailed information on the following questions; WT/TPR/M/179/Add.1 
Page 20  
 
(1) What is the total amount and percentage of the SCC standards which are incorporated into 
Canadian federal regulations?  (2) Please exemplify the specific regulations which have incorporated many standards, and the 
ones which have not, and explain reason for the gap. 
 
(3) Are there any voluntary and/or mandatory me chanisms which facilitate or coordinate the 
cooperation between the standard  developing organizations and the federal authorities? 
 
Question 6 (paragraph 113, page 48) 
 The table AIII.3 of paragraph 113 explains the governmental MRAs between Canada and other 
countries.  Regarding this issue, it is stipulated, “The Committee notes that the mutual introduction of cross-border designation systems in equivalent fi elds by governments can be a cost-effective 
agreement.” in paragraph 39 of the WTO docum ent (G/TBT/19) “FOURTH TRIENNIAL REVIEW 
OF THE OPERATION AND IMPLEMENTATION OF THE AGREEMENT ON TECHNICAL 
BARRIERS TO TRADE UNDER ARTICLE 15.4,” completed in Nov. 2006.  (1) Are there cross-border designation systems that Canada’s regulatory authority can directly the 
designate Conformity Assessment Bodies (CABs) in foreign countries based on Canada’s law? 
 
(2) If there are the cross-border designation systems,  please provide the name of the law.  If there 
is no cross-border designation system, Japan would lik e to be informed of whether Canada has legal 
provisions that make it impossible to designate the CABs outside Canada, and what is the logic or 
background behind those provisions?  
Article 6.4 of the WTO TBT Agreement stipulat es that “Members are encouraged to permit 
participation of conformity assessment bodies located  in the territories of other Members in their 
conformity assessment procedures under conditions no less favourable  than those accorded to bodies 
located within their territory or the territory of an y other country.”  It is also written, “The Committee 
renews its encouragement of Members to allow the participation of conformity assessment bodies 
located in the territory of other Members in their conformity assessment procedures, on a non-
discriminatory basis, as stated in Article 6.4. ” in paragraph 36 of the WTO document “FOURTH 
TRIENNIAL REVIEW OF THE OPERATION AND IMPLEMENTATION OF THE AGREEMENT ON TECHNICAL BARRIERS TO TRADE UNDER ARTICLE 15.4.”  If Canada adopts the cross-border designation system , the adoption will contribute to trade facilitation 
for foreign manufacturers willing to export to Canada.  At the same time, this will enable Canada’s 
companies investing in countries outside Canada to  acquire certifications of products by the CABs 
designated under the Canada’s laws in the countries outside Canada, where the production cost is low, 
and quickly forward them to the Canadian market with lower cost for certifications.  It is beneficial for 
Canada’s companies because invest ment in such countries where the production cost is low can be 
promoted. In this regard, it is beneficial not only fo r trade partners of Canada, but also Canada itself. 
 
Question 7 (paragraph 113, page 48) 
 
Please explain the Conformity Assessment System in the telecommunication equipment sector in 
Canada by providing answers to the following questions: 
 
(1) Does the System prohibit suppliers from im porting and selling uncertified telecommunication 
equipment in the Canadian market? Or will licenses and approvals no be issued to use such equipment? 
  WT/TPR/M/179/Add.1 
 Page 21 
 
 
(2) What is a criterion to classify such measures as second party assessment, third party 
assessment and the Declaration of Conformity (DOC )?  Are suppliers allowed to choose one of the 
measures by themselves?  (3) Are there any regulations requiring a certain level of ability to those who conduct a procedure 
of the certifications and/or the DOC?  If so, please provide information on its qualification requirement, 
as well as clarification as to whether such a requirement contains local presence requirement.  (4) What are the obligations for those who acqui re the certifications and/or use the DOC, for 
instance, requirements of registering the certified and/or the DOC equipment to the Canadian 
Government, and storing the releva nt documents?  Does the Canadian  Government conduct inspections 
or make a collection order of those documents?  (5) Are the same obligations as indicated in (4) imposed on those who acquire the certifications 
and/or use the DOC on the basis of the MRA? 
 
(6) Please provide information on the provisions of the laws and regulations implementing the 
Electro-Magnetic Compatibility (EMC), and information on the name of the authority in charge of the 
EMC.  (7) Please provide information on the procedure and results of the market survey in the 
telecommunications equipment market, conducted by the Canadian Government and private bodies. 
 (4) MEASURES AFFECTING PRODUCTION AND TRADE 
(i) Legal framework for business 
Question 8 (paragraph 184, page 65) 
(Resident Canadian requirement) 
 (1) What are the reasons and background to requi re at least 25% of the directors within a 
corporation to be a resident Canadian unde r the Canada Business Corporation Act (CBCA)? 
 (2) Do all the provinces also require resident Canadian status under the provincial corporation 
laws?  If not, how does Canada explain such an  inconsistency between federal and provincial 
governments?  
IV. TRADE POLICIES BY SECTOR 
(5) TELECOMMUNICATION AND BROADCASTING SERVICES 
(ii) Institutional and legal framework 
Question 9 (paragraph 107, page 109)  
We understand that in Canada, the Telecommunicati on Policy Review Panel, which was established by 
the Ministry of Industry, conducted a review of  Canadian telecommunications framework.  On 22
nd 
March 2006 the Panel proposed the liberalization of  the restrictions on foreign investment in 
telecommunications service providers, and recommended that in the first stage, the new market entrants 
and the telecommunications common carriers with less than a 10-percent market share be examined to 
liberalize the restrictions on foreign investment.  In this regard, we would like to be informed of  the kind of liberalization plan that has been 
implemented, and what progress will be made c oncerning the relaxation and removal of such 
restrictions on the basis of the review.  WT/TPR/M/179/Add.1 
Page 22  
 
Question 10 (paragraph 111, page 109) 
 
The secretariat report states that in the local tel ecommunication services, the incumbent local exchange 
carries (ILECs) are required to provide competitors  with unbundled access under mandated pricing.  
Are there any major suppliers in the mobile mark ets?  We would like Canada to elaborate on the 
provisions of laws and regulations which sti pulate interconnection rules (including unbundling 
obligations) for such major suppliers, if any, in mobile markets.  
Question 11 (paragraph114, page110) 
 
(1) With respect to the Voice over Internet Pr otocol (VoIP) services provided by ILECs, please 
explain why they are regulated only in the local telephone services.  Please provide further information 
on the difference in requirements between local and long-distance services.  (2) We understand that last year the Panel Re view did not recommend to deregulate the VoIP 
services which are provided through the s upplier’s own networks and facilities. 
 Please provide reasons for this and further inform ation on the deregulation plan in the future. 
 
NORWAY 
 "We have taken note that Canada's framework for trade and investment policy is based on shared 
federal-provincial competencies.  What kind of juri sdiction do the provinces have with regard to the 
implementation and application of provincial measures/restrictions regarding international trade?" 
 Comments to chapter:  III. Trade Policies and Practices by Measure 
(4)
 Measures Affecting Production and Trade 
(ii) Incentives and other assistance to business  As a general comment the TPR Report by the WTO- Secretariat provides a good overview and insight 
to the Canadian subsidy regime. However, Norway seeks further clarification on the questions below. 
 
Could Canada clarify the legal basis for its gene ral Federal assistance programmes that are briefly 
described in section 193 of the TPR?  Does Canada ha ve any permanent subsidy legislation, or does 
subsidy legislation vary according to  annual priorities in Federal State Budgets?  If the latter is the case, 
is this legislation renewed or  amended on an annual basis? 
 
Does Canada maintain any subsidy schemes that provide  investment aid as direct grants to investment 
projects, as opposed to the subsidy schemes ba sed on tax measures as described in the TPR? 
 Could Canada clarify the relationship between Fede ral and Provincial assistance schemes?  Are there 
any rules on cumulation of aid from Federal and Pr ovincial subsidy schemes?  Is there any kind of 
national surveillance or national control over the tota l amount of subsidies available to industry and its 
legal basis? 
 
CHILE 
 
III. Políticas comerciales, por medidas 
1) Página 31, Párrafo 8 .  ¿Qué productos y mercados se vieron favorecidos por los 57.000 millones de 
dólares canadienses, en el marco del Fomento de las exportaciones del Canadá (EDC)?   
  WT/TPR/M/179/Add.1 
 Page 23 
 
 
4) Medidas que afectan la Producción y el Comercio 
ii) Incentivos y otras medidas de ayuda a las empresas 
Página 83 . ¿Cuál es el plazo de funcionamiento de los programas a los que se hacen mención?  ¿Existe 
información sobre el funcionamiento de estos? ¿D ónde se encuentra disponible dicha información?  
 iv) Comercio de Estado, empresas de  propiedad estatal y privatización 
Empresas comerciales del Estado 
Página 96 .  Párrafo 233. Se hace menci ón sobre la carencia de disponib ilidad de información relativa a 
las empresas estatales subfederales (sectores en lo s cuales operan, porcentaje de activos totales). 
¿Existe algún sitio Web u otra fuente en donde se pueda encontrar información?  
 
IV Políticas Comerciales por sectores 
2) Agricultura (iii) Programas de ayuda interna: 
Página 116 .  En este subtítulo se hace referencia a lo s diferentes tipos de ayuda interna. ¿Cuánto 
tiempo duran estas ayudas? ¿De qué tipo de medidas se trata? ¿Son éstas de carácter temporal?  ¿Estas 
ayudas podrían eventualmente tran sformarse en subsidios?  
 
6) Servicios financieros 
iii) Servicios de seguros 
Página 151 .  Párrafo 156. El informe señala que las co mpañías de seguros deben obtener una licencia 
en cada provincia para ejercer el negocio y que esto podría complicar el acceso al mercado de los 
proveedores extranjeros. ¿Qué porcentaje de licen cias tienen los proveedores extranjeros? ¿De los 
proveedores extranjeros que solicita n licencias cuántos son rechazados? 
 
9) Servicios Profesionales 
Página 163. Párrafo 199 .  El informe señala que bajo el TLCAN se firmó un acuerdo para que los 
abogados de cualquier país pudiesen actuar como c onsultores extranjeros en terceros países del 
TLCAN.  Aun así,  a la fecha el Acuerdo no se aplica. ¿Cuáles son las razones?  
UNITED STATES 
 
III. TRADE POLICIES AND PRACTICES BY MEASURES 
 
Overview
 
 1. Paragraph 6 on page 25 of the Secretariat repor t states that “Canada is examining alternatives 
to facilitate notification of appr opriate sub-national technical re gulations in a timely manner.” 
 Please provide an update on the status of Canada’s efforts.  Measures Affecting Imports – Anti-dumping and Countervailing Measures
 
 
2. In paragraph 75, page 39, the Secretariat re port states that “Canada operates a prospective anti-
dumping enforcement system in which exporters ar e informed of the normal values for the products 
they export to Canada.  If future sales are made at pr ice levels equal to or higher than the normal value 
of the product, no duties are assessed.”  
(A) Since January 1, 2005, how many refund proceedings has Canada conducted pursuant to 
Article 9.3 of the Antidumping Agreement?  (B) When Canada conducts an Article 9.3 proceeding, how are the imports covered by the 
proceeding determined? WT/TPR/M/179/Add.1 
Page 24  
 
(C) Are all entries from a particular exporter duri ng the relevant period addressed in an Article 9.3 
proceeding, regardless of importer?  (D) How does Canada ensure that the antidumpi ng duties collected from importers do not exceed 
the margin of dumping for the exporte r for the relevant period of time? 
 
(E) Do importers that purchased dumped goods recei ve refunds to account for the extent to which 
non-dumped imports exceeded normal value?   (F) Please identify the relevant provision of Canadian law that addresses each of the above 
questions. 
 (G) Please identify all antidumping investigations since March 2001 that resulted in the application 
of antidumping duties, in which the Canadian aut horities made comparisons pursuant to the “targeted 
dumping” provision in the last sentence of Article 2.4.2 of the Antidumping Agreement. 
 
Measures Directly Affecting Imports - Technical regulations, conformity assessment and standards
 
 3. Paragraph 93 on page 45 of the Secretariat report explains that the Treasury Board Secretariat 
is developing a new Government Directive on Regulating.  
 What are the objectives of the new Government  Directive, and how will it affect Canada’s 
WTO TBT Agreement obligations?  4. In March 2005, the Government of Canada re leased for public consideration a draft policy on 
supplemental fortification of food and beverag es.  What is the status of this policy? 
 
5. The United States Government understands th at Canada’s Processed Products Regulations 
(Canada Agricultural Products Act) prescribe standa rd container sizes for a wide range of processed 
fruit and vegetable products.  For example, the Pr ocessed Products Regulations require manufacturers 
of baby food to sell in only two standardized container sizes.  
Please explain how its requirement to sell in container sizes that exist only in Canada is responsive to 
its WTO TBT Agreement commitments.  Has Cana da changed the regulations?  If not, why not? 
 Measures Directly Affecting Exports - E xport finance, insurance, and guarantees
 
 
6. We note that several support programs in pa ragraph 165 on page 61 of the Secretariat report 
appear to be contingent upon export performance.  Please explain how these programs are consistent with the SCM Agreement.  Measures Directly Affecting Exports - Other measures affecting exports
 
 
7. Paragraph 175 on page 63 of the Secretaria t report states that under the Export Distribution 
Centre Program, businesses can “acquire domes tically produced goods on a GST/HST-free basis” and 
“the benefits to businesses that export substantially a ll their output is that the tax does not have to be 
paid at the time of acquisition or importation of the goods and later claimed back as an input tax 
credit.”  In footnote 177, the report further explai ns that among the eligibility criteria for benefiting 
from the tax exemption is that the business’s “export re venue percentage for the year will be at least 
90%.”  Please explain how this program is c onsistent with the SCM Agreement.  WT/TPR/M/179/Add.1 
 Page 25 
 
 
Intellectual Property Rights - Copyrights  
 8. Table III.16 of paragraph 254 of the Secretariat report (page 82) states that Canada has “signed 
but not ratified” the WIPO Copyright Treaty (WCT) and the WIPO Performances and Phonograms 
Treaty (WPPT) (WIPO Internet Treaties). 
 
Please provide an update on when Canada plans to am end its law to implement the provisions of the 
WIPO Internet treaties.  Intellectual Property Rights - Enforcement
 
 
9. Paragraph 269 of the Secretariat report (page 86) states that “Canadian customs services are not 
entitled to seize infringing imports ex-officio .  Under both the Copyright Act and the Trademarks Act, 
customs officials are authorized to detain goods on ly subject to a court order by the holder of the 
intellectual property right.” 
 
We understand that the Canadian government was co nsulting and reviewing the possibility of granting 
Canadian customs ex officio  authority.  Has there been any progress made on this issue? 
 10. With respect to the information provided in paragraph 264 on page 85 of the Secretariat report, 
will the Bill to Amend the Copyright Act be re-intro duced?  And, if so, will it include a provision to 
criminalize camcorder recording/copying of movies in movie theaters?  
IV. TRADE POLICIES BY SECTOR 
 
Agriculture
 
 11. We understand that Canada has an applicati on system for reviewing and granting waivers to 
allow importation of bulk produce.  
What measures will the Canadian government take to ensure consistency, transparency and timeliness 
in the granting of such waivers?  
State-Trading Enterprises
 
 12. In paragraph 49, page 97, the Secretariat reports  that a task force created by the Minister of 
Agriculture and Agri-Food recomme nded a four-phase transition of the Canadian Wheat Board (CWB) 
from one with “monopoly powers to an environment wh ere farmers may sell their wheat or barley to 
any buyer.” 
 (A) How does the government plan to  work with the recommendations? 
 (B) What is the time frame for implementation, if any? 
 
(C) Have steps been taken to eliminate govern ment guarantee of CWB’s initial payments to 
producers and borrowings?  Mining and Energy – Introduction
 
 
13. Paragraph 63 on page 100 of the Secretariat report explains that the Canadian government has 
continued to fund the development of renewable fuels.  
Does Canada provide tax exemptions on fuels contai ning ethanol, either at the national or subnational 
level?  If so, are there any eligibility requirements that relate to where the ethanol is produced?” WT/TPR/M/179/Add.1 
Page 26  
 
Professional Services - Legal Services
 
 14. Paragraphs 197 and 198 on page  128 of the Secretariat report states that “[f]oreign lawyers 
may be licensed as foreign legal consultants to provi de legal advice only on the law they are permitted 
to practice in their home jurisdiction.”  
 
Please provide statistics for foreign lawyer consu ltants over the last five years, by province. 
 Professional Services - Accounting Services
 
 
15. Paragraph 203 on pa ge 129 of the Secretariat report discusses Canada’s GATS commitments 
with respect to accounting services.  Please provide statistics for the presence of foreign account ants over the last five years, by province. 
 Additional Questions from the United States
 
 
IV. TRADE POLICIES BY SECTOR 
 
Agriculture Sector- Border and Related Measures  
 
1. Referencing paragraph 16 on pa ge 90 of the Secretariat report on Canadian agricultural quotas, 
we understand Canada operates progr ams that allow for imports outside the TRQ system contingent on 
the products, once they are used in processing, being exported.  Does Canada maintain separate data on which pro ducts are imported under these systems and where 
the products are exported?  If so, is the data public ly available and how can members access such data? 
 Agriculture Sector- Domestic Programs
 
 2. In paragraph 30 on page 93, the Secretar iat report indicates that every two months the 
Canadian Milk Supply Management Committee (CMSMC ) sets an industrial milk production target for 
Canada, known as Market Sharing Quota and that each province allocates its share of the Market 
Sharing Quota to producers according to its own policies.  It is our understanding that after the decision rendered by the Dairy Panel in December of 2003,  a group of non-quota dairy producers in Ontario 
argued that they were not subject to the WTO ruli ng since the ruling was not explicit as to whether or 
not it applied to non-quota producers.  Due to th ese types of pressures, we have been made to 
understand that there have been discussions at the fe deral and provincial levels  to develop a new export 
program that would allow for a type of “dual ma rketing” system, one for export and one for the 
domestic market.  Could Canada please provide some information on how such a system could be developed and 
administered in a way that would avoid cross-subsidization? 
 
3. In paragraph 31, page 93, the Secretariat Report notes that Provincial marketing boards and 
agencies set the price at which they purchase milk from producers and sell it to domestic processors;   prices are set in accordance with the end use.  
(A) We note that when Canada notifies product sp ecific support in dairy, the support is based only 
on the administered prices for butter and skim milk powde r.  Is Canada able to demonstrate that there is 
no price support effect to other dairy products in  Canada's milk pricing system beyond these two 
administered price supports?  If there is in fact a price support effect on other dairy products, would a 
broader production base be more appropr iate to use in the notification? 
  WT/TPR/M/179/Add.1 
 Page 27 
 
 
(B) Does Canada maintain a price support mechanism for fluid milk?  4. Paragraph 33, page  93 of the Secretariat report states that Canadian producer prices for poultry 
are negotiated between provincial po ultry producer boards and processors based on a cost of production 
formula, and for eggs, each provincial egg board sets th e price that grading stations pay to producers.  
 
Are these fixed prices such that processors and grading stations are required to pay this fixed, minimum price?  Is there any allowance for another price to be paid?  
HONDURAS 
 
INFORME DEL GOBIERNO 
 
I. ENTORNO DE POLÍTICA COMERCIAL Y ECONÓMICA  1. En el párrafo 11, página 2 del informe de l Gobierno de Canadá se señala lo siguiente: “Al 
mismo tiempo, las inversiones extranjeras directas  se elevaron a 41.000 millones de dólares en 
2005, en comparación con los 2.000 millones de dólares del año anterior.  Este espectacular 
crecimiento se debió en gran medida a las m ayores inversiones extranjeras directas en los 
sectores de la energía y los min erales metálicos del Canadá”. 
 
¿Podrá Canadá dar más detalle  sobre la IED en Canadá? 
¿De que país provienen las inversiones extranjeras directas?  
INFORME DE LA SECRETARÍA DE LA OMC 
 
OBSERVACIONES RECAPITULATIVAS 
 
1) E
NTORNO ECONÓMICO  
 
2. En las observaciones recapitulativas, página  vii, se señala lo siguiente: “El régimen 
comercial del Canadá no se ha mo dificado de manera significativa desde su último examen en 
2003. Persisten limitaciones a las inversi ones extranjeras en sectores como las 
telecomunicaciones, los servicios audiovisual es y el transporte aéreo y marítimo”. 
 
Podría Canadá ampliar ¿cuáles son las limitaciones a la inversión en estos sectores?, ¿en el sector de telecomunicaciones?  
¿Cómo se conjugan los compromisos de Canadá en el marco de los Compromisos en la OMC, y en lo 
relacionado con el cuarto protocolo de telecomunicaciones? ¿Está Canadá dispuesta a consolidar o eliminar dicha restricción en el marco de las negociaciones de Doha?  6) P
OLÍTICAS SECTORIALES  
 
3. En las observaciones recapitulativas, párrafo 25,  página xi, se indica lo siguiente:  “En el 
sector del transporte marítimo, el cabotaje si gue reservado a los buques de pabellón canadiense, 
aunque se permite el acceso de buques extranjeros”. 
 Podría ampliar Canadá,  ¿en qué forma se  permite el acceso de buques extranjeros? 
¿Cuáles son las limitaciones que tienen lo extranjeros para prestar el servicio?  
4. En las observaciones recapitulativas párrafo  26, página xi, se menciona lo siguiente: 
“Prácticamente todas las profesiones están reg lamentadas. Aunque, en algunos casos, siguen WT/TPR/M/179/Add.1 
Page 28  
 
aplicándose prescripciones en materia de ciudadanía y residencia, se han suprimido ciertos 
obstáculos en años recientes”. 
 
Podría Canadá dar más detalle sobre los obstáculos  ¿Todas las profesiones o ciertas son las que se exige el requisito de residencia y ciudadanía? 
¿Qué obstáculos son los que se han suprimido? 
¿Cómo afectan los compromisos en el Modo 4?  II. RÉGIMEN DE POLÍTICA COMERCIAL:  MARCO Y OBJETIVOS 
 
1) V
ISIÓN GENERAL  
 
5. En la página 12, párrafo 3, se indica lo siguiente: “El Canadá mantiene una política de 
trato nacional para la inversión extranjera direct a, sujeta a restricciones específicas por sectores 
en relación con la pesca, minería y energía, tr ansporte aéreo, telecomunicaciones y actividades 
culturales”.  
Podría Canadá ampliar ¿qué tipo de restricciones está sujeta la IED? ¿Si las restricciones en inversión en el sector de telecomunicaciones cumplen con los compromisos 
asumidos por Canadá en el cuarto protocolo?  
 6. En la página 12, párrafo 3, se menciona lo siguiente “las adquisiciones extranjeras que 
superen un determinado límite están sujetas a un examen con objeto de asegurar que tengan 
como resultado un "beneficio neto" para el Canadá” . 
 Podrá ampliar Canadá ¿qué tipo de examen? 
¿Qué autoridad  es la que realiza el examen? ¿se refiere a pruebas de necesidad económica?. Si este es 
el caso ¿cómo se relaciona con los compromisos en el AGCS?  2)
  M ARCO JURÍDICO GENERAL  
 
7. En el página 13, párrafo 6, se menciona la estructura del poder judicial en Canadá. 
 
Podría Canadá explicar ¿en qué consisten los tribunales cuasi  judiciales? 
¿Cuál es su competencia y su jurisdicción? ¿Cuál es la ubicación de los tribunales cuasi  judiciales en el ordenamiento jurídico del Canadá? 
 
5) R
ELACIONES INTERNACIONALES  
 ii) Acuerdos comerciales preferenciales y otros acuerdos  a) Acuerdos de libre comercio 
 
8. En la página 23 y al párrafo 43 se indica que  “las diferencias relativas a las disposiciones 
sobre inversiones del capítulo 11 del TLCAN se solucionan mediante un proceso de arbitraje 
entre el inversor y el Estado ”. 
 
Podría Canadá proveer más detalle, ¿dónde es más activ o el arbitraje, si por diferencias en inversión 
o por diferencias en comercio? 
 9. En la página 23 y al párrafo 43 se indica también lo siguiente “la tercera diferencia se refiere a un inversor estadounidense que aleg a que medidas adoptadas por el Gobierno de 
Ontario impidieron a una empresa de ese Estado que  dicho Gobierno controla explotar una mina 
abandonada como depósito subterráneo”.  WT/TPR/M/179/Add.1 
 Page 29 
 
 
Podría Canadá indicar ¿en qué consistía las medi das adoptadas por el Gobierno de Ontario y en qué 
legislación se fundamentan dichas medidas? 
 
III. POLÍTICAS COMERCIALES, POR MEDIDAS 
 
2) M EDIDAS QUE AFECTAN DIRECTAMENTE A LAS IMPORTACIONES  
 ix) Medidas sanitarias y fitosanitarias (MSF)  
10. En el párrafo 122, página 62, del informe de la Secretaría se menciona que el CFIA 
concluye a menudo acuerdos sobre productos esp ecíficos con gobiernos extranjeros en relación 
con cuestiones relativas a inocuidad de los alimentos y la sanidad animal y vegetal. 
 
¿A qué tipo de productos específicos se refiere cuan do se habla de establecer acuerdos bilaterales con 
gobiernos extranjeros?  
¿En qué se diferencia este procedimiento al que norm almente se utiliza para permitir el acceso de otros 
productos similares? ¿Qué tipo de prescripciones deben cumplir?  
 
11. En el párrafo 124, página 62 del informe de la Secretaría se menciona que por regla 
general, las autoridades realizan una evaluación  del riesgo previamente a las importaciones que 
se realizan por primera vez de un animal o planta , o un producto de origen animal o vegetal, 
procedentes de un determinado país.  
¿Se realiza algún tipo de seguimiento posterior pa ra determinar la necesidad de una siguiente 
evaluación de riesgo? ¿ En qué casos aplicaría ? 
 
12. En el párrafo 126, página 63, del informe de la Secretaría se menciona que a veces las 
provincias realizan  sus propias evaluaciones del riesgo en cuestiones fitosanitarias para 
determinar la necesidad de aplicar prescripciones provinciales, pero por lo general se basan en 
las evaluaciones federales.  
En caso de que un producto haya cumplido con la eval uación de riesgo a nivel federal, ¿se podría dar el 
caso de que las prescripciones provinciales restri njan su ingreso a esa provincia específica o 
prevalecería la evaluación federal en toda circunstancia?  ¿Tendrían trato especial los productos contemplados en  el marco de un tratado de libre comercio, en 
relación a no restringir su acceso a todo el territorio canadiense? 
 
13. En el párrafo 127, página 63, del informe de la Secretaría se señala que las evaluaciones 
de las solicitudes de importación de animales y productos de origen animal que entrañan una 
evaluación del riesgo pueden llevar hasta un año.  
¿El plazo de un año incluye hasta que se emite la resolución de aprobación o no, del respectivo permiso 
de importación? Una vez hecha la evaluación de riesgo, ¿puede el producto de que se trate tener acceso de inmediato o 
sigue un procedimiento administrativo posterior a ello? En caso afirmativo, ¿cuál sería el tiempo 
promedio que le toma a un producto para ingresar a territorio canadiense desde el momento que se 
presenta la solicitud de evaluación hasta que se le  otorga el respectivo permiso de importación? 
 ¿Cuál es el plazo que rige para la vigencia de un perm iso de importación? 
¿Podrían proporcionar información de los últimos tres años de las solicitudes de evaluación de riesgo y 
tiempo promedio en atender las mismas? ¿Cuáles son los requisitos de admisibilidad de  los productos de origen animal y vegetal? 
 WT/TPR/M/179/Add.1 
Page 30  
 
IV. POLÍTICAS COMERCIALES, POR SECTORES 
 
6) S
ERVICIOS FINANCIEROS  
 i) Introducción  
 14. En la página 142, párrafo 121, se señala que “en marzo de 2006 había tres sucursales de bancos extranjeros más que tres años antes. Todos los bancos nacionales eran de propiedad 
privada”. 
 ¿De qué nacionalidad son las sucursales de bancos extranjeros? 
¿Aplica la legislación federal, provincial?  ¿Está la legislación provincial sujeta a compromisos por parte de Canadá en el marco de la OMC?  
 
15. En la página 144, párrafo 131, se menciona que “el Gobierno tiene la intención de 
eliminar el requisito de que el Ministerio de Ha cienda apruebe la entrada de "cuasi bancos". 
Estos son entidades extranjeras que suminist ran servicios de tipo bancario, por ejemplo 
préstamos al consumidor, pero que en su jurisdicción nacional no están sujetos a la reglamentación de la banca o a una similar”.  
 
Podría Canadá ampliar sobre la figura de “cu asi bancos”, ¿cómo operan?, ¿se requiere licencia, 
permiso?, ¿qué autoridad es la que lo regul a?, ¿se aplica a nivel federal y/o provincial? 
 
16. En la página 146, párrafo 137, se indica que  las sucursales de banc os extranjeros están 
sujetas a las mismas restricciones. 
 ¿Puede Canadá proveer más detalle sobre las restri cciones a que están sujetos las sucursales de bancos 
extranjeros?  ¿A qué tipo de restricciones se refieren?  ¿Cómo está esto relacionado con los compromisos de Canadá en la OMC?  
17. En la página 147, párrafo 143, se dice que la  OSFI ha publicado los criterios y requisitos 
en materia de información que deben cumplirse pa ra establecer y explotar sucursales de bancos 
extranjeros. 
 
¿Está disponible en alguna página Web el documento publicado por la OSFI? 
¿Se puede obtener copia del documento? 
¿Puede Canadá proveer más detalles sobre el docum ento, así como de los criterios y requisitos que 
deben cumplirse para establecer sucursales de bancos en Canadá? ¿se aplica a nivel federal y/o provincial? 
 
THE SEPARATE CUSTOMS TERRITORY OF TAIWAN, PENGHU, KINMEN AND MATSU 
 
Report by the Secretariat ((WT/TPR/S/179)
 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(1) MEASURES DIRECTLY AFFECTING IMPORTS 
(v) Other charges affecting imports  
Question 1:  (paragraphs 60-61 of pages 35-36) 
 
Imported beer is not eligible for lower, tiered excise duty rates, wh ile 100% Canadian wine packaged 
on or after July 2006 is exempt from excise duties. 
  WT/TPR/M/179/Add.1 
 Page 31 
 
 
Could Canada please explain the rationale for impor ted beer not being subject to lower rate(s) while 
100% Canadian wine is exempt from excise duties? 
 (viii) Technical regulations, conformity assessment, and standards 
 
Question 2:  (paragraph 103 of page 46) 
 The Report indicates that “Regulations normally enter into force immediately after registration, but can 
only be enforced once published in Part II of the Ca nada Gazette, which must occur within 23 days of 
registration.”  If we understand it correctly, this stat ement implies that regulations enter into force 
before their publication in Part II of the Canada  Gazette.  Article 2.12 of the WTO/TBT Agreement 
requires that Members allow a reasonable interval be tween the publication of technical regulations and 
their entry into force, in which the “reasonable inte rval” shall be understood to mean normally a period 
of not less than six months, according to the Doha  Ministerial Decision adopted on 14 November 2001. 
 
We wonder how the Doha Ministerial Decision in this respect is being taken into account in Canada’s 
statutory system? 
 (ix) Sanitary and phytosanitary measures 
(Notification of import requirements and plant pest risk assessment)  
Question 3:  (paragraph 120 of page 49) 
 
As indicated, the Separate Customs Territory of  Taiwan, Penghu, Kinmen and Matsu has expressed 
concerns regarding Canada’s 1 January 2005 ban, without proper notification or sufficient science-
based risk assessment, on Enoki mushrooms raised in the growing medium.  We acknowledge that, 
through constructive bilateral discu ssions, Canada subsequently lifte d the two-year ban in January 
2007, permitting the import from us of Enoki mush rooms with trace growing media from designated 
facilities. 
 
In the interests of ensuring co mpliance with the SPS Agreement and the transparency decisions of the 
SPS Committee, we would urge Canada to please notify trading partners of its import requirements 
and carry out sound science-based risk assessment fo r its quarantine measures in the future.  In 
addition, when Canada receives requests from tradi ng partners to review still undecided quarantine 
regulations, could it please respond as soon as po ssible in order to avoid impairing any mutual 
interests? 
 
(4) MEASURES AFFECTING PRODUCTION AND TRADE (i) Legal framework for business  Question 4:  (paragraph 181-192 of page 64-66) 
 
In the World Bank’s “ease-of-doing-business index”, Ca nada is ranked fourth overall out of the 155 
economies surveyed.  Its contributions to the de velopment of global business are widely recognized 
and appreciated.  We have observed that, compared to several other advanced economies, Canada has a 
much more favourable taxation environment, mainly as a result of its continuous programme of tax rate 
reductions.  We have also noticed, however, that  the lower tax rates are applicable to domestic 
corporations only. 
 
We therefore wonder how easy it would be in prac tice for a foreign enterprise to set up a business 
establishment in Canada? 
 WT/TPR/M/179/Add.1 
Page 32  
 
Question 5:  (paragraph 232 of page 76) 
 
The OECD reports that Canada has around 100 stat e-owned enterprises (SOEs), the total asset value of 
which was more than US$50 billion in 2003, accounting for over 5% of its GDP. 
 
We would appreciate knowing: 
 
(a) How many shares does the Canadian government have of these SOEs? 
 
(b) How many State-owned enterprises will be privatized in the future? 
 
(c) What is the timetable? 
 (d) What kind of methods are to be used in the privatization process? 
 
(c) Are there any limitations on foreign investors? 
 (v) Competition policy and regulatory issues 
 
Question 6:  (paragraph 240 of page 78) 
 
As stated in the Report, “With respect to prom oting compliance with the civil provisions in the 
Competition Act, the Commissioner of Competition ma y engage in discussions to obtain voluntary 
compliance or may file an application for an order to remedy a situation.” 
 
(a) Could Canada please elaborate further on wh ether this voluntary compliance programme is 
 initiated by the Commissioner of Competition or operated by the businesses themselves?  If it is 
 the competition authority that initiates the pr ogramme, what are the criteria for choosing the 
 businesses? 
 
(b) What is the procedure fo r joining this voluntary programme?  Do guidelines exist? 
 
(c) What are the consequences if a business viol ates the Competition Act after having joined the 
 compliance programme? 
 
IV. TRADE POLICIES BY SECTOR 
(3) MINING AND ENERGY 
 Question 7:  (paragraph 63 of page 100) 
 
As indicated in the Report, the Canadian govern ment has continued to fund the development of 
renewable fuels;  e.g. the Wind Power Produc tion Initiative and the Renewable Power Production 
Incentive.  What has been the impact of the incentive fundi ng and promotion measures for renewable fuels on 
fossil fuel substitutes? 
 
Question 8:  (paragraphs 64-65 of page 101) 
 
The local (provincial) governments own and manage  the natural resources within their respective 
jurisdictions and empower regulati ons independently, but the Federal Government is responsible for 
the national policy framework as well as trans-borde r environmental impact and polices of national 
interest. 
  WT/TPR/M/179/Add.1 
 Page 33 
 
 
While there is a formal mechanism for periodic coopera tion between federal, provincial and territorial 
governments on energy issues, we would be interested  in knowing whether c onflicts have ever occurred 
between these government bodies, especially in promo ting further development of the sector involved 
and in encouraging private investment and competition?  If so, what guidelines are followed to settle 
disputes? 
 
Question 9:  (paragraph 67 of page 101) 
 As indicated, the National Energy Board (NEB) may grant long-term export licences for oil, gas and 
electricity only after due consideration has been given to meeting the long-term requirements of the 
Canadian public. 
 
Although long-term export licensing is meant to en sure a level playing field between Canadian and 
foreign consumers with regard to consumption of Canada's oil resources, could Canada please give 
details of what this “due consideration” and open deliberation process actually consists of?  
Furthermore, how are these restrictions prevented from hampering fair competition? 
 
Question 10:  (paragraph 67 of page 101) 
 
The Report tells us that the NEB may also regulate export prices for oil and gas, but that, according to 
the authorities, this has rarely happened a nd requires action by the Federal Government. 
 
Does the Canadian government still have the intenti on of keeping these regulations in place?  In 
addition, how is such administrative supervision prevented from distorting the market competition 
mechanism? 
 
Question 11:  (paragraph 74 of page 102) 
 Electricity generation falls within the jurisdiction of the provinces, and some provinces are undergoing 
liberalization and deregulation reform.  In the el ectricity sector, competition and federal involvement 
varies between provinces. 
 
We would appreciate further clarification of the Fe deral Government’s attitude  towards these reforms, 
and we would like to know whether any overall poli cy guidelines have been formulated?  In addition, 
how does the federal regulatory body, e.g. the NEB, coordinate inter-provincial operations for both the 
deregulated and regulated markets in these provinces? 
 (5) TELECOMMUNICATION AN D BROADCASTING SERVICES 
 
Question 12:  (paragraph 109 of page 109) 
 
As indicated, Spectrum licences for wireless ope rations are granted by Industry Canada. 
 Could Canada please clarify whether the limit on fo reign direct investment in wireless services is the 
same as that for facilities-based services, with a combined maximum of 46.7% of voting shares?  Is 
there any other restriction applying to foreign investment in wireless services? 
 
(6) FINANCIAL SERVICES  Question 13:  (paragraph 136 of page 115, and paragraph 146 of page 117) 
 
As indicated in the Report, deposits in full-servi ce branches are not covered by deposit insurance and 
full-service branches of foreign banks are not eligible  for membership of the Canada Deposit Insurance 
Corporation (CDIC). WT/TPR/M/179/Add.1 
Page 34  
 
Could Canada please explain the reason why branch es of foreign banks are denied CIDC membership 
and would it consider removing such restriction? 
 
Question 14:  (paragraph 136 of page 115, and paragraph 146 of page 117) 
 
We have noted also that full-service branches of foreign banks may take deposits of C$150,000 or 
more and that all banks taking de posits of less than C$150,000 must be members of the Canada 
Deposit Insurance Corporation (CDIC).  Howeve r, as mentioned above, full-service branches of 
foreign banks are not eligible for CDIC membersh ip, which effectively excludes them from taking 
deposits of less than C$150,000. 
 
Would Canada kindly explain the rationale behind th ese regulations and will it consider removing such 
restrictions on foreign bank branches?  
Question 15:  
It is understood that some local governments do not recognize guarantees or L/Cs issued by authorized 
foreign banks for their customers. 
 
In the interests of enhancing the transparency of relat ed restrictions, standards or decisions made by 
local governments, would Canada consider granting equal treatment to both domestic and foreign 
banks in this respect? 
 
Question 16: 
 There are many sectors in Canada’s economy, such as  energy, mining, air tran sport, book publishing 
and distribution, periodicals publishing, and tele communications, in which foreign ownership is 
restricted. 
 
Does Canada have any plans to lift or loosen these rest rictions in order to promote foreign investment 
while at the same time enhancing domestic competitiveness? 
 
Additional Questions from the Separate Cust oms Territory of Taiwan, Penghu, Kinmen and 
Matsu  
 
Report by the Secretariat (WT/TPR/S/179)
 
 
II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
(1) OVERVIEW 
 
Question 1:  (paragraph 2 of page 11) 
 
We note that, in addition to its multilateral track, Canada pursues regional and bilateral preferential 
trade initiatives.  We understand, for example, that  Free Trade Agreement (FTA) negotiations are now 
being conducted with a number of Asian countries, such as Singapore and Korea.  Given our own close 
economic ties with Canada (currently  its eighth largest trading partne r and export market - counting the 
EC as one), it occurs to us that our dynamic econom y might also appeal to Canada as a sound basis for 
developing an even closer economic partnership, or an FTA .  We believe there is potential for our trade 
negotiators to come up with something more in this direction that could be to our mutual advantage. 
 Could Canada please inform us of the criteria it uses to choose potential FTA partners and whether it 
has plans to launch any new FTA  negotiations in 2007 with other countries in the Asia region? 
  WT/TPR/M/179/Add.1 
 Page 35 
 
 
Question 2:  (paragraph 31 of page 17) 
 
As indicated, there are 22 bilateral investment agreem ents in force between Canada and other countries.  
We notice that not all of the 22 agreements are part  of FTA agreements and that in Canada’s GATS 
commitments there is MFN exemption on the arbitr ation procedure of investor/state investment 
disputes for all services sectors. 
 
When the bilateral investment ag reement is not part of an FTA, do es Canada provide better market 
access for services investments than that provided fo r in its commitment in the GATS?  If so, we 
wonder how this complies with Canada’s GATS obligations? 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(2) MEASURES DIRECTLY AFFECTING IMPORTS 
(iv) Tariffs  Question 3:  (paragraph 46 of page 33) 
 
Regarding the General Preferential Tariff (GPT), the Secretariat’s Report states that, since the last Review in 2003, Mongolia and Oman have been  added, while ten new EC Member States were 
removed from the list of beneficiaries.  Could Canada please elaborate further on the criteri a used and the procedures followed in the process 
of adding or removing GPT beneficiaries?  
 
(4) MANUFACTURING  Question 4:  (paragraph 89 of page 105) 
 
It is noted that a number of tariff remission schemes pe rtaining to imports of textiles and clothing are in 
operation.  The Canadian General Preferential Tariff (GPT) Programme, for example, accords preferential and differential treatment to Members of the WTO.  As we understand it, such products 
from a Least-Developed Country (LDC) can enjoy ta riff-free preference when entering Canada if they 
are made from yarn or fabric from a GPT beneficiary. 
 Because we have not been granted designated be neficiary status under the GPT programme, while 
other WTO Members such as Korea and Hong Kong that  are at a similar stage of development to 
ourselves are accorded such preferential treatment, our exports to LDCs are affected. 
 
We have some serious concerns in this respect.  In its Report “European Communities - Conditions for 
the Granting of Tariff Preferences to Developing Coun tries”, the Appellate Body concluded that “...the 
term ‘non-discriminatory’…does not prohibit deve loped-country Members from granting different 
tariffs to products origina ting in different GSP beneficiaries, ...” and “In granting such differential tariff 
treatment, however, preference-granting countries are required, by virtue of the term ‘non-
discriminatory’, to ensure that identical treatment is available to all similarly-situated GSP 
beneficiaries, that is, to all GSP beneficiaries that have the ‘development, financial and trade needs’ to 
which the treatment in question is intended to  respond (emphasis added, see paragraph 173 of 
WT/DS246/AB/R).”  In light of the above, we respectfully request that  Canada grant us designated beneficiary status under 
the GPT programme, in due recognition of the principle of non-discrimination. 
 WT/TPR/M/179/Add.1 
Page 36  
 
IV. TRADE POLICY BY SECTOR 
(5) TELECOMMUNICATION AN D BROADCASTING SERVICES 
(ii) Institutional and legal framework 
(b) Broadcasting 
 
Question:  (paragraph 116 of page 111) 
 
As indicated in the report, foreign ownershi p of broadcasting programming undertakings and 
broadcasting distribution undertakings is limited in  Canada to 20% of an operating company and 33.3% 
of a holding company.  As there is a sizeable population in Canada with  an Asian background, the programming covering this 
market is important for us and others in our region.   Therefore, we would appreciate knowing whether 
Canada plans further liberalization in this sect or to remove the above-mentioned restrictions.  
 
COLOMBIA  
 
WT/TPR/S/179 
 
CAPITULO II.  RÉGIMEN DE POLÍTICA COMERCIAL:  MARCO Y OBJETIVOS 
 1. Visión General 
 
Se comenta en el Informe de la Secretaría que el régimen de política en materia de comercio e 
inversiones de Canadá no ha camb iado de manera significativa desde el año 2003.  Está basado en 
competencias federales y provinciales compartidas,  y entraña consultas periódicas entre el Gobierno 
Federal, las provincias, la industria, entidades no gubernamentales y grupos de intereses públicos, y el 
público en general.  Comprende también un acuer do para identificar y reducir los obstáculos 
interprovinciales al comercio y la inversión.  Ca nadá ha afirmado que sus pe rspectivas de crecimiento 
dependen de la apertura de los mercados mundiales  y de un entorno comercial estable, previsible y 
transparente. 
 
1. ¿Las competencias federales y provinciales tienen una misma perspectiva respecto del régimen de 
política de comercio e inversiones de Canadá o exist en discrepancias en materia de inversión 
extranjera? 
 
2. ¿Existen exigencias o restricciones a nivel pr ovincial que se apliquen a la inversión extranjera a 
pesar de que no existan a nivel federal? 
 
En el párrafo 3, se comenta que Canadá mantiene  una política de trato nacional para la inversión 
extranjera directa, sujeta a restricciones específicas por sectores en relación con la pesca, minería y 
energía, transporte aéreo, telecomunicaciones y actividades culturales.  Además, las adquisiciones 
extranjeras que superen un determinado límite están  sujetas a un examen con objeto de asegurar que 
tengan como resultado un "benefic io neto" para el Canadá. 
 
3. ¿Cuál es el monto límite de adquisición extranjero? 
 
4. ¿En qué consiste el examen para asegurar el “beneficio neto” de la inversión extranjera en el 
Canadá?  5. ¿Dicho examen aplica unos criterios objetivos  para estimar el “beneficio neto”? ¿En caso 
afirmativo, cuáles son esos criterios? 
  WT/TPR/M/179/Add.1 
 Page 37 
 
 
6. ¿Cuál es la consecuencia de que dichos adqui siciones extranjeras no resulten en un “beneficio 
neto” según el examen? 
 
2. Marco Jurídico General 
 Se menciona en el párrafo 8 que la facultad de negociar y concertar tratados internacionales 
corresponde exclusivamente al poder ejecutivo federal.   Los tratados intern acionales no se aplican 
automáticamente con arreglo a la legislación canadie nse: Las leyes en materia de aplicación pueden ser 
necesarias cuando las disposiciones del derecho interno son incompatibles con las obligaciones 
internacionales del Canadá.  La responsabilidad de  aplicar las disposiciones de los tratados 
internacionales puede recaer en el Gobierno Federal o en los gobiernos provinciales en función de la 
división de poderes establecida en la Constitución.  
7. ¿Cual es la función y competencia del poder legisla tivo y jurisdiccional en el trámite de negociación 
y ratificación de tratados internacional es (especialmente los comerciales). 
 
8. ¿En caso que las disposiciones de derecho interno sean incompatibles con las obligaciones 
derivadas de un Acuerdo Int ernacional de Inversión, ¿cuánt o es el tiempo estimado para la 
implementación y aplicación de las disposiciones de los tratados inter nacionales por parte del 
Gobierno Federal y por parte de las provincias?  
9. ¿Que ingerencia tiene las Provincias en la  formulación de la política comercial del Canadá? 
 10. ¿Cuales son las diferencias en tre las empresas a nivel federal y las empresas con jurisdicción 
provincial?  
11. ¿Existe en el Canadá una jurisdicción laboral y como operaría en el ámbito federal? 
 12. ¿Cada Provincia tiene una legislación laboral o existe una federal de aplicación para todas las 
provincias? 
 
3. Formulación y objetivos de la política comercial 
 En el párrafo16 se reconoce la existencia de impor tantes diferencias en las políticas y prácticas en 
materia de comercio e inversiones entre el Gobier no federal y los gobiernos provinciales, y entre las 
provincias. Se menciona que el Acuerdo de Come rcio Interno (AIT) tiene por objeto "reducir y 
eliminar, en la medida de lo posible, los obstácu los a la libre circulación de personas, mercancías, 
servicios e inversiones dentro del Canadá, y establece r un mercado interno abierto, eficiente y estable". 
El AIT entró en vigor en 1995.  Todas las provinc ias y territorios excepto Nunavut son signatarios. 
 
13. ¿Qué sucede con Nunavut? No le son exi gibles las decisiones sobre inversiones del AIT? 
 14. ¿Cuáles son las principales diferencias en la s políticas y prácticas en materia de comercio e 
inversión? ¿Hay algunas provincias que tengan mayo res barreras a la inversión? En caso afirmativo 
cuáles serían? 
 
4. Régimen de inversiones extranjeras 
 Según el párrafo 21, la Ley de I nversiones del Canadá rige el es tablecimiento de nuevas empresas 
extranjeras y las adquisiciones de empresas canadiens es.  También hay leyes federales y provinciales 
que rigen la inversión en sectores particulares.  
15. ¿Existen incongruencias entre la ley de Inversi ones del Canadá y leyes federales y provinciales? Si 
la respuesta es afirmativa, ¿En qué sectores? WT/TPR/M/179/Add.1 
Page 38  
 
Menciona el párrafo 24 que las inversiones en de terminados sectores culturales que se sitúan por 
debajo de los niveles mínimos sujetos a examen pueden sin embargo ser examinadas si el Gobernador en Consejo considera que un examen sería de "interés público" y emite un decreto a ese efecto por recomendación del titular del Ministerio del Patrimon io Nacional del Canadá.  Dentro de los 21 días 
contados a partir de la notificación, debe inform arse al inversor interesado de que tendrá lugar un 
examen.  Los sectores culturales sujetos a esta dis posición se enumeran en la Lista IV de las 
Reglamentaciones en materia de inversión del Canadá. 
 
16. ¿Cuáles son los criterios para determinar el “interés público” para la realización del examen? 
 Se indica en el párrafo 28 que en varias provincias y el Yukón está reglamentada la propiedad de tierras 
por extranjeros, principalmente con respecto a las tierras rústicas agrícolas y de recreo.  Según las 
autoridades canadienses, las excepciones a los reglam entos provinciales de la propiedad extranjera son 
habituales.  Los gobiernos provinciales y fede ral pueden imponer limitaciones a la participación 
extranjera en la privatización.   
 
17. ¿Cuáles son esas excepciones de los reglamentos pr ovinciales y a nivel federal sobre la propiedad 
extranjera?  18. ¿Qué porcentaje de la propiedad en C anadá está restringida para la inversión extranjera? 
 
CAPITULO III. POLITICAS COMERCIALE POR MEDIDAS  1. Medidas que afectan las importaciones  a) Procedimientos para las importaciones 
 El documento de la Secretaría ofrece información amplia y precisa sobre las medidas que afectan a las 
importaciones relacionadas con procedimientos aduane ros.  Nuestras autoridades desean sin embargo, 
formular algunas preguntas de carácter general con el fin de contar con información adicional del 
sistema aduanero de Canadá.   19. ¿En qué consiste el mecanismo denominado  autoevaluación en aduanas? ¿Cuáles son los 
beneficios que representa este mecanismo par a los operadores de comercio exterior? 
 
20. ¿La aduana permite que los importadores dispongan  de las mercancías extranjeras en el lugar de 
arribo, sin el pago de los impuestos de importación y sin perjuicio de la determinación final de los 
impuestos por parte de la aduana,  previa constitución de una garantí a? de ser permitido, explicar el 
procedimiento y momentos de presentación de la declaración de importaci ón, documentos soportes y 
pago efectivo de los impuestos garantizados. 
 
21. ¿La administración aduanera del Canadá exi ge  la utilización de agentes de aduanas 
(intermediación) para la realización de las opera ciones de importación, exportación o destinación 
aduanera de una mercancía?  Explicar 
 22. ¿Cuál es el tratamiento brindado a los envíos  de entrega rápida? ¿Existe la posibilidad de 
exonerar del pago de los impuestos y derechos de importación a los bienes despachados como envíos 
de entrega rápida? 
 
b) Medidas comerciales especiales 
 
En el párrafo 75, se señala que Canadá administra  un sistema antidumping prospectivo por el que se 
informa a los exportadores de los valores normales de los productos que exportan al Canadá, de manera  WT/TPR/M/179/Add.1 
 Page 39 
 
 
que si las ventas futuras se efectúan a niveles de precios iguales o superiores al valor normal del producto, no se establecen derechos.  
23. Puede entenderse que esta es la forma que Canadá utiliza para aplicar  derechos antidumping 
provisionales o definitivos? Cómo determina C anadá la cuantía del derecho antidumping o 
compensatorio, aplicable a las mercancías con precios inferiores al “valor normal”? 
 
En los párrafos 76 y 87, se informa que Canadá pu ede iniciar simultáneamente investigaciones en 
materia de antidumping y medidas compensatorias, y los productos pueden quedar sujetos a derechos 
antidumping, medidas compensatorias y salvaguardias al mismo tiempo. 
 
24. ¿En estos casos, como aborda Canadá el análisis  de relación causal, y que metodología utiliza 
para atribuir simultáneamente a pr ácticas de dumping, s ubsidios, o incremento de importaciones, el 
daño causado sobre un mismo producto?  
 
25. ¿Cómo determina Canadá, simultáneamente y sobre un mismo producto la existencia de daño 
grave que se exige para la aplicación de medidas  de salvaguardias y daño importante que se exige 
para la aplicación de derechos antidumping o compensatorios?. Teniendo en cuenta que esta 
combinación de medidas pueden dar lugar a que se superen los niveles necesarios para corregir el 
daño en la rama de producción nacional, cual  es la metodología utilizada por Canadá para imponer 
un correctivo justo? 
 
c) Reglamentos técnicos, evaluación de la conformidad y normas 
 
Según el párrafo 94, la Secretaría del Consejo del Tesoro supervisa la gestión y coordinación de la 
política federal sobre reglamentos técnicos y de ot ro tipo.  A su vez la Secretaría de Asuntos 
Normativos de la Secretaría del Consejo del Teso ro vela porque los reglamentos propuestos por los 
departamentos federales se ajusten a la política en materia de reglamentación. 
 
26. ¿Qué sucede en el caso de los reglament os expedidos por los gobiernos provinciales y 
territoriales? 
 El Informe de la Secretaría, en el párrafo 96 plant ea que en general, los reglamentos provinciales no se 
notifican a la OMC porque no tie nen repercusión internacional. 
 
27. ¿Cuál es el criterio usado por Canadá para det erminar que un reglamento no tiene repercusión 
internacional? ¿Podrían suministrar algunos ejem plos? ¿Alguno de los reglamentos provinciales 
afecta a productos importados?   
En el párrafo 101, se menciona que “A petición de un a autoridad federal, el Consejo del Tesoro podrá 
eximir del requisito de publicación previa o abre viar el período de formulación de observaciones”. 
 
28. ¿Esta facultad que posee el Consejo del Tesoro es discrecional o está reglamentada? 
 
29. ¿Canadá publica las observaciones que formulan lo s interesados sobre un proyecto de reglamento 
técnico? 
 
El párrafo 114 establece que el  Consejo de No rmalización del Canadá (S CC) está encargado de 
examinar las normas presentadas por organizaciones de elaboración de normas y, tras la realización de 
las modificaciones que hayan podido recomendarse, de aprobarlas como Normas Nacionales del Canadá.  Esas normas deben incorporar normas internacionales "apropiadas" y normas nacionales 
"pertinentes", o ser compatibles con ellas, y deben ponerse a disposición del público, para su examen, 
durante su elaboración. 
 WT/TPR/M/179/Add.1 
Page 40  
 
30. ¿Cuáles son los criterios para considerar una norma “apropiada” o “pertinente”? 
 
31. ¿Pudiera Canadá brindar información sobre el funcionamiento del Programa “Export Alert”? 
 32. ¿Tiene previsto Canadá elaborar un inventario de reglamentos técnicos vigentes, expedidos por los 
gobiernos federales, provinciales y territoriales?  
2. Otras medidas que afectan la producción y el comercio 
 a) Contratación pública 
 El párrafo 219 plantea que el Gobierno Federal utili za la contratación para ap oyar objetivos nacionales 
como el desarrollo industrial y regional, el desarrollo económico de la población autóctona, el medio ambiente y otros objetivos socioeconómicos y que c on tal propósito, “exige que se examinen todos los 
contratos federales por valor superior a 2 mill ones de dólares canadienses con miras a posibles 
beneficios regionales e industriales”. 
 
33. Agradeceríamos ampliar esta información con miras a conocer cómo se realiza esta evaluación, 
qué factores se tienen en cuenta y con qué propósito se usan las conclusiones. 
 
En el párrafo 220 se comenta que Canadá es parte de l Acuerdo de la OMC sobre Contratación Pública 
(ACP) desde el 1º de enero de 1996.  Por su parte, en  el párrafo la Secretaría menciona que la última 
notificación del Canadá de estadísticas anuales, de conformidad con el párrafo 5 del artículo XIX del 
Acuerdo de la OMC sobre Contratación P ública, se realizó en octubre de 1998. 
 
34. La disponibilidad de estadístic as sobre la contratación pública es un tema muy importante para los 
países que quieran evaluar la conveniencia de adherir al Acuerdo sobre la Contratación Pública de la 
OMC. Sería de gran utilidad que Canadá, y los país es miembros de este acuerdo que tienen un retraso 
en la notificación de las estadísticas,  suminist raran la información correspondiente para disponer de 
una herramienta actualizada que permita tomar una decisión sobre la adhesión al Acuerdo. 
 
b) Propiedad Intelectual 
 
Preguntas generales: 
 
35. ¿Existe en Canadá una Política Nacional  en materia de Propiedad Intelectual? 
36. ¿Existe en el Canadá un régimen legal aplicabl e para el acceso a los recursos genéticos? Si existe, 
se relaciona el mismo con el sistema de propiedad intelectual?  
En el párrafo 268 se señala que las autoridades indican que los productos fabricados en otra 
jurisdicción por el mismo propietario de la marca de  fábrica o de comercio que en el Canadá no se 
consideran productos infractores simplemente porque ha yan llegado al Canadá y el propietario de la 
marca de fábrica o de comercio no desee que se distribuy an en el país.  Sin embargo, pueden impedirse 
las importaciones paralelas mediante otros mecanis mos, entre ellos prescripciones en materia de 
derechos contractuales y normas diferentes.  En lo que  se refiere a las patentes, la situación es similar a 
la de las marcas de fábrica o de comercio.  Se prohíben las importaciones de libros sin el 
consentimiento del titular del derecho de autor, a unque existen ciertas excepciones a esa disposición. 
 37. ¿Qué validez tienen en Canadá las cláusulas contractuales de exclusividad territorial utilizadas 
como medios para impedir las importaciones paralelas  en contratos de distribución o suministro? Se 
consideran estas cláusulas como contra rias a la libre competencia económica? 
 
El párrafo 269 menciona que los servi cios de aduanas canadienses no están  facultados para confiscar de 
oficio las importaciones infractoras.  En virtud de la Ley de Derecho de Autor y de la Ley de Marcas de  WT/TPR/M/179/Add.1 
 Page 41 
 
 
Fábrica o de Comercio, los funcionarios de aduanas só lo están autorizados a retener las mercancías si el 
titular del derecho de propiedad intelectual ha  obtenido una orden judicial a tales efectos. 
 
38.¿Podría Canadá explicar el procedimiento a seguir ante las autoridades judiciales y aduaneras por 
parte de un titular que considere que mercancía in fractora de sus derechos hace transito por la 
frontera?  
Según el párrafo 259, en octubre de 2006 se modificó  el Reglamento sobre Medicamentos Patentados 
(Declaración de conformidad) (cuadr o III.16) para facilitar a las empresas de medicamentos genéricos 
prever cuándo podrían introducir en el mercado una versión de inferior costo de un medicamento 
innovador patentado.  Según las autoridades, esas m odificaciones acelerarán la entrada en el mercado 
de medicamentos genéricos una vez expiren las patent es pertinentes.  También en octubre de 2006, se 
introdujeron modificaciones en las disposicion es sobre protección de datos contenidas en el 
Reglamento de Productos Alimenticios y Farmacéuticos , con el fin de dar a lo s medicamentos nuevos e 
innovadores un período garantizado de ocho años como mínimo de exclusividad del mercado. 
 
39. ¿Cuáles son las razones que motivaron al G obierno de Canadá a modificar su reglamentación 
nacional en materia de datos de prueba farma céuticos para brindar protección por un período de 
8 años? 
 
CAPITULO IV. POLITICAS COMERCIALES POR SECTORES 
 
1. Agricultura  
Indica la Secretaría en el párrafo 11 que el Gobi erno federal y los gobiernos provinciales en Canadá 
firmaron el Acuerdo Marco de Política Agrícola, con el fin de fortalecer la rentabilidad del sector de los 
productos agroalimentarios a través de programas y servicios.  
 
40. ¿Podría Canadá explicar con mayor detalle en  qué consisten los programas y servicios 
establecidos en este Acuerdo? 
 
En el párrafo 16 se indica que existen 21 contingent es arancelarios, que se aplican a las importaciones 
de productos sujetos al sistema de oferta regulada. 
 
41. ¿Actualmente para cuáles productos se establ ecen contingentes?, ¿cuál es su esquema de 
asignación y administración?, y ¿cómo f unciona el sistema de oferta regulada? 
 La Secretaría señala que Canadá en su lista de compromisos de la Ronda Uruguay, para unos pocos 
productos especificó los tipos de los derechos aplica dos dentro y fuera del contingente, pero no los 
volúmenes de esos contingentes.  
42. ¿Podría Canadá explicar cómo se establecen las c antidades de los contingentes? ¿De qué manera 
estos volúmenes asignados resultan compatibles con lo  establecido en el Acuerdo Sobre la Agricultura 
en materia de acceso a mercados?  
43. ¿En qué consiste el conti ngente de distribución del mercado? 
 44. Sírvase indicar las barreras no arancelar ias que aplica actualmente para productos 
agropecuarios.  
En el párrafo 27 se informa sobre la Ley de Gr anos, la Ley de Transporte, y sus respectivas 
modificaciones.  WT/TPR/M/179/Add.1 
Page 42  
 
45. ¿Puede Canadá explicar o proporcionar mayores de talles sobre estas Leyes, así como en la 
modificación realizada?  
 
46. ¿Cuál es el manejo, operación y mercadeo desa rrollado por las Empresas Comerciales del Estado 
en trigo, cebada y lácteos?. 
 En el párrafo 26 se indica que el Reglamento sobre Tramitación de Licencias y Arbitraje, prohíbe la 
venta en consignación de frutas y hortalizas frescas im portadas, así como las ventas interprovinciales 
en consignación.   47. ¿Cuál es el manejo de las políticas aplicables a las ventas en consignación en 
las provincias canadienses, y a las interprovinciales en consignación? 
 
48. De acuerdo con la notificación sobre ayuda inter na para el año 2000, ¿podr ía Canadá señalar si 
aún continúan los programas orientados a la rehab ilitación agrícola de las praderas, la ayuda para 
las habas de soja y la carne de porcino, el estableci miento de precios al productor en los sectores de 
las aves de corral y los huevos, y los precios de la mantequilla y de la leche desnatada en polvo 
producidas con ciertas clases de leche? De mant enerse, ¿podría Canadá indicar en qué consisten 
dichos programas y qué ti po de ayudas incluyen?  
 
49. Indique cuál es la política que tiene Canadá para  el sector lácteo y sus derivados. ¿Cómo opera y 
quienes integran el Comité Canadiense de Regulaci ón de la Oferta de Leche (CMSMC)? ¿En qué 
consiste el Plan Nacional de Com ercialización de la Leche y los acuerdos federal - provincial que 
regulan la oferta de leche?. ¿Cómo este tipo de pr ogramas son compatibles con el Acuerdo sobre 
Subvenciones y Medidas Compensatorias y con el Acuerdo sobre la Agricultura de la OMC?  
 En el párrafo 33, la Secretaría señala que los precios de las aves de corral se negocian entre las juntas 
provinciales de productores y las empresas de transfor mación primaria de aves de corral sobre la base 
de la fórmula del costo de la producción.  
50.  ¿Cómo se determina la formula del costo de producción? 
 El párrafo 34, indica que existen programas de ay uda a los ingresos conforme al Marco de Política 
Agrícola tales como el Programa canadiense de est abilización de los ingresos agrícolas (CAIS), y el 
Seguro de Producción. Del mismo modo, menciona que existen programas de apoyo a través de 
garantías estatales y pagos excepcionales.   51. Señale por favor los productos que actualmente ha cen parte de estos programas. ¿De qué manera 
este tipo de programas son compatibles con el Acuerdo sobre la Agricultura de la OMC? 
 
El informe de la Secretaría señala que el Gobier no de Canadá mantiene los siguientes programas de 
ayuda interna: Ley de Comercialización de los Pr oductos Agropecuarios (APMA), Programa de Pagos 
Anticipados (APP), Programa de Agrupación de Pr ecios, Programa operado conforme a la Ley de 
préstamos destinados a la mejora agraria y a las cooperativas de comercialización (FIMCLA), 
Programa Transitorio de Apoyo a la Industria (TISP)  y Programa de Pagos relacionados con los Granos 
y las Semillas Oleaginosas (GOPP).   
52. Indique en qué compartimento se ubican este tipo de programas y explique lo s criterios tenidos en 
cuenta para su clasificación, según el Acu erdo sobre la Agricultura de la OMC. 
 
53. Por favor provea mayores deta lles sobre los subsidios a las ex portaciones agrícolas otorgadas por 
Canadá, en particular con el manejo  de precios en lácteos. ¿Para estos productos, cómo operan los 
programas de crédito y garantías subsidiados por el Estado canadiense? 
  WT/TPR/M/179/Add.1 
 Page 43 
 
 
2. Servicios 
 a) Visión General 
 
Párrafo7. Se menciona que el se ctor financiero del Canadá está bien desarrollado y diversificado, 
y sus resultados han sido buenos.  El sector bancario  está abierto a la competencia extranjera, pero se 
aplican restricciones a la propiedad de los bancos n acionales y extranjeros.  Las compañías de seguros 
deben obtener una licencia en cada provincia en la que realizan negocios, lo que puede complicar el 
acceso al mercado de los proveedores extranjeros.  54. Existen unos requisitos estándar que aplican por i gual en todas las provincias para las compañías 
de seguros que solicitan una licencia para realizar sus negocios o los requisitos son diferentes según 
provincia?  55. La licencia es exigida solamente a las compañías de seguros extranjeras o también a las 
nacionales?  
Párrafo 8. Se indica que en el sector del transporte marítimo, el cabotaje está reservado a los buques de pabellón canadiense, aunque se permite el acceso de buques extranjeros, si no está 
disponible ningún buque matriculado en Canadá que sea adecuado.  Con respecto al sector del 
transporte aéreo, el crecimiento de las líneas aére as de bajo costo trajo consigo el aumento de la 
competencia.  Sin embargo, las líneas aéreas de propiedad extranjera no pueden prestar servicios de 
cabotaje y la propiedad extranjera en las líneas aé reas canadienses se limita al 25 por ciento de las 
acciones con derecho a voto, complementada por exámen es de control de facto, de carácter flexible. 
 
56. En qué consisten los exámenes de control de  facto que son aplicados a las líneas aéreas 
canadienses que tienen participaci ón extranjera en su propiedad? 
 
Párrafo 9. Se menciona que prácticamente t odas las profesiones están reglamentadas a nivel 
provincial o territorial, y se fortalecieron las medi das encaminadas a facilita r la movilidad de las 
profesiones entre las provincias y los territorios.  Aunque, en algunos casos, siguen aplicándose prescripciones en materia de ciudadanía y resi dencia, se han suprimido algunos obstáculos. 
 
57. ¿Podría Canadá dar ejemplos de los obstáculos que se han suprimido en materia de requisitos de 
ciudadanía y residencia para el ejercicio de la pr ofesión en ese país? ¿Cuáles son los obstáculos que 
permanecen? 
 
b) Servicios de telecomunicaciones y radiodifusión 
 
58. Dado que en el Informe de la Secretaría no se  hace referencia al tema de comercio electrónico, 
Colombia agradece a Canadá el suministro de info rmación sobre la  política en esta materia. 
 
En el párrafo100 se ofrece información completa sobre estadísticas del año 2005, 
correspondientes a ingresos totales de los servici os de telecomunicaciones (a excepción de la 
radiodifusión), que se elevaron a 34.500 millones de  dólares canadienses, lo que representa un aumento 
del 3,5 por ciento con respecto al año anterior;  la mayor parte de este aumento se debe al crecimiento de los ingresos de los servicios de Internet de banda ancha e inalámbricos. También se allega 
información sobre los servicios inalámbricos que son el principal sector del mercado de las 
telecomunicaciones del Canadá y sobre cuotas de mercado. 
 
59. Todas las empresas titulares son operadores públicos? Se consideran las empresas titulares 
proveedores importantes?  WT/TPR/M/179/Add.1 
Page 44  
 
60. En qué consisten las operaciones extraterritori ales? Tienen estas operaciones alguna relación con 
las obligaciones de servicio universal? 
 
Según el párrafo 102, los compromisos sobre telecomunicaciones asumidos por el Canadá en el marco del Cuarto Protocolo anexo al AGCS abarcan pr ácticamente todos los servicios.  En la lista de 
compromisos específicos del Canadá se excluyen los servicios regulados por la Broadcasting Act (Ley 
de Radiodifusión) , que incluye los servicios de telecomunicaciones suministrados para la transmisión de programas cuya recepción por el público es dir ecta (esto es, servicios de televisión de difusión 
directa a domicilio y de radiodifusión directa por satélite.   No se imponen restricciones a los servicios mejorados o de valor añadido. 
 
61. ¿Cuál es le régimen aplicable a los prestadores de servicios de valor añadido? 
 
El párrafo 108 menciona que los revendedores y lo s proveedores de servicios de telecomunicaciones 
locales y de larga distancia que poseen las instal aciones sólo tienen que registrarse en la CCRT, 
mientras que los proveedores de servicios internacional es necesitan una licencia.  Para prestar servicios 
de telefonía local, las empresas tienen que registrarse en la CCRT como empresa competitiva de servicios locales (ECSL).  
62. ¿Cuál es la diferencia entre ECSL y ESLT? 
63. ¿Se permite la reventa de servicios por parte  de proveedores que no poseen instalaciones? 
64. ¿Cuáles son las diferencias en términos de tiem po, costos administrativos y otros costos entre el 
registro en la CCRT y adquirir una licencia?  65. ¿Cuál es la racionalidad para exigir licencia sólo  a los proveedores de servicios internacionales? 
66. ¿Cómo se define a los proveedores de servicios internacionales?  
En el párrafo 111 se indica que la CCRT exige que  las empresas de servici os locales titulares (ESLT) 
proporcionen a los competidores el acceso desagrupa do a instalaciones esenciales (incluido el acceso a 
los bucles locales) a las tarifas obligatorias.  La CCRT también exige a las ESLT que proporcionen 
interconexión a las empresas de la competencia. La C CRT obliga al reparto por igual de los costos para 
el establecimiento de circuitos troncales de interconexión en cada re gión de interconexión 
predeterminada, y adopta un enfoque de facturación- conservación para compensar la terminación de 
llamadas. 
 
67. ¿En qué consiste el enfoque de facturaci ón-conservación para compensar la terminación de 
llamadas?  
68. ¿Cuál es el régimen de interconexión entre redes privadas?  
De acuerdo con el párrafo 114, los ser vicios de voz sobre el protocolo In ternet (VoIP) sólo los regula la 
CCRT cuando se suministran y usan como servicios de  telefonía local.  A fin de impedir que las ESLT 
abusen de su poder de mercado, la CCRT les exig e que presenten para esos servicios tarifas que 
dependan del acceso a la propia red del provee dor.  Las ESLT también tienen limitado hacer 
promoción del servicio a anteriores clientes de confor midad con todas las prescripciones reglamentarias 
existentes. Los servicios VoIP de ordenador a ordenador no están sujetos a reglamentación. 
 
69. ¿Cuál es el régimen aplicable a los servicios de telefonía local prestados sobre el protocolo 
Internet (VoIP)? 
 
c) Servicios financieros 
 
Menciona el párrafo 129 que entre las principales ley es financieras federales de l Canadá figuran la Ley 
de Banca, la Ley sobre Empresas Fiduciarias y de Préstamos, Ley sobre las Empresas de Seguros y la 
Ley de Cooperativas de Crédito.  La legislación fi nanciera del Canadá se revisa cada cinco años.   WT/TPR/M/179/Add.1 
 Page 45 
 
 
Como resultado del examen de 2001, se adoptó nueva legislación financiera.  En el contexto del 
examen más reciente, en noviembre de 2006 se presentó ante el Parlamento un proyecto de ley.  
70. ¿Cuáles son las razones que exp lican la adopción de nueva legisl ación financiera como resultado 
del Examen de Política Comerci al efectuado en el año 2001? 
 
d) Servicios bancarios 
 
El párrafo 133 señala que aunque los servicios ban carios no están sujetos a limitaciones de suministro 
transfronterizo o consumo en el extranjero, los pr oveedores de servicios fina ncieros deben establecer 
una presencia comercial para solicitar el ejercicio de actividades en el Canadá. 
 
71. ¿El requisito de establecer una presencia comerc ial en Canadá para poder suministrar servicios 
financieros transfronterizos puede ser cumplido a tra vés de una oficina de representación o qué figura  
jurídica específica se exige? 
 
Se comenta en el párrafo 139 que con el  fin de  establecerse y operar en el Canadá, los bancos 
nacionales y las filiales de los bancos extranjeros de ben obtener una carta patente para su constitución y 
una orden de comienzo de funcionamiento.  Las cart as patentes de constitución las expide el Ministro 
de Hacienda previa recomendación del Superintende nte de Instituciones Financieras y según el párrafo 
140, con arreglo a la Ley de Banca, el Ministro de  Hacienda podrá tener en cuenta todos los factores 
pertinentes para determinar si emite las cartas patent es de constitución.  La Ley de Banca contiene una 
lista ilustrativa de tales factores pertinentes, uno de  los cuales es "el interés del sistema financiero 
canadiense".  
72. ¿En qué consiste el requisito de “carta pat ente” para la constitución de bancos en Canadá? 
 
73. ¿Al decir que las “cartas patente” son expedidas por el Ministerio de Hacienda previa recomendación del Superintendente de Instituciones Financieras, puede ello significar que la 
recomendación esté sujeta a pruebas de n ecesidad económica o a restricciones cuantitativas? 
 
BRAZIL 
 
WT/TPR/G/179 
 
(1) In Chapter II, paragraph 15, the Canadian Government states that "Canada seeks (...) 
substantial improvements in market access for ag ricultural and food pro ducts".  How does the 
continued support for the system of supply manage ment (as shown in Ministers Chuck Strahl and 
David Emerson's appearance before the Standi ng Committee on Agriculture and Agri-Food of the 
House of Commons on February 27th, 2006) rela te to that goal at the Doha negotiation? 
 (2) Under the heading "Bilateral Trade Initiatives" (Chapter II, paragraphs 65 to 72), the Canadian 
government outlines its priorities and intentions  regarding trade negotiations with some 
countries/groups of countries, including in Latin Am erica.  On this issue, the Brazilian Government 
would like to pose two questions:  2.1. No bilateral agreements have been signed by Canada since 2003.  Is it the result of a policy 
decision or something due to circum stances beyond Canada's control? 
 
2.2. In the pages mentioned above, no reference is made to Mercosur.  Is there any specific trade 
policy objective for such group of countries?  If so, please elaborate.  WT/TPR/M/179/Add.1 
Page 46  
 
(3) In Chapter II, paragraphs 76 and 77, the Ca nadian government lists countries with which it 
maintains or presently negotiates Foreign Investment  Protection Agreements (FIPAs).  Could Canada 
elaborate on the effectiveness of such agreemen ts in generating new FDI to and from Canada? 
 
WT/TPR/S/179 
 
(1) In Chapter II, paragraph 36 and table AII.2, it is  noted that Canada has not fulfilled obligations  
regarding notifications, including with regard to  state-trading enterprises (in this case, the last 
notification was made in 2002).  What are the reasons for non-notification?  
(2) In Chapter III, paragraph 128, the report addresses the recognition of disease-free regions in 
countries.  What are the perspectives of full impl ementation of SPS Agreemen t Article 6 in Canada? 
 (3) In Chapter III, paragraph 200, the report r ecalls that Technology Partnerships Canada (TPC) 
expired on December 31, 2006.  Can the Government  of Canada comment on plans it might have to 
replace such program with another program or mechanism? 
 (4) In Chapter IV, there is a reference to the Regional Aircraft Credit Facility (RACF), which is 
due to expire in March 2008.  Ca n the Government of Canada comme nt on plans it might have for the 
future of such program?"  ARGENTINA  
 
WT/TPR/S/179, INFORME DE LA SECRETARIA 
 
III:  POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
2)  Medidas que afectan directamente a las importaciones 
vii)  Medidas comerciales especiales Párrafos 93 al 115 (pp. 55 a 60): 
 
Teniendo en cuenta las obligaciones exigibles a los Miembros contenidas en los Artículos 3.5 y 7.5 y 
otros aplicables del OTC, ¿podría Canadá detallar los esfuerzos que realizó para evitar la diferencia de 
tratamiento que existe entre las disposiciones sobr e requisitos de certificación y etiquetado para la 
comercialización de productos orgánicos que aplican por separado Canadá y la provincia de Québec 
(los primeros, voluntarios y los segundos, obligatorios)? ¿Es posible esperar un cambio en estos requisitos que parecen tener el efecto de limitar la  libre circulación de bienes en el propio país y 
constituirse en un medio para desca lificar productos y proveedores?  
 
3)  Medidas que afectan directamente a las exportaciones 
ii)  Impuestos, cargas y gravámenes a la exportación Párrafos 144 a 146, páginas 67/68  
El 12 de septiembre de 2006 el Canadá y los Esta dos Unidos firmaron un acuerdo con respecto a las 
exportaciones de madera blanda canadiense, tras una di ferencia comercial de la rga data en relación con 
los derechos antidumping y compensatorios aplicados  por los Estados Unidos a las importaciones de 
madera blanda procedentes del Canadá.  Tales me didas habían sido objeto de impugnaciones en los 
tribunales estadounidenses en el marco del Entendimien to sobre Solución de Diferencias de la OMC y 
del capítulo 19 del TLCAN.  El Acuerdo entró en vigor el 12 de octubre de 2006, con modificaciones 
de las disposiciones relativas a la terminación de cierto litigio y al reembolso de los depósitos en 
concepto de derechos.  En el marco de ese acuer do, los Estados Unidos revocaron las órdenes de 
imposición de derechos antidum ping y de derechos compensatorios y reembolsaron más del 80 por 
ciento de los depósitos en concepto de derechos percibidos desde 2002.  Los exportadores canadienses 
de madera blanda pagarían un gravamen de export ación cuando el precio de referencia convenido para 
la madera sea igual o inferior a 355 dólares EE. UU. el millar de pies tablares.  Las regiones  WT/TPR/M/179/Add.1 
 Page 47 
 
 
canadienses abarcadas por el acuerdo (Columbia Britán ica, Alberta, Saskatchewan, Manitoba, Ontario 
y Québec) podrán elegir entre dos regímenes: un grav amen de exportación que va ría con el precio, o un 
gravamen de exportación menor y una limitación del volumen,  los que ta mbién variarían con el precio.  
El Gobierno del Canadá recaudará los ingresos en  concepto de gravámenes de exportación y los 
devolverá a las provincias sobre la base del origen de  la madera.  Los fondos pueden no revertir a las 
industrias de las que fueron recaudados. Se aplican algunas exenciones y exclusiones. 
 ¿Podría Canadá brindar mayores precisiones sobre el  funcionamiento del sistema de impuestos a la 
exportación para madera blanda?   
¿Podría indicar Canadá si dicho sistema se apli ca a todas las exportaciones de madera blanda o 
únicamente aquellas que tienen como des tino Estados Unidos de Norteamérica? 
 Asimismo, ¿qué mecanismos utiliza Canadá para devol ver los ingresos en concepto de gravámenes de 
exportación a las provincias sobre la base del origen  de la madera? ¿Qué mé todo utiliza Canadá para 
establecer el origen de la madera? 
 
4)  Medidas que afectan a la  producción y al comercio 
ii)  Incentivos y otras medidas de ayuda a las empresas Párrafos 193 –194 (pp. 83-84) y párrafos 199 - 200 (pp. 85 y 86): 
 ¿Podría Canadá suministrar una lista actualizada,  global y anualizada de los pagos, desgravaciones 
fiscales, tarifas especiales y facilidades crediticias que en la actualidad se otorgan a favor de la 
producción agrícola, agroindustrial e industrial (i ncluido el tratamiento aplicable a las nuevas 
tecnologías)? ¿Podría Canadá incluir en esa info rmación los datos específicos desagregados de las 
políticas federales y provinciales?  III.  POLÍTICAS COMERCIALES, POR MEDIDAS IV.  POLÍTICAS COMERCIALES POR SECTORES Párrafo 1, página 31 y párrafos  3, página 109 y 47 a 52, páginas 122/123  
En el párrafo 1 citado, se indica que durante el período objeto del examen, no se han producido 
cambios en las empresas comerciales del Estado, entre ellas la Junta Canadiense del Trigo. No 
obstante, de acuerdo con lo señalado en los párrafos 3 y  49, un grupo de trabajo creado por el Ministro 
de Agricultura y del Sector Agroalimentario ha pu blicado un informe en octubre de 2006, a través del 
cual recomienda la supresión progresiva del monopolio de la Junta. ¿Podría Canadá informar si se ha 
resuelto la transformación de la Junta Canadien se del Trigo de acuerdo con el informe del grupo de 
trabajo? 
 Asimismo, ¿podría Canadá brindar mayores detalles s obre los programas de crédito a la exportación, en 
particular sobre el servicio de crédito para produc tos agropecuarios y alimenticios, los términos y 
condiciones para el otorgamiento de los anticipos , porcentaje de garantía del gobierno, períodos de 
reembolso, intereses y  primas de riesgo? 
 
IV. POLÍTICAS COMERCIALES POR SECTORES 
2) Agricultura iii) Programas de Ayuda Interna Párrafo 38, página 119 
 
¿Podría Canadá brindar información detallada  sobre las medidas que se están adoptando para 
reemplazar al Programa Canadiense de Estabiliz ación de los Ingresos Agrícolas (CAIS)? 
 WT/TPR/M/179/Add.1 
Page 48  
 
Párrafo 41, página 120 
 
Con relación a los pagos directos y pagos generale s efectuados en 2006 en el marco del Programa de 
Pagos relacionados con los Granos y las Semillas Oleaginosas (GOPP), ¿podría especificar el motivo 
por el cual se adopta como base el período 2000-20 04? Asimismo, podría indicar si existe un monto 
límite por productor, tanto para recibir pagos dir ectos como pagos generales? Finalmente, podría 
indicar qué tipo de servicios cubren los pagos generales? 
 
4) Sector manufacturero 
i) Sector de la aviación 
Párrafo 81, página 131  
¿Podría Canadá describir el paquete de apoyo que op ortunamente fue previsto para el desarrollo, ahora 
momentáneamente interrumpido, de producción de aviones de hasta 130/150 pasajeros que tenía 
previsto desarrollar la firma Bombardier? 
 
Additional Questions from Argentina
 
 
WT/TPR/G/179, INFO RME DEL GOBIERNO 
I:  ENTORNO DE POLÍTICA COMERCIAL Y ECONÓMICA Párrafo 9, página 5 
 ¿Podría Canadá informar cómo se propone crear las ventajas competitivas mencionadas en este 
párrafo? ¿Podría detallar a través de qué medidas esp ecíficas intenta lograr dichas ventajas? En cuanto 
a los cuatro principios básicos de “Advantage Canada ”, ¿podría precisar cuál será el rol del Gobierno 
(“Orientación del Gobierno”)?  II:  EVOLUCIÓN DE LA PO LÍTICA COMERCIAL, 2003-2006 
8)  Otras iniciativas g)  Estrategia en materia de ciencia y tecnología Párrafo 111, página 24 
 ¿Podría Canadá informar si fue elaborada la estrate gia de ciencia y tecnología a la que se hace mención 
en este párrafo? ¿Qué tipo de ayud a gubernamental está involucrada? 
 
WT/TPR/S/179, INFORME DE LA SECRETARIA 
 
II:  RÉGIMEN DE POLÍTICA COMERCIAL:  MARCO Y OBJETIVOS  4)  Régimen de inversiones extranjeras Párrafo 25, página 18  
¿Podría Canadá informar bajo qué parámetros se  establece que una inversi ón puede “redundar en un 
beneficio neto para Canadá”? ¿Existen casos en  los que se han autorizado inversiones bajo esta 
excepción? 
 
III:  POLÍTICAS COMERCIALES, POR MEDIDAS 
1)  Panorama general Párrafo 3, página 30 
 
¿Podría Canadá explicar las razones por las cual es se aplican las mencionadas excepciones al vino 
producido a partir de uvas cultivadas en el Canadá, y a la cerveza producida por fabricantes nacionales?  WT/TPR/M/179/Add.1 
 Page 49 
 
 
2)  Medidas que afectan directamente a las importaciones 
i) Procedimientos Párrafo 16, página 33 
 
¿Podría Canadá informar qué importadores pueden acced er al régimen de “Autoevaluación en Aduana” 
(CSA)? ¿De qué manera se instrumenta el cálculo simplificado y el pago correspondiente? 
 
v)  Otros gravámenes que afectan a las importaciones Párrafo 59, página 43  
¿Podría Canadá informar por qué razón algunas pr ovincias aplican el HST y otras no?¿Cuál es el 
motivo por el cual este impuesto puede aplicarse con diferentes tasas en función del producto?¿Existe 
alguna publicación en la que puedan  consultarse las tasas aplicadas c on el producto correspondiente?   
 
vi)  Restricciones cuantitativas y licencias 
Párrafo 69, página 47  
¿Podría Canadá indicar si existe n productos cuya importación esté pr ohibida, además de los enunciados 
en este párrafo?  
3)  Medidas que afectan directamente a las exportaciones 
iv)  Financiación, seguros y garantías de las exportaciones 
Párrafo 162, página 75 
 
¿Podría Canadá informar qué medidas se han tomado para cumplir con el OSD?  vi)  Otras medidas que afectan a las exportaciones Párrafo 176, página 79 
 
¿Podría Canadá brindar más información acerca de las “medidas de desgravación que abordan 
situaciones específicas de importación-exportación”?   4)  Medidas que afectan a la producción y el comercio i)  Marco jurídico de las empresas Párrafo 190, página 83 
 
¿Podría Canadá explicar en qué consisten los “a cuerdos fiscales” allí mencionados y cuáles son los 
requisitos que deben cumplir las empresas para acc eder a ellos?¿Qué criterios se utilizan para 
determinar la cuantía de la rebaja en la tasa ap licada?¿Existen datos acerca de cuántos acuerdos de este 
tipo se han establecido en el periodo de examen?  
IV:  POLÍTICAS COMERCIALES, POR SECTORES 
1) Visión general 
Párrafo 1, página 109  
¿Podría Canadá informar si tiene pensado mo dificar el apoyo que brinda a los productos 
agroalimentarios?  
 
Párrafo 2, página 109 
 
¿Podría Canadá informar si existe algún proyecto co n el objeto de eliminar o reducir la ayuda a los 
productos allí enumerados o te ndiente a reducir los elevados aranceles que se aplican? 
 WT/TPR/M/179/Add.1 
Page 50  
 
Párrafo 3, página 109 
 
¿Puede Canadá especificar cuáles son los dos Países  Miembros a los que se hace referencia? ¿Puede 
informar respecto de cuál fue la solución mutuamente convenida?  Párrafo 4, página 109  
¿Puede Canadá informar respecto de las características  de los incentivos fiscales? ¿Están éstos sujetos a 
metas en cuanto a producción y/o exportación?  Párrafo 5, página 110 
 
¿Podría Canadá brindar mayores detalles respecto de los incentivos a que se hace referencia en este 
párrafo? ¿Podría informar respecto de si exis te un plazo de aplicación establecido para dichos 
incentivos? ¿Están estos incentivos de conformidad con la normativa OMC? ¿Han sido notificados en 
la OMC? 
 
3)  Minería y Energía ii)  Marco institucional y jurídico Párrafo 71, página 129  
¿Podría Canadá informar si existe algún requisito  o exigencia adicional para acceder a los incentivos 
fiscales? ¿Cuál es la magnitud de dichos incentivos?  
4) Sector Manufacturero 
i) Sector de la aviación 
Párrafo 82, página 132   
¿Podría Canadá enumerar las medidas adoptadas a fin de  aumentar la competitivida d de la industria a la 
que se hace referencia en este párrafo? 
 
Párrafo 83, página 132 
 
¿Podría Canadá especificar si existen condiciones específicas para acceder a los diferentes tipos de 
apoyo gubernamental? En caso afir mativo, ¿cuáles son esas condiciones? 
 
iii)  Construcción naval 
Párrafo 91, página 134  
¿Podría Canadá informar si tiene previsto avanzar  en la consolidación de los aranceles que allí se 
mencionan? 
 
6)  Servicios financieros 
i)  Introducción 
Párrafo 129, página 144 
 
¿Podría Canadá indicar los principales puntos cont enidos en el proyecto de ley sobre legislación 
financiera presentado al Parl amento en noviembre de 2006? 
 
7)  Transporte Marítimo 
Párrafo 164, página 153 
 
¿Podría Canadá informar el motivo por el cual puede denegarse el regist ro de una embarcación 
construida fuera del país? ¿Qué motivos  dan lugar a este tipo de instrucción?  WT/TPR/M/179/Add.1 
 Page 51 
 
 
9) Servicios profesionales 
i) Servicios jurídicos Párrafo 197, página 162 
 
¿Podría Canadá informar si se está trabajando en algún proyecto para permitir a los abogados 
extranjeros actuar como consultores jurídicos en la Provincia de Queb ec y los Territorios del Noroeste, 
Yukón, y Nunavut?  
CHINA 
 
Trade Policies and Practices by Measures 
 
Measures Directly Affecting Imports
 
 
Tariffs 
 1. Canada still maintains fairly high tariffs on some  products.  High tariff is still a major barrier to 
the export of textiles, especially clothing, to Canada. For example, tariffs on wool and synthetic fiber is 
16%, and those on clothing are fro m 17.5% to 21%. Besides, tariffs on vessels and some safety 
apparatus for ice hockey are fairly high as well.  (1) Could Canada please explai n the reason for maintaining ta riff peaks in these sectors? 
(2) Does Canada have any plan to lower them? 
 
2. Canada still applies tariff quotas to some agricultural products, including eggs and egg 
products, milk, turkey and turkey products, beef, ch icken and chicken products, etc.  For example, the 
out-of-quota tariff rate on imported m ilk is 243% with the tariff rate not lower than CAN$2.82 per kilo. 
For other dairy foods for smearing, the out-of-quota tariff rate is as high as 313.5% and those on meat 
and edible offal of the poultry (fresh, chilled or frozen) are as high as 154.5% and 238%.  
(1) Could Canada please explai n the reason for maintaining su ch high out-of-quota tariff 
 rates on these agricultural products? 
(2) Does Canada have any plan to lower them?  
Quantitative restrictions and licensing 
 
3. The import and inter-provincial trade of alc oholic beverage in Canada are subject to the 
Importation of Intoxicating Liquors Act, which gives provinces much discretion over the sale, import 
and inter-provincial transportation of spirits.  Curren tly, PLB is the sole agency to exercise the above 
policies, which include: imposing a higher mark -up on imported products than on domestic like 
products;  setting floor and ceiling prices on imported products;  etc.  
(1) Please explain the reasons for adopting these measures? 
(2) What is the basis on which the PLB sets floor and ceiling prices on imported products? 
(3) Please explain the conformity of the above policies with the national treatment principle 
 of the WTO?  Contingency Measures 
 4. Sections 30.2-32.22 of the Canadian Inte rnational Trade Tribunal Act provides for the 
procedures regarding special safeguard and temporar y safeguard measures against imports of specific 
Chinese products.  WT/TPR/M/179/Add.1 
Page 52  
 
(1) Please elaborate the rationale and basis for the low threshold to initiate investigations. 
(2) Please explain why the procedures lack specific provisions on consultation, hearing and  confidentiality. (3) What are the criteria used in the Act to de termine the existence of market disruption and 
 trade diversion? 
 
5. Canada’s Special Import Measures Act (SIMA) and Chapter 2 and 3 of Special Import Measures Regulations contain specific provisions re garding the amount of subsidy and the initiation, 
investigation and determination.  
The simplicity of the Act’s provisi ons regarding the existence, am ount and nature of a subsidy, 
particularly on the burden of proof on complainan ts, tend to result in an easy determination of the 
existence of a subsidy.  
Could Canada please explain their consiste ncy with Article 11.2(ii) of the ASCM? 
 
6. On November 3
rd, 2006, CBSA issued the Statement of Reasons for the preliminary 
determination regarding the counter vailing investigation against copper  pipe fittings.  While calculating 
the subsidy amount, CBSA estimated the amount through comparing the average export price of the products under investigation with the productio n costs provided by Canadian complainants. 
 (1) Could Canada please explain the reason no t to take into account the information 
 provided by the Chinese side? (2) CBSA used a “constructed price” similar to  that used in antidumping investigations in 
 calculating amount of the subsidy. How does Canada explain its consistency with Article  14 of the ASCM? 
 
7. On April 28
th, 2004, Canada initiated inv estigation into the alleged dumping and subsidizing of 
Chinese Carbon & Stainless Steel Fasteners.  In the investigation, the Canadi an authority adopted the 
Best Information Available (BIA) to determine a 31.5% subsidy amount simply on the ground that the 
information provided by the Chinese government is incomplete and that the information provided by 
government and by enterprises is inconsistent with each other. 
 
Please explain the conformity of this practice to the ASCM of WTO. 
 
Technical regulations, Confor mity Assessment, and Standards 
 8. Regulations on Fresh Vegetables  and Fruits  contain specific requirements on the size, weight 
and labeling of packaging.  For instance, the net weight in a pack  for apples, apricots, peaches and 
pears sold in Canadian market shall not surpass 200 kg (442 pounds).  
(1) What are the basis for all the specifica tions on packing contained in the Act? 
(2) For the purpose of trade facilitation, does Ca nada plan to streamline its requirements on 
 packing?  
9. For imported fresh and processed vegetables a nd fruits over the packing limit, Canada requires 
that the importers shall provide evidence of short su pply of the product in domestic market in order to 
obtain government’s import permit. 
 
Does this imply that packing requirements are related to import restrictions? 
 
10. Although Canada’s Textile Labeling Act  does not require marking of the filled fibers, the 
provinces of Quebec, Ontario and Manitoba request th at each filled costume or toy should have special 
label indicating the filled fibres and that manufactur ers of these products must get registered in  WT/TPR/M/179/Add.1 
 Page 53 
 
 
provincial authorities according to the three provinces’  relevant laws with a registration fee of 400 
Canadian dollars.  
How does Canada ensure the uniform applicatio n of its policy regarding labeling requirements 
across the country? 
 
Sanitary an phytosanitary measures 
 
11. The Canadian food inspection agency used the same test procedures and test standards with 
regard to aluminium tins and alloy tins when testi ng the completeness of tin pack.  Therefore, it is 
difficult for aluminium cans to pass the test.  
 
Please explain the reasons for using the same  testing procedures and standards for both 
aluminium tins and alloy tins. 
 12. According to Canadian Food and Drug Act and Regulations , use of caffeine is restricted in 
coke drinks. It is claimed that such regulations are based on the assumption that caffeine is harmful to 
children’s health.  In 2003, Health Canada appraised the effect of caffeine to children, but did not reach 
a final conclusion.
1 
 
(1) Please explain the necessity  of the above restriction. 
(2) Please explain the consistency of this restriction with WTO/SPS Agreement. 
 Trade Policies by Sector 
 
Agriculture
 
 State-trading Enterprises  
13. CWB is a state-owned enterprise which, under authorization of the government, is exclusively 
engaged in the export of wheat and barley in western areas.  All export credit of the CWB is guaranteed 
by the federal government via various programs. Ca nada does not accord same treatment for domestic 
and imported corn.  For example, CWB enjoys preferential treatment on railroad transportation 
charges.  
 
Please explain the conformity of the above policies with relevant WTO rules. 
 Fishery
 
 14. The shares held by foreigners in compani es with Canadian commercial fishing license is 
restricted to 49%. 
 
Please explain the reasons for the above restriction. 
 
Telecommunication and broadcasting services
 
 15. Please describe the development of Canadian telecommunication market, including, inter alia, 
the major carriers and their market shares. 
 
16. Please describe the current situation of fore ign investment in Canadian telecommunication 
industry, including, inter alia, the number of fore ign service providers and their market shares and 
business scope. 
                                                     
 
1 Source:  the official website of the EC. WT/TPR/M/179/Add.1 
Page 54  
 
17. Please describe the application procedures fo r a foreign service provider to enter Canadian 
telecommunication market and list the documents needed .  Are there any procedures relating to internet 
and information security? If yes, please briefly describe them.  18. What are the main laws and regulations re gulating the telecommunication market in Canada? 
 
19. Canadian Telecommunications Law  stipulates that in enterprises engaged in the business of 
transmitting equipment, shares directly held by a foreign investor shall not exceed 20%;  shares 
indirectly held by a foreign investor shall not exceed 33%;  total share under effective control of 
foreign investors shall not exceed 46.7%. 
 
Please explain the reasons for the above restrictions. 
 
Financial Services
 
 
20. In order to invest in Canada, foreign fi nancial institutions should apply to the OSFI. 
 
Please provide the number of approvals and de nials made by the OSFI concerning the 
applications by foreign financial institutions since 1995 until now. 
 
Air Transport  
 
21. Foreign investors’ shares in Cana dian airlines are restricted to 25%. 
 
Please explain the reasons for the above restriction. 
 Professional Services
 
 
Legal services 
 
22. In Prince Edward Island, Ontario, Alberta and Newfoundland, permanent residence is one of 
the requirements for the registration of a lawyer, while  in Quebec, a lawyer must be a Canadian citizen. 
 
Please explain the reasons for the above requirements. 
 
Architectural and engineering services 
 
23. Anyone who wants to engage in architectural services must obtain a license for a provincial or 
regional architect association. An applicant must pass qualifications test.  
Could Canada provide the information on how many applications from foreigners have been 
approved, how many have been rejected since 1995 until now? 
 Other services
 
 24. The Investment Canada Act stipulates that the publication and distribution of books with 
foreign investment must fit the national cultural pol icy of Canada, and generates a “net benefit” for 
Canada. Besides, direct acquisitions of Canadian publishing houses by foreign investors are prohibited. 
 
Please explain how the relevant Canadian author ities determine if an application “fits the 
national cultural policy of Canada” and what is a “net benefit”. 
 
25. The acquisition by foreign investors of film distribution companies controlled or owned by 
Canadians are prohibited. Foreign investors are allo wed to establish new film distribution companies  WT/TPR/M/179/Add.1 
 Page 55 
 
 
only when Canadian importers has got global distribu tion right or is the main investor of the new 
established company. Foreign investors may directly or indirectly acquire film distribution companies 
within the territory of Canada only when they re-invest their revenues in Canada. 
 
Why does Canada set the above restrictions? 
 
26. Many Chinese companies complain that the ex amination and approval process of short-term 
business visas, work permits and work visas for their staff are over-complicated and time-consuming, which hinders their business and investment activities in Canada.  Could Canadian government streamline those pr ocedures in order to guarantee the normal 
conduct of business between China and Canada? 
 
KOREA 
 
I. Economic Environment 
 
Tax Reduction Policy  
(WT/TPR/S/179  pp.5~6 para.15~19)  
 
Canada has posted fiscal surpluses as a result of tax reform and the reduction of inefficient government 
expenditure since the early 1990s. This prudent fi scal policy is a good example for other countries.  
 
However, it is known that since the year 2006, the Canadian government has taken measures to reduce 
taxes such as GTS (Goods & Service Tax), federal cor poration tax, personal inco me tax and has offered 
various tax credits.  
 
Does Canada expect to achieve its goals, such as an annual fiscal surplus of between Can$2 billion and 
Can$4.2 billion in the following five years, an a nnual federal debt reduction of Can$3 billion during 
the same period, and the elimination of the govern ment's net debt by the year 2021, under such a 
wholesale tax reduction policy?  
 
Policy Plans in Light of Change in the Trade Environment  
(WT/TPR/S/179  pp.7~10 para.22~23)  
 
The Canadian current account of the balance of paym ents has been in surplus since 2002. Canada has 
achieved positive economic outcomes with its twin surp luses, the fiscal surplus and the surplus in the 
current account balance, becoming the only OECD country to achieve twin surpluses. 
 
However, it appears this economic accomplishment is  mostly attributable to the changing environment 
of international trade, including soaring energy pri ces and booming oil and gas production.  In contrast, 
exports in manufacturing have declined a nd productivity growth is relatively slow. 
 
In order to insulate itself from a fall in prices of  energy and mineral resources in the international 
market, Canada would be required to enhance the co mpetitiveness of its manufacturing and to diversify 
its export market.  What are Canada’s plans in this regard?  Trade policy regime 
 
The Status Quo and Plans for FTAs/RTAs  
(WT/TPR/S/179  pp.19~22 para.40~67)  
 
Canada resumed FTA negotiations with the EFTA  states and Singapore in November 2006.  In 
particular, the FTA negotiations with the EFTA states  have reached their final stages.  We would like WT/TPR/M/179/Add.1 
Page 56  
 
to kindly request Canada to provide detailed informa tion on the current situation of Canada's FTAs, in 
particular with the EFTA states and Singapore.  
 
Furthermore, Canada has recently begun to focus on FTA and RTA negotiations, although in the past it 
has given priority to the WTO/DDA negotiations.  We  would like to kindly ask Canada to elaborate in 
detail on its plans to launch FTA/RTA negotiations with countries other than those introduced in the 
TPR report.  
 
III. Trade policies and practices by measure 
 
Government Procurement at the sub-federal level  
(WT/TPR/S/179  pp.70~76 para.210~230)  
 Canada is a member of the WTO government proc urement agreement.  The Canadian government, 
however, has not yet opened its sub-central government  procurement market despite its commitment to 
do so no later than July 1997. 
 Most Canadian provinces have introduced discr iminatory procurement policies, such as price 
preferences that favor suppliers located within th e province.  According to Article 3 of the WTO 
government procurement agreement, a member s hould grant national treatment to other member 
countries.  The Korean government is concerned that the aforementioned policy of the Canadian 
government does not coincide with the rules of the WTO.  
 Korea hopes that the Canadian government will  immediately open its sub-central government 
procurement market and encourage its provinces to eliminate their discriminatory procurement 
policies.  What is the Canadian government's position on this?  
 Prohibition against the Importation of Used Motor Vehicles  
(WT/TPR/S/179  p.38 para.69)  
 Importing used motor vehicles of all kinds is pr ohibited by the Canadian government. Exceptions 
include used motor vehicles that are 15 years or older and those imported from the United States.  The 
policy regarding the import of used vehicles from Me xico is also being progressively liberalized.  
 
According to Article 11 of the 1994 GATT, member s should eliminate quantitative restrictions.  The 
Korean government is concerned that the Canadian government's policy regarding the import of used 
vehicles does not coincide with the regulations of the WTO.  
 
What is the Canadian government's position on openi ng its used motor vehicles market by amending its 
related regulations?  Unify Labeling between the Federal G overnment and Provincial Governments  
(WT/TPR/S/179  p.44 para.93) 
 Although the Canadian federal government requires ma nufacturers to mark only fiber in textiles on 
clothing labels, some provincial governments, su ch as Quebec, Ontario and Manitoba, require 
manufacturers to attach a label disclosing the fiber co ntent of the filling for stuffed garments, such as 
down coats.  Additionally, manufactu rers that produce stuffed garments are required to register with 
provincial authorities at a cost of CDN$400.  
 
Does the Canadian government have plans to unify pr ovincial labeling regulations with the regulations 
of the federal government, particularly with regards to the content of stuffed garments?  
  WT/TPR/M/179/Add.1 
 Page 57 
 
 
Anti-dumping Measures: Trade Remedy Policy 
(WT/TPR/S/179  pp.38~44 para.71~92)  
 At end June 2006, 48 anti-dumping measures, one price undertaki ng and five countervailing duty 
orders remained in force in Canada.  
 
Contingency trade measures should be placed to protect domestic industries from unfair foreign trade 
practices in exceptional cases.  Given that even an initiation of an investigation affects the business 
activities of the company under investigation by impos ing additional burdens, Canada is requested to 
be more cautious before taking such measures.  
 
We are pleased to note that the current (as of J un 2006) number of trade remedy measures taken by 
Canada has significantly dropped (Anti-dumping measures: 91 → 48, Countervailing duties:  10 → 5) 
in comparison with the past (during the TPR in 2003).  Continuing with this trend, Canada is requested 
to be more cautious before taking such contingency measures.  
 
IV. Trade policies by sector 
 
Supply Management  
(WT/TPR/S/179  p.87 para.2)  
 
Canada protects supply-managed products, which c over dairy products, poultr y and eggs, by imposing 
a tariff rate that is over 200 per cent on the goods which exceed the quota.  
 
As the WTO DDA resumed, the Canadian government  emphasized the need to abolish all kinds of 
export subsidies in the field of agricultural goods, re duce domestic subsidies which distort international 
trade, and improve the real and substantial level of market access.  
 
Canada has international competitive power in the agricultural field and is classified as an agricultural 
exporter.  With this status in mind, is it still necessary to maintain the Supply Management System?  
 Canadian Wheat Board  
(WT/TPR/S/179  p.76 para.231, p.87 para.3, pp.96~98 para.47~54)  
 Canada is reviewing a staged elim ination of the monopoly of the Canadian Wheat Board, which has the 
monopolistic right of sales for export and for domest ic human consumption of wheat and barley 
produced in Western Canada.  
 
What is the Canadian government’s view on the posi tion of the Canadian Wheat Board with regards to 
monopolizing the market and how does it plan to improve  the situation?  Furthermore, are there similar 
reviews related to the state-trading enterprises, su ch the Canadian Dairy Commission, that have been 
notified to the WTO?  
 Providing Data on Maritime and Port  
(WT/TPR/G/179  p.20 para.102)  
 
Foreign export enterprises currently face difficultie s, such as extending the period of transport and 
dealing with rising transportation prices, due to a slowdown in the distribution of goods between 
Vancouver and Toronto.  
 To cope with this problem, the Canadian government is taking measures to expand and improve its 
transportation infrastructure through a plan known as,  "Asia Pacific Gateway and Corridor Initiative".  
 WT/TPR/M/179/Add.1 
Page 58  
 
Exports are usually loaded two to three weeks prio r to the actual delivery da te in order to deliver 
products to their destination in a timely manner.  Ho wever, access to statisti cal data on maritime and 
ports is prohibited for the sake of public security.  Ko rea hopes that Canada will provide data similar to 
the data provided by the U.S. so that shipping industries will be able to implement progressive 
transport plans.  
 
COSTA RICA  
Obstáculos Técnicos al Comercio 
 
1. Párrafo 93. ¿Que medios de coordinación existen en Canadá para evitar que exista 
contradicción entre los reglamentos técnicos emiti dos por los gobiernos federales, provinciales y 
territoriales? ¿Cómo puede esto afectar el comercio? En caso de conflicto, ¿qué procedimiento existe 
para la solución del mismo?   2. Párrafo 97. ¿Qué porcentaje de los reglamento s técnicos notificados por Canadá durante el 
periodo en examen están basadas en normas internacionales? 
 3. Párrafo 103. ¿Cuáles son los aspectos que se cons ideran para la evaluación de impacto de los 
reglamentos técnicos? ¿Qué sucede si la relación cost o - beneficio se inclina hacia un mayor costo de la 
reglamentación respecto a su beneficio?  Medidas antidumping y medidas compensatorias 
 
4. Párrafo 74.  ¿Cuáles son las razones o los crite rios valorados por Canadá  para exigir que los 
compromisos de precios únicamente puedan ser ofr ecidos por exportadores o gobiernos extranjeros que 
reúnan al menos el 85% del total del volumen de los bienes importados objeto de investigación? De 
conformidad con la legislación canadiense sobre el tema, ¿se descartaría ad portas cualquier 
compromiso de precios ofrecido que no reúna dicho porcentaje?  
Salvaguardias 
 
5. ¿Podría Canadá aplicar un arancel menor al de terminado en la investig ación de una medida de 
salvaguardia, si las autoridades correspondientes cons ideran que no conviene al interés público?  En 
otras palabras, ¿los criterios de  interés público podrían ser aplica dos a investigaciones sobre medidas 
de salvaguardia de la misma forma en cómo se  aplican a los procedimientos sobre medidas 
antidumping y/o compensatorias?  Telecomunicaciones 
 
6. ¿Cuántas empresas se encuentran prestando ser vicios de telecomunicaciones actualmente en 
Canadá?   
7. ¿La legislación de telecomunicaciones de Ca nadá se encuentra basada en la noción de 
convergencia, o es una legislación basada en la regulación de servicios?   8. ¿Qué tipo de reformas en la legislación se es tán planteando, con el fin de responder mejor a los 
cambios del entorno tecnológico?   
9. ¿Por qué razón de junio de 2003 a junio de 2006 el Canadá descendió del segundo al noveno 
lugar entre los países de la OCDE en lo que se re fiere a tasas de penetración de banda ancha?  ¿Esta 
situación se debió a problemas de regulación?  10. ¿Podrían explicar en qué consiste la política de servicio uni versal que se desarrolla en Canadá?  WT/TPR/M/179/Add.1 
 Page 59 
 
 
11. ¿Podrían explicar en que cons isten las medidas de política que se pueden adopta para limitar la 
agregación del espectro?  
Seguros 
 12. ¿A qué razones obedece la decisión de que las  compañías de seguros deban obtener una 
licencia en cada provincia en la que realizan negoc ios? ¿Se ha pensado en modificar esta situación? 
 13. La regulación de seguros, así como la autorida d encargada de aplicarla,  ¿es particular para 
cada provincia?  ¿Existe también una  legislación y regulación federal? 
Contratación Pública 
 14. Párrafo 219. ¿Qué implicacion es conlleva el examen de contratos superiores a 2 millones con 
miras a beneficios regionales e industriales?  ¿El ex amen se realiza como etapa previa al proceso de 
contratación, o se realiza como una etapa del proceso? 
 
15. Párrafos 222 y 223.  ¿Cuál es la diferencia de procedimientos entre el aviso previo de 
adjudicación de contrato y la contratación no competitiva?  
Servicios bancarios 
 16. Página 147, párrafo 140.  Los bancos nacional es y las filiales de los ba ncos extranjeros deben 
obtener una carta patente para su constitución expedida por el Minister io de Hacienda (párrafo 139). El 
párrafo 140 indica que se debe tomar en cuenta todos  los factores pertinentes para determinar si se 
emiten las cartas patentes, y uno de esos factores pertinentes es "el interés del sistema financiero canadiense".  Con relación a este tema, Costa Rica es tá interesada en conocer: ¿cuáles son los factores 
que toman en cuenta para denegar la emisión de la carta patente en  función del “interés del sistema 
financiero canadiense”?  ¿En qué casos concretos se pue de denegar la carta patente, de acuerdo con el 
interés del sistema financiero canadiense?  17. Página 148, párrafo 144.  En este párrafo se indi ca: “Al menos la mitad de los directores de las 
filiales de bancos extranjeros y al menos dos tercio s de los directores de cualquier otro banco deben 
residir en el Canadá en el momento de la elección o la designación de cada director.”  ¿Existe algún 
procedimiento diferenciado con respecto a otros inmi grantes para que los extranjeros que deseen ser 
directores de bancos obtengan su residencia?  ¿El director tiene que ser residente durante todo el 
tiempo que funja como tal o debe serlo únicamente cuando sea elegido?  
18. Página 146, párrafo 136 y página 149, párrafo 146.   El párrafo 136 indica que el seguro de los 
depósitos no cubre los efectuados en sucursales de servicios múltiples, mientras que el párrafo 146 
establece que las sucursales de servicios múltiples de bancos extranjeros no pueden ser admitidas como 
miembros de la Sociedad de Seguros de Depósitos del Canadá.  ¿El seguro de los depósitos no cubre 
los efectuados en sucursales de servicios múltiples, sean nacionales o extranjeros, o dicha limitación 
aplica sólo para las entidad es extranjeras?   En caso de que aplique n sólo para las entidades extranjeras, 
¿Cuál es la razón para tal diferenciación? 
 
Régimen de Inversiones Extranjeras 
 
19. Párrafo 22 ¿Cualquier persona, física o jurí dica, nacional o extranjera, puede realizar la 
notificación para establecer una nueva  empresa o adquirir el control de una empresa existente? ¿Cuál es 
el procedimiento que se da a estas notificaciones?  WT/TPR/M/179/Add.1 
Page 60  
 
Transporte marítimo 
 
20. Párrafo 162 ¿Cuáles son los principales ca mbios que se realizaron a la legislación sobre 
transporte marítimo?  Transporte aéreo 
 
21. Párrafo 192.  Según se indica, Canadá no ha c onsolidado en el marco del AGCS el suministro 
de los servicios de reparación y mant enimiento de aeronaves mediante el  consumo en el extranjero y se 
reserva la posibilidad de obligar a las compañías aéreas a recurrir a los servicios de reparación y 
mantenimiento nacionales.  ¿La legislación canadiense prohíbe expresamente a las compañías aéreas 
canadienses el consumo en el extranjero de los ser vicios de reparación y mant enimiento de aeronaves? 
¿Cuáles son las limitaciones existentes para que una empresa extranjera pueda establecerse en Canadá 
y brindar estos servicios?  
22. Según se indica, todas las operaciones de mantenimiento y reparación de aeronaves de 
matrícula canadiense deben ser realizadas por orga nizaciones aprobadas. Las autoridades señalan que 
"aprobado" significa aprobado de conformidad con el Reglamento de Aviación del Canadá, o el 
reglamento de un Estado extranjero que sea parte en  un acuerdo o arreglo técnico con el Canadá.  En 
ausencia de un acuerdo o arreglo, ese mantenimiento sólo puede ser realizado por una organización 
extranjera en el marco de un contrato con una organización canadiense, siempre y cuando la 
organización canadiense lleve a cabo la supervisi ón necesaria para asegurar el cumplimiento del 
reglamento aplicable.  ¿Qué requisitos existen pa ra realizar un contrato entre una organización 
canadiense y una extranjera para prestar estos servicios?¿Quién regula la relación entre ambas 
organizaciones?¿Esta relación contractual debe ser aprobada por alguna autoridad canadiense? 
 Servicios profesionales 
 
23. ¿Cuáles profesiones están reguladas en el Canadá a nivel nacional y cuáles a nivel provincial/territorial?  
TURKEY 
 
I. ECONOMIC ENVIRONMENT, Para 3 
 
II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
 
(4) Foreign Investment Regime, Para 20, 26: 
 
The Secretariat Report reflects that Canada belongs to the Group with the highest level of overall 
restrictiveness to Foreign Direct Investment as m easured by the OECD’s FDI regulatory restrictiveness 
index.  
It has been noted that there are sector-specific restrictions to FDI and according to the Investment 
Canada Act, a foreign acquisition abov e a given threshold is subject to review to ensure that it results in 
a “net benefit” to Canada.  Secretariat Report also highlights slow productivity growth as a feature of the economy, and indicates 
among others to remove restrictions   on foreign investment as a tool  to accelerate productivity growth. 
 
Could Canadian Delegation elaborate on if there are any plans to remove restrictions to FDI? 
  WT/TPR/M/179/Add.1 
 Page 61 
 
 
We would also like to request the Delegation of Canada to explain the terms and thresholds, if 
exist any, to assess the “net benefit criterion”.  Are these criteria applied on a sector specific basis?  As a member of the APEC, which steps does Cana da take to achieve APEC’s goal of free and 
open trade and investment by 2010 for developed economies? 
 How does Canada consider to deal with the proble m of slow productivity growth?  Are there any 
plans to benefit from investment policies to ac hieve higher level of productivity in Canadian 
economy? 
 
TRADE POLICIES AND PRACTICES BY MEASURE  (2) Measures Directly Affecting Imports (v) Other Charges Affecting Imports, Para 57 
 According to the Secretariat Report, the goods a nd services are levied under the Excise Tax Act which 
is defined as the Canada’s largest indirect tax by revenue, amounting to ar ound 15% of total federal 
budgetary revenue.  
Could Canadian Delegation clarify th e reason to this tax arrangement? 
 
Could Canadian Delegation confirm the all import s regardless of their sources are levied under 
the excise tax? 
 
MEASURES AFFECTING PRODUCTION AND TRADE 
(iv) (b) State-Owned Enterprises, Para 232  
Secretariat Report mentions that Canada has around 100 state-owned enterprises while it has been 
noted that no information was available on sub-federal ones.  
Does Canada have a plan to privatize state owned enterprises? 
 
Are there any analysis to measure the impact of  state-owned enterprises on Canadian economy? 
 
HONG KONG, CHINA  
 
Tariffs  
 
(WT/TPR/S/179, P. 31-32, Paras. 37, 39 & Table III.1)  1. We appreciate that Canada has bound 99.7% of its tariff lines and that the simple average 
applied tariff had declined slightly from 6.8% in 2002 to 6.5% in 2006, due to tariff reductions 
following the implementation of WTO commitments.  We note from the Secretariat Report that for 23 
tariff lines, the ad valorem  equivalents could not be estimated.  Grateful for the clarification from 
Canada.  
Anti-dumping (AD) 
(WT/TPR/S/179, P. 42, Para. 82) 
 2. We are interested in the operation of the publ ic interest enquiry as reported in paragraph 82 of 
the Secretariat Report.  In particular, we would like to know whether it is mandatory for CITT to 
conduct public interest enquiries whenever requests ar e received.  Also, is CITT empowered to initiate WT/TPR/M/179/Add.1 
Page 62  
 
such an enquiry on its own without a request from the trade?  If yes, has any such enquiry been 
conducted before?  
Competition 
(WT/TPR/S/179, P. 79, Para. 246)  
3. It is stated in the Secretariat Report that the Canadian Competition Bureau is "examining tools 
that could be used to develop legislation with a view to limiting government intervention through the 
least intrusive means possible".  Grateful if Cana da can provide more information about these tools. 
 Telecommunications 
(WT/TPR/S/179, P. 109, Para. 107) 
 4. It is stated in the Secretariat Report that in  the context of Canada's previous Review, several 
WTO Members asked about prospects for liberalizing th e limitations on foreign ownership and control.  
According to the Canadian authorities, Canada is examining the potential benefits and implications of 
increasing foreign investment in the Canadian tel ecom industry.  However, no decision to amend the 
existing regime has yet been made.  Grateful if  Canada would advise on the latest progress of the 
examination, the current timetable for its comp letion and for the announcement of the outcomes. 
 
Audiovisual Services 
(WT/TPR/179, P. vii, Para. 1) 
 5. We note from Canada's revised offer that it is  currently maintaining two MFN exemptions on 
audiovisual services concerning film, video and tele vision programming co-production.  Grateful to 
know if the measures under the exemptions are applie d by national origin of the audiovisual works;  
and if so, how the national origin is applied, whet her by the origin of the funding party, the production 
crew, or the place of production, etc.  6. As stipulated in the Annex on Article II Exemptions to the GATS, all MFN exemptions 
maintained by Members should be reviewed from time to time, be in principle not more than 10 years 
in duration, and in any event, be subject to ne gotiation in subsequent tr ade-liberalization rounds.  
Grateful if Canada would advise whether it w ould consider removing the two MFN exemptions 
currently maintained by it in its future offers.  If not, what are the reasons behind and would Canada 
consider clarifying the exemptions in terms of their scope of application and duration instead? 
 
Banking Services 
(WT/TPR/S/179, P. 114-5, Paras. 134-5) 
 7. While Canada has inscribed in its GATS sche dule a 10% ceiling for the acquisition of shares of 
a Canadian bank with over Can$1 billion in equity, it is noted from the Secretariat Report that under 
Canada's existing regime, only banks  with equity of Can$5 billion or more (i.e. large banks) must be 
widely held with no more than 20% of the bank's voting shares or 30% of its non-voting shares 
acquired by a single person.  No such ceiling is how ever being imposed for medium banks (i.e. equity 
of Can$1 billion or more, but less than Can$5 billion) and small banks (i.e. equity of less than Can$1 
billion), though approval from the Ministry of Finan ce is required for any single person to own more 
than 10% of the shares.  Given the de facto  more liberal regime, would Canada consider binding its 
existing regime in the current round of services nego tiations in line with its commitment to reducing 
impediments to trade and enhancing predic tability in the multilateral trading system? 
 8. As mentioned in paragraph 135 of the Secret ariat Report, the Canadian Government proposes 
to increase the equity threshold for large banks to  Can$8 billion, and for sma ll banks to Can$2 billion.  
Grateful to know more details about the proposal  including its latest progress and the expected 
timeframe for its implementation.  WT/TPR/M/179/Add.1 
 Page 63 
 
 
THAILAND 
 
WTO Secretariat Report (WT/TPR/S/179)  
II. T
RADE POLICY REGIME : FRAMEWORK AND OBJECTIVES  
(5) I NTERNATIONAL RELATIONS  
(ii) Preferential trade agreements and other arrangements (a) Free-trade agreements 
 
1. (Pages 19-22) Canada has a number of FTAs w ith its key trading partners.  Could Canada 
indicate those products whose market access to Ca nada is normally limited or excluded from FTA 
negotiations? 
 
III. T
RADE POLICIES AND PRACTICES BY MEASURE  
(2) M EASURES DIRECTLY AFFECTING IMPORTS  
(ix) SPS Measures 
 
2. (Page 50, Table III.7) Table III.7 of the Secretariat Report indicates that in the years 2005 and 
2006 Canada undertook 7 and 4 em ergency measures respectively.  Table III.7 also indicates that 4 of 
the 7 emergency measures taken in 2005 and 1 of  the 4 emergency measures taken in 2006 were 
identical to or based on international standards, suggesting that for both 2 005 and 2006 Canada applied 
3 standards not in conformity with or based on in ternational standards.  Please specify the products 
against which these non-conforming standards were applied, and describe any relevant SPS import 
requirements and risk assessments, including the duration of such assessments.  
IV. T
RADE POLICIES BY SECTOR  
(2) A GRICULTURE  
(i) Introduction 
 
3. (Page 88, para 11) The Secretariat Report men tions that in June 2002 the federal, provincial, 
and territorial governments of Canada signed th e Framework Agreement on Agricultural and Agri-
Food Policy for the Twenty-First Century (Agricultu ral Policy Framework: APF) to enhance the agri-
food sector’s profitability.  The Government Report (Page 21, para 106) also indicates that the APF 
was implemented to position Cana da as the world leader in food safety and quality as well as 
responsible agricultural production, but does not provide details on the APF.  
 Please explain the following APF categories in detail: 
 (1) Business risk management 
 (2) Food safety and food quality  (3) Science and innovation   (4) Environment  (5) Renewal  
Please also provide examples of programs and services under each APF category 
  In addition, both Reports mention that most of the APF agreements will expire in 2008, and 
that Canada has been holding consultations with st akeholders on how to transform the APF.  Please 
describe any intended changes to the APF. 
 
4.  (Page 90, para 14) The Secretariat Report describes certain elements of Canada’s OECD Producer Support Estimate (PSE).  What is the ratio  of government payment to producers compared 
with government price support?  Please also explain how Canada calculates its PSE of payments based 
on historical entitlements and farm income. 
 WT/TPR/M/179/Add.1 
Page 64  
 
(ii) Border and related measures 
 
5. (Page 91, paras 19-20) The Secretariat Report indicates that Canada grants preferential access under its free trade agreements to the same WTO in -quota volumes rather than establishing additional 
tariff quotas for those products.  In addition, so me preferential access under Canada’s WTO TRQ 
commitment varies from year to y ear since its share is defined by  a share of domestic production.  
Please clarify this preferential access in light of MFN considerations.  6. (Page 91, para 20) The Secretariat Report st ates: “Canada’s preferential trade agreements 
establish tariff quotas with in-quota volumes defined as a share of domestic production in a base year, 
rather than in absolute term s as is the case under Canada’s WTO commitments.”  What are the 
differences between the PTA figures versus the WT O figures?  Please also indicate how the PTA and 
WTO tariff quotas are each calculated.  7. (Page 92, para 25) Please describe the requirement s for quality, labeling, packaging, health and 
safety, and any other such requirements as defined in the Fresh Fruit and Vegetables Regulations.  
Please also indicate whether there are any different requirements for importing fruit and vegetables from tropical countries.  
(iii) Domestic programmes 
 8. (Page 93, para 30) How and when are Canada’s  price support mechanisms for milk and milk 
products applied?  How are the milk production quotas (Market Sharing Quota) in each province 
allocated?  9. (Page 93, para 33) Please clarify in deta il how provincial poultry producer boards and 
processors negotiate prices for poultry b ased on a cost of production formula. 
 10. (Page 94, paras 34-36) Please provide more details on the Canadian Agricultural Income 
Stabilization Programme (CAIS).  In particular, how are participation fees determined in relation to 
producer coverage?  How has the method for this determination changed compared to pre-2006 fees 
(22% for participants w ith maximum coverage)? 
 
11. (Page 94, para 37) We appreciate the Secret ariat Report’s description of payments under the 
CAIS programme’s tier system in pa ragraphs 37, and believe that in cluding a graphical explanation or 
summary chart would also be useful.  If such a chart is already available, we would appreciate it if 
Canada could either provide it or direct us to it. 
 
12. (Page 95, para 40) Please provide more deta ils about the government guarantee Price Pooling 
Program and the Farm Improvement and Ma rketing Cooperatives Loans Act (FIMCLA). 
 
(v) State-trading enterprises 
 13. (Page 97, para 50) Please provide more details  on the delivery contracts that CWB establishes 
with farmers to coordinate the delivery of CWB gr ain into the handling system, including the various 
market conditions that have been or may be taken in to consideration when establishing such contracts.  
In addition, which market conditio ns would warrant CWB’s deferral of export sales?  Finally, when 
does the CWB limit the amount of grain to be accepte d for delivery, and why/how is this dependent on 
sales? 
 14. (Page 98, para 51) The Secretariat Repor t notes that CWB proceeds from grain sales are 
deposited into one of four “pool” accounts for each gr ain category.  It further notes that Government 
direct financial transfers may occur when the pool accounts register a deficit.  Under what  WT/TPR/M/179/Add.1 
 Page 65 
 
 
circumstances have such transfer s occurred in the past, or if they have not occurred, under what 
circumstances might they take place?  
PAKISTAN 
 
Development: 
 
1. At the Hong Kong Ministerial Conference in December 2005, Ministers agreed that for grant of duty free, quota free access to LDCs, its impact on other similarly placed countries would be taken into account.  Has Canada analyzed as to how this  initiative affected in real terms the imports from 
other low-income developing countries such as Paki stan when Canada allowed duty free quota free 
market access to some countries?  
Industrial Goods: 
 2. While there is liberal trade environment for industrial goods, some non-tariff barriers like 
undue delay of containers at the port of landing, dive rsion of cargo to other ports and inspection hassles 
add to the cost of doing business; and discourage Ca nadian importers to retain the supply chain with 
the established partners.  Would Canada like to ex plain the reasons as to why imports coming from 
developing countries are subjected to discriminator y practices; and does Canada have any plan to 
redress such grievances?  Agriculture: 
 
3. Pronounced tariff escalations among semi-process ed and fully processed agricultural products 
have an adverse impact on investment in food processing sectors in developing countries.  Does 
Canada intend to adjust these tariff escalations in order to encourage value-added exports from 
developing countries?  4. As per Canadian law, the importers of fr esh fruit and vegetables must be licensed by the 
Canadian Food Inspection Agency, which delays th e export of developing countries executed by new 
importers in Canada.  Is there any plan to pr ovide some Special and Differential Treatment to 
developing countries in this regard? 
 
Immigration and Visa Policy: 
 
5. While the Canadian government is encourag ing immigration of professional human resource 
from Pakistan, it is generally denying business visas to the genuine business persons, who are 
nominated by their respective trade bodies and re commended by the government for their business 
related travel.  Could Canada justify such di scriminatory policies that run against business and 
economic interest of developing countries?  
INDIA  
 
Q1. We have been informed by small scale exporte rs from India that they are facing payment problems 
as importers in Canada are not honour contractual obligations.  As the scale of such business operations 
is small therefore they find it difficult to resort to  costly and time consuming legal recourse and this 
also constitutes a NTB.  We request Canada to info rm if any mechanism is put in place to investigate 
such cases and provide assistan ce to small scale exporters from developing countries.  
 Q2. We have come across reports from Indian e xporters of spices to Canada that the labeling 
requirements in respect of spices are not standardi zed and therefore it creates complications at the time 
of import clearance and sale in the domestic market.  May we request Canada to put in place a WT/TPR/M/179/Add.1 
Page 66  
 
standardized system of labeling to assist the exporte rs of such products from India and other interested 
countries.  Q3. Indian trade delegates participating at trade fair s in Canada are frequently denied visas in an ad-hoc 
manner.  This causes financial loss to them as they have paid up the registration charges, rentals for 
stalls and also has an opportunity cost.  This is c ontrary to the desire of the two countries to promote 
people to people and inter business exchanges between  India and Canada.  We request Canada to 
clarify the visa regime so that such  cases are reduced to the minimum.  
 
BOLIVIA 
 
Informe de Gobierno 
 
II. EVOLUCION DE LA POLITICA COMERCIAL, 3) LA MAYOR RELACIÓN 
 COMERCIAL DEL MUNDO: CANADÁ - ESTADOS UNIDOS. Párrafos 48 y 57  
 
El informe del Gobierno de Canadá  sostiene que “Las exportaciones de servicios alcanzaron un total de 
35.900 millones de dólares en 2005, y las importaciones fueron de 45.300 millones de dólares” asimismo señala que  “… En virtud del TLCAN, tamb ién ha aumentado el come rcio de servicios del 
Canadá con los Estados Unidos y México (de 46.400 millones de dólares en 1994 a 82.700 millones en 
2004), y se han registrado asimismo efectos positivos en las inversiones.  Las inversiones extranjeras 
directas en el Canadá ascendieron a 415.600 mill ones de dólares en 2005, procediendo más del 64 por 
ciento de los interlocutores del TLCAN”.  
Pregunta 
 Podría la delegación de Canadá ampliar la siguiente información 
 Cuanto representa en el PIB de Canadá el interc ambio del comercio de servicios con los Estados 
Unidos?  Cual sería la desagregación del sector en su intercambio con Estados Unidos y México?.  
 
b) Iniciativas comerciales bilaterales, Página 666, párrafo 65. 
 
“El Canadá y Chile también llegaron a un acuerdo sobre compromisos en materia de transparencia ampliados para ciertas adquisiciones para las cual es no había compromisos de acceso a los mercados.  
Además, desde su último examen de las políticas come rciales, el Canadá se ha reunido con Chile en 
varias ocasiones para examinar la elaboración de di sciplinas relativas a los servicios financieros”. 
 
Pregunta 
 
En la elaboración de las disciplinas relativas a los servicios financieros con Chile, ¿estos servicios 
fueron examinados en relación con el  comercio de servicios transfr onterizo, o con las inversiones o 
alguna otra modalidad de prestación?, Se tiene planes  para redactar un capítulo  específico de Servicios 
Financieros o cual será el formato que se dará a los compromisos que se asuma en esta materia?  
Párrafo 66, página 2. 
 
..…  “El ALCCI contiene disciplinas sobre cont ratación pública, pero no abarca el comercio 
transfronterizo de servicios o inversiones”.   WT/TPR/M/179/Add.1 
 Page 67 
 
 
Pregunta 
 
Por qué dentro del acuerdo del ALCCI no fue incl uido o no se considero el capítulo de comercio 
transfonterizo o de inversiones, existen medidas re strictivas sobre el comercio de servicios en este 
acuerdo? 
 
Informe de la Secretaria 
 
POLITICAS COMERCIALES POR SECTORES, página 2, párrafo 9  
 El informe de la Secretaría señala que “Prácticamen te todas las profesiones están reglamentadas a nivel 
provincial o territorial y se fortalecieron las medi das encaminadas a facilita r la movilidad de las 
profesiones entre las provincias y los territorios.  Aunque, en algunos casos, siguen aplicándose prescripciones en materia de ciudadanía y resi dencia, se han suprimido algunos obstáculos”. 
 Pregunta 
 
¿Existe algún porcentaje de participación extran jera permitido en la prestación de servicios 
profesionales?. ¿Cuáles son los requisitos exigidos o las restricciones existentes para el ingreso de 
profesionales extranjeros en Canadá?   CAPITULO II RÉGIMEN DE LA POLÍTICA COMERCIAL, 1) VISION GENERAL, párrafo 2.  
 
El informe menciona que “Canadá emprende inic iativas regionales y bilaterales en materia de 
relaciones preferenciales de comercio e invers iones. El Canadá eximió de los compromisos 
preferenciales de liberalización determinadas líneas ar ancelarias cuya oferta esta regulada así como las 
actividades culturales”   
Pregunta 
 
1. Podría la delegación del Ca nadá ampliar la información pr ecisando qué se entiende por “oferta 
regulada” y como se aplica en este contexto? 
 2. ¿porqué el Canadá incluyó en el retiro de lo compromisos preferenciales de liberalización a las 
actividades culturales? A que tipo de actividad es culturales se refiere el párrafo citado? 
 2) MARCO JURIDICO GENERAL, párrafo 8 
 
Según el informe en el Canadá debido a su marc o jurídico y constitucional “…frecuentemente se 
requiere la cooperación de las provincias para aplicar tratados internacionales”  
Pregunta 
 
¿Podría la delegación de Canadá explicar en que consiste esta “cooperación” entre las provincias y el 
poder ejecutivo federal para la aplicaci ón de tratados internacionales? 
 
5) RELACIONES INTERNACIONALES, inciso ii) Acuerdos comerciales preferenciales y 
 otros acuerdos, párrafo 60.  
Se menciona que “El Canadá ha celebrado un debate exploratorio  acerca de posibles negociaciones 
sobre libre comercio con la República Dominicana , los miembros de la Comunidad Andina y los 
miembros de CARICOM” 
 WT/TPR/M/179/Add.1 
Page 68  
 
Pregunta 
 
¿Cuales son los resultados del debate explorat orio? Cuales son los ámbitos de negociación que 
interesaría a Canadá tener con la Comunidad Andina? 
 III. POLÍTICAS COMERCIALES POR MEDIDAS, 2) MEDIDAS QUE AFECTAN  DIRECTAMENTE A LAS IMPORTACIONES, iv) Aranceles, párrafo 46. 
 
El informe señala que “los productos lácteos, las aves de corral, los huevos, el azúcar refinado y la 
mayor parte de los textiles, prendas de vestir y el calzado no reúne las condiciones requeridas para el 
otorgamiento de trato arancelario preferencial”  
 
Pregunta 
 
¿Podría la delegación de Canadá aclarar cuales son las condiciones requeridas para que dichos 
productos sean parte del trato arancelario preferencial? 
 
Inciso ii) Incentivos y otras medidas de ayuda a las empresas, b) sobre Medidas y programas 
federales, párrafo 199 . 
 El Informe menciona que “el Gobierno federal otor ga una serie de créditos y deducciones fiscales con 
respecto al impuesto de sociedades. En el Presupuesto de 2006 el Gobierno introdujo también un 
crédito fiscal de hasta 2.000 dólares canadienses pa ra las empresas que contrataran aprendices, en el 
marco de un conjunto de medidas destinadas a pr omover una mayor capacitación y formación de la 
fuerza laboral”.  Pregunta 
 
¿Cuales son los alcances del Programa de Capacit ación y formación Laboral y si el Gobierno de 
Canadá ha efectuado alguna evaluación del impacto en el mejoramiento de la calidad y capacidad de 
los Trabajadores?  CAPÍTULO IV, POLITICAS COMERCIALES POR SECTORES, Inciso 2, párrafo 115. 
 
El Informe menciona que, “en 2005, la CCRT emitió una decisión por la que se obligaba a todas las 
empresas canadienses de telefonía inalámbrica a que hicieran portable el número inalámbrico en la mayor parte del Canadá”.  Pregunta 
 
¿Esta norma ha sido aplicada inclusive a los operado res que reportan no factibilidad técnica para la 
portabilidad numérica? Y de ser afirmativa la respuesta ¿Se han considerado excepciones a estos 
operadores en cuanto a plazos para la adecuación a la norma? 
 
III. POLÍTICAS COMERCIALES POR MEDIDAS, 3) MEDIDAS QUE AFECTAN 
 DIRECTAMENTE A LAS EXPORTACIONES, iv) Financiación, seguros y garantías a  las exportaciones, Parágrafo 156 y 158. 
 El Informe precisa que “El mandato de EDC es apoyar y fomentar, directa o indirectamente, el 
comercio de exportación del Canadá y la capacida d del país para participar en ese comercio y 
aprovechar las oportunidades comerciales internaciona les. Ofrece diversos programas de financiación, 
seguros y garantías relacionados con transacciones de exportación” 
  WT/TPR/M/179/Add.1 
 Page 69 
 
 
Pregunta 
 
Podría la delegación canadiense señalar ¿cuáles son lo s principios en los que se basan al otorgar estos 
créditos para que no sean considerados subvenciones?   IV POLÍTICAS COMERCIALES POR SECTOR ES, 2) AGRICULTURA, iv) Subvenciones 
a la exportación, parágrafo 44.  
 
El Canadá adoptó compromisos en materia de redu cción de las subvenciones a la exportación conforme 
al Acuerdo sobre la Agricultura de la OM C en relación con 11 grupos de productos. 
 
Pregunta 
 
Pondría explicar porque las subvenciones a la e xportación se han incrementado en un monto del 9% 
más que la gestión anterior siendo que la Agenda Implícita prevé la reducción y en su caso eliminación 
de las medidas que distorsionan el comercio internacional. 
 
VIET NAM 
 
1. Canada's regulation No. D-98-08 requires that importers produce certificate for wood-
packaging to be imported into Canada.  Viet Nam is  of the view that if the certificate issued by 
exporters countries authorities is acceptable that w ould enhance the certainty of business environment. 
Viet Nam thanks Canada for any informa tion that can be provided on this issue. 
 2. Viet Nam business enterprises express concern that difference requirements of labelling and 
marking are applied by different Canadian provinces.   Viet Nam would be grateful if Canada can 
provide information on any plan to improve the situ ation toward uniform application in this area. 
 
 WT/TPR/M/179/Add.1 
Page 70  
 
RESPONSES PROVIDED BY CANADA TO WRITTEN QUESTIONS 
RECEIVED PRIOR TO 7 MARCH 2007 
 
REPORT BY THE SECRETARIAT (WT/TPR/S/179) 
 
SUMMARY OBSERVATIONS 
 
[Honduras Question 2] 
 
Question 2 (a):   The summary of observations on page vii includes the following: [ translation ] 
“Canada’s trade regime has not changed significantly since it was last reviewed in 2003.  Limitations 
on foreign investment persist in such sectors as telecommunications, audiovisual services and air and 
marine transport.”  Could Canada expand on what the limitations to investment in these sectors are?  What are the 
limitations in the telecommunications sector? 
 ANSWER:   As indicated in Table II (FDI) on page 6 - 7 of the Secretariat report Trade Policy regime:  
Framework and Objectives (4) Foreign Investment Re gime, foreign ownership of Canadian airlines is 
limited to 25% of voting shares. As noted in the WTO Secretariat corrigendum, Canada does not 
maintain limitations to foreign investment in mar itime transport.  (See also Colombia Question 56 
below). 
 In terms of audiovisual services, the Investment Ca nada Act requires that foreign investments in the 
production, distribution and exhibition sector of the film and video industries be compatible with 
national cultural policies.  
 
As part of the measures to support an indigenous Canadian distribution industry, the government has 
also announced Investment Canada policy on foreign investment in the Canadian film distribution 
sector:   
• takeovers of Canadian owned and controlled distribution businesses will not be allowed; 
• investments to establish new distribution bu sinesses in Canada will only be allowed to 
importation and distribution activities related to pr oprietary products (the importer owns world 
rights or is a major investor); 
• indirect and direct takeovers of foreign di stribution businesses operating in Canada will be 
allowed only if the investor undertakes to re invest a portion of its Canadian earnings in 
accordance with national and cultural policies; 
 All applications to Investment Canada made afte r February 13, 1987 are subject to this policy. 
 
Canada's Telecommunications Act requires that te lecommunications common carriers be Canadian 
controlled and limits direct invest ment to 20% of the voting shares.  The limit on the voting shares for 
holding companies is 33 and 1/3%.  The maximum investment by foreign entities in an operating company is 46.7% (i.e. 20% of the operating co mpany and 26.7% of the holding company (33 and 
1/3% of the remaining 80%). Such carriers must be controlled in fact by Canadians. 
 Question 2 (b):   How do Canada’s WTO commitments fit in with the fourth telecommunications 
protocol?  ANSWER:   Canada has accepted the Fourth Protocol to the General Agreement on Trade in Services. 
Canada’s specific commitments in basic telecomm unications are given in Canada’s Schedule of 
Specific Commitments, Supplement 3, dated 11 April 1997.  WT/TPR/M/179/Add.1 
 Page 71 
 
 
Question 2(c):  Is Canada prepared to consolidate or eliminate this restriction as part of the Doha 
negotiations?  ANSWER:  In March 2006, an independent panel of experts commissioned by the Government to 
review Canada's telecommunications policy and regul atory framework released its final report.  The 
report included 127 recommendations to modernize Canada’s telecommunication regime, including a 
proposal to amend the restrictions on foreign direct i nvestment (FDI) in the sector.  The Government is 
examining the potential benefits a nd implications of increasing forei gn investment, along with all the 
recommendations of the report, but no decision has been made to amend Canada’s telecommunications 
FDI regime. 
 
(6) SECTORAL POLICIES 
 
[Honduras Question 3] 
 Question 3 (a):   The summary of observations, paragraph 25, page xi, says: [ translation ] “In the 
marine transport sector, cabotage is still reserved fo r Canadian-flagged ships, although foreign ships 
are permitted (in Canadian waters).”  Could Canada expand on how foreign ships are permitted access?  
ANSWER:   Foreign ships may only participate in Canada 's coastwise trade if no Canadian registered 
duty-paid ship is available or capable of performing the activity.    Question 3 (b):   What limitations do foreigners have for providing the service? 
 
ANSWER:   At the same time, Canada allows foreign ownership of Canadian-registered ships.  As 
such, foreign ship owners can also provide these services in Canada.    The Canada Shipping Act permits companies that are incorporated in countries other than Canada to 
own ships on the Canadian register.   
 
The only caveats are that there be some form of  presence in Canada for accountability purposes (e.g. 
liability).  In this respect, the Act provi des the ship owner with three choices: 
 - a subsidiary of the company that is incorporated in Canada,  - an employee or director in Canada of any branch office of the company in Canada, or 
 - a Canadian ship management company. 
 
[Honduras Question 4] 
 
Question:   The summary of observations, paragraph 26, page xi, says: [ translation ] “Practically all 
professions are regulated. Although citizenship and r esidency restrictions still apply in some cases, 
some obstacles have been eliminated in recent years.”  Question 4(a)  Could Canada give more  details on the obstacles? 
Question 4(b)  Are all or only some professions subject to  the residency and citizenship requirement? 
Question 4(c)  What obstacles have been eliminated? 
Question 4(d)  How do they affect the commitments in Mode 4? 
 ANSWER:   Canada has listed limitations for sub -federal residency and permanent residency 
requirements in a number of professions, including foreign legal consultancy services; accounting, 
auditing and bookkeeping services; architectural serv ices; engineering and integrated engineering 
services; and urban planning and landscape architectur al services.  These limitations apply to the cross-
border supply of services (Mode 1) and to the tem porary entry of business persons (Mode 4), however, WT/TPR/M/179/Add.1 
Page 72  
 
the specific requirements vary by profession as noted  in Canada’s General Agreement on Trade in 
Services (GATS) Schedule of Commitments.  Canada  has consistently undertaken consultations with 
relevant professional associations to review the ex tent of liberalization undertaken since the Uruguay 
Round of GATS negotiations and whether there is scope  for additional liberalization in the context of 
the Doha Round.  Through its initial and revised GATS offers, Canada has removed a number of 
provincial/territorial citizenship a nd residency requirements in the professional services sectors in line 
with domestic liberalization that has occurred.  [List below]  
 These improvements are not reflected in the Trad e Policy Review as only Canada’s Uruguay Round 
commitments are discussed. Improvements to Ca nada’s GATS Schedule of Commitments in the 
professional services sector result from liberalization at the sub-federal level that has occurred during 
the course of the Doha Round.  Canada continues to  consult with its national professional associations 
and provincial and territorial governments with resp ect to removing additional residency requirements.  
 
List of sub-federal limitations that have been  removed from Canada’s GATS Schedule in initial 
and revised offers:  
Foreign Legal Consultants (advisory services on foreign and public international law) 
 - Removal of permanent residency requirem ent for accreditation (Prince Edward Island) 
 - Removal of citizenship requirement (Quebec)  Accounting, auditing and bookkeeping services 
 - Auditing
: removal of requirement for a commercial presence (Nova Scotia) 
 - Auditing : removal of citizenship requirement  for accreditation (Manitoba, Quebec) 
 - Auditing : removal of residency requirement fo r accreditation (Ontario, Prince Edward 
  Island) 
 - Licensed Public Accountants : removal of residency requirement for accreditation 
  (Manitoba)   
Architectural services 
 - Architects
: removal of citizenship requirement for accreditation (Quebec) 
 - Architects : removal of residency requirement for accreditation (New Brunswick) 
 
Engineering and integrated engineering services 
 - Consulting Engineers : removal of requirement for commercial presence for  
  accreditation (Manitoba)  - Engineers
: removal of permanent residency requirement for accreditation  
  (Newfoundland and La brador, Nova Scotia) 
 - Engineers : removal of citizenship requirement for accreditation (Quebec) 
  
Urban planning and landsca pe architectural services 
 - Community/Urban Planning : removal of citizenship requirement for use of title  
  (Quebec) 
 
[Colombia Question 56] 
 
Question:   Paragraph 8 says that in the marine transportation sector, cabotage is reserved for Canadian-
flagged ships, although foreign ships are allowed acces s if no suitable ship registered in Canada is 
available.  In the air transportation sector, the growth of low-cost airlines has brought increased 
competition.  However, foreign-owned airlines cannot  provide cabotage services and foreign ownership 
of Canadian airlines is limited to 25 per cent of voting shares and by flexible reviews of de facto 
control.  
What do the reviews of de facto control applied to  Canadian airlines with foreign ownership involve?  WT/TPR/M/179/Add.1 
 Page 73 
 
 
ANSWER:   The question refers to paragra ph 25 of the Summary Observations. 
 The Canada Transportation Act  (CTA) does not define what constitutes “control in fact” but mandates 
the Canadian Transportation Agency (Agency) to  undertake a comprehensive case-by-case analysis, 
that is reflected in case precedents law, of all aspects of  an investment to ensure  that control rests with 
Canadians.  Generally, control in fact can be vi ewed as the ongoing power or ability to determine or 
decide the strategic decision-making activities of an en terprise.  It also can be viewed as the ability to 
manage and run the day-to-day operations of an enterprise.  When determining where control in fact lies, th e Agency carefully examines all actual and proposed 
business and other relationships betw een the various shareholders and between the shareholders and the 
company whose ownership is under review.  All ac tual and proposed operational, managerial and 
financial relationships are considered.  The intent and ability of individual shareholders or others to 
influence and control are also considered.  Ag reements, such as shareholder agreements and 
commercial contracts between the shareholders and the company are of particular importance. 
 
Canada does not have a specified limit on the total am ount of equity that foreign interests can hold in 
Canadian air carriers, save the 25 percent limit on voti ng interests and the statutory requirement that a 
Canadian air carrier be “controlled in fact” by Cana dians.  Other forms of foreign equity could include 
non-voting or variable voting shares.  The Canadian Transportation Agency is mandated to ensure that 
Canadian air carriers remain under the control of Canadians. 
 
I.  ECONOMIC ENVIRONMENT 
(2) RECENT ECONOMIC DEVELOPMENTS 
 
[Switzerland Question 1] 
 Question on Para. 9 :  Canada’s economic performance has been impressive for some years thanks to 
booming commodity prices and sound economic policies.   However, raising productivity growth seems 
to be a major challenge for Canada.  The report men tions a lack of capital deepening as an explanation 
for the low productivity growth.  Do the Canadian  authorities share this analysis?  How do the 
Canadian authorities reconcile the need to undertak e a series of reforms (as suggested by the OECD 
listing) with the fact that not only the activity is buoyant, but also that resource-rich provinces benefit 
from windfall gains, which releases pressure on public finance?   ANSWER:  Canada has had one of the largest incr eases in living standards between 1996 and 2005 
among industrialized countries.  Moreove r, Canada’s living standard is one of the highest in the world.  
Canada is a country with many strengths for th e foundation of success in today’s global economy: 
 
• Canada’s job creation has been the strongest in the G7. 
• Canadians are highly educated and Canada leads in primary scientific research. 
• Canada is in a solid fiscal position. 
• Canada is an emerging energy superpower. 
 At the same time, Canada’s productivity perfo rmance has improved significantly since 1996 after 
decades of slow growth in productivity.  This pick -up in productivity growth was one of the fastest 
turnarounds among major industrialized countries, surpassed only by that of the United States. 
 However, this marked improvement was not suffici ent to place Canada among productivity leaders.  
Canada’s productivity performance still remains lower than in many other OECD countries.  Indeed, 
Canada’s productivity is lower and is growing at a lower pace that in most other industrialized 
countries. 
 WT/TPR/M/179/Add.1 
Page 74  
 
It is difficult to come up with a comprehensive list of factors that underline Canada’s weak productivity 
performance since it is often a host of factors and th eir interactions influence productivity growth.  
Nonetheless, Canada’s productivit y performance may be related to lower investments on average in 
research and development, and machinery and equi pment by Canadian businesses compared to their 
OECD counterparts.  Canadian businesses’ participati on in workplace training is also lower than other 
leading OECD countries. 
 In this regard, the Government of Canada’s Advantage Canada in itiative is a strategic, long-term 
economic plan designed to help Canadians improve their quality of  life and make Canada a world 
leader for today and future generations. 
 
The plan is rooted in the realities of global comp etition and Canada’s existi ng strengths and economic 
challenges.  While the plan is designed to redu ce barriers to investment and help Canadians and 
Canadian businesses build on their current strengt hs, it also recognizes the importance of making 
strategic investments to build a solid and sustainable foundation for the economy. 
 
Advantage Canada is focused on creating five Cana dian advantages that will help us improve our 
quality of life and succeed on the world stage:  Tax Advantage: 
• Canada’s Tax Advantage will reduce taxes for a ll Canadians and establish the lowest tax rate 
on new business investment in the G7. 
Fiscal Advantage: 
• Canada’s Fiscal Advantage will eliminate Canada ’s total government net debt in less than a 
generation, creating a strong foundation on which to build sustainable prosperity. 
Entrepreneurial Advantage: 
• Canada’s Entrepreneurial Advantage will reduce unnecessary regulation and red tape and 
lower taxes to unlock business investment .  By building a more competitive business 
environment, consumers will get goods at lowe r prices and Canadian businesses will be better 
equipped for global success. 
Knowledge Advantage: 
• Canada’s Knowledge Advantage will create the b est-educated, most-skilled and most flexible 
workforce in the world. 
Infrastructure Advantage: 
• Canada’s Infrastructure Advantage will create m odern, world-class infrastructure to ensure the 
seamless flow of people, goods and services acros s our roads and bridges, through our ports 
and gateways, and via our public transit. 
 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
 (1) OVERVIEW 
 
[Honduras Question 5] 
 
Question 5 (a):  Page 12, paragraph 3, says: [ translation ] “Canada maintains a policy of national 
treatment for foreign direct investment (FDI), subject to specific restrictions by sector related to fishing, mining and energy, air transport, telecommunications and cultural activities.” 
 
Could Canada expand on the types of r estriction to which FDI is subject? 
 ANSWER:   Many of the restrictions to which Forei gn Direct Investment (FDI) is subject, including 
those for fishing, uranium mining, and air transport, have been outlined in Table II (FDI) on page 6 - 7 
of the Secretariat report Trade Policy regime:  Fr amework and Objectives (4) Foreign Investment  WT/TPR/M/179/Add.1 
 Page 75 
 
 
Regime.  As noted in the WTO Secretariat corri gendum, Canada does not maintain limitations to 
foreign investment in maritime transport.  
Telecommunications: 
Canada's Telecommunications Act requires that te lecommunications common carriers be Canadian 
controlled and limits direct invest ment to 20% of the voting shares.  The limit on the voting shares for 
holding companies is 33 and 1/3%.  The maximum investment by foreign entities in an operating company is 46.7% (i.e. 20% of the operating co mpany and 26.7% of the holding company (33 and 
1/3% of the remaining 80%).  Such carriers must be controlled in fact by Canadians.  Cultural activities: 
Broadcasting:  Under various statutes, broadcasting licences may not be granted to companies that are 
not Canadian owned and controlled according to the same share and board restrictions applied to 
telecommunication companies (see above);  
Book publishing and distribution:  Direct acquisition by non-residents of Canadian-controlled 
businesses is not normally allowed.  Foreign investme nts in new businesses are considered favourably 
provided the investment is through a joint venture w ith Canadian control.  Indirect acquisitions are 
allowed, subject to a net benefit test
2; 
 Newspaper, magazines, and periodicals:  For newspapers and magazines, the net benefit test is 
applicable. For periodicals, acquisitions of Cana dian-controlled periodical publishing businesses is not 
permitted. Foreign investments in new businesses are c onsidered favourably subject to net benefit and, 
in particular, majority original content in the publication;  Film distribution:   Acquisition of Canadian-controlled dist ribution companies by non-Canadians is 
not permitted.  However, foreign investment is perm itted if it is through a joint venture with Canadian 
control. Foreign investments to establish new dist ribution businesses in Canada will only be allowed 
for importation and distribution activities related to proprietary products (the importer owns the world 
rights or is a major investor);  Sound recording industry:   The net benefit test is applicable; 
 
Music publishing:   The net benefit test is applicable. 
 Question 5 (b):  Do the restrictions on investment in the telecommunications sector comply with 
Canada’s commitments in the fourth protocol?  
 
ANSWER:   Canada’s limitations on investment in  the telecommunications sector are given in 
Canada’s Schedule of Specific Commitment s, Supplement 3, dated 11 April 1997. 
 Question 6 (a):   Page 12, paragraph 3, says: [ translation ] “foreign acquisitions above a certain limit 
are subject to review to ensure that they are for Canada’s "net benefit".” 
 
Can Canada expand on the type of review?  
                                                     
 
2 The Investment Canada Act specifies  the factors that must be taken into account in assessing the "net 
benefit" criterion.  These factors include the investment 's effect on:  economic activity, employment, resource 
processing, exports, the use of Canadian products, productivity, efficiency, technological development, product 
innovation and variety, and competition.  They also comprise the investment's compatibility with national 
industrial, economic, and, where applicable, cultural policie s and "the degree and significance" of participation by 
Canadians in the business resulting from the investment. WT/TPR/M/179/Add.1 
Page 76  
 
ANSWER:   For most foreign acquisitions, the thres hold for review for 2007 is $281 million.  The 
review threshold is based on the assets of the Canadi an business.  There are some minor exceptions to 
this threshold.  Where the Canadian business to be acquired is a cultural business, a transportation 
service business or a financial service not covered by the Bank Act, a threshold of $5 million for direct acquisitions and $50 million for indirect acquisitions applies.  The same lower thresholds apply where 
the buyer and seller of the Canadian business in  Canada are not from WTO member countries. 
 Where the acquisition is reviewable, the investor set s out its plans for the Canadian business to address 
the factors of net benefit set out in  Section 20 of the Investment Cana da Act.  A brief assessment of the 
plans is made and a decision is taken by the Minister of Industry. 
 
Question 6 (b)  What authority carries out the review? Does it refer to tests of economic necessity? If 
so, how does this relate to the commitments unde r the General Agreement on Trade in Services 
(GATS)?  
ANSWER:   The Investment Canada Act is the law th at sets out what types of investments are 
reviewable.  The factors of net benefit to Canada are set out in Section 20 of the Act.  Canada’s 
approach is consistent with its WTO co mmitments, including those under the GATS. 
 
[Colombia Question 1] 
 Question 1:   The Secretariat’s report, (para 1) says that  Canada’s trade and investment policy regime 
has not changed significantly since 2003.  It is based  on shared federal and provincial jurisdiction and 
involves periodic consultations between the fe deral government, the provinces, industry, non-
governmental organizations and public-interest groups , and the general public.  It also includes an 
agreement to identify and reduce interprovincial barrier s to trade and investment.  Canada has said that 
its growth prospects depend on opening world mark ets and a stable, predictable and transparent 
business environment.  Do the federal government and the provinces have the same perspective on Canada’s trade and 
investment policy regime or do they disagree on foreign investment?  
ANSWER:  On the overwhelming majority of issues,  the federal government and the provincial 
governments agree on Canada’s trade and investment policy regime.  The federal government consults 
with the provinces on all major issues.   
[Colombia Question 2] 
 
Question 2:   Are there any provincial requirements or rest rictions for foreign investment that do not 
exist at the federal level?  ANSWER:   Yes, there are some very minor restrictions. 
 [Colombia Question 3] 
 
Question 3:  Paragraph 3 says that Canada gives national treatment to direct investment foreign, 
subject to specific restrictions in sectors relate d to fishing, mining and energy, air transport, 
telecommunications and cultural activities.  Foreig n acquisitions over a certain limit are subject to 
review to ensure that they are for Canada’s “net benefit.” 
 What is the maximum amount of a foreign acquisition?  ANSWER:  The federal government places no limits on the percentage of shares of a company that a 
non-Canadian wishes to acquire nor does it place li mits on the total value of the acquisition.  WT/TPR/M/179/Add.1 
 Page 77 
 
 
[Colombia Question 4] 
 
Question 4:   What does the review to ensure Canada’s “n et benefit” from foreign investment involve?  
 ANSWER:   Under the Investment Canada Act a small num ber of foreign investments are reviewable.  
Non-Canadian investors that are acquiring control of a Canadian business that is reviewable submit 
their plans for the Canadian business to the governme nt for review.  The government assesses the plans 
against the factors of ‘net benefit’ to Canada set out in section 20 of the Act.  Discussions may take 
place between the investor and government officials to clarify the investor’s plans.  When the review is 
complete, a summary report is sent to the Minister of Industry for a decision. 
 
[Colombia Question 5] 
 
Question 5:  Does this review apply objective criteria to estimate the “net benefit”?  If so, what are 
they?  
 
ANSWER: Yes, the factors of net benefit to Canada are cl early set out in Section 20 of the Investment 
Canada Act.  No other issues can be taken into account.  
[Colombia Question 6] 
 Question 6:   What happens if these foreign acquisitions do not result in “net benefit” according to the 
review?   ANSWER:  If the acquisition is not likely to be of net benefit to Cana da, ultimately it cannot proceed.  
However, the intent of the Investment Canada Act is not to block foreign acquisitions, but to ensure 
that they benefit Canada. 
 
(2) GENERAL LEGAL FRAMEWORK 
 [Honduras Question 7]   
Question 7 (a) on the structure of the judicial authority in Canada (Page 13 Spanish version, page 11 English version, para. 6. Could Canada explain what quasi-judicial tribunals are? 
 ANSWER:   Quasi-judicial or administrative tribunals  are specialized bodies, established by statute 
(federal or provincial), that exercise judicial functions  in a specific area.  The regular courts exercise 
powers of appeal or of judicial review over such tribunals. 
 Question 7 (b):   What is their competence and jurisdiction? 
 ANSWER:   The jurisdiction of such tribunals is defined by statute. 
 
Question 7(c):   How do quasi-judicial tribunals fit into Canada’s legal structure? 
 ANSWER:   The regular courts exercise their inherent powers of judicial review over such tribunals 
(with varying degrees of deference to the specialized  expertise of the tribunal concerned).  Sometimes 
there is a right of appeal (which is broader than ju dicial review) to the regular courts from the decisions 
of the administrative tribunals. 
 
[Colombia Question 7] 
 
Question 7:   Paragraph 8 says that the federal executive alone has the power to negotiate and conclude 
international treaties.  International treaties do not apply automatically in Canadian law:  implementing WT/TPR/M/179/Add.1 
Page 78  
 
legislation may be necessary if the provisions of  domestic law are incompatible with Canada’s 
international obligations.  Responsib ility for applying provisions of international treaties falls to the 
federal government or the provincial governments,  according to the division of powers in the 
Constitution.  
What is the function and competence of the legisla tive and jurisdictional authority in negotiating and 
ratifying international treaties (especially on trade)?  ANSWER:  The negotiation of treaties and their conclu sion is the exclusive responsibility of the 
Government of Canada. 
 
[Colombia Question 8] 
 
Question 8:   If the provisions of domestic law are incomp atible with obligations under an international 
investment agreement, how long does it take the federal government and th e provinces to implement 
and apply the provisions of international treaties? 
 ANSWER:  This depends on the obligations contained in  the treaty.  It is the practice of the 
Government of Canada not to make a treaty bind ing on Canada (through ratification or other treaty 
action) until Canada's domestic legislation (federal or provincial) is in conformity with the obligations 
contained in such a treaty.  [Colombia Question 9]  
Question 9:  How are the provinces involved in fo rmulating Canada’s trade policy? 
 
ANSWER:   The various processes are accurately portray ed in Section II. Trade Policy Regime: 
Framework and Objectives, paragraph 11 of the S ecretariat Report which is reproduced below for 
reference.  “DFAIT regularly consults provinces and territories,  industry, non-governmental and public interest 
groups, and Canadians at large about trade po licy.  DFAIT has a government-to-government 
consultation programme with provinces and territori es.  The Annual Meeting of Federal-Provincial-
Territorial Trade Ministers is a consultative mechanis m that addresses international trade issues.  It can 
be complemented by annual meetings of deputy mi nisters.  Additionally, the so-called "C-Trade" 
process brings together representatives at the federal,  provincial, and territori al levels on a quarterly 
basis.” 
 
Additional information on how provinces and territories are involve d in the formulation of Canada’s 
trade policy is contained in the Government Re port, Section III Consultations and Transparency. 
Paragraph 120 in particular provides further exampl es of Canada’s intergov ernmental cooperation and 
has been reproduced below for reference.  
“Intergovernmental cooperation with Canada's pr ovinces and territories at both the political and 
officials level on trade issues is active and has pr oven to be quite effectiv e.  Federal-Provincial-
Territorial Trade Ministers meet annually to address the full range of interna tional commerce issues as 
do their respective Deputy Ministers.  Officials also  meet quarterly.  These meetings provide the venue 
for federal-provincial-territorial dialogue in areas of  shared jurisdiction, and to promote coherence in 
the programming of international commerce policies a nd activities.  The extent of intergovernmental 
inclusion in WTO matters can be seen through provin cial and territorial participation at the WTO 6th 
Ministerial Conference.  Fourteen provincial cab inet ministers and approximately 50 provincial and 
territorial officials were in attendance.  They were  kept closely informed through debriefing sessions or 
document sharing as the meetings progressed.”   WT/TPR/M/179/Add.1 
 Page 79 
 
 
[Colombia Question 10] 
 
Question 10:   What are the differences between federally registered companies and companies in 
provincial jurisdiction?  
ANSWER:   Both the federal government and the provin ces have the power to incorporate companies. 
There are some differences in the legislative frame work that might influence the decision on where to 
incorporate.  Both federal and provincial compan ies can do business throughout Canada.  However, a 
federal company has the right to do business thr oughout Canada with its corporate name.  Provincial 
companies must have their corporate names approved by a provincial registrar if they operate in a 
province other than the province in which they are incorporated.  If the name is not available, a 
provincial company cannot use its corporate name in the other province.  
[Colombia Questions 11-12] 
 
Question 11:   Is there a labour authority in Canada and how does it work at the federal level? 
 
Question 12:  Does each province have labour legislation or  does federal law apply to all provinces? 
 ANSWER (to Questions 11 & 12):   In Canada, responsibility for th e regulation of labour matters is 
divided between the 10 provinces and the federal gove rnment.  Under the Canadian Constitution, the 
division of legislative authority in Canada places mo st employees under the labour laws of the province 
in which they work.  Workers employed in manuf acturing, mining (except uranium mining), forest 
products industries, construction, education, service industries, local transportation, and the provincial 
and local government sectors all fall within provinc ial jurisdiction.  The Parliament of Canada has 
exclusive jurisdiction to pass laws dealing w ith the Yukon, Northwest Territories and Nunavut. 
However, Parliament has enacted legislation to gran t to territorial governments the power to legislate 
on property and civil rights and matters of a local and private nature.  As a result, the territorial 
governments have virtually the same legislative pow ers with regard to labour laws as have the 
provinces.  The Parliament of Canada has legislative jurisdictio n over labour in those sectors that are subject to 
federal jurisdiction.  At the federal level, labour legislation covers approxi mately 10 percent of the 
Canadian workforce and includes workers in a nu mber of key areas of the economy.  Federally 
regulated private sector industries include:  - international and interprovincial trans portation by land and sea, including railways, 
  pipelines, shipping and many truck and bus operations; 
 - airports and airlines 
 - communications and broadcasting, incl uding telecommunications and radio and  
  televisions broadcasting;  - federally chartered banks  - ports operations and longshoring  - certain federal Crown corporations 
 - industries declared by the Canadian par liament to be for the general advantage of 
  Canada such as grain handling.  At the federal level, Parliament has adopted legisla tion providing for collective bargaining in the Public 
Service of Canada and legislation that requires federally regulated employers with 100 employees or 
more to develop and implement empl oyment equity plans and programs. 
 In Canada at the federal and pr ovincial level there are labour la ws governing industrial relations, 
occupational safety and health and employment standards.  
 WT/TPR/M/179/Add.1 
Page 80  
 
(3) TRADE POLICY FORMULATION AND OBJECTIVES 
 [Colombia Question 13]  
 
Question 13:  Paragraph 16 recognizes important differences in trade and investment policies and 
practices between the federal and provincial governme nts, and among the provinces.  It says that the 
purpose of the Agreement on Internal Trade (AIT) is  to reduce and eliminate, as much as possible, 
barriers to the free movement of people, goods, services and investments within Canada and to establish an open, efficient and stable domestic mark et.  The AIT took effect in 1995, and all provinces 
and territories except Nunavut signed it. 
 
What happens with Nunavut? Is it not b ound by the AIT’s investment decisions? 
 
ANSWER:  Nunavut is not a signatory to the Agreement on Internal Trade (AIT).  The territory was 
created after the AIT was signed and came into force.  However, Nunavut has indicated its intention to 
enter into negotiations with a view to joining the AIT.  
 
[Colombia Question 13]  
 
Question 14:   What are the main differences in trade and investment policies and practices?  Do some 
provinces have more or higher barriers to investment?  If so, what are they? 
 
ANSWER:  Canada has conducted neither an  analysis of the differences in trade and investment 
policies and practices between provinces nor an inv estigation on whether investment barriers are higher 
in some provinces.  
However, a brief summary of the investment obligati ons under the AIT may be helpful.  With respect 
to investment, the AIT outlines certain obligat ions under Chapter Six (Investment) and an 
accompanying annex (Annex 608.3, Co de of Conduct on Incentives).   
 Chapter Six aims to ensure that Canadian firms are able to make business decisions based on market 
conditions rather than on discriminatory or invest ment-distorting government measures.  Signatories 
agreed to: 
 · provide non-discriminatory treatment of Cana dian businesses regardless of where the head 
office is located, where the firm is in corporated or where the owners live; 
 
· limits local presence or residency requirements as a condition of carrying on business or 
making an investment; 
 · prohibits the use of local content, local purchasing, and local sourcing requirements except in 
limited cases for regional development programs;  and 
 
· standardize corporate registration and reporting requirements which should ease the 
compliance burden for firms conducting business in more than one province or territory. 
 In addition, the Code of Conduct on Incentives (Anne x 608.3) prevents a government from “poaching”: 
giving incentives to an enterprise located in another province or territory that would directly result in 
the relocation of that operation to the government's own territory.  It also discourages the use of 
incentives which could be harmful to the econo mic interests of other parts of Canada. 
 Under this Annex, a government is prohibited from offering incentives that: 
  WT/TPR/M/179/Add.1 
 Page 81 
 
 
· entice a business to relocate in th at province or territory; or 
 
· allow a business to undercut competitors in another province or territory in obtaining a contract 
issued in Canada. 
 Governments are to refrain from providing incentiv es that would sustain uneconomic operations or 
increase capacity beyond what is warranted by market conditions. 
 
(4) FOREIGN INVESTMENT REGIME 
 
[Switzerland Question 2] 
 Question 2 (a):  Para. 22 of the Secretariat’s report indicates that foreign investment to establish a new 
business in Canada, or to acquire control of an exis ting one, is subject to notification.  Could the 
Canadian authorities indicate if there is a minimum threshold for investments to be subject to such 
notifications and, if not, if there are any plans to establish such a threshold?  
 
ANSWER:   There is no minimum threshold.  The inform ation required to complete the notification is 
very basic and is not onerous to complete.  Question 2 (b):  Para. 29 of the Secretariat’s report indicates th at Canada notified in 2002 under the 
WTO Agreement on Trade-Related Investment Measures the websites containing publications 
produced by the federal, provincia l and territorial government “in which TRIMs may be found”.  Could 
the Canadian authorities indicate in which areas, if any, they still maintain TRIMs in 2007?  
 ANSWER:  In compliance with its WTO obligations, Cana da does not maintain measures that would 
be inconsistent with the Agreement on Trade-Relate d Investment Measures (TRIMs).  However, in an 
effort to ensure transparency and meet our co mmitment under Article 6.2 of the Agreement on Trade-
Related Investment Measures Canada provided this list of publications. 
 
[Singapore Question 3] 
 
Question:  Re para 20 (page 14), the Secretariat has repor ted that although Canada is among the OECD 
countries that have liberalized fore ign investment significantly sin ce 1998, it also belongs to the group 
with the highest levels of overall restrictiveness to  FDI, as measured by the OECD’s FDI regulatory 
restrictiveness index.  
• Could Canada comment on the OECD’s findi ngs with regard to its FDI regulatory 
restrictiveness?  How has the regulatory rest rictiveness in its FDI regime impacted on FDI 
flows into Canada?  What steps, if any, is  Canada taking to liberalise its FDI regulatory 
regime?  
 ANSWER:  Canada and other countries have pointed out  the weaknesses of the OECD study and are 
not confident that it is an accurate indicator of i nvestment restrictiveness.  For instance, the study only 
included formal barriers and only examined select industries. 
 Evidence confirms that Canada’s investment po licies have a minor, if any, impact on foreign 
investment.  The inflow of FDI in 2006 was $76 billion, which is almost double the $41 billion FDI 
inflow in 2005, which was greater than the 2004 inflow.  Over 50% of Canada’s manufacturing and 
resource sectors are controlled by non-Canadians.  Using the ratio of FDI/GDP as a measure of the 
activity of foreign investors in a country, Canada  ranks second only to the UK among G-7 countries.  
 WT/TPR/M/179/Add.1 
Page 82  
 
Canada regularly reviews the few rema ining foreign investment restricti ons and is aware of the benefits 
of further liberalization.  
[Japan Question 3] 
 
Question on paragraph 27 and Table  II.1, page 16:  According to the federal government policy on 
non-resident ownership in the uranium mining sector, the investment in uranium mining in Canada by 
foreign investors should fulfill either of the following: 
i) the level of resident ownership of individual uranium-mining properties exceeds 51 per cent at the 
stage of first production; 
ii) if i) is not the case, it can be clearly establishe d that the project is, in fact, "Canadian-controlled," 
as defined in the Investment Canada Act; or 
iii) if neither i) nor ii) are the case, it can be demo nstrated clearly and approved by the Canadian 
Government that Canadian partners cannot be found. 
 
In the case that foreign investors lead a uranium mini ng development, it usually fo rces investors to take 
a huge risk at a great cost, and endure a longer period of time.  Nevertheless, thanks to the Canadian 
policy mentioned above, Canadian enterprises could eas ily invest in the development without bearing a 
risk from the project, at the stage when it is obvious that the development would have succeeded.  These are regarded as the significant indeterminate fact ors for foreign investors to invest in uranium 
mining developments in Canada.  Japanese investor s share the same concerns with other foreign 
investors. 
 In this regard, we would like Canada to take into consideration the revision of this policy. 
 ANSWER:  We believe that the current set of regulations  has been working well and, as such, Canada 
has no plans at this time to review or revise this policy. 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 16] 
 
Question:   There are many sectors in Canada’s economy, such as energy, mining, air transport, book 
publishing and distribution, periodicals publishi ng, and telecommunications, in which foreign 
ownership is restricted.  
Does Canada have any plans to lift or loosen these r estrictions in order to promote foreign investment 
while at the same time enhancing domestic competitiveness? 
 
ANSWER:   Canada regularly reviews its few remaining fo reign investment restrictions and is aware of 
the benefits of further liberalization. 
 
[Colombia Question 15] 
 
Question:   According to paragraph 21, the Canada I nvestment Act governs the establishment of new 
foreign companies and acquisitions of Canadian compan ies.  Federal and provincial laws also apply to 
investment in particular sectors.  Is there any inconsistency between the Canada Inve stment Act and federal a nd provincial laws?  If so, 
in what sectors?  
ANSWER:   In general, there are no inconsistencies be tween federal and provincial laws.  If under an 
Investment Canada Act review it is  found that provincial regulations are involved, the Government of 
Canada consults with the rele vant provincial officials.  
  WT/TPR/M/179/Add.1 
 Page 83 
 
 
[Colombia Question 16]  
 
Question:  Paragraph 24 says that investments in particular cultural sectors below certain minimum 
levels subject to review can still be  reviewed if the Governor in Counc il considers a review to be in the 
"public interest" and issues a decree to this effect on the recommendation of the Minister of Canadian 
Heritage.  Within 21 days of notification, the inter ested investor must be informed that a review will 
take place.  The cultural sectors subject to this pr ovision are listed in Schedule IV of the Canadian 
investment regulations.  What are the criteria for determining the “public  interest” which is the basis of the review?  
 
ANSWER:  Section 15 of the Investment Canada Act  allows the Governor in Council, on the 
recommendation of the Minister, to issue an order to  review an investment in certain cultural sectors 
that falls below the review thresholds, as described on pp. 14-15 of the Secretariat Report, on the basis 
that it is "related to Canada's cu ltural heritage or national identity". 
 
The government considers cultural heritage to be an  important element of public policy that warrants 
special treatment under the investment regime.  Busi nesses that are considered cultural are defined in 
the Investment Canada Act  as those businesses that carry on an y of the following activities: 
  - the publication, distribution or sale of books, magazines, periodicals or newspapers in 
  print or machine readable form; 
 - the production distribution, sale or exhibition of film or video recordings;  - the production, distribution, sale or exhibition of audio or video music recordings;  - the publication distribution or sale of mu sic in print or machine readable form. 
 
[Colombia Question 17]  
 
Question:   Paragraph 28 says that in some provinces and the Yukon, foreign ownership of land is 
regulated, especially with respect to rural farm and recreational properties.  According to the Canadian 
authorities, exceptions to provincial regulations on foreign ownership are common.  The provincial and 
federal governments can set limits on fore ign participation in privatization. 
 
What are these exceptions to provincial and federal regulations on  foreign ownership? 
 
ANSWER:  Exceptions to provincial and territorial regul ations on foreign ownership are made on a 
case by case basis, and are dependent on the specifics of each situation.  Any such exceptions would be 
fully compliant with Canada's oblig ations under international treaties. 
 
[Colombia Question 18]  
 
Question:  For what percentage of property in Ca nada is foreign investment restricted? 
 
ANSWER:  The exact percentage of property in Canada s ubject to foreign investment restrictions has 
not been calculated, nor is there an intention to  do so.  Provinces and territories which maintain 
regulations on foreign land ownership do so in a tr ansparent manner, and detailed information is readily 
available on their websites.  WT/TPR/M/179/Add.1 
Page 84  
 
(5) INTERNATIONAL RELATIONS  
(i) WTO  [Brazil Question 4] 
 Question:  In Chapter II, paragraph 36 and table AII.2,  it is noted that  Canada has not fulfilled 
obligations regarding notifi cations, including with regard to state- trading enterprises (in this case, the 
last notification was made in 2002).  What are the reasons for non-notification? 
 
ANSWER:  Canada is in the final stages of prepari ng its notification for 2003 and will submit the 
notification as soon as possible. 
 
(ii) Preferential trade agreements and other arrangements 
 
[EC Question 7] 
 
Question on Paragraph 49 of the WTO Secretariat Report:  What is the basis under WTO rules for 
the bilateral preferential agreements with Australia and New Zealand?   ANSWER:  The 1960 Trade Agreement between Canada a nd Australia, which was last amended in 
1973, and the 1982 Agreement on Trade and Eco nomic Co-operation betw een Canada and New 
Zealand provide for a continuation of preferential tariff access on a range of goods specified in the 
bilateral agreements that Cana da signed with Australia and Ne w Zealand in 1931 and 1932, 
respectively.  These agreements entitle certain impor ts from Australia and New Zealand to preferential 
tariff treatment, including those products eligible for the British Preferential Tariff (e.g. certain textiles 
and clothing, ores and metals, and non-electrical mach inery) in addition to certain animals and products 
thereof, beverages and spirits, and dairy products.  As the basis for these agreements pre-dates the 1947 
General Agreement on Trade and Tariffs (GATT) a nd the parties involved are included in the listed 
territories of Annex A of the GATT, the preferen ces provided for under the agreements are expressly 
allowed under Article I, Paragraph 2(a) of the GATT.   Further details on these agreements may be  obtained from the following Web sites: 
http://www.treaty-accord.gc.ca/View Treaty.asp?Treaty_ID=102918 
http://www.treaty-accord.gc.ca/View Treaty.asp?Treaty_ID=102918 
 
[EC Question 8] 
 
Question:  What are the products in which such preference s are granted, how much are they worth and 
how much of Canada's trade with each of these partners is covered by them?  
 ANSWER:  The products for which such preferences are gr anted, including the applicable tariff rates 
of customs duty, are listed in Cana da’s Customs Tariff.  The preferen tial tariff rates applicable to goods 
originating in Australia are denot ed by “AUT”, while the preferentia l tariff rates applicable to goods 
originating in New Zealand are denoted by “NZT”.  This information is available on the Web site of 
the Canada Border Services Agency at: http://www.cbsa-asfc.gc/general/publications/tariff2007/01-
99/tblmod-1-e.html#toc.   The Australia Tariff Rate covers 691 tariff lines, wher eas the New Zealand Tariff Rate covers 711 tariff 
lines (691 of which are the same as those for Australia).   It should be noted that 119 of these tariff lines 
are now MFN duty-free.  The Australian and New Zealand Tariff Rates provide margins of preference 
over the MFN rate of:  zero percentage points for 12 3 tariff lines; ranging from 0.5 percentage points to 
10 percentage points on over 500 tariff lines; and ra nging from 10 percentage points to 20 percentage 
points on 20 tariff lines.  Specific duties also apply on a limited range of products.  WT/TPR/M/179/Add.1 
 Page 85 
 
 
As the basis for these agreements pre-dates the mu ltilateral trading system, the negotiated preferences 
have, for the most part, been eroded by subsequent tariff reductions, particularly in the Uruguay Round.  
For example, in 2006, and excluding those prod ucts which now receive MFN duty-free treatment, 
benefiting imports from Australia under the Australia Tariff Rate amounted to $138 million, with total 
imports from Australia reaching $1.6 billion (8.6% of to tal imports from Australia).  In the same year, 
and excluding those products which now receive MFN duty-free treatment, benefiting imports from 
New Zealand benefiting under the New Zealand Tariff Rate amounted to $68 million with total imports 
from New Zealand reaching $492 million (13.8 % of total imports from New Zealand). 
 
[EC Question 9] 
 Question on page 21-22, paragraph 51-52:  When does Canada expect to conclude its various 
bilateral FTA negotiations (Korea, EFTA , Singapore and Central American 4)? 
 ANSWER:  Canada’s free trade agreement negotiations  with Korea, EFTA, Singapore and Central 
America 4 are at different stages in the negotiating process.  Canada has not set a deadline for the 
conclusion of these negotiations.   
[EC Question 10] 
 
Question:  When does Canada expect to make a decisi on as to whether to launch FTA negotiations 
with the Dominican Republic, Andean community and CARICOM?  
 ANSWER:  Canada supports the goal of free trade with  the countries of the Andean Community, the 
Dominican Republic and the Caribb ean Community (Caricom).  Exploratory discussions to date 
towards potential free trade agreement negotiations ha ve been productive.  However, decisions on the 
timing of the possible launch of negotiations have ye t to be taken.  Naturally, such decisions would 
need to be taken in concert with the prospective negotiating partners. 
 
[Honduras Question 8]  
Question (page 23 Spanish version , page 19 English version):  Paragraph 43 says: [ translation ] 
“disputes concerning the investment provisions in Ch apter 11 of NAFTA are resolved by an arbitration 
process between the investor and the state.” 
 
Could Canada provide more detail on where there is more  arbitration?  Is it for investment disputes or 
for trade disputes? 
 
ANSWER:  As of March 2007, there have been 24 investme nt disputes that have gone to arbitration 
under NAFTA Chapter 11 and three trade disputes that  have gone to arbitration under NAFTA Chapter 
20.  In addition, there have been 91 completed c ases that have required bi national panel review under 
NAFTA Chapter 19 and approximately 24 further cases that remain active.  For more information, 
consult the NAFTA Secretariat’s Status Report of Panel Proceedings (www.nafta-sec-alena.org
). 
 [Honduras Question 9]   
Question on page 23 Spanish version (page 19 English version):  Paragraph 43, also says: 
[translation ] “the third dispute refers to a U.S. inv estor who alleges that measures taken by the 
Government of Ontario prevented a company from that  state using an abandoned mine in Ontario as an 
underground storage site.”  
 Could Canada indicate the measures taken by the Gove rnment of Ontario and on what legislation they 
are based? 
 WT/TPR/M/179/Add.1 
Page 86  
 
ANSWER:   The U.S. investor claims that th e Government of Ontario enacted the Adams Mine Lake 
Act (S.O. 2004, c.6) to prevent its investment (an Ontario numbered corporation) from developing an 
abandoned open pit mine as a landfill for municipal ga rbage.  There are no allegations that the U.S. 
investor intended to use this site for “underground storage”.  III. TRADE POLICIES AND PRACTICES BY MEASURE  (1) OVERVIEW  [Chile Question 1] 
 
Question on page 31, paragraph 8 (English version Page 26):  What products and markets were 
favoured by the Cdn$57 billion under the framewo rk of Export Development Canada (EDC)? 
 ANSWER:   The financial arrangements facilitated by EDC in 2005 consist of Export Financing and 
Export Insurance as broken down below.  All figures ar e in CAD millions.  Further details are available 
in EDC’s Annual Report at http://www. edc.ca/english/investor_10809.htm. 
 
Business Volume By Product
 
Export Financing        5,091 
Export Insurance 
Short-Term Insurance     41,565 
Medium-Term Insurance      8,458 G u a r a n t e e s         2 , 3 3 0
 
Total        5 7 , 4 4 4  
 Business Volume by Geographic Market
 
Africa/Middle East       3,429 
Asia/Pacific        7,940 Europe         6,944 North America/Caribbean    36,088 South America/Central America                  3,043
 
T o t a l        5 7 , 4 4 4  
 
Business Volume by Industry Sector  
Advanced Technology and Manufacturing    9,619 
A e r o s p a c e         3 , 1 5 6  
Agri-Food        1,500 
Base and Semi-Mfg Goods    13,332 Consumer Goods       2,633 Emerging Exporters (SME)         512 E n e r g y          3 , 6 3 8  Financial Institutions       1,025 
Forestry      12,050 
Mining, Infrastructure Dev. & Services                 6,380 Surface Transportation                   2,825 Telecommunications          774
 
T o t a l        5 7 , 4 4 4  
 
[US Question 1] 
 
Question:   Paragraph 6 on page 25 of the Secretariat report states that “Canada is examining 
alternatives to facilitate notification of appropriate  sub-national technical regulations in a timely 
manner.”  WT/TPR/M/179/Add.1 
 Page 87 
 
 
Please provide an update on the status of Canada’s efforts.  ANSWER:   Canada continues to engage provincial a nd territorial authorities in discussions on this 
issue in order to improve understanding of sub-na tional transparency requirements and has held 
workshops with provincial authorities on this issue in the past.  Canada continues to notify sub-national 
notifications that have an impact on internationa l trade.  The most recent (G/TBT/N/CAN/194) was 
issued February 2007.  
(2) Measures Directly Affecting Imports  
 
(i) Procedures, (ii) Rules of Origin, and (iii) Customs Valuation 
 [Switzerland Question 3] 
 
Question: Para. 16 of the Secretariat’s report relates to the Customs Self-Assessment procedure, 
aimed at facilitating imports. Could the Canadian au thorities please provide more information on: i) the 
criteria/requirements applied to become a pre-appr oved importer; ii) the procedural simplifications 
from which an importer under CSA benefits, and iii) are CSA procedures applied together with PARS 
or FIRST or does the CSA allow for similar treat ment as the two simplified procedures mentioned? 
 ANSWER:   (i) Criteria to become  a pre-approved importer:
  Importers eligible to apply to the Customs 
Self-Assessment (CSA) program include those who are resident in Canada; have a history of actively 
importing for at least two years; are without contraband or major commercial infractions; are prepared to make an investment in business systems; are willing to provide senior management representation 
that commercial business processes, customs interf aces, and the required trigger, audit trails, and 
linkages exist or will exist in the business' books a nd records; and are prepared to sign a Client 
Undertaking document with the Canadian Border Services Agency (CBSA). 
 Importers will have to give deta iled information such as their corporate structure and Business Number; 
key business activities and products;  company policies to minimize risk;  and, upon request, a quarterly report or the most recent audited financial statement.   
Importers will be asked to demonstrate that their books and records and business systems have, or will 
have, the necessary linkages, controls, and audit tr ails to support CSA program requirements such as: 
an account security number;  the accounting option sel ected;  an internal business monthly cut-off date; 
a business system trigger for customs accounting;  a way to capture the receipt  date in the commercial 
system;  a way to distinguish commercial importati ons from domestic purchases; and a sweep process 
to account for goods not accounted for by trigger. 
 Importers must also submit a list of their U.S. vendors and direct-delivery (domestic) consignees.  CSA-approved importers may be asked to sign a Clie nt Undertaking document which will include an 
outline of the roles and responsibilities of the impor ter or carrier, agreed-on accounting and payment 
time frames, and references to possi ble contraventions and resultant penalties.  The document will also 
outline how the CSA client and the CBSA can wo rk together to suppress contraband smuggling. 
 (ii) Procedural simplifications:
 The CSA program will give approve d importers the benefits of a 
streamlined accounting and payment process for a ll imported goods.  The streamlined accounting and 
payment process ends the need for importers to ma intain separate and costly customs processes, 
allowing them to use their own business systems to fully self assess and meet their customs obligations. 
 The CSA program will also give approved importers the benefits of a streamlined clearance option for 
CSA eligible goods.  The streamlined clearance proc ess ends the need for transactional transmissions 
of data related to eligible goods. This allows for the clearance of goods based on the identification of 
the approved importer, approved ca rrier, and registered driver. WT/TPR/M/179/Add.1 
Page 88  
 
The CSA program will reduce costs fo r the private sector by ending the transactional transmissions of 
data elements; ending the need for artificial cust oms systems; increasing the certainty of expedited 
customs processing; making it easier for clients to meet their obligations;  and streamlining legitimate trade.  
(iii) CSA, PARS & FIRST:
  CBSA has various independent Line Release Systems which processes 
release information before a shipment arrives.  Th ese systems speed the process of deciding to release a 
shipment or to refer it for examination.  The Pr earrival Review System (PARS) is one.  Under it, 
importers and brokers can send invoice and manifest  information to the CBSA before a shipment 
arrives.  Another is the Frequent Importer Release Sy stem (FIRST).  It applies to importers of frequent, 
low-risk, low-revenue shipments.  It requires prior CBSA authorization.  Still another is Line Release 
System CSA.  
[Singapore Question 1] 
 
Question:   According to the Secretariat (re para 17, page 27), Canada uses various risk-management 
techniques to process traders who are not approved under the Customs Self-Assessment and to target 
shipments of higher and unknown risk.  
• Could Canada provide more info rmation on its risk management techniques?  What criteria 
does Canada use to assess whether a particular sh ipment is of a “higher and unknown risk”? 
 
ANSWER:   Through the analysis and sharing of info rmation, the National Risk Assessment Centre 
(NRAC) increases Canada’s ability to detect and st op the movement of high-risk people and goods into 
the country by using sophisticated intelligence- gathering techniques and technology.  The NRAC 
ensures the timely distribution of this information to its intelligence and law enforcement partners and 
field officers who are ready to act quickly and decisive ly to apprehend and stop the entry of terrorists, 
high-risk people, illegal contraband,  drugs and weapons into Canada. 
 
[Colombia Question 19] 
 
The document from the Secretariat provides abundant and specific information on how customs procedures affect imports.  However, our authorities wish to ask some general questions in order to 
obtain more information on Canada’s customs system. 
 Question 19:   What is customs self-assessment?  What are the benefits of this mechanism for foreign 
traders?  
ANSWER:   The Customs Self-Assessment program (CSA) is a progressive trade option for clients 
who invest in compliance.  Based on the principles of risk management and partnership, the CSA program is of mutual benefit to the importing community and the CBSA.  Clients have the opportunity to significantly re duce the costs of compliance while enhancing their 
ability to comply with customs requirements.  The CBSA will have the opportunity to better align its 
resources with trade of higher or unknown risk.  Importers, carriers and commercial drivers are eligible  to apply.  In the case of importers, CSA will 
give approved importers the benefits of a stream lined accounting and payment process for all imported 
goods.  The streamlined accounting and payment pro cess ends the need for importers to maintain 
separate and costly customs processes, allowing th em to use their own business systems to fully self 
assess and meet their customs obligations.   WT/TPR/M/179/Add.1 
 Page 89 
 
 
The CSA program will also give approved importers the benefits of a streamlined clearance option for 
CSA eligible goods.  The streamlined clearance proc ess ends the need for transactional transmissions 
of data related to eligible goods.  This allows for the clearance of goods based on the identification of 
the approved importer, approved ca rrier, and registered driver. 
 
The CSA program will reduce costs fo r the private sector by ending the transactional transmissions of 
data elements;  ending the need for artificial cust oms systems;  increasing the certainty of expedited 
customs processing; making it easier for clients to m eet their obligations; and, streamlining legitimate 
trade.   
While the CSA program is designed to benefit impor ters, carriers and commercial drivers it would be 
an indirect benefit for foreign traders as it would sp eed the release of goods for their clients, if their 
clients were approved under the program.  
[Colombia Question 20] 
 
Question 20:  Do customs allow importers to have the fore ign goods in place on arrival without paying 
import duties and without prejudice to the final dete rmination of customs duties, after posting a bond? 
If so, explain the procedure and when the import declaration and supporting documents are presented 
and when the guarantee is actually paid.  
ANSWER:   Importers can obtain the release of their goods with full accounting and payment (paper 
option); release on minimum documentation (RMD) (paper or EDI option); or G7 Import One Step Release on Full Documentation (RFD) (EDI option).  
By using Release on minimum documentation (RMD) importers  can fast-track the release of their 
goods by accounting for and paying for them after th ey are released from customs.  To take advantage 
of this privilege, importers are required to pos t an approved amount of security with CBSA. 
 Unless CBSA examines the shipment , it will release it under RMD wh en the importer reports their 
shipment by presenting a completed cargo control doc ument, any import permits  or health certificates 
and, in most cases, two copies of a properly completed invoice. 
 Importers and licensed customs brokers who ask for Release Prior to Payment and for Uncertified 
Cheque privileges must post security representing 10 0% of their average monthly outstanding duties 
and taxes (less the Goods and Services Tax in the ca se of resident importers) during the previous 12-
month period, up to a maximum of $10 million CAN. 
 
The minimum amount of security required for importers is $250 CAN for a single customs office and $5,000 CAN for national privileges.  The minimum amount of security required for licensed customs brokers is $5,000 CAN to transact business at a single customs office and $25,000 CAN for national 
privileges.  
This security can be in the form of cash, a certified cheque, a transferable Government of Canada bond, 
or a bond issued by an approved financial institution.  At the CBSA, we identify each shipment with a unique 14-digit transaction number.  We use this 
transaction number to identify the shipment at vari ous times throughout the customs process.  Under 
the cash option, CBSA assigns a transaction number to  the documents in the accounting package when 
the importer or their agent presents them to obtain release of the goods.  If the importer has RMD privileges, CBSA will assign a unique five-digit account security number. This number will always appear as the first five di gits of the transaction number.  After the importer WT/TPR/M/179/Add.1 
Page 90  
 
receives an account security number, they will have to affix the transaction number in bar-coded format 
to the release and accounting documents for all later shipments.  
[Colombia Question 21] 
 Question 21:  Do Canadian customs require the use of customs agents (intermediaries) to import or 
export a good or for customs processing?  Explain.  ANSWER:   The Canadian Border Services Agency ( CBSA) does not require the mandatory use of 
customs brokers for either imports or exports.  Im porters can either account for their goods themselves 
or use the services of a licensed customs broker. 
 The importer is ultimately responsible for the accoun ting documentation, payment of duties and taxes, 
and subsequent corrections such as re-determinati on of classification, origin and valuation.  The 
importer remains liable for all duties owing until eith er the importer or the customs broker pays them.  
Customs brokers are required to obtain written author ization from their clients in order to transact 
business on behalf of their clients.  
[Colombia Question 22] 
 
Question 22:   How are express shipments treated?  Can goods dispatched as express shipments be 
exempt from import charges and duties? 
 ANSWER:   The CBSA’s Courier/Low-value shipment Program streamlines processing of low-value 
shipments through customs while providing the courier industry with expedited release.  
This program allows for a combined cargo report and release document called the "cargo/release list" 
for goods valued under $1,600 CAN, an expedite d release of qualifying shipments based on the 
information contained on the cargo/release list and accounting for duties and taxes on these shipments 
likely on a consolidated monthly entry.  CBSA re quires a compliance verification of courier and 
importer records by the CBSA to validate proper and complete accounting.  
Additionally, a remission of the customs duties and excise taxes paid or payable on imported goods 
transported by courier and having a value for dut y not exceeding $20 CAN is also granted under the 
“Courier Imports Remission Order”.  
(iv) tariffs 
 
[EC Question 14] 
 
Question:   Could Canada explain the basis for the di fference in tariff treatment for both products, 
which are virtually the same thing, except fo r the degree of maturity of the olive used? 
 
ANSWER:  Canada’s tariff treatment for olives reflect s our Uruguay Round schedule of commitments 
for the treatment of olives. 
 
(v) Other charges affecting imports  
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 1] 
 
Question on paragraphs 60-61 of pages 35-36:  Imported beer is not eligible for lower, tiered excise 
duty rates, while 100% Canadian wine packaged on or after July 2006 is exempt from excise duties. 
  WT/TPR/M/179/Add.1 
 Page 91 
 
 
Could Canada please explain the rationale for importe d beer not being subject to lower rate(s) while 
100% Canadian wine is exempt from excise duties?  
ANSWER:   Beer and wine are not like products and are taxed differently  in Canada as well as in many 
other countries. 
 
[New Zealand Question 4]  
Question:   As stated in the Secretariat’s report Cana dian wine made from 100% agricultural produce 
(including cider, wine coolers, fruit wines and sake)  packaged on or after 1 July 2006 is exempt from 
excise duties (WT//TPR/S/179, para 61).  Is Canada  able to explain how this excise tax for 100% 
Canadian grown wine is consistent  or otherwise with Canada’s WT O obligations to provide national 
treatment?  ANSWER:   The excise tax measures introduced in Canada’s Budget 2006 are not trade distorting and 
will have no impact on imports of wi ne into Canada.  On average, imports account for 70% of wine 
sold in Canada.  The measures only apply to approxima tely 5% of Canadian wine production.  They are 
for the benefit of small producers, just as with  similar programs in many other countries.  
 
(vii) Contingency Measures  [Switzerland Question 4] 
 Question 4(a):   Para. 73 of the Secretariat’s report indi cates that in limited circumstances, the 
President of the CBSA may launch own-initiative investig ations, that is apparently even in the absence 
of complaints brought by the Canadian industry.  Could the Canadian authorities explain under which 
circumstances such own-initiatives can be launche d and why they consider it necessary that the 
authority should have such a prerogative even in the absence of complaints from the Canadian 
industry?   ANSWER:   Article 5.6 of the Antidumping Agreem ent and Article 11.6 of the Agreement on 
Subsidies and Countervailing Measures give WTO members the right, under special circumstances, to 
initiate an investigation without ha ving received a written complaint from the domestic industry, as long 
as there is sufficient evidence of dumping or subsidi zation, injury and a causal link to justify the initiation 
of an investigation.  Canada has implemented this right into Canadian law.  However, self-initiations are infrequent and 
only used under special circumstanc es, such as cases where a safeguard  complaint is referred to the 
CBSA by the CITT because of evidence of  unfair trade, or where, in  the course of an anti-dumping 
proceeding, other suppliers, not part of the original  complaint, come to light.  While the Canadian 
industry is not required to submit a properly docu mented complaint in these instances, Canada’s 
competent authorities must still have sufficient evidence of dumping or subsidization, injury, and a causal link before initiating an investigation.  As well, under Canada’s bifurcated system, the 
responsibility for presenting the injury case before the CITT injury inquiry rests with Canadian 
industry, regardless of whether the investigation was self-initiated.  Question 4(b):   Para. 74 of the Secretariat’s report indicates that undertakings are accepted only if they 
are given by exporters or government of foreign c ountries representing all or substantially all of the 
trade in the product under investigation (about 85% of  the volume of dumped or subsidized imports 
into Canada).  Could the Canadian authorities e xplain why they seem to be discriminating against 
smaller exporters or exporting countries in th e matter of undertaking?  Also, do the Canadian 
authorities consider that such a difference in treatment  is consistent with Article 6.10 of the Agreement 
on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (the WTO Anti-WT/TPR/M/179/Add.1 
Page 92  
 
dumping Agreement) which provides that “the author ities shall, as a rule, determine an individual 
margin of dumping for each known exporter or producer concerned of the product under 
investigation”? 
 
ANSWER:  Under Article 8.3 of the Antidumping Agreemen t and Article 18.3 of the Agreement on 
Subsidies and Countervailing Measures, undertakings of fered need not be accept ed if the authorities 
consider their acceptance im practical, for exampl e, if the number of  actual or potentia l exporters is too 
great, or for other reasons, incl uding reasons of general policy.  
 As a matter of general policy, undertakings are only accepted by Canada’s authorities if they cover all 
or substantially all of the volume of dumped or subsidized imports.  In cases where there are numerous 
exporters, it would be impractical to  suspend an investigation and administer an undertaking for certain 
exporters but continue the investig ation for others.  Therefore, it is not a question of discrimination 
against small exporters, but a question of admi nistrative practicality and general policy.  
 
Regarding the application of Article 6.10 of the ADA , where “the authorities shall, as a rule, determine 
an individual margin of dumping for each known expor ter or producer concerned of the product under 
investigation,” Canada assumes that Switzerland is  asking whether small exporters or countries who 
have not negotiated undertaking agreements would be forced to accept undertaking conditions 
negotiated by large exporters repres enting substantially all of the volu me of dumped goods.  This is not 
the case - Canadian authorities must negotiate a se parate undertaking with each exporter, i.e., each 
exporter would have undertaking terms a nd conditions specific to its situation. 
 
[United States Question 2] 
 
In paragraph 75, page 39, the Secretariat report st ates that “Canada operates a prospective anti-dumping 
enforcement system in which exporters are informed  of the normal values for the products they export 
to Canada.  If future sales are made at price leve ls equal to or higher than the normal value of the 
product, no duties are assessed.”  Question 2(a):   Since January 1, 2005, how many ref und proceedings has Canada conducted pursuant 
to Article 9.3 of the Antidumping Agreement?  
 
ANSWER:   Canada’s anti-dumping duty assessment system operates on a prospective basis; therefore 
the application of Article 9.3 proceedings follows the provisions established under 9.3.2.  In Canada, 
these proceedings are referred to as re-determinati on proceedings. From January 2005 to December 
2006 inclusive, Canada concluded 2430 re-determination proceedings. 
 
Question 2(b):  When Canada conducts an Article 9.3 pro ceeding, how are the imports covered by the 
proceeding determined?  ANSWER:  In Canada, an importer may request a re-det ermination in respect of any goods imported 
into Canada, with respect to one or more of the following matters: 
 
- whether the imported goods are goods of the sam e description as goods to which the order or 
finding applies; 
- the normal value of any imported goods that are of the same description as goods to which the 
order applies; and 
- the export price of any imported goods that are of the same description as goods to which the order 
applies. 
 The imported goods covered by the proceeding are the goods that are identified in the importer’s 
request for re-determination.   WT/TPR/M/179/Add.1 
 Page 93 
 
 
Question 2(c):   Are all entries from a particular exporter during the relevant period addressed in an 
Article 9.3 proceeding, regardless of importer?  ANSWER:  As noted above, article 9.3.2 duty refund pr oceedings for prospective duty enforcement 
systems are based on an importer’s request for re -determination.  Therefore, each Article 9.3 
proceeding addresses the goods identified in an importer ’s request for re-determination, regardless of 
exporter.  Question 2(d):   How does Canada ensure that the antidum ping duties collected from importers do not 
exceed the margin of dumping for the e xporter for the relevant period of time? 
 
ANSWER:  Canada only collects anti-dumping duties equal to the amount that the normal value 
exceeds the export price of the imported goods.  Question 2(e):   Do importers that purchased dumped goods recei ve refunds to account for the extent to 
which non-dumped imports exceeded normal value? 
 ANSWER:   No.  In Canada’s prospective normal value system, final duties are assessed at the time of 
importation.  If the export price equals or exceeds the prospective normal value, no duty is collected.  If 
the export price is lower than the normal value, duty is  collected in the amount of the difference.  If an 
importer requests a re-determination of the normal valu e or export price of certain importations, the re-
determination is limited to the goods related to the request. 
 
Question 2(f):   Please identify the relevant provision of Canadian law that addresses each of the above 
questions.  
ANSWER:  For questions 2(a), 2(b), and 2(c): Re-det erminations requested by importers are 
conducted under section 56 to 60 of the Special Import Measures Act . 
 For questions 2(d) and 2(e):  The collection of definitive anti-dumping duties is provided for under 
section 3 of the Special Import Measures Act .   
 
Question 2(g):   Please identify all antidumping investigati ons since March 2001 that resulted in the 
application of antidumping duties, in which the Cana dian authorities made comparisons pursuant to the 
“targeted dumping” provision in the last sentence of Article 2.4.2 of the Antidumping Agreement. 
 ANSWER :  Canada has never applied the “targeted dumpi ng” provision contained in the last sentence 
of Article 2.4.2 of the Antidumping Agreement. 
 
[Colombia Question 23] 
 
Question:   Paragraph 75 says that Canada has a prospective antidumping system whereby it informs 
exporters of the normal values of products that they  export to Canada, so that if future sales are at 
prices equal to or greater than the normal value of the product, no duties are charged. 
 Can we conclude that this is how Canada applies provisional or final antidumping charges?  How does 
Canada determine the amount of the antidumping or countervailing duties applicable to goods at prices 
less than the "normal value"? 
 
ANSWER:   The prospective normal value system is applied for final anti- dumping duty purposes for 
products of an exporter that have had specific nor mal values determined during the investigation or 
through subsequent proceedings.  The amount of  anti-dumping duty is the difference between the 
export price of the subject goods and the normal value,  when the export price is lower than the normal WT/TPR/M/179/Add.1 
Page 94  
 
value.  When the export price is equal to or hi gher than the normal value, no anti-dumping duty is 
collected.  For products and exporters for which specific normal values have not been determined, an ad valorem  
duty is applied, expressed as a percentage of the export price. 
 
For provisional duty purposes, there may either be an  estimated normal value applied on a provisional 
basis (duty is collected in the amount by which th e export price is lower than the estimated normal 
value), or an estimated margin of dumping applied on an ad valorem  basis, expressed as a percentage 
of the export price. 
 
Normal values do not apply for countervailing du ty purposes.  Instead, a countervailing duty is 
collected equal to the amount of the subsidy, e ither expressed as an amount of subsidy on a per-unit 
basis or as a percentage of the export price.  During the provisional period, the provisional countervailing duty is usually based on the estimat ed amount of subsidy and is expressed as a 
percentage of the export price. 
 Where both anti-dumping duty and countervailing duty are applicable to any goods imported into 
Canada, and all or any portion of the margin of du mping of the goods is attributable to an export 
subsidy in respect of which a countervailing duty is  applicable, the anti-dumping duty is applicable 
only as follows: 
 
- where the whole of the margin of dumping of the good is attributable to the export subsidy, no 
anti-dumping duty is applicable on the imported goods;  and 
- where a portion only of the margin of dumping of the imported goods is attr ibutable to the export 
subsidy, an anti-dumping duty is applicable on the imported goods only in an amount equal to 
that portion of the margin of dumping of the goods that is not attributable to the export subsidy. 
 
[Colombia Question 24]  
 
Question:   Paragraphs 76 and 87 say that Canada  can simultaneously initiate antidumping 
investigations and countervailing duties, and pr oducts can be subject to antidumping charges, 
countervailing measures and safe guards at the same time. 
 In such cases, how does Canada do the causal analys is and what method does it use to simultaneously 
determine dumping practices, subsidies or increased imports and the harm done to the same product? 
 
ANSWER:  Regarding the causation analysis for investigations involving both dumping and 
subsidization, Canada’s competent authorities do no t attempt to isolate the separate effects of the 
dumping and subsidizing.  Injury from dumping and subsidization manifests itself in a single price 
effect in the market and these eff ects are so closely intertwined as to  make it impossible to unravel 
them so as to isolate and allocate specific, discreet portions attributable to each.  [Colombia Question 25] 
 
Question:  How does Canada determine simultaneously a nd for the same product the existence of 
serious harm that requires safeguard measures an d significant harm that requires antidumping or 
countervailing duties?  Since this combination of me asures may be more than needed to correct the 
damage to Canadian industry, how does Canada en sure that the corrective action taken is fair? 
 ANSWER:   Canada has never conducted an antidumping/ countervailing investigation and a safeguard 
investigation simultaneously.  In fact, the compet ent authorities are generally required to suspend 
safeguard investigations if they become convinced  that the alleged injury is due to dumping or 
subsidizing so that an antidumping/counte rvailing investigation can be conducted.  WT/TPR/M/179/Add.1 
 Page 95 
 
 
In the past, safeguard investigations have been c onducted on products that were already subject to anti-
dumping or countervailing measures at the time of th e safeguard investigation.  The purpose of anti-
dumping/countervailing measures is to ensure that impor ts that enter Canada are fairly priced, i.e. not 
dumped or subsidized.  If, while an anti-dumping or  countervail measure is in place, there is an 
increase in these imports under such conditions as to cau se or threaten to cause serious injury, then it is 
permissible to conduct a safeguard investigation based  on Canada’s rights and obligations contained in 
the WTO Safeguards Agreement.  
(viii) Technical regulations, conf ormity assessment, and standards 
 
[Colombia Question 26]  
Question 26:  According to paragraph 94, the Treasury Board Secretariat oversees the management and 
coordination of federal policy on tec hnical and other regulations.  The Regulatory Affairs Secretariat of 
Treasury Board in turn ensures that regulations proposed by federal departments comply with 
regulatory policy. 
 What happens with regulations issued by  provincial and territorial governments? 
 
ANSWER:  The Constitution Act, 1867, has divided go verning powers between two levels of 
government – the federal government and the provinc ial governments.  Each level of government is 
supreme in its area of jurisdiction.  Each provi ncial government has in place their own regulatory 
process to follow.  When appropriate, the Canadian WTO/NAFTA Enqui ry Point notifies provincial and territorial 
regulations which may have significant effect on tr ade. For instance, the Government of Ontario’s 
Proposed Ethanol in Gasoline Regulations , notified as G/TBT/N/CAN/137.  The regulation is 
available from the Ontario Ministry of the Environment web site, Environmental Bill of Rights (EBR) Registry Number: RA05E0010, http://www.ene.gov.on. ca/envregistry /025600er.htm.  However, the 
majority of regulations published by provinces and territories have a local or regional rather than 
international impact.  [Colombia Question 27] 
 
Question 27:   Paragraph 96 of the Secretariat’s report say s that in general, provincial regulations are 
not reported to the WTO because they do not have international impact. 
 
How does Canada determine that a regulation has no international impact?  Could you provide some 
examples?  Do any provincial regul ations affect imported products? 
 ANSWER:  Assessment of international impact is made pursuant to the Decisions and 
Recommendations noted in G/TBT/1/Rev.8, Section III, para 3.  
The topics of measures published in the provincial g azettes typically have a local/regional (i.e., non-
international) impact.  For example, topics would include administration of education, areas of service, land registration, mutual funds, liquor & gaming control boards, etc.  
 Examples of Canadian provincial regulations  can be found on the following websites: 
 a . Gazette Officielle du Québec , http://www.publicationsduquebec.gouv.qc.ca/ 
accueil.en.html 
 b. Royal Gazette, Prince Edward Is land, http://www.gov.pe.ca/royalgazette/ 
pdf/20061202.pdf 
 c. Ontario Ministry of Environment h ttp://www.ene.gov.on.ca/envregistry/025600er.htm 
 WT/TPR/M/179/Add.1 
Page 96  
 
When appropriate Canada does notify provincial a nd territorial regulations.  The Government of 
Ontario’s Proposed Ethanol in Gasoline Regulations  (which is available from Ontario Ministry of the 
Environment web site,  Environmental Bill of Rights (EBR) Registry Number : RA05E0010, 
http://www.ene.gov.on.ca/envregistry/025600er.htm) is an  example of a provincial technical regulation 
that Canada notified. This regulation was notified to the WTO as G/TBT/N/CAN/137. 
 
More recently, Canada notified the Government of Ontario’s Notice of Proposal for Regulation:  A ban 
on the burning of used oil in space heaters (G/TBT/N/CAN/197).  The proposal is available from the  
Ontario Ministry of the Environment web site  (http://www.ene.gov.on.ca/envregistry/029109er.htm), 
Environmental Bill of Rights (EBR) Registry Number:  RA07E0001.  
 
[Colombia Question 28] 
 
Question 28:   Paragraph 101 says that on request from a federal authority, Treasury Board can give an 
exemption from the prior publication requirement or shorten the comment period. 
 
Is this power of the Treasury Board discretionary or is it regulated? 
 
ANSWER:   The power in question is discretionary in nature.  
 
[Colombia Question 29] 
 
Question 29:   Does Canada publish comments from interested parties on a draft technical regulation? 
 
ANSWER:  The Regulatory Impact Analysis Statement (RIAS) that accompanies regulations contains 
a summary, prepared by the regulatory agency, of co mments received from interested parties as well as 
changes that were made to the regul ation as a result of these comments.  
 In addition, some regulatory agencies, such as I ndustry Canada in the case of Radiocommunications 
and Telecommunications, publish comments online from interested parties (see http://strategis.ic. 
gc.ca/epic/site/smt-gst.nsf/en/h_sf08544e.html)  [Colombia Question 30]  
 
Question 30:   Paragraph 114 says that the Standards C ouncil of Canada (SCC) is responsible for 
examining standards submitted by standard-setting organizations and, after they are amended as 
recommended, approving them as National Standard s of Canada.  These standards must include 
“appropriate” international standards and “relevant” na tional standards or be compatible with them and 
must be available for public review while they are being developed.  What are the criteria for considering a standard “appropriate” or “relevant”? 
 
ANSWER:   Canada is guided by Article 2.4 of th e WTO TBT Agreement when considering the 
relevance and appropriateness of  international standards.  
 Article 2.4 of the WTO TBT Agreement is refl ected in Section 6.5 of document CAN-P-2F, 
Requirements and Procedures for the Request fo r, Development, Approval, Preparation and 
Maintenance of National Standards of Canada  which describes the requirements for the development 
of a National Standard of Canada.  CAN-P-2F is available on line at http://www.scc.ca/Asset/iu_ 
files/criteria/2f_e.pdf  
[Colombia Question 31] 
 Question:   Could Canada provide information on how the “Export Alert” Program works?  WT/TPR/M/179/Add.1 
 Page 97 
 
 
ANSWER:   Export Alert!  is a web-based application that is u sed to disseminate WTO notifications by 
e-mail to Canadian stakeholders.  The service was de veloped and is provided by  the Standards Council 
of Canada (SCC).  Canadian subscribers self-register on SCC’s Web s ite by completing a profile that identifies their 
subject area(s) and country(ies) of interest.  The ser vice then disseminates the WTO notifications based 
on these profiles.  In addition to providing users with early warn ing of domestic and foreign regulatory changes before  
they become law, Export Alert!  grants Canadian subscribers access to  the regulatory texts.  The service 
also provides subscribers with the opportunity to vo ice their concerns regarding the measures.  These 
concerns are taken into consideration as the regulations are finalized.  
[Colombia Question 32] 
 Question:   Does Canada intend to draw up a list of t echnical regulations issued by the federal, 
provincial and territorial governments that are in force?  ANSWER:   The federal government publishes a table of  federal regulations, statutory instruments 
(other than regulations) and other doc uments that were in force at any time in the current calendar year 
in a Consolidated Index of Statutory Instruments  in the Canada Gazette Part II .  This Index is 
published four times a year.  Similar indexes or tables may also be produced by other jurisdictions 
within Canada. 
 
[Switzerland Question 5]  
Question 5 (a) on para. 111 :  As a general rule, type approva l is used for low-risk products,  whereas 
individual testing and certification is used for higher risk products, for example for medical devices.  Voluntary conformity assessment is carried out by  SCC-accredited bodies, which are mostly private 
entities.  The conformity assessment activities of the SCC relate primarily to third-party assessment.  
The authorities note that Canada relies on a wide va riety of strategies to ensure compliance with 
technical regulations.  Do we assume correctly that  type approvals are carried out by the Canadian 
authorities?  If this is the case, for which reasons  do low-risk products require an approval by 
authorities?  In Europe, low-risk products are norma lly subject to self-declaration by manufacturers. 
 ANSWER:  Third party certification, when required by  Canadian regulators, covers both type 
approval, and on-going factory surveillance.  As such it puts most of the cost burden for market 
surveillance onto the purchaser/end user of the regulated product.  For certain sectors mandatory third 
party certification is designed to meet the regul atory requirements of the Provinces and Territories. 
 Canada, like most WTO Members makes only limite d use of Supplier Declaration of Conformity 
(SDoC ) as an approach to regulated conformity assessment.   
Question 5 (b) on Para. 114 :  Four organizations are accredited by SCC to develop (voluntary) 
standards:  the Canadian General Standards Board, the Canadian Standards Association, Underwriters' 
Laboratories of Canada, and the Bureau de normalis ation du Québec.  These organizations administer 
the technical committees that define the content of standards (and voluntary conformity assessment 
procedures).  The SCC is responsible for review ing standards submitted by standards development 
organizations, and following the completion of any recommended revisions, approving them as 
National Standards of Canada.  These standards s hould be consistent with  or should incorporate 
"appropriate" international standards and "pertinent" na tional standards, and must be made available for 
public review during their development. SCC-accred ited standards development organizations must 
allow at least 60 days for public review of a draf t standard.  Around two thirds of the 921 National 
Standards of Canada approved by  the SCC between fiscal years 2002/ 03 and 2005/06 were the same as WT/TPR/M/179/Add.1 
Page 98  
 
or based on international standards.  Each of the SCC-accredited standards development organizations 
issue notices of public review for draft standa rds, and notices of adopted standards.  The SCC 
maintains an e-mail notification service (known as St andards Alert) on changes to Canadian (and 
international) standards. Could th e Canadian authorities indicate which standards are used as a basis for 
the accreditation of these standardization bodies? 
 
[Colombia Question 32] 
 
Question:  Does Canada intend to draw up a list of tec hnical regulations issued by the federal, 
provincial and territorial governments that are in force? 
 
ANSWER:   The federal government publishes a table of  federal regulations, statutory instruments 
(other than regulations) and other doc uments that were in force at any time in the current calendar year 
in a Consolidated Index of Statutory Instruments  in the Canada Gazette Part II .  This Index is 
published four times a year.  Similar indexes or tables may also be produced by other jurisdictions 
within Canada. 
 
[Switzerland Question 5] 
 
Question 5 (a) on para. 111:   As a general rule, type approval is used for low-risk products,  whereas 
individual testing and certification is used for higher risk products, for example for medical devices.  
Voluntary conformity assessment is carried out by  SCC-accredited bodies, which are mostly private 
entities.  The conformity assessment activities of the SCC relate primarily to third-party assessment.  
The authorities note that Canada relies on a wide va riety of strategies to ensure compliance with 
technical regulations.  Do we assume correctly that  type approvals are carried out by the Canadian 
authorities?  If this is the case, for which reasons  do low-risk products require an approval by 
authorities?  In Europe, low-risk products are norma lly subject to self-declaration by manufacturers. 
 ANSWER:   Third party certification, when required by Canadian regulators, covers both type 
approval, and on-going factory surveillance.  As such it puts most of the cost burden for market 
surveillance onto the purchaser/end user of the regulated product.  For certain sectors mandatory third party certification is designed to meet the regul atory requirements of the Provinces and Territories. 
 
Canada, like most WTO Members makes only limite d use of Supplier Declaration of Conformity 
(SDoC ) as an approach to regulated conformity assessment.  Question 5 (b) on Para. 114:   Four organizations are accredited by SCC to develop (voluntary) 
standards:  the Canadian General Standards Board, the Canadian Standards Association, Underwriters' 
Laboratories of Canada, and the Bureau de normalis ation du Québec.  These organizations administer 
the technical committees that define the content of standards (and voluntary conformity assessment 
procedures).  The SCC is responsible for review ing standards submitted by standards development 
organizations, and following the completion of any recommended revisions, approving them as 
National Standards of Canada.  These standards s hould be consistent with  or should incorporate 
"appropriate" international standards and "pertinent" na tional standards, and must be made available for 
public review during their development. SCC-accred ited standards development organizations must 
allow at least 60 days for public review of a draf t standard.  Around two thirds of the 921 National 
Standards of Canada approved by  the SCC between fiscal years 2002/ 03 and 2005/06 were the same as 
or based on international standards. Each of th e SCC-accredited standards development organizations 
issue notices of public review for draft standa rds, and notices of adopted standards.  The SCC 
maintains an e-mail notification service (known as St andards Alert) on changes to Canadian (and 
international) standards. Could th e Canadian authorities indicate which standards are used as a basis for 
the accreditation of these standardization bodies?    WT/TPR/M/179/Add.1 
 Page 99 
 
 
ANSWER:   The Standards Council of Canada’s (SCC) requirements for accrediting Standards 
Development Organizations (SDOs) to operate in Canada and de velop Canadian standards are 
contained in the SCC’s procedural document CA N-P-1.  This document incorporates the most 
demanding requirements of the TBT Agreement’s Code of Good Practice for the Preparation, 
Development and Adoption of Standa rds (contained in Annex 3) as well as ISO/IEC Guide 59, Code of 
Practice for Standards. In addition, the accred itation process incorporates the traditional Canadian 
requirement for consensus among all materially affected parties. 
 
The standards developed by accredited SDOs may be issued as SDO standards, or presented to the SCC 
for approval in order to be issued as a National St andard of Canada (registered designation).  If the 
SCC approves the SDO standard for publication as a Na tional Standard of Canada (NSC), the letters 
“CAN’ precede the SDO abbreviation in the number for the standard. The requirements for NSCs are 
slightly more rigorous than those for standards issu ed by an accredited organization, and are detailed in 
CAN-P-2.  
CAN-P-1 and CAN-P-2 can be obtained from the SCC website (www.scc.ca).  
 
[US Question 3] 
 
Question:  Paragraph 93 on page 45 of the Secretariat report explains that the Treasury Board 
Secretariat is developing a new G overnment Directive on Regulating. 
 
What are the objectives of the new Government Dire ctive, and how will it af fect Canada’s WTO TBT 
Agreement obligations?  ANSWER:   The objective of the proposed new Government Directive on Regulating (GDR) is to 
make Canada’s regulatory system more effectiv e, efficient, and accountable, by instituting new 
requirements to:  - demonstrate the net benefits of regulatin g through a quantified Cost Benefit Analysis; 
 - identify and publish service standards;  - measure, evaluate and review the effectiveness of regulations;  - cooperate and coordina te federally, nationally a nd internationally;  and 
 - streamline the government’s regulatory process. 
 The draft GDR would be supportive of Canada’s international trade obligations, including its 
obligations under the WTO TBT Agreement, and w ould provide direction to Canadian government 
departments on how they should comply with these obligations.  More info rmation on the proposed 
GDR, including a public consultation version of the di rective, can be found at www.regulation.gc.ca.  
 
[US Question 4] 
 
Question:   In March 2005, the Government of Canada re leased for public consideration a draft policy 
on supplemental fortification of food and bevera ges.  What is the status of this policy? 
 
ANSWER:   Health Canada released its proposed polic y and implementation plans for developing new 
food fortification regulations on March 31, 2005 (http://www.hc-sc. gc.ca/fn-an/nutrition/vitamin/ 
index_e.html).  
In developing the policy and implementation plans, the review process of the Dietary Reference Intakes 
conducted by the Institute of Medicine of the U.S.  National Academies was followed closely.  The 
review process was jointly funded by the U.S. Food and Drug Administration, the U.S. Food Safety and Inspection Service and Health Canada with the goal to establish a unified science base for 
nutrition-related matters.  WT/TPR/M/179/Add.1 
Page 100  
 
Health Canada is working to finalize the proposed regulations.  It is anticipated that the regulatory 
proposals will be published before mid-2007 in  Canada Gazette Part I for comment. 
 
[US Question 5] 
 Question:   The United States Government understands th at Canada’s Processed Products Regulations 
(Canada Agricultural Products Act) prescribe standa rd container sizes for a wide range of processed 
fruit and vegetable products.  For example, the Pr ocessed Products Regulations require manufacturers 
of baby food to sell in only two standardized container sizes.    
Please explain how its requirement to sell in container sizes that exist only in Canada is responsive to 
its WTO TBT Agreement commitments.  Has Cana da changed the regulations?  If not, why not? 
 ANSWER:   The Processed Products Regulations (PPR ) do prescribe standard container sizes for a 
wide range of processed fruit and vege table products including infant food. 
 
Canada conducted a regulatory re view to determine what was needed to modernize the PPR.  
Following the review, there was an initiative taken to  develop proposals to amend the food standards, 
including standard container siz es for processed fruit and vegetable products.  This was done through 
consultations with all interested stakeholders.  
After consultations, the number of standard container sizes for many  fruits and vegetables has been 
increased from those in the current regulations.  Th e proposed amendments were posted for public 
consultation, including the proposed standard contai ner sizes for infant and junior food on the Agency 
Web site in 2001.  
These latest proposed amendments to prescribed container sizes will allow for more packaging 
innovation and product developm ent, and will also contribut e to consumer choice.  
 The objective for standard container sizes is, in pa rt, to assist consumers in effectively comparing 
market value between competing products.  Havi ng minimum increments between standard sizes 
reduces the potential that consumers mistake similar sizes for the same size, thereby affecting their 
value comparison.  This is a legitimate objective for the purposes of Article 2.2 of the WTO TBT 
Agreement.  Other WTO members have acknowledged the importance of ensuring that consumers can 
effectively compare prices across competing products.  
[Japan Question 4] 
 
Question 4 (a) on paragraph 104, page 46:   The Secretariat report states that under the Regulatory 
Policy, the federal authorities must use availa ble international standards, guidelines, and 
recommendations "where those standards achieve the re gulatory objective" sought by Canada.  In this 
regard, Japan would like Canada to prov ide related and detailed information. 
 
How do the federal authorities know or find out whether such available internati onal standards exist?  
 
ANSWER:   Canadian federal authorities keep abreast of  relevant international standards through a 
variety of means.  Some participate in the activ ities of the international standardization bodies (ISBs) 
pertinent to their areas of responsibility.  Othe rs monitor the activities of these bodies.  Federal 
authorities may also identify the existence of ava ilable international standards via other formal 
networks, through informal networ ks developed by activities such as attending conferences, or by 
reviewing technical journals etc.  
 
Canadian federal authorities also use the Sta ndards Council of Canada’s  (SCC) Standards Alert 
database for information on international standards.  This database allows users to track standards,  WT/TPR/M/179/Add.1 
 Page 101 
 
 
including international standards and to receive au tomatic alerts when changes are made to these 
standards.  
Question 4 (b):  Is there any available quantitative data whic h shows the total amount or percentage of 
the utilization of international st andards by federal authorities? 
 
ANSWER:   Canadian federal regulations, of whic h there are approximately 3300, contain 349 
references to international standards.  These 349 refe rences are contained in approximately 180 federal 
regulations.  It should be noted that these federal re gulations include a broad range of regulations, not 
only technical regulations. 
 
[Japan Question 5] 
 
Question 5 (a) on paragraph 105, page 46:   The report by the Secretariat explains that the Standards 
Council of Canada (SCC) maintains an on-line sear chable database (known as RegWatch) of all 
standards incorporated into Canadian federal regula tions.  In this regard, please provide related and 
detailed information on the following questions;  What is the total amount and percentage of the S CC standards which are incorporated into Canadian 
federal regulations? 
 
ANSWER:   Canadian federal regulations currently c ontain 343 references to Canadian standards 
published by the four SCC accredited Standards Development Organizations (BNQ, CGSB, CSA, 
ULC).  
Question 5 (b):  Please exemplify the specific regulations which have incorporated many standards, 
and the ones which have not, and explain reason for the gap.  ANSWER:   Approximately 180 separate Canadian fe deral regulations contain a total of 1746 
references to standards (including industry, go vernment, national and in ternational standards). 
Canadian federal regulations c ontain references to standards when it is relevant to do so. 
 
Question 5 (c):   Are there any voluntary and/or mandatory mechanisms which facilitate or coordinate 
the cooperation between the standard developi ng organizations and the federal authorities? 
 ANSWER:   Federal regulators and other officials may par ticipate as part of the stakeholder matrix in 
the technical committees managed by standards devel opment organizations.  At  the sub-national level 
regulators and standards developm ent organizations cooperate thr ough the National Public Safety 
Advisory Committee, an independent group of sub-na tional regulators involved with electricity, fuels, 
elevating devices, amusement rides and boilers and pressure vessels.  [Japan Question 6] 
 
Question 6 (a) on paragraph 113, page 48:   The table AIII.3 of paragraph 113 explains the 
governmental MRAs between Canada a nd other countries. Regarding this issue, it is stipulated, “The 
Committee notes that the mutual introduction of cross- border designation systems in equivalent fields 
by governments can be a cost-effective agreem ent.” in paragraph 39 of the WTO document 
(G/TBT/19) “FOURTH TRIENNIAL REVIEW OF THE OPERATION AND IMPLEMENTATION OF THE AGREEMENT ON TECHNICAL BARRIERS TO TRADE UNDER ARTICLE 15.4,” completed in Nov. 2006.  
Are there cross-border designation systems that Ca nada’s regulatory authority can directly the 
designate Conformity Assessment Bodies (CABs) in foreign countries based on Canada’s law? 
 WT/TPR/M/179/Add.1 
Page 102  
 
ANSWER:   Canada does not have a policy of designa ting foreign conformity assessment bodies to test 
or certify to Canada’s mandatory requirements. Ca nada’s only experience with designation is in the 
context of a bilateral mutual recognition agreem ent (MRA) where Canadian conformity assessment 
bodies are designated by Canada to test to  an MRA partner’s regulatory requirements . 
 
Question 6 (b):  If there are the cross-border designation systems, please provide the name of the law. 
If there is no cross-border designation system, Japan w ould like to be informed of whether Canada has 
legal provisions that make it impossible to designate the CABs outside Canada, and what is the logic or 
background behind those provisions?  
ANSWER:   Canada does not have any specific legal provisions which prevent the designation of 
foreign conformity assessment bodies.   In response to Japan’s comments on Article 6.4 of  the WTO TBT Agreement which are contained in 
the paragraph which follows, Canada would like to  note that it has a strong record on implementing 
Article 6.4 of the WTO TBT Agreement with respect to national  treatment for foreign based 
conformity assessment bodies.  Indeed, the majority of certification bodies accredited by the Standards Council of Canada to certify products and services under Canada’s regulatory regime are actually based 
outside of Canada.   
 
Japan’s comments on Article 6.4: 
Article 6.4 of the WTO TBT Agreement stipulat es that “Members are encouraged to permit 
participation of conformity assessment bodies located  in the territories of other Members in their 
conformity assessment procedures under conditions no less favourable  than those accorded to bodies 
located within their territory or the territory of any other country.” It is also written, “The Committee renews its encouragement of Members to allow the participation of conformity assessment bodies 
located in the territory of other Members in their conformity assessment procedures, on a non-
discriminatory basis, as stated in Article 6.4. ” in paragraph 36 of the WTO document “FOURTH 
TRIENNIAL REVIEW OF THE OPERATION AND IMPLEMENTATION OF THE AGREEMENT ON TECHNICAL BARRIERS TO TRADE UNDER ARTICLE 15.4.”  If Canada adopts the cross-border designation system , the adoption will contribute to trade facilitation 
for foreign manufacturers willing to export to Canada.  At the same time, this will enable Canada’s 
companies investing in countries outside Canada to  acquire certifications of products by the CABs 
designated under the Canada’s laws in the countries outside Canada, where the production cost is low, 
and quickly forward them to the Canadian market with lower cost for certifications.  It is beneficial for 
Canada’s companies because invest ment in such countries where the production cost is low can be 
promoted. In this regard, it is beneficial not only fo r trade partners of Canada, but also Canada itself. 
 Question 7 (a) on paragraph 113, page 48 :  Please explain the Conformity Assessment System in the 
telecommunication equipment sector in Canada by  providing answers to the following questions: 
 Does the System prohibit suppliers from importing and selling uncertified telecommunication 
equipment in the Canadian market? Or will licenses and approvals no be issued to use such equipment? 
 ANSWER:  Uncertified radio equipment and undeclared wireline equipment cannot be imported or 
sold in Canada.  A list of certified or declared equi pment is maintained by Industry Canada.  For radio 
equipment requiring a license, a license will not be granted if the equipment has not been certified.  
 
Question 7 (b):   What is a criterion to classify such measures as second party assessment, third party 
assessment and the Declaration of Conformity (DOC )?  Are suppliers allowed to choose one of the 
measures by themselves?   WT/TPR/M/179/Add.1 
 Page 103 
 
 
ANSWER:   Canadian Telecommunications regulations prescribe the applicable conformity assessment 
process.  Wireline (or terminal) equipment must be registered based on a Declaration of Conformity. 
Radio equipment must be certified by a recognized certification body and liste d with Industry Canada. 
Interference causing  equipment is subject to a declaration of  conformity process and does not have to 
be listed with Industry Canada.  The procedures are av ailable at:  http://strategis.ic.gc.ca/epic/site/smt-
gst.nsf/en/h_sf06165e.html. 
 Question 7 (c):   Are there any regulations requiring a cer tain level of ability to those who conduct a 
procedure of the certifications and/or the DOC?  If so, please provide information on its qualification requirement, as well as clarification as to whether such a requirement contains local presence 
requirement. 
 ANSWER:  Yes. International standards, such as IS O/IEC Guide 65 and standard ISO/IEC 17025 are 
used to assess the competence of  testing laboratories and certif ication bodies who seek recognition 
from Industry Canada.  Conformity Assessment B odies seeking recognition from Industry Canada must 
have a permanent location in Canada or the territo ry of a partner with whom Canada has a Mutual 
Recognition Agreement.  For a complete list of re quirements, see document CB -02 which is available 
via http://strategis.ic.gc.ca/epic /site/smt-gst.nsf/en/sf05613e.html. 
 Testing laboratories for terminal equipment must be recognized based on ISO/IEC 17025 as per Industry Canada documents DES-LA B (http://strategis.ic.gc.ca/epic /site/smt-gst.nsf/en/sf01750e.html
) 
or REC-LAB (http://strategis.ic.gc.ca/ epic/site/smt-gst.nsf/en/sf05259e.html ).  Open Area Test Sites 
must meet the requirements of ANSI C63.4 and be registered with Industry Canada. 
 
Question 7 (d):   What are the obligations for those who acquire the certifications and/or use the DOC, 
for instance, requirements of registering the certif ied and/or the DOC equipment to the Canadian 
Government, and storing the relevant documents? Does the Canadian Government conduct inspections 
or make a collection order of those documents?   ANSWER:   The obligations of Certification Bodies (CBs) seeking recognition from Industry Canada 
for the certification of telecommunications equi pment are specified in document CB-02:http:// 
strategis.ic.gc.ca/epic/site/smt-gst.nsf/en/sf05613e.html. 
 
CBs are required to report to Industry Canada a ll certifications issued and retain the information 
regarding those certifications for ten years.   Terminal equipment registration based on a Declarati on of Conformity is requi red and the information 
such as technical briefs must be retained by the manufacturer for a period of ten years. 
 For interference causing equipment, no registration is  required, however the manufacturer must retain 
the measurement information for a period of five years.  Question 7 (e):  Are the same obligations as indicated in (4) imposed on those who acquire the 
certifications and/or use the DOC on the basis of the MRA? 
 ANSWER:  Yes. 
 Question 7 (f):  Please provide information on the provisions of the laws and regulations implementing 
the Electro-Magnetic Compatibility (EMC), and informa tion on the name of the authority in charge of 
the EMC.  ANSWER :  Section 5(1) of the Radiocommunication Act invests the Minister of Industry with the 
power to establish technical standards for electr omagnetic compatibility of Interference-Causing 
Equipment (ICE).  ICE is electrical or electronic equipment other than radiocommunication or WT/TPR/M/179/Add.1 
Page 104  
 
broadcasting apparatus that is capable of causing radio frequency interferen ce to radiocommunication 
or broadcasting (e.g. personal computers).   Part III of the Radiocommunication Regulations describes the legal fra mework applying to compliance 
of equipment to technical standard s established under Section 5(1) of  the Act.  Equipment subject to 
technical standards is of either Category I or Ca tegory II as defined in Part III of the Regulations. 
Category I equipment requires a certificate (called a Technical Acceptance Certificate, or TAC) attesting to its compliance with the standards established for it by the Minister.  While Category II equipment does not require a TAC, it is required to co mply with all applicable technical standards, like 
Category I equipment. To date, all ICE h as been treated as Category II equipment.  
 
Currently, there are six technical standards, ca lled Interference-Causing Equipment Standards (or 
ICES) for EMC.  These six standards correspond to  six respective classes of interference-causing 
equipment:   
ICES-001:  Industrial, Scientific and Medi cal (ISM) Radio Frequency Generators  
ICES-002:  Spark Ignition Systems of Vehicles and Other Devices Equipped With Internal Combustion 
                   Engines ICES-003:  Digital Apparatus ICES-004:  Alternating Current High Voltage Power Systems ICES-005:  Radio Frequency Lighting Devices 
ICES-006:  AC Wire Carrier Current Devices (Unintentional Radiators) 
 Compliance with ICES is mandatory for all equi pment falling under their scope.  All of the ICES 
prescribe limits of radio frequency noise, both fo r radiated and conducted emissions, to which the 
equipment must be shown to comply by means of testing.  The limits are in most cases harmonized 
with limits prescribed by the international sta ndards-setting organization, C.I.S.P.R.  (Comite 
International Special des Perturbations Radioelect riques).  In a few cases, the limits are harmonized 
with limits set out by the U.S. Federal Communicat ions Commission (FCC) in the FCC Rules, instead 
of with C.I.S.P.R.   For full compliance, the equipment must be labell ed with a compliance statement specified in the 
applicable ICES.  However, the party responsible  for compliance is not required to notify Industry 
Canada of compliance, nor is it required to submit test reports or other doc umentation demonstrating 
compliance of the equipment unless requested by Indust ry Canada.  This method of approval is referred 
to by Industry Canada as Self-Certification.   
Inquiries regarding Industry Canada EMC requirement s and the ICES standards should be emailed to 
the following internet address:  res.nmr@ic.gc.ca.  Question 7 (g)  Please provide information on the procedure a nd results of the market survey in the 
telecommunications equipment market, conducted by the Canadian Government and private bodies. 
 
ANSWER:   Industry Canada conducts market surv eillance to verify the compliance of 
telecommunications products with applicable regul ations.  This is done through in-house testing of 
audit samples obtained from manufacturers or samp les purchased in stores. Industry Canada also 
reviews technical briefs to verify compliance.  Market surveillance is targeted towards high risk 
products.  [EC Question 15] 
 
Question on page 45, para. 96:   What are the competences of the Provinces to adopt technical 
regulations? 
  WT/TPR/M/179/Add.1 
 Page 105 
 
 
ANSWER:   Section 92 of the Constitution Act (1867) of Canada provides for a division of legislative 
authority between provincial legislatures and the Parl iament of Canada.  As a result provinces are able 
to develop and adopt technical regulations in th e areas over which they have legislative authority. 
 
[EC Question 16] 
 Question:   What are the areas or sectors in which the Provinces can adopt technical regulations? 
 ANSWER:   Provincial legislatures have authority over a variety of areas.  Areas that specifically 
address products are primarily related to electricity, fuels, elevating devices, amusement rides, and 
boilers and pressure vessels.  It should be noted that  in some sectors such as agriculture, jurisdiction is 
shared between the Government of Canada and provincial governments. 
 
[EC Question 17] 
 Question 17:   Do these Provincial technical Regulations refer to provincial or federal standards? 
 ANSWER:   There are very few provincial standards.  National Standards, which are voluntary, are 
developed by the National Standards Systems (http://www.scc.ca/en/nss/index.shtml).  National voluntary standards may be used as the basis for techni cal regulations at the federal or provincial level. 
 
Provincial regulations, when they reference standa rds will use national, foreign or international 
standards.  Typically standards that are refe renced are developed by non-governmental bodies. 
 It should be noted that the Standards Council of Canada has established the Provincial-Territorial 
Advisory Committee, which offers advice and pr omotes cooperation between the provinces and the 
Standards Council of Canada.  
 
[EC Question 18]  
Question on page 46, para. 105:   How can importers to Canada  know which provincial technical 
regulations are relevant them? 
 
ANSWER:  Typically importers conduct their own due  diligence before entering a market by 
contacting customs brokers or trade officials from their respective territory.  Canada’s WTO Enquiry 
Point is another potential source of information on provi ncial technical regulations that are relevant for 
importers.  
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 2] 
 Question on paragraph 103 of page 46:   The Report indicates that “Regulations normally enter into 
force immediately after registration, but can only be  enforced once published in Part II of the Canada 
Gazette, which must occur within 23 days of regist ration.”  If we understand it correctly, this statement 
implies that regulations enter into force before th eir publication in Part II of the Canada Gazette.  
Article 2.12 of the WTO/TBT Agreement requires th at Members allow a reasonable interval between 
the publication of technical regulations and their en try into force, in which the “reasonable interval” 
shall be understood to mean normally a period of  not less than six months, according to the Doha 
Ministerial Decision adopted on 14 November 2001.  
We wonder how the Doha Ministerial Decision in this  respect is being taken into account in Canada’s 
statutory system?  
ANSWER:   The Government of Canada Regulatory Policy (1999) requires Canadian technical 
regulations which may impact trade to be notified to  the WTO.  Notification to the WTO is typically WT/TPR/M/179/Add.1 
Page 106  
 
undertaken when draft technical regulations are pub lished in Canada Gazette Part I. Following the 
prescribed comment period, regulations which have been published in Gazette Part I can be adopted 
and subsequently are published in Canada Gazette Part II. The period between publication in Canada 
Gazette I and Canada Gazette II depends on the meas ure but ranges from six to eight months or more. 
 (ix) Sanitary and Phytosanitary measures 
 
[EC Question 19] 
 
Question on page 50, para. 121:   Could Canada explain the reasons for its recently-launched 
regulatory process related to co mpositional standards for cheese? 
 ANSWER:   The Canadian Food Inspection Agency (CFIA) has launched a regulatory initiative 
relating to compositional standards for cheese.  The objective of the initiative is to contribute towards 
harmonization of existing federa l regulations (Food and Drug Re gulations and Dairy Products 
Regulations) by providing clarifica tion and consistency on the ingredie nts which may be used for the 
manufacture of cheese and provide consumers with info rmation on components of standardized cheese.   
 
[EC Question 20] 
 
Question:   How will Canada ensure that the results of th is process will be consistent with international 
standards and Canada's in ternational obligations? 
 ANSWER:   The Canadian Food Inspection Agency (C FIA) will take into account international 
standards for cheese such as those of the Codex A limentarius Commission and requirements of other 
countries.  As well, Canada notifies draft policies to the WTO under the relevant Agreement, allowing 
time for those WTO Members who wish to comment. 
 
[EC Question 21] 
 
Question on page 50, para. 124:   In the Secretariat's Report it is stated that "SPS requirements applied 
to imports are established on the basis of the disease or p est risks associated with that import.  It is also 
stated that in general, a risk assessment is conducte d prior to first-time imports of an animal or plant 
product from a particular country."  A European country requested in 2001 two import perm its for peaches and plums.  The CFIA had been 
since that date working on an import policy for prunus  fruits of all origins, until in 2006 a decision was 
made to consolidate all import requirements for all fruits from all origins in to one document, further 
delaying the 5 year wait of this country to obt ain an import authorization for peaches and plums. 
 Could Canada explain why the general rule  is not being followed in this case? 
 ANSWER:   Canada initiated a Pest Risk Assessment (PRA) for Prunus  fruit (peaches, cherries, plums, 
etc.) from Spain in 2001.  Although the initial intent was to develop a stand-alone import policy 
directive based on the PRA results, the Canadian Food Inspection Agency (CFIA) has since then 
undertaken the consolidation of all its fruit import di rectives into a single directive.  The requirements 
for all fruits from all origins will be summarised in this new directive, including the import 
requirements for Prunus  fruits from Spain.  Also, new import requirements involving the 
implementation of a Phytosanitary Management System  (PSMS) by the country of origin will be added 
to this new consolidated directive.  A PSMS aims at maintaining the risk at origin by documenting the production system “from the tree to the shipping carton” and reduce the length of trial periods, reduce the inspection level at the port of 
entry, and thus minimises the impediment on trad e.  PSMS activities include the documentation of all  WT/TPR/M/179/Add.1 
 Page 107 
 
 
activities, with emphasis put on pest su rveys, pest control, p est interceptions, staff training, etc.  It also 
allows for better traceability of th e produce should a problem occur, i.e. allows for the suspension of 
single packing houses rather than a whole country.  The CFIA believes this PSMS approach will ease 
trade in the long run by reducing th e risks associated with these products. 
 
Countries wanting to export fruits to Canada will have to do so according to one of the following 
options:  
• Option 1 - Pest Free Area, Place of Production, or  production site (validated by official pest 
survey results); OR 
• Option 2 - Phytosanitary Management System ( PSMS) - formerly called "Quality Management 
System (QMS)"; OR 
• Option 3 - Recognized Post-harvest Treatment (e.g. cold treatment). 
 In April 2006, the CFIA sent its draft guidelines for PSMS implementation to Spain’s NPPO, via the 
Spanish Embassy.  The CFIA was hoping Spain could review these guidelines and implement a PSMS so that Prunus  fruits can be imported under an interim workplan agreement.  The CFIA has not 
received any comments on the guidelines to date.  
 
Work on Canada’s general fruit policy has been delayed recently by several significant pest 
emergencies, including Plum Pox Virus and Phytophthora ramorum .  The CFIA hopes to finalise its 
draft in the coming months and will send it to it s stakeholders, including Spain, for comments. 
Implementation of the directive is expected to occur in spring 2008.  In the meantime, Spain is 
welcome to set up a PSMS ahead of time for its Prunus  fruit production, for review by CFIA experts. 
 
[EC Question 22] 
 
Question on page 51, para. 128:   It is mentioned that "Canada takes into account the OIE lists of 
countries recognized free from foot-and-mouth disease, ri nderpest, BSE, and contagious bovine pleuro-
pneumonia, but reserves the right to conduct its own science-based risk assessments for all other 
diseases".  Could Canada explain why it does not take into acc ount OIE freedom recognition lists for diseases such 
as Newcastle Disease in poultry? 
 
ANSWER:   The World Organization for Animal Health (OIE) does not have a freedom recognition list 
for Newcastle disease.  They only have official OIE recognition for foot-and-mouth disease, rinderpest, BSE and contagious bovine pleuropneumonia (see  http://www.oie.int/eng/info/en_procedures.htm).  
For all other diseases, the OIE reports information gi ven to them by the member country, but there is 
no official sanction. 
 
For all other diseases, the Canadian approach depend s on agreements that are in place bi-laterally, and 
on the nature the diseases themselves.  In general, for those countries for which Canada has evaluated 
and approved the veterinary infrastructure, Cana da accepts the country's report to the OIE for all 
diseases other than the "former List A diseases" (tube rculosis and brucellosi s, for which we have 
extensive programs in place), and BSE, as there w as much uncertainty around this disease at the time 
this decision was made.  For the EU for example, under the terms of the Canada/EU veterinary agreement, and following a 
comprehensive review of EU legislation and audit procedures, Canada has agreed to accept official 
commission decisions in the event of disease outbreak s.  We also accept their OIE reports on most 
"former List B diseases", although it should be noted that  some issues been have identified in this area.  WT/TPR/M/179/Add.1 
Page 108  
 
For example, even though many equine diseases of con cern are reportable under the EU legislation, the 
Member State OIE submissions do not all identify the diseases as reportable.  Canada is moving towards accepting the OIE recogniti on of disease-freedom where there is an official 
list.  For example, in the future, we are prepar ed to accept the OIE's evaluations for BSE and will no 
longer conduct our own evaluations. 
 
[EC Question 23] 
 
Question on page 52, para. 135:   What efforts is Canada maki ng to reduce waiting times for the 
authorisation of veterinary drugs? 
 ANSWER:   To address the number of active submissions for veterinary drug approvals, and to 
improve the timeliness of submission evaluations, the Veterinary Drugs Directorate (VDD) of Health Canada has, inter alia: 
 
• enhanced research support for both scientific evaluation and policy development activities; 
• strengthened science-based risk assessment capacity; and  
• initiated new policy development and submission review processes to streamline and improve 
the timeliness and effectiveness of the vete rinary drug pre-market review system. 
 VDD has undertaken a strategy to address the backl og of submissions.  Phase I, addressing short term 
submissions such as company name change, has b een successfully completed.  Phase II, addressing 
long standing submissions, was initiated as a multi-year process in fiscal year 2003-2004.  VDD has 
successfully met aggressive targets for each successive year and, for the current fiscal year, intends to 
reduce the backlog of submissions older than 12 months by 70%.  VDD antic ipates that the backlog 
will be eliminated by fiscal year 2008-2009.   VDD has made significant progress in the publicatio n of its New Drug Submission and Submission 
Management Guidelines to assist drug sponsors to develop better quality subm issions and to improve 
the capability of VDD staff in more efficient submissi on review.  The Guidelines also set the stage for 
the development of performance review standards.  
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 3] 
 
Question on paragraph 120 of page 49:   As indicated, the Separate Customs Territory of Taiwan, 
Penghu, Kinmen and Matsu has expressed concerns regarding Canada's 1 Jan uary 2005 ban, without 
proper notification or sufficient science-based ri sk assessment, on Enoki mushrooms raised in the 
growing medium.  We acknowledge that, thro ugh constructive bilateral discussions, Canada 
subsequently lifted the two-year ban in Janua ry 2007, permitting the import from us of Enoki 
mushrooms with trace growing media from designated facilities. 
 In the interests of ensuring compliance with the SPS Agreement and the transparency decisions of the 
SPS Committee, we would urge Canada to please notify trading partners of its  import requirements and 
carry out sound science-based risk assessment for its quarantine measur es in the future.  In addition, 
when Canada receives requests from trading partners  to review still undecided quarantine regulations, 
could it please respond as soon as possible in order to avoid impairing any mutual interests? 
 ANSWER:   Canada does notify all SPS measures that may have an impact on international trade. 
Canada does endeavour to respond to requests and co mments from trading partners in a timely manner 
regarding draft policies and regulations. 
  WT/TPR/M/179/Add.1 
 Page 109 
 
 
Canada did not implement a ban on Enoki mushroom s with growing medium on January 1, 2005.  
Canada’s import requirements for the import of soil,  growing medium, and edible crops such as Enoki 
mushrooms are documented and have existed publicly for many years.  The requirements are applied 
uniformly among exporting countries.  
Canada conducted a pest risk asse ssment in 2006 on Enoki mushr ooms from The Separate Customs 
Territory of Taiwan, Penghu, Kinmen and Matsu wi th growing medium and co ncluded they could be 
imported with approved growing media under specific phytosanitary conditions.  
[Brazil Question 5] 
 
Question:   In Chapter III, paragraph 128, the report addresses the recognition of disease-free regions in 
countries.  What are the perspectives of full impl ementation of SPS Agreemen t Article 6 in Canada? 
 ANSWER:   It is Canada’s view that adaptation of sanitary or phytosanitary measures to regional 
conditions is of key importance and potential benefit to both impor ting and exporting countries.  As 
well, delays in recognition of regional disease cond itions are problematic from both an exporting and 
importing perspective.  To this effect, Canada  has submitted a paper to the WTO SPS Committee on 
this topic in December 2005 (G/SPS/GEN/613).  Canada urges all Members of the WTO SPS Comm ittee to share their experiences regarding the 
implementation of Article 6, with a view to deve loping best practices.  Ideally, these experiences would 
include the perspectives of both importers and exporters.  Canada’s position is that all Articles of the SPS Agreement should be implemented fully by WTO 
Members. 
 
[Honduras Question 10] 
 
Question 10 (a):  Paragraph 122, (page 62 Spanish version,  page 50 English version), of the 
Secretariat’s report mentions that the CFIA ofte n concludes agreements on specific products with 
foreign governments on issues related to food safety and animal and plant health. 
 
What are the specific types of product for which b ilateral agreements with foreign governments have 
been made?  ANSWER:   Canada has a broad range of bilateral agreements, a rrangements and memoranda of 
understanding that cover numerous products including agricultural products of biotechnology, grain, 
fish and seafood, potatoes, pulses, and forestry products.  Question 10 (b):   How is this procedure different from the one normally used to permit access for 
other similar products?  
ANSWER:   Bilateral arrangements and agreements facilitate information exchange, promote 
harmonization and establish points of contact in regulatory agencies.  They do not lead to preferential or special treatment on SPS requirements.  All SPS measures are based on science regardless of whether a bilateral procedure is in place or not.  
Question 10 (c):   What types of prescription must be fulfilled? 
 ANSWER:   Canada’s current import requirements can be found in the CFIA’s on-line database at:  
http://airs-sari.inspection.gc.ca/ airs/airs_decisions.asp?l=E. 
 WT/TPR/M/179/Add.1 
Page 110  
 
[Honduras Question 11] 
 
Question:   Paragraph 124, (page 62 Spanish version, pa ge 50 English version) of the Secretariat’s 
report mentions that as a general rule, the authoritie s assess the risk before an animal or plant or a 
product of animal or plant origin from a specific country is imported for the first time. 
 
Is any follow-up done to determine the need for a nother risk assessment? In what cases does it apply? 
 ANSWER:   A follow-up risk assessment may be require d if the Canadian regulations have been 
modified and the exporting country falls under the new regulations, since the last risk assessment, 
and/or the exporting country’s disease status has changed. 
 For example Canada’s new BSE import policy requi res assessment of a country’s BSE status for 
certain commodities so this has triggered another BS E Risk Assessment for certain countries.  Also, we 
monitor the OIE website, and if a country’s disease stat us changes, it could trigger a risk assessment for 
that country. 
 
[Honduras Question 12] 
 
Question 12(a):   Paragraph 126, (page 63 Spanish versi on, page 51 English version) of the 
Secretariat’s report mentions that sometimes provi nces do their own plant health risk assessments to 
determine the need to apply provincial prescrip tions, but that they usually follow the federal 
assessments.  If a product has passed the federal ri sk assessment, could the provincial  prescriptions restrict entry to 
that specific province or would the federal assessment always prevail? 
 
ANSWER:   Federal regulations have jurisdiction with regards to international and inter-provincial 
trade for SPS issues.  Canada is not aware of an y situation where a provincial measure was more 
restrictive than the federal measure.  Question 12(b):   Would products covered by a free-trade treaty receive special treatment with respect 
to access to all Canadian territory? 
 ANSWER:   Canada’s free trade agreements do not provide for special or preferential treatment on 
SPS-related issues.  [Honduras Question 13] 
 
Question 13(a):   Paragraph 127, (page 63 Spanish versi on, page 51 English version) of the 
Secretariat’s report says that it can take up to a y ear to process applications to import animals and 
animal products for which a risk assessment is required.  
Does the one-year period also include issuing the reso lution to approve the respective import permit, if 
applicable?  ANSWER:   Yes, however, it should be noted that this is  only an estimate and a number of things could 
influence the time frame including diversion of risk assessment resources due to disease outbreaks or 
national catastrophes.  The quality of information provided could also prolong the process if it is 
necessary to request clarification or additional information.  Question 13 (b):   Once the risk assessment has been done, does the product have  access immediately 
or is there another administrative procedure to follow?  If so, how long would it take on average for a  WT/TPR/M/179/Add.1 
 Page 111 
 
 
product to enter Canadian territory, from the time that an assessment is requested until the import permit is issued?  ANSWER:   This varies with the commodity.  For some commodities, once a favourable risk 
assessment is completed and import conditions ha ve been created, the commodity can then be 
imported, as long as the disease status of the country  has not changed from the time the risk assessment 
had started.  If the disease status changes, the issuance of a permit could be delayed.  For other commodities, once the risk assessment is co mpleted with a favourable outcome, a site visit / 
inspection may need to be carried out.  The time for this will depend on the availability of an inspector 
and the authorities of the exporting country. 
 Question 13 (c):   For how long is an import permit valid? 
 ANSWER:   Depending on the commodity it could be valid for 1 month, 3 months or one year. 
 
Question 13 (d):   Could you provide information for the last three years on risk assessment 
applications and the average time to process them?  ANSWER:   The average process time for a risk assessment will vary from 3 months to a year.  This 
will depend on the type of information available from th e client and or the country.  If the officials or 
the client do not respond or do not provide enough  information to our questions, it will delay the 
process.  Question 13 (e):   What are the admissibility requirements for animal and plant products?  
 
ANSWER:   The current import requirements can be f ound in the Canadian Food Inspection Agency 
(CFIA) on-line database at:  http://airs-sari.in spection.gc.ca/airs/airs_decisions.asp?l=E. 
 
(3) MEASURES DIRECTLY AFFECTING EXPORTS  (iv) Export finance, insurance and guarantees 
 
[US Question 6]  
 
Question:   We note that several support programs in pa ragraph 165 on page 61 of  the Secretariat report 
appear to be contingent upon export performance.  Please explain how these programs are consistent 
with the SCM Agreement. 
 ANSWER:   Provincial export financing programs are av ailable to provide export finance products to 
smaller companies at commercial rates.  Other provincial and regional programs are available to assist companies to expand into markets outside of the province or region, not necessarily markets outside of Canada. 
 
(vi) Other measures affecting exports 
 
[US Question 7] 
 Question on paragraph 175:   On page 63 of the Secretariat report states that under the Export 
Distribution Centre Program, businesses can “acqui re domestically produced goods on a GST/HST-free 
basis” and “the benefits to businesses that export s ubstantially all their output is that the tax does not 
have to be paid at the time of acquisition or importa tion of the goods and later claimed back as an input 
tax credit.”  In footnote 177, the report further expl ains that among the eligibility criteria for benefiting WT/TPR/M/179/Add.1 
Page 112  
 
from the tax exemption is that the business’s “export re venue percentage for the year will be at least 
90%.”  Please explain how this program is c onsistent with the SCM Agreement. 
 
ANSWER:   The Export Distribution Centre Program (EDCP) permits eligible export-oriented 
businesses that do not manufacture or produce, and whic h add limited value to, goods in the course of 
their activities, to use an EDCP ce rtificate to acquire or import most  inventory without having to pay 
the GST/HST.  
This program is consistent with the ASCM as the G overnment is not foregoing any revenue within the 
meaning of Article 1.1(a)(1)(ii) of the ASCM.  In this regard, as eligible companies are entitled to 
claim back all of the GST/HST paid as input tax credits, the program simply eliminates the 
administrative burden of paying the tax and then claiming an input tax credit.  (4) MEASURES AFFECTING PRODUCTION AND TRADE  (i) Legal Framework for Business and (ii)  Incentives and other assistance to business 
 [Japan Question 8] 
 Question 8(a):   What are the reasons and background to re quire at least 25% of the directors within a 
corporation to be a resident Canadian unde r the Canada Business Corporation Act (CBCA)?   
 ANSWER:   The Canada Business Corporations Act ( CBCA) maintains a requirement that 25% of 
boards of directors of most federal business corpor ations be comprised of resident Canadians. 
 
It should be noted that prior to 2001 amendments to the CBCA, boards of federal corporations had 
been required to be comprised of a majority of resident Canadians.  The reduction was intended to 
allow more flexibility for corporations to organize their boards, and to encourage globally-oriented 
corporations to incorporate and locate their headqua rters in Canada.  Nevertheless, it was felt that a 
25% directors’ residency requirement should remain to  ensure that corporations have Canadian views 
represented during board deliberations.  As well, it was felt necessary that resident Canadian directors 
should be available to be served w ith legal documents or answer for the activities of the corporation, 
should the need present itself.  Question 8 (b):   Do all the provinces also require resi dent Canadian status under the provincial 
corporation laws?  If not, how does Canada explai n such an inconsistenc y between federal and 
provincial governments?  ANSWER:   Canada is a federation.  As such, each Ca nadian province and territory is constitutionally 
permitted to establish and administer their own corporate statute.  There is no obligation that these statutes be uniform or consistent in their requirements or application. 
 
With respect to directors’ residency requirements, there is a range of requi rements from a requirement 
of twenty-five percent (e.g. Ontario, Alberta) to  no requirement at all (e.g. British Colombia, New 
Brunswick).   
Corporations are free to incorporate in the juri sdiction that most readily suits their needs. 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 4] 
 
Question on paragraph 181-192 of page 64-66:   In the World Bank’s “ease-of-doing-business 
index”, Canada is ranked fourth overall out of the 155 economies surveyed.  Its contributions to the  WT/TPR/M/179/Add.1 
 Page 113 
 
 
development of global business are widely recogn ized and appreciated.  We have observed that, 
compared to several other advanced economies,  Canada has a much more favourable taxation 
environment, mainly as a result of its continuous pr ogramme of tax rate reductions.  We have also 
noticed, however, that the lower tax rates are applicable to domestic corporations only. 
 
We therefore wonder how easy it would be in practi ce for a foreign enterprise to set up a business 
establishment in Canada?  ANSWER:   While Canada is ranked fourth by the World Bank in terms of “ease of doing business” it 
is ranked first in terms of “ease of starting a business”. 
 There are very few impediments for a foreign ente rprise setting up a business establishment in Canada.  
The Canada Business Corporations Act (CBCA) does not differentiate between domestic and foreign 
incorporators.  Therefore, any one or more competen t individuals who are 18 years of age or older and 
who are not in a bankrupt status may form a co rporation under the CBCA. Similarly, one or more 
companies or "bodies corporate" may incorporate a company.  An incorporator (individual or 
corporation) may form a corporation whose sharehol ders, officers and directors are other persons, or 
may serve as the sole director, officer and sharehol der of the company.  An incorporator is also 
responsible for organizational procedures, such as filing the articles of incorporation and designating 
the first directors.  There are no restrictions su ch as minimum company size on the businesses that may 
incorporate under the CBCA. 
 At least twenty-five percent of the members of boards of directors of most CBCA corporations must be 
resident Canadians.  The registered office of the corporation must be in Canada.  
Federal corporations are formed when articles of in corporation are filed with Corporations Canada, and 
a certificate of incorporation is issued.  So long as the forms are filed properly, are in compliance with 
the act, and the appropriate fee is paid, the Director under the CBCA will issue a certificate of incorporation.  Requirements may be different if the incorporator is  incorporating under one of the provincial statutes. 
 
Under the Investment Canada Act , non-Canadians who acquire control of an existing Canadian 
business or who wish to establish a new unrelated Ca nadian business are subject to the Investment 
Canada Act. (ICA).  The ICA provides that the government may review certain investments by non-
Canadians to determine whether they are of net benefi t to Canada.  Under the ICA, a Notification or an 
Application for Review must be filed with respect to the establishment of a new business activity or the 
acquisition of control of an existing Canadian business by a non-Canadian.  An investment is 
reviewable if the asset value of the Canadian bus iness being acquired exceeds certain thresholds which 
vary depending on: the country of control of the inv estor; whether the acquisition is direct or indirect; 
and whether the Canadian business is engaged in cu lture, transportation, financial services or the 
production of uranium.  
 
(ii) Incentives and other assistance to business 
 
[Chile Question 2] 
 Question:   Measures affecting production and trade; II) Incentives and other business assistance 
measures; page 66 of Secretariat Report:  What is th e term of functioning of the programs mentioned?  
Is there information on their functioning?  Where can such information be obtained? 
 ANSWER:   Further information concerning the incen tives and other business assistance measures can 
be found in Canada’s notification under the Ag reement on Subsidies and Countervailing Measures 
(SCM).  (WTO document G/SCM/N/123, 1 August 2005). WT/TPR/M/179/Add.1 
Page 114  
 
[EC Question 24] 
 
Question on page 66, para. 193: In the Secretaria t's report there is reference to the assistance 
programme towards new media.  In the appendix,  we find further information by reference to 
Interactive Digital Media Tax Credit (Ontario ) and Production of Multimedia Titles Tax Credit 
(Quebec). 
 Could Canada provide informati on on the level of public assistance provided by those programmes, 
their duration –if limited in time-, eligible compan ies, and the number of beneficiaries that have 
benefited from these programmes so far? 
 
ANSWER:   Please see spreadsheet attached 
 
[EC Question 25] 
 Question 25:   Do other provinces of Canada provide similar assistance programmes? 
 ANSWER:   Ontario and Quebec have tax credit programs specific to new media expenditures. British 
Colombia uses an investment tax credit approach to support the growth of small new media companies 
(information can be found in the attached spreadsheet for EC Question 24).  There are also a number of 
tax credit programs for film, television, and video that  may consider new media projects to be eligible.  
The provinces of Newfoundland a nd Labrador, Prince Edward Island, Ontario, Quebec, Manitoba, 
Alberta, British Columbia and Yukon Territory all have other funding mechanisms such as 
contributions, grants, non-interest bearing loans that  provide financial support to new media projects.  
 
[Brazil Question 6] 
 Question:  In Chapter III, paragraph 200, the report reca lls that Technology Partnerships Canada 
(TPC) expired on December 31, 2006.  Can the Go vernment of Canada comment on plans it might 
have to replace such program with another program or mechanism?  ANSWER:   Consultations are ongoing to determine the most appropriate role and ways for the 
Government of Canada to effectively support th e commercialization of Canadian technology.  
Examination of the Technology Partnerships Canada  (TPC) program continues, with all options on the 
table.  Once the review is complete, the future of the program will be made public. 
   WT/TPR/M/179/Add.1
 Page 115Spreadsheet for EC Question 24 
Province Title of Initiative Eligible Applicants Eligible Pr ojects Eligible Expenditures M aximum Credit Rate Number of 
Beneficiaries 
Quebec Tax credit for 
corporations specialized in the 
production of 
multimedia titles Eligible corporations are those 
that are established in Quebec and carry on a multimedia title 
production business in Quebec.  
Corporation must have obtained a certificate issued by 
Investissement Québec. Most titles produced for commercial 
distribution purposes, as well as commissioned products. Titles must be 
produced in an electronic medium, be run 
using software that supports interactivity, and present, in significant proportions, at 
least three of the following four types of 
data: text, sound, still images, moving images.  Production Work:
 At the 
production stage, all work necessary for 
the production of the multimedia title, from design to perfecting of the final version ready for marketing purposes.  At 
the marketing stage, work done during the 
24 months following the date the final version is perfected.  Expenditures must be incurred by the 
producer for eligible production work.  Eligible labour expenditures include: salaries 
and wages paid to eligible employees; the 
portion of amounts paid to a sub-contractor having a non-arm's-length relationship with 
the multimedia producer for execution of 
eligible production work performed by employees of the sub-c ontractor in a facility 
located in Quebec; and 50% of amounts paid 
to a sub-contractor having an arm's length relationship with the multimedia producer for execution of eligible production work in 
Quebec. There are two categories 
under the tax credit.  Under Category 1
, the basic tax 
credit is generally 30% of 
eligible labour expenditures, with an added premium for 
French titles of 7.5% of 
eligible labour expenditures. Under Category 2
, the basic 
tax credit is 26.25% of 
eligible labour expenditures.  The premium for French titles is not applicable under 
this category. 78 certificates were 
issued in 2005/2006. 
Ontario Ontario 
Interactive Digital 
Media Tax Credit 
(OIDMTC) A qualifying corporation is a 
Canadian corporation (that is 
Canadian or foreign-owned), 
that develops an eligible product at a permanent 
establishment in Ontario 
operated by it, had during the preceding taxation year (on an 
associated company basis) 
neither annual gross revenues in excess of $20 million nor 
total assets in excess of $10 
million, and files an Ontario corporate tax return.  
Corporations that are prescribed 
labour-sponsored venture capital corporations under the 
regulations made under the 
Income Tax Act (Canada) and corporations that are exempt 
from tax or are controlled 
directly or indirectly by a corporation exempt from tax are not eligible for the 
OIDMTC. Interactive digital media product whose 
primary purpose is to educate, inform, or 
entertain, and that achieves its primary 
purpose by presenting information in at least two of: (i) text, (ii) sound and (iii) 
images.  Types of interactive digital media 
products that may be eligible for the tax credit include but are not restricted to 
games, educational and informational 
products.  Operating system software is not eligible for the tax credit. 100% of qualified labour expenditures
 
incurred by an eligib le corporation for 
employees that are Ontario residents, for 
services that are directly attributable to the development of the eligible product, and are 
rendered in a permanent establishment in 
Ontario, and 50% of remuneration paid to freelancers with respect to qualified 
activities performed.  The labour 
expenditures must also be: directly attributable to the development of the 
eligible product, incurred in the taxation year 
(or in a prior taxation year, to the extent that it is incurred in the 24-month period ending 
immediately before the month in which the 
eligible product is completed) and paid in the taxation year or within 60 days after the end 
of the taxation year, and paid for services 
rendered at a permanent establishment in Ontario.  Up to $100,000 of eligible 
marketing and distribution expenditures 
related to an eligible product can be included. The OIDMTC is calculated 
as 30% of eligible Ontario 
labour expenditures and 
eligible marketing and distribution expenses 
incurred by a qualifying 
corporation with respect to eligible interactive digital 
media products.   March 
2006 Budget expanded the eligibility for a 20% 
OIDMTC to products 
developed under a "fee-for-service" arrangement. 29 certificates were 
issued in 2004/2005 
with an estimated 
value of $3,023,298 for the tax credit.  WT/TPR/M/179/Add.1 
Page 116  
 
(iii) Government Procurement 
 [EC Question 26]  
Question page 26, para. 11:   What is the value of federal government procurement in 2004 not 
covered by the WTO GPA? 
 ANSWER:  This information is not available at this time. 
 
[EC Question 27] 
 
Question on  page 71, para. 212-214:   How would Canada reconcile the paradoxical fact that, on the 
one hand, prices for commodities such as information processing and related telecom services or text 
processing systems and visible recording equipment tend to constantly decrease over time and, on the other hand, that standing offers' established prices are frozen for a long period of time (2-3 years)? 
 
ANSWER:   As noted in paragraph 212 of the Secretariat Report:  “The length of time that a standing 
offer is in place … varies in accordance with the nature of the commodity and the conditions in the 
marketplace; authorities indicate it would generally be 2-3 years or less.”  One of the relevant 
conditions in the marketplace that is taken into acc ount when setting the length of time that a standing 
offer will be in place is anticipated pri ce volatility, either upwards or downwards. 
 
[EC Question 28] 
 
Question on page 72, para. 219:   Could Canada indicate, even approximatively, how much in 
percentage of overall procurement represent contra cts not subject to NAFTA Chapter 10 or to the 
GPA, reviewed by the interdepartmental Procurement Review? 
 ANSWER:   As indicated in paragraph 219 of the Secret ariat Report, all procurements that are not 
subject to the WTO Agreement on Government Proc urement or NAFTA Chapte r 10, and that are over 
C$2 million in value may be considered.  By numb er of procurements, this would be a very low 
percentage of the total procurement not covered by either international agreement, by value it would 
be a high percentage of the procurement not covered by either international agreement. 
 
[EC Question 29] 
 
Question page 73, para. 222:   Could Canada explain the reasons for the increased use of Advance 
Contract Award Notifications and stringent technical  requirements to restrict public contracting to 
preferred suppliers?  ANSWER:  Based on the 2004 data for the federal govern ment referred to in the Secretariat Report, 
the percentage of federal procurement, by value,  using ACANs (Advance Contract Award Notice) in 
2004 was 3.7%.  The federal government encourages  the use of ACANs as a procurement tool that 
supports competition by allowing the contracting aut hority to determine if, in fact, there are other 
interested companies in the marketplace.  Fo llowing the posting of an ACAN on the government 
electronic tendering service, all companies may submit a statement of capabilities for the procurement.  If the statement of capabilities is accep ted by the contracting authority, then a full open 
competition is conducted for the requirement, otherwi se, the contracting authority will proceed with a 
contract under the applicable limited tendering provisions. 
 In circumstances where Canada’s commitmen ts under the WTO Agreement on Government 
Procurement, NAFTA Chapter 10 or the Agreement on Internal Trade apply, the ACAN clearly shows the applicable limited tendering reason as set  out in these agreements.  If a supplier believes 
these reasons have not been appropriately applied or that technical specifications are not consistent  WT/TPR/M/179/Add.1 
 Page 117 
 
 
with the provisions of these agreements, they may pursue a bid challenge at the Canadian International Trade Tribunal. 
 
[EC Question 30] 
 Question on page 76, para. 230:   Could Canada explain the increased use of sole-sourcing in 
important procurement contracts at the provincial level?  ANSWER:   We are not aware of any data that would lead  to this conclusion.  It is our understanding 
that the use of such exceptional practices varies from year-to-year and from province-to-province, 
reflecting normal variations in le vels and types of procurement. 
 
[Colombia Question 33] 
 
Question on public procurement:   Paragraph 219 says that the federal government uses procurement 
to support national objectives such as industrial a nd regional development, economic development of 
Aboriginal people, the environment and other soci o-economic objectives and for this purpose requires 
examining all federal contracts worth over two mil lion Canadian dollars with a view to possible 
regional and industrial benefits.  We would like more information about how this ev aluation is done, what factors are considered and 
for what purpose the conclusions are used. 
 ANSWER:   The Procurement Review Policy is published by the Treasury Board Secretariat at:  
http://publiservice.tbs-sct.gc.ca/pubs_po l/dcgpubs/tbm_122/pr1_e .asp#_Toc443896449. 
 
More detail on the factors to be considered is pr ovided in Appendix A of the policy “Analysis of 
Proposals for Procurement Strategies in support of National Objectives”.  Further information 
regarding how such benefits are addressed in procur ement is set out in the section of the policy titled 
“Policy Requirements”.  In particular, as noted in  paragraph 9 of this section: “…the objectives and 
the evaluation criteria for contractor selection must be  clearly spelled out in the request for proposals, 
and industry must be made aware of those objectives as early in the process as possible. … 
Consultations must be carried out in a manner that en sures that all potential suppliers are treated fairly 
and equitably.”  Benefits are not sought when proc urement is subject to Canada’s commitments under 
the WTO Agreement on Government Pr ocurement or NAFTA Chapter 10. 
 
[Colombia Question 34] 
 
Question:  Paragraph 220 says that Canada has been  a party to the WTO agreement on public 
procurement since January 1, 1996.  The Secretariat says in that paragraph that Canada last provided 
annual statistics under paragraph 5 of Article XIX of the WTO agreement on public procurement in 
October 1998.  
The availability of statistics on public procurement is very important for countries that want to decide 
whether they should join the WTO’s Agreement on Pub lic Procurement.  It would be very helpful if 
Canada and member countries in this agreement that  are behind in reporting their statistics provided 
the corresponding information so that we would have an up-to-date tool for deciding on whether to join the Agreement. 
 
ANSWER:   Canada agrees that the exchange of sta tistical information by GPA members is one 
useful tool for countries considering participation in the Agreement.  The primary benefit of the 
statistics is that they permit suppliers and other countries to identify the types of goods and services 
that are procured by the GPA member, relative to the commitments set out by that member in its 
Annexes in Appendix I to the Agreement.  Alt hough the volume of procurement may fluctuate over WT/TPR/M/179/Add.1 
Page 118  
 
time, the statistics provided by Canada in 1998 cont inue to provide a good indication of the types of 
procurement carried out by the Government  of Canada and opened to GPA members. 
 
(iv) State-trading, state-owned companies, and privatization 
 
[Switzerland Question 6]  
Question:   Para. 233 of the Secretariat’s report indicates that state-owned enterprises include 44 
parent crown corporations and thr ee deemed parent subsidiaries, whic h are fully owned by the crown. 
Some of the crown corporation are conferred with “agency status” which means that they enjoy the 
constitutional immunities, privileges, and prer ogatives enjoyed by the Crown, which includes 
immunity from federal and provincial taxation. C ould the Canadian authoriti es provide a list of these 
so-called “agencies” and specify, if any, which of th ese corporations are mainly or fully engaged in 
international trade?  
ANSWER:  The corporate profiles section of the 2006 President’s Annual Report to Parliament - 
Crown Corporations and Other Corporate Interests of Canada indicates the status (agent of Her 
Majesty, not an agent of Her Majesty) for each Canadian Crown corporation. The Report may be accessed on line at:  http://www.tbs-sct.gc.ca/report/CROWN/06/cs-se_e.asp.  Two of the Canadian Crown corporations with agen cy status have been notified to the WTO as state 
trading enterprises:  the Fresh Water Fish Ma rketing Corporation and the Canadian Dairy 
Commission.  Information on these corporations ma y be obtained from the aforementioned Report. 
 
[EC Question 31] 
 Question on page 76, para. 231:   Canada conducted in 2006 audits of Cost of Service Differentials 
(COSD) between domestic and imported products for several Liquor Boards (Ontario, Quebec and 
British Columbia).  Under the Importation of In toxicating Liquors Act (IILA) each province and two 
territories have monopolies on the introduction of all alcoholic beverages into their territories both 
from abroad and from other provinces.  Under the IILA, liquor, including wine, considered 
intoxicating by provincial law may be importe d only by a board, commission, officer, or 
governmental agency legally authorized to sell intoxicating liquor.  Distribution and warehousing 
services for importers are generally also reserved fo r the provincial liquor boards.  As reported in 
Canada's last review, eight of the twelve provinc ial liquor jurisdictions in Canada apply a higher 
services charge to imported products.  According to the authorities, the difference reflects higher 
carrying costs (i.e. the interest cost of holding produ ct in inventory) as well as higher operational costs 
associated with imported products. 
 Could Canada elaborate on the conclusions of these  audits and on the possible actions taken by the 
Liquor Boards to minimize Cost of  Service Differentials (COSDs)? 
 ANSWER:   In accordance with the provisions of Anne x VIII, Article F of the Agreement between 
Canada and the European Community on Trad e in Wines and Spirit Drinks, the European 
Commission requested that audits be completed on th e cost of service differential applied by several 
Canadian provincial liquor authorities including the British Columbia Liquor Distribution Branch, the 
Liquor Control Board of Ontario, and la Société des alcools du Québec).  
Completed by independent auditors  in 2006 and employing generally accepted accounting procedures, 
the audits, as expected, showed differentials re flective of the carrying and operational costs for 
imported products.  Copies of the audit results we re shared with the appropriate provincial liquor 
authorities and with the EC.   WT/TPR/M/179/Add.1 
 Page 119 
 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 5] 
 
Question on paragraph 232 of page 76:   The OECD reports that Canada has around 100 state-
owned enterprises (SOEs), the total asset value of  which was more than US$50 billion in 2003, 
accounting for over 5% of its GDP.  
We would appreciate knowing: 
 (a) How many shares does the Canadian government have of these SOEs?  
(b) How many State-owned enterprises w ill be privatized in the future?  
(c) What is the timetable?   (d) What kind of methods are to be used in the privatization process?  
(e) Are there any limitations on foreign investors? 
 ANSWER:  Decisions to privatize are made on a case-by-case basis by the government owners.  
Therefore, it is not possible to predict whether or when privatization may occur.  Methods of 
privatization and the terms woul d be determined by the government concerned and would be 
consistent with any commitments under international treaties. 
 
[Chile Question 3] 
 
Question:  Page 96 (page 77 in English report).  Paragra ph 233.  Mention is made of the lack of 
availability of information relating to subfeder al state-owned businesses (sectors in which they 
operate, percentage of total assets). Is there any Website or other source fro m which information can 
be obtained?  ANSWER:   Each province and territory maintains a web site that includes information on the 
structure and organization of that province or territory.  These websites may be accessed from the 
following site:  http://www.canada.gc.ca/othergov/prov_e.html.  
(v) Competition policy and regulatory issues 
 
[EC Question 32] 
 
Question on page 79, para. 242:   Could Canada specify to which turnover the thresholds of CAN$35 
and 50 million respectively apply and by who this  turnover must be reac hed (Turnover of all 
participating companies?  Turnover of one comp any? World-wide turnover?  Or only domestic 
turnover?) 
 
ANSWER:   The requirement to notify the Compe tition Bureau falls under section 114 of the 
Competition Act .  Notification is required if dual thresholds are met:  (1) applies where the merging 
parties, together with affiliates, have assets in Ca nada, or sales in, from or into Canada greater than 
C$400 million;  and (2) the target firm’s assets in Ca nada, or sales in or from Canada is greater than 
C$50 million. 
 For further information on Canada’s merger notification system, please see:  http://www. 
competitionbureau.gc.ca/intern et/index.cfm?itemID=1163&lg=e. 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 6] 
 
Question on paragraph 240 of page 78:   As stated in the Report, “With respect to promoting 
compliance with the civil provisi ons in the Competition Act, the Commissioner of Competition may 
engage in discussions to obtain voluntary compliance or may file an application for an order to 
remedy a situation.” WT/TPR/M/179/Add.1 
Page 120  
 
(a) Could Canada please elaborate further on wh ether this voluntary compliance programme is 
 initiated by the Commissioner of Competition or operated by the businesses themselves?  If it  is the competition authority that initiates the programme, what are the criteria for choosing the 
 businesses? 
 (b) What is the procedure for joining this  voluntary programme?  Do guidelines exist? 
  
(c) What are the consequences if a business vi olates the Competition Act after having joined the 
 compliance programme? 
 ANSWER:   Paragraph 240 of the report deals with the range of remedial tools available to the 
Commissioner of Competition.  The Competition Bu reau's approach to the administration and 
enforcement of our laws is based on five prin ciples: confidentiality, fairness, predictability, 
timeliness, and transparency.  Tran sparency means that we are as open as the law permits and the 
response below outlines the variety of ways the Bureau maintains and promotes competition in the marketplace.  However, if it is determined that a complaint need s further investigation, the Bureau uses a wide 
range of education, compliance and enforcement tools to deal with criminal and civil cases. 
These tools are described in our Conformity Continuum  (http://www.competitionbureau.gc.ca/internet/index.cfm?itemID=1391).  They include:  
• public education, written opinions, information contacts, voluntary codes of conduct, written 
undertakings and prohibition orders; 
• the legal authority with court authorization to  search for and seize documents and other forms 
of evidence, to take sworn oral evidence and to demand the production of documents and 
records; 
• the ability to refer criminal matters to the A ttorney General of Canada, who then decides 
whether to prosecute before the courts; 
• the power to bring civil matters before the Co mpetition Tribunal or other courts depending on 
the issue;  and 
• the authority to make presentations and inte rvene on matters of competition policy before 
federal and provincial boards,  tribunals and commissions. 
 The Bureau also resolves issues brought to its atte ntion by different instruments such as using ACR 
(alternative case resolution).  In addition, the Bureau may contact parties directly to encourage 
voluntary compliance with Canada’s laws.  In the even t that the parties are reluctant to comply with 
Canada’s laws on a voluntary basis, the Bureau may seek legal action where necessary.  The Bureau 
does this by referring criminal matters to the Atto rney General of Canada for possible prose cution 
and civil reviewable matters under the Act may be  referred to the Competition Tribunal or other 
courts for decision.  As for corporate compliance programs, it is bu sinesses themselves who initiate these internal 
mechanisms.  The Competition Bu reau has developed a bulletin on our views on the components of a 
credible and effective program (a n updated version of the Bulletin w ill be published this Spring).  The 
bulletin can be found at the following link:  http://www.competitionbureau.gc.ca/internet/index. 
cfm?itemID=1638&lg=e.  As for consequences of violating the Competition Ac t even with a corporate compliance program, the 
bulletin states that this does not immunize firms or individuals from enforcement action.  Whether or 
not a company has a compliance program will, of itsel f, play a limited role in any decisions by the 
Commissioner to bring an application to the Compet ition Tribunal or to recommend to the Attorney  WT/TPR/M/179/Add.1 
 Page 121 
 
 
General that charges be laid.  Neither can fetter their responsibility when there is evidence of an 
offence.  
(vi) Intellectual Property Rights 
 
[EC Question 33]  
Question on page 80, para. 249:  Could Canada provide information on the functioning of its IPR 
enforcement mechanisms at the borders and on what efforts it undertakes to strengthen these 
activities? 
 
ANSWER:   In Canada, right holders have  certain mechanisms with regard to the enforcement of IPR. 
With respect to enforcement at the border, a rights holder must obtain a court order directing the 
Canada Border Services Agency (CBSA) to detect  and detain alleged infri nging goods.  Obtaining a 
court order requires the rights holders to provide  information such as: description/HS classification of 
the goods; quantity/value of goods; the importer, expor ter/vendor;  country of origin; entry point and 
mode of transport into Canada;  and estimated date of arrival.  The rights holder must then furnish 
CBSA with the order.  Once the goods arrive, CBSA will notify the rights holder and the importer that the goods have been detained and provide them an  opportunity to inspect the detained goods.  The 
inspection by both parties allows the allegation to be  either validated or rejected.  The rights holder 
must notify CBSA within two weeks from the noti ce of the goods being detained that they are 
pursuing legal action within the courts.  If they do  not notify CBSA within this timeframe, CBSA can 
release the goods.  A positive legal result for the right s holder could be in the form of a court order to 
either destroy the goods or transfer title and possession of the goods over to the rights holder. 
 In addition, Section 489(2) of Canada's Criminal Code authorizes public officers to seize anything 
which is illegal under any federal statute.  That is  to say, if Border Services Officers come across 
counterfeit goods at or during a border inspection,  they will seize them and contact the Regional 
Intelligence Officer who will in turn, contact the Royal Canadian Mounted Police (RCMP). 
 With respect to strengthening these activities, an in terdepartmental working group, at the officials 
level, is examining ways to enhance the en forcement of IPR, including border measures.  
 
[EC Question 34] 
 
Question 34:   The WTO panel ruling in European Communities - Protection of Trademarks and 
Geographical Indications for Agricultural Products  and Foodstuffs (DS174 and 290) confirmed that 
the co-existence of a geographical indication and a pr ior trademark is allowed under Article 17 of the 
TRIPS.  Is that co-existence possible under Canadian law?  Is such coex istence made possible through the 
application of Section 20 of the Canadian Trademark Act?  
ANSWER:   We note, as a preliminary point, that the WTO Panel did not accept that coexistence of a 
GI and a prior registered trade-mark is permitted as a general rule.  Rather, based on the evidence 
provided by the EC, the Panel found that the EC ha d established that the particular scheme for GIs set 
out in the EC’s Regulation was inconsistent with Ar ticle 16.1 of the TRIPS, but justified by Article 
17.  The WTO Panel did not suggest that coexistence for geographical indications must be provided in 
accordance with a particular model or as a general rule all WTO Members must follow. 
 Section 20(1)(b)(i) of the Canadian  Trade-marks Act provides an exception to trade-mark 
infringement for any bone fide use of the geographical name of one’s place of business where such use does not have the effect of depreciating the value of the goodwill attaching to the previously 
registered trade-mark. WT/TPR/M/179/Add.1 
Page 122  
 
[EC Questions 35-36] 
 
According to Section 9(1)(n)(iii) of the Trade-ma rks Act ( R.S., 1985, c. T-13 ), "No person shall 
adopt in connection with a business, as a trade-mark or  otherwise, any mark consisting of, or so nearly 
resembling as to be likely to be mistaken for any badge, crest, emblem or mark iii) adopted and used 
by any public authority, in Canada as an official mark for wares or services" in respect of which the 
Canadian Trade-marks Office has given public notice of its adoption and use.   Question 35:   What are the rights corresponding to the public authorities which have been issued 
such public notice on the use of an "official mark" under Canadian law? 
 
Question 36:   Can such public authorities use these offi cial marks in parallel to an existing 
trademark?  ANSWER FOR 35 -36:   Section 9(1)(n)(iii) prohibits the adop tion in connection with a business, as 
a trade-mark or otherwise, of a mark consisting of  or so nearly resembling as to be likely to be 
mistaken for an official mark adopted and used by a public authority in Canada.  The giving of public 
notice of adoption and use of the official mark by the Registrar of Trade-marks triggers the 
application of this prohibition against others.  
[EC Question 37 -38] 
 
On 30 November 2005, the Canadian Federal Cour t ruled on the action by the Canadian Post 
Corporation (CPC) against the decisions of the Ca nadian Registrar of Trademarks to give public 
notice of the adoption of 13 official marks by th e United States Postal Service (USPS).  This ruling 
sets aside those decisions on the grounds that, in or der to be entitled to an official mark, a public 
authority must be a public authority "in Canada"; i.e. subject to governmental control in Canada. 
 Question 37:   What are the implications of this interp retation of the Canadian Federal Court on cases 
when the TMO has already recognised the right of a fo reign public authority to use an official mark? 
 Question 38:   Do Canadian authorities consider this interpretation consiste nt with the national 
treatment obligation under WTO Agreements, most pa rticularly under Article 3 of the Agreement on 
Trade Related Aspects of Intellectual Property Right s (TRIPS) and Article III:  4 of the General 
Agreement on Tariffs and Trade (GATT 1994)?  If so, how  is this interpretation justified?  If not, how 
do Canadian authorities intend to remedy this situation?  
ANSWER FOR 37 AND 38:   The decision of the Federal Court Trial Division dated November 30, 
2005 setting aside the Registrar’s decision to give pu blic notice of the adoption of 13 official marks 
by the United States Postal Service (USPS) was appealed to the Fede ral Court of Appeal on August 4, 
2006.  On January 9, 2007, the Federal Court of App eal unanimously dismissed the appeal with costs.  
An application for leave to appeal was filed with the Supreme Court of Canada on March 9, 2007.  It 
is inappropriate for the Government of Canada to  comment on a matter that is before the courts. 
 
[EC Question 39] 
 
Article 18 of the Canadian Trade-marks Act establishes the cases where registration of a trademark is invalid. According to Article 22.3 of the TRIPS,  the Canadian Trademark Office should "invalidate 
the registration of a trademark which contains or co nsists of a geographical indication with respect to 
goods not originating in the territory indicated, if u se of the indication in the trademark for such goods 
in that Member is of such a nature as to mislead the public as to the true place of origin”.  However, 
Section 18 of the Canadian Trademarks Act (CTA) sets out only four instances in which a trademark 
can be invalid:  
  WT/TPR/M/179/Add.1 
 Page 123 
 
 
-The trademark was not registrable at the date of registration -The trademark is not distinctive at the ti me proceedings bringing the validity of the  
  registration into question are commenced -The trademark has been abandoned -the applicant was not the person entitled to secure the registration 
 
Question 39:   Does Canada consider that it has implem ented its obligation under Article 22.3 of 
TRIPS through Section 18 of the Canadian Trade- marks Act?  If not, which other legislative act 
implements this TRIPS obligation?  
ANSWER:   Article 22.3 states that “[a] Member shall, ex officio if its legislation so permits or at the 
request of an interested party, refuse or invalidat e the registration of a trademark which contains or 
consists of a geographical indication with respect to  goods not originating in the territory indicated, if 
use of the indication in the trademark for such goods in that Member is of such a nature as to mislead 
the public as to the true place of origin.”  The Canadian Trade-marks Office has no ex officio 
authority to invalidate the registration of a trade- mark. Rather, the obligations under Article 22.3 are 
met through various provisions of the Trade-marks Act . 
 The Trade-marks Act  provides mechanisms to allow interest ed parties to oppose or invalidate trade-
marks which are inter alia  clearly descriptive or deceptively misd escriptive of the place of origin of 
the wares or services in association with which the tr ade-mark is used or proposed to be used.  A 
deceptively misdescriptive trade-mark  can be a mark which would mislead the public as to the origin 
of the goods with which it is used.  For example, an application to register a trade-mark which is 
allegedly deceptively misdescriptive as to place of or igin could be opposed by an interested person 
pursuant to section 38(2)(b) of the Trade-marks Act  on the grounds that the trade-mark is not 
registrable, relying on, among other provisions, section 12 of the Trade-marks Act .  Likewise, section 
18 can also be relied upon to invalidate a register ed trade-mark as contemplated under TRIPS Article 
22.3.  An interested person could equally apply to the Federal Court of Canada to expunge a 
registered trade-mark under section 57 of the Trade-marks Act
3 on the ground that the trade-mark is 
invalid pursuant to section 18 because it was not registrable at the date of registration.  
[EC Question 40] 
 
Article 22.3 of TRIPS allows an interested party to  invalidate a trademark registration which consists 
of a geographical indication with respect to goods not originating in the territory, if use of the trade-
mark for such goods in Canada "is of such nature  as to mislead the public as to the true place of 
origin".  Section 18 of the Canadian Trademarks  Act (CTA) establishes that a trademark can be 
invalid when the trademark was not registrable "at the time of registration". 
 Question 40:   Should Section 18 of the CTA be consider ed as implementing Article 22.3 of TRIPS, 
do Canadian authorities interpret this provision as  to allow an interested party to invalidate a 
trademark consisting in a geographical indication only when the trademark in question mislead the public "at the time of registration"? Or would Section 18 also allow an interested party to invalidate a 
trademark when it becomes over the time misleading to the public? 
 ANSWER:   There are many provisions in Canadian legislation that serve to implement the 
obligations contained in the TRIPS Agreement.  As outlined in the preceding responses, Canada’s 
Trade-marks Act  provides a mechanism that permits inter ested parties to initiate proceedings to 
invalidate trade-marks that are clearly descriptive or  deceptively misdescriptive of the place of origin 
                                                     
 
3 Exclusive jurisdiction of Federal Court- 57. (1) The Federal Court has exclusive original jurisdiction, 
on the application of the Registrar or of any person interested, to order that any entry in the register be struck out 
or amended on the ground that at the date of the app lication the entry as it appear s on the register does not 
accurately express or define the existing rights of the pe rson appearing to be the re gistered owner of the mark. WT/TPR/M/179/Add.1 
Page 124  
 
of the goods or services in association with which th e trade-mark is used.  An interested person can 
apply, pursuant to section 57 of the Act, to expunge  a registered trade-mark that is deceptively 
misdescriptive as to the true place of  origin of the goods concerned. 
 The Trade-marks Act  contains provisions listed under the heading “Validity and Effect of 
Registration”.  Included under this heading is secti on 18, which sets out when registration is invalid.  
Section 18(1)(a) is meant to address registrability “at the date of registration”.  For further information 
on the question of misleading the public, see the response to the preceding question. 
 
[US Question 8] 
 Intellectual Property Rights - Copyrights
 
 Question 8:  Table III.16 of paragraph 254 of the Secretaria t report (page 82) states that Canada has 
“signed but not ratified” the World Intellectual Property Organization (WIPO) Copyright Treaty 
(WCT) and the WIPO Performances and Phonogram s Treaty (WPPT) (WIPO Internet Treaties). 
 Please provide an update on when Canada plans to am end its law to implement the provisions of the 
WIPO Internet treaties.  ANSWER:  Canada is considering options towards ta bling amendments to the Copyright Act on a 
number of issues including those related to the WIPO treaties. 
 Intellectual Property Rights - Enforcement
 
 
[US Question 9] 
 
Question 9:  Paragraph 269 of the Secretariat report (page 86) states that “Canadian customs services 
are not entitled to seize infringing imports ex-officio .  Under both the Copyright Act and the 
Trademarks Act, customs officials are authorized to  detain goods only subject to a court order by the 
holder of the intellectual property right.”  
 We understand that the Canadian government was c onsulting and reviewing the possibility of granting 
Canadian customs ex officio  authority.  Has there been any progress made on this issue? 
 
ANSWER:   An interdepartmental working group, at the o fficials level, is examining ways to enhance 
the enforcement of IPR, including border measures.  
[US Question 10] 
 Question 10:   With respect to the information provided in paragraph 264 on page 85 of the Secretariat 
report, will the Bill to Amend the Copyright Act be  re-introduced?  And, if so, will it include a 
provision to criminalize camcorder record ing/copying of movies in movie theaters? 
 ANSWER:   The Bill to Amend the Copyright Act died on the Order Paper in November 2005 with 
the dissolution of Parliament at that time.   The Government does not intend to re-introduce the Bill 
and refers to the response to U.S. Question 8 above for details of  future intentions.  
 
[Colombia Question 35] 
 Question:   Does Canada have a national policy on intellectual property? 
 ANSWER:   In Canada, the lead departments are Indust ry Canada and Canadian  Heritage.  There are 
a range of other departments and agencies, howev er, that are involved in policy development on  WT/TPR/M/179/Add.1 
 Page 125 
 
 
intellectual property, including the departments of Agriculture, Health, Environment, Justice, Public 
Safety and Emergency Preparedness, Canadian Inte llectual Property Office and Foreign Affairs and 
International Trade. For more information about Canada's intellectual property policy, please see the 
websites of Industry Canada's Intellectual Prop erty Policy Directorate (http://strategis.ic.gc. 
ca/epic/site/ ippd-dppi.nsf/en/Home <http://strateg is.ic.gc.ca/epic/site/ippd-dppi.nsf/en/Home) and the 
intellectual property portion of the Canadian He ritage website (http://www.chin.gc.ca/English/ 
Intellectual_ Property/index.html).  As part of Cana da's policy on intellectual pr operty, Canada is also 
involved in activities related to intellectual property in a range of international fora, including WIPO, 
APEC, the OECD, the WCO, the WHO, the G8, NAFTA-SPP (North American Free Trade 
Agreement Security and Prosper ity Partnership) and Interpol. 
 [Colombia Question 36] 
 
Question:   Does Canada have a legal regime for access to genetic resources?  If so, is it related to the 
intellectual property system?  
 
ANSWER:   There is no specific statute in Canada regulating access to genetic resources, but aspects 
of it are covered in a host of laws, regulations a nd practices.  The Canadian  Government has not yet 
developed an overarching regime for access to genetic resources at the national or sub-national level, 
but an initiative is underway in a collaborativ e process involving the Federal, Provincial and 
Territorial Governments.  There is no link between this initiative and the intellectual property system. 
Canada does not address access to genetic res ources as an intellectual property issue. 
 
[Colombia Question 37] 
 Question:   Paragraph 268 says that authorities indicate th at products made in another jurisdiction by 
the same owner of the brand or trademark as in Ca nada are not considered offending products simply 
because they came to Canada and the owner of the brand or trademark does not wish to distribute them in Canada.  However, parallel imports could be  restricted in other ways such as prescriptions of 
contractual rights and differing standards.  The situati on for patents is similar to the one for brands or 
trademarks. Imports of books are prohibited withou t the consent of the copyright holder, although 
there are some exceptions to this provision. 
 What is the validity in Canada of contract clauses for territorial exclusivity used to prevent parallel 
imports in distribution or supply contracts?  Are such clauses considered contrary to free economic 
competition? 
 
ANSWER:   Contracts that limit goods or services bei ng sold in Canada may be considered anti-
competitive under the Competition Act.  However th e facts of each situation would need to be 
examined in greater detail.  In general though, wh en assessing whether foreign sellers participate in 
the relevant market through a supply response, th e Competition Bureau may consider among other 
things the terms of license, franchise and non-comp etition contracts between foreign firms and their 
Canadian subsidiaries or third parties that have  purchased shares or assets of such subsidiaries. 
 Our merger enforcement guidelines at paragraph 6.14 also makes the following comment about contracts that may be of interest:  "Long-term excl usive contracts with automatic renewals, rights of 
first refusal and termination fees may constitute a barri er to entry.  Contracts with attributes that limit 
buyer switching may make it difficult for firms to gain  a sufficient buyer base to be profitable in one 
or more markets (even when barriers to entry in the industry are otherwise relatively low) and can 
thus make entry unattractive.  The deterring effects of such contracts are more pronounced when, for 
example, economies of density or scale are important and make it difficult for new or smaller firms to achieve minimum efficient scale of operations." 
 
http://www.competitionbureau.gc.ca/internet/index.cfm?itemID=1245&lg=e. WT/TPR/M/179/Add.1 
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In addition, the Bureau would consider any contr act clauses that limit competition in our abuse of 
dominance and criminal sections of the Competition Act.  For instance some situations could raise 
issues under the price maintenance provision, where there is attempt to influence upward or to 
discourage the reduction of the price at which a good is  supplied or offered.  As well some agreements 
that could unduly lessen competition are covered by th e conspiracy provision of the Act.  For more 
information on the Competition Bureau and Competition Act, please see: 
 http://www.competitionbureau.gc.ca/internet/index.cfm?lg=e.  
[Colombia Question 38] 
 
Question:   Paragraph 269 says that Canadian customs are not authorized to confiscate offending 
imports.  Under the copyright law and the law on  brands or trademarks, customs officers are 
authorized to retain goods only if the holder of the intellectual property right has obtained a court order for that purpose. 
 
Could Canada explain the procedure that a right holder should follow with the judicial and customs authorities if he thinks that a good which violates his rights has crossed the border?  ANSWER:   In Canada, the civil enforcement of IPR is the responsibility of the rights holders.  With 
respect to enforcement at the border, a rights holde r must obtain a court order directing the Canada 
Border Services Agency (CBSA) to detect and deta in alleged infringing goods.  Obtaining a court 
order requires the rights holders to provide informat ion such as:  description/HS classification of the 
goods;  quantity/value of goods;  the importer, exporter/vendor;  country of origin;  entry point and mode of transport into Canada; and estimated date of arrival.  The rights holder must then submit a 
copy of the order to CBSA. Once the goods arrive , CBSA will notify the rightsholder and the importer 
that the goods have been detained and may provide them an opportunity to inspect the detained goods 
for the purpose of substantiating or refuting the righ ts holder's claim in litigation.  The rights holder 
must notify CBSA within two weeks from the noti ce of the goods being detained that they are 
pursuing legal action within the courts.  If they do not notify CBSA within this timeframe, CBSA 
shall release the goods.  A positive legal result for th e rights holder could be in the form of a court 
order to either destroy the goods or transfer title a nd possession of the goods over to the rights holder.  
 
[Colombia Question 39] 
 
Question:   According to paragraph 259, in Octobe r 2006 the Patent Medicines (Notice of 
Compliance) Regulations (table III.16) were amende d to allow generic drug companies to plan when 
they could introduce on the market a lower-cost versi on of an innovative patent medicine.  According 
to the authorities, these amendmen ts will speed the arrival of generic drugs on the market once the 
patents have expired.  Al so in October 2006, amendments were ma de to the data pr otection provisions 
in the Food and Drug Regulations, so that new an d innovative medications would have at least a 
guaranteed eight-year period of market exclusivity.  
Why did the Government de Canada  amend its national regulations on data from pharmaceutical tests 
to provide eight-year protection?  ANSWER:   The amendments to the data protection provisions in the Food and Drug Regulations 
were the result of a three year analysis by the Gove rnment of Canada in whic h extensive consultations 
with the Canadian pharmaceutical and biotechnol ogy industry were taken into account.  These 
provisions were designed to stre ngthen data protection available for pharmaceutical and biologic 
drugs in Canada.  Implementing effective data protection is an obligation which arises out of 
Canada’s international trade commitments in bot h the WTO agreement on the Trade Related Aspects 
of Intellectual Property Rights (TRIPS) and the North American Free Trade Agreement (NAFTA). 
Under NAFTA, these obligations require that, where a company submits scientific data to a regulatory  WT/TPR/M/179/Add.1 
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authority seeking approval of a drug containing a new active substance , a minimum five-year period 
of market exclusivity must be provided to that company.  The exclusivity term is designed to protect the data from unfair commercial use by compe titors, and to allow innovative companies an 
opportunity to recoup a portion of the research and development costs incurred to produce the data. 
 
The amendments to the data protection provisions we re enacted at the same time as the amendments 
to the  Patented Medicines (Notice of Compliance) Regulations (“PM(NOC) Regulations ”).  The two 
sets of amendments have been brought together as a balanced set of measures, designed to work 
together to stabilize Canada’s intellectual property protection for drugs by ensuring a minimum period 
of protection, maintaining a reasonable ceiling on th e maximum protection available, and to ensure 
the timely entry of generic drugs onto the Canadian ma rket.  In Canada’s view, this brings it more in-
line with protections offered in the United States and Europe.  The amendments also introduced an 
additional six-month protection for pediatric indicatio ns as an incentive to increase the knowledge of 
the use of medications in pediatric populations, wh ich will lead to health benefits for Canadian 
children. 
 
IV. TRADE POLICIES BY SECTOR 
 (2) AGRICULTURE  [Switzerland Question 7] 
 
Question 7:   Para. 1 of the Secretariat’s report indicat es that Canada is a highly competitive producer 
of many agricultural commodities, and among the worl d's largest exporters of agri-food products.  In 
para. 15 it is mentioned that the average MFN app lied tariff for agriculture (WTO definition) was 
22.4% in 2006.  Could the Canadian authoriti es explain why competitive producers need such a 
border protection? Also, how high is the border prot ection for the products considered as competitive? 
 ANSWER:   The level of current MFN tariffs reflects the results of previous rounds of multilateral 
trade negotiations in which Canada participated.  Ov erall, Canada has one of the world’s most liberal 
market access regimes.  For example, 36% of Ca nada’s agricultural tariff items are bound at duty-
free. 
 
High over-quota tariffs are limited to supply ma naged commodities.  As the supply management 
system requires predictability in import levels, ther e is a need for higher over-quota tariffs for supply 
managed commodities.  [Australia Question 1] 
 
Question:   We note, as measured by the OECD, overall government support to agriculture has 
increased since Canada’s last review in 2003.  Alt hough this is below the average of OECD Members, 
we note Canada provides significant assistance to s upply-managed products (dai ry products, chicken, 
turkey, eggs) including through the use of high out -of-quota tariffs (para. 20 on page ix of the 
Secretariat’s report). 
 We would welcome an explanation of  the rationale for these policies. 
 ANSWER:   Canada’s supply management schemes fo r the dairy, poultry and egg sectors were 
introduced, more than 30 years ago, in response to market instability in inter-provincial and 
international trade and resulting producer  income instability and insufficiency. 
 The schemes contribute to market stability by limiting domestic supplies, using production or 
marketing quotas applied at the individual producer level.  Imports of the products concerned are WT/TPR/M/179/Add.1 
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subject to tariffs and tariff rate quotas administered  in accordance with Canada’s international trade 
obligations.  
[Australia Question 2] 
 
Question 2 (a) on (ii) border and related measures:  Milk Protein Concentrat es/Tariff Quota Measures 
 
We note from the Secretariat report (page 90, para graph 16) that Canada maintains 21 tariff quotas, 
which are mostly on imports of goods subject to the supply management system. 
 We also note the press release of 7 February 2007 by  the Canadian Ministers of Agriculture and Agri-
Food and of International Trade that Canada would be initiating negotiations under GATT Article 
XXVIII to restrict imports of milk protein concen trates in response to dairy industry concerns about 
the increasing use of these concentrates in making cheese and other dairy products.  The proposal 
involves incorporating milk protein concentrates into the existing tariff quota regime.   Can Canada explain this step, given the current  stage of the Doha R ound negotiations and the 
commitment to achieve ‘substantial improvements’ in market access for all agricultural products? 
 
ANSWER:   Canada is a strong supporter of an amb itious outcome to the Doha negotiations.  The 
Article XXVIII announcement must be put in persp ective – it only affects one type of product.  
Canada’s decision to invoke Article XXVIII was made as a result of the change in the tariff 
classification of milk protein concentrates resulting fro m rulings made by Canadian domestic courts in 
2005 and 2006.  The right to renegotiate tariff con cessions through Article XXVIII is a longstanding 
right under the WTO framework.  Overall, the aim of Article XXVIII negotiati ons is to maintain a 
level of concessions not less favourable to trade than that which existed prior to the negotiations.  The 
results of a GATT Article XXVIII should therefore not  affect the overall level of our existing WTO 
commitments.  Question 2 (b):   Could Canada explain how long it prop oses to maintain the supply management 
system and whether it is considering further Article XXVIII proceedings to protect supply 
management effectiveness?  ANSWER:   Supply management is a system that ensures a stable supply of dairy, poultry and eggs 
for Canadian consumers and the agri-food industry. It  also promotes stable farm incomes.  The basic 
idea behind supply management is to ensure th at domestic demand is met, while ensuring a 
reasonable return for producers and stable prices fo r consumers.  The supply management system has 
served Canada well for several years.  Canada has no plans to put time limits on the future of these 
schemes.  Canada is not currently consideri ng other Article XXVIII proceedings. 
 
Question 2 (c):   Milk protein concentrates are regular ly used in cheese production worldwide. 
Australia notes that Canada has announced a re view of compositional standards for cheeses. 
 Could Canada explain the rationale for reviewing th e compositional standards of cheeses;  specifically 
mozzarella, cheddar and cheddar-types and fine cheeses? 
 ANSWER:   The Canadian Food Inspection Agency h as launched a regulatory initiative relating to 
compositional standards for cheese.  The objectiv e of the initiative is to contribute towards 
harmonization of existing federa l regulations - Food and Drug Regulations and Dairy Products 
Regulations - by providing clarification and consiste ncy on the ingredients wh ich may be used for the  WT/TPR/M/179/Add.1 
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manufacture of cheese, allow for technological a dvances in cheese production, and provide consumers 
with greater predictability of essential characteristics of standardized cheese. 
 Question 2 (d):  We would be grateful if Canada could provide the terms of reference and proposed 
timeframe for the review? 
 
ANSWER:   The Canadian Food Inspection Agency will follow the Government of Canada 
Regulatory Policy which includes pre-publication and consultation with stakeholders.  The proposed 
amendments to the federal regulations are anticipated to be pre-published in Canada Gazette Part I by 
June 2007.  In keeping with federal government  regulatory policy and Canada’s international 
commitments, a comment period would be provided prior to final publication.  
 
[Australia Question 3] 
 
Question 3 (a):   T h e  Secretariat’s report (page 91, paragraph 19)  mentions that rather than 
establishing additional tariff quotas, Canada grants preferential access under fre e trade agreements to 
the same in-quota volumes specified in its WTO tariff quota commitments. 
 Could Canada clarify if preferential imports unde r free trade agreements are being counted against 
WTO MFN tariff quotas and comment on the cons istency with its GATT 1994 commitments? 
 
ANSWER:   According to Canada’s Schedule, in-quo ta imports include imports from all countries 
except in the case of beef and v eal, where Canada does not count imports from the U.S., and Mexico.  
The count of imports within a tariff quota is consistent with the count of imports used to calculate the 
size of the tariff quota.  Canada’s practice is consistent with its WTO obligations. 
 
Question 3 (b):   Beef 
 
Australia is concerned about the recommendation of the House of Commons Committee on 
Agriculture and Agri-Food to introduce unnecessar ily restrictive limits of 1,500 tonnes on 
supplemental beef import permits in the absence of ‘exceptional circum stances’ (as determined by the 
Minister of Foreign Affairs)  
 
The recommendation appears to be inconsistent with  Canada’s approach to free trade particularly 
given Australia and Canada are working together to wards agricultural trade liberalisation in the WTO. 
 (i)  Australia is therefore interested in the rationale for placing a limit on         supplemental beef import permits. 
 (ii) Australia is also interested in th e rationale for the limit being set at 1,500 
       tonnes.  Question 3 (c)  Has the decision been taken as a consequence of access liberalisation for FTA 
partners?  
Question 3 (d)  Following the decision, what are the respective access entitle ments of NAFTA and 
non-NAFTA WTO members?  Question 3 (e)  While Australia understands the recommendation is to be reviewed by Canada’s Beef 
and Veal Tariff Rate Quota Advisory Committee,  Australia requests information on what would 
constitute exceptional circumstances. 
 ANSWER TO QUESTIONS 3(b) - 3(e):   The recommendation that proposes limiting 
supplementary import permits for beef to 1,50 0 tonnes is a recommendation of the Standing 
Committee on Agriculture and Agri-Food of the Hou se of Commons and as such, is not binding on WT/TPR/M/179/Add.1 
Page 130  
 
the Government.  No decision has yet been taken re garding the need for, or indeed any changes to, 
Canada's beef and veal supplemental import policy.  It has been the government's practice in developi ng the Beef Tariff Rate Quota (TRQ) policy and 
supplementary import policy to consult with th e Beef and Veal Tariff Rate Quota Advisory 
Committee (TQAC).  The TQAC is co mposed of stakeholders from all sectors of the beef industry.  
This Committee has a good record of reaching con sensus and has in the past provided excellent 
advice to the government in the development and ad ministration of the Beef TRQ and supplementary 
import policy.  [Australia Question 4] 
 
Domestic Programmes 
 
Canadian Agricultural Income Stabilization Program 
 In 2003 Canada implemented the Canadian Agricultu ral Income Stabilization (CAIS) Program, which 
integrated the previous Net Income Stabilization Account (NISA) and the Crop Insurance program.  
The CAIS program is touted as a whole-farm risk management tool, available to all producers, that 
provides protection against both small and large declines in income.  
Question 4 (a):   How does Canada intend reporting CAIS payments to the WTO given that 
production insurance payments are considered non -product specific amber box support while the 
income stabilisation component of CAIS is a pa rtially green box and par tially amber box depending 
on the coverage farmers choose?  
ANSWER:   In G/AG/N/CAN/64, Canada notified that it would be reporting the “Income Disaster 
Component of the Canadian Agricultural Income  Stabilization (CAIS) Program” under Paragraph 7 
(Income Insurance and Income Safety-Net Progr ammes) of Annex 2 of the WTO Agreement on 
Agriculture.  Canada will notify the amounts for the “Income Disaster Component of the Canadian Agricultural 
Income Stabilization (CAIS) Program” and the “I ncome Stabilization Component of the Canadian 
Agriculture Income Stabilization (CAIS) Program” in its WTO notification for 2004 beginning with 
the CAIS 2003 stabilization year.  Question 4 (b)  Some provinces administer the CAIS directly while in other provinces the CAIS is 
administered by the federal government. 
  (i) Can Canada outline any differences betw een the province-based and federal-based 
  CAIS programmes.  ANSWER:   There are no differences in the operation of the CAIS programme across administrations. 
They are the same programme with different delivery agents. 
  (ii) Are there differences between province-based implementation and administration of 
  t h e  C A I S ?   
ANSWER:  There are only minor differences in the administration of the CAIS program across 
administrations such as sign-up deadlines, appeal processes and structure of forms. 
  (iii) Are provinces that administer the CAIS i ndependently from the federal government 
  allowed to supplement additional funds to th e CAIS and, if so, how is this reported to 
  t h e  W T O ?   WT/TPR/M/179/Add.1 
 Page 131 
 
 
ANSWER:   CAIS is the major cost-shared national program between the fe deral and provincial 
governments.  That being said, given the shared ju risdiction of agriculture between the federal and 
provincial governments, provinces have the author ity to develop their own separate, provincial 
programs.  
 Question 4 (c):   Notifications 
 
Could Canada advise when it will provide these no tifications concerning agricultural domestic 
support (2002 to 2006 inclusive)?  
ANSWER:   Canada’s domestic support notificati on for 2002 (G/AG/N/CAN/66), dated 7 March 
2007, was circulated to WTO Members on March 8,  2007.  The work on Ca nada’s domes tic support 
notifications for 2003 and 2004 is well underway.  
 
For 2005 and 2006, the necessary data collection fo r the domestic support notification is underway. 
 
[New Zealand Question 1] 
 
Question 1 on Economic Environment:   The Secretariat’s report (W T/TPR/S/179 para 5) notes that 
despite Canada’s good recent economic performance, relatively slow productivity growth has been a 
feature of the economy.  It notes that productivit y growth could be accelerated by, among other 
things, eliminating barriers to agricultural imports a nd that reform in this sector could lower costs to 
Canadian taxpayers and consumers.  Does Canada  have any plans to eliminate these barriers to 
agricultural imports, to encourage productivity growth and greater benefits to Canadian taxpayers and 
consumers?  
ANSWER:   Canada is continually reviewing and upda ting its domestic agricultural policies with a 
view to encouraging productivity growth.  Thro ugh policy initiatives such as the Agricultural Policy 
Framework (APF), and subsequent Next Generation for Agriculture and Agri-Food Policy, Canada is 
able to position itself as a world leader in food safety and quality, innovation and environmentally 
responsible agriculture production.  
Canada’s domestic policies are designed to ach ieve productivity growth benefits to Canadian 
taxpayers and consumers, while taking into consideration Canada ’s international commitments. 
 
[New Zealand Question 2] 
 Question 2 (a) on Agriculture:   The Secretariat report (WT/TPR/S/179 para 13) notes significant 
increases in recent years in the level of federal a nd provincial expenditure in support of the agri-food 
sector; some but not all of this is in response to  drought conditions and the discovery of BSE in 
Canada.  Can Canada comment on this trend in relation to its WTO commitments on domestic 
support?   
ANSWER:   Canada’s domestic support fits within Canada’s commitment to the WTO.  Recent 
increases in federal and provincial expenditures should not necessarily be interpreted as a trend; 
higher expenditures in 2003/04 to 2005/06 were ma inly triggered by random, extraordinary events 
which impacted negativel y on farmers’ income.  
 
Various factors impacted negatively on farmers’ market returns in recent years.  Among the key 
factors, there are the effects of the two years of back-to-back droughts and more than two years of BSE-related border closure.  Another key element is  the rapid appreciation of the Canadian dollar vis-
à-vis the U.S. currency in 2003;  this translated in significant drops in the prices of the major commodities produced in Canada for which prices are set on international markets. 
 WT/TPR/M/179/Add.1 
Page 132  
 
Question 2 (b):   The Secretariat report (WT/TPR/S/179 para 14) notes that according to OECD PSE 
figures, the most heavily supported commodities in Ca nada are milk (at 58%) and beef and veal (at 
21%).  We note that Canada has made substantial pr ogress in reforming its agricultural policies to less 
trade distorting measures of support but observe th at PSE support per commodity continues to trend 
upward.  Can Canada explain why PSE support per co mmodity for beef and dairy continues to rise 
and can Canada elaborate on whether and how it is addressing this trend? 
 ANSWER:  Effectively Canada has made substantial pr ogress in reforming its agricultural policies to 
less trade distorting measures of support.  This progress is reflected in Canada’s PSEs for all commodities which have dropped significantly since 1986.  This progress is also reflected in most of 
the PSEs by commodity, with a few exceptions such as higher support for beef and veal during the 
years marked by the BSE-related border closure.   Since 1986 the support for the dairy industry in Ca nada has been on a declining trend.  The 
commodity PSE for dairy fell from 73% in 1986-88 to 58% in 2002-04.  Public support to milk 
producers in Canada consists mainly  of market price support, which in  relative terms (in percentage of 
production) continues to decline.  
[New Zealand Question 3] 
 
Question 3 (a) on Border and related measures:   Tariffs:  The Secretariat’s report (WT/TPR/S/179, 
paragraphs 37 & 39) states that the average a pplied MFN tariff in Canada was 3.8% for non-
agricultural products, 22.7% for agricultural products and 313.5% for fats derived from milk.  Tariffs 
in the dairy sector are thus vastly disproportiona te to MFN tariffs for all other goods.  How does 
Canada plan to reduce prohibitive tariffs in the dairy sector to a level proportionate to other products?   
 
ANSWER:   Canada’s dairy industry operates under a supply management system.  Supply 
management relies on predictable supplies - ach ieved through marketing/production quotas and 
import measures - in order to bring price stability to the market.  Imports are regulated through tariff 
quotas and high over-quota tariff ra tes.  Canada’s tariff level re ductions for agricultural products, 
including dairy products, were agreed to during the Uruguay Round and are laid out in Cana da’s Final 
Schedule of Agriculture Commitments.  Canada applies the final bound tariff rate for all dairy 
products. 
 Question 3 (b):   How does Canada see these averages (agricultural and overall) being affected by its 
recent announcement that it plans to invoke Article XXVIII of the GATT to impose tariff-rate quotas on the import of milk protein concentrates? 
 
ANSWER:  This will depend on the outcome of GA TT Article XXVIII negotiations and trade 
patterns . 
 Question 3 (c):   How does Canada see the Article XXVIII announcement c ontributing to its foremost 
objective in the Doha negotiations, which is ‘to increase economic opportunities and prosperity for all 
Members by reducing impediments to trade and by enhancing predictability in the multilateral trading 
system’?  (WT/TPR/G/179, para 15)  ANSWER:   Canada is a strong supporter of an amb itious outcome to the Doha negotiations.  The 
Article XXVIII announcement must be put in persp ective – it only affects one type of products.  
Canada’s decision to invoke Article XXVIII was made as a result of the change in the tariff 
classification of milk protein concentrates resulting fro m rulings made by Canadian domestic courts in 
2005 and 2006.  The right to renegotiate tariff con cessions through Article XXVIII is a longstanding 
right under the WTO framework.  Overall, the aim of Article XXVIII negotiati ons is to maintain a 
level of concessions not less favourable to trade than that which existed prior to the negotiations.  The  WT/TPR/M/179/Add.1 
 Page 133 
 
 
results of a GATT Article XXVIII should therefore not  affect the overall level of our existing WTO 
commitments.  
 
[New Zealand Question 5] 
 Question 5 (a) on Domestic Programmes:   Would Canada elaborate on the rationale behind the 
continued expansion of its special milk class programme, administered by the Canadian Dairy Commission, which seeks to significantly discount the price of industrial milk and other domestic dairy ingredients?  
ANSWER:   The Special Milk Class Permits Program is now over 10 years old and the eligibility 
criteria and program parameters have essentially re mained the same over the period.  The products 
initially and still targeted by the program are prep ared and frozen food pro ducts (further processed 
products).  The occasional expansion of eligible produc ts is a reflection of the evolving nature of the 
dairy product mix offered to the Canadian consumer.  Further processed foods have been increasingly 
popular, over the years, due to changing consumer habits. 
 Question 5 (b):   How are exports of products made under this programme being notified to the WTO 
in relation to Canada’s e xport subsidies commitments? 
 ANSWER:   The October 1999 WTO Appellate Body decision clearly stated that the further 
processed products that are manufactured under classes 5 (a ), 5 (b) or 5(c) and exported do not have to 
be included in Canada’s notifi cations regarding its dairy prod uct export subsidy commitments. 
 Question 5 (c):  In this regard can Canada comment on th e disparity between the domestic prices and 
the discounted prices offered under the special m ilk class programme under classes 4(a)1, 5(a), (b) 
and (c)? 
 ANSWER:   The disparity between Special Class prices and the domestic prices  will vary depending 
on the dairy product or ingredient under considerati on.  For example, the product under Special Class 
prices in classes 5 (a) and 5 (b) are based on actual US component prices.  As for classes 5 (c) and 4 
(a) 1, prices are based on fluctuating world market conditions. 
 
Question 5 (d):   Can Canada comment on the reasoning behi nd the expansion of special milk class 
5(c) to allow for producers of frozen dairy pr oducts to access competitive prices for domestic 
ingredients?  
ANSWER:   The Special Class program has targeted, since its introduction, prepared and frozen 
products and 5 (c) in particular fo r confectionary products.  Ice cream novelties have been accepted by 
Canadian Milk Supply Management Committee (C MSCM) as a confectionary product and is a 
reflection of the evolving nature of the dair y product mix offered to the Canadian consumer. 
 The market conditions for these products are th e same domestically and internationally. 
 
Question 5 (e):   Would Canada explain whether the special milk class programme is designed to offer 
discounted industry milk/dairy ingredient prices in the production of dairy pr oducts already enjoying 
significant protection under Canada’s Uruguay Round ta riff schedule (including out of quota tariffs of 
up to 300%)?  (WT/TPR/S/179 paras 31-32) 
 
ANSWER:   Under the special classes, milk component s - butterfat and solids non-fat - are provided 
at various prices, with some falling below their r espective support prices while others do not.  These 
milk components are used for the production of ch eese (class 5(a)) or other dairy ingredients (class 
5(b)), which are used in further process products, su ch as confectionaries or frozen pizza.  There are 
no limitations on the sale of these products.  The speci al class program is desi gned to provide eligible WT/TPR/M/179/Add.1 
Page 134  
 
further processing companies with the means to take advantage of market opportunities in the further 
processing sector.  Cheese and dairy ingredients used  in the special classes are mostly covered by 
tariff-rate quotas.  
[US Question 11] 
 
Question 11:   We understand that Canada has an application system for reviewing and granting 
waivers to allow importation of bulk produce.  
What measures will the Canadian government take to  ensure consistency, tr ansparency and timeliness 
in the granting of such waivers?  
ANSWER:   The Canadian Food Inspection Agency pub lishes the national guidelines for Ministerial 
Exemptions on the Canadian Food Inspection Agency 's web-site to ensure there is transparency, 
consistency and timeliness.  The guidelines speak to  the roles and responsibilities of the applicant and 
the Canadian Food Inspection Agency.  They also  outline timelines for the processing of Ministerial 
Exemption applications. 
 
The Agency uses an electronic system to facilitate the Agency's granting of exemptions on behalf of 
the Minister.  Application information is entered electronically in the different areas of Canada which accessible to headquarter officials who may then gr ant and print the authorization, and notify the 
originating office/applicant and USDA of the details of the authorization. 
 
[US Question 12] 
 
Question 12 (a) on State-Trading Enterprises:   In paragraph 49, page 97, the Secretariat reports 
that a task force created by the Minister of Agriculture and Agri-Food recommended a four-phase 
transition of the Canadian Wheat Board (CWB) fro m one with “monopoly powers to an environment 
where farmers may sell their wheat or barley to any buyer.”  How does the government plan to work with the recommendations? 
 ANSWER:   The Task Force put together a proposal on how to implement marketing choice so that it 
benefits all grain farmers in W estern Canada.  The Task Force recommended a four-stage transition 
from a Canadian Wheat Board (CWB) with monopol y powers to a marketing choice environment: 
preparing for change, forming the new CWB, la unching the transformed CWB with transition 
measures and post transition.  The Task Force propos al is one comprehensive model of how the CWB 
could thrive in a marketing choice environment.  The Government encouraged farmers and grain 
industry stakeholders to provide their views and r eactions to the Government on the Task Force’s 
proposed model.   Question 12 (b):   What is the time frame for implementation, if any?  
 
ANSWER:   No time frame for implementation of marke ting choice has been set.  The Government is 
currently consulting barley producers on marketi ng choice through a plebiscite in which eligible 
producers are voting on the following three options:   - The Canadian Wheat Board should retain th e single desk for the marketing of barley 
  into domestic human consumption and export markets.  
 
 - I would like the option to market my barley to the Canadian Wheat Board or any    other domestic or foreign buyer.   - The Canadian Wheat Board should not have a role in the marketing of barley.  WT/TPR/M/179/Add.1 
 Page 135 
 
 
Question 12 (c):   Have steps been taken to elimin ate government guarantee of CWB’s initial 
payments to producers and borrowings?  ANSWER:   No steps have been taken to elimin ate the government guarantees of CWB’s initial 
payments to producers and borrowings. 
 
[EC Question 41] 
 
Question:   Most of the elements of the Canadian Agricultural Policy Framework (APF) expire in 
2008. 
 
As work is already underway to transform this  Framework, could Canada at this stage give 
preliminary information on foreseen changes in the APF and what impact they could have on future 
Canadian agricultural imports?  
ANSWER:   Agriculture and Agri-Food Canada (AAF C), along with provincial and territorial 
governments, are working with stakeholders to deve lop the next generation of agriculture and agri-
food policy.  Through a multi-phased, national c onsultations process, Canadians now have the 
opportunity to provide input and a dvice on how to best ensure a competitive and profitable agriculture 
sector in years to come.  This input will be consider ed as part of the federal, provincial, and territorial 
governments’ deliberation leading to implemen tation of policies and programs.  As these 
consultations are still underway and Federal-Provincial-  Territorial (FPT) deliberations have not been 
completed, it is not possible to predict the impact on imports of potential new policies. 
 
[EC Question 42] 
 Question:  Could it be explained to what purpose Cana da spent over CAN$5 billion over 5 years to 
implement the APF?  ANSWER:   To strengthen the agricultural and agri-food sector by developing a comprehensive and 
integrated national agricultural and agri-food polic y that:  (a) fosters confidence in food safety and 
food quality systems and the environment;  (b) accelerates advances in science and technology;  and 
(c) provides farmers with the risk management and re newal tools that they need in order to be more 
profitable.  
[EC Question 43] 
 Question:  How does Canada justify vis-à-vis releva nt GATT rules the tax exemption measure it 
applies to wines produced from Canadian grapes?  ANSWER:   The excise tax measures introduced in Cana da’s Budget 2006 are not trade distorting and 
will have no impact on imports of wi ne into Canada.  On average, imports account for 70% of wine 
sold in Canada.  The measures only apply to approxi mately 5% of Canadian wine production.  They 
are for the benefit of small producers, just as with similar programs in many other countries. 
 
[EC Question 44] 
 
Question on page 87, para.3:   In the Secretariat's report it is  stated that in some provinces, 
agricultural producer boards regulate the marketing of certain agricultural products, including by 
setting prices.   Do any of these agricultural boards re gulate or control the marketing of any agricultural products for 
exports? 
 WT/TPR/M/179/Add.1 
Page 136  
 
ANSWER:  Canada’s Consolidated Statutes and Regula tions includes the federal regulations that 
provincial boards have enacted to exercise thei r delegated Agricultural Products Marketing Act 
(APMA) authority;  that is, to regulate marketing or impose levies pursuant to  delegation orders.  In 
every case but one, the regulations apply to interpr ovincial and export trade, so are not specific to 
exports, e.g., the Manitoba Chicken Marketing (In terprovincial and Export) Order (SOR/88-465), and 
the Ontario Flue-Cured Tobacco Marketing (Interpro vincial and Export) Regulations (C.R.C., c. 186).  
The one exception is the B.C. Tree Fruit E xport Regulations (SOR/81-677), which essentially 
designate B.C. Tree Fruits Limited as the sole agen cy through which all tree fruit produced in B.C. 
must be marketed in export trade. 
 
[EC Question 45]  
Question on page 90-92, para 20-22:   Could Canada provide more de tail as to the type of milk 
protein concentrates to be covered under its recent decision to request GATT Article XXVIII 
negotiations, including the proposed changes to its customs tariff? 
 
ANSWER:   This issue will be addressed in the context of the Article XXVIII proceedings, including 
Canada’s upcoming GATT Ar ticle XXVIII notification.  
 
[EC Question 46] 
 Question on page 93, para 31:   Could Canada provide more deta ils on the recent decision to add 
'single serve ice cream novelties' as be eligible for Cl ass 5(c) special pricing?  In particular, how has 
this decision affected the domestic price for the dairy products used to produce these products? 
 ANSWER:   The Special Class program has targeted, since its introduction, prepared and frozen 
products and 5 (c) in particular for confectionary products.  Ice cream novelties has been accepted by 
CMSMC as a confectionary product and is a reflection of the evolving nature of the dairy product mix 
offered to the Canadian consumer.  The ice cream novelties that are eligible under Class 5 (c) since December 2006 are defined as follows: 
 
Single serve (not to exceed 300 ml) individually pack aged/sealed ice cream, i ce milk and frozen dairy 
desserts products destined for retail sale including bars, sandwiches, sundaes and stick products (e.g. 
fudgesicles).  Single serve frozen dairy novelties ma y be multi-packed (example, 8-12 single serve 
unites per box). 
 
The market conditions for these products are th e same domestically and internationally. 
 This decision does not affect the domestic price for class 2, which would include all other ice cream and frozen dessert products for the domestic market.  [EC Questions 47 and 48] 
 
Question on page 96, para.42:   Under the Agricultural Products Marketing Act (APMA), the Federal 
Government may grant provincial entities, including  boards and agencies, authority to "regulate the 
marketing of [any] agricultural product in interpr ovincial and export trade".  In some cases, these 
powers include the authority to set production quotas and prices. 
 Question 47:   Could Canada specify the amount of total support for farmers as a result of those local 
market regulation programs?  
Question 48:   How does Canada notify those local market support programs to the WTO?  WT/TPR/M/179/Add.1 
 Page 137 
 
 
ANSWER (to Questions 47 & 48):   Canada notifies domestic support in agriculture to the WTO 
Committee on Agriculture as provided for in Artic le 18 of the Agreement on Agriculture.  The 
notifications calculate Aggregate Measurement of  Support in accordance with the provisions of 
Annex 3 of the Agreement on Agriculture and taking into account th e constituent data and 
methodology used in the tables of supporting material  incorporated by reference in Part IV of 
Canada’s Schedule.  
 
[EC Question 49] 
 
Question on page 98, para.52:   The report states that the CWB has two export credit programmes, 
the Credit Grain Sales Program (CGSP) and the Agri-Food Credit Facility (ACF). 
 Could Canada specify the length of the repaymen ts periods under these export credit programmes? 
 ANSWER:  The Credit Grain Sales Program (CGSP) nominally provides credit guarantees on credit 
sales to sovereign buyers with terms of up to three y ears.  In practice, the program has not been used 
for new credit sales since the 2001/02 crop year.  Some old balances remain relating to sovereign 
debts which have been rescheduled.  For the Agri-Food Credit Facility (ACF), term limits ar e not set out by law or regulation.  In practice, 
where ACF guarantees are granted, they relate  to credits with terms of up to one year. 
 [Chile Question 4] 
 
Question on Domestic aid programs (Page 116 (page 92-96 in English version of report):  In this 
subtitle, reference is made to different types of domes tic aid.  How long does this aid last?  What kind 
of measures are these?  Are they temporary in nature ?  Could this aid eventually be transformed into 
subsidies?  ANSWER:  A description of Canada’s domestic program s related to the agriculture and agri-food 
sector can be found in section (iii) Domestic program s, Part 2:  Agriculture of Section IV. Trade 
Policies by Sector.  Additional information can be  found in Canada’s domestic support notification for 
2002 (G/AG/N/66) and also at:  http ://www.agr.gc.ca/index_e.php?s1=prog#a. 
 
[Colombia Question 40] 
 
Question 40:   In paragraph 11 the Secretariat says th at the federal and provincial governments in 
Canada signed the Framework Agreement on Agricultural Policy in order to make the agri-food sector 
more profitable through programs and services.  Could Canada explain in more detail the program s and services established under this agreement? 
 ANSWER:   The Agricultural Policy Framework (APF) is made up of five complementary elements – 
business risk management, food safety and quality,  science and innovation, environment, and 
renewal:  Business Risk Management  – Programs under Business Risk Management are designed to improve 
risk management.  The programs include the Canadian Agricultural Income Stabilization (CAIS) 
Program, Production Insurance, Farm Impr ovement and Marketing Cooperatives Loans Act 
(FIMCLA), Advance Payments Program (APP), Price Pooling Program (PPP), Spring Credit 
Advance Program (SCAP), and Private Sect or Risk Management Partnerships (PSRMP). 
 
Food Safety and Quality  – Canada is working with farmers a nd the industry to build on existing food 
safety measures while undertaking new measures to enab le the tracing of food products back to the WT/TPR/M/179/Add.1 
Page 138  
 
farm, improve food quality and share critical inform ation.  These measures will improve the sector’s 
ability to identify and respond to food safety issu es and concerns, while improving market access and 
opportunities for the sector.  Science and Innovation  – Canada is working together w ith industry to advance science and 
innovation in agriculture by coordinating scientific  efforts such creating value chains among all 
players to take the results of knowledge from the lab through to the marketplace, expanding and strengthening links with the scientific community , and improving technology transfer, coordination 
and communication.  
Environment  – Canada is working with industry to acceler ate efforts to reduce agricultural risks and 
explore environmental opportunities.  A sample of  programs under the APF environmental chapter 
include Environmental Farm Planning, Greencove r Canada, National Agri-Environmental Standards 
Initiative, National Agri-Environmental Analysis and Reporting Program, Nati onal Farm Stewardship 
Program, National Land and Water In formation Service, National Wa ter Supply Expansion Program, 
Pesticide Risk Reduction and Minor Use Program s, and the Shelterbelt Enhancement Program. 
 Renewal – Canada is working with the industry on th e goals of assisting farmers to increase their 
profitability, make choices about sources of inco me, meet market and consumer demands in food 
safety, food quality and environment, and capture opportunities from science and innovation.  A range 
of services are available for beginning farmers, mid-career farmers, and farmers who choose to pursue 
options off the farm. 
 
[Colombia Question 41] 
 
Question:  Paragraph 16 states that there are 21 tariff quotas that apply to imports of products subject 
to the supply management system. 
 For what products do quotas now exist?  How are the quotas allocated and administered?  How does the supply management system work?  ANSWER:   15 of the 21 Tariff Rate Quotas (TRQs) are for supply managed products.  These TRQs 
cover Turkey and Turkey Products ;  Chicken and Chicken Products;  Eggs & egg products; Broiler 
hatching eggs & chicks;  Fluid milk;  Butter; Y ogurt;  Ice cream; Cream;  Concentrated/condensed 
milk/cream; Powdered buttermilk;  Dry whey;  Cheese;  Other products of milk constituents 
(0404.90.10); Other dairy-based produc ts (1901.90.33).  Canada’s latest WTO notification on these 
tariff quotas covers 2005 (marketing year and cale ndar year) (G/AG/N/CAN/63, 20 October 2006).   
 
The terms and conditions governing Canada’s ta riff quotas are described in Canada's MA:1 
notifications (G/AG/N/CAN/2 dated 25 Sept ember 1995; G/AG/N/CAN/6 dated 19 August 1996; 
G/AG/N/CAN/10 dated 20 November 1995, G/AG/N/CAN/19 dated 11 March 1998 and 
G/AG/N/CAN/45 dated 2 August 2001).  
Canadian TRQs are administered by a variety of  methods, including methods based on first come: 
first serve, historical import performance, and on relative market share.  Access conditions are specified in several Allocation Method Orders i ssued under the Export and Import Permits Act.  The 
Act also provides for the administration of TRQs with in an import allocation regime.  The Minister of 
International Trade, who is responsible for the ad ministration of the Act, allocates quotas for goods 
subject to TRQs. 
 Imports at the within access (in-quota) rate of duty require a permit issued by the Department of Foreign Affairs and International Trade (DFAIT) to ap plicants that meet the requirements and pay the 
applicable fee.  Over-quota imports enter at a higher rate of duty under a general import permit for 
which no application is required.  Supplementary import permits may al so be authorized for re-export,  WT/TPR/M/179/Add.1 
 Page 139 
 
 
to meet domestic market shortages, or for test -marketing in which case the in-quota rate of duty 
applies.  Wheat and barley and their products are ad ministered on a first come, first serve basis at the 
border by the Canada Border Services Agency.  Information on TRQs and related formalities are pub lished in the Canada Gazette and in Notices to 
Importers; and are available on the Department of Fo reign Affairs and International Trade web site at 
the following address:  http://www.internati onal.gc.ca/trade/eicb/agric/agric-en.asp. 
 Canada’s dairy, poultry and egg sectors operate  under a supply management system whereby 
production (supply) is controlled through marke ting/production quotas to meet domestic demand 
which are allocated down to individual producers.  Supply management relies on predictable supplies 
- achieved through marketing/production quotas and import restrictions - in order to bring price 
stability to the market.  Imports are regulated th rough tariff quotas and high over-quota tariff rates. 
 
[Colombia Question 42] 
 
Question 42:   The Secretariat says that in Canada’s list of its commitments in the Uruguay Round, it 
specified for a few products the types of fees app lied inside and outside the quota but not the amounts 
of these quotas.  Could Canada explain how the amounts of the quotas are established?  How are these assigned 
volumes compatible with market acce ss under the Agreement on Agriculture? 
 ANSWER:   All of Canada’s market access commitments, including all tariff rate quota volumes, are 
listed under Canada’s Uruguay Rou nd Final Schedule of Agriculture Commitments (Schedule V). 
 [Colombia Question 43]  
Question:  What is the market distribution quota? 
 ANSWER:   The Market Sharing Quota, referred to in paragraph 30 of the Secretariat report, is the 
national milk production target for industrial milk  in Canada.  The Canadian Dairy Commission 
makes a recommendation to the Canadian Milk Supply Management Committee (CMSMC) on the 
MSQ.  This target is constantly monitored and is adjusted when necessary to reflect changes in 
demand, as measured in terms of butterfat, during the course of the year.  The National Milk Marketing Plan establishes each pr ovince's share of the MSQ, and provides for the 
sharing of any quota increase or decrease.  Each province allocates its respective share of the MSQ to 
its producers according to its own policies, and in accordance with pooling agreements. 
 The Commission monitors trends in Canadian Re quirements (demand) and production (supply) on a 
monthly basis.  Canadian Requirements are defined as total domestic consum er demand plus planned 
exports for industrial dairy produc ts.  Production includes all production of industrial milk and cream 
within supply management. 
 
[Colombia Question 44] 
 
Question:  Please indicate the non-tariff barriers that now apply to agricultural products. 
 
ANSWER:  Canada maintains import restrictions throug h applied tariffs as outlined in Canada’s 
Uruguay Round Final Schedule of Agriculture Commitm ents  (Schedule V).  Quantitative restrictions 
through tariff rate quotas are also listed in this Sche dule.  No duties, surcharges, or other taxes are 
applied to imports of agricultural products. 
 WT/TPR/M/179/Add.1 
Page 140  
 
[Colombia Question 45] 
 
Question:  Paragraph 27 provides information on the Grai ns Act and the Transport Law as amended. 
 Can Canada explain or provide more details  about these laws and their amended form? 
 
ANSWER:  The Canada Grain Act (CGA), administered  by the Canadian Grain Commission (CGC), 
establishes a quality assurance system for the Canadian grain industry by creating grades and standards, implementing a system of inspection,  and outlining procedures for grain handling and 
transportation.  The amendments re ferred to here require licensed operating elevators to report to the 
CGC the origin of all grain they receive and to re port to the CGC if they mix Canadian and foreign 
grain.  This allows the CGC to ensure that grain is not misrepresented as to its origin while in the 
grain handling system.  Prior to the amendmen ts, elevator operators were required to seek 
authorization from the CGC to receive foreign grain.  
The Canada Transportation Act (CTA) outlines the va rious requirements for tr ansportation in Canada 
by land, water and air.  The CTA in legislating na tional  railways contains specific provisions which 
provide the Canada Transportation Agency the aut hority to determine caps annually for revenues that 
national railways derive from the movement of west ern grain.  The regulation  provides for a cap on 
total railway revenue for specific western grain m ovements.  Bill C-40 changed the definition of  
grain to include eligible foreign grain and eligib le processed products legally imported into Canada 
and moved in the same manner as Canadian grain and products under the revenue cap provisions.  
Foreign grain and products would therefore re ceive the same treatment as domestic grain and 
products.  
[Colombia Question 46] 
 Question:  How do Crown corporations handle, operate a nd market wheat, barley and dairy products? 
 ANSWER :  The Canadian Wheat Board (CWB) is not a Crown corporation:  On June 11, 1998, Bill 
C-4, An Act to Amend the Canadian Wheat Boar d Act, continued the CWB as a shared governance 
corporation, without share capital, effective Decemb er 31, 1998.  The CWB is incorporated with the 
objective of marketing in an orderly manner, in in ter-provincial and export trade, wheat and barley 
grown in the CWB “designated area”, which includ es Manitoba, Saskatchewan, Alberta and the Peace 
River area of British Columbia.  Further informati on on how the CWB operates is available online at 
www.cwb.ca.  
The Canadian Dairy Commission has the mandate of coordinating federal and provincial dairy 
policies and setting production quotas that stabilize re venues and help to avoid production surpluses.  
Once a year, the CDC sets the support price of butter and skim milk powder following consultations with industry stakeholders.  The CDC also  monitors national pr oduction and demand and 
recommends the necessary adjustments to the national pr oduction target for industrial milk.  It has the 
authority to purchase, store, process, or sell dairy products on the domestic or export market, within 
WTO commitments. 
 
[Colombia Question 47] 
 
Question:  Paragraph 26 says that the Licensing and Arbitration Regulations prohibit the sale of 
imported fresh fruit and vegetables on consignmen t, as well interprovincial consignment sales. 
 How are policies on consignment sales handled in  the provinces of Canada and what are the 
interprovincial policies on consignment sales?   WT/TPR/M/179/Add.1 
 Page 141 
 
 
ANSWER:   The Licensing and Arbitration Regulati ons (LAR) made pursuant to the Canada 
Agricultural Products Act contain anti-consignment selling provisions.  Anti-consignment provisions 
require that all produce marketed have a firm purchase contract in place with a buyer prior to 
shipping.  However, the LAR also contain exemptions for persons who are members of the Fruit and Vegetable Dispute Resolution Corporation (DRC) .  Since the DRC has over 1,100 members, 
consignment selling is occurring for a majority  (approximately 90%) of transactions involving 
produce entering Canada and traded inter-provi ncially.  DRC Trading Standards (rules which 
members of the corporation must operate under) pe rmit consignment selling.  As such, consignment 
selling of product into Canada is likely occurring.  A majority of the produce entering Canada or 
traded interprovincially is no longer affected by the anti-consignment selling provisions of the 
regulations. 
 Intraprovincial trade is the jurisdiction of the provi nce.  Provinces do not have  any regulations related 
to controlling consignment selling.  Federal regulati ons regulate the interprovincial and import trade 
of fresh fruit and vegetables. 
 
[Colombia Question 48] 
 
Question:  From reporting on internal aid in 2000, c ould Canada say if prairie agriculture 
rehabilitation programs, aid for soybeans and pork, establishment of producer prices in the poultry 
and egg sectors, and the prices of butter and powdered skim milk made from certain classes of milk 
continue?  If so, could Canada indicate what th ese programs involve and the types of aid they 
include?  ANSWER :  Information regarding the function of the Prairie Farm Rehabilitation Administration, the 
factors underlying increases in support for soybeans and pork, the establishment of producer prices for 
poultry and egg, and the prices of butter and skim m ilk powder produced with certain classes of milk 
was provided to Members at the 43
rd Meeting of the Committee on Agriculture.  Canada’s responses 
to these questions are provided below (Table DS:1 ).  More recent inform ation can be found in 
Canada’s 2002 WTO domestic suppor t notification (G/AG/N/CAN/66). 
 WT/TPR/M/179/Add.1 
Page 142  
 
Table DS:1 Notifications from G/AG/R/43 
Canada G/AG/N/CAN/53   Domestic Support (Table DS:1) 
Points raised by other Members Response by Notifying Member 
Green Box 
Australia - 'Infrastructural services'  
Could Canada provide more details on the Prairie Farm 
Rehabilitation Administration and c onfirm that such services are 
directed to the provision or construction of capital works only and do not include subsidized on-farm facilities? 
  
The Prairie Farm Rehabilitation Administration (PFRA) offers 
technical assistance and in some cases financial assistance in a 
wide range of areas, including so il and water conservation, water 
supply development and waste water treatment, irrigation, 
rangeland management, community  pastures, shelter belts, 
engineering, surveying and dr afting, project management, 
economic planning and rural develo pment, integrated resource 
management, environmental analys is, sustainable agriculture, and 
wildlife and waterfowl habitat.  It is not possible to attribute this 
complex variety of activities to se parate Annex 2 categories, such 
as research, training, extension and advisory services, 
infrastructural services, other general services, environmental 
programmes and regional assistance programmes.  All PFRA 
operating and capital expenditures are therefore placed in the 
"Infrastructural services" category of Annex 2. As Canada has indicated previously (G/AG/R/23), the criteria applying to the different com ponent programmes have been 
monitored closely to ensure that the programmes reported under 
infrastructural services do not subsidize the provision of on-farm facilities, other than for the re ticulation of generally-available 
utilities. 
'Other', Annex 2, paragraph 5  
Which criteria of paragraph 5 of Annex 2 does the "technology 
innovation under the Quebec/Canada agreement" measure meet?  
This measure meets the criteria laid  out in the second sentence of 
paragraph 5. 
Amber Box 
Australia (cont'd) Calculation of Current Total AMS
 
Further details sought as to the nature of support to soybeans and 
the reason for the increase from Can$42.2 million in 1999 to Can$104.7 million in 2000.  
 
The soybean AMS consists main ly of price-related direct 
payments that stabilize revenue, as shown in Supporting Table DS:6.  The 2000 notification reports some payments based on 
crop year 2000-01 (e.g. Market Revenue Program), some on fiscal 
year 2000-01 (e.g. Ontario Grain Stabilization Payment), and some on calendar year 2000 (e.g. Assurance-Stabilisation des 
revenus agricoles).  The reporting year for a given program 
remains the same from notification to  notification.  In terms of the 
trend and level of support, soybean prices in crop years 1999-00 
and 2000-01 were very low.  As a result of the consistent 
reporting practice, this translates into higher notified payments in the notification for the 2000 reporting  year. 
Clarification sought as to whethe r the decrease in the level of 
support for pork from  Can$159.6 million in 1999 to Can$18.4 
million in 2000 will remain at this level in the coming years or 
whether this is only a temporary decline in support. The pork AMS consists mainly of price-related direct payments 
that stabilize revenue, as shown in Supporting Table DS:6. The 
amount of support reported under the price-related payments 
fluctuates depending on prices.  As such, Canada cannot predict whether support to pork will remain at this level in the future.  
However, unusually low pork prices in 1998 and 1999 made the 
payments unusually large in those years. 
United States - Explanation sought as to how the producer prices for the poultry and egg sectors are established.  For poultry, prices in Canada are negotiated between provincial 
poultry producer boards and primary poultry processors based on market conditions.  The Governme nt of Canada and the national 
supply management agencies have no role in poultry pricing. 
For eggs, each provincial egg boa rd sets prices for producers 
within its jurisdiction.  The grad ing stations pay these prices to 
processors and then sell these e ggs to the wholesale, retail and 
other sectors at negotiated prices.  The Government of Canada has 
no role in the pricing of eggs. 
Explanation sought as to the pric e received by, and the relationship 
with the applied administered pr ice, for butter and skim milk 
powder produced under Classes 5(a), (b), and (c), as product sales 
are excluded from eligible production.  The pricing mechanism for butter and skim milk powder produced 
in Classes 5(a), (b) and (c) bears no relationship whatsoever with 
the support prices established by the CDC for skim milk powder and butter which is destined for other uses.  Prices in Classes 5(a), (b) and (c) reflect prices in the US and/or world markets. 
  WT/TPR/M/179/Add.1 
 Page 143 
 
 
[Colombia Question 49] 
 
Question 49(a):  What is Canada’s policy for the milk and dairy products sector? 
 ANSWER :  The Canadian dairy sector operates unde r a supply management system.  In essence, 
supply management adjusts milk production with th e Canadian demand for milk products.  This goal 
is attained by controlling milk production th rough production quotas, administered pricing for 
producers and import controls for most dairy products.  Question 49(b):   How does the Canadian Milk Supply Management Committee (CMSMC) operate 
and who sits on it?  What is the National Milk Mark eting Plan and what fede ral-provincial agreements 
regulate milk supply?  ANSWER:  The National Milk Marketing Plan (NMMP)  is a federal-provincial agreement that 
regulates the marketing of industrial milk in Canada, in an effort to balance supply and demand.  It 
sets out the establishment, distribution and adjustment  of industrial milk quota.  The signatories to the 
NMMP are voting members of the Canadian Milk Supply Management Committee (CMSMC).  These include the federal government, represented by the Canadian Dairy Commission, provincial 
governments and provincial milk marketing boards.   The CMSMC oversees the application of the 
NMMP as well as another agreement, the Compre hensive Agreement on Pooling of Milk Revenues. 
Most of its decisions require unanim ity and each province gets one vote. 
 
Question 49 (c):   How are such programs compatible w ith the WTO’s Agreement on Subsidies and 
Countervailing Measures and the Agreement on Agriculture?  ANSWER:   The supply management system is consiste nt with Canada’s inte rnational obligations 
including those at the WTO.  Each year, the Ca nadian Dairy Commission announces the target price 
for milk.  From that price, we can derived support prices for butter and skim milk powder.  These two support prices are reported in Canada AMS calcu lations as required by the WTO Agreement on 
Agriculture.  In 1995, Canada tariffied all its dairy impor t quotas as stipulated in the WTO Agreement on 
Agriculture and subsequently reduced  them according to the schedule. 
 Following a WTO Appellate Body decision in Decembe r 2002, Canada has restricted its subsidized 
dairy products exports to the level nego tiated in the WTO Agreement on Agriculture. 
 
Canada’s supply management system complies with WTO’s Agreement on Agriculture as well 
WTO’s Agreement on Subsidies and Countervailing Measures.  
[Colombia Question 50] 
 
Question:  In paragraph 33, the Secretariat says that p oultry prices are negotia ted between provincial 
producer boards and primary poultry processing compan ies according to a form ula based on the cost 
of production.  How is the production cost formula determined?  
ANSWER:   Typically the cost of production formula for chicken is based on the sum of three 
elements: the observed cost of chicks, the observed cost of feed and a negotiated producer margin.  
The observed prices are updated for each production period, while producer margin negotiations 
occur annually.  WT/TPR/M/179/Add.1 
Page 144  
 
[Colombia Question 51] 
 
Question:  Paragraph 34 indicates that there are income support programs under the agricultural 
policy framework such as the Canadian Agriculture  Income Stabilization (CAIS) Program and crop 
insurance.  It also mentions support programs in the form of government guarantees and exceptional 
payments. 
 Please state the products now covered in these programs.  How are such programs compatible with the WTO’s Agreement on Agriculture?  
ANSWER :  The Canadian Agricultural Income Stab ilization Program is a whole-farm program 
available to eligible farmers rega rdless of what they produce.  Prod uction insurance was introduced in 
April 2003 to replace the Crop Insurance Program.  Production insurance is available for a broad 
range of products.  
The Advance Payments Program (APP) provides produ cers with a cash advance on the value of their 
agricultural products during a specified period.  By improving their cash flow throughout the year, the new APP helps producers meet their financial obliga tions and benefit from the best market conditions.  
The APP is accessed through producer organizati ons that administer the program through an 
agreement with Agriculture and Agri-Food Canada .  A list of eligible Participating Producer 
Organizations can be found at:  http://www.ag r.gc.ca/index_e.php?s1=p rog&s2=app&page=porg. 
 
Canada has notified APP in Supporting Table DS :7 “Product-Specific Aggregate Measurements of 
Support:  Other Product-Specific Support and Total Product-Specific AMS”.  The Transitional Industry Support Program conforms to Annex 2, paragraph 1 and the policy specific 
criteria under decoupled income support (paragraph 6).  The support is provided through a publicly 
funded government program not involving transfers from  consumers;  and does not have the effect of 
providing price support to producers.  Eligibility for payment is based on clearly defined criteria in a fixed and defined base period and the amount is not based on the type or volume of production, prices 
or factors of production employed in any year after the base period.  Further information can be found 
in Canada’s DS:2 notification (G/AG/N/CAN/65). 
 
The Farm Income Payment Program conforms to A nnex 2, paragraph 1 and the policy specific criteria 
under decoupled income support (paragraph 6).  Th e support is provided through a publicly funded 
government program not involving transfers from c onsumers; and does not have the effect of 
providing price support to producers.  Eligibility for payment is based on clearly defined criteria in a 
fixed and defined base period and the amount is not based on the type or volume of production, prices 
or factors of production employed in any year after the base period.  Further information can be found 
in Canada’s DS:2 notification (G/AG/N/CAN/65).  The Grains and Oilseeds Payment Program is consis tent with Canada’s WTO obligations and will be 
notified in the future. 
 
[Colombia Question 52] 
 
Question:  The Secretariat’s report says that the Government of Canada has the following internal 
assistance programs:  Agricultural Products Mark eting Act (APMA), Advance Payments Program 
(APP), price blending program, program under the Farm Improvement and Marketing Co-op Loans 
Act (FIMCLA), Transitional Industry Support Progra m (TISP) and Grains and Oilseeds Payments 
Program (GOPP).  Indicate in what category these programs belong and explain the criteria for classifying them under 
the WTO’s Agreement on Agriculture.  WT/TPR/M/179/Add.1 
 Page 145 
 
 
ANSWER:   Advance Payments Program has been notified in Supporting Table DS:7 “Product-
Specific Aggregate Measurements of Support:  Other Product-Specific Support and Total Product-
Specific AMS”.  Expenditures under the FIMCLA program are incl uded in Federal Credit Concessions in Supporting 
Table DS:9, Non-Product Specific Support in Canada’s DS:1 notification. 
 Canada has not made any payments under the Price Pooling Program since 1996.  This last payment was notified as “Ontario Wheat Deficit” in ST DS:6 of G/AG/N/CAN/35. 
 
[Colombia Question 53] 
 
Question:  Please provide more details on Canada’s agricultu ral export subsidies, in particular pricing 
of dairy products.  For these products, how do the credit programs and guarantees subsidized by the 
Canadian government operate? 
 
ANSWER:   Canada does not use credit programs and gua rantees for dairy exports.  Canada’s dairy 
export subsidies are provided through the special milk  class 5(d).  Under this special class, milk is 
provided at internationally competitive prices to processors for export production of dairy products. 
The quantities of butter, skim milk powder, cheese,  and other dairy products that may be produced 
and exported using milk from this  class are capped by the applicab le quantity or budgetary outlay 
commitment specified in Section II, Part IV, of Canada’s WTO Schedule. 
 Budgetary outlays are valued by comparing speci al class 5(d) component prices for each dairy 
product with prevailing domestic pric es on a component basis, i.e. for butterfat and solids-non-fat.  
The prevailing domestic prices used are the component prices that are calculated by the CDC to 
achieve the target return to producers for industr ial milk and set support pr ices for butter and skim 
milk powder.  The budgetary outlays are calcula ted as a running total each time a 5(d) permit is 
issued.  
(3) MINING AND ENERGY 
 
[US Question 13] 
 
Question:  Paragraph 63 on page 100 of the Secretariat re port explains that the Canadian government 
has continued to fund the development of renewable fuels.  
Does Canada provide tax exemptions on fuels containi ng ethanol, either at the national or subnational 
level?  If so, are there any eligibility requirements that relate to where the ethanol is produced?” 
 ANSWER:  The Federal government exempts ethanol from the fuel excise tax.  Any ethanol sold in 
Canada is eligible, regardless of origin of pro duction.  At the provincial level, some provincial 
governments also have tax exemptions for some biofuels. 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 7] 
 
Question on paragraph 63 of page 100:  As indicated in the Report, the Canadian government has 
continued to fund the development of renewable fuel s; e.g. the Wind Power Production Initiative and 
the Renewable Power Production Incentive. 
 What has been the impact of the incentive fundi ng and promotion measures for renewable fuels on 
fossil fuel substitutes?  WT/TPR/M/179/Add.1 
Page 146  
 
ANSWER:  With respect to the Wind Power Producti on Initiative, there are currently 22 wind 
projects across Canada representing 924 MW of new wind power capacity.  Then these projects are completed, Canada’s total wind power capacity will be about 1500 MW, a sevenfold increase over 
2002.  These wind projects help to displace fo ssil fuels such as coal and natural gas. 
 
The Renewable Power Production Incentive was never im plemented by the Canadian Government.  In 
January 2007, the Canadian Govern ment introduced the new ecoEnergy  initiatives, a set of focused 
measures to help Canadians use energy more e fficiently, boost renewable energy supplies and develop 
cleaner energy technologies.  It is too early to tell what the impact of these initiatives will be. 
 
Examples of the new ecoEnergy initiatives: 
 - Under the ecoENERGY Technology Initiative, th e Government will invest $230 million in 
 energy S&T to fund the research, devel opment and demonstration of clean energy 
 technologies. The Government is directing its energy technology funds toward increasing 
 clean energy supplies, raising energy effi ciency, and reducing pollution from conventional 
 energy sources. - The ecoENERGY Renewable Initiative will invest more than $1.5 billion through two  initiatives to boost Canada’s renewable energy supplies and create up to 4,000 megawatts of 
 renewable energy. - Natural Resources Canada will deliver th e ecoENERGY for Renewable Power program, 
 offering incentives for the production of power  from emerging renewable energy sources. 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 8] 
 
Question on paragraphs 64-65 of page 101:  The local (provincial) governments own and manage 
the natural resources within their respective jurisd ictions and empower regulat ions independently, but 
the Federal Government is responsible for the national policy framework as well as trans-border 
environmental impact and polices of national interest.  While there is a formal mechanism for periodic coope ration between federal, provincial and territorial 
governments on energy issues, we would be inter ested in knowing whether conflicts have ever 
occurred between these government bodies, especially in  promoting further development of the sector 
involved and in encouraging private investment a nd competition?  If so, what guidelines are followed 
to settle disputes?  ANSWER:  Energy issues can be raised through the Fede ral-Provincial-Territorial Council of Energy 
Ministers (CEM) either during their annual meeting or in writing.  During their annual meeting, CEM 
energy ministers can discuss the issue in question and if they deem it necessary direct their officials to 
work on the issue and report back to the Council in th e future.  Officials may elect to establish a Task 
Force (i.e., Pipeline Jurisdiction) or establish a seni or officials working group (i.e. Assistant Deputy 
Minister Electricity Working Group on mandatory reliability standards) to examine the issue and 
develop recommendations for C ouncil's review and approval. 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 9] 
 
Question on paragraph 67 of page 101:  As indicated, the National Energy Board (NEB) may grant 
long-term export licenses for oil, gas and electricity  only after due consideration has been given to 
meeting the long-term requirements of the Canadian public. 
 Although long-term export licensing is meant to ensu re a level playing field between Canadian and 
foreign consumers with regard to consumption of  Canada's oil resources, could Canada please give 
details of what this “due consideration” a nd open deliberation process actually consists of?  
Furthermore, how are these restrictions prevented from hampering fair competition?  WT/TPR/M/179/Add.1 
 Page 147 
 
 
ANSWER:  Crude oil, refined petroleum products, and natu ral gas liquids (NGLs) can all be lawfully 
exported from Canada either by securing a short-te rm export-order or a long-term export licence 
issued by the National Energy Board (NEB).  For s hort-term exports of one year or less in duration 
(two years or less for heavy oil), applicants must  file an application in accordance with the filing 
requirements of the NEB Act and the Export Regulations for "Short-Term Export Orders". 
 
The application is usually a form letter filed by the applicant containing the name and address of the 
company and requesting authorization from the Board to export crude oil, refined  petroleum products  
(gasoline, diesel, heating oil, av iation fuel, etc), or NGLs (propane, butane, pentanes, etc) from 
Canada.  There is no limit to the quantities that can  be authorized for export under a short-term order 
and there are very few countries that could be rest ricted by export controls from receiving Canadian 
petroleum exports.  Once an export-order is issued by  the Board, applicants can, if they wish, re-apply 
to have the export-order renewed once the initial pe riod expires or is about to expire.  The Board 
holds itself to a 48-hour service-standard for issui ng short-term orders which counts from the time the 
application is received at the Board to the time that the Board issues the authorization. 
 
To date, industry's preference has been to use Ca nada's simplified export-order process as their means 
of affecting exports of crude oil and petroleum pr oducts from Canada even on a quasi long-term basis 
due to the expeditious approval a nd renewal process and the unlimited nature of the quantities that can 
be exported under this type of authorization.  
The NEB Act and Regulations also provide for the issuing of long-term oil export licences of up to 
25 years in duration.  A long-term licensing process is almost by definition a much more involved process and would typically require a public hearing by  the Board to satisfactorily dispose of all the 
issues attendant to this type of an the application.  
The applicant is required to submit an application to  the Board in accordance with the form set out in 
the NEB Regulations and the Board's Filing Requirement s.  Then, in an open, public hearing process, 
the Board will hear the views of the applicant and in terveners to determine if the authorization of the 
export will be in the Canadian public interest.  In  doing so, the Board will give  due consideration to a 
number of issues that the Board deems relevant to  the application; these may include, but are not 
limited to:  the availability of long-term supply to service the proposed export, the availability of long-
term export markets, the availability of pipelines to be utilized to service the exports and the impact of 
the exports on existing and future pipeline capacity , the environmental effe cts of the export, the 
compliance of the export to the fair market access (FMA ) provisions of the NEB Act, etc.  To date, as 
already stated above, the Board has not received an y applications from industry for long-term export 
licences for crude oil or petroleum products. 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 10] 
 
Question on paragraph 67 of page 101:  The Report tells us that the NEB may also regulate export 
prices for oil and gas, but that, according to the authorities, this has rare ly happened and requires 
action by the Federal Government. 
 Does the Canadian government still have the inten tion of keeping these regulations in place?  In 
addition, how is such administrative supervisi on prevented from distorting the market competition 
mechanism?  
 
ANSWER:  Canada has not regulated the price of oil or gas exports since the market was deregulated 
in 1986.  According to the National Energy Board Act, the aut hority to regulate export prices actually rests with 
the Governor in Council.  This implies that the decision of whether or not to regulate export prices for WT/TPR/M/179/Add.1 
Page 148  
 
oil and gas rests with the Federal Government.  Given our commitment to market principles, the 
Canadian government does not in tend to regulate export prices for oil and gas in the future. 
 The Canadian government has no intention at this tim e to review the act or to make any amendments 
to it.  [Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 11] 
 
Question on paragraph 74 of page 102:  Electricity generation falls within the jurisdiction of the 
provinces, and some provinces are undergoing libe ralization and deregulation reform.  In the 
electricity sector, competition and federa l involvement varies between provinces. 
 We would appreciate further clarification of the Fe deral Government’s attitude towards these reforms, 
and we would like to know whether any overall polic y guidelines have been formulated?  In addition, 
how does the federal regulatory body, e.g. the NEB,  coordinate inter-provi ncial operations for both 
the deregulated and regulated markets in these provinces? 
 ANSWER:  The Federal Government is supportive of ope n and competitive markets and encourages 
them when it is appropriate.  No overall national policy guidelines have been formul ated for liberalization of electricity markets.  
Since electricity is primarily within the jurisd iction of the provinces, the first decisions in 
restructuring the industry must be taken by the provinces.  The National Energy Board (NEB) does not co-ordinate interprovincial operations.  The urgency of addressing restructuring issues varies across provinces and progress varies among 
provinces as a result of regional cost, supply and social factors.  For example, several of the provinces 
(Quebec, Manitoba, British Columbia) are mostly supp lied by large, integrated hydro generators on 
common river systems.  Thus, it would be very difficult to obtain more efficient generation by liberalizing markets.
4  On the other hand, Alberta and Ontario are the most advanced in restructuring.  
Alberta has moved to competitive retail markets and Ontario has chosen to partially restructure its 
electricity market.  Most Canadian provin ces provide access to thei r wholesale markets and 
transmission systems in order to obtain equiva lent access to markets in the United States. 
 In general, provinces are watching restructuring initiatives in other jurisdictions.  A number of 
jurisdictions have undertaken studies to assess the cost s and benefits of restructuring, but decisions 
have not been finalized at this time. 
 
(4) MANUFACTURING 
 
[Switzerland Question 8]  
 Question on Para. 77:   How do the Canadian authorities asses s the adjustment process that the 
manufacturing sector is going through:  to what ex tent can it be explained by the exchange rate 
appreciation (“Dutch disease” syndrome)? Can it be e xplained by a more structural component like 
increased competition from emerging economies (for example in the textile industry)?  Or by other factors?  
                                                     
 
4 It is arguable that the most efficient generation is obtained by coordinated generation dispatch by one 
entity.  It would be inefficient to have each hydro unit owned and operated by separate entities all making 
operating decisions based on real-time markets.  Further, it could lead to undesirable results in terms of flood control management, fisheries, recreation, and other interests on the water system.  WT/TPR/M/179/Add.1 
 Page 149 
 
 
ANSWER:  After approximately one year of consu ltations with leaders and organizations 
representing various manufacturing industries, the Canadian House of Commons’ Standing 
Committee on Industry, Science and Technology ha s released a report on the challenges facing the 
Canadian manufacturing sector. The report, “Manufacturing: Moving Forward - Rising to the Challenge” was tabled in the House of Commons on Feb. 6, 2007 and makes 22 recommendations to 
the federal government. 
 The report says Canadian industry has been challeng ed by the rapid rise in the value of the dollar, 
rising or unpredictable energy costs; increasing gl obal competition, particularly from China; skilled 
labour shortages, and excessive regulation. 
 
Recommendations are in the areas of taxation, ener gy, labour, trade, intellectual property rights 
protection, infrastructure, regulatory, and research , development and commercialization policies that 
the Committee believes will help the manufacturing sect or adapt to the challenges it is facing.  Report 
Link:  http://cmte.parl.gc.ca/Content/HOC/co mmittee/391/indu/reports/rp26 63393/indurp 05/indurp02 
-e.pdf 
 
[EC Question 50]  
Question:   Could Canada provide further information on  the development of its standards and other 
requirements for the automotive sector? 
 
ANSWER:  Canadian regulations are closely aligned with those of the United States.  In addition, 
Canada completes vehicle safety research in conjunc tion with both foreign governments and with its 
international research partners, such as the Soci ety of Automotive Engin eers, the International 
Standards Organization and such research groups as ESV (Enhanced Safety of Vehicles Program). 
Throughout the development of any regulatory initiative the government completes extensive 
consultation with interested stakeholders.  Befo re developing any regulatory initiative the Canadian 
government reviews all international standards and regulations available.  The government is also 
fully committed to the development of Global T echnical Regulations bein g developed through the 
United Nations.  
Canadian regulations are developed under a “self-certi fication” regime.  This means that the technical 
requirements must be extremely clear and well defined so that the test can be repeated in any laboratory in the world with the same results.  Manufact urers are free to complete the testing, and they 
maintain their records in the event that the government requests this documentation. 
 
[EC Question 51]  
 
Question:   Does Canada plan to further harmonise its dom estic provisions with those of international 
organisations and in particular UN- ECE regulations?  In particular, th e EC would be interested in the 
areas of self-certification with safety regulations, crash testing requirements, and bumper impact resistance requirements. 
 
ANSWER:   Canada currently has incorporated by re ference a few ECE regulations, such as lighting 
and theft protection requirements.  There are no plan s to extend this harmonization to include other 
ECE regulations.  ECE regulations have been deve loped for a “type approval” certification regime 
and they are not easily applicable in a “self-cer tification” environment, the regime under which 
Canadian regulations are developed. 
 In addition, many of the ECE and Canadian regula tions apply different requirements and are tested 
under different circumstances, such as are the case  for rear fuel system integrity and child seat 
regulations. 
 WT/TPR/M/179/Add.1 
Page 150  
 
While Canada does not foresee the introduction of  additional ECE regulations, there is full 
commitment to make the development of Global Technical Regulations (GTR) a success.  With regards to bumper requirements, it is Canada's  intention to allow manufacturers to either follow 
Canadian bumper testing requirements or those of the GTR, at the choice of the manufacturer, once 
the GTR is approved. 
 
[EC Question 52] 
 
Question:   Does Canada plan to allow for any particul ar flexibility and special compliance options for 
small volume manufacturers with low sales figures? 
 ANSWER:   The current Canadian Motor Vehicle Safe ty Act does not allow for flexibility for low 
volume manufacturers.  Every vehicle is expected to  meet the technical requirements in place on the 
date of manufacture.  (5) TELECOMMUNICATIONS AND BROADCASTING SERVICES  [New Zealand Question 6]  
Question on telecommunications and broadcasting services:  The Secretariat report 
(WT/TPR/S/179 para 99) notes that the Government of Canada has issued a policy direction to its 
telecommunications regulator to rely on market forces  to the maximum extent feasible.  Could Canada 
provide an update on how the regulat or is addressing regulatory reform? 
 ANSWER:   The Order Issuing a Direction to the Cana dian Radio-television and Telecommunications 
Commission (CRTC) on Implementing the Canadian  Telecommunications Policy Objectives (the 
Policy Direction) is an element of the Governme nt's broader telecommunications policy agenda to 
decrease regulatory burden and make regulation more efficient and effective through increased 
reliance on market forces.  The Policy Direction specifies criteria which must be met by any new regulatory measure to encourage effective regula tion.  In creating the Policy Direction, the 
Government is sending a signal to the CRTC, the market and the Canadian public concerning the 
government’s intended course for the evolutio n of telecommunications policy in Canada. 
 The Policy Direction came into force on Decemb er 14, 2006.  The Policy Direction applies 
prospectively, subject to statutory guidelines and to specifications outlined in the Order.  In November 
2006, the CRTC announced Telecom Public Noti ce CRTC 2006-14, a review of the Commission’s 
regulatory frameworks surrounding mandated access to wholesale services - frameworks which 
provide competitor access to incumbent networks at  regulated wholesale rates.  While the review 
began before the Policy Direction came into force,  the Policy Direction includes considerations which 
must be taken into account in co nducting this review.  Petitions r ecently brought to the Commission 
by Canadian firms have called for the CRTC to cons ider matters relevant to the Policy Direction.  
While the Policy Direction has only been in for ce for a short amount of time, the Government 
continues to follow how the document w ill affect the CRTC and its proceedings. 
 
[Singapore Question 2]  
Question on Services – Telecommunications:  In para 107 (page 109), the Secretariat has noted that 
all telecom facilities based common carriers must  be Canadian-owned and controlled, and 
incorporated under federal or provi ncial laws. Canada currently lim its FDI in facilities-based service 
providers to a combined maximum of 46.7% of voting shares, based on 20% direct ownership and 
26.7% indirect ownership.  In ad dition, not less than 80% of the members of the board of directors 
must be Canadian. 
  WT/TPR/M/179/Add.1 
 Page 151 
 
 
• It would be useful if Canada could indicate the prospects for liberalizing limitations on 
foreign ownership and control in the said telecoms sectors. 
 ANSWER:   Canada's Telecommunications Act requires that telecommunications common carriers be 
Canadian controlled and limits direct investment to 20% of the voting shares.  The limit on the voting 
shares for holding companies is 33 and 1/3%.  Th e maximum investment by foreign entities in an 
operating company is 46.7% (i.e. 20% of the operating company and 26.7% of the holding company (33 and 1/3% of the remaining 80%)).  Such carri ers must be controlled in fact by Canadians. 
 In March 2006, an independent panel of experts co mmissioned by the Government to review Canada's 
telecommunications policy and regulatory framework released its final report.  The report included 
127 recommendations to modernize Canada’s telecommunication re gime, including a proposal to 
amend the restrictions on foreign direct investment (FDI) in the sector.  The Government is examining 
the potential benefits and implications of in creasing foreign investment, along with all the 
recommendations of the report, but no deci sion has been made to amend Canada’s 
telecommunications FDI regime.  [Japan Question 9]  
Question on paragraph 107, page 109, (ii)  Institutional and legal framework:  We understand that 
in Canada, the Telecommunication Policy Review Pa nel, which was established by the Ministry of 
Industry, conducted a review of Canadi an telecommunications framework.  On 22
nd March 2006 the 
Panel proposed the liberalization of the restricti ons on foreign investment in telecommunications 
service providers, and recommended that in the fi rst stage, the new market entrants and the 
telecommunications common carriers with less than  a 10-percent market share be examined to 
liberalize the restrictions on foreign investment.  
 
In this regard, we would like to be informed of  the kind of liberalization plan that has been 
implemented, and what progress will be made co ncerning the relaxation and removal of such 
restrictions on the basis of the review.  ANSWER:   The Telecommunication Policy Review Pa nel made 127 recommendations to modernize 
Canada’s telecommunication regime in its final repor t, including a proposal to amend the restrictions 
on foreign direct investment (FDI) in the sector.  As  an initial response, the Government has issued a 
policy direction to the telecommunications re gulator, the Canadian Radio-television and 
Telecommunications Commission (CRTC), to rely on market forces to the maximum extent feasible 
to achieve Canada’s te lecommunications policy objectives.  While the Government continues to 
examine the potential benefits and implications of  increasing foreign investment, along with all the 
recommendations of the report, no decision has been  made to amend Canada’s telecommunications 
FDI regime.  
[Japan Question 10] 
 
Question on paragraph 111, page 109:  The secretariat report states that in the local 
telecommunication services, the incumbent local exchange carries (ILECs) are required to provide competitors with unbundled access under mandated pricing.  Are there any major suppliers in the mobile markets?  We would like Canada to elaborate on the 
provisions of laws and regulations which sti pulate interconnection rules (including unbundling 
obligations) for such major suppliers, if any, in mobile markets. 
 ANSWER:  With three national wireless service providers  in Canada, there is no major supplier in 
the mobile marketplace in Canada that  has the ability to materially affect the terms of participation.  WT/TPR/M/179/Add.1 
Page 152  
 
The market shares in 2005 for the three carriers are:  Rogers Wi reless 37.1%; BCE 32.5%; Telus 
27.2%.  The CRTC has the authority to mandate wireless/wi reless interconnection, pursuant to its powers 
under the Telecommunications Act, as does the Minister of Industry as a condition of spectrum 
license under the Radiocommunications Act.  The CRT C has the authority to require unbundling for 
the purposes of access by other providers.  There have only been a few case s where interconnection rules, incl uding unbundling, were required of 
the major wireless service providers.  Mandated roam ing on analogue cellular was required through a 
condition of license in 1995 to enable new entrants in the mobile service.  In 1995, wireless carrier 
license conditions mandated inter-carrier resale.  There are a few Mobile Virtual Network Operators (MVNO) in Canada.  They resell facilities/services provided by facilities-based wi reless carriers through commercial agreements 
between the carrier and the MVNO. 
 
[Japan Question 11] 
 
Question 11 (a) on paragraph 114, page 110:  With respect to the Voice over Internet Protocol 
(VoIP) services provided by ILECs, please explain why they are regulated only in the local telephone 
services.  Please provide further information on th e difference in requirements between local and 
long-distance services.  ANSWER:   In Canada, long distance services have been deregulated since 1992.  Long distance has 
developed into a highly competitive market in which regulation is not required for the achievement of 
Canada’s policy objectives.  Market  forces have resulted in customers being well served by a wide 
variety of high quality long distance service offeri ngs.  The introduction of IP-based services does not 
create a need for regulation of l ong distance; rather, it strengthens consumer choice and bolsters the 
case for reliance on market forces.  In addressing the issue of VoIP regulation, the re gulator determined, in essence, that the regime 
applied to traditional telephony would be applied to VoIP telephony.  Accordingly, the scope of VoIP 
economic regulation was limited to the local servic es of incumbent providers.  Subsequently, this 
scope was further narrowed by government varian ce of the regulator’s decision to include only 
incumbent local VoIP Services that ar e inseparable from the underlying access. 
 
Question 11 (b):   We understand that last year the Pane l Review did not recommend to deregulate the 
VoIP services which are provided through th e supplier’s own networks and facilities.  
 Please provide reasons for this and further inform ation on the deregulation plan in the future. 
 ANSWER:   The Telecommunications Policy Review Pane l issued its final report in March 2006.  
This report did not address specific regulatory issues such as the appropriate model for VoIP.  Rather, 
it focused on longer term broad policy issues.  The regulator’s decision on VoIP was changed by the 
government.  Local telephone services provided by Vo IP technology continue to be regulated as a 
local telephone service provided by a legacy netw ork when availability of the VoIP service is 
dependant upon the carrier’s network providin g access.  Where the VoIP service is “access 
independent”, that is, it can be accessed through an y broadband Internet connection, the provision of 
VoIP services has been forborne from economic regulation.   WT/TPR/M/179/Add.1 
 Page 153 
 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 12] 
 Question on paragraph 109 of page 109:   As indicated, Spectrum licenses for wireless operations 
are granted by Industry Canada.   
 Could Canada please clarify whether the limit on foreign direct investment in wireless services is the 
same as that for facilities-based services, with a co mbined maximum of 46.7% of voting shares?  Is 
there any other restriction applying to foreign investment in wireless services? 
 
ANSWER:  Facilities-based wireless service providers ar e subject to the Telecommunications Act as 
telecommunications common carriers.  Facility-based wireless service providers are therefore subject 
to the same foreign investment limitations as other facilities-based telecommunication service 
providers.  The foreign investment limitations appl y as well to the issuance of radio spectrum licences 
for wireline carriers.  [EC Question 53]  
Question on page 109, para. 104-110:  Could Canada provide inform ation on how the level of 
license fees is determined? 
 ANSWER:   A nominal annual fee of $100.00 is required for a license to construct and operate a 
submarine cable.  License fees for the operation of satellites and satellite earth stations are subject to 
nominal fees for the issuance and renewal or reinst atement of the licenses.  The applicable fee is 
determined by the type of station licensed and the ty pe of service used.  In certain cases, the amount 
of radio frequency spectrum requi red or number of frequencies assigned and the location of 
operations are also taken into account.  Typically, fees for spectrum licenses take into consid eration the type of service to be provided, the 
bandwidth assigned and population within  the serving territory, whether it is exclusive or shared use, 
and if it will be used by commercial or private systems. 
 Canada requires a license for the provision of Basi c International Telecommunication Services (BITS) 
but there is no associated license fee.  [EC Question 54]  
Question on page 109, para. 106:  What assessment has been done on th e impact of the restrictions 
on foreign ownership for the development of competition in the market?  ANSWER:   In March 2006, an independent panel of experts commissioned by the Government to 
review Canada's telecommunications  policy and regulatory framework released its final report.  The 
report included 127 recommendations to modernize Canada’s telecommunication regime, including a 
proposal to amend the restrictions on foreign direct  investment (FDI) in the sector.  The panel found 
that the economic arguments supported the liberalizati on of the investment restrictions, but proposed a 
phased-approach to liberalization to address Canada’s  other policy objectives; in particular, Canada’s 
broadcasting policy.  The Government continues to assess the benefits and implications of the panel’s 
proposal.  
[EC Question 55]  
 
Question:   According to which timeframe is Canada  planning the lifting of foreign ownership 
limitations? 
 WT/TPR/M/179/Add.1 
Page 154  
 
ANSWER:  The Telecommunication Policy Review Pane l made 127 recommendations to modernize 
Canada’s telecommunication regime in its final repor t, including a proposal to amend the restrictions 
on foreign direct investment (FDI) in the sector.  While the Government continues to examine the 
potential benefits and implications of incr easing foreign investment, along with all the 
recommendations of the report, no decision has been  made to amend Canada’s telecommunications 
FDI regime. 
 
[EC Question 56] 
 
Question:  Fixed to mobile termination rat es are not imposed nor published. 
 
Does this apply also in the case that there is domi nance in the market?  How does Canada ensure that 
prices are not excessive in the case that dominance is found?  ANSWER:   Interconnection rates between fixed line carriers and mobile carriers are set by tariffs 
approved by the CRTC. 
 
[EC Question 57]  
Question on page 110, para. 111-112:   Could Canada inform whether there is a certain time limit 
within which an interconnection dispute needs to be resolved? 
 
ANSWER:  There is no legislated time limit for inte rconnection dispute resolution.  Often, CRTC 
staff will meet with the disputants to broker an ag reement.  After 30 days of  ‘good-faith negotiations’, 
either party may refer the dispute to the CRTC for resolution or the parties may agree to refer the 
dispute to arbitration.  Considerations of the impor tance to stakeholders of rapid resolution serve to 
impose time limits. 
 
[Colombia Question 58]  
Question:  Since the Secretariat’s report does not men tion e-commerce, Colombia would appreciate 
Canada providing information on its policy in this area.  
ANSWER:  Canada believes that electronic commerce (e-commerce) can foster remarkable new 
business efficiencies.  It gives small and medium-s ized enterprises access to much wider geographical 
markets, and for consumers around the globe it prov ides the benefits of increased competition and 
products choice.  Such benefits are contingent upon an affordable access to infrastructure and e-
commerce-related services, as well as, on-line environment of trust and security. 
 At the domestic level, the department of Indus try Canada is leading Ca nada’s policy and legal 
framework on e-commerce.  Canada is a world lead er in the adoption, use and development of e-
business and Industry Canada aims to build on th is foundation to support and facilitate continued 
growth of e-business in the Canadian economy. 
 
Various policy instruments are already in place to provide for the security, privacy and consumer 
protection in on-line  transactions, such as: 
• Cryptography Policy allowing domestic use of any strength cryptography;  
• Consumer Protection Guidelines and Code of Practice for on-line transactions;  
• Policy Framework and regulations for the Public  Key Infrastructure (PKI)  for Government 
on Line;  
• Privacy legislation for the protecti on of personal information; and  
• Marketplace Principles for Electronic Authentication 
  WT/TPR/M/179/Add.1 
 Page 155 
 
 
Canada has also established a legal framework for el ectronic signatures.  (Legislation exists at the 
federal level (and in most provinces) that provide  for electronic signatures and electronic documents 
to be equivalent to written form.  In addition, it has developed a policy framework that provides for 
business and citizens to do transactions with the government in a secure and confidential manner. 
 
The following links provide more information on the above issues: 
• Privacy:  http://e-com.ic.gc.ca/epic/s ite/ecic-ceac.nsf/en/h_gv00045e.html  
• Security & Cryptography:  http://e-com.ic.gc .ca/epic/site/ecic-ceac .nsf/en/h_gv00084e.html 
• Identity Theft:  http://e-com.ic.gc.ca/ epic/site/ecic-ceac.nsf/en/h_gv00171e.html  
• Task Force on Spam: http://e-com.ic.gc.ca/ep ic/site/ecic-ceac.ns f/en/h_gv00248e.html 
 Canada is very active internationally in prop osing and implementing policies and strategies to 
promote the growth of electronic commerce.  Fr om a trade perspective, Canada believes that 
electronic commerce provides new ways of doing business, opens new business opportunities and that 
it is still commerce rather than a new sector.  Cana da considers that existing multilateral agreements 
and frameworks already apply to electronic commer ce and that greater clarity in applying existing 
international trade rules to electronic transactions is needed.  The following links can provide information on Cana da’s international activ ities and perspectives on 
e-commerce: 
 
• Trade and e-commerce:  http://www.dfait-maec i.gc.ca/tna-nac/FO/ecom-en.asp;  http://e-
com.ic.gc.ca/epic/site/ecic-ceac.nsf/en/h_gv00175e.html 
• International Agreements:  http://e-com.ic.gc .ca/epic/site/ecic-ceac .nsf/en/h_gv00177e.html 
 
[Colombia Question 59]  
 Question:  Paragraph 100 provides full information w ith statistics from 2005, showing total income 
from telecommunication services (except broadcasting) of 34.5 billion Canadian dollars, an increase 
of 3.5 per cent over the previous year.  Most of this increase is due to higher income from broadband 
and wireless Internet services.  Information is also  provided on wireless services, the largest sector of 
the Canadian telecommunications market, and on market shares. 
 Are all licensed companies public operators?  Ar e licensed companies considered major suppliers? 
 
ANSWER:  Canada only requires licences for the provision of basic international telecommunication 
services.  Domestic service providers do not require  licenses to provide public telecommunications 
services.  A licensed provider of basic intern ational telecommunication services is only a major 
supplier if it has the ability to materially affect th e terms of participation for these services.  Wireless 
carriers require a licence under the Radiocommunicat ions Act for the use of the radio spectrum. 
 
[Colombia Question 60]  
 
Question:   What are the extraterritorial operations?  Do these operations have anything to do with 
obligations for worldwide service? 
 
ANSWER:  In the past, telecommunication services were  provided exclusively by incumbent local 
exchange carriers (ILEC) with separate regional serving territories.  Since then, Canada has 
liberalized telecommunication services and permits comp etition.  Out-of-territory operations are the 
Canadian operations of an ILEC outsi de of its traditional serving territory. 
 WT/TPR/M/179/Add.1 
Page 156  
 
[Colombia Question 61]  
 
Question:   According to paragraph 102, Canada’s te lecommunication commitments under the Fourth 
Protocol of GATS cover practically all services.  Canada’s list of specific commitments excludes 
services regulated by the Broadcasting Act, which includes telecommunication services provided to 
transmit programs received directly by the public (t hat is, television services broadcast directly to 
homes and direct satellite broadcasting).  No r estrictions are placed on improved or value-added 
services.  What regime applies to providers of value-added services?  
 
ANSWER:  Canada does not generally regulate value-added services.  These services are subject to 
laws of general application, such as competition,  consumer or privacy laws.  Economic regulation 
may be applied when a value-added service, such  as voice-mail, is offered by a regulated carrier 
together with a regulated service as a bundle of services with one set price. 
 
[Colombia Question 62] 
 
Question:  Paragraph 108 says that dealers and pr oviders of local and long-distance 
telecommunication services who have installations n eed only register with the CRTC, while providers 
of international services must be licensed.  To  provide local telephone services, companies must 
register within the CRTC as a competitive local exchange carrier (CLEC). 
 What is the difference between a CLEC and an ILEC? 
 
ANSWER:  ILEC (incumbent local exchange carrier) re fers to the incumbent telephone companies 
that provided telecommunication services on a monopoly basis prior to the introduction of 
competition.  CLEC (competitive local exchange carrier) refers to carriers which offer local telecommunications 
service in competition with the incumbent service providers. 
 
[Colombia Question 63]  
 
Question:  Are suppliers who do not have their own installations allowed to sell services? 
 
ANSWER:  Resale of basic telecommunications services is allowed.  Up to 100% foreign investment 
is allowed in service providers of basic telecommunications services supplied on a resale basis. 
 
[Colombia Question 64]  
 
Question:  What are the differences in terms of time and administrative and other costs between 
registering with the CRTC and acquiring a licence? 
 
ANSWER:  Fees are not required to register with the CRT C, or to acquire a licence.  A carrier is 
registered with the CRTC following the receipt of th e request to register.  For licences, the CRTC will 
issue a licence after the application has been ava ilable for public comment for 21 days and no adverse 
comments have been received.  The filing require ments will depend upon the type of service to be 
provided. 
 
[Colombia Question 65]  
 Question:  What is the reason for requiring a licence only from providers of international services? 
  WT/TPR/M/179/Add.1 
 Page 157 
 
 
ANSWER:  Canada introduced a licensing regime for pr oviders of basic international services to 
ensure that foreign monopolies cannot use their dom inance in their home markets to gain an unfair 
competitive advantage in the Canadian market, and to minimize barriers to entry for new service 
providers by enforcing provisions against anti-competitive practices. 
 
[Colombia Question 66]  
 
Question:  How are providers of international services defined? 
 ANSWER:  There are two classes of international service providers in Canada. 
 
A Class A licensee is a telecommunications service provider who operates telecommunications facilities, whether owned by them or leased from a separate facilities provider, used in transporting basic telecommunications service traffic between Ca nada and another country; and/or those who 
operate telecommunications equipment that converts  (i) circuit-switched basic international minutes 
originating in Canada to non-circuit switched traffi c, or (ii) non-circuit switched traffic originating 
outside of Canada to basic minutes terminating in Canada. 
 A Class B licensee is a telecommunications service provider who neither operates telecommunications facilities owned by them or l eased from a separate facilities provider used in 
transporting basic telecommunications service traffi c between Canada and a nother country.  This 
includes service providers who only resell the switched services of other service providers or who 
hand off all of their international traffic to anot her service provider in Canada for termination in 
another country.  
[Colombia Question 67]  
 Question:  Paragraph 111 says that the CRTC requires incu mbent local exchange carriers (ILECs) to 
provide competitors with unbundled access to essential facilities (including access to local circuits) at 
set rates.  The CRTC also requires ILECs to provide  interconnections for competing companies.  The 
CRTC requires equal sharing of costs in establishi ng trunk circuit connections in each predetermined 
connection region and adopts a billing conservation a pproach to compensate for termination of calls. 
 
What is the billing conservation approach to  compensate for the termination of calls? 
 
ANSWER:  For compensation for the termination of calls, the CRTC adopted a “bill and keep” 
approach whereby, within appropriate limits, or iginating carriers are not required to compensate 
terminating carriers for the costs of completing calls  from the former to locat ions within the same 
incumbent carrier exchange.  In in stances where traffic is not balanced between carriers, a “mutual 
compensation” approach may be implemented where by compensation is paid at an approved rate for 
the termination of calls based on terminating minutes.  
[Colombia Question 68]  
 
Question:  What is the interconnection regime for private networks? 
 
ANSWER:  Canada does not regulate the interconnection of private networks.  The connection of 
private networks to public networks takes place us ing commercially available services, some of which 
may be regulated.  
 WT/TPR/M/179/Add.1 
Page 158  
 
[Colombia Question 69] 
 
Question:  According to paragraph 114, the CRTC regulates voice over Internet protocol (VoIP) 
services only when they are supplied and used as local telephone services.  To prevent ILECs from 
abusing their market power, the CRTC requires them to charge rates for these services that depend on 
access to the supplier’s own network.  ILECs are also limited by all existing regulations when 
promoting the service with former customers. Computer-to-computer VoIP services are not regulated. 
 
What regime apples to local telephone services provided by the Internet protocol (VoIP)? 
 
ANSWER:  Local telephone services provided by VoIP technology are regulated as a local telephone 
service provided by a legacy network when availability of the VoIP service is dependant upon the carrier’s network providing access.  Where the VoIP service is “access independent”, that is, it can be 
accessed through any broadband Internet conn ection, the CRTC has forborne from economic 
regulation.  
 
(6) FINANCIAL SERVICES 
 [Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 13] 
 Question:  (paragraph 136 of page 115, and paragraph 146 of page 117) 
As indicated in the Report, deposits in full-servi ce branches are not covered by deposit insurance and 
full-service branches of foreign banks are not elig ible for membership of the Canada Deposit 
Insurance Corporation (CDIC). 
 
Could Canada please explain the reason why branches of foreign banks are denied CIDC membership 
and would it consider removing such restriction? 
 
ANSWER:  Branches of foreign banks are more lightly regulated than subsidiaries or incorporated 
financial institutions.  In add ition, foreign bank branches have much lighter capital adequacy 
requirements than do subsidiaries.  As such they are restricted from engaging in certain activities, 
such as retail deposit-taking.  Given this restric tion, foreign bank branches are not required to be 
members of CDIC, and pay the deposit insurance pr emiums.  At the present time, Canada is not 
contemplating removal of these restrictions.   
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 14] 
 Question:  (paragraph 136 of page 115, and paragraph 146 of page 117) 
We have noted also that full- service branches of foreign banks may take deposits of C$150,000 or 
more and that all banks taking de posits of less than C$150,000 must be members of the Canada 
Deposit Insurance Corporation (CDIC).  However,  as mentioned above, full-service branches of 
foreign banks are not eligible for CDIC member ship, which effectively excludes them from taking 
deposits of less than C$150,000.  
Would Canada kindly explain the ra tionale behind these regulations and will it consider removing 
such restrictions on foreign bank branches? 
 
ANSWER:  The policy rationale is simply that given the lighter regulatory supervision and capital 
requirements Canada has sought to limit branches to s ophisticated customers and, therefore, restricted 
the size of deposits they could take.  Canada is not contemplating removal of these restrictions. 
  WT/TPR/M/179/Add.1 
 Page 159 
 
 
[The Separate Customs Territory of Taiw an, Penghu, Kinmen and Matsu Question 15] 
 
Question:  It is understood that some local governments do not recognize guarantees or L/Cs issued 
by authorized foreign banks for their customers. 
 In the interests of enhancing the transparency of related restrictions, standards or decisions made by 
local governments, would Canada consider grantin g equal treatment to both domestic and foreign 
banks in this respect?  
ANSWER:  Canada affords full national treatment to fore ign banks operating in Ca nada, and, in this 
regard, is not aware of existing local government me asures that do not provide equal treatment to both 
domestic and foreign banks in respect of recognizing  guarantees or lines of credit.  Can The Separate 
Customs Territory of Taiwan, Penghu, Kinmen and Matsu please identify where such discrimination 
at the local level exists.  [Honduras Questions 14] 
 
Question 14(a):  “Paragraph 121 on (page 142 Spanish versi on, page 112 English version) says that 
[translation ] “in March 2006 there were three more forei gn bank branches than three years before.  
All national banks were privately owned.” 
 What is (are) the nationality (nationa lities) of the foreign bank branches? 
 ANSWER:   The names of the foreign bank branches and th e type of branch (e.g., full service branch, 
or lending branch) established are listed on the website  of the federal financial institutions regulator, 
the Office of the Superintendent of Financial Institutions (OSFI)  –  http://www.osfi-bsif.gc.ca/. 
 Question 14(b)  Does federal and/or provincial  legislation apply to them? 
 ANSWER:   The banking sector in Canada is federally regulated. 
 
Question 14(c)  Is provincial legislation subject  to Canada’s WTO commitments? 
 ANSWER:  As is the case for federal government me asures, provincial government measures are 
subject to the WTO General Agreement on Trade in Services (GATS) , provided commitments are 
scheduled in respect of provincial measures. 
 
[Honduras Question 15] 
 
Question:  Paragraph 131 on (page 144 Spanish version,  page 114 English version) says that 
[translation ] “the Government intends to eliminate the re quirement for the Department of Finance to 
approve the entry of "quasi banks ".  These foreign entities provide banking services such as consumer 
loans, but in their national jurisdiction, they are not subject to banking or similar regulation.”  Could Canada expand on what it means by “quasi bank s”?  How do they operate?  Do they require a 
licence or permit?  What authority regulates them? Do es federal and/or provincial jurisdiction apply? 
 
ANSWER:   The term in English for the type of financ ial entity in question here is a “near” bank.  
Canada’s foreign bank entry framewo rk is principally directed to real foreign banks; that is, foreign 
banks regulated in their home jurisdiction as banks  (e.g. Citigroup, Deutsche Bank etc.).  A second 
part of the framework deals with near foreign banks; that is, fore ign banks that conduct limited 
financial operations in Canada a nd are unregulated finance compani es in their home jurisdiction.  A 
test for determining whether a foreign bank is “real” or “near” is set out in the Bank Act .  However, as WT/TPR/M/179/Add.1 
Page 160  
 
a general benchmark, foreign banks with less than 35% of their worldwide assets in banking 
operations are deemed to be near foreign banks.  Currently, near foreign banks obtain a one-time entry approval from the Minister.  They are not subject to any restrictions on their operations or investments in Canada.  As indicated in the TPR 
Report (paragraph 131 of the Englis h version), further to the current  review of the financial sector 
regulatory framework, Canada is proposing to eliminat e the requirement for the Minister of Finance to 
approve the “entry” of near banks.  
[Honduras Question 16] 
 Paragraph 137 on (page 146 Spanish version and page 115 English version) indicates that foreign 
bank branches are subject to the same restrictions.  Question 16(a):  Can Canada provide more detail on the rest rictions to which foreign bank branches 
are subject? 
 Question 16(b):   To what types of restriction does it refer? 
 Question 16(c):   How is this related to Canada’s WTO commitments? 
 
ANSWER (to Question 16 (a), (b) and (c):   In Canada, banks generally  have different business and 
investment powers than non-bank financial institu tions.  This distincti on between banks and non-
banks is captured in Canada’s fo reign bank entry regime, which attempts to mirror the treatment of 
foreign banks that wish to operate in Canada  with that of their domestic counterparts. 
 
The foreign bank entry regime offers real forei gn banks the same opportunities to offer financial 
services in Canada as domestic banks .  Real foreign banks that do not
 offer any financial services in 
Canada, however, generally have no restrictions on their activities or investments in Canada.  
Canada’s schedule notes that banking commitment s, including the different forms of commercial 
presence are made pursuant to the Bank Act .  
 
In terms of investment and business powers, real fore ign banks that wish to offer financial services in 
Canada may choose to offer these services thr ough a number of different Canadian financial 
establishments (similar to domestic banks), wh ich include bank subsidiaries, other financial 
institutions, foreign bank branches and unregulated finance entities.  
For example, foreign banks may choose to offer fi nancial services in Canada through the following 
Canadian financial services establishments:  
• Canadian bank subsidiary (full banking powers,  including retail deposit taking; deposits are 
insured by CDIC; regulated); 
• Full-service foreign bank branch (full banking  powers, except cannot accept retail deposits 
(i.e. deposits of less than $1 50,000); no CDIC insurance; le ss regulation than a bank 
subsidiary); 
• Lending foreign bank branch (full lending a nd asset powers; cannot accept deposits of any 
kind; no CDIC insurance; very limited regulation). 
 These various forms of entry allow foreign banks di fferent ways to conduct business in Canada and 
make the same types of investments that domestic banks are permitted to make .  Foreign banks that 
offer financial services in Canada through a Canadi an financial services establishment may choose to 
invest in the following types of Canadian entities: 
  WT/TPR/M/179/Add.1 
 Page 161 
 
 
• Canadian federally or provincially regulate d financial institutions (other than banks); 
• Unregulated financial intermediaries or agents; 
• Non-financial services entities that engage in  activities that a bank can engage in (e.g. 
information services entity); 
• Service entities (i.e. provide services to the foreign bank group); 
• Other related entities (e.g. mutual fund entities, real property brokerage entities). 
 Foreign banks, however, may not
 own Canadian commercial entities, and may not  engage in activities 
in Canada that Canadian banks are not allowed to engage in (e.g. auto leasing and high loan-to-value 
mortgages), either directly through the foreign ba nk or indirectly through any of its subsidiaries. 
Additionally, foreign banks may be granted excep tions to conduct certain activities based upon their 
current authorized practices in their home jurisdiction.  Foreign banks are permitted to acc ept deposits in Canada, but only through a regulated deposit-taking 
financial institution.  Similar to the choices ava ilable to Canadian banks, real foreign banks may 
choose to invest in Canadian entities either dir ectly or through a Canadian bank (or other) holding 
company.  
[Honduras Question 17] 
 
Paragraph 143 on (page 147 Spanish version, and 1 17 English version) says that OSFI has published 
reporting criteria and requirements that must be me t to establish and operate foreign bank branches. 
 Question 17(a):   Is the document published by OSFI available on any Web site? 
Question 17(b):  Can we obtain a copy of the document? 
Question 17(c):  Can Canada provide more  details on the document, as well as the criteria and 
requirements that must be met to establish bank branches in Canada? Question 17(d):   Does federal and/or provincial jurisdiction apply? 
 ANSWER (to Question 17):   The Office of the Superintendent  of Financial Institutions’ website 
http://www.osfi-bsif.gc.ca/ has a section dedicated to  foreign bank branching.  This section includes 
on-line information on Acts and Regulations, Application and A pproval Guidelines, Supervisory 
Practices, as well as Filing Instructions, Returns a nd Penalties.  In addition, this Section includes a 
part dealing with Guidance in respect of prude ntial supervisory practices, accounting and capital 
advisories, and rulings, and a part c ontaining draft and consultation papers. 
 
[Chile Question 5] 
 Question on (iii) Insurance Services (Page 151  (page 119 in English version of report) 
Paragraph 156:   The report states that insurance companies must obtain a licence in each province to 
conduct business, and that this could complicate access  to the market by foreign providers.  What 
percentage of licences is held by foreign providers?   Of the foreign providers who request licences, 
how many are rejected?  ANSWER:   Please see paragraph 155 of the Report whic h indicates the ways in which a foreign 
insurance company may establish in Canada.  By way of background, federally-incorporated insurance companies do not have to meet provincia l residency requirements.  As a general rule, 
residency and other governance requirements are found in the statute pursuant to which a company is 
incorporated.  If a company is incorporated under fe deral insurance legislation, it must govern itself 
according to federal rules. Similarly, if a co mpany is incorporated under provincial insurance 
legislation, it must observe provincial governance ru les.  However, for market conduct rules, such as 
licensing, marketing, sales practices, consumer prot ection, the company must follow provincial laws WT/TPR/M/179/Add.1 
Page 162  
 
regardless of whether it is federally-or provincially- incorporated.  This is a product of our Canada’s 
federal constitutional framework.  Table IV.2 on page 113 of the Report provides a br eakdown for the insurance sector by number of 
foreign institutions and by assets.  In general, foreign firms are more active in the property and 
casualty sector, with the life insurance sub-sector tending to be more represented by domestic firms.  
Paragraph 155 also notes that since 2003, 14 applica tions for letters patent of incorporation were 
reviewed, with two applications withdrawn. 
 
[Colombia Question 54] 
 Question:  Paragraph 7 says that the financial sector in Canada is well devel oped, diversified and 
profitable.  The banking sector is open to foreign competition, but restrictions apply to ownership of 
Canadian and foreign banks. Insurance companies must be licensed in each province where they do 
business, which can complicate mark et access for foreign providers. 
 
Are there some standard requirements that apply eq ually in all provinces for insurance companies that 
request a licence to do business or do the requirements differ by province?  ANSWER:   Paragraph 155 describes how a foreign insu rer may establish in Canada.  In short, a 
foreign insurer may incorporate federally, or may appl y to do business in a particular province.  The 
licensing requirements across provinces are similar.  If a company is incorporated under federal 
insurance legislation, it must govern itself according to federal rules. Similarly, if a company is 
incorporated under provincial insurance legislati on, it must observe provincial governance rules.  
However, for market conduct rules, such as licensi ng, marketing, sales practices, consumer protection, 
the company must follow provincial laws regardl ess of whether it is federally-or provincially-
incorporated.  This is a product of ou r Canada’s federal c onstitutional framework. 
 
[Colombia Question 55] 
 
Question:   Is licensing required only for foreign insura nce companies or also for Canadian ones? 
 
ANSWER:   Foreign and domestic firms follow the same licensing requirements. 
 
[Colombia Question 70] 
 
Question:  Paragraph 129 says that among the most importa nt federal financial laws in Canada are 
the Bank Act, the Trust and Loan Companies Act,  the Insurance Companies Act and the Credit 
Cooperatives Act. Canadian financial legislation is reviewed every five years.  As a result of the 
review in 2001, new financial legislation was adopted .  As a result of the most recent review, a bill 
was presented to Parliament in November 2006.  Why was new financial legislation adopted as a result of the Trade Policy Review in 2001? 
 
ANSWER:   Canada’s financial sector legislation provid es for the review of its laws and regulations 
every five years (Canada may be one of the only ju risdictions in the world that provides for such a 
review).  The amended fi nancial institutions legisl ation and regulations was not undertaken or adopted 
as a result of the Trade Policy Review of Canada. 
 
As a result of the domestic review undertaken in 2001 , Canada amended its fina ncial sector legislation 
and regulations in response to a number of reco mmendations to update the various aspects of the 
federal financial institutions regime, for example,  the ownership regime for financial institutions, 
investment and business powers, consumer pr otection, foreign entry regime for banks. 
  WT/TPR/M/179/Add.1 
 Page 163 
 
 
[Colombia Question 71] 
 
Question on Banking services:   Paragraph 133 says that although banking services are not subject to 
limitations on cross-border provision or foreign co nsumption, suppliers of financial services must 
have a commercial presence to carry on business in Canada. 
 
Can the requirement to have a commercial presen ce in Canada in order to provide cross-border 
financial services be met by having a branch offi ce or what specific legal requirement applies? 
 ANSWER:   To provide banking services in Canada, a foreign bank must establish as either a 
subsidiary or a branch.  With respect to cross- border banking services, generally speaking, as long as 
a foreign bank or its affiliate is not, itself or thro ugh an agent or nominee, carrying on any business in 
Canada (s. 510 of the Bank Act) the federal regul atory framework does not prohibit a foreign entity 
from providing its financial services into Canada.  [Colombia Question 72] 
 
Question: Paragraph 139 says that to establish and operate in Canada, Canadian banks and 
subsidiaries of foreign banks must have a charter a nd permission to start operations.  The Minister of 
Finance issues charters on the recommendation of th e Superintendent of Financial Institutions and 
according to paragraph 140, under the Bank Act, the Minister of Finance can consider all relevant 
factors in deciding to issue bank charters.  The Bank Act contains an illustrative list of such pertinent 
factors, one of which is “the interest  of the Canadian financial system.” 
 What is the charter require ment for banks in Canada? 
 
ANSWER:   There are a number of requirements for operating a bank in Canada, including 
application fees, capital requirements, prudential and supervisory tests for fitness and soundness, etc.  
Please see the website of the Office of the Superinte ndent of Financial Institutions for a complete 
description: http://www.osfi-bsif.gc.ca/.  
[Colombia Question 73] 
 
Question:  Charters are issued by the Department  of Finance on the recommendation of the 
Superintendent of Financial Institu tions.  Can this mean that the recommendation is subject to tests of 
economic necessity or to quantitative restrictions?  
ANSWER:  The factors that the Minister of Finance would consider are set out in the Bank Act and 
these do not include tests of economic necessity or to  quantitative limits.  Please see Section 27 of the 
Bank Act  for a full description of the considerations the Minister of Finance would consider in 
reviewing an application.  These include: the nature and sufficiency of resources, soundness and 
feasibility of the plans of the applicant, business reco rd and experience, character and integrity of the 
applicant, etc. 
 
(7) MARITIME TRANSPORT AND (8) AIR TRANSPORT 
 
[Australia Question 5] 
 
Canada is continuing the process of gradually  reforming its services sector and is an active 
participant in the Doha Round negotiations on services. 
 
Question 5(a):   Could Canada outline its approach to the negotiations on air transport services 
under the General Agreement on Trade in Services (GATS)?  
 WT/TPR/M/179/Add.1 
Page 164  
 
ANSWER:   Canada is of the position that only three ai r-related services are currently covered by the 
GATS.  The Agreement shall apply to measures affecting:   (a) aircraft repair and maintenance services;  (b) the selling and marketing of air transport services; 
 (c) computer reservation system (CRS) services. 
 Question 5(b):  Is Canada prepared to make offers on these services? 
 ANSWER:   Canada has Uruguay Round commitments in  Computer Reservation Services (CRS) and 
Aircraft Repair and Maintenance (ARM) services.  It has not undertaken commitments in selling and 
marketing of air services, as these services are included in some of Canada’s bilateral air agreements.   
 
Question 5(c):   Does Canada see any barriers to extension of the GATS Annex on Air Transport 
Services?  (Please elaborate.)  
 
ANSWER:   As Canada recently stated in the Air A nnex Review in March 200 7, Canada views the 
proposal that Australia tabled on behalf of the Friends of Air Transport as an acceptable basis on which to begin consideration of extending the scope of the GATS to  cover two additional subsectors. 
 Question 5(d):   Could Canada indicate why its MFN exemptions relating to air transport services are 
still considered necessary? 
 ANSWER:   For reasons of safety, Canada maintains b ilateral agreements and arrangements covering 
Aircraft Repair and Maintenance (ARM) services.  In addition, selling and marketing of air transport 
services is included in some of our bilateral air agreements.  As such, Canada requires the MFN 
exemptions. 
 
[New Zealand Question 7] 
 
Question:   We note that Canada’s November 2006 Blue Sky Policy provides a platform for greater 
liberalisation of Canadian air services.  Could Ca nada comment on how it is implementing this policy 
and achievements to date in the pursuit of “further liberalisation of Canada’s air transport agreements” 
(WT/TPR/S/179 para 191)?  ANSWER:   Canada will proactively pursue opportuniti es to negotiate more liberalized agreements 
for international scheduled air transportation th at will provide maximum opportunity for passenger 
and all-cargo services to be added according to market forces. 
 As a primary objective, Canada will seek to nego tiate reciprocal "Open Skies"-type agreements, 
where it is deemed to be in Canada's overall interest.  Recognizing that there may be situations where othe r countries will not be interested in negotiating an 
Open Skies-type arrangement with Canada, a scaled -down exchange of rights will be considered that 
will seek further liberalization.  In this regard, Ca nada expanded its air transport agreement with Japan 
on January 25, 2007.  In addition, Canada held preliminary discussions with the European Commission in February 2007 
regarding the possible negotiation of a comprehens ive air services agreement covering the 27 Member 
States of the European Union.  As dates for negotiations with bilateral partners so lidify, Canada will continue  to be active in seeking 
more open air agreements. 
  WT/TPR/M/179/Add.1 
 Page 165 
 
 
[Brazil Question 7] 
 
Question:   In Chapter IV, there is a reference to th e Regional Aircraft Credit Facility (RACF), which 
is due to expire in March 2008.  Can the Govern ment of Canada comment on plans it might have for 
the future of such program? 
 
ANSWER:   The Government of Canada is not pla nning to extend the Regional Aircraft Credit 
Facility.  
(9) PROFESSIONAL SERVICES 
 
[Australia Question 6] 
 
Question 6(a):   With regard to professional services (i.e. accounting, architecture, engineering and 
legal), Canada maintains a number of citizenship and residency requirements for accreditation at the 
sub-federal level in its GATS schedule of commitments.  Australia is pleased to note that Canada has 
offered to remove some of these requirement s in its Revised Conditional Offer on services. 
 Would Canada explain the policy rationale for the r esidency requirements which are not included it its 
current offers?  Is Canada prepared to review th e scope for further liberalisation in the Doha Round? 
 
ANSWER:   In Canada, professions are self-regulating.  Th is authority is delega ted by provincial and 
territorial governments to regulatory bodies by legi slation, on the basis that their mandate is to 
regulate their members in the public interest.  Resi dency requirements are maintained for the purpose 
of liability/consumer protection (recourse through courts and professional disciplinary purposes), as 
well as to maintain voting rights in membership affairs. 
 
Canada has removed a number of provincial/territorial  citizenship and residency requirements in the 
professional services sectors in line with domestic liber alization that has occurred.  Canada continues 
to consult with its national professional associations  and provincial and territorial governments with 
respect to removing additional residency requirements.   Where Canada is unable to remove remaining 
sub-federal residency requirements,  Canada is looking at binding the temporary licensing regimes for 
some professions in its second revised General Agreem ent on Trade in Services (GATS) offer.  This 
approach would make the process more transparent fo r foreign professionals to be able to temporarily 
provide certain types of professional servi ces in various sub-federal jurisdictions. 
 Question 6(b):   Is Canada considering making co mmitments on legal arbitration and 
conciliation/mediation services?  (See the "Joint Statement on Legal Services" – TN/S/W/37 and 
S/CSC/W/46 of 24 February 2005 – for a definition of 'legal arbitration and conciliation/mediation 
services').  ANSWER:   Canada has already made commitments unde r “Other Business Serv ices: Services related 
to management consulting” which include arbitr ation and conciliation services.  However, where 
arbitration or mediation proceedings address inte rnational law issues and the lawyers are Foreign 
Legal Consultants entitled to practice international law in their home jurisdictions, some scope for 
Canada may exist to make commitments. Canada is  considering taking commitments in this area, in 
consultation with the relevant national professional association. 
 
Question 6(c):   Is Canada considering making commitments  to allow admission to practise domestic 
(Canadian) law subject to domestic regulatory requirements?  ANSWER:   Canada is not considering taking commitments  in the area of domestic (Canadian) law. 
In practice, there are no discriminatory restrictions that prevent foreign lawyers from becoming WT/TPR/M/179/Add.1 
Page 166  
 
members of the provincial law societies, however, there is a process that internationally trained 
lawyers (whether foreign or Canadian) mu st follow in order to become a member. 
 Question 6(d) on Education:   Canada has not made any GATS co mmitments on education services.  
Would Canada be prepared to explore the scope for liberalising this sector in the Doha Round services 
negotiations? 
 ANSWER:   Canada is not prepared to negotiate pub lic education in the Doha Round Services 
negotiations.  [United States Question 14] 
 
Question on Professional Services - Legal Services:   Paragraphs 197 and 198 on page 128 of the 
Secretariat report states that “[f]oreign lawyers may be licensed as foreign legal consultants to provide legal advice only on the law they are permitted to practice in their home jurisdiction.” 
 
Please provide statistics for foreign lawyer consu ltants over the last five years, by province. 
 ANSWER:   Alberta
:  There were no Foreign Legal Consulta nts (FLCs) in 2002, 2003, or 2004.  
There was one FLC in 2005 and three in 2006. Newfoundland and Labrador
:  None over the last five years. 
New Brunswick :  None over the last five years. 
Ontario :  Approximately 70 - 75 per year between 2001 to 2006. 
 Quebec
 and the territories of Yukon, Northwest Territories and Nunavut  do not have FLC regimes. 
 
Note:   Unfortunately, statistics for the other prov inces are not immediately available, however, 
Canada will endeavour to obtain this informati on to be forwarded to Members at a later date 
following the Trade Policy Review.  
[US Question 15] 
 
Question on Professional Services - Accounting Services:  Paragraph 203 on page 129 of the 
Secretariat report discusses Canada’s GATS comm itments with respect to accounting services. 
 Please provide statistics for the presence of foreign account ants over the last five years, by province. 
 
ANSWER:   For the Chartered Accountant (CA) designa tion, at the moment we have statistics 
available for 2006 only, for foreign accountants who passed the examination in order to qualify as 
Canadian Chartered Accountants. 58 forei gn accountants passed the 2006 CA Reciprocity 
Examination (CARE).  This examination is wr itten by members of designated accounting bodies 
outside Canada. Of the 58 successful writers, 38 are from Ontario, 13 from British Columbia, 3 from 
Alberta, and 4 from Quebec.  The professional designations of the successful writers were from the 
United States, England and Wales, Sout h Africa, Ireland, Australia and Japan. 
 For the Certified Management Accountant (C MA) and Certified General Accountant (CGA) 
designations, unfortunately specific statistics are not  immediately available.  However, Canada will 
endeavour to obtain this information to be forwar ded to Members at a later date following the Trade 
Policy Review. 
 
[EC Questions 58] 
 
Question page 128, para. 195:   In the WTO Secretariat's report, it  is mentioned that "in the provinces 
of Ontario and Alberta, members of a law society are required to be permanent residents in Canada."    WT/TPR/M/179/Add.1 
 Page 167 
 
 
Could Canada clarify if this requirement also app lies to the cross-border supply of legal services into 
Canada?  ANSWER:   This requirement does not apply to the cr oss-border supply of legal services into Canada. 
Foreign lawyers are able to provide advisory ser vices on foreign and international law on a cross-
border basis as a qualified Foreign Legal Consultant.  Except for Ontario, there are no requirements 
for citizenship or residency in any other Canadian  province in order to practice as a Foreign Legal 
Consultant. 
 
[EC Question 59] 
 Canada's GATS schedule of specific commitments li sts for Foreign Legal Consultants (CPC 861*) in 
the market access column under mode 4 a requirement  to be "permanent resident for accreditation." 
 Question:   Could Canada explain why this mode 4 re quirement is scheduled in the market access 
column? 
 ANSWER:   Permanent residency in Cana da is equivalent to a nationa lity or citizenship requirement. 
In order to become a permanent resident of Cana da, a person who is not a Canadian citizen must 
apply to immigrate to Canada permanently, which is a process that may involve a few years to achieve.  According to the WTO "Guidelines for the Scheduling of Specific Commitments under the 
General Agreement on Trade in Services (GATS)" adopted by the Council for Trade in Services on 
March 23, 2001 (S/L/92), limitations on the number of  service suppliers shall be scheduled in the 
market access column, which include nationa lity requirements for suppliers of services. 
 
[EC Question 60] 
 
Could Canada also clarify whether or no t this residency requirement is needed: 
 Question 60(a):  to provide legal services as a Foreign Legal Consultant? 
Question 60(b):   only for accreditation? 
Question 60(c):  for obtaining a license to practice as a Foreign Legal Consultant? 
 
ANSWER:   For Ontario, the current provision requires that  a Foreign Legal Consultant must reside in 
the jurisdiction to provide legal services.  Howeve r, the person does not have to reside in the 
jurisdiction to apply to become a Foreign Lega l Consultant.  In Alberta and Newfoundland and 
Labrador, members of the law societies are required to be permanent residents or Canadian citizens, 
however, residency is not a requirement to provide legal services or for obtaining a license to practice 
as a Foreign Legal Consultant.  Canada provides for the right to practice as a Foreign Legal Consultant (FLC) in Saskatchewan and Ontario without meeting normal accre ditation requirements if the FLC ha s practiced the law of his/her 
country for at least three complete years in the case of Saskatchewan and for at least the five preceding 
years in the case of Ontario. 
 
[EC Question 61] 
 
Canada provides for the right to practice as a Fore ign Legal Consultant (FLC) in Saskatchewan and 
Ontario without meeting normal accreditation requireme nts if the FLC has practiced the law of his/her 
country for at least three complete years in th e case of Saskatchewan and for at least the five 
preceding years in the case of Ontario.  WT/TPR/M/179/Add.1 
Page 168  
 
Question:   Could Canada explain what requirements have to be met by Canadian citizens (lawyers or 
non-lawyers) in order to provide advice on fo reign and international law in Ontario and 
Saskatchewan?  ANSWER:   In Ontario, anyone who wishes to give  legal advice about the law of a foreign 
jurisdiction must be licensed as a Foreign Legal Consultant.  The criteria for a license include 
membership in good standing in the law society of the home jurisdiction and each other jurisdiction 
where the applicant is or has been a member.  La wyers who are not also members of the Ontario bar 
must have at least three of the previous five years experience in their home jurisdiction or they will require a supervising lawyer.  Lawyers are also required to have errors and omissions insurance 
equivalent to what is required of members of the On tario bar.  They must undertake not to open a trust 
account or in any way do work that is related to Ontario/Canadian law unless they are members of the 
bar here as well. There is no provision for anyone  who is not a lawyer to provide legal advice in 
Ontario.  An answer on behalf of the law society fo r the jurisdiction of Saskatchewan is not available 
at present, but Canada will endeavour to obtain this information to be forwarded to Members at a later 
date following the Trade Policy Review. 
 
[EC Questions 62] 
 
Question on WTO Secretariat's Report, page 130, para. 205:   Could Canada indicate whether, in 
the negotiation of such MRAs, these representatives of  the professions exercise powers delegated to 
them by central, regional or local governments or authorities within the meaning of article I.3.(a)(ii) 
of the GATS so that the arrangements can be cons idered as mutual recognition agreements concluded 
by the Canada as a member of the WTO?  ANSWER:   With regard to the regulation of professi onal services, authority is delegated to many 
professional bodies by provincial and territorial govern ments.  Provincial and territorial professional 
associations are the only regulatory authorities with the vested powers to sign and negotiate mutual 
recognition agreements. In the case of mutual reco gnition agreements negotiated by such associations, 
Canada’s responsibilities extend to noti fication (as per Article VII (4)). 
 
[EC Question 63] 
 
Question:   If the answer to the preceding question is negative, could Canada indicate whether, once it 
notifies those arrangements under Article VII of th e GATS, Canada, by way of such notification, 
become, as a WTO Member, bound by those arrangements under international law?  
ANSWER:   Under Article VII (4) of the GATS, WTO Members are obliged to notify the Council for 
Trade in Services of recognition measures and st ate whether such measures are based on mutual 
recognition agreements or arrangements.  This notifi cation is intended for the purpose of transparency 
in order to provide adequate opportunity to any othe r Member with an interest in participating in 
negotiations or to negotiate their accession to a c oncluded agreement. Canada ’s responsibilities extend 
to notification (as per Article VII (4)). 
 
[EC Question 64] 
 
Question:   If the answer to the two preceding questions is negative, taking into account that Canada is 
able, as a WTO Member, to undertake commitments in respect of professional and business services 
and in developing disciplines on domestic regulation under article VI paragra ph 4 of the GATS, could 
Canada indicate which are the reasons that prevent them from negotiating, as a WTO Member, MRAs in respect of professional and business services under article VII of the GATS?  ANSWER:   Canada has undertaken commitments for prof essional and business services on behalf of 
provincial and territorial governments, including professional regulatory bodies with the delegated  WT/TPR/M/179/Add.1 
 Page 169 
 
 
powers.  As noted above, under Article VII (4), Members are obliged to inform the Council for Trade 
in Services of such mutual recognition agreemen ts or arrangements.  However, provincial and 
territorial professional associations are the only regu latory authorities with the vested powers to sign 
and negotiate mutual recognition agreements in Cana da.  The Government of Canada has no authority 
to regulate professional services and can only enc ourage and support provincial and territorial 
professionals associations to negotia te mutual recognition agreements. 
 
[EC Question 65] 
 
Question on Postal/courier services:   Several foreign companies have  been operating in Canada in 
the area of outbound international mail for at l east 20 years. About 2 years ago Canada Post 
Corporation (CPC), the national post operator, star ted claiming that this activity fell within its 
reserved competence and initiated different actions in  order to implement its privilege.  These actions 
were directed at foreign companies, starting with the smallest ones that were brought to Courts in 
2005 and the courts finally issued an injunction (March 2006) to terminate the activity of outbound 
international mail by November 2006.  Despite the fact that CPC action appears to be based on an 
unfair behaviour, since CPC has not been invoking its privilege for 20 years, Canada Post's actions 
towards reintroducing a monopoly at a time postal services around the world are opening to competition are sending a very negative signal with  regards to Canada's business environment. 
 
What steps and timeframe do the Canadian au thorities envisage to address this situation? 
 
ANSWER:   Canada has offered full commitments for courier services under the GATS, consistent 
with Canada’s highly competitive courier market .  Indeed, the Canadian domestic regulatory 
environment for the operation of commercial courie r companies is among the most liberal regulatory 
environments of the WTO membership. 
 
Canada has taken no commitments under the GATS with respect to postal services, including 
outbound international mail.  This is  consistent with the objectives of  the Universal Postal Convention 
towards implementation of permanent, qualit y postal services at affordable prices. 
 The action taken by Canada Post Corporation before  domestic courts, as discussed in this question, is 
fully consistent with Canada’s WTO rights and obligations.  Canada ’s regulatory environment in the 
area of courier and postal services, including all appli cable statutes and regulations, is transparent and 
predictable.  This regulatory environment is a ke y contributor to the favourable investment climate 
that exists in Canada.  [Chile Question 6] 
 
Question on Page 163 (page 129 in English version of report) Paragraph 199:   The report 
indicates that under the NAFTA, an agreement was si gned so that lawyers from any country could act 
as foreign consultants in third countries of the NAFTA .  Even so, the agreement is not applied at the 
present.  What are the reasons for that? 
 
ANSWER:   In June 1998, representatives of the legal professions of Canada, the U.S. and Mexico 
signed an Accord on the procedures for the licensing of  foreign legal consultants, including the form 
of association or partnership between lawyers and legal consultants.  From the Government of 
Canada’s understanding, the Accord has not yet been implemented due to outstanding issues with 
regard to the ratification of the agreement. 
 
[Colombia Question 57] 
 
Question:   Paragraph 9 says that practically all professions  are regulated at the provincial or territorial 
level and that measures to facilitate movement of  professionals between the provinces and territories WT/TPR/M/179/Add.1 
Page 170  
 
have been strengthened.  However, in some cases,  while citizenship and residency requirements still 
apply, some barriers have been removed.  Could Canada give examples of citizenship and r esidency requirements for practising a profession in 
that country which have been removed?  What barriers remain? 
 
ANSWER:   Through its initial and revised GATS o ffers, Canada has removed a number of 
provincial/territorial citizenship and residency requ irements in the professional services sectors in line 
with domestic liberalization that has occurred.  [List below]  
 
Canada maintains sub-federal residency and perm anent residency requirements in a number of 
professions, including foreign legal consultancy services;  accounting, auditing and bookkeeping 
services; architectural services; engineering and inte grated engineering services; and urban planning 
and landscape architectural services.  The specific  requirements vary by profession, as noted in 
Canada’s GATS Schedule of Commitments. 
 
List of sub-federal limitations that have been removed from Canada’s GATS Schedule in initial 
and revised offers: 
 
Foreign Legal Consultants (advisory services on foreign and public international law) 
 - Removal of permanent residency requ irement for accreditation (Prince Edward 
  Island) 
 - Removal of citizenship requirement (Quebec)  
Accounting, auditing and bookkeeping services 
 - Auditing
:  removal of requirement for a commercial presence (Nova Scotia) 
 - Auditing :  removal of citizenship requirement  for accreditation (Manitoba, Quebec) 
 - Auditing :  removal of residency requirement for accreditation (Ontario, Prince  
  Edward Island)  - Licensed Public Accountants
:  removal of residency requirement for accreditation 
  (Manitoba)   Architectural services 
 - Architects
: removal of citizenship requirement for accreditation (Quebec) 
 - Architects : removal of residency requirement for accreditation (New Brunswick) 
 
Engineering and integrated engineering services 
 - Consulting Engineers : removal of requirement for commercial presence for  
  accreditation (Manitoba)  - Engineers
: removal of permanent residency requirement for accreditation  
  (Newfoundland and La brador, Nova Scotia) 
 - Engineers : removal of citizenship requirement for accreditation (Quebec) 
 Urban planning and landsca pe architectural services 
 - Community/Urban Planning
: removal of citizenship requirement for use of title 
  (Quebec)  WT/TPR/M/179/Add.1 
 Page 171 
 
 
REPORT BY CANADA (WT/TPR/G/179) 
 
I. TRADE AND ECONOMIC POLICY ENVIRONMENT 
 
Investment 
 
[Honduras Question 1] 
 
In paragraph 11, (page 2 Spanish version, page 6 English version), the Canadian government report 
says:  [ translation ] “At the same time, direct foreign investment totalled $41 billion in 2005, 
compared with $2 billion the year before.  This sp ectacular increase is due mainly to more direct 
foreign investment in the energy and metals sectors in Canada.”  Question 1(a):   Can Canada give more detail on di rect foreign investment in Canada? 
 
ANSWER:   In 2005, the stock of foreign direct inv estment (FDI) in Canada  posted the strongest 
growth since 2001, rising sharply by 9.1%.  The FDI increase in 2005 came mostly from acquisitions 
and injections of funds from parent in the working capital of their Canadian affiliates. 
 In 2005, spearheaded by buoyant energy prices, FDI in the energy sector grew the fastest (22.3%), 
followed by service and retailing (18.2%), meta llic minerals and meta l products (16.7%), 
communication (15%), chemicals & textiles (12.5% ) and machinery and equipment (11.5%).  FDI 
grew below par in electrical and electronics (4%) and finance and insurance (3.9%), while declining 
in wood and paper (-3.9%) and transportation equipment (-6.1%).  In 2005, finance and insurance accounted for the la rgest share of FDI (21.4%), followed closely by 
the energy sector (19.7%). In fact, both sectors expe rienced a marked increase in  their shares of total 
FDI in the last decade, rising by 4.1 and 8.8 percen tage points, respectively, since 1995.  These gains 
came at the expense of a decline in the shares of most other industries, most notably food and 
beverages (3.2 percentage points), wood and pa per (2.7 percentage points), machinery and 
transportation equipment (2.7 percentage points), c onstruction (2.2 percentage points) and chemicals 
and textiles (2 percentage points).  Over the last  10 years, communications electrical and electronic 
products, and the services sector mainta ined their share of FDI with their growth rates being in line 
with overall growth of FDI.  Question 1(b):   From what country (or countries) does the direct foreign investment come? 
 
ANSWER:   The U.S. remains the most dominant foreign di rect investor with 64.1% of Canada’s total 
FDI stock in 2005 - much the same as in 1995 – followed by four European countries:  The United Kingdom (7.2%), France (6.8%), the Netherla nds (5.2%) and Switzerland (3.1%). In 2005, the 
top 10 major investor countries accounted for 95% of the total FDI stock in Canada.  Brazil was the 
only new and developing country to make the top 10  list of major source countries of FDI in Canada 
in 2005. 
 
II. TRADE POLICY DEVELOPMENTS 2003-2006 
 
(1) MULTILATERAL LIBERALIZATION 
 
Commitment to the Doha Development Agenda 
 
[Brazil Question 1] 
 
Question:   In Chapter II, paragraph 15, the Canadian  Government states that "Canada seeks (...) 
substantial improvements in market access for ag ricultural and food products".  How does the WT/TPR/M/179/Add.1 
Page 172  
 
continued support for the system of supply management (as shown in Ministers Chuck Strahl and David Emerson's appearance before the Standing Committee on Agriculture and Agri-Food of the 
House of Commons on February 27th, 2006) rela te to that goal at the Doha negotiation? 
 ANSWER:   Canada recognizes that the Doha Round pr esents an important opp ortunity to enhance 
the prosperity of our agriculture sector through increased trade liberalization.  Like all WTO 
Members, Canada’s negotiating pos ition is informed by a range of interests reflective of our 
agriculture and agri-food sector, which includes both supply managed sector s and export-oriented 
industries.  We are continuing to seek the best possible outcome from these negotiations for our entire 
agriculture sector.  
 
(2) SUPPORTING DEVELOPMENT 
 S&DT, TRTA, LDC Accessions, EIF, ODA 
 
[EC Question 3]  
Question 3a) and 3b) on Canada's Report, page 9, para. 33:   It is stated that "The Canada-Caricom 
Trade and Labour Project (CCTLP) was established in 2005.  Under this project, a million, three-year 
activity plan was developed for English and Dutch- speaking Caribbean countries to better address the 
labour dimension of international trad e and regional economic integration". 
 
Could Canada provide more de tails regarding this project? 
 ANSWER:   This project will enable the Labour Br anch of Canada’s Department of Human 
Resources and Social Development (HRSDC) to suppor t efforts that address the labour dimensions of 
globalization in the Caribbean and will help to e nhance the capacity of CARICOM countries to meet 
their obligations under the terms of labour provisions  that would be negotiated in the context of any 
future Canada-CARICOM Free Trade Agreement.  The project is iterative in nature.  Three sub-
projects have been identified for the first year of the project, including:  (i) consultations and dialogue 
among concerned stakeholders rega rding the inter-relationship between  trade and labour, as well as 
the preparation of a CARICOM position paper on a regi onal approach to trade and labour in external 
negotiations;  (ii) a series of educational activities in  the Caribbean to enhance public awareness of the 
treatment of labour issues in the context of trad e arrangements and to build the capacity of civil 
society to understand the interrela tionship between trade and labour issues;  and (iii) to enable the 
Organization of Eastern Caribbean States (OECS) to  expand and integrate an in-depth occupational 
health and safety component into its work to e nhance export-sector productivity and competitiveness 
of OECS firms in the context of ec onomic integration.  The set of activities identified for the first year 
does not address the short term challenges of labour ma rket adjustment to international trade opening.  
It is possible that this issue could be addressed in s ubsequent workplans if the local partners identify it 
as important.  
(4) REGIONAL AND BILATERAL INITIATIVES 
 
(a) Security and Prosperity Partnership  [EC Question 11] 
 Question:  Could Canada elaborate on the progress ma de with its partners on the Security and 
Prosperity Partnership for North America (SPP) initiative? 
 
ANSWER:  Canada, Mexico and the United States launched the Security and Prosperity Partnership 
of North America (SPP) to increase security and pr osperity, and improve the quality of life for the 
citizens of North America.  At their summit in March 2006, Leaders reaffirmed their commitment to  WT/TPR/M/179/Add.1 
 Page 173 
 
 
the SPP and identified five priorities: 1) St rengthening Competitiveness by enhancing regulatory 
cooperation and creating a private sector-led North American Competitiveness Council (NACC); 2) Emergency Management Coordina tion; 3) Cooperation on Avian and Human Pandemic Influenza 
Planning; 4) Energy Security; and 5) Ensuring Smart, Secure Borders.  
On 23 February 2007 Ministers responsible for the SPP met in Ottawa to re view progress in advance 
of the next Leaders' Summit, scheduled to be held  in August 2007.  Specifically, they tasked working 
groups and coordinators with revita lizing and streamlining their work plans to ensure that initiatives 
are more focussed and results-oriented. In this cont ext, ministers instructed that work on a trilateral 
framework for regulatory cooperation be finalized by August 2007 Leaders' Summit.  They also 
requested that the Coordinating Body created to prepare a North American Plan for cooperating on 
Avian and Pandemic Influenza be finalized by June  2007.  Additionally, Ministers established a 
senior level coordinating body to prioritize and oversee emergency management activities in the 
following areas: 1) emergency response; 2) critical infrastructure protection; 3) border resumption in 
the event of an emergency; and 4) border incident management. 
 
The NACC has since presented and made public its report and recommendations in the areas of 
border crossing facilitation, standards and regulat ory cooperation, and energy integration.  
Governments will be responding in due course.  Further detailed information and reporting is available through th e Internet at:  http://www.spp-
psp.gc.ca/menu-en.aspx. 
 
[EC Question 12] 
 
Question:   In addition to border measures, what  other SPP initiatives will affect Canada's 
international trade and in what way? 
 ANSWER:   The Security and Prosperity Partnership of  North America has a broad, far-reaching 
agenda based on concrete, forward-looking strate gies and initiatives.  It seeks to expand economic 
opportunities by making businesses more competitive in  the global market place through increased 
collaboration among the three countries with a view to  improving the security, the prosperity and the 
quality of life of all North Americans.  It also facilitates trade and security by promoting greater 
cooperation in certain sectors and by identifying m easures to facilitate commerce.  The SPP builds on 
existing cooperation between the three countries and set  out in trilateral agreements and the ties that 
have shaped the North American partnership for d ecades.  Further information on initiatives currently 
underway can be found on the website dedicated to the SPP at the following address:  http://www.spp-
psp.gc.ca/menu-en.aspx. 
 
(b) Bilateral Trade Initiatives 
 
[Brazil Question 2] 
 Question 2 (a) on paragraphs 65-72:   Under the heading "Bilateral Trade Initiatives" (Chapter II, 
paragraphs 65 to 72), the Canadian  government outlines its priorities and intentions regarding trade 
negotiations with some countries/groups of countries, in cluding in Latin America.  On this issue, the 
Brazilian Government would like to pose two questions:  
No bilateral agreements have been signed by Canada  since 2003.  Is it the result of a policy decision 
or something due to circumstan ces beyond Canada's control? 
 ANSWER:   Every negotiation presents its own opport unities, issues, and challenges and as such, 
different approaches are required.  Canada is hopeful that its efforts to bridge remaining differences in WT/TPR/M/179/Add.1 
Page 174  
 
ongoing negotiations will lead to their successful conclusion soon and in a manner that has clear 
benefits for Canada.  Question 2 (b):   In the pages mentioned above, no refere nce is made to Mercosur.  Is there any 
specific trade policy objective for such gr oup of countries?  If so, please elaborate. 
 
ANSWER:   Canada and Brazil share similar views and goals at the multilateral level, with both 
countries committed to more liberalized trade an d a rules-based multilateral system.  This is 
demonstrated by our commitment to an ambitious  outcome in the WTO Doha Development Agenda 
talks and our collaboration in the Cairns Group of agricultural exporting countries. 
 
The Mercosur countries are important markets for Canada, and we are comm itted to enhancing our 
trade and investment relationships.  Canada h as a Foreign Investment Promotion and Protection 
Agreement with Argentina and Uruguay,  and Canadian investors have e xpressed an interest in Canada 
negotiating a similar agreement with Brazil as a means to foster the two-way investment relationship.  
In addition, Brazil was chosen as a partner count ry in the International Science and Technology 
Partnerships Program, aimed at fo stering international science and technology (S&T) partnerships and 
collaborative research, with an emphasis on industr y-industry partnerships and university-industry 
partnerships.  (c) Other Bilateral Initiatives – Foreign Investment Protection Agreements (FIPAs) 
 [Brazil: Question 3]  
Question:   In Chapter II, paragraphs 76 and 77, the Ca nadian government lists countries with which it 
maintains or presently negotiates Foreign Investment  Protection Agreements (FIPAs).  Could Canada 
elaborate on the effectiveness of such agreemen ts in generating new FDI to and from Canada? 
 ANSWER:   Given Canada's open, transparent invest ment regime it is unlikely that Foreign 
Investment Protection Agreements (FIPAs) gene rate a significant amount of Foreign Direct 
Investment (FDI) into Canada.  However, these agre ements provide the stability and predictability in 
the investment regimes of partner countries that Canadians investing abroad value.  Though it is 
difficult to measure a direct causal link between th e existence of a FIPA and growth in FDI from 
Canada, our investors have communicated to us that  the rigorous disciplines that FIPAs include, such 
as non-discrimination, expropriation, transfer of funds, and investor-state  dispute settlement, are 
factors that are taken into account in their investment decision-making process.  
(7) TRADE POLICY AND TRADE PROMOTION 
 [Japan Question 1] 
 
Question on paragraph 92, page 19 (Closure of Canadian Consulates):   The report by Canada 
mentions Canadian trade offices in Canadian Em bassies and Consulates, regarding the decision over 
the closure of the four Canadian Consulates (incl uding two Consulates in Japan: Osaka and Fukuoka).  
 
How were these Consulates selected?  What were the principles for the selection? 
 ANSWER:   The decision to close consulates stems from a Government of Canada mandated 
expenditures cut.  For its contribution, the Departme nt of Foreign Affairs and International Trade was 
required to find $70 million in savings over two year s.  The closure of posts was one element of a 
larger strategy to meet the required target. 
 
To determine which posts to close, three principles were applied:   WT/TPR/M/179/Add.1 
 Page 175 
 
 
-Closures should be done by consolidation to guara ntee a continued point of service.  This meant 
closures were likely to affect Consulates or Consul ates General in countries with large embassies that 
have the capacity to sustain a wide array of programs and services.  -Closures were to take place in countries w ith strong communications and transportation 
infrastructure to ensure a minimal di sruption of services across the country. 
 -Closures would take place in countries where st rong contacts exist through associations and other 
organizations.  Such groups woul d be leveraged to assist with the building and maintenance of 
enduring relationships. 
 
(8) OTHER INITIATIVES (I) INTER-PROVINCIAL TRADE INITIATIVES 
 [Japan Question 2] 
 Question on paragraph 116, page 22:   According to the Canada's re port, the federal and provincial 
governments of Canada established the Agreement on Internal Trade (AIT) which aims to reduce and 
eliminate barriers to the free trade within Canada, and agreed 11 sectors to focus on. 
 (a) Please provide information on the recent progress of the regulatory reform in the trade of alcoholic 
beverages, which is one of the 11 focused sectors. 
 
ANSWER:   The federal government delegated the r esponsibility for the importation and sale of 
alcohol beverages to the provinces in 1928.  This  included responsibility not only for imports from 
another country but also products from another provi ncial jurisdiction.  Since that time provinces and 
the territories have assumed complete control over th e importation, storage, distribution and sale of all 
beverage products containing alcohol.  In provincial  and territorial jurisdictions, government-operated 
liquor boards generally serve to ta ke first receipt of out of provi nce and imported products, arrange 
physical delivery of these products to and from thei r warehouses (except Alberta where it is a paper-
based receipt) and levy any applicable fe deral and provincial duties and taxes. 
 Since the provinces and the territories have exclus ive rights to produce legislation on alcohol 
beverages, any changes to such laws require provi ncial consent.  As a result, Chapter 10 of the 
Agreement on Internal Trade (AIT) dealing with beverages containing alcohol was the result of 
negotiations between the federal a nd provincial governments.  The objective of this chapter was to 
reduce trade barriers between provincial jurisdictions on alcohol beverages.  
In the years following the signing of the AIT, so me reductions in inter-provincial trade barriers 
permitting freer movement of alcohol beverages oc curred.  These reductions took place primarily in 
western Canada and have been beneficial to the br ewery industry.  In recent years brewers have been 
able to rationalize their domestic production in fewer but larger plants capable of serving more than 
one province.  
Question 2(b):   Please explain Canadian view which ba rriers the federal and provincial governments 
of Canada consider to be reduced and eliminat ed for the free trade of alcoholic beverages. 
 ANSWER:   A few provinces have made changes to re tailing practices.  For example, by the mid-
1990s, Alberta had placed retailing in the hands of th e private sector.  This has resulted in alcohol 
beverages becoming available to consumers at mo re points of sale. BC, Quebec and Ontario have 
studied full-scale privatization similar to Alberta but have not elected to adopt  that approach.  While 
BC has not moved to full privatization, there has be en a dramatic increase in the number of privately 
owned liquor retail stores which compete directly with the government-owned ones.  WT/TPR/M/179/Add.1 
Page 176  
 
[EC Question 13] 
 
Question on page 23, para. 117:   How does the [Trade, Investment, and Labour Mobility 
Agreement] TILMA, signed between British Columbia and Alberta, fit within the structure of the 
Agreement on Internal Trade, in particular with th e possibility of different decisions arising out of 
each Agreement's dispute settlement process? 
 ANSWER:   The Agreement on Internal Trade (AIT) establishes national rules governing internal 
trade in 11 sectors or policy fields (e.g. procurement,  agriculture).  However, it also permits signatory 
Parties to enter into other “trade enhancement arrangements” as long as the arrangement liberalizes 
trade beyond the level required by the AIT and othe r AIT parties may be allowed to join.  The Trade, 
Investment and Labour Mobility Agreem ent (TILMA) is such an arrangement. 
 The AIT and TILMA are complementary agreements.  The former applies to trade within Canada 
including trade between either TILMA signatory an d other AIT Parties.  British Columbia- Alberta 
trade, however, is now effectively governed by TILMA rules since these are generally overall more 
liberal.  With regard to dispute settlement, panels will addr ess the issues raised by the agreement in the case 
that is before them.  The potential for inconsiste nt decisions could only arise where a Party to TILMA 
(or one of its persons) chooses to launch a complaint against the other Party under the AIT as well as 
TILMA.  This scenario is precluded, however , since duplicate complaint processes and forum-
shopping are barred under the latter.  In addition, in  the event any inconsistency is identified between 
the two agreements, TILMA stipulates that the provi sion more conducive to liberalization will prevail. 
 
IV. PROMOTING POLICY COHERENCE 
 
Trade, employment and labour  
[EC Question 4]  
Question on page 25, para. 133:   Para 133 of Canada's Report on trade and employment policies 
states:  "Canada will continue to work with other WTO Members and through other 
intergovernmental organizations to promote intern ational coherence of policies and institutions". 
 
What specific actions does Canada undertake to  ensure sound policy coherence on trade and 
employment issues, including through bilateral ag reements, multilateral policy and the ILO's decent 
work agenda (para 142)?  ANSWER:   As responsibility for labour matters is a shared jurisdiction be tween the federal, 
provincial and territorial governments, the federa l government fosters cooperation and coordination 
among labour jurisdictions on international and national workplace issues. 
 
Further to this, the Government of Canada’s policy with respect to trade and labour is to negotiate 
labour provisions in the context of trade agreements.  These provisions call for the observance of 
national labour laws, and for those laws to reflect core labour standards.  These negotiations are led by 
Human Resources and Development Canada (HRSDC),  in consultation with the Department of 
Foreign Affairs and International Trade (DFAIT), in order to ensure coheren ce.  Canada’s experience 
with the North American Agreement on Labour  Cooperation (NAALC) and the Canada-Chile 
Agreement on Labour Cooperation (CCALC) con tinues to be positive in this regard. 
 
Another example of specific action in this area is our program of long-term capacity building and 
governance strengthening with countries with which Ca nada has, or is negotia ting, labour agreements,  WT/TPR/M/179/Add.1 
 Page 177 
 
 
as well as with those with which it has partnered in  the context of the Inter-American Conference of 
Ministers of Labour. 
 
Multilaterally, Canada recognizes the leadership ro le of the ILO.  Canada also recognizes the 
important contribution of the private sector to  these objectives, and supports ways to advance 
discussions on the achievement of these objectives in other relevant multilateral fora, including the 
UN Global Compact;  the Business and Industry Advisory Committee (BIAC) and Trade Union 
Advisory Committee (TUAC) roles with respect  to the OECD Guidelines, and via the ILO 
Committees for Multinational Enterprises (MNEs).  
The federal government works with  provincial and territorial governments on ILO issues and in the 
respect and promotion of core labour standards a nd the ILO’s Declaration on Fundamental Principles 
and Rights at Work.  The federal government also actively participates in the work of the ILO, 
including its Governing Body, through its program s and initiatives such as the Decent Work Agenda 
and through contributions to the work of the World Commission on the Social Dimensions of 
Globalization. 
 
[EC Question 5] 
 
Question 5:   How does this approach relate to th e WTO-ILO study on trade and employment 
published in February 2007? 
 
ANSWER:   Our actions are consistent with the findi ngs of the WTO-ILO study in that they reflect 
the crosswalks between trade, labour and social policies, and recognize that effectively addressing 
concerns in each of these areas requires an integrated  approach by all levels of government and with 
non-government partners. 
 
[EC Question 6] 
 
Question on page 27, para. 140:   Para 140 of Canada's report cove rs labour principles and rights in 
bilateral agreements.  
 
What mechanisms does Canada use to promote b asic labour/human rights while ensuring that such 
provisions are not used by any party for protectionist means?  ANSWER:   Where relevant, Canada uses its bilateral trade agreements to promote observance of 
labour-related human rights obligatio ns through labour provisions ne gotiated in the context of those 
trade agreements. The ILO international labour standards are reflected in these. 
 Under these agreements participating countries co mmit to:  a) promoting certain key labour 
principles, including the ILO’s fundamental principles and rights at work;  b) effectively enforce their 
own labour legislation and;  c)  cooperate on labour matters. 
 
In addition, these labour provisions include a mech anism through which the public can raise concerns 
that could ultimately be brought to the attention of  an independent review panel as a means of dispute 
resolution.  These agreements emphasize the need for cooperati on and capacity building and do not attempt to 
harmonize labour legislations and standards between FTA partners, thus ensuring that they are not 
used for protectionist means.  Therefore, they leav e States free to adopt a system of labour laws that 
reflect domestic traditions, values and realities, including in regard to establishing minimum wages, consistent with international ob ligations.  Through cooperation, th ey also provide opportunities for 
Canada to work with its partners  to improve working conditions and living standards, and to protect 
and enhance basic workers’ rights. WT/TPR/M/179/Add.1 
Page 178  
 
Cooperative activities held under our agreements ha ve included seminars, government-to-government 
workshops and public confer ences on labour-related matters. 
 
OTHER QUESTIONS 
 
[Norway Question 1] 
 
Question:   We have taken note that Canada's framework  for trade and investment policy is based on 
shared federal-provincial competencies.  What kind of jurisdiction do the provinces have with regard 
to the implementation and application of provinci al measures/restrictions regarding international 
trade? 
 ANSWER:  Under the Constitution Act, 1867, the Parliame nt of Canada has legislative jurisdiction 
over, among other things, "The Regulation of Tr ade and Commerce", which includes international 
trade.  The provincial legislatures have legislativ e jurisdiction over, among other things, "Property and 
Civil Rights in the Province" and "Generally all Matte rs of a merely local or private Nature in the 
Province".  It is the role of the courts to determ ine where federal legislative powers end and provincial 
powers begin, through litigation in specific cases.  
[EC Question 1] 
 Question:   Does the issue of trade and sustainable deve lopment fit into Canada's overall trade policy 
strategies?  ANSWER:   Sustainable development (SD) is a corner stone of Canadian foreign policy.  Canada 
employs trade policy as a strategic tool to help build  a world that is more secure, more prosperous, 
and more sustainable.  We apply a coherent and principled approach  to trade policy development and 
implementation, fostering the integration of econo mic, social and environmental considerations. 
Federal departments and agencies work together with  provincial and territorial governments, as well 
as Canadian society to ensure that our values, inte rests and aspirations are appropriately taken into 
account when developing and implementing trade policy.  
Federal government departments in Canada are also required by law to table Sustainable Development 
Strategies in Parliament every three years.  Th ese Strategies are designed to integrate sustainable 
development criteria into policies, programmes a nd operations.  Through a series of innovative and 
measurable initiatives, the Department of Foreign Affairs and International Trade actively supports 
sustainable development in the achievement of Cana da’s international trade and commerce priorities. 
This includes promotion of trade in environmenta l goods and services by:  providing information, 
export readiness and promotion services to business;   securing market access and establishing 
regulations within multilateral, re gional and bilateral trade negotiati ons; and facilitating international 
investment, and science and technology partnershi ps which increase the potential for innovation in 
this sector.  These activities are all essential to  enhancing Canadian competitiveness in the 
environmental goods and services sector, including but not limited to technologies for GHG emission 
reduction, clean air and renewable energy. 
 In addition to these activities, all bilateral, re gional and multilateral commerce negotiations must 
undergo environmental assessments regardless of the trade policy instrument employed, for example, 
free trade agreements (FTAs) or investment pr omotion and protection agreements (FIPAs) (see 
response to next question for additional inform ation on our process to conduct environmental 
assessments of trade negotiations).   WT/TPR/M/179/Add.1 
 Page 179 
 
 
[EC Question 2] 
 
Question:   What mechanisms does Canada have in place to ensure adequate coordination of 
environmental policy and trade policy?  
ANSWER:   The Government of Canada is committe d to conducting environmental assessments 
(EAs) of trade negotiations using a process that re quires interdepartmental coordination and external 
consultations.  The 2001 Framework for the Environmental Assessment of Trade Negotiations  details 
this process.  It was developed in consultation w ith the provinces and territories, aboriginal groups, 
and representatives from academia, non-government al organizations, and the private sector. 
 
The Framework is applied to bila teral, regional, and multilateral negotiations.  The Framework has 
two key objectives.  –First, it provides a means to integrate environmental concerns into the negotiating process.  The 
analytical methodology requires the identification of the economic effects of the negotiation and the 
likely related environmental impacts.  Environmenta l impacts are then assessed  for their significance. 
The Framework recognizes that economic and environmen tal effects can relate to changes in the level 
and pattern of economic activity, the type of pr oducts traded, technology changes, as well as 
regulatory and policy implications.  There are th ree increasingly detailed phases of assessment that 
correspond to progress within the negotiati ons: the Initial, Draft, and Final EA. 
 
–Second, it addresses public concerns by documenti ng how the environment is considered during 
negotiations.  There is a strong commitment to communications and consu ltations throughout each 
EA of trade negotiations.  Results from the analysis  are enhanced through consultations that include 
engagement with the provinces and territories, experts, and the public.  Public reports are issued at the 
end of each phase of assessment. 
 The Department of Foreign Affair s and International Trade works w ith other government departments 
to apply the Framework to current negotiations.  The Handbook for the Environmental Assessment of 
Trade Negotiations  contains guidance on how to apply the Framework, and is updated based on 
improved understanding regarding EA of trade. 
 
Information on Canada’s process for conducting envir onmental assessments of trade can be found at 
the following web site: www.internatio nal.gc.ca/tna-nac/env/env-ea-en.asp. 
 WT/TPR/M/179/Add.1 
Page 180  
 
REPLIES PROVIDED BY CANADA TO ADVANCE 
WRITTEN QUESTIONS RECEIVED AFTER MARCH 7, 2007 
 
REPORT BY THE SECRETARIAT (WT/TPR/S/179) 
 
I. ECONOMIC ENVIRONMENT  (2) RECENT ECONOMIC DEVELOPMENTS (iii) Fiscal Policy  [Korea Question 1] 
 Question on pp. 5-6, para. 15-19:  Canada has posted fiscal surpluses as a result of tax reform and 
the reduction of inefficient government expenditure since the early 1990s.  This prudent fiscal policy 
is a good example for other countries.  
 
However, it is known that since the year 2006, th e Canadian government has taken measures to 
reduce taxes such as GTS (Goods & Service Tax), fe deral corporation tax, personal income tax and 
has offered various tax credits.  
 
Does Canada expect to achieve its goals, such as an annual fiscal surplus of between Can$2 billion 
and Can$4.2 billion in the following five years, an  annual federal debt re duction of Can$3 billion 
during the same period, and the elimination of the go vernment's net debt by the year 2021, under such 
a wholesale tax reduction policy?  
 
ANSWER:   The Government is committed posting annual surpluses of at least $3 billion, which will 
be used to pay down the federal debt.  The Gove rnment remains on track to meet its commitment to 
lower the federal debt-to-GDP ratio to 25 per cent by 2012-13. 
 
The projected budgetary surpluses and debt reduction in Budget 2007 are after  accounting for all of 
the Government’s tax reduction commitments since Budget 2006. 
 
This reflects Canada’s strong ec onomic and fiscal situation, and the Government’s commitment to 
accountability in budgetary planning and management of taxpayer’s money. 
 
To make certain that planned debt reduction translat es into tax relief, the Government will legislate 
the Tax Back Guarantee.  This measure ensures th at the interest savings from debt reduction are 
directed to personal income tax reductions.  Tax relief from the Tax Back Guarantee already amounts 
to $2.4 billion over the next two years, or one-quart er of the total tax relief in Budget 2007.  As 
outlined in Advantage Canada , the Government also proposes that Canada should aim to eliminate 
total government net debt by 2021.  Net debt captur es the full impact of public debt on the economy, 
as it includes debt of provincial-territorial and local governments, and the assets of the Canada 
Pension Plan and the Quebec Pension Plan.  It is th e standard measure of debt used by organizations 
such as the OECD. With the fiscal plan set out in  Budget 2007 and with a c ontinued solid provincial 
outlook, Canada remains on track to meet this objective. 
 
(4) TRADE AND INVESTMENT (i) Merchandise Trade 
 [Korea Question 2] 
 
Question:   The Canadian current account of the balance of payments has been in surplus since 2002. 
Canada has achieved positive economic outcomes with  its twin surpluses, the fiscal surplus and the 
surplus in the current account balance, becoming th e only OECD country to achieve twin surpluses. 
  WT/TPR/M/179/Add.1 
 Page 181 
 
 
However, it appears this economic accomplishment is mostly attributable to the changing 
environment of international trade, including soaring energy prices and booming oil and gas 
production.  In contrast, exports in manufacturing ha ve declined and productivity growth is relatively 
slow.  
 
In order to insulate itself from a fall in prices of energy and mineral resources in the international 
market, Canada would be required to enhance the competitiveness of its manufacturing and to 
diversify its export market.  What ar e Canada’s plans in this regard? 
 
ANSWER:   Canada has maintained a current accoun t surplus since 1999 through a combination of 
solid surpluses in goods and services trade and a st eadily diminishing investment income deficit.  
However, as pointed out, the environment for inte rnational trade is changing.  The Government of 
Canada recognizes this and has developed a plan th at focuses on developing or enhancing Canadian 
competitive advantages to help the country succeed both domestically and on the world stage.  The 
plan, called Advantage Canada , has a five-pronged thrust.  First, Canada will reduce taxes for all 
Canadians and establish the lowest tax rate on new business investment in the G7.  Canada will also 
continue to be responsible in its spending, effec tive in its results, and accountable to taxpayers  
Canada will thus eliminate its tota l government net debt in less than  a generation.  Third, Canada 
intends to create the right competitive conditions fo r firms to invest and flourish.  Along with lower 
taxes, this will be accomplished through reductions  in unnecessary regulation an d red tape to unlock 
business investment.  By building a more compe titive business environment, Canadian businesses will 
be better equipped for global success.  Fourth, th e approach will also address labour market policies 
and emphasize enhanced education and skills de velopment.  Measures such as increasing the 
participation of Canadian and im migrants in the workforce, skills development and training and 
facilitating workforce mobility are the focus of th ese labour-oriented initiatives.  Finally, Canada will 
invest in its infrastructure to create modern, wo rld-class facilities to ensure the seamless flow of 
people, goods and services across Canadian roads a nd bridges, through Canadi an ports and gateways, 
and via Canadian public transport.  Combined, these measures should stimulate investment — both domestic and from abroad — in Canada, raise productivity, lower business costs, a nd foster a more competitive Canadian business 
sector.  The recently released federal budget of  March 19, 2007 has announced tax reductions, 
increased expenditures, and/or other initiatives in all five areas of the Advantage Canada  plan. 
 
II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
 
(1) OVERVIEW  
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 1] 
 
Question on paragraph 2 of page 11:   We note that, in addition to its multilateral track, Canada 
pursues regional and bilateral preferential trade in itiatives.  We understand, for example, that Free 
Trade Agreement (FTA) negotiations are now bei ng conducted with a number of Asian countries, 
such as Singapore and Korea.  Given our own clo se economic ties with Canada (currently its eighth 
largest trading partner and export market - counting th e EC as one), it occurs to us that our dynamic 
economy might also appeal to Canada as a sound  basis for developing an even closer economic 
partnership, or an FTA.  We believe there is pot ential for our trade negotiators to come up with 
something more in this direction that could be to our mutual advantage. 
 Could Canada please inform us of the criteria it us es to choose potential FTA partners and whether it 
has plans to launch any new FTA negotiations in 2007 with other countries in the Asia region? 
 
ANSWER:   Canada negotiates bilateral a nd regional WTO-consistent tr ade agreements to strengthen 
Canada’s competitive position in markets and impr ove opportunities for Canadian businesses.  Other WT/TPR/M/179/Add.1 
Page 182  
 
factors include a partner’s readiness for comp rehensive liberalization,  a partner’s general 
compatibility with Canadian interests and the Government of Canada ’s negotiating resource 
commitments.  Various domestic c onsultation mechanisms ensure that Canadian stakeholder interests 
are fully considered.  In terms of the Asia region,  Canada’s current bilateral free trade negotiations 
agenda is focused on the conclusion of ongoing negotiations.  
 [Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 2] 
 
Question on paragraph 31 of page 17:   As indicated, there are 22 bilateral investment agreements in 
force between Canada and other countries.  We noti ce that not all of the 22 agreements are part of 
FTA agreements and that in Canada’s GATS commit ments there is MFN exemption on the arbitration 
procedure of investor/state investment disputes for all services sectors.  When the bilateral investment agreement is not pa rt of an FTA, does Canada provide better market 
access for services investments than that provided for in its commitment in the GATS?  If so, we 
wonder how this complies with  Canada’s GATS obligations? 
 ANSWER:   Canada’s Foreign Investment Protection and Promotion Agreements (FIPAs) focus on 
investor protections, rather than market access.  Arb itration of investor-state disputes is a procedural 
issue, and is not a question of market access.  C opies of the text of Canada’s FIPAs are publicly 
available, and are not in conflict with  Canada’s obligations under the GATS. 
 
(4) FOREIGN INVESTMENT REGIME  Foreign investment system 
 
[Costa Rica Question 19] 
 
Question on paragraph 22:   Can any individual or corporation, domestic or foreign, file notification 
to establish a new company or acquire control of an  existing company?  What is the procedure for 
such notifications? 
 
ANSWER:   The Investment Canada Act applies only to foreign-controlled investors.  The investor 
can be an individual or corporation.  It does not ma tter if the foreign-controlled investor resides in or 
out of Canada.  Any foreign investor can file a notification,  the Act does not discriminate on 
nationality of investor or type of  investor.  Th e Investment Canada Act website provides forms for 
foreign investors to use.  They can be fo und at:  http://strategis.ic.gc.ca/epic/site/ica-
lic.nsf/en/h_lk00010e.html.  
[Singapore Question 1] 
 
Question 1(a):   The Secretariat Report mentions that a fo reign acquisition above a given threshold is 
subject to review to ensure that it results in a "net benefit" to Canada.  
 Could Canada clarify whether different thresholds  are applied to FTA partners, WTO members and 
non-WTO members?  
ANSWER:   For WTO members, the review threshold for a direct acquisition is $281 million for 
2007, and indirect acquisitions by WTO members are not reviewable.  Where the investor and seller 
of a Canadian business are both from non-WTO countri es and the acquisition is direct, the review 
threshold is $5 million, and where the acquisition is  indirect the review threshold is $50 million. 
  WT/TPR/M/179/Add.1 
 Page 183 
 
 
Question 1 (b):   How would these thresholds be applied should acquisitions be undertaken by joint 
ventures (eg., a 50:50 joint venture) involving co mpanies from countries with different applied 
thresholds?  ANSWER:   Where the investor is a 50%-50% joint venture and one investor is from a WTO member 
country and the other is from a non-WTO member country, the non-WTO threshold applies. 
 Question 1 (c):   We would also appreciate it if Canada could clarify whether there are any plans to 
amend the said legislation?  If so, when would this take place?  
ANSWER:   Canada regularly reviews the few remaining foreign investment restrictions and is aware 
of the benefits of further liberalization.  
[Turkey Question 1] 
 Question 1 (a):   The  Secretariat Report reflects that Canada belongs to the Group with the highest 
level of overall restrictiveness to Foreign Dir ect Investment as measured by the OECD’s FDI 
regulatory restrictiveness index.  It has been noted that there are sector-specific r estrictions to FDI and according to the Investment 
Canada Act, a foreign acquisition above a given threshol d is subject to review to ensure that it results 
in a “net benefit” to Canada. 
 Secretariat Report also highlights slow productivity growth as a feature of the economy, and indicates among others to remove restricti ons on foreign investment as a tool to accelerate productivity growth. 
 
Could Canadian Delegation elaborate on if there ar e any plans to remove restrictions to FDI? 
 ANSWER:   Canada regularly reviews the few remaining foreign investment restrictions and is aware 
of the benefits of further liberalization.  Question 1 (b):   We would also like to request the Dele gation of Canada to explain the terms and 
thresholds, if exist any, to assess the “net benefit criterion”.  Are these criteria applied on a sector 
specific basis?  
ANSWER:  
Thresholds:   For WTO members, the review threshol d for a direct acquisition is $281 million for 
2007, and indirect acquisitions by WTO members are not reviewable.  Where the investor and seller 
of a Canadian business are both from non-WTO countri es and the acquisition is direct, the review 
threshold is $5 million, and where the acquisition is  indirect the review threshold is $50 million. 
 Net Benefit Factors:   The factors of net benefit to Canada are clearly set out in Section 20 of the 
Investment Canada Act.  They are not applied on a sector specific basis, but one of the factors does 
mention the compatibility of the investment with government policies. 
 
Question 1 (c):   As a member of the APEC, which steps do es Canada take to achieve APEC’s goal of 
free and open trade and investment by 2010 for developed economies?  
 
ANSWER:  Canada is committed to achieving APEC’s goal of free and open trade and investment by 
2010, and continues to make progress towards this  objective.  For example, in 2005 Canada 
eliminated a number of MFN tariffs on a range of fibe rs, yarns and apparel fabri cs.  Further details on 
Canada’s efforts and achievements are publicly available in Canada’s  2006 Update to its Individual 
Action Plan, at www.apec-iap.org. 
 WT/TPR/M/179/Add.1 
Page 184  
 
Question 1 (d):   How does Canada consider to deal with  the problem of slow productivity growth? 
 Canada is preparing a written response to th is question which will be provided later. 
 
Question 1 (e):   Are there any plans to benefit from inv estment policies to achieve higher level of 
productivity in Canadian economy? 
 ANSWER:   As indicated earlier, Canada regularly reviews the few remaining foreign investment 
restrictions and is aware of the be nefits of further liberalization. 
 [Argentina Question 3] 
 
Question on paragraph 25, page 18:   Would Canada please explain the parameters under which it is 
determined that an investment “is likely to be of net benefit for Canada”?  Are there cases in which 
investments have been approved under this exception? 
 
ANSWER:   Under the Investment Canada Act a small num ber of foreign investments are reviewable.  
The factors of net benefit to Canada are clearly set out in Section 20 of the Investment Canada Act.  
No other issues can be taken into account.  Non-Ca nadian investors that are acquiring control of a 
Canadian business that is reviewable submit their plans for the Canadian business to the government 
for review.  The government assesses the plans against th e factors of ‘net benefit’ to Canada set out in 
section 20 of the Act.  Discussions may take place be tween the investor and government officials to 
clarify the investor’s plans.  When the review is complete, a summary report is sent to the Minister of 
Industry for a decision.  The intent of the Investment Canada Act is not to block foreign acquisitions, but to ensure that they 
benefit Canada. To date, with  one or two exceptions, all i nvestments have been approved.  
 
(5) INTERNATIONAL RELATIONS 
 (ii) Preferential Trade Agreements  
[Korea Question 3]  
Question 3(a) on Pages 19-22/Paragraphs 40-67:   Canada resumed FTA negotiations with the 
EFTA states and Singapore in November 2006.  In particular, the FTA negotiations with the EFTA 
states have reached their final stages.  We would like to kindly request Cana da to provide detailed 
information on the current situation of Canada's  FTAs, in particular with the EFTA states and 
Singapore.  ANSWER:  Canada’s free trade agreemen t negotiations with EFTA, Si ngapore and Central America 
4 are at different stages in the negotiating process.  Canada has not set a deadline for the conclusion of 
these negotiations.  More information on specific ne gotiations is available on the following Web site. 
http://www.international.gc .ca/tna-nac/menu-en.asp. 
 Question 3(b):  Furthermore, Canada has recently be gun to focus on FTA and RTA negotiations, 
although in the past it has given priority to the WTO/DDA negotiations.  We would like to kindly ask 
Canada to elaborate in detail on its plans to la unch FTA/RTA negotiations with countries other than 
those introduced in the TPR report.  
 
ANSWER:  The World Trade Organization (WTO) remains the cornerstone of Canada’s trade policy.  
At the same time as Canada maintains its focus on the WTO, Canada also recognizes the importance 
of bilateral and regional trade initiatives in further liberalizing trade in goods and services.  On March 
19, 2007, the Government of Canada tabled a budget, which includes the following statement: “To  WT/TPR/M/179/Add.1 
 Page 185 
 
 
expand our bilateral trade network, Canada is currently negotiating or  exploring the prospects for free 
trade agreements with several countries including  South Korea, Singapore, the Latin American 
countries of the Andean Community, the European c ountries of the European Free Trade Association, 
and countries of the Caribbean and Central Am erica.  Success in these negotiations will position 
Canada for further progress in opening markets for Cana dian business.  This renewed bilateral agenda 
does not mean that Canada is attaching less importa nce to our multilateral trade efforts in the World 
Trade Organization Doha Round. On the contrary, a successful Doha Round remains our main trade 
policy priority”.  
[Thailand Question 1] 
 
Question on pages 19-22:   Canada has a number of FTAs with its key trading partners.  Could 
Canada indicate those products whose market ac cess to Canada is normally limited or excluded from 
FTA negotiations?  
ANSWER:  In negotiating bilateral and regional Fr ee Trade Agreements, the Government of 
Canada’s objective is the elimination of tariffs on all non-agricultural goods and on a wide range of 
agricultural goods.  Although Canada maintains no non-agricultural product exclusions, some tariffs 
remain in place under Canada’s Free Trade Agreem ents, for example in supply-managed agricultural 
sectors which include dairy, eggs, a nd poultry products.  Specific tari ff line exclusions can be located 
under Canada’s Schedules to each of the agreements, which are available on the Web site of Foreign 
Affairs and International Trade Canada at:  www.international.gc.ca/tna-nac/reg-en.asp. 
 
PART III. Trade Policies and Practices by Measure 
 (1) Overview 
 
[Argentina Question 4]  
Question 4 on Paragraph 3, page 30:   Could Canada explain the reasons why the exemptions noted 
are applied to wine produced from Canadian-grown grapes and to beer made by domestic brewers? 
 
ANSWER:   The excise tax measures introduced in Cana da’s Budget 2006 is intended to help the 
competitiveness of small and medium-sized vintners and brewers.  These measures, which only apply 
to a small proportion of Canadian production, are not trade distorting and will have no impact on 
imports of wine and beer into Canada.  (2) MEASURES DIRECTLY AFFECTING IMPORTS  (i) Procedures  [Argentina Question 5] 
 Question 5 (a):   Could Canada explain which importers may participate in the “Customs Self-
Assessment” (CSA) program?  ANSWER:   Importers eligible to apply to the CSA program include those who are resident in 
Canada; have a history of actively importing for at least two years; are without contraband or major 
commercial infractions;  are prepared to make an  investment in business systems; are willing to 
provide senior management representation that commercial business processes, customs interfaces, and the required trigger, audit trails, and linkages exist or will exist in the business's books and 
records;  and are prepared to sign a C lient Undertaking document with the CBSA. 
 WT/TPR/M/179/Add.1 
Page 186  
 
Importers will have to give de tailed information such as their corporate structure and Business 
Number;  key business activities and products; compan y policies to minimize risk; and, upon request, 
a quarterly report or the most recent audited financial statement.  Importers will be asked to demonstrate that thei r books and records and business systems have, or will 
have, the necessary linkages, controls, and audit tra ils to support CSA program requirements such as:  
an account security number;  the accounting option selected; an internal business monthly cut-off 
date;  a business system trigger for customs accoun ting; a way to capture the receipt date in the 
commercial system;  a way to distinguish commerc ial importations from dom estic purchases;  and a 
sweep process to account for goods not accounted for by trigger. 
 
Importers must also submit a list of their U.S. vendors and direct-deliver y (domestic) consignees.  
CSA-approved importers may be asked to sign a Cl ient Undertaking document which will include an 
outline of the roles and responsibilities of the impor ter or carrier, agreed-on accounting and payment 
time frames, and references to possible contraven tions and resultant penalties.  The document will 
also outline how the CSA client and the CBSA can work together to suppress contraband smuggling. 
 The CSA program gives approved importers the bene fits of a streamlined accounting and payment 
process for all imported goods.  The streamlined acc ounting and payment process ends the need for 
importers to maintain separate and costly customs processes, allowing them to use their own business 
systems to fully self assess and meet their customs obligations. 
 
Question 5 (b):   How are the streamlined accounting and corresponding payment process carried out 
in practice?  ANSWER:   Under the CSA streamlined accounting and payments processes the CSA eligible goods 
are authorized for delivery and are released prior to final accounting without the requirement for 
interim accounting.  The CSA importer is res ponsible for initiating the accounting from their own 
business systems, as soon as the good are under CSA.  The CSA importer self-assesses and summarizes all commercial revenue amounts, which are reported on a single monthly report called a 
Revenue Summary Form.  The importer only need s to remit the amount reported on the Revenue 
Summary Form once per month, at a financial ins titution.  Most adjustments are transmitted to CBSA 
electronically and some may be consolidated.  The supporting documentation submitted at time of 
accounting is also reduced.  
[Pakistan Question 2] 
 Question 2:   While there is liberal trade environmen t for industrial goods, some non-tariff barriers 
like undue delay of containers at the port of landi ng, diversion of cargo to other ports and inspection 
hassles add to the cost of doing business; and disc ourage Canadian importers to retain the supply 
chain with the established partners.  Would Canada like to explain the reasons as to why imports coming from developing countries are 
subjected to discriminatory practices;  and does Ca nada have any plan to redress such grievances? 
 ANSWER:   Canada's import policies are administered and applied in a fair and consistent manner 
based on our laws and regulations.  The CBSA's co mmitment to fairness is based on six pillars:  
respect and courtesy, fair application of the la w, privacy and confidentiality, bilingual service, 
accurate information about entitlements and obligations , and review of our actions or decisions (first 
link below).  The publication entitled Guide to Importing Commercial Goods
 provides information 
that is applicable to all goods that are imported into Canada (second link below). 
 http://www.cbsa-asfc.gc.ca/agency -agence/fairness/menu-e.html. 
  WT/TPR/M/179/Add.1 
 Page 187 
 
 
http://www.cbsa-asfc.gc.ca/E/pub/cp/rc4041/rc4041-e.html.  
[India Question 1] 
 
Question:   We have been informed by small scale exporters from India that they are facing payment 
problems as importers in Canada are not honour contra ctual obligations.  As the scale of such business 
operations is small therefore they find it difficult to  resort to costly and time consuming legal recourse 
and this also constitutes a NTB.  We request Canada  to inform if any mech anism is put in place to 
investigate such cases and provide assistance to small scale exporters from developing countries. 
 
ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
 
(iv) Tariffs 
 [China Question 1] 
 
Tariffs 
 
Question 1 (a):   Canada still maintains fairly high tari ffs on some products.  High tariff is still a 
major barrier to the export of te xtiles, especially clothing, to Canada.  For example, tariffs on wool 
and synthetic fiber is 16%, and those on clothing are from 17.5% to 21%. Besides, tariffs on vessels 
and some safety apparatus for ice hockey are fairly high as well. 
 Could Canada please explain the reason for maintaining tariff peaks in these sectors?  ANSWER:   More than half of Canada’s tariffs are app lied at a zero rate of duty.  The other tariffs 
reflect Canada’s negotiated WTO commitments. 
 Question 1 (b):   Does Canada have any plan to lower them? 
 ANSWER:  Canada is an active participant in the D oha Round of negotiations, and is a strong 
supporter of the use of the harmonizing Swiss tariff reduction formula in NAMA that will 
substantially reduce all Members’ tariffs. 
 
[China Question 2] 
 
Question 2 (a):   Canada still applies tariff quotas to some  agricultural products, including eggs and 
egg products, milk, turkey and turkey products, beef, chicken and chicken products, etc.  For example, 
the out-of-quota tariff rate on imported milk is 243% with the tariff rate not lower than CAN$2.82 per 
kilo.  For other dairy foods for smearing, the out-of-quota tariff rate is as high as 313.5% and those on meat and edible offal of the poultry (fresh, ch illed or frozen) are as high as 154.5% and 238%. 
 Could Canada please explain the reason for mainta ining such high out-of-quota tariff rates on these 
agricultural products? 
 ANSWER:  Canada’s tariffs reflect the implementation of its WTO commitments. 
 Question 2 (b):   Does Canada have any plan to lower them? 
 
ANSWER:   Canada is an active participant in the Doha Round of negotiations. 
 WT/TPR/M/179/Add.1 
Page 188  
 
[Hong Kong China Question 1] 
 
Question on P. 31-32, Paras. 37, 39 & Table III.1:   We appreciate that Canada has bound 99.7% of 
its tariff lines and that the simple average applied tariff had declined slightly from 6.8% in 2002 to 6.5% in 2006, due to tariff reductions following the implementation of WTO commitments.  We note 
from the Secretariat Report that for 23 tariff lines, the ad valorem equivalents could not be estimated.  
Grateful for the clarification from Canada.  ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 3] 
 
Question on paragraph 46 of page 33:   Regarding the General Preferential Tariff (GPT), the 
Secretariat’s Report states that, since the last Revi ew in 2003, Mongolia and Oman have been added, 
while ten new EC Member States were re moved from the list of beneficiaries. 
 Could Canada please elaborate further on the criteria used and the procedures followed in the process 
of adding or removing GPT beneficiaries? 
 ANSWER:   Canada's General Preferential Tariff (GPT) provides preferential tariff treatment for most 
imports from developing countries.  It was introdu ced in 1974 as part of a concerted international 
effort by developed countries to assist developing countries in expanding their exports and stimulating 
their economic growth.  Canada determines which countries will beco me beneficiaries of Canada's 
GPT based on a wide range of economic, developmen tal and commercial concerns.  Over the years, it 
has been the practice in Canada to withdraw entitlement to the GPT from countries acceding to the 
EU, as accession provides membership in a highl y developed and integrated economic entity. 
 
Decisions on adding or removing countries from the lis t of Canada's GPT beneficiaries are made by 
the Government.  Usually the Minister of Fore ign Affairs recommends changes to the list of 
beneficiaries to the Minister of Finance.  If the Mi nister of Finance concurs with the course of action, 
a proposal indicating the Government's intention is p ublished in the Canada Gazette.  The Minister of 
Finance is responsible for recommending to the Government that the Customs Tariff be amended to 
make changes to the list of GPT beneficiary countries. 
 
(v) Other charges affecting imports 
 [Turkey Question 2]  
Question on para. 57:   According to the Secretariat Report, the goods and services are levied under 
the Excise Tax Act which is defined as the Canada’s  largest indirect tax by revenue, amounting to 
around 15% of total federal budgetary revenue.   2(a):   Could Canadian Delegation clarify the reason to this tax arrangement? 
 2(b):  Could Canadian Delegation confirm the all imports regardless of their sources are 
 levied under the excise tax?  ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
 
[Argentina Question 6] 
 
Question on paragraph 59, page 43:   Could Canada explain why some provinces apply the HST and 
others do not?  Why is this tax a pplied at different rates for differe nt products?  Is there a publication 
one can consult for the rates applied to various products? 
  WT/TPR/M/179/Add.1 
 Page 189 
 
 
ANSWER:  Canada is preparing a written response to th is question which will be provided later. 
 
(vi) Quantitative restrictions 
 [China Question 3] 
 
Quantitative restrictions and licensing  
 
Question 3 (a):   The import and inter-provincial trade of al coholic beverage in Canada are subject to 
the Importation of Intoxicating Liquors Act, whic h gives provinces much discretion over the sale, 
import and inter-provincial transpor tation of spirits.  Currently, Provincial Liquor Board (PLB) is the 
sole agency to exercise the above policies, wh ich include: imposing a higher mark-up on imported 
products than on domestic like pr oducts;  setting floor and ceiling prices on imported products;  etc. 
 Please explain the reasons for adopting these measures ? 
 
ANSWER:   In Canada, the importation a nd inter-provincial/territorial trad e of alcoholic beverages is 
governed by the federal Importation of Intoxicating Liquors Act  (IILA).  The objective of the IILA 
relates to the control of the consumption of al coholic beverages in Canada for the purpose of 
protecting public health and morals. 
 
Question 3(b):   What is the basis on which the Provincial Liquor Board (PLB) sets floor and ceiling 
prices on imported products?  
 
ANSWER:   Provincial/territorial Liquor Boards may set  floor prices based on social responsibility 
considerations - it is well known that lower prices lead to increased consumption.  These prices are 
established normally based on the alcohol content of the beverage - different products have different 
levels of alcohol and therefore have different cons umption patterns and risk factors.  For example, a 
strong beer product at 10% alcohol/volume would have  a higher floor price than a regular 5% alc/vol 
beer for the same volume of product.  The prices are established by the competent authority in the 
respective province/territory based on their best ju dgement as to what price will have the desired 
effect on consumption.  The floor prices appl y to both domestic and imported products.  Ceiling 
prices are not used.  
 
Question 3 (c):   Please explain the conformity of the above policies with the national treatment 
principle of the WTO? 
 
ANSWER:   The Provincial/Territorial Liquor Boards ( PTLBs) in Canada were established before the 
GATT was created, and their existence and activity is  consistent with the provisions of GATT Article 
XVII [“State Trading Enterprises”].  In accordance with that Article, they are notified to the WTO as 
STEs.  The PTLBs operate as businesses whose purch ase and sales decisions are based solely on 
commercial considerations and market forces.  Th e alcoholic beverage-pr oducing countries which are 
major exporters to Canada have accepted the polic ies of Provincial liquor agencies through various 
bilateral agreements.  Canada's commitments under these agreements are implemented on an MFN 
basis.  
[Korea Question 5] 
 
Question on Prohibition against the Importatio n of Used Motor Vehicles, p.38 para.69:  
Importing used motor vehicles of all kinds is prohi bited by the Canadian government.  Exceptions 
include used motor vehicles that are 15 years or older and those imported from the United States.  The 
policy regarding the import of used vehicles from Me xico is also being progressively liberalized. 
 WT/TPR/M/179/Add.1 
Page 190  
 
According to Article 11 of the 1994 GATT, member s should eliminate quantitative restrictions.  The 
Korean government is concerned that the Canadian  government's policy regarding the import of used 
vehicles does not coincide with the regulations of the WTO. 
 
What is the Canadian government's position on openi ng its used motor vehicles market by amending 
its related regulations? 
 
ANSWER:   The progressive liberalization in respect of Mexico is a result of the NAFTA.  Regardless 
of the NAFTA provisions, used vehicles from Mexico will have to follow the same rules as those for 
U.S. vehicles, i.e. that they have to be modifiable  to meet Canadian safety standards and subsequently 
modified to meet the requirements.  
Quantitative restrictions are allowed by the GATT 1994 under certain conditi ons.  This is amply 
demonstrated by the notifications to the WTO of quantitative restrictions maintained by Members. 
 
As these regulations are in place for safety reasons, there is no current intention to liberalize them. 
 
[Argentina Question 7] 
 
Question on paragraph 69, page 47:   Please indicate whether there are other products, besides those 
listed in this paragraph, w hose importation is prohibited. 
 ANSWER:   Other products for which importation is pr ohibited include true hemp (HS 5302.00.00), 
raw or processed but not spun; tow and waste of true  hemp (including yarn waste and garneted stock);  
white phosphorous matches (HS 9897.00.00);  used mattresses (HS 9897.00.00);  and hate 
propaganda and obscene materials (HS 9899.00.00). 
 
(vii) Contingency measures 
 [China Question 4]  
Question 4 (a):  Sections 30.2-32.22 of the Canadian International Trade Tribunal Act provides for 
the procedures regarding special safeguard and temporary safeguard measures against imports of specific Chinese products.  Please elaborate the rationale and basis for the low threshold to init iate investigations. 
 
ANSWER:   The Canadian International Trade Tribunal (CITT) is required to initiate a safeguard 
inquiry into market disruption or trade diversion in  respect of imports of specific Chinese products if 
the Canadian industry files a complaint with the required information, the complaint is made on 
behalf of domestic producers who produce a majo r proportion of the domestic production of the like 
or directly competitive goods, and the CITT is sa tisfied that the information provided by the 
complainant and any other information examined by the CITT discloses a reasonable indication that 
the imports are being imported in such increased quantities or under such conditions as to cause or 
threaten to cause market disruption to domestic pr oducers, or that an action causes or threatens to 
cause a significant diversion of trade into the domestic market of Canada.  The “reasonable 
indication” and major proportion thresholds are the same standards that the CITT is required to use 
when initiating global safeguard inquiries. 
 
Question 4 (b):   Please explain why the procedures lack specific provisions on consultation, hearing 
and confidentiality. 
  WT/TPR/M/179/Add.1 
 Page 191 
 
 
ANSWER:   Canada is obligated to follow the consu ltation requirements set out in Protocol on the 
Accession of the People’s Republic of China (WT/L/ 432).  However, such consultations requirements 
are not set out in Canada ’s domestic legislation. 
 The requirement to provide a hearing is b ased on well-established principles of Canadian 
administrative law relating to “natural justice”.  Under Canadian law, the scope of a hearing is 
dictated by the nature of the proceedings.  In this  regard, the CITT, consistent with its quasi-judicial 
nature, holds public hearings in which each party is  afforded a full and fair opportunity to present its 
views and defend its interests.  
Information provided to the CITT for the purposes of any proceedings before the CITT are subject to 
the confidentiality and disclosure of information provisions of secti ons 43-49 of the CITT Act, which 
include rules concerning the protection of confidential information. 
 
Question 4 (c):   What are the criteria used in the Act to determine the existence of market disruption 
and trade diversion? 
 
ANSWER:   The criteria used to determine the existen ce of market disruption are found in subsection 
30.22(6) of the CITT Act, as well as section 5.1 of the CITT Regulations.  The criteria used to determine the existence of trade diversion are found in subsection 30.23(6) of the CITT Act and 
section 5.2 of the CITT Regulations.  These criteri a are consistent with Canada’s rights and 
obligations negotiated as part of China’s accession to the WTO. 
 
CITT Act 
 
30.22 (6)  The Tribunal shall, in the inquiry into the co mplaint, determine whether, having regard to 
any regulations made pursuant to paragraphs 40( a) and ( k.1), the goods originating in the People's 
Republic of China that are the subject of the comp laint are being imported in such increased quantities 
or under such conditions that they cause or threaten  to cause market disruption to domestic producers 
of like or directly competitive goods.  30.23 (6)  The Tribunal shall, in the inquiry into the co mplaint, determine whether, having regard to 
any regulations made pur suant to paragraphs 40( a) and ( k.1), an action causes or threatens to cause a 
significant diversion of trade into the domestic market in Canada. 
 
CITT Regulations 
 5.1 For the purposes of determining, during an inquiry into a matter referred to the Tribunal pursuant 
to paragraph 30.21(1)( a) of the Act or an inquiry into a compla int referred to in subsection 30.22(6) of 
the Act, whether the goods originating in the People’ s Republic of China that are the subject of the 
reference or complaint are being imported in such  increased quantities or under such conditions as to 
cause or threaten to cause  market disruption to domestic producers of like or directly competitive 
goods, the Tribunal shall examine, among other factors,  
 
 ( a) the actual volume of the goods originating in  the People’s Republic of China that are 
 imported into Canada;    ( b) the effect of the imported goods on prices of like or directly competitive goods in Canada; 
 and 
  ( c) the impact of the imported goods on domestic  producers of like or directly competitive 
 goods in Canada.  WT/TPR/M/179/Add.1 
Page 192  
 
5.2  For the purposes of determining, during an inquiry  into a matter referred to the Tribunal pursuant 
to paragraph 30.21(1)( b) of the Act or an inquiry into a compla int referred to in subsection 30.23(6) of 
the Act, whether an action causes or threatens to  cause a significant diversion of trade into the 
domestic market in Canada, the Tribunal shall exam ine, among other factors and to the extent that 
evidence is reasonably available to support such examination,  
 
 ( a) the actual or imminent increase in market share of goods originating in the People’s 
 Republic of China in Canada;   ( b) the nature or extent of the action; 
 
 ( c) the actual or imminent increase in the im portation of goods originating in the People’s 
 Republic of China that is due to the action;    ( d) the conditions of supply and demand in the domestic market for the like or directly 
 competitive goods;  and 
  ( e) the volume of the goods originating in the People’s Republic of China that are imported 
 into Canada and into any WTO Member taking an action.  
[China Question 5] 
 
Question:   Canada’s Special Import Measures Act (SIMA) and Chapter 2 and 3 of Special Import 
Measures Regulations contain specific provisions regarding the amount of subsidy and the initiation, investigation and determination.  
The simplicity of the Act’s provisions regarding th e existence, amount and nature of a subsidy, 
particularly on the burden of proof on complainants , tend to result in an easy determination of the 
existence of a subsidy.  Could Canada please explain their consiste ncy with Article 11.2(ii) of the ASCM? 
 
ANSWER:   Under the  Special Import Measures Act  (SIMA) a complaint by a Canadian industry will 
not result in the initiation of an investigation unless it is "properly documented".  In this regard, under 
subsection 2(1) of the SIMA, a complaint is not to be considered “properly documented” unless it, 
among other things,  "specifies the goods"  in terms of description and source, while paragraphs (d) and 
(e) of section 37 of the  Special Import Measures Regulations  explicitly require information on each 
known foreign producer/exporter and ea ch known Canadian importer of the specified goods.  As such, 
the requirements of Article 11.2 of the ASCM are fully reflected in Canadian law.  
[China Question 6] 
 
Question 6 (a):   On November 3
rd, 2006, CBSA issued th e Statement of Reasons for the preliminary 
determination regarding the countervailing invest igation against copper pipe fittings.  While 
calculating the subsidy amount, CBSA estimated the amount through comparing the average export price of the products under investigation with  the production costs provided by Canadian 
complainants.  
Could Canada please explain the reason not to take into account the information provided by the 
Chinese side? 
 
ANSWER:   The reasons why the CBSA did not take in formation provided by the Government of 
China into account for purposes of the Preliminary De termination are fully explained in paragraphs 
118-120 of its Statement of Reasons .  WT/TPR/M/179/Add.1 
 Page 193 
 
 
Question 6 (b):   CBSA used a “constructed price” similar to that used in antidumping investigations 
in calculating amount of the subsidy.  How does Cana da explain its consistenc y with Article 14 of the 
ASCM? 
 
ANSWER:   Article 14 requires that, for the measures it describes (i.e., the provision of equity capital, 
loans, loan guarantees, goods/servi ces, or the purchase of goods), methodologies for the calculation of 
amounts of subsidy must conform to the guidelines therein prescribed.  The Article cannot however 
be considered exhaustive (e.g., it does not prov ide guidelines for the calculation of amounts of 
subsidy associated with financial contributions describ ed in Article 1.1(a)(1)(ii) of the Agreement or 
royalty-based financing).  In this regard, th e methodology employed by the CBSA, including its 
recourse to facts available pending verification of late  information, is entirely consistent with Article 
12.7 of the ASCM, which provides relevant context.  
[China Question 7] 
 
Question:   On April 28
th, 2004, Canada initiated investigat ion into the alleged dumping and 
subsidizing of Chinese Carbon & Stainless Steel Fast eners.  In the investigation, the Canadian 
authority adopted the Best Information Available (BIA) to determine a 31.5% subsidy amount simply 
on the ground that the information provided by the Chinese government is incomplete and that the 
information provided by government and by en terprises is inconsistent with each other. 
 
Please explain the conformity of this practice to the ASCM of WTO. 
 
ANSWER:   Where, in a countervail investigation, the exporter or foreign government concerned fails 
to provide necessary information, or where informat ion provided is found to be unreliable, there is 
nothing in the ASCM precluding recourse to best in formation available.  In this regard, reference 
should be made to Article 12.7 of the ASCM on the use of facts available. 
 
Antidumping and countervailing measures 
 
[Costa Rica Question 4] 
 Question on Paragraph 74:   What reasons or criteria does Canada have for requiring that 
undertakings be offered only by exporters or fore ign governments that account for at least 85% of the 
total volume of imported pr oducts under investigation? 
 In accordance with the Canadian legi slation on the topic, would any undertaking offered that does not 
meet that percentage be rejected ad portas? 
 ANSWER:   Under Article 8.3 of the Antidumping Agr eement and Article 18.3 of the Agreement on 
Subsidies and Countervailing Measures , undertakings offered need not be accepted if the authorities 
consider their acceptance impractical, for example, if the number of actual or potential exporters is too great, or for other reasons, incl uding reasons of general policy.  
 
As a matter of general policy, undertakings are only accepted by Canada’s authorities if they cover all or substantially all of the vol ume of dumped or subsidized imports.  In cases where there are 
numerous exporters, it would be impractical to suspend an investigation and administer an 
undertaking for certain exporters but continue the i nvestigation for others.  Therefore, it is not a 
question of discrimination against small exporters, but a question of administrative practicality and 
general policy.  WT/TPR/M/179/Add.1 
Page 194  
 
Safeguards 
 [Costa Rica Question 5]  
Question:   Could Canada apply a tariff lower than that determined in the investigation of a safeguard 
provision if the corresponding authorities consider that it is not in the public interest?  In other words, 
could public interest criteria be applied to investig ations into safeguard measures in the same way as 
they are applied to proceedings on anti dumping and/or countervailing measures? 
 
ANSWER:   Canada does not have specific public interest  provisions in its safeguard legislation.  
However, the government takes overall public interest  factors into account when deciding whether or 
not to impose a safeguard measure after an affirmative injury finding by the CITT. 
 
[Hong Kong, China Question 2] 
 Question on P. 42, Para. 82:   We are interested in the operation of the public interest enquiry as 
reported in paragraph 82 of the Secretariat Report.  a) In particular, we would like to know wh ether it is mandatory for CITT to conduct 
 public interest enquiries when ever requests are received. 
 
b) Also, is CITT empowered to initiate such an  enquiry on its own without a request from the 
 trade?  c) If yes, has any such enquiry been conducted before?  ANSWER:  
a) The CITT must initiate a public interest inquiry on  the request of an interested party if it is of 
 the opinion that there are reasonable grounds to consider that the imposition of an anti- dumping or countervailing duty, or the imposition of such a duty in the full amount, would  not be in the public interest. 
 
b) The CITT is empowered to initiate a public inter est inquiry on its own initiative, if it is of the 
 opinion that there are reasonable grounds to consider that the imposition of an anti-dumping  or countervailing duty, or the imposition of such  a duty in the full amount, would not be in the 
 public interest. 
 
c) The CITT has never conducted a public interest inquiry on its own initiative. 
 
[Korea Question 7] 
 
Question on pp.38~44 para.71~92:  At end June 2006, 48 anti-dumping measures, one price 
undertaking and five countervailing duty or ders remained in force in Canada. 
 
Contingency trade measures should be placed to protect domestic industries from unfair foreign trade 
practices in exceptional cases.  Given that even an  initiation of an investigation affects the business 
activities of the company under investigation by impos ing additional burdens, Canada is requested to 
be more cautious before taking such measures.  
 We are pleased to note that the current (as of Jun 2006) number of trade remedy measures taken by 
Canada has significantly dropped (Anti-dumping measures: 91 → 48, Countervailing duties: 10 → 5) 
in comparison with the past (during the TPR in 2003 ).  Continuing with this trend, Canada is 
requested to be more cautious befo re taking such contingency measures.   WT/TPR/M/179/Add.1 
 Page 195 
 
 
ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
 
(viii) Technical regulations, confor mity assessments, and standards 
 
[Argentina Question 1] 
 
Question on paragraphs 93 to 115 (pp. 55 to 60 in Spanish version,  pp 44-48 in English version):  
Considering the obligations of members in articles 3.5 and 7.5 and other app licable provisions of the 
WTO, could Canada describe in de tail the efforts that it has made to avoid different treatment between 
certification and labelling requirements for the sale of  organic products applied separately by Canada 
and by the province of Quebec (the first are voluntary and the second, obligatory)?  Can we expect a 
change in these requirements that seem to limit the fr ee movement of goods in the country and to be a 
way to disqualify products and suppliers?  ANSWER:   The Organic Products Regulations  (OPR) were published in Canada Gazette, Part 2  on 
December 21, 2006.  These regulations were notif ied to the WTO (G/TBT/N/CAN/177/Rev.1).  As 
indicated in the notification, the purpose of the Re gulations is to establish a system by which the 
Canadian Food Inspection Agency (C FIA) as competent authority can regulate the use of the “Canada 
Organic” agricultural product Legend.  They incl ude a requirement for imports of agricultural 
products labelled as organic to be accompanied by an  attestation issued by the competent authority of 
the country of origin, attesting that the product meets the requirements of these Regulations. 
 
As trade in organic products moves from provincia l markets to global markets, or vice versa, the 
national Organic Products Regulati ons will apply.  The provincial system in Quebec will apply only 
to trade within Quebec.  
The Organic Products Regulations facilitate inter- provincial and international trade of organic 
products by bringing conformity to the regulatory requirements across all provinces for the trade of such products in Canada.  The regulations will ensu re that organic products are treated equally when 
marketed in Canada, whether domestic or imported.   In essence, the regulations level the playing 
field, ensuring that domestic and international pr oducers face the same requirements for market access 
in Canada. 
 
In other words, the Quebec regulations will not appl y to organic products traded between provinces or 
internationally (import or export).  
[China Question 8] 
 
Technical regulations, Conform ity Assessment, and Standards 
 
Question 8(a):   Regulations on Fresh Vegetables  and Fruits  contain specific requirements on the 
size, weight and labeling of packaging.  For instance, the net weight in a pack  for apples, apricots, 
peaches and pears sold in Canadian market shall not surpass 200 kg (442 pounds). 
 
What are the basis for all the specificat ions on packing contained in the Act? 
 
ANSWER:   Packaging requirements were introduced in to Canada’s regulatory framework for fresh 
fruit and vegetables in the early 1930's.  The introduction of the packaging requirements was intended 
to support orderly marketing by preventing fraudulen t or deceptive packaging practices at an industry 
and consumer level, while main taining integrity in the quality of the produce being marketed. 
 Apples, peaches, pears, and apricots may be packaged  in any size container up to 200 kg (441 lbs) and 
be marketed in Canada.  Current requireme nts provide for packaging size innovation. 
 WT/TPR/M/179/Add.1 
Page 196  
 
Question 8 (b):   For the purpose of trade facilitation, does Ca nada plan to streamline its requirements 
on packing?  
 ANSWER:   At this time, Canada is not proposing any changes to the packaging requirements 
outlined in the Fresh Fruit and Vegetable Regulations . 
 
[China Question 9] 
 
Question:   For imported fresh and processed vegetabl es and fruits over the packing limit, Canada 
requires that the importers shall provide evidence of  short supply of the product in domestic market in 
order to obtain government’s import permit. 
 Does this imply that packing requirement s are related to import restrictions? 
 Canada is preparing a written response to th is question which will be provided later. 
 
[China Question 10] 
 
Question:   Although Canada’s Textile Labeling Act  does not require marking of the filled fibers, the 
provinces of Quebec, Ontario and Manitoba request  that each filled costume or toy should have 
special label indicating the filled fibres and that manufacturers of these products must get registered in 
provincial authorities according to the three provinces’ relevant laws with a registration fee of 400 
Canadian dollars.  How does Canada ensure the uniform application of  its policy regarding labeling requirements across 
the country?  
ANSWER:   The Competition Bureau, Industry Canada, ensures the administration and enforcement 
of the Textile Labelling Act whereas provincial re gulations are additional and only apply to the 
provinces where upholstered and stuffed regulations  exist, Ontario, Quebec and Manitoba.  The 
Federal Government does not have any power over pr ovincial regulations.  Consequently, it is up to 
the provinces to administer and enforce those pr ovincial regulations within their own provinces. 
 Technical Barriers to Trade  [Costa Rica Question 1] 
 Question on paragraph 93:   What means of coordination exist in Canada to prevent contradiction 
between the technical regulations issued by the fe deral, provincial and territorial governments?  In 
what ways could this affect trade? In the case of  a dispute, what procedure exists to resolve it?   
 ANSWER:   Federal regulatory policy requires federa l regulators to respect intergovernmental 
agreements such as the Agreement on Internal Trad e (AIT) and to take full advantage of opportunities 
for coordination with other na tional orders of government. 
 The AIT requires any government proposing to ad opt or modify a measure, that may have trade 
implications, to provide advance no tification of its intention to the other governments with an interest 
in the matter.  Other governments are provided wi th an opportunity to comment on the measure.  
Their comments should be taken into considera tion before the implementation of the measure. 
 The AIT restrains governments from adopting measures that restrict or prevent the movement of 
persons, goods, investments or services across provinc ial boundaries or create an obstacle to internal 
trade.  Governments also agreed to cooperate w ith a view to reducing an d eliminating differences,  WT/TPR/M/179/Add.1 
 Page 197 
 
 
duplications or overlaps in regulatory measures or  regulatory regimes which create an obstacle to 
internal trade.  The AIT features a formal dispute settlement mechanis m to deal with complaints regarding a measure 
under one of the sectoral chapters.  It is accessible to governments, individuals and the private sector.  
Prior to engaging in a formal dispute, government s and complainants are required to make every 
attempt to arrive at a mutually satisfactory resolution.  The dispute procedures include various mechanisms such as consultations and the establishment of a panel: 
 
• Consultations involves an exchange of inform ation between disputing parties on the measure 
that impact trade;  and 
• In the last step, a panel may be called upon to  review the dispute and reach a decision on the 
measure in question and make recommendations to resolve the dispute. 
 
[Costa Rica Question 2] 
 
Question on paragraph 97:   What percentage of the technical regulations notified by Canada during 
the period under review is based on international standards?  
 ANSWER:   WTO-TBT members are only required to notify technical regulations not
 based on 
international standards, where the proposed regula tion will have an effect on trade and where such 
standards exist or their preparation is imminent .  As such, Canada’s policy is to follow this 
requirement of the TBT agreement (Article 2.4).  However, there are occasions when, in the interest 
of increased transparency, Canada may provide no tification of a new or amended regulation to 
indicate its compliance with an international st andard, although this is  not required under the 
transparency obligations of the TBT Agreement.  
[Costa Rica Question 3] 
 
Question on paragraph 103:   What aspects are taken into account in assessing the impact of 
technical regulations?  What happens if the cost -benefit ratio leans toward greater cost of the 
regulations as compared to their benefits?  
 
ANSWER:   The Government of Canada Regulatory Policy requires regulators to examine all 
potential impacts (e.g. social, environmental and economic) of a proposed regulation on Canadian 
society (i.e. citizens, their governments and business).  The policy objective of this approach is to 
ensure that the use of the government's regulatory powers results in the greatest net benefits to Canadian society.  This information is then  used, along with other information (e.g. legal 
requirements, stakeholder input etc.), by Treasu ry Board Ministers in coming to a decision. 
 
[Korea Question 6] 
 Question on p.44 para. 93:  Although the Canadian federal gove rnment requires manufacturers to 
mark only fiber in textiles on clothing labels, some provincial governments, such as Quebec, Ontario and Manitoba, require manufacturers to attach a la bel disclosing the fiber content of the filling for 
stuffed garments, such as down coats. Additionally,  manufacturers that produce stuffed garments are 
required to register with provincial authorities at a cost of CDN$400.  
 
Does the Canadian government have plans to uni fy provincial labeling regulations with the 
regulations of the federal government , particularly with regards to the content of stuffed garments?  
 
ANSWER:   The Competition Bureau, Industry Canada, ensures the administration and enforcement 
of the Textile Labelling Act whereas provincial re gulations are additional and only apply to the WT/TPR/M/179/Add.1 
Page 198  
 
provinces where upholstered and stuffed regulations  exist, Ontario, Quebec and Manitoba.  The 
Federal Government does not have any power over pr ovincial regulations. Consequently, it is up to 
the provinces to administer and enforce those pr ovincial regulations within their own provinces. 
 
The provincial stuffed article rules are health and safety oriented, intended to ensure consumers are 
not harmed by unsanitary stuffing. Requirements have been harmonized among the noted provinces 
under Canada's Agreement on Internal Trade:  http://cmcweb.ca/epic/site/cmc-cmc.nsf/en/h_fe 
00013e.html.  
 
All consumer textile articles identified in Sche dule I of the Textile Labelling and Advertising 
Regulations and which are offered for sale in Canada  must be labelled in accordance with the Act and 
its Regulations.  This includes most consumer tex tile articles of clothing worn by or carried on the 
person, but also draperies, towels, bedspreads, tents,  etc.  It serves to standardize labelling information 
business that must apply and to ensure consumers re ceive adequate and accurate information to make 
informed choices.  Schedule I should be referred to for the complete list of articles which are subject 
to the labelling requirements, i.e. fibre content disclosure and dealer identity. 
 There are no plans to harmonize the federal and provincial requirements regarding upholstered and 
stuffed articles.  
[India Question  2] 
 
Question:   We have come across reports from Indian e xporters of spices to Canada that the labeling 
requirements in respect of spices are not standard ized and therefore it creates complications at the 
time of import clearance and sale in the domestic market.  May we request Canada to put in place a 
standardized system of labeling to assist the exporters  of such products from India and other interested 
countries.  ANSWER:   Canada's labelling requirements for food pr oducts including spices are extensive.  There 
are regulations prescribing the common name that must be used, the manner and format how ingredients must be declared and many other manda tory labelling information.  Chapter 2 from the 
Guide to Food Labelling & Advertising is a plain English guide on the labelling requirements for food 
products, which includes spices.  It can be found at the following web sites:  http://www.inspection.gc.ca/englis h/fssa/labeti/guide/ch2e.shtml 
http://www.inspection.gc.ca/englis h/fssa/labeti/guide/ch2ae.shtml 
http://www.inspection.gc.ca/englis h/fssa/labeti/guide/ch2-1e.shtml 
 
Standardized common name and comp ositional standards for spices 
Currently the Food and Drug Regulations have prescr ibed standards of composition for 39 spices. 
However, just because a spice does not have a presc ribed standard of composition, does not mean it 
can not be sold as a spice.  The Food and Drug Re gulations defines the common name to be the name 
prescribed by the Food and Drug Regulations or other fe deral regulations and if it is not prescribed by 
regulations, it is the name by which the product is generally known.  Spices with no prescribed 
standardized common name in Canada would be re quired to use the common name by which it is 
generally known as in the Canadian marketplace.  If  it is not a commonly used spice in Canada, the 
English and French common names used for the spi ce in the international market can be considered. 
 
Canada would be pleased to consider additional in formation from India on the nature of the problems 
faced by Indian exporters with regards to labeling of spices.   WT/TPR/M/179/Add.1 
 Page 199 
 
 
(ix) Sanitary and Phytosanitary Measures 
 [China Question 11] 
 
Question:   The Canadian Food Inspection Agency (CFI A) used the same test procedures and test 
standards with regard to aluminium tins and alloy tins when testing the completeness of tin pack.  
Therefore, it is difficult for aluminium cans to pass the test.  Please explain the reasons for using the same testing procedures and standards for both aluminium tins and alloy tins.  
 
ANSWER:   This manual has been prepared to assist qua lity control and inspection personnel tasked 
to evaluate the integrity of rigid metal cans - whet her aluminium or alloy.  Can integrity - the ability 
of the can to deliver safe wholesome food to the c onsumer - may be compromised by a wide variety 
of defects.  These defects may arise throughout the various stages of can manufacture, filling, closing, 
processing, and handling before the can reaches the consumer.  The defect types are arranged into 
seven different sections to reflect the stage in  which the defect is likely to originate. 
 The material presented in this manual:   1. Provides a base for assessment of container integrity using specific criteria; 
 2. Assists in communicating the specific defect conditions which may be found using 
  standardized terminology;  and  3. Provides a severity classification of the various defect types using standard criteria.  The defect classification standards used in this ma nual are those which Canadian packers are expected 
to apply.  Imported canned products will be assessed with the same classification standards applied to 
Canadian domestic products.  The manual does not differentiate between the typ es of metals (aluminium and alloy) used in 
container manufacturing as it is Cana da’s position that the types of de fects found in containers made 
from these different types of materials are simila r.  Therefore, inspection protocols and testing 
methods are the same. 
 The double Seam Measurement Standards for Two and Three-Piece Sanitary Cans are based on 
Industry Standards or specific container manufact urer guidelines when available (and provided the 
container manufacturer guidelines/standards clearly demonstrate they will not jeopardize food safety). 
 
If there are specific international container integrit y standards and testing methods which China feels 
are more relevant for aluminium versus alloy cont ainers, we would be pleased to review and comment 
on them with respect to whether or not they meet  Canadian standards concerning container integrity 
as it relates to food safety.  [China Question 12] 
 
Question:   According to Canadian Food and Drug Act a nd Regulations, use of caffeine is restricted in 
coke drinks.  It is claimed that such regulations are based on the assumption that caffeine is harmful to 
children’s health.  In 2003, Health Canada appraised  the effect of caffeine to children, but did not 
reach a final conclusion.
5 
 Question 12(a):   Please explain the necessity of the above restriction. 
 
                                                     
 
5 Source:  the official website of the EC. WT/TPR/M/179/Add.1 
Page 200  
 
ANSWER:   Under the Canadian Food and Drug Regulations , caffeine and caffeine citrate are 
considered to be food additives.  Canada utili zes a positive list process for the approval of food 
additives, which is based on submissions receive d from applicants.  Through the use of a Food 
Additive Submission, prepared in accordance with data requirements outlined in Section B.16.002 of 
Division 16 of the Food and Drug Regulations , applicants can request the use of a specific food 
additive in a particular food or food commodity to  achieve a specified purpose.  Currently, Table VIII 
of Division 16 of the Food and Drug Regulations only permits the addition of caffeine and caffeine 
citrate to "cola-type beverages" up to a maxi mum level of use of 200 parts per million (ppm) 
(calculated as caffeine).  
Health Canada has received Food Additive Submissions  to extend the use of caffeine to other food 
products.  However, caffeine is a pharmacologically  active substance, the excessive consumption of 
which has been associated with a dverse health effects.  Following consultations with a number of 
medical associations, consumer groups, regulat ory agencies, government agencies and health 
professionals, Health Canada undertook a major revi ew and assessment of the scientific literature on 
the safety of caffeine, paying particular atten tion to the effects of caffeine on vulnerable sub-
populations, especially women of child-bearing age a nd children.  This review, which was published 
in 2003, concluded that, for the healthy adult popul ation, moderate daily caffeine intake at a dose 
level up to 400 milligrams per day was not associated with adverse health effects.  However, it was 
also determined that reproductive-aged women and children were more “at risk” from caffeine 
exposure and it recommended that these women shoul d not consume in excess of 300 milligrams per 
day of caffeine and children shoul d consume no more than 2.5 millig rams per kilogram body weight 
per day.  Further details can be  found in the published review: 
 Nawrot, P., Jordan, S., Eastwood, J., Rotstein, J., Hugenholtz, A. and Feeley, M.  2003.  Effects of 
caffeine on human health, Food Additives and Contaminants  20 (1), 1-30. 
 
On the basis of this review, Health Canada conclu ded that there was a continuing need for strategies 
to mitigate risks associated with caffeine exposure.  While regulation is still considered to be an 
important part of an effective risk management stra tegy for caffeine, it is also recognized that there 
are various natural sources of caffeine that must be considered as well.  For this reason, a broader risk 
management strategy for caffeine in foods is curren tly under review in Canada.  Initial elements of 
this strategy include consumer-ori ented documents on Health Canada’s  own web site on the subject of 
caffeine:  
It’s Your Health - Caffeine  
http://www.hc-sc.gc.ca/iyh-vsv/food-aliment/caffeine_e.html 
Fact Sheet Caffeine and Your Health  
http://www.hc-sc.gc.ca/fn-an/securit/f acts-faits/caf/caffeine_e.html 
 Question 12(b):   Please explain the consistency of this restriction with WTO/SPS Agreement. 
 ANSWER:   As has been demonstrated in the response to  the previous question, Health Canada’s risk 
analysis activities (risk assessment, risk management  and risk communication) in relation to caffeine 
have been undertaken with the goal to protect huma n life or health.  This is consistent with the 
provisions of the WTO Agreement on the Application of  Sanitary and Phytosanit ary Measures.  In the 
assessment of the effects of caffeine on human h ealth, Health Canada has taken into account all 
available scientific evidence and, in  the interests of transparency, has published the results of its 
review.  The publication is identifie d on Health Canada’s website (Ref. Fact Sheet Caffeine and Your 
Health ), which is accessible to the public. 
  WT/TPR/M/179/Add.1 
 Page 201 
 
 
[Thailand Question 2] 
 
Question on page 50, Table III.7:   Table III.7 of the Secretariat Report indicates that in the years 
2005 and 2006 Canada undertook 7 a nd 4 emergency measures respectively.  Table III.7 also 
indicates that 4 of the 7 emergency measures taken in 2005 and 1 of the 4 emergency measures taken 
in 2006 were identical to or based on internationa l standards, suggesting th at for both 2005 and 2006 
Canada applied 3 standards not in conformity  with or based on international standards. 
 Please specify the products against which these non-c onforming standards were applied, and describe 
any relevant SPS import requirements and risk assessments, including the duration of such 
assessments. 
 ANSWER:   The number of emergency measures cited in the Secretariat’s report in Table III.7 does 
not correspond to Canada’s records or to those found on the WTO DocsOnline database.  Canada will 
follow up with the WTO Secretariat to clarify their methodology. 
 
In 2005, Canada issued the following notifications of emergency measures: 
 
Document Code Subject of Notification  Relevant International Standard(s) 
G/SPS/N/CAN/249 Avian products and by -products from France OIE Terr estrial Animal Health Code 
Chapter 2.7.13 
G/SPS/N/CAN/157/Rev.7, 8, 9, 10 Phytophthora ramoru m ISPM 4, 5, 10 (liste d in web link provided 
in notification) 
G/SPS/N/CAN/233/Rev.1 Puccinia horiana, P.Henn. N/A 
G/SPS/N/CAN/250 Avian products a nd by-products from the UK 
(except Northern Ireland) OIE Terrestrial Animal Health Code 
Chapter 2.7.13 
 
In 2006, Canada issued the following notifications of emergency measures: 
 
Document Code Subject of Notification  Relevant International Standard(s) 
G/SPS/N/CAN/157/Rev. 11, 12, 13, 14, 
15, 16, 17 Phytophthora ramorum ISPM 4, 5, 10 (listed in web link provided 
in notification) 
 
The only emergency measure enacted by Canada in 2005-2006 that was not based on an international 
standard was G/SPS/N/CAN/233/Rev.1 (Phytosanitary Measures for Chrysanthemum , 
Dendranthema , and Leucanthemella serotina  Plant Material to Prevent the Introduction of 
Chrysanthemum White Rust, Puccinia horiana , P. Henn.).  Despite the fact that no international 
standard existed for this plant pest, its introduction  to Canada could lead to serious losses.  The 
disease can spread rapidly throughout a greenhou se causing complete crop failure. Intensive 
management and continuous control measures are required where the disease is present.  There is 
evidence that chrysanthemum white rust develops to lerance to certain pestic ides used to control the 
disease.  The introduction of the disease could al so result in the loss of export markets for 
chrysanthemums to certain areas such  as non-infested states of the United States.  The decision to 
regulate products that could carry this pest was based on a science-b ased risk assessment.  
Information on affected products can be found a t: http://www.inspection.gc.ca/ english/plaveg/ 
protect/dir/d-97-05e.shtml. 
 
Canada would not characterize a measure that is no t strictly based on an international standard as 
“non-conforming”, as there are instances where no rele vant international standard exists or where a 
country must determine its appropriate level of pr otection based on the results of a scientific risk 
assessment. 
 WT/TPR/M/179/Add.1 
Page 202  
 
(3) MEASURES DIRECTLY AFFECTING EXPORTS 
 (ii) Export taxes  [Argentina Question 2] 
 
Question 2 (a):   Could Canada provide more details about  how the export duty system for softwood 
works? 
 
ANSWER:   The Canada Revenue Agency is responsible for administering the export charge system 
as provided for in the Softwood Lumber Products Export Charge Act, 2006 . 
 
• Normally, exporters will pay an export charge when lumber prices are at or below US$355 
per thousand board feet. 
• Canadian regions can select one of the following two export charge regimes (see chart 
below): 
• Option A (BC Coast, BC Interior, Alberta): an e xport charge with the charge varying with 
price;  or 
• Option B (Saskatchewan, Manitoba, Ontario,  Quebec): an export charge plus volume 
restraint, where both the rate and volume restraint vary with the price. 
• Under current lumber prices, the border measu res are (i) a 15% export charge under Option 
A, or (ii) a 5% export charge plus volume rest raints equal to 30% of U.S. consumption under 
Option B. 
• The Atlantic Provinces, the Territories, a nd 32 companies who were found by the U.S. 
Department of Commerce not to be subsid ized are excluded from the export charge. 
• Independent lumber remanufacturers do not pay an export charge on the value-added 
component of their products. 
• High-value softwood lumber products valued at  more than US$500 per thousand board feet 
are charged as if their value were no more than US$500 per thousand board feet. 
• Additional information on the 2006 Softwood  Lumber Agreement is available at: 
www.softwoodlumber.gc.ca. 
 
Prevailing Monthly 
Price Option A – Export Charge (Expressed 
as a % of Export Price) Option B – Export Charge (Expressed as a % of Export 
Price) with Volume Restraint 
Over $US 355 No Export Charge No Export Charge and no volume restraint 
$US 336-355 5% 2.5% Export Charge + maximum volume that can be exported 
to the United States cannot exceed the Region’s share of 34% of Expected U.S. Consumption for the month 
$US 316-335 10% 3% Export Charge + maximum volume that can be exported to 
the United States cannot exceed the Region’s share of 32% of 
Expected U.S. Consumption for the month 
$US 315 or under 15% 5% Export Charge + maximum volume that can be exported to 
the United States cannot exceed the Region’s share of 30% of 
Expected U.S. Consumption for the month 
 
Question 2 (b):  Could Canada indicate if this system appli es to all softwood exports or only to those 
going to the United States?  
ANSWER:  The border measures under the 2006 Soft wood Lumber Agreement apply only to 
softwood lumber products exported to the United States.  Question 2 (c):  Also, how does Canada return the expor t duties to the provinces from which the 
wood originated?  What method does Canada use to establish where the wood comes from?  
ANSWER:   As provided for in the Softwood Lumber Products Export Charge Act, 2006 , the 
revenues from the collection of the export charge, mi nus costs incurred in the administration of the  WT/TPR/M/179/Add.1 
 Page 203 
 
 
Softwood Lumber Agreement and costs incurred in re lation to any litigation, including damages, will 
be distributed to the provinces by the Minister of  National Revenue.  The Government of Canada is 
currently consulting extensively with the provinces in order to finalize the details of the process. 
 Under the Softwood Lumber Agreement, the "Region of Origin" of the softwood lumber product that 
is being exported determines the border measure provis ions that apply to that export.  The Region of 
Origin is the Region where the softwood lumber product was first produced, regardless of whether it 
is further processed elsewhere.  For exports of softwood lumber products to the United States, 
Canadian exporters are required to report the Region of Origin of their exports to the Government of 
Canada when filing their tax returns for the expor t charge and applying for export permits.  The 
Government of Canada has established audit pr ocesses to ensure that companies report this 
information accurately.  
(iv) Export finance, insurance and guarantees 
 
[Argentina Question 8]  
Question on Paragraph 162, page 75:   Could Canada tell us what measures have been taken to 
comply with the DSB?  ANSWER:   Following the decision of the Dispute Settle ment Body (DSB), all of EDC’s financing 
transactions, both Canada Account and Corporate A ccount, have been structured to comply with 
Canada’s WTO obligations.  Transactions are either  structured on market terms with appropriate 
benchmarks or are structured in conformity with th e interest rate provisions of the OECD Consensus. 
 
(vi) Other measures affecting exports 
 
[Argentina Question 9] 
 
Question on paragraph 176, page 79:  Could Canada provide more in formation about the “relief 
measures [that] address specific import-export scenarios”?  
ANSWER:  Canada is preparing a written response to this question which will be provided later.  
 
(4) MEASURES AFFECTING PRODUCTION AND TRADE 
 (i) Legal framework for business 
 
[Argentina Question 10]  
Question on Paragraph 190, Page 83:   Could Canada explain the na ture of the “tax treaties” 
mentioned here, and what prerequisites must be met by businesses that wish to avail themselves of the 
provisions of these treaties?  What criteria are used to determine the amount of the reduction and the 
rate applied?  Are data available concerning how ma ny treaties of this type have been established 
during the review period?  ANSWER:   Canada’s tax treaties play an important role in facilitating international trade and 
investment by providing taxpayers with more equitabl e and certain tax results in respect of their cross-
border dealings in both key and developing market s abroad.  Today there are over 80 bilateral tax 
treaties in force in Canada.  The on-going process of updating and expanding Ca nada’s network of tax 
treaties will continue to improve cooperation between tax authorities, diminish the risk of double 
taxation, and remove other obstacles to trade and investment.  WT/TPR/M/179/Add.1 
Page 204  
 
In order to qualify for the benefits under Canada’s ta x treaties, a person must be considered a resident 
of a contracting state for the purposes of the relevant treaty.  To be a resident of a contracting state, a person must be “liable to tax” in that state by virtue  of a criterion referred to in Canada’s tax treaties.  
Bilateral income tax treaties eliminate tax barriers to trade and investment.  They do so by:   
• Providing greater certainty to taxpayers regardi ng their potential liability to tax in the foreign 
jurisdiction; 
 
• Allocating taxing rights between the two jurisdictions so that the taxpayer is not subject to 
double taxation; 
 
• Reducing the risk of excessive taxation that may arise because of high withholding taxes; and,  
 
• Ensuring that taxpayers will not be subject to discriminatory taxation in the foreign 
jurisdiction. 
 Tax treaties provide benefits to both taxpayers an d governments by setting out clear rules that will 
govern tax matters relating to cro ss-border trade and investment.  Fo r instance, treaties provide that 
the business profits from the cross-border activities of a resident of one country will be subject to 
taxation in the other treaty country only if there is  a minimum level of economic activity that takes 
place within that other country.  Tax treaties also allocate taxing rights between the two countries as a 
means of protecting taxpayers from potential double ta xation.  This allocation takes several forms.  
First, treaties generally include a mechanism for resolving the issue of residence in the case of a 
taxpayer that otherwise would be considered to be a resident of both countries. Second, with respect 
to each category of income, the treaty assigns the "pri mary" right to tax to one country, usually (but 
not always) the country in which the income arises (the "source" country), and the "residual" right to tax to the other country, usually (but not always) the country of residence of the taxpayer.  Third, the 
treaty provides rules for determining which country will be treated as the source country for each category of income.  Finally, the treaty provides rules limiting the amount of tax that the source 
country can impose on each category of income and establishes the obligation of the residence 
country to eliminate double taxation that otherwise w ould arise from the exercise of concurrent taxing 
jurisdiction by the two countries.  For example, in  most countries, payments to non-resident persons 
of certain passive forms of income such as divide nds, interest and royalties are subject to withholding 
tax at substantially high rates imposed on the gross amount paid.  Tax treaties alleviate such taxation 
by setting maximum levels for the withholding tax that the treaty partners may impose on these types 
of income or by providing for exclusive reside nce-country taxation of such income through the 
complete elimination of source-country withholding tax.  
(ii) Incentives and other assistance to business 
 [Argentina Question 3] 
 
Question on paragraphs 193-194 (pp. 83-84 in Sp anish version, 66-67 in English version) and 
paragraphs 199-200 (pp. 85-86 Spanish version, page 68 in English version): 
 
Could Canada provide a comprehensive up-to-date lis t by year of the payments, tax breaks, special 
tariffs and credit facilities being given to agricultu ral, agri-food and industr ial production (including 
the treatment for new technologies)?  Could Canada include in this information specific data broken 
down for federal and provincial policies?  ANSWER:  Please refer to Canada's latest subsidy notifi cation for this information.  The most recent 
version is WTO document G/SCM/N/123/CAN, 1 August 2005. 
  WT/TPR/M/179/Add.1 
 Page 205 
 
 
Norway Comments on WTO Secretariat Report - pp.66-70  As a general comment the TPR Report 
by the WTO-Secretariat provides a good overview and insight to the Canadian subsidy regime. However, Norway seeks further clarification on the questions below:  General comment:  The following questions from Norway frequently use the word "subsidy".  As 
Norway is aware, this is a term that has a spec ific definition under the WTO.  As such, whether 
payments made by the Government of Canada are or  are not subsidies is determined by a process of 
applying criteria found in the WTO ASCM, such as "fin ancial contribution" and "benefit", to financial 
payments by a government.  This principle is rein forced by Article 25.7 of the ASCM that addresses 
the status of programs notified in subsidy notifica tions.  Article 25.7 says that,  "Members recognize 
that notification of a measure does not prejudge either its legal status under GATT 1994 and this 
Agreement, the effects under this Agreemen t, or the nature of the measure itself." 
 Canada agrees with the view expressed in Article 25.7 and responds to Norway's questions with the 
understanding that our answers do not prejudge either the legal status of the measures referred to in 
our answers, under GATT 1994 and the ASCM or their effects, if any. 
 
[Norway Question 1] 
 
Question:  Could Canada clarify the legal basis for its general federal assistance programmes that are 
briefly described in section 193 of the TPR?  Does Ca nada have any permanent subsidy legislation, or 
does subsidy legislation vary according to annual prio rities in Federal State Budgets?  If the latter is 
the case, is this legislation renewe d or amended on an annual basis? 
 ANSWER:   The legal basis for any federal assistan ce programme described in section 193 of the 
TPR would be found in the Act of Parliament that applies to the applicable Ministry that operates the 
program in question.  For example, the Department of Industry Act specifies the powers, duties and 
functions of the Minister of Industry.  The term s and conditions for each fe deral program operated by 
the Department of Industry would specify the aut hority under the Department of Industry Act for the 
program. Legislation for other departments, e.g., th e Department of Finance, would similarly specify 
the powers, duties and functions of the Minister of Finance for programs that are concerned with 
taxation.  The Acts governing the ope rations of all departments of th e Government of Canada can be 
found at the following website http://laws.jus tice.gc.ca/en> http://laws.justice.gc.ca/en. 
 Canada does not have "permanent " programs regarding assistance per se.  The spending plans of the 
Government, including monies allocated to assistance  programs, are outlined in the "Main Estimates", 
which delineate the total expenditures of the Gove rnment and individual departments and agencies. 
Canada's Parliament considers the information in cluded in the Main Estimates when voting on the 
annual Budget and appropriations bills put before Parliament.  The Main Estimates, along with the 
Minister of Finance's Budget, reflect the G overnment's annual budget planning and resource 
allocation priorities and these can change direction each year.  
[Norway Question 2] 
 Question:  Does Canada maintain any subsidy schemes that provide investment aid as direct grants to 
investment projects, as opposed to the subsidy sch emes based on tax measures as described in the 
TPR?  
ANSWER:   Canada's financial management policies fo r federal departments provide for the payment 
of grants.  The payments of grants made pursuant to specific program legislation, are authorized by Canada's Parliament through an Appropriation Act by the words "the grants listed in the Estimates" in 
the vote wording of the program concerned.  This wording extends the legislative authority of the 
Appropriation Act to the grants that are listed in the transfer payment tables of the Estimates where 
potential recipients and the maximum amount that ma y be paid are identified.  Grants can not be WT/TPR/M/179/Add.1 
Page 206  
 
increased or redirected to other recipients without the authority of Parliament.  Specific examples of grants can be found in the departmental performan ce reports for each department at the following 
website:  <http://www.tbs-sct.gc.ca/est-pre/estime. asp> http://www.tbs-sct.gc.ca/est-pre/estime.asp 
 
[Norway Question 3] 
 Question:  Could Canada clarify the relationship between  Federal and Provincial assistance schemes? 
Are there any rules on cumulation of aid from Federa l and Provincial subsidy schemes?  Is there any 
kind of national surveillance or national control over the total amount of subsidies available to 
industry and its legal basis? 
 
ANSWER:   Canada's financial management policies fo r federal departments require departments to 
obtain information from a potential recipient about other sources of proposed funding for a project, either through information on application forms or other suitable means, prior to approving a 
contribution in excess of $100,000 or providing a grant in excess of $100,000. 
 
For grants and contributions in excess of $100,000, the department should ensure that the amount of 
the grant or contribution it makes is appropriate where a project is anticipated to receive a grant and/or 
a contribution from more than one program in a depa rtment, from more than one department or more 
than one level of government, i.e., a province.  E ach department must take into account the other 
sources of funds (which includes private sector c ontributions), including the expectation that the 
recipient must contribute its own funds towards the eligible cost of the project.  Provision for 
repayment must be included in funding agreements c overing grants or contribut ions to cover instances 
where more funding is provided from federal, pr ovincial and municipal sources than was anticipated. 
Further, specific limits on the total amount of government assistance, must be considered by 
departments in developing and pr oposing Terms and Cond itions for grant and contribution programs. 
 
(iii) Government Procurement 
 Competitive bidding 
 
[Costa Rica Question 14] 
 Question on Paragraph 219:  What implications are involved in the review of contracts over 
Cdn$2 million for regional and industria l benefits?  Is the review c onducted prior to the contracting 
process, or as a stage in that process? 
 
ANSWER:  The Procurement Review Policy is published by the Treasury Board Secretariat at:  
http://publiservice.tbs-sct.gc.ca/pubs_po l/dcgpubs/tbm_122/pr1_e .asp#_Toc443896449. 
 Further information regarding how such benefits ar e addressed in procurement is set out in the section 
of the policy titled “Policy Requirements”.  In par ticular, as noted in paragraph 9 of this section: 
“…the objectives and the evaluation criteria for contr actor selection must be clearly spelled out in the 
request for proposals, and industry must be made aw are of those objectives as early in the process as 
possible. … Consultations must be carried out in a manner that ensures that all potential suppliers are 
treated fairly and equitably.”  Benefits are not sought when procurement is subject to Canada’s 
commitments under the WTO Agreement on Govern ment Procurement or NAFTA Chapter 10. 
 
[Costa Rica Question 15] 
 
Question on Paragraphs 222 and 223:   What is the difference in procedures between the advance 
contract award notice and non-competitive contracting? 
  WT/TPR/M/179/Add.1 
 Page 207 
 
 
ANSWER:  The federal government encourages the u se of Advance Contract Award Notices 
(ACANs) as a procurement tool that supports competition by allowing the contracting authority to determine if, in fact, there are other interested companies in the marketplace.  Following the posting 
of an ACAN on the government electronic tendering serv ice, all companies may submit a statement of 
capabilities for the procurement.  If the statemen t of capabilities is accepted by the contracting 
authority, then a full open competition is conducte d for the requirement, otherwise, the contracting 
authority will proceed with a contract under the applicable limited tendering provisions.  In circumstances where Canada’s commitments  under the WTO Agreement on Government 
Procurement, NAFTA Chapter 10 or the Agreement on Internal Trade apply, the ACAN clearly shows the applicable limited tendering reason as set  out in these agreements.  In the case of non-
competitive contracting, an ACAN is not posted on the government electronic tendering service.  In 
general, ACANs are not used where valid statemen ts of capabilities cannot be accepted, for example 
in cases of national security or extreme urgency. 
 
[Singapore Question 2]  
 
Question:   Could Canada elaborate on procedures used by its provincial governments for conduct of 
their procurements?  Are there any central directiv es or guidelines issued by the Federal or Provincial 
Government for Canada's provincial entities to comply with? 
 
ANSWER:  Each province and territory is fully respons ible for its own procurement policies and 
practices.  Each province and territory maintains a web site that includes information on the structure 
and organization of that province or territory.  These websites may be accessed from the following site:   http://www.canada.gc.ca/othergov/prov_e.html.  [Korea Question 4]  Government Procurement at the sub-federal level  
 
Question on pp.70~76 para.210~230:  Canada is a member of the WTO government procurement 
agreement. The Canadian government, however, has not yet opened its sub-central government 
procurement market despite its commitmen t to do so no later than July 1997. 
 Most Canadian provinces have introduced discrim inatory procurement policies, such as price 
preferences that favor suppliers located within the province.  Ac cording to Article 3 of the WTO 
government procurement agreement, a member s hould grant national treatment to other member 
countries.  The Korean government is concerned that the aforementioned policy of the Canadian 
government does not coincide with the rules of the WTO.  
 Korea hopes that the Canadian government will immediately open its sub-central government 
procurement market and encourage its provinces to eliminate their discriminatory procurement 
policies.  What is the Canadian government's position on this?  
 
ANSWER:  Canada did not make a commitm ent to open its market for sub-federal procurement.  
Mutually acceptable commitments were not nego tiated with other Parties in the eighteen-month 
period between April 1994 and October 1995.  As a result, Canada did not confirm any specific 
commitments and does not have any commi tments for sub-federal procurement. 
 
Article III of the WTO Agreement on Government pr ocurement applies to procurement covered by 
the Agreement.  Since Canada does not have any commitments for sub-federa l procurement, Canada 
has no obligation to provide national treatment to other countries with respect to its sub-federal 
procurement.  WT/TPR/M/179/Add.1 
Page 208  
 
Although not obligated to open procurement to fore ign suppliers, Canada’s provinces and territories 
generally have open and transparent procurement prac tices.  Procurement of sufficient size to be of 
interest to foreign suppliers is advertised public ly, generally using electronic tendering.  Although 
benefits are not commonly sought, an y conditions or domestic benefits that are sought are described 
in the notice or bid documents.  No province or te rritory has a broad-based small business set aside or 
price preference program of general applicability. 
 
(iv) State-trading, state-owned companies, and privatization 
 [Singapore Question 3] 
 Question:  Canada has enterprises belonging to the Federal and Provincial Governments. 
 (a) What are the differences between these two types of enterprises?  
(b) In this connection, could Canada  provide a sample list of it’s enterprises? 
 (c) What are differences in the  relationship be tween the two type enterprises and the relevant 
governments, especially in the area of procurement?  In addition, could Canada provide information on its   crown corporations and companies with shared 
governance structures. 
 (d) What is the difference between these types of organizations?  To what extent are the Canadian 
federal or provincial governments involved in these enterprises?  
ANSWER:  The Constitution Act of 1867 prescribes the divisi on of federal and provincial powers.  
To assist with fulfilling some of their respective areas of responsibility, federal, provincial and 
territorial governments of Canada have created Cr own corporations.  Federal Crown corporations are 
created by the federal government.  Provincial or territorial Crown corporations are created by a 
provincial or territorial government.  
Table AIII:7 of the Secretariat Report includes a list of crown corporations.  The 2006 President’s 
Annual Report to Parliament - Crown Corpor ations and Other Corporate Interests of Canada  
provides more information for each of these Crown corporations.  The Report may be accessed on line 
at: http://www.tbs-sct.gc.ca/report/CROWN/06/cs-se_e.asp. 
 
Each province and territory maintains a web site  that includes information on the structure and 
organization of that province or territory.  These websites may be accessed from the following site:  
http://www.canada.gc.ca/othergov/prov_e.html.  
[Turkey Question 3] 
 
Question on State-Owned Enterprises, Para 232:  Secretariat Report mentions that Canada has 
around 100 state-owned enterprises while it has been noted that no information was available on sub-
federal ones. 
 
Question (a):   Does Canada have a plan to privatize state owned enterprises? 
 
Question (b):  Are there any analysis to measure the im pact of state-owned enterprises on Canadian 
economy?  ANSWER:  Decisions to privatize are made on a case-by-case basis by the government owners.  
Therefore, it is not possible to predict whether or when privatization may occur.  Methods of  WT/TPR/M/179/Add.1 
 Page 209 
 
 
privatization and the terms woul d be determined by the government concerned and would be 
consistent with any commitments under international treaties.  (v) competition policy and regulatory issues  [Hong Kong, China Question 3] 
 
Question on P. 79, Para. 246:   It is stated in the Secretariat Report that the Canadian Competition 
Bureau is "examining tools that could be used to develop legislation with a view to limiting 
government intervention through the least intrusive m eans possible".  Grateful if Canada can provide 
more information about these tools.  ANSWER:  Working Party #2 of the OECD’s Competition Committee has developed a toolkit to 
include a competition assessment in regulatory impact analysis (RIAs).  The Competition Bureau is in 
the process of testing the OECD model, which will be  on various projects with in Industry Canada as 
part of the Bureau's competition advocacy work.  The toolkit will enable policy analysts to ask hard 
questions as to whether proposed laws and policies are narrowly defined to interfere minimally with 
the marketplace and to identify options that are the least intrusive on competition.  For more 
information on this, please see the following link of a speech given by the Commissioner of 
Competition on November 6
th, 2006: (< http://www.competitionbureau.gc.ca/internet/index.cfm?item 
ID=2227&lg=e> ). 
 
Part IV – TRADE POLICIES BY SECTOR  
(2) AGRICULTURE 
 [China Question 13]  State-trading Enterprises  
Question:   CWB is a state-owned enterprise which, under authorization of the government, is 
exclusively engaged in the export of wheat and barl ey in western areas.  All export credit of the CWB 
is guaranteed by the federal government via va rious programs.  Canada does not accord same 
treatment for domestic and imported corn.  For example, CWB enjoys preferential treatment on railroad transportation charges. 
 
Please explain the conformity of the above  policies with relevant WTO rules. 
 
ANSWER:  To date, there has been no WTO agreemen t on rules governing the extension of export 
credit or export credit guarantees.  Most CWB sales are on a cash basis and the Credit Grain Sales Program (CGSP), which can be used to guarant ee amounts owing to the Canadian Wheat Board 
(CWB) from sovereign buyers, has not been used fo r new credit sales since the 2001/02 crop year.  A 
small percentage of CWB sales make use of cr edit guarantees offered under the Agri-Food Credit 
Facility.  The CWB does not enjoy preferential treatment on railroad transportation charges.  
[China Question 14] 
 
Fishery 
 
Question:   The shares held by foreigners in compani es with Canadian commercial fishing license is 
restricted to 49%. 
 
Please explain the reasons for the above restriction. 
 WT/TPR/M/179/Add.1 
Page 210  
 
ANSWER:   Canada maintains certain controls associat ed with foreign participation in Canada's 
fisheries sector.  These conditions reflect, for example, coast-state rights under international law relating to jurisdiction over territorial  waters and exclusive economic zone. 
 [Korea Question 8]  Supply Management 
 
Question:   Canada protects supply-mana ged products, which cover dair y products, poultry and eggs, 
by imposing a tariff rate that is over 200  percent on the goods which exceed the quota.  
 
As the WTO DDA resumed, the Canadian government  emphasized the need to abolish all kinds of 
export subsidies in the field of agricultura l goods, reduce domestic subsidies which distort 
international trade, and improve the real  and substantial level of market access.  
 
Canada has international competitive power in the ag ricultural field and is cl assified as an agricultural 
exporter.  With this status in mind, is it still necessary to maintain the Supply Management System? 
 
ANSWER:   Supply management is a system that ensures a stable supply of dairy, poultry and eggs 
for Canadian consumers and the agri-food industry.  It  also promotes stable farm incomes.  The basic 
idea behind supply management is to ensure th at domestic demand is met, while ensuring a 
reasonable return for producers and stable prices fo r consumers.  The supply management system has 
served Canada well for several years.  Canada has no plans to put time limits on the future of these 
schemes.  Like for other WTO Members, Canada’s support to some of its most sensitive sectors does 
not diminish our interest in an overall ambitious outcome for the Doha Round. 
 
[Korea Question 9] 
 
Canadian Wheat Board  
Question on p.76 para.231, p.87 para.3, pp.96~98 para.47~54:  Canada is reviewing a staged 
elimination of the monopoly of the Canadian Wheat Board, which has the monopolistic right of sales for export and for domestic human consumption of  wheat and barley produced in Western Canada.  
 
What is the Canadian government’s view on the po sition of the Canadian Wheat Board with regards 
to monopolizing the market and how does it plan to improve the situation?  Furthermore, are there 
similar reviews related to the state-trading enterp rises, such the Canadian Dairy Commission, that 
have been notified to the WTO? 
 
ANSWER:  A commitment was made during the 2006 federal election campaign to give western 
Canadian wheat and barley producers the option of  participating voluntarily in the Canadian Wheat 
Board (CWB).  At the same time, the Government  is committed to supporting the supply management 
system.  The Government’s policy direction with respect to both the CWB’s marketing mandate and 
supply management is driven by domestic consid erations.  This is cons istent with Canada’s 
longstanding policy that decisions regarding the fu ture of the both the CWB and supply management 
should be made in Canada and not by Ca nada’s internationa l trading partners. 
 
There are no similar reviews related to state-tr ading enterprises, such as the Canadian Dairy 
Commission, that have been notified to the WTO.  [Thailand Question 3]  
Question 3(a) on page 88, para 11:   The Secretariat Report mentions  that in June 2002 the federal, 
provincial, and territorial governments of Canada  signed the Framework Agreement on Agricultural  WT/TPR/M/179/Add.1 
 Page 211 
 
 
and Agri-Food Policy for the Twenty-First Centur y (Agricultural Policy Framework:  APF) to 
enhance the agri-food sector’s profitability.  The Government Report (Page 21, para 106) also 
indicates that the APF was implemented to position Canada as the world leader in food safety and 
quality as well as responsible agricultural producti on, but does not provide details on the APF. 
 
Please explain the following APF categories in detail: 
 a) Business risk management  b) Food safety and food quality  c) Science and innovation   d) Environment 
 e) Renewal 
 
ANSWER:  
Business Risk Management  – The objective of the Business Risk Management component is to 
improve risk management by compensating producers for dramatic income loss due to disaster, and 
providing risk management funding.  Food Safety and Quality  – The objective of the Food Safety and Quality component is to enhance 
national, integrated agriculture and agri-f ood safety and quality policies and programs. 
 Science and Innovation  – The objective of the Science and Innovation component is to realign 
current research with the major elements of the A PF for food safety, the environment and adaptation 
to other challenges of the 21
st century. 
 
Environment  – The objective of various initiatives by the federal and provincial governments under 
the environmental component of the APF is to enhance the sector’s environmental performance 
through the development of agri-environmental farm plans and accelerated adoption of sound 
environmental policies that will help achieve measu rable and meaningful environmental goals in the 
areas of water, air and soil quality, and bio-diversity. 
 
Renewal  – The objective of the Renewal component is  to help farmers have access to advisory 
services, training, skills, knowledge, and tools to help them make well-informed management 
decisions and to succeed in farming. 
 
Question 3 (b) :  Please also provide examples of programs and services under each APF category.  
 
ANSWER:  
Business Risk Management - Canadian Agricultural Income Stabilization (CAIS) Program, 
Production Insurance, Farm Improvement and Marketing Cooperatives Loans Act (FIMCLA), 
Advance Payments Program (APP), Price Pooling Program (PPP), Spring Credit Advance Program 
(SCAP), and Private Sector Risk Management Partnerships (PSRMP).   
 
Food Safety and Quality  – Canadian Food Safety and Qualit y Program (CFSQP), National Animal 
Tracking and Tracing System, New Brunswick Ag ri-Food Safety Initiative, and Nova Scotia 
Regulatory Compliance Food and Farm Safety  Science and Innovation  – Agri-Innovation Program, Broker Program 
 
Environment  – National Environmental Farm Planning , Greencover Canada, Agri-Environmental 
Standards, National Agricultural Environmental He alth and Reporting Progr am (NAHARP), National 
Farm Stewardship Program, Nati onal Land and Water Information Service (NLWIS), Information 
Gaps in Water Quality and Nutrients (GAPS) Program, National Water S upply Expansion Program, WT/TPR/M/179/Add.1 
Page 212  
 
Pesticide Risk Reduction (PRR)  Program, Environmental Technology Assessment for Agriculture (ETAA), Environment Certification, and Water Quality Surveillance.  
Renewal – Canadian Farm Business Advi sory Services, Canadian Agri cultural Skills Services, Skills 
and Learning Initiative, and Provincial Development Initiatives. 
 
Additional information can be found in Ca nada’s domestic suppor t notification for 
2006(G/AG/N/CAN/64) and also at:  http://www.ag r.gc.ca/index_e.php?s1= info&s2=t&page=apf-
csa. 
 
Question 3 (c):   In addition, both Reports mention that most of the APF agreements will expire in 
2008, and that Canada has been holdi ng consultations with stakeholders  on how to transform the APF.  
Please describe any intended changes to the APF. 
 
ANSWER:  Agriculture and Agri-Food Canada (AAFC) , along with provincial and territorial 
governments, are working with stakeholders to deve lop the next generation of agriculture and agri-
food policy.  Through a multi-phased, national c onsultations process, Canadians now have the 
opportunity to provide input and a dvice on how to best ensure a competitive and profitable agriculture 
sector in years to come.  This input will be consider ed as part of the federal, provincial, and territorial 
governments’ deliberation leading to implemen tation of policies and programs.  As these 
consultations are still underway and Federal-Provincial-Territorial (FPT)  deliberations have not been 
completed, changes to the current APF are not yet known.  [Thailand Question 4]  
Question 4 (a) on page 90, para 14:   The Secretariat Report describes certain elements of Canada’s 
OECD Producer Support Estimate (PSE). 
 
What is the ratio of government payment to pr oducers compared with government price support? 
 
ANSWER:  
i) Data on the composition of Producer Support Estimates (PSE) makes it possible to distinguish between market price support and budgetary paymen ts.  Based on the OECD data for 2005, market 
price support accounts for 45% of producer support in Canada, while budgetary transfers account for 
the remaining 55%.  ii) The budgetary support includes government direct  payment to producers and additional forms of 
public support to the sector which benefit directly to producers although they are not paid directly to 
producers.  For example, government expenditures for extension services, interest free loan advances 
and crop insurance premiums are examples of public  expenditures which are not paid directly to 
producers.  
Question 4 (b):  Please also explain how Canada calculates its PSE of payments based on historical 
entitlements and farm income.  
ANSWER: 
 
i) The OECD has established the methodology for PSE calculations, and it produces the calculations 
for Canada, as for other OECD countries.  The PSE methodology is available publicly on the OECD 
website at:  http://www.oecd.o rg/dataoecd/36/47/1937457.pdf. 
 ii) The PSE categories are defined according to how a policy measure is implemented in terms of the 
basis for granting support (implementation criteria).   WT/TPR/M/179/Add.1 
 Page 213 
 
 
iii) The “payments based on historical entitlements” re fer to payments that are based on historical area 
or historical animal numbers or hi storical level of production of a specific agricultural commodity or a 
specific group of agricultural commodities.  For th ese payments, there is no obligation to plant or 
produce such commodities in the y ear where the payment is made. 
 
a. An example of support based on historical en titlements in Canada is the per head payments 
($/head) for animals on farms at a specific date in the past e.g. the number of eligible ruminants 
(cattle, sheep, at December 23, 2003.  This example applies to the Direct Payment  component of each 
of the following programs: the Transitional Industr y Support Program and the Farm Income Payment 
Program. 
 
iv) Payments based on overall farming income incl ude payments to compensate producers for farm 
income drops in a given stabilization year, relative to previous years or to a reference period, and 
payments to ensure a minimum income guarantee for farmers.  
a. Examples of payments based on overa ll farming income in Canada include: 
  i. Payments under the Canadian Agricultural Income Stabilization (CAIS) program: such payments are based on individual farms’ progr am margin.  The program margin (overall farming 
income) is determined by the difference between the sales of commodities produced on a farm minus 
all the eligible expenses.  The CAIS payments for each stabilization year are triggered when the 
program margin for an individual farm falls belo w the reference margin level (“Olympic average”: 
average for three years out of previous five year s, excluding the years with the highest and lowest 
margins).   ii Payments under the General Payment  component of each of the following programs: 
the Transitional Industry Support Program and the Fa rm Income Payment Program.  These payments 
were based on the average eligible net sales (incom e) for the 1998-2002 reference years to which a 
ratio was applied (e.g., 3.5% of eligible net sales).  Included in the eligible net sales are the sales of all 
commodities, except the supply-managed commod ities (milk, poultry and eggs) minus eligible 
expenses, as reported in individual tax records.   [Thailand Question 5]  
Question on page 91, paras 19-20:   The Secretariat Report indicates that Canada grants preferential 
access under its free trade agreements  to the same WTO in-quota volumes rather than establishing 
additional tariff quotas for those products.  In add ition, some preferential access under Canada’s WTO 
TRQ commitment varies from year to year since its share is defined by a share of domestic 
production. Please clarify this preferential access in light of MFN considerations.  
 
ANSWER:  According to Canada’s Schedule, in-quota  imports include imports from all countries 
except in the case of beef and v eal, where Canada does not count imports from the U.S., and Mexico.  
The count of imports within a tariff quota is consistent with the count of imports used to calculate the 
size of the tariff quota.  Canada’s practice is consistent with its WTO obligations. 
 
[Thailand Question 6] 
 
Question on  page 91, para 20:   The Secretariat Report states: “Canada’s preferential trade 
agreements establish tariff quotas with in-quota volumes defined as a share of domestic production in 
a base year, rather than in ab solute terms as is the case under Canada’s WTO commitments.”  
  6 (a)  What are the differences between th e PTA figures versus the WTO figures? 
 
 6 (b)  Please also indicate how the PTA and WTO tariff quotas are each calculated. WT/TPR/M/179/Add.1 
Page 214  
 
ANSWER to Questions 6(a) and 6(b):   Canada has 4 Tariff Rate Quotas (TRQs) for which the 
access levels are further defined in NAFTA.  The NAFTA TRQs are expressed as a share of domestic production in a base year, while WTO figures are expressed in absolute terms, as indicated in Canada’s WTO Schedule.  The levels of in-quota volumes under NAFTA vary from year to year, and 
may be lower or higher than the levels  specified in Canada's WTO commitments. 
 
The 4 TRQs are outlined in the table below along w ith their calculation method.  To illustrate these 
calculations, access levels for 2005 (as notified to the WTO) are shown in the table.  
TRQ PRODUCT  IMPORT ACCESS LEVELS  2005 NAFTA 
ACCESS LEVEL 2005 WTO 
ACCESS LEVEL 
Turkey & Turkey Products 5,588.83 tonnes (WTO) or 3.5% of anticipated 
current year production (NAFTA) 5,203 tonnes 5,588 tonnes 
Chicken & Chicken Products 39,843.7 tonnes (WTO) or 7.5% of previous year 
production (NAFTA) 72,538.1 tonnes 39,843.7 tonnes 
Eggs & egg products 21.37 milli on dozens (WTO) or 2.988% of 
previous year production (NAFTA) 15,150,325 dozen 21,370,000 dozen 
Broiler hatching eggs and 
chicks 7,949 million dozens (WTO) or 21.1% of 
anticipated current year production (NAFTA) 11,699,716 dozen 7,949,000 dozen 
 
[Thailand Question 7] 
 
Question 7 (a) on page 92, para 25:   Please describe the requirements for quality, labeling, 
packaging, health and safety, and any other such  requirements as defined in the Fresh Fruit and 
Vegetables Regulations. 
 
ANSWER:   The quality requirements for the products Ca nada regulates are prescribed in Grades and 
Standards contained in Schedule I, Part I and II of  the Fresh Fruit and Vegetable Regulations.  The 
quality requirements prescribe minimum (and or ma ximum) allowable limits for maturity, size 
(diameter or weight), shape, and colour require ments.  The quality requirements also establish 
tolerances for defects (e.g., hail damage, bruisi ng, russeting, skin breaks, insect damage, and 
freezing). 
 Canada has grades and standards for 30 commodities; they are:  apples, apricots, blueberries, 
cantaloupes, cherries, crabapples, cranberries, grapes , peaches, pears, plums and prunes, field rhubarb, 
strawberries, asparagus (green), b eets, Brussels sprouts, cabbage, carrots, cauliflower, celery, sweet 
corn, field and greenhouse cucumbers, head lettuce, onions, parsnips, potatoes, rutabagas, and field 
and greenhouse tomatoes.  The grades and standa rds are mandatory.  All products traded  
interprovincially or in import trade are required to  meet the requirements prescribed by the Fresh Fruit 
and Vegetable Regulations.  In the case of appl es, onions, and potatoes, Canada requires these 
products be certified as meeting requirements (usually  performed at the Canadian port of entry or at 
another inspection point as authorized by an inspector).  
As it relates to packaging and labelling, no person shall package produce in a container that bears a 
label that misrepresents the quality, quantity, compositi on, nature, safety, value, origin or variety of 
the contents.  Canada maintains fe deral legislation estab lishing standards related to the declaration of 
net quantity, grade name, country of origin, common  name of the product, responsible party.  The 
Fresh Fruit and Vegetable Regulations also establis h an upper container limit of 200 kg for apples and 
50 kgs for all other commodities.  Standard c ontainer requirements for pre-packaged product 
(normally sold to the consumer) are established for beets, carrots, onions, parsnips, potatoes and 
rutabagas. 
 
As it relates to health and safety, no person shall ma rket produce in import, export or inter-provincial 
trade as food unless it is not adulterated, not contamin ated, is edible, free of live insects injurious to  WT/TPR/M/179/Add.1 
 Page 215 
 
 
human health, prepared in a sanitary manner, and which meets all other requirements of Canada's 
Food and Drugs Act and Regulations .  Canada samples domestic a nd international products for 
compliance with chemical residue limits prescribed by the Food and Drugs Regulations and monitors 
for microbiological contaminants. 
 Question 7 (b):   Please also indicate whether there are any different requirements for importing fruit 
and vegetables from tropical countries. 
 
ANSWER:   This will be based on the country’s disease or pest status, and if import conditions are 
presently in place.  The current import requirements can be found in the CFIA’s on-line database at:  
http://airs-sari.inspection.gc.ca/ airs/airs_decisions.asp?l=E. 
 
[Thailand Question 8] 
 
Question 8 (a) on  page 93, para 30:   How and when are Canada’s price support mechanisms for 
milk and milk products applied?  
ANSWER:   The Commission annually reviews and establishes support prices for butter and skim 
milk powder for the year to come.  Support pri ces are the prices at which the Canadian Dairy 
Commission (CDC) purchases and sells butter and sk im milk powder within its domestic seasonality 
programs. These programs allow the CDC to buy and se ll these products in surplus or shortage period. 
 
Each year, the CDC, in collaboration with the pr ovinces, undertakes a national study of the cost of 
producing milk at the farm. In the fall, the CDC al so holds consultations on milk prices with the 
following segments of the industry;  dairy producers,  processors, further processors, restaurateurs and 
consumers. CDC Commissioners then make a de cision on the support prices which is announced in 
mid-December and becomes effective on February 1st of the following year. 
 
The CDC Commissioners base support prices on the following elements: results of the cost of 
production study, arguments presented by various stakeholders, an evaluation of the processors’ 
margin, economic indicators such as the consumer price index as well as their own experience and 
knowledge of the industry. 
 
Question 8 (b):   How is the milk production quotas (Mar ket Sharing Quota) in each province 
allocated?  ANSWER:   The Market Sharing Quota (MSQ) is the national milk production target for industrial 
milk in Canada.  The Canadian Dairy Commissi on makes a recommendation to the Canadian Milk 
Supply Management Committee (CMSMC) on the MSQ.  This target is constantly monitored and is 
adjusted when necessary to reflect  changes in demand, as measured in terms of butterfat, during the 
course of the year.  The National Milk Marketing Plan establishes each pr ovince’s share of the MSQ, and provides for the 
sharing of any quota increase or decrease.  The prov ince’s share of the MSQ is historically based and 
increase or decrease according to a formula that is weighted 90% on population and 10% on historical 
share.  Each province allocates it s respective share of th e MSQ to its producers according to its own 
policies.  
[Thailand Question 9] 
 
Question on page 93, Para 33:   Please clarify in detail how pr ovincial poultry producer boards and 
processors negotiate prices for poultry b ased on a cost of production formula. 
 WT/TPR/M/179/Add.1 
Page 216  
 
ANSWER:   The Government of Canada and the nati onal supply management agencies have no role 
in poultry pricing.  Farm prices for live poultry are set on a basis negotiated between provincial poultry producer boards and provinc ial primary processors which take costs of production into 
account.  
Typically the cost of production formula for chic ken is based on the sum of three elements:  the 
observed cost of chicks, the observed cost of f eed and a negotiated producer margin.  The observed 
prices are updated for each production period, while  producer margin negotiations occur annually. 
 
[Thailand Question 10] 
 Question on page 94, paras 34-36:   Please provide more details on the Canadian Agricultural 
Income Stabilization Programme (CAIS). 
 
 10 (a)  In particular, how are participation fees de termined in relation to producer coverage? 
 
 10 (b)  How has the method for this determination changed compared to pre-2006 fees (22% 
 for participants with maximum coverage)? 
 
ANSWER to Question 10 (a) and 10 (b):   In 2006, the requirement for a deposit was eliminated and 
replaced by a fee.  Previously, producers had to set asi de 22% of the value of th eir reference margin in 
a CAIS account to have full protection under the pr ogram.  For example, a producer with a $100,000 
reference margin who selected full coverage would be required to have a deposit of $22,000, for 85% 
coverage the deposit required woul d have been $14,500, and for 70% coverage it would have been 
$14,000.  Upon triggeri ng a payment, these deposits woul d be returned to producers. 
 
Now producers will pay 0.45% or $4.50 per $1000 of Reference Margin sel ected.  This fee is 
approximately equal to the net interest cost to  producers of making these deposits at financial 
institutions. Upon triggering a payment, these fees would not be returned.  
[Thailand Question 11] 
 Question on page 94, para 37:   We appreciate the Secretariat Report’s description of payments 
under the CAIS programme’s tier system in paragr aphs 37, and believe that including a graphical 
explanation or summary chart would also be useful .  If such a chart is already available, we would 
appreciate it if Canada could either  provide it or direct us to it. 
 
ANSWER: 
  WT/TPR/M/179/Add.1 
 Page 217 
 
 
50% 
70% 
80% 
60% 0% 70% 85% Margin Decline Government Payment Producer Responsibility 
92%  
Negative 
Margins
Original Deposit for full coverage 
– Current fee based on net interest - Maximum Payment with 100% 
Margin Decline (WTO 70% of loss 
constrain)CAIS Program 
 
 
[Thailand Question 12] 
 
Question on page 95, para 40:  Please provide more details about  the government guarantee Price 
Pooling Program and the Farm Improvement a nd Marketing Cooperatives Loans Act (FIMCLA). 
 
ANSWER:   The Farm Improvement and Marketing C ooperatives Loans Act (FIMCLA) program is 
designed to increase the availability of loans fo r improvement and development of farms and the 
processing, distribution or marketing of fa rm products by co-operative associations. 
 Further information on the program can be found  at:  http://www.agr.gc.ca/index_e.php?s1=prog 
&s2=fimcla. 
 
The Price Pooling Program provides a price guarant ee that protects marketing agencies and producers 
against unanticipated declines in th e market price of their products.  Program participants use the 
price guarantee as security in obtaining credit fro m lending institutions.  This credit allows the 
marketing agency to improve cash flow of pr oducers through an initial payment for products 
delivered.  It also provides equal returns to producer s for products of like grades, varieties and types. 
 
Further information on the program can be found  at:  http://www.agr.gc.ca/index_e.php?s1=prog 
&s2=ppp.  
[Thailand Question 13] 
 
Question 13 (a) on page 97, para 50:   Please provide more details on the delivery contracts that 
CWB establishes with farmers to coordinate the delivery of CWB grain into the handling system, 
including the various market conditions that have been or may be taken into consideration when 
establishing such contracts. 
 
ANSWER:   Copies of the CWB’s delivery contracts are publicly available on the CWB website at:  
www.cwb.ca.  A delivery contracts is a binding agreement between the CWB and an individual grain producer.  The grain producer submits a contract specifying the type, grain and quantity of grain which he or she wishes to deliver.  The CWB then assesses the amount of grain offered under all contracts, evaluates market conditions, and then  announces the level that it will accept.  The 
evaluation of market conditions would include assessing the supply/d emand situation in the major 
exporting countries, in the major import markets and on the world market as a whole.  It would also WT/TPR/M/179/Add.1 
Page 218  
 
include an evaluation of pricing c onditions in cash and futures markets,  and of the differentials being 
paid for grain meeting particular quality specificati ons or, in the case of wheat, for particular classes 
and protein levels.  Once the CWB has accepted the grain, it may issue de livery calls at any time during the crop year.  
Producers delivering to the CWB under a delivery contr act receive initial, interim and final payments 
under the pooling system, unless they have opted for one of the other payment options offered by the 
CWB. 
 
Question 13 (b):   In addition, which market conditions  would warrant CWB’s deferral of export 
sales? 
 
ANSWER:   The CWB has been set up as a commercial business entity to market Western Canadian 
wheat and barley on behalf of Western Canadian pr oducers.  Like any other commodity trader, the 
CWB must make decisions on the timing and pric ing of sales based on market conditions.  The 
Western Canadian wheat and barley crops cannot be sold all at once but must be brought to market 
over the course of the crop year giving due attention to expected price movements and also the need 
to obtain an optimal return, minimize adverse pr ice movements, meet customer requirements for 
inventory and respect the limitations imposed by the capacity of the transportation and handling system.  All of these factors affect the timing of the CWB’s export sales. 
 
Question 13 (c):   Finally, when does the CWB limit the amount of grain to be accepted for delivery, 
and why/how is this dependent on sales?  
 
ANSWER:   As a rational commercial actor, the CWB te nds to limit the amount of grain it accepts if 
it appears that producers might otherwise deliver more  grain than the market could reasonably absorb.  
This is consistent with the object of the CWB as c ontained in the Canadian Wheat Board Act, that is, 
marketing in an orderly manner, in interprovi ncial and export trade, grain grown in Canada. 
 
[Thailand Question 14] 
 
Question on page 98, para 51:   The Secretariat Report notes that CWB proceeds from grain sales are 
deposited into one of four “pool” accounts for each gr ain category.  It further notes that Government 
direct financial transfers may occur when the pool accounts register a deficit.  Under what circumstances have such transfers occurred in the past, or if they have not occurred, under what 
circumstances might they take place? 
 
ANSWER:   Financial transfers occurred where there was a deficit in one of the pool accounts.  This 
means that the average amount received (per tonne) from the sale of grain in particular pool account was less than the initial payment plus marketing costs.   Pool account deficits ha ve been rare and have 
been the result of extraordinarily negative developm ents in market conditions during a pooling period. 
 
[Argentina Question 11] 
 
Question on Paragraph 1, page 109:   Has Canada considered cha nging the support it furnishes to 
agri-food products?   ANSWER:   Canada only provides support to its supply  managed sector through tariff quotas and high 
over quota tariffs.  As the supply management system requires predictability in import levels, there is 
a need for higher over-quota tariffs for supply mana ged commodities. Canada is not considering any 
changes to the supply management system. 
  WT/TPR/M/179/Add.1 
 Page 219 
 
 
[Argentina Question 12] 
 
Question on paragraph 2, page 109:   Could Canada state whether there is any project under way 
with the aim of eliminating or reducing assistance for the products listed here, or reducing the high 
tariff rates applied to them?  
 
ANSWER:   Supply management is a system that ensures a stable supply of dairy, poultry and eggs 
for Canadian consumers and the agri-food industry.  It  also promotes stable farm incomes.  The basic 
idea behind supply management is to ensure th at domestic demand is met, while ensuring a 
reasonable return for producers and stable prices fo r consumers.  The supply management system has 
served Canada well for several years.  Canada has no plans to put time limits on the future of these 
schemes.  
[Argentina Question 13] 
 Question on paragraph 3, page 109:   Could Canada specify which are the two Member Countries 
referred to?  What was the “mutually agreed solution”?  
 
ANSWER:  The two Member Countries include the United States and New Zealand.  The mutually 
agreed solution can be found in documents WT/DS113/33 and WT/DS103/33, dated 15 May 2003. 
 
[Pakistan Question 3]  
Question:   Pronounced tariff escalations among semi -processed and fully processed agricultural 
products have an adverse impact on investment in food processing sectors in developing countries.  
 
Does Canada intend to adjust these tariff escalations  in order to encourage value-added exports from 
developing countries? 
 
ANSWER:   Canada is a strong supporter of an ambiti ous outcome to the Doha negotiations.  Canada 
outlined a proposed approach to address tariff esc alation in WTO documen t Job(06)/166 which was 
distributed to all Members in June 2006.  With in the context of the Doha negotiations, Canada 
continues to support an ambitious tiered formula as well as an additional modality to reduce or 
eliminate any tariff escalation that may remain after the application of that formula.  Canada supports 
addressing tariff escalation broadly within the Doha negotiations to encourage trade in value-added 
products.  [Pakistan Question 4] 
 
Question:   As per Canadian law, the importers of fr esh fruit and vegetables mu st be licensed by the 
Canadian Food Inspection Agency, which delays the export of developing countries executed by new importers in Canada.  
Is there any plan to provide some Special and Di fferential Treatment to developing countries in this 
regard?  ANSWER:   Canada has not received any requests for sp ecial and differential treatment with regards 
to these requirements.  Canada is pleased to consid er all requests for special and differential treatment 
on a case-by-case basis, taking into account the special  development, financial and trade needs of the 
developing country making the request.  WT/TPR/M/179/Add.1 
Page 220  
 
[United States Question 1] 
 
Agriculture Sector- Border and Related Measures 
 
Question 1:  Referencing paragraph 16 on page 90 of the Secretariat report on Canadian agricultural 
quotas, we understand Canada opera tes programs that allow for imports outside the TRQ system 
contingent on the products, once they ar e used in processing, being exported. 
 Does Canada maintain separate data on which products are imported under these systems and where the products are exported?  If so, is the data pub licly available and how can  members access such 
data? 
 ANSWER:   Canada publishes separate import data fo r imports under Canada's  Import for re-export 
program (IREP).  The program allows for imports at the within-access rate of duty provided that the 
imported product is used in the processing of a prod uct that is subsequently exported.  This import 
data is published on an aggregate basis in Canada 's ariff Rate Quota Utilization Tables posted on the 
Department of Foreign Affairs and International Trade's website.  These Tariff Rate Quota Utilization 
Tables are updated on a weekly basis.  The UR L for the relevant section of the website is 
http://www.dfait-maeci.gc.ca/eicb/menu-en.asp.  The sp ecific details can be found in the "agriculture" 
section of the website. Information on the levels  of supplemental permits issued under the IREP 
programme can be found in the various columns of the reports entitled "To Export".  Canada does not 
maintain separate data on where the products are exported. 
 
[United States Question 2] 
 Agriculture Sector- Domestic Programs 
 Question 2:   In paragraph 30 on page 93, the Secretaria t report indicates that every two months the 
Canadian Milk Supply Management Committee (CMS MC) sets an industrial milk production target 
for Canada, known as Market Sharing Quota and that  each province allocates its share of the Market 
Sharing Quota to producers according to its own po licies.  It is our understanding that after the 
decision rendered by the Dairy Panel in December of 2003, a group of non-quota dairy producers in 
Ontario argued that they were not subject to th e WTO ruling since the ruling was not explicit as to 
whether or not it applied to non-quota producers.  Due to these types of pressures, we have been made 
to understand that there have been discussions at the federal and provincial levels to develop a new 
export program that would allow for a type of “dua l marketing” system, one for export and one for the 
domestic market. 
 
Could Canada please provide some information on  how such a system could be developed and 
administered in a way that would avoid cross-subsidization?  ANSWER:   The Government of Canada has been involved with the provinces in conducting a 
strategic review of the repercussions of the WTO Canada - Dairy cases on Canadian dairy exports and 
their long term implications with re gard to Canada’s participation in  the dairy export market.  This 
work is still ongoing.  
[United States Question 3] 
 Question 3:   In paragraph 31, page 93, the Secretaria t Report notes that Provincial marketing boards 
and agencies set the price at which they pu rchase milk from producers and sell it to domestic 
processors; prices are set in accordance with the end use. 
  Question 3 (a):   We note that when Canada notifies product specific support in dairy, the 
 support is based only on the administered prices for butter and skim milk powder.  Is Canada  WT/TPR/M/179/Add.1 
 Page 221 
 
 
 able to demonstrate that there is no price suppor t effect to other dairy products in Canada's 
 milk pricing system beyond these two administered price supports?  If there is in fact a price  support effect on other dairy pr oducts, would a broader produc tion base be more appropriate 
 to use in the notification? 
 
ANSWER:   Market price support for dairy consists of two separate calculations for the only two 
products to which an administered price applies (support price):  butter and skim milk powder. 
 
Question 3 (b):   Does Canada maintain a price support mechanism for fluid milk? 
 ANSWER:   No. 
 
[United States Question 4] 
 Question:  Paragraph 33, page 93 of the Secretariat report states that Canadian producer prices for 
poultry are negotiated between provi ncial poultry producer boards and processors based on a cost of 
production formula, and for eggs, each  provincial egg board sets the price that grading stations pay to 
producers.  
Question 4 (a):   Are these fixed prices such that processors and grading stations are required to pay 
this fixed, minimum price?    ANSWER:   The prices are minimum gross prices to be paid by the processor or grader.  However the 
processor or grader nets levies payable to the marketing boards and then pays the producer a net price.  
Question 4 (b):   Is there any allowance for another price to be paid?  
 
ANSWER:   In the case of chicken there are up to six different minimum prices for live chicken each 
applicable to a different weight category.  Also in  the case of chicken, processors in some provinces 
pay producers a premium above the applicable category price when cer tain specified conditions are all 
met.  In the case of table eggs, prices paid by the grader to the producer vary by grade (i.e. size and 
quality).  
[Argentina Question 4] 
 
Question 4 (a) on paragraph 1, page 31 and paragraphs 3, page 109 and 47 to 52, pages 122/123:  
Paragraph 1 mentioned above says that in the pe riod under review, no changes occurred in Crown 
corporations, including the Canadian Wheat Board.  Nevertheless, as mentione d in paragraphs 3 and 
49, a working group created by the Minister of Agriculture and Agri-Food published a report in October 2006 recommending the gradual elimination of the Board’s monopoly.  Could Canada report 
on whether it has decided to transform the Canadi an Wheat Board according to the report of the 
working group? 
 ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
 Question 4 (b):   Also, could Canada provide more details on export credit programs, in particular the 
credit service for agricultural and agri-food prod ucts, the terms and conditions for advances, the 
percentage guaranteed by the government, repaymen t periods, interest rates and risk premiums? 
 ANSWER:  Canada is preparing a written response to this question which w ill be provided later. 
 WT/TPR/M/179/Add.1 
Page 222  
 
[Argentina Question 5] 
 
Internal Assistance Programs 
 
Question on paragraph 38, page 119:   Could Canada provide deta iled information on measures 
being taken to replace the Canadian Agricu ltural Income Stabilization (CAIS) Program? 
 
ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
 
[Argentina Question 6] 
 
Question on paragraph 41, page 120:   Concerning direct payments and general payments made in 
2006 under the Grains and Oilseeds Payments Program (GOPP), could you specify the reason for adopting 2000–2004 as the base period?  Also, coul d you say if there is a maximum amount per 
producer for both direct and general payments?  Finally, could you indicate what types of service are 
covered by general payments? 
 ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
 
(3) MINING AND ENERGY 
 
[Argentina Question 14] 
 
Question on Paragraph 4, page 87:   Canada is a major producer and exporter of minerals and 
energy.  Mining and energy have attracted substa ntial investment during the period under review, in 
large part due to increased commodity prices.  Th e industry, both at the mining and processing levels 
has benefited from fiscal incentives offered both by federal and provincial governments.  In several 
provinces and territories, tax incentives are availa ble only for processing minerals originating in 
mines located within the respective province or territory.  Mining in Canada is subject to government 
approval, which in some cases may be linked to th e use of local labour, goods, and services.  Foreign 
investment restrictions remain in uranium mining.  Provincial governments play a predominant role in 
the electricity sector.  In most provinces, provincial crown corporations provide most of the 
generation, transmission, and distribution of ener gy, while in some, retail and wholesale competition 
has been introduced.  Could Canada provide more information about the nature of the fiscal incen tives?  Are these subject 
to production and/or export targets? 
 
ANSWER:   No direct tax incentives are specifically targ eted at mining production.  In general terms, 
since the late 1980's, it has been a general tax polic y of the federal government to eliminate sector-
specific tax incentives in favour of lower corporate tax rates.  At the present time, the only tax incentives offered to mining are in support of exploration.  
What is referred to here as provincial incentives fo r processing minerals is the 'processing allowance'.  
The 'processing allowance' was not designed as an in centive to do more processing, but as one of the 
several deductions from the proceeds from sales that have to be taken in or der to establish the proper 
basis for the mining tax.  Canada, unlike most other countries, computes its mining tax on the basis of a notional mine-mouth profit, as opposed to proceeds from sales.  Once a mineral product leaves a 
province, it triggers a transaction point upon whic h a 'processing allowance' is computed, based on the 
amount of processing carried out within the province.  In Canada, mining is undertaken by the private sector not the Government.  All mining projects in Canada are subjected to environmental reviews and approval process to ensure that any negative 
impacts of mining on the environment are mitigated and/or minimized.  The environmental reviews  WT/TPR/M/179/Add.1 
 Page 223 
 
 
and approval process also ensures that a reclamation plan has been developed and that the company in 
question has the resources to undertake the planne d work at the end of life of the mine.  The 
environmental reviews and approval process does not  stipulate the use of local labour, goods or 
services.  
Impact Benefit Agreements normally include commitm ents by the mine operator to use local labour, 
goods and services.  These are contractual agreements  between a private sector company that seeks to 
operate on traditional Aboriginal territory, and the lo cal Aboriginal communities.  The exact nature of 
these agreements between the company and th e community are private and confidential. 
 
The current restrictions on uranium mining, whic h exclude exploration activities, require resident 
ownership levels of individual pr oduction projects of at least 51%, unless it can be clearly established 
that the project is in fact Canadian-controlled.  Fu rthermore, this restriction may lifted if it can be 
demonstrated clearly that Canadian partners cannot be found.  It should be noted that there is no direct 
Government of Canada owners hip of uranium exploration or mining assets in Canada. 
 
[Argentina Question 16] 
 
Question on Paragraph 71, page 129:   Provisions are contained in the Canada-Nova Scotia Offshore 
Petroleum Resources Accord Implementation Act, and the Canada-Newfoundland Atlantic Accord 
Implementation Act, whereby first consideration must be given to services provided, and goods 
manufactured within the respective provinces, as long as such goods and services are competitive in 
terms of fair market price, quality, and delivery.   According to the authorities, in Newfoundland and 
Labrador, consideration is given to employment and the purchase of local goods and services, in the 
approval process for petroleum projec ts.  In Nova Scotia, petroleu m exploration right-holders in 
acquiring goods and services relating to the exercise of their rights are required to make all reasonable 
attempts to use local labour, goods, and serv ices.  In addition, the federal and most 
provincial/territorial governments have implemen ted tax incentives to support manufacturing and 
processing that may be of benefit to companies ope rating in the mining and energy sectors.  These 
tend to take the form of either corporate income  tax credits on manufacturing and processing profits, 
or tax credits for investments related to manufacturing and processing.  In most provinces and territories, tax incentives are available only for pr ocessing minerals originating in mines located 
within the respective province or territory. 
 Are there any further requirements or prerequis ites for accessing the tax incentives?  What is the 
magnitude of these incentives?  
ANSWER:   At the federal level, there subsists an inv estment tax credit of 10% of the capital cost of 
qualified property (essentially, machinery and e quipment used for manufacturing and processing) 
operated within the Atlantic provinces and the Gaspe peninsula in the province of Quebec.  This tax 
credit is not specific to mining or mineral processing.  
(4) MANUFACTURING 
 
[Argentina Question 7]  (i) Aviation Sector  
Question on Paragraph 81, (page 131 Spa nish version, 103-4 English version):   Could Canada 
describe the support package, now temporarily inte rrupted, that was planned for Bombardier to 
develop production of airc raft for 130–150 passengers? 
 ANSWER:   The government of Canada has confirmed it would honour the commitment to contribute 
up to $350 million in assistance to the development of the CSeries, subject to re-payment.  This WT/TPR/M/179/Add.1 
Page 224  
 
support is conditional on Bombardier meeting certain  conditions including the formal launch of the 
CSeries program.  Bombardier has yet to launch the CSeries project.  When the company does so, and 
when it fulfils its conditions, the go vernment will honour its commitment. 
 
[Argentina Question 15] 
 
Question on Paragraph 5, page 87:   Could Canada provide more details with respect to the 
incentives referred to in this paragraph?  Is ther e a fixed period during which these incentives apply?  
Are these incentives in conformity with WTO rul es?  Have they been notified to the WTO? 
 ANSWER:  
Aerospace:  was administered through Technology Partnerships Canada (TPC) http://tpc-ptc.ic.gc.ca/ 
Automotive:  was administered through Tec hnology Partnerships Canada (TPC) http://tpc-
ptc.ic.gc.ca/Shipbuilding:  http://strategis.ic. gc.ca/epic/site/sim-cnm i.nsf/en/uv00003e.html. 
 
Textiles:  http://strategis.ic.gc.ca/ epic/internet/inctp-ptc.nsf/en/Home. 
 NOTE:   TPC's terms and conditions e xpired on December 31, 2006.  All existing obligations made 
by TPC before December 31, 2006 will be honoured.  The government continu es to consider options 
on how to best support industrial R&D in Canada. 
 
For transparency reasons, Canada has notified th ese programs to the WTO.  In designing industrial 
assistance programs, Canada takes full account of its WTO obligations.  
[Argentina Question 17] 
 
(i) Aircraft 
 
Question on paragraph 82, page 132:   Could Canada enumerate th e steps taken to improve the 
competitiveness of the industry, as re ferred to in this paragraph? 
 
ANSWER:   The Canadian Aerospace Partnership is a pr ivate and public sector initiative.  It provides 
the forum for industry stakeholders to discuss issues facing the Canadian aerospace and defence 
industry.  Recommendations and discussion papers pr oduced by CAP provide are just one of many 
inputs considered by the government for the pur poses of developing policies and programs.  CAP 
recommendations are not binding on the Government.  More information on CAP can be found on the 
following website http://www.cap -pca.ca/english/index.asp. 
 
[Argentina Question 18] 
 
Question on Paragraph 83, page 132:   Could Canada specify whethe r there exist specific conditions 
for accessing the different types of government assist ance?  If so, what are these conditions?  Canada 
is preparing a written response to this ques tion which will be provided at a later date. 
 
[Argentina Question 19] 
 (iii) Shipbuilding 
 Question on paragraph 91, page 134:   Does Canada intend to cons olidate the tariffs mentioned 
here?  ANSWER:   Canada will review its Tariff in accordan ce with the outcomes of the DDA negotiations. 
  WT/TPR/M/179/Add.1 
 Page 225 
 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 4] 
 
Question on paragraph 89 of page 105:   It is noted that a number of tariff remission schemes 
pertaining to imports of textiles and clothing are in  operation.  The Canadian General Preferential 
Tariff (GPT) Programme, for example, accords preferential and differential treatment to Members of the WTO.  As we understand it, such products from a Least-Developed Country (LDC) can enjoy 
tariff-free preference when entering Canada if they are made from yarn or fabric from a GPT 
beneficiary.  
Because we have not been granted designated be neficiary status under the GPT programme, while 
other WTO Members such as Korea and Hong Kong that  are at a similar stage of development to 
ourselves are accorded such preferential treat ment, our exports to LDCs are affected. 
 
We have some serious concerns in this respect .  In its Report “European Communities - Conditions 
for the Granting of Tariff Preferences to Developi ng Countries”, the Appellate Body concluded that 
“...the term ‘non-discriminatory’…does not pr ohibit developed-country Members from granting 
different tariffs to products originating in differe nt GSP beneficiaries, ...” and “In granting such 
differential tariff treatment, however, preference-granti ng countries are required, by virtue of the term 
‘non-discriminatory’, to ensure that identical treat ment is available to all similarly-situated GSP 
beneficiaries, that is, to all GSP beneficiaries that have the ‘development, financial and trade needs’ to 
which the treatment in question is intended to respond (emphasis added, see paragraph 173 of 
WT/DS246/AB/R).”  
In light of the above, we respectfully request that Canada grant us designate d beneficiary status under 
the GPT programme, in due recognition of the principle of non-discrimination.  
ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
 
(5) TELECOMMUNICATION AND BROADCASTING SERVICES 
 [China Question 15] 
 Question:   Please describe the development of Canadian telecommunication market, including, inter 
alia, the major carriers and their market shares. 
 
ANSWER:   Please see the Canadian Radio-television and Telecommunications Commission (CRTC) 
monitoring report, the Status of Competition in Canadian Telecommunication Markets for a detailed 
analysis of the development of telecommunication markets in Canada. 
 http://www.crtc.gc.ca/ENG/publications/re ports/PolicyMonitoring/2006/tmr2006.pdf  
 WT/TPR/M/179/Add.1 
Page 226  
 
[China Question 16]  
 
Question:   Please describe the current situation of fore ign investment in Canadian telecommunication 
industry, including, inter alia, the number of foreign service providers and their market shares and business scope. 
 
ANSWER:   Canada's Telecommunications Act requires that telecommunications common carriers be 
Canadian controlled and limits direct investment to 20% of the voting shares.  The limit on the voting 
shares for holding companies is 33 and 1/3%.  Th e maximum investment by foreign entities in an 
operating company is 46.7% (i.e. 20% of the operating company and 26.7% of the holding company 
(33 and 1/3% of the remaining 80%)).  Such carri ers must be controlled in fact by Canadians. 
 Foreign owned and controlled service providers ma y provide telecommunication services in Canada 
on a resale basis.  There are 749 resellers registered  with the CRTC, 70 of which are registered as 
foreign operators.  [China Question 17] 
 
Question:   Please describe the application procedures for a foreign service provider to enter Canadian 
telecommunication market and list the documents needed.  Are there any procedures relating to internet and information security?  If yes, please briefly describe them.  
ANSWER:   A foreign owned and controlled service provi der that wishes to resell telecommunication 
services in Canada must register with the CRTC as a reseller.  A company may register by sending a letter of intent to the CRTC or by applying online.  For more information on registering as a reseller 
of telecommunication services in Canada, pleas e see:  http://www.crtc.gc.ca/eng/INFO_SHT/ 
t1017.htm. 
 
[China Question 18] 
 
Question:   What are the main laws and regulations  regulating the telecommunication market in 
Canada?  
ANSWER:   The main laws for telecommunications in Canada are the Telecommunications Act, the 
Radiocommunication Act, and the Canadian Te lecommunications Common Carrier Ownership and 
Control Regulations.  
The Canadian Radio-Television and Teleco mmunications Commission (CRTC) regulates 
telecommunication services in Canada.  Please see www.crtc.gc.ca for information on Canadian regulations on telecommunication services.  
[China Question 19] 
 Question:   Canadian Telecommunications Law  stipulates that in enterprises engaged in the business 
of transmitting equipment, shares directly held by  a foreign investor shall not exceed 20%;  shares 
indirectly held by a foreign investor shall not exceed 33%; total share under effective control of foreign investors shall not exceed 46.7%.   
Please explain the reasons for the above restrictions. 
 ANSWER:  Canada maintains limitations on fo reign investment in facilities-based 
telecommunication common carriers to ensure our na tional sovereignty, security and economic, social 
and cultural wellbeing. 
  WT/TPR/M/179/Add.1 
 Page 227 
 
 
[Costa Rica Question 6] 
 
Question:   How many companies are currently providing telecommunications services in Canada? 
 ANSWER:   The Canadian Radio-television and Teleco mmunications Commission reported that there 
were approximately 1,100 service providers in 2005 wh ich provided a multitude of services including 
local and access, long distance, Internet and broadba nd, data and private line, and wireless services. 
 
Please see the Canadian Radio-television and Tel ecommunications Commission (CRTC) monitoring 
report, the Status of Competition in Canadian Te lecommunication Markets for a detailed analysis of 
the development of telecommunication markets in Canada. 
 http://www.crtc.gc.ca/ENG/publications/re ports/PolicyMonitoring/2006/tmr2006.pdf. 
 
[Costa Rica Question 7] 
 Question:   Is the Canadian telecommunications legislation based on the notion of convergence [poss.: 
multilateralization], or is it based on the regulation of services?  ANSWER:   The Telecommunications Act provides fo r the Canadian telecommunications policy 
objectives and for the regulation of Canadian  telecommunications common carriers.  The 
Telecommunications Act is technically neutral in a pplication and does not contemplate the content of 
the transmission.  The Broadcasting Act provides for the regulation of broadcasting services in Canada and addresses content rather than the tran smission of the service of broadcasting services for 
the purposes of nurturing Canadian culture.  [Costa Rica Question 8] 
 
Question:   What type of reforms to the legislation is  being proposed with a view to better responding 
to changes in the technological environment?  ANSWER:   Canada is not proposing to reform legi slation to better respond to changes in the 
technological environment as the Telecommunicati ons Act is technologically neutral in its 
application.  In March 2006, an independent panel of experts co mmissioned by the Government to review Canada's 
telecommunications policy and regulatory framework released its final report.  The report included 
127 recommendations to modernize Canada’s telecomm unication regime.  As an initial response, the 
Government has issued a policy direction to the telecommunications regulator, the Canadian Radio-
television and Telecommunications Commission (CRTC), to rely on market forces to the maximum extent feasible to achieve Canada’s telecomm unications policy objectives.  The Government 
continues to examine the potential benefits and impl ications of the recommendations of the report but 
no decision has been made to amend Cana da’s telecommunications legislation. 
 
[Costa Rica Question 9] 
 
Question:   Why, from June 2003 to June 2006, did Canada drop from second to ninth place amongst 
OECD countries as concerns wideband penetration rates?  Was this situation due to regulation 
problems? 
 ANSWER:   Canada has been a leader in the deployment of broadband infrastructure and many 
Canadians have taken advantage of the wide availa bility of high-speed Internet services.  In recent 
years, a number of countries have surpassed the pe netration rates seen in Canada.  However, given 
Canada’s vast geographic expanses and relatively small population, Canada continues to compare WT/TPR/M/179/Add.1 
Page 228  
 
favourably with many countries concerning access to and use of broadband services.  At the end of 2005, access to broadband services was available to 92% of Canadian house holds and nearly all 
households in urban areas.  Canada generally relies on market forces for the development of 
telecommunications but has policies in place to assist the deployment of broadband infrastructure in rural and remote regions. 
 
The CRTC regulates the provision of wholesale Intern et access services.  The underlying facilities and 
services of the Incumbent Local Exchange Carriers re quired by service providers are subject to price 
regulation and generally fall within the basket of  services under the current price cap regime.  Cable 
broadcast distribution undertakings are also require d to provide third-party Internet access to their 
underlying facilities.  The CRTC has forborne from economic regulation of low-speed and high-speed 
retail Internet access services. 
 
The Government of Canada launched the Broadba nd for Rural and Northern Development Pilot 
Program (BRAND) on September 5, 2002.  Th is $105M (CDN) program supports Canadian 
communities in the development and implementa tion of business plans for the deployment of 
broadband infrastructure with a one-time strategic cap ital investment.  A priority for this program was 
placed on communities facing geographic and socio- economic barriers to broadband access, such as 
Aboriginal, northern, rural and remote commun ities.  The BRAND program will end on March 31, 
2007.  
In October 2003, Industry Canada, in partnership wi th Infrastructure Canada and the Canadian space 
Agency launched the National Satellite Initiative.  It was created to make available affordable satellite 
capacity for the deployment of broadband services to  communities in the far to mid-north, and in 
isolated and remote areas of Ca nada, where satellite technology is the only practical connectivity 
solution.  In addition to the programs outlined a bove, in Canada, Infrastruct ure Canada coordinates 
federal government efforts focused on cities and co mmunities, and supports in frastructure initiatives 
(such as transport and communications) across the country.  The Canadian Strategic Infrastructure 
Fund (CSIF) is a $4B (CDN) fund directed to projects of major federal and regional significance in areas that are vital to sustaining economic growth and enhancing the quality of life of Canadians.  
Note that broadband projects are eligible for funding under CSIF.  [Costa Rica Question 10]  
Question:   Could you explain the substance of the univer sal service policy that is being developed in 
Canada?  
 
ANSWER:   The Telecommunications Act explicitly gives the CRTC powers to require 
telecommunications service providers to contribute to a fund to support access by Canadians to basic 
telecommunications services.  The CRTC has implemented universal service measures to help maintain basic telephone service rates a ffordable in high cost service areas. 
 The basic service objective for Local Exchange  Carriers (LECs), defined by the CRTC is: 
 
• Local individual line service, with touch-tone dialling, provided by a digital switch with 
capability to connect via low-speed data tran smission to the Internet at local rates; 
• Enhanced calling features, including access to emergency services; 
• Access to operator services and directory assistance; 
• Access to the long distance network;  and 
• A copy of the local telephone directory. 
 
The total annual funding requirements are based on th e incremental costs of providing basic telephone 
service in high-cost serving areas and are set in the context of public proceedings.  Both incumbent  WT/TPR/M/179/Add.1 
 Page 229 
 
 
and competitive LECs are eligible to receive thes e subsidies for residential basic telephone service 
lines they provide in high-cost serving areas.  In 2006, the contribution fund for subsidies to these 
high-cost serving areas was $241 million.  Funding obligations, applicable to  telecommunications servi ce providers, are based on a percentage of 
eligible revenues.  Exemptions apply to small service providers with less than $10 million in 
revenues.  Revenues from retail Internet, pagi ng and terminal equipment are excluded.  
 
[Costa Rica Question 11] 
 Question:   Could you explain the substance of the po licy measures that can be adopted to limit 
spectrum aggregation?  ANSWER:   Spectrum aggregation limits may be used to  prevent the concentration of spectrum by 
any single entity.  Such limits would typically be established in the policy and licensing framework 
for a competitive process to limit the amount of spect rum which could be acquired by a single bidder 
and its affiliates.  Canada had imposed a spectrum aggregation limit wh ich applied across a number of bands in which 
similar services such as Cellular and Personal Comm unications Services (PCS) bands were provided. 
Operators were limited to the total amount of spect rum they could acquire in all the bands in which 
high mobility services could be provided.  However, this limit was removed in  2004, due in large part 
to the opening of a number of other mobile bands and the convergence occurring with similar services 
and technologies.  Canada has also used auction specific spectrum a ggregation limits which only applied to the band 
being auctioned, and were in force for a limited time (2 years) after the auction. 
 
[Hong Kong, China Question 4] 
 
Question onWT/TPR/S/179, P. 109, Para. 107:   It is stated in the Secretariat Report that in the 
context of Canada's previous Re view, several WTO Members asked about prospects for liberalizing 
the limitations on foreign ownership and control.  According to the Canadian authorities, Canada is 
examining the potential benefits a nd implications of increasing fore ign investment in the Canadian 
telecom industry.  However, no decision to am end the existing regime has yet been made. 
 Grateful if Canada would advise on the latest progress of the examination, the current timetable for its 
completion and for the announcement of the outcomes. 
 ANSWER:   In March 2006, an independent panel of experts commissioned by the Government to 
review Canada's telecommunications  policy and regulatory framework released its final report.  The 
report included 127 recommendations to modernize Canada’s telecommunication regime, including a 
proposal to amend the restrictions on foreign direct  investment (FDI) in the sector.  The panel found 
that the economic arguments supported the liberalizati on of the investment restrictions but proposed a 
phased-approach to liberalization to address Canada’s  other policy objectives; in particular, Canada’s 
broadcasting policy.  The Government continues to assess the benefits and implications of the panel’s 
proposal.  [Hong Kong, China Question 5] 
 
Question on audiovisual services (WT/TPR/179, P. vii, Para. 1):   We note from Canada's revised 
offer that it is currently maintaining two MFN ex emptions on audiovisual services concerning film, 
video and television programming co-production. 
 WT/TPR/M/179/Add.1 
Page 230  
 
Grateful to know if the measures under the exemp tions are applied by national origin of the 
audiovisual works;  and if so, how the national origin  is applied, whether by the origin of the funding 
party, the production crew, or the place of production, etc.  ANSWER:   Official international co-productions ar e recognized as 100% Canadian content for 
purposes of access to funding programs or the broadcasting system as long as the projects meet the 
terms of the treaty.  Treaties, in general, re quire that the creative and technical portions be 
proportionate to the financial contribution.  For ex ample, if a Canadian producer is responsible for 
20% of the financing, it is expected that the Cana dian producer will have control over at least 20% of 
the creative and technical elements of the production.   Generally, shooting must take place in one of 
two signatory countries. 
 Telefilm Canada administers co-production agreem ents on the Canadian government's behalf.  To 
obtain more information on Telefilm Canada’s guidelines for co-productions, please consult the 
following website:  http://www.telefilm.gc.ca/04/41.asp.  
Official text of the Canada-Hong Kong memora ndum of Understanding creating a Co-Production 
Agreement between Canada and Hong Kong can be found at:  http://www.telefilm.gc.ca/04/43.asp. 
 
[Hong Kong, China Question 6] 
 
Question 6 a) on audiovisual services (WT/TPR/179, P. vii, Para. 1 Summary of Observations): 
As stipulated in the Annex on Article II Exemptions  to the GATS, all MFN exemptions maintained by 
Members should be reviewed from time to time, be in principle not more than 10 years in duration, 
and in any event, be subject to negotiation in subsequent trade-liberalization rounds. 
 
Grateful if Canada would advise whether it w ould consider removing the two MFN exemptions 
currently maintained by it in its future offers.  ANSWER:   The conditions creating the need for the exemptions remain: co-production meet such 
cultural policy objectives as improving the availability of Canadian audiovisual productions in Canada, promoting greater diversity among foreign audiovisual works on the Canadian market, as 
well as to promote the international exchange of audiovisual works. 
 Question 6 b):   If not, what are the reasons behind and would Canada consider clarifying the 
exemptions in terms of their scope of application and duration instead? 
 
ANSWER:   Canada's current MFN exemptions are sch eduled in a transparent manner, clearly 
indicating the type of preferential treatment accord ed, and the conditions that created the need for 
such exemptions. We do not see a need for further clarification. 
 
[The Separate Customs Territory of Taiw an, Penghu, Kinmen and Matsu Question 5] 
 
(ii) Institutional and legal framework 
 (b) Broadcasting 
 Question on paragraph 116 of page 111:   As indicated in the report, foreign ownership of 
broadcasting programming undertak ings and broadcasting distributio n undertakings is limited in 
Canada to 20% of an operating company and 33.3% of a holding company.  
As there is a sizeable population in Canada with an Asian background, the programming covering this 
market is important for us and ot hers in our region.  Therefore, we would appreciate knowing whether 
Canada plans further liberalization in this sector  to remove the above-mentioned restrictions.  WT/TPR/M/179/Add.1 
 Page 231 
 
 
ANSWER:   Under current rules, foreign ownership of broadcasting programming and distribution 
undertakings is limited in Canada to 20% of an  operating company and 33.3% of a holding company. 
This means that in the broadcasting, cable and sat ellite business, combined direct (20%) and indirect 
(33.3% X 80% = 26.7%) ownership can reach 46.7%.  There are no plans for further liberalization in 
the broadcasting sector at this time. 
 
It should be noted that the CRTC, Canada's broadc asting industry regulator, authorizes the carriage of 
a wide variety of non-Canadian programming services by cable, satellite TV and other distributors through its Revised lists of elig ible satellite services.  As of February 23, 2007, there are 68 non-
Canadian third-language programming services available for distribution in Canada. 
 
(6) FINANCIAL SERVICES 
 [China Question 20] 
 Question:   In order to invest in Canada, foreign financ ial institutions should apply to the Office of the 
Superintendent of Financial Institutions (OSFI).  Please provide the number of approvals and denials ma de by the OSFI concerning the applications by 
foreign financial institu tions since 1995 until now. 
 
ANSWER:   The Canadian federal legislative framework  for financial institutions offers Foreign 
Financial Institutions (“FFI”) a wide array of possib ilities to carry on activities in Canada.  Subject to 
certain conditions and approva l requirements, FFIs may: 
  - establish regulated bank, trust and loan, insurance, cooperative credit society, or 
  securities dealing subsidiaries 
 - establish unregulated financial service entities  - operate on a branch basis in Canada thr ough regulated foreign bank branches, foreign 
  insurance company branches, cooperativ e credit association or securities dealing 
  branches  - own or operate non-financial service businesses in Canada. 
 
From Jan 1 2003 to October 31, 2006 OSFI has either  approved, or was in the process of reviewing: 
  - 9 applications for the establishment of a foreign bank branch  - 28 applications for the establishment of a foreign insurance company branch (2 of 
  which have been voluntarily withdrawn by the applicant) 
 - 8 applications for the establishment of a foreign owned Canadian bank (1 of which 
  has been voluntarily withdrawn by the applicant)  - 8 applications for the establishment of a foreign owned Canadian insurance company 
  (1 of which has been voluntarily withdrawn by the applicant)  - 47 applications by foreign banks to carry out certain activities in Canada not 
regulated by OSFI. 
 Expressions of intent that have reached the formal ap plication stage are very rarely refused.  Canada’s 
regime does not require an appr oval for all FFI activities in Cana da.  Regarding information on 
approvals and refusals dating back to 1995, OSFI has not had the opportunity to compile statistics 
predating 2003. 
 WT/TPR/M/179/Add.1 
Page 232  
 
[Costa Rica Question 12] 
 Insurance  
Question:   What are the reasons for the decision that insurance companies must obtain a licence in 
each province in which they conduct business?  Has t hought been given to modifying this situation? 
 
[Costa Rica Question 13] 
 
Question :  Is insurance regulation, as well as the authority responsible for enforcing it, specific to 
each province?  Is there also federal legislation and regulation? 
 ANSWER (to Questions 12 & 13):   In Canada, the jurisdiction ove r the business of insurance is 
shared between the federa l and provincial governments.   If a company is incorporated under federal 
insurance legislation, it must govern itself according to federal rules.  Similarly, if a company is 
incorporated under provincial insurance legislati on, it must observe provincial governance rules.  
However, for market conduct rules, such as licensi ng, marketing, sales practices, consumer protection, 
the company must follow provincial laws regardle ss of whether it is federally- or provincially-
incorporated.  This shared competency is a produc t of our Canada’s federa l constitutional framework. 
 
[Costa Rica Question 16] 
 
Banking services 
 
Question:   Page 147, Paragr aph 140.  Domestic banks  and subsidiaries of fore ign banks must obtain a 
letter patent of incorporation issued by the Minister of Finance (Paragraph 139).  Paragraph 140 
indicates that all relevant matters must be taken into account to determine whether to issue letters 
patent of incorporation, an d one of those relevant fact ors is the "best interest of the financial system in 
Canada".  With respect to this topic, Costa Rica would like to know what factors are taken into account when 
denying the issuance of letters patent according to the “best interest of the financial system in 
Canada”?  In what specific cases can letters patent be  denied in keeping with the best interest of the 
financial system in Canada?  ANSWER:   The Minister of Finance has the discretion to  determine whether something is or is not in 
the best interests of the financial system in Canada.  Section 27 of the Bank Act  provides a full 
description of the considerations the Minister of Fina nce would consider in reviewing an application.  
These include, for example, the nature and sufficien cy of resources, soundness and feasibility of the 
plans of the applicant, business reco rd and experience, character and integrity of the applicant, etc.  
Generally, the Office of the Superintendent of Financial Institutions would base its recommendation 
regarding this matter on whether it is of the view th at the proposed operations of the applicant would 
be detrimental to the Canadian regulated financial sector. 
 
[Costa Rica Question 17] 
 
Question on page 148, paragraph 144:   This paragraph states:  “At least half of the directors of a 
foreign bank subsidiary, and at least two-thirds of  the directors of any other bank must reside in 
Canada at the time of each director's election or appointment.” 
 Is there any differentiated procedure with respect to other immigrants so that foreigners who want to 
be bank directors can obtain residency?  Must the dire ctor be resident in Cana da during the entire time 
he/she is functioning as such or only when he/she is elected? 
  WT/TPR/M/179/Add.1 
 Page 233 
 
 
ANSWER:   The residency requirement is at the time of the director’s election or appointment. 
 
[Costa Rica Question 18] 
 
Question on page 146, paragraph 136 and page 149, paragraph 146:   Paragraph 136 indicates that 
deposit insurance does not cover deposits in full- service branches, while Paragraph 146 establishes 
that full-service branches of foreign banks cannot be accepted as members of the Canada Deposit 
Insurance Corporation.  Does deposit insurance not cover deposits made in fu ll-service branches, be they domestic or foreign, 
or does that restriction apply only to foreign companies?  Where it only applies to foreign entities, 
what is the reason for that differentiation?  ANSWER:   Deposits made at a branch in Canada of a federally or provincially regulated Canadian 
incorporated deposit taking institution are eligible for Canadian deposit insurance.  The Canadian 
deposit taking institution may have dom estic or foreign ownership.  In light of the fact that they are 
subject to a lighter regulatory regime, foreign banks that are authorized to maintain bank branches in 
Canada are not allowed to take deposits under $150,000 a nd these deposits are not eligible for deposit 
insurance.  
[Hong Kong, China Question 7] 
 
Banking Services 
 
Question on pages 114-5, paras. 134-5:   While Canada has inscribed in its GATS schedule a 10% 
ceiling for the acquisition of shares of a Canadian bank with over Can$1 billion in equity, it is noted 
from the Secretariat Report that under Canada's  existing regime, only banks with equity of 
Can$5 billion or more (i.e. large banks) must be wide ly held with no more than 20% of the bank's 
voting shares or 30% of its non-voting shares acquired by  a single person.  No such ceiling is however 
being imposed for medium banks (i.e. equity of Can$1 billion or more, but less than Can$5 billion) 
and small banks (i.e. equity of less than Can$1 b illion), though approval from the Ministry of Finance 
is required for any single person to own more than 10% of the shares. 
 
Given the de facto more liberal regime, would Cana da consider binding its existing regime in the 
current round of services negotiations in line with its commitment to reducing impediments to trade 
and enhancing predictability in the multilateral trading system? 
 
ANSWER:   Canada is considering further improvements to  its financial services offer, but has not yet 
determined which, if any, par ticular measures will be scheduled. 
 
[Hong Kong, China Question 8] 
 
Question on pages 114-5, paras. 134-5:   As mentioned in paragraph 135 of the Secretariat Report, 
the Canadian Government proposes to increase the e quity threshold for large banks to Can$8 billion, 
and for small banks to Can$2 billion.  Grateful to know more details about the proposal including its latest progress and the expected timeframe for its implementation. 
 
ANSWER:   The financial institutions statutes are review ed in Canada every five years. Bill C-37, An 
Act to amend the law governing financial institutio ns and to provide for related and consequential 
matters , was tabled on November 20, 2006.  Parliament is  currently reviewing the Bill, with a view to 
having the legislation in force by the sunset date of April 24, 2007. 
 WT/TPR/M/179/Add.1 
Page 234  
 
Regarding the ownership thresholds, the proposed legi slation includes adjusting the equity thresholds 
that determine the size of financial institutions to  take into account the growth of the sector since 
2001.  Large institutions required to  be widely held will be those over $8 billion in equity. Medium-
sized institutions generally require d to float 35 per cent of their voting shares will become those 
between $2 billion and $8 billion in equity.  Smal l-sized financial institutions, i.e., those up to 
$2 billion under the proposed legisla tion (currently up to $1 billion or less) can be entirely privately 
held.  
[Argentina Question 20] 
 Question on paragraph 129, page 144:  Could Canada indicate the main points of the new financial 
legislation introduced to Parliament in November 2006?  
 ANSWER:   The financial institutions statutes are review ed in Canada every five years. Bill C-37, An 
Act to amend the law governing financial institutio ns and to provide for related and consequential 
matters , was tabled on November 207, 2006.  Parliament is currently reviewing the Bill, with a view 
to having the legislation in force by the sunset date of April 24, 2007.  
I. Key Legislative Measures 
 
 The proposed legislation will enhance the inte rests of consumers, increase legislative and 
regulatory efficiency, and adapt th e framework to new developments. 
  The legislation will enhance the interests of consumers by including such measures as: 
 
• Improving the disclosure regime to ensure that consumers have the relevant information to 
make the best decisions in light of the choices available to them. For example, the legislation 
will include a new disclosure regime for deposit- type investment products to ensure that 
consumers receive appropriate information that is specific to the type of products they are 
purchasing. 
 
• Facilitating the establishment of a limit on the time that banks can hold a cheque. 
 
The legislation will increase legislative and regulat ory efficiency by including such measures as: 
 
• Simplifying the foreign bank entry framework a nd reducing the burden, especially for “near 
banks,” (foreign entities that are not regulated as banks in their home jurisdiction, but that provide banking-type services). 
 
• Improving the regulatory approval re gime to ensure that financia l institutions transactions are 
dealt with more expeditiously, th ereby enhancing the efficiency of the process.  As such, the 
legislation will clarify, simplify and streamline the approval requirements for certain 
transactions. 
 
• Adding flexibility to the federal framework for the credit union system by making it easier for 
credit unions to incorporate an association, thereby allowing the system to improve its 
capacity to adapt to new developments. 
 
• Reducing the cost of mortgages for some borrowe rs by raising to 80 per cent the loan-to-value 
threshold above which mortgage insurance is required by statute. 
 The legislation will adapt the framework to new developments by including such measures as: 
  WT/TPR/M/179/Add.1 
 Page 235 
 
 
• Providing an enabling framework for electronic cheque imaging that will result in significant 
efficiency gains, saving time and resources curre ntly dedicated to the transport of cheques. 
 
• Improving the Bank Act special security regime by proceeding with changes to the 
administration of the regime. 
 
• Adjusting the equity thresholds that determ ine the size of financial institutions for the 
purposes of the ownership regime, to take into  account the growth of the sector since 2001. 
Large institutions required to be widely held will be those over $8 billion in equity. Medium-
sized institutions generally required to float 35 per cent of their voting shares will become 
those between $2 billion and $8 billion in equity. 
 
• Allowing Canadian financial institutions to a dd more foreign experts to their boards as long 
as the majority of directors remain Canadian residents.  The changes will allow Canadian 
institutions to attract expertise, strengthen thei r networks and enhance their capacity to pursue 
global business opportunities. 
 In terms of streamlining of the foreign bank entry regime, the 2006 Financial Institutions Legislation 
Review identifies a number of measures, including: 
 
• To simplify the foreign bank entry framework and reduce burden, the Government proposes 
to narrow the framework to focus on real forei gn banks.  It proposes to  remove near banks 
from the foreign bank entry framework and e liminate the entry approval for near banks 
undertaking unregulated financial services. 
 
• In addition to this, the legislative review has identified a number of technical changes that 
will contribute to streamlining the framework: 
  allowing foreign banks investment in  mutual fund management entities; 
 allowing foreign banks investment in closed-end funds;  allowing foreign banks to hold temporary investments in non-permitted entities; 
 allowing foreign banks access to automated banking machines; 
 allowing foreign banks to directly en gage in specialized financing entities; 
clarifying that foreign banks to establish a regulat ed securities branch to engage in investment 
counselling and portfolio management; 
 clarifying that foreign banks can have a holding company that owns both domestic and 
 foreign entities; 
replacing the requirement that a foreign bank can provide financial statements for its affiliates 
doing business in Canada. 
(7) MARITIME TRANSPORT 
 [Costa Rica Question 20] 
 
Question on paragraph 162:   Para. 162 says:  During the period under review, Canada modified its 
maritime transport legislation to supplement th e more significant changes implemented in earlier 
years.  The Canada Shipping Act (CSA), the princi pal legislation governing the operation of Canadian 
flag vessels and of foreign vessels in waters under Ca nada's jurisdiction, was amended in 2001.  The 
CSA received Royal Assent in November 2001 but th e amended act will not enter into force until 
supporting regulation has been deve loped, which according to the authorities will be completed by 
early 2007.  The Marine Liability Act of 2001 cons olidated in a single statute all marine liability 
regimes, including compensation for pollution damage.  What are the main changes that were made to the legislation on maritime transport? WT/TPR/M/179/Add.1 
Page 236  
 
 ANSWER:   The new maritime transport legislati on represents a streamlining of the old act, 
integrating more modern language.  The changes were made in large part to bring Canada in line with 
international marine conventions, such as the Intern ational Convention for the Safety of Life at Sea. 
 [Argentina Question 21] 
 
Question on paragraph 164, page 153:   Para 164 says: To register a ship in Canada, the owner must 
be a Canadian citizen, permanent resident or a co rporation incorporated unde r federal or provincial 
laws of Canada (regardless of the origin of capital) .  However, foreign corporations may also register 
a ship in Canada, if the ship is not already register ed in another country, and if one of the following is 
acting with respect to all matters relating to the ship:  (i) a subsidiary of the fo reign corporation that is 
incorporated in Canada, (ii) an employee or director in Canada of a branch office of a corporation that 
is carrying business in Canada, or (iii) a ship mana gement company incorporated under the federal or 
provincial laws of Canada.  Notwithstanding the a bove, the Minister of Transport may direct the 
registrar to refuse to register a vessel built outsi de Canada.  The authorities note that this provision 
was not used during the period under review.  Could Canada explain the reasons why registratio n of a vessel built outside of Canada might be 
refused?  What are the reasons behind this type of provision?  
ANSWER:   The provision in the Canada Shipping Act with respect to the Minister directing the 
Chief Registrar to refuse to register a ship built outsi de of Canada has never been used.  Nevertheless, 
the provision was first put in place in order to pr ovide the Minister with the ability to act in 
extraordinary situations, including, inter alia , to deal with risks to safety or the environment, and 
when UN sanctions are imposed on the originating country. 
 
(8) AIR TRANSPORT 
 [China Question 21]  
Question:   Foreign investors’ shares in Canadian air lines are restricted to 25%.  Please explain the 
reasons for the above restriction. 
 ANSWER:   Canada is preparing a written response to th is question which will be provided later. 
 
[Costa Rica Question 21] 
 
Question on paragraph 192:   According to the document, Ca nada has not bound consumption of 
aircraft repair and maintenance services abro ad under the GATS and retains the possibility of 
requiring carriers to use domestic repair and maintenance services.  Question 21 (a):   Does Canadian legislation specifically  prohibit Canadian carriers from consuming 
aircraft repair and maintenance services abroad?  
 Question 21 (b):   What are the existing restrictions for a foreign company seeking to establish itself 
in Canada and provide these services?  
ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
  WT/TPR/M/179/Add.1 
 Page 237 
 
 
[Costa Rica Question 22] 
 
Question:   According to the document, all maintenance and repair operations on  Canadian-registered 
aircraft must be carried out by approved organi zations.  The authorities note that “approved" means 
approved in accordance with the Canada Aviation Regul ations, or the regulatio ns of a foreign state 
that is party to an agreement or technical arrangeme nt with Canada.  In the absence of an agreement 
or arrangement, that maintenance may only be ca rried out by a foreign organization under the 
framework of a contract with a Canadian organi zation, provided that the Canadian organization 
carries out the necessary supervision to ensure compliance with the applicable regulations. 
 
Question 22 (a):   What requirements apply to a contract between a Canadian and a foreign 
organization for providing these services?  Question 22 (b):   Who regulates the relationship between the two organizations?  Must this 
contractual relationship be approve d by any Canadian authority? 
 
ANSWER:   Canada is preparing a written response to this question which w ill be provided later. 
 
(9) PROFESSIONAL SERVICES 
 [China Question 22] 
 
Legal services 
 
Question:   In Prince Edward Island, Ontario, Alberta and Newfoundland, permanent residence is one 
of the requirements for the registration of a lawyer , while in Quebec, a lawyer must be a Canadian 
citizen. 
 Please explain the reasons for the above requirements. 
 
ANSWER:   In Canada, professions are self-regulating.  Th is authority is delega ted by provincial and 
territorial governments to regulatory bodies by legi slation, on the basis that their mandate is to 
regulate their members in the public interest.  Resi dency requirements are maintained for the purpose 
of liability/consumer protection (recourse through courts and professional disciplinary purposes), as 
well as to maintain voting rights in membership affairs.  Canada has removed a number of provincial/territorial  citizenship and residency requirements in the 
professional services sectors in line with domestic liber alization that has occurred.  Canada continues 
to consult with its national professional associations  and provincial and territorial governments with 
respect to removing additional residency requirements.   Where Canada is unable to remove remaining 
sub-federal residency requirements,  Canada is looking at binding the temporary licensing regimes for 
some professions in its second revised GATS offer.   This approach would make the process more 
transparent for foreign professionals to be able to  temporarily provide certain types of professional 
services in various sub-federal jurisdictions. 
 
[China Question 23] 
 
Architectural and engineering services 
 Question:  Anyone who wants to engage in architectural services must obtain a license for a 
provincial or regional architect association.  An applicant must pass qualifications test. 
 Could Canada provide the information on how ma ny applications from foreigners have been 
approved, how many have been  rejected since 1995 until now? WT/TPR/M/179/Add.1 
Page 238  
 
ANSWER:   Statistics are not immediately available; however, Canada will endeavour to obtain this 
information to be forwarded to Members at a later date following the Trade Policy Review. 
 
[China Question 26] 
 Question:   Many Chinese companies complain that th e examination and approval process of short-
term business visas, work permits and work vi sas for their staff are over-complicated and time-
consuming, which hinders their business and investment activities in Canada. 
 Could Canadian government streamline those proce dures in order to guarantee the normal conduct of 
business between China and Canada? 
 ANSWER:   In the GATS context, Canada has significant Uruguay Round commitments and strong 
offer on mode 4 which covers Business Visitors, Intra-corporate transferees, Contract Service Suppliers and Independent Professionals.  Canada’s UR commitments have eliminated the need for a 
labour market test for WTO Members qualifying as a professional – one of the major hurdles business 
persons face when entering a country to work on a temporary basis.  Furthermore, our commitments 
on Business Visitors cover business persons entering Canada to attend trade fairs, participate in 
business meetings or similar activities without the requirement of a labour market test or a work permit. As per the Annex to the GATS on the Move ment of Natural Persons , paragraph 4, members 
may apply measures to regulate the entry of na tural persons into its territory, including the 
requirement for a visa.  We are always seeking ways to improve the administration of our immigration 
framework and would encourage you to share with us the details of your con cerns at a later date.  
Canada seeks to provide timely and efficient service  to clients in all countries. Canada now offers 
visitor, student and work permit processing at th ree offices in China - Beijing, Shanghai and Hong 
Kong.  Processing times for most services have impr oved in recent years.  For example, over 80% of 
visitor visa applications at Hong Kong are processed  within 2 days, and in Shanghai over 75% of 
work permit application are processed within one  month in 2006, 30% more than were processed 
within the same period in 2005.  We are curren tly looking at ways to improve and simplify the 
process in China.  
[Costa Rica Question 23] 
 
Question:  Which professions are regulated in Canada at the national level and which are regulated at 
the provincial/territorial level?  ANSWER:   In Canada, each of the ten provinces and three territories are generally responsible for 
their own regulated professions.  Professional occupa tions are usually regulated by a self-governing 
body that is established through provincial and territo rial legislation.  These bodies have the power to 
decide on the exact process of licensing their memb ers, but are still subject to the scrutiny of the 
province or territory.  A few professions are regulated federally.  Ultimately, each province and territory has the power to decide on what is requi red to work in the regulated professions.  Because 
the safety of the public is of great concern in Canada, this is a role that is taken very seriously.  In 
most cases, the professions are represented at the national level by a national professional association, 
which acts as an umbrella organization for the provincial bodies, though is not a regulatory body itself.  
[Argentina Question 22] 
 
Question on Paragraph 197, page 162:   Is Canada working on any projects designed to enable 
foreign lawyers to act as legal consultants in the province of Québec and in the Northwest, Yukon and 
Nunavut territories?  
ANSWER:   No.  There are no such regimes in place in those territories and province.  WT/TPR/M/179/Add.1 
 Page 239 
 
 
[Pakistan Question 5] 
 Immigration and Visa Policy  
Question:   While the Canadian government is enc ouraging immigration of professional human 
resource from Pakistan, it is generally denying busi ness visas to the genuine businesspersons, who are 
nominated by their respective trade bodies and recommended by the government for their business related travel.  Could Canada justify such discriminatory policies that run against business and economic interest of 
developing countries? 
 ANSWER:   In the GATS context, Canada has significant Uruguay Round commitments and strong 
offer on mode 4 which covers Business Visitors, Intra-corporate transferees, Contract Service Suppliers and Independent Professionals.  Canada’s UR commitments have eliminated the need for a 
labour market test for WTO Members qualifying as a professional – one of the major hurdles business 
persons face when entering a country to work on a temporary basis.  Furthermore, our commitments 
on Business Visitors cover business persons entering Canada to attend trade fairs, participate in 
business meetings or similar activities without the requirement of a labour market test or a work permit.  As per the Annex to the GATS on the Move ment of Natural Persons, paragraph 4, members 
may apply measures to regulate the entry of na tural persons into its territory, including the 
requirement for a visa.  We are always seeking ways to improve the administration of our immigration 
framework and would encourage you to share with us th e details of your concerns at a later date.  In 
the meantime, we trust the following inform ation on our visa regime will be useful: 
 Under Canada's Immigration and Refugee Protecti on Act, every foreign national, except people from 
countries specifically exempted in the Immigrati on and Refugee Protection Re gulations, must have a 
temporary resident visa before arriving in Cana da.  Temporary resident visa requirements allow 
Canada to fulfil the objectives of the Immigration and Refugee Protection Act by facilitating the entry 
of bona fide visitors to Canada for such pur poses as trade, commerce, tourism, international 
understanding, and cultural, educa tional and scientific activities, wh ile also protecting the health, 
safety and security of Canadian society. 
 
Approval of a temporary resident visa applicatio n cannot be guaranteed as each application is 
considered on its own merit.  Visa officers look at many factors in assessing whether an applicant is a 
genuine temporary resident.  They consider the purpo se of the visit and the applicant's ties to his or 
her home country, including the family and economic s ituation.  Foreign nationals wishing to come to 
Canada as temporary residents must  show that they will respect the conditions that apply to temporary 
residents.  One of these conditions is that they will leave voluntarily at the end of the visit. 
 Canada does not differentiate between business vi sitors and persons vis iting Canada for other 
purposes, such as visiting family or tourism.  All vi sitors are assessed agains t the same criteria, and 
the purpose of the visit is only on e element that may be considered. 
 
[India Question 3] 
 
Question:   Indian trade delegates participating at trad e fairs in Canada are frequently denied visas in 
an ad-hoc manner.  This causes financial loss to th em as they have paid up the registration charges, 
rentals for stalls and also has an opportunity cost.  Th is is contrary to the desire of the two countries to 
promote people to people and inter business exch anges between India and Canada.  We request 
Canada to clarify the visa regime so that  such cases are reduced to the minimum. 
 ANSWER:   In the GATS context, Canada has significant Uruguay Round commitments and strong 
offer on mode 4 which covers Business Visitors, Intra-corporate transferees, Contract Service WT/TPR/M/179/Add.1 
Page 240  
 
Suppliers and Independent Professionals.  Canada’s UR commitments have eliminated the need for a 
labour market test for WTO Members qualifying as a professional – one of the major hurdles business persons face when entering a country to work on a temporary basis.  Furthermore, our commitments 
on Business Visitors cover business persons entering Canada to attend trade fairs, participate in 
business meetings or similar activities without the requirement of a labour market test or a work 
permit.  As per the Annex to the GATS on the Move ment of Natural Persons, paragraph 4, members 
may apply measures to regulate the entry of na tural persons into its territory, including the 
requirement for a visa.  However, we are always seeking ways to improve the administration of our 
immigration framework and have ta ken note of your concerns.  We trust the following information on 
our visa regime provides you with some clarification. 
 
Under Canada's Immigration and Refugee Protecti on Act, every foreign national, except people from 
countries specifically exempted in the Immigrati on and Refugee Protection Re gulations, must have a 
temporary resident visa before arriving in Cana da.  Temporary resident visa requirements allow 
Canada to fulfil the objectives of the Immigration and Refugee Protection Act by facilitating the entry 
of bona fide visitors to Canada for such pur poses as trade, commerce, tourism, international 
understanding, and cultural, educa tional and scientific activities, wh ile also protecting the health, 
safety and security of Canadian society.  Approval of a temporary resident visa applicatio n cannot be guaranteed as each application is 
considered on its own merit.  Visa officers look at many factors in assessing whether an applicant is a 
genuine temporary resident.  They consider the purpo se of the visit and the applicant's ties to his or 
her home country, including the family and economic s ituation.  Foreign nationals wishing to come to 
Canada as temporary residents must  show that they will respect the conditions that apply to temporary 
residents.  One of these conditions is that they will leave voluntarily at the end of the visit. 
 
Canada does not differentiate between business vi sitors and persons vis iting Canada for other 
purposes, such as visiting family or tourism.  All vi sitors are assessed agains t the same criteria, and 
the purpose of the visit is only on e element that may be considered. 
 
REPORT BY CANADA (WT/TPR/G/179) 
 
PART I – TRADE AND ECONOMIC POLICY ENVIRONMENT  [Argentina Question 1]  
Question on paragraph 9, page 5:   Would Canada please explain how it proposes to create the 
competitive advantages mentioned in this paragraph?  Please describe in detail the specific means by 
which it intends to achieve these advantages.  As to  the four core principles of “Advantage Canada”, 
could it specify what the role of the go vernment will be (“Focusing government”)? 
 
ANSWER:   Advantage Canada  is a strategic, long-term economi c plan designed to help Canadians 
improve their quality of life and make Canada a world leader fo r today and future generations. 
 
The plan is rooted in the realities of global co mpetition and Canada’s exis ting strengths and economic 
challenges.  While the plan is designed to redu ce barriers to investment and help Canadians and 
Canadian businesses build on their current strengt hs, it also recognizes the importance of making 
strategic investments to build a solid and sustainable foundation for the economy. 
 
Advantage Canada is focused on creating five Canadian adva ntages that will help us improve our 
quality of life and succeed on the world stage:   WT/TPR/M/179/Add.1 
 Page 241 
 
 
Tax Advantage: 
• Canada’s Tax Advantage will reduce taxes for all Canadians a nd establish the lowest tax rate 
on new business investment in the G7. 
 
Fiscal Advantage: 
• Canada’s Fiscal Advantage will eliminate Canada’s total government net debt in less than a 
generation, creating a strong foundation on which to build sustainable prosperity. 
 
Entrepreneurial Advantage: 
• Canada’s Entrepreneurial Advantage will reduce unnecessary regulation and red tape and 
lower taxes to unlock business investment .  By building a more competitive business 
environment, consumers will get goods at lower prices and Canadian businesses will be better 
equipped for global success. 
 
Knowledge Advantage: 
• Canada’s Knowledge Advantage will create the best-educated, most-skilled and most flexible 
workforce in the world. 
 
Infrastructure Advantage: 
• Canada’s Infrastructure Advantage will create modern, world-cl ass infrastructure to ensure 
the seamless flow of people, goods and services across our roads and bridges, through our 
ports and gateways, and via our public transit. 
 As part of the Entrepreneurial advantage of Advantage Canada , the Government committed to 
developing a comprehensive Global Commerce Strategy to ensure that Canadian business can fully 
participate in global market opportunities. 
 While Canada’s main trade policy priority remains a successful Doha Round, the Strategy would also 
include:   - Concerning the U.S. and North America, improving border efficiency and increasing 
regulatory convergence through the Security and Prosperity Partnership initiative;  
  - pursuing regional and bilateral trade,  investment, and science and technology 
agreements; and 
 
 - strengthening our presence and profile  in new markets, such as in Asia. 
 Moreover, the framework would promote the coheren ce of Canada’s trade policy with other policies, 
not limited to business development, such as sust ainable development, e nvironmental and labour 
policies. 
 
This new strategy is being deve loped in consultation with key st akeholders.  The Government of 
Canada has a long-standing framework for public consultations and outre ach aimed at engaging 
Canadians and, in particular, other levels of government, including provinces and territories, in the 
development of trade policies and initiatives.  The Government of Canada formally announced its 
intention to implement the GCS in  its new Budget of 19 March 2007. 
 WT/TPR/M/179/Add.1 
Page 242  
 
Part II – TRADE POLICY DEVELOPMENTS 2003-2006 
 
(2) Supporting Development 
 [Pakistan Question 1] 
 Question:   At the Hong Kong Ministerial Conference in  December 2005, Ministers agreed that for 
grant of duty free, quota free access to LDCs, its impact on other similarly placed countries would be taken into account.  
Has Canada analyzed as to how this initiative aff ected in real terms the imports from other low-
income developing countries such as Pakistan when Canada allowed duty free quota free market 
access to some countries?  ANSWER:   Canada's original decision to extend tariff-free and quota-free access to most imports 
from least-developed countries was made at the G8 Kananaskis Summit held in 2002 as one of a 
number of initiatives taken by Cana da in support of Africa's development.  The program announced at 
this Summit came into effect for all LDC countries on January 1, 2003.  Canada’s decision to provide duty- and quota-free access for most produc ts from LDCs was targeted at 
improving the economic prospects of the poorest count ries of the world.  To facilitate this, the 
initiative’s rules of origin, particularly those associ ated with apparel products, were designed to help 
LDCs benefit from the program.  These rules allow LDCs to use fabric imported from other developing countries in ap parel exported to Canada. 
 Therefore, while other low-income developing countr ies such as Pakistan do not benefit directly from 
the LDC initiative, they are placed in a position to be nefit indirectly by, for example, supplying fabric 
to LDCs.  Canada would also note that the exports  of Pakistan and other low-income developing 
countries already benefit from preferential access to  the Canadian market under Canada’s General 
Preferential Tariff (GPT) Program.  Canada remains committed to working with developi ng countries, especially the least developed, to 
help them benefit further from trade liberalizati on and integrate fully into the multilateral trading 
system.  
(8) Other Initiatives 
 
(c) Asia-Pacific Gateway and Corridor Initiative 
 [Korea Question 10]  
Question on p.20 para.102:   Foreign export enterprises currently face difficulties, such as extending 
the period of transport and dealing with rising transportation prices, due to a slowdown in the 
distribution of goods between Vancouver and Toronto. 
 
To cope with this problem, the Canadian governme nt is taking measures to expand and improve its 
transportation infrastructure through a plan known as,  "Asia Pacific Gateway and Corridor Initiative". 
 
Exports are usually loaded two to three weeks prio r to the actual delivery date in order to deliver 
products to their destination in a timely manner.  Ho wever, access to statistic al data on maritime and 
ports is prohibited for the sake of public security.  Korea hopes that Canada will provide data similar 
to the data provided by the U.S. so that shippi ng industries will be able to implement progressive 
transport plans. 
  WT/TPR/M/179/Add.1 
 Page 243 
 
 
ANSWER:   It is unclear from your question as to wh ich type of informati on you believe cannot be 
provided by Canadian authorities.  If you could provi de further clarification, Canada would be pleased 
to provide a response from the appropriate Canadian government agency.  
(g) Science and Technology Strategy 
 
[Argentina Question 2] 
 
Question on Paragraph 111, page 24:   Could Canada explain whether the science and technology 
strategy referred to in this paragraph has in fact  been developed?  What type of government support 
does the strategy entail? 
 ANSWER:   The S&T strategy is still being developed. 
 It will be a framework that will guide federal gove rnment decision-making in support of S&T over the 
coming years.  It will build on the policy directions announced in Advantage Canada: Building a 
Strong Economy for Canadians  (November 2006) to create a business environment conducive to 
innovation, while sustaining Canada's research excelle nce and supply of highly qualified personnel.  It 
will also be consistent with the funding commit ments that were announced in Budget 2007 (March 
2007) in support of science and technology.  OTHER QUESTIONS  [China Question 24]  Other services 
 Question:   The Investment Canada Act stipulates that the publication and distribution of books with 
foreign investment must fit the national cultural po licy of Canada, and generates a “net benefit” for 
Canada.  Besides, direct acquisitions of Canadian publishing houses by foreign investors are prohibited.  
Please explain how the relevant Canadian authoriti es determine if an application “fits the national 
cultural policy of Canada” and what is a “net benefit”. 
 
ANSWER:   The Department of Canadian Heritage lists  the strategic objectives that investments in 
the cultural sector should, where possible, correspond to.  This list can be found at: 
http://www.pch.gc.ca/progs/ac-ca/progs/eiic-csir/net_e.cfm. 
 Direct acquisition by non-residents of Canadi an-controlled businesses in the book publishing and 
distribution is not allowed unless extraordinary circ umstances are met.  Foreign investment in new 
businesses are considered favourably provided the i nvestment is through a joint venture with 
Canadian control.  Indirect acquis itions are allowed, subject to a net benefit test.  More information on 
the Canadian foreign investment policy in book publishing and distribution can be found at: 
http://www.pch.gc.ca/progs/ac- ca/progs/eiic-csir/bookp_e.cfm. 
 The Investment Canada Act  specifies the factors that must be taken into account in assessing the "net 
benefit" criterion.  These factors include the invest ment's effect on:  economic activity, employment, 
resource processing, exports, the use of Canadian products, productivity, efficiency, technological 
development, product innovation an d variety, and competition.  They also comprise the investment's 
compatibility with national industrial, economic, a nd, where applicable, cultural policies and "the 
degree and significance" of participation by Canadi ans in the business resulting from the investment. 
 WT/TPR/M/179/Add.1 
Page 244  
 
[China Question 25] 
 
Question:  The acquisition by foreign investors of film  distribution companies controlled or owned 
by Canadians are prohibited.  Foreign investor s are allowed to establish new film distribution 
companies only when Canadian importers has got global distribution right or is the main investor of 
the new established company.  Foreign investors may directly or indirectly acquire film distribution 
companies within the territory of Canada only when they re-invest their revenues in Canada. 
 Why does Canada set the above restrictions? 
 
ANSWER:   These limitations are part of the cultural po licies that the Canadian governments have for 
many decades adopted to sustain creative expressions in Canada.  A core social objective of these 
policies is to ensure that Canadians can express a nd share their diverse cultural experiences with each 
other and the world.  REPLIES PROVIDED BY CANADA TO OUTSTANDING QUESTIONS AND SUPPLEMENTARY ANSWERS  SECRETARIAT REPORT  SUMMARY OBSERVATIONS 
 [Bolivia Question 3]  Paragraph 66 
 
Question:   “The CIFTA contains disciplines on govern ment procurement, but does not cover cross 
border trade in services or investment.”  
Why did the CIFTA agreement not include or not consider chapters on cross-border trade and/or 
investments?  Are there restrictions on trade in services in this agreement? 
 ANSWER:   Canada and Israel agreed at the outset of CIFTA negotiations that investment and 
services would not be included in the treaty.  Canada's current approach is to seek services and investment coverage in all of its international tr ade agreements.  This reflects the importance of 
services and investment trade to the Canadian ec onomy as well as the global market.  As the CIFTA 
does not include a chapter on cross-border services, restrictions on trade in services are not covered by 
the scope of the agreement. 
 
[
Bolivia Question 4] 
 The Secretariat Report says that “Virtually all professions are regulated at the provincial/territorial 
level and increasing efforts are being made to f acilitate the mobility of professions among provinces 
and territories.  While citizenship and residency re quirements continue to apply in some cases, some 
barriers have been removed.” 
 
Is there an allowable percentage of foreign par ticipation in the provision of professional services? 
What are the requirements or restrictions for the entry of foreign professionals into Canada? 
 ANSWER:   There is no limit on foreign participation in the provision of professional services in 
Canada.  However, in order to practice a prof ession, foreign professionals must meet specific 
licensing, qualification and accreditation requirement s that all trained professionals (Canadian or 
foreign) must meet.  Canada also maintains some  permanent residency and residency requirements at 
the sub-federal level in order to provide certain  professional services.  These requirements vary by 
profession, as indicated in Canada’s Specific Schedule of GATS Commitments.  WT/TPR/M/179/Add.1 
 Page 245 
 
 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
 
(1) O VERVIEW  
 [Bolivia Question 5] 
 The report mentions that “Canada pursues regional and bilateral preferential trade and investment 
initiatives.  Canada exempted from preferential lib eralization commitments certain supply-managed 
tariff lines and cultural activities.”  
Could the Canadian delegation expand on the inform ation stating what it means by “supply-managed” 
and how it is applied in this context?  ANSWER:   Canada’s dairy, poultry and egg sector s operate under a supply management system 
whereby production (supply) is controlled thro ugh marketing/production quotas to meet domestic 
demand.  Supply management relies on predictabl e supplies - achieved through marketing/production 
quotas and import restrictions - in order to bring pri ce stability to the market.  Imports are restricted 
through tariff quotas and high over-quota tariff rates.  In keeping with Article 4 of the WTO Agreemen t on Agriculture, Canada established tariff-rate 
quotas to replace import controls in support of supp ly managed products.  Imports within these tariff 
quotas are subject to the applicable tariff treatment depending on the origin of imports.  These may be 
MFN rates or preferential trade agreement rates.  There are no preferential trade agreement tariff rates 
applying to imports above these tariff quotas.  
[Bolivia Question 6] 
 
Why did Canada include liberalization of cultura l activities in the withdrawal of preferential 
liberalization commitments?  What type of cultura l activities does the paragraph in question refer to? 
 ANSWER:   A core social objective in Canada is to en sure that Canadians can express and share their 
diverse cultural experiences with each other and the world. 
 
The Government of Canada provides programs a nd policies that encourage Canadian cultural 
expression in all its diversity and that ensure Ca nadians also have access to their own cultural 
products, and to foreign cultural products as well.  
In fact, Canada’s is one of the world’s most open markets for cultural products and services. 95.5% of 
box office revenues in Canada are from foreign film;  77% of the music played on radio and 57% of 
television programming are also from foreign origin.  In addition, more than 50% of magazines and 
periodicals sold in Canada are also foreign.  Internationally, Canada’s policy is to ensure that  it has the necessary flex ibility to support cultural 
policy objectives, while remaining open to the wo rld.  In the context of bilateral and regional 
preferential trade and investment agreements, Ca nada has a cultural exemption which serves this 
purpose.  The cultural exemption covers measur es relating to a defined range of industries: 
 (a) the publication, distribution, or sale of books, ma gazines, periodicals or newspapers in print or 
machine readable form but not in cluding the sole activity of printing or typesetting any of the 
foregoing;   (b) the production, distribution, sale or exhibition of film or video recordings;   
(c) the production, distribution, sale or exhibition of audio or video music recordings;  WT/TPR/M/179/Add.1 
Page 246  
 
(d) the publication, distribution or sale of musi c in print or machine readable form;  or  
 (e) radiocommunications in which the transmissions  are intended for direct reception by the general 
public, and all radio, television and cable broadcas ting undertakings and a ll satellite programming and 
broadcast network services. 
 
(2) G
ENERAL LEGAL FRAMEWORK  
 
Paragraph 8 
 
[Bolivia Question 7]  
According to Canada’s report, ow ing to its legal and constitutiona l framework: “...cooperation by the 
provinces is often required to implement international treaties.”  
Could the Canadian delegation explain what this “cooperation” consists of between the provinces and 
the federal government for the appli cation of international agreements? 
 ANSWER:  The (federal) Government of Canada has ex clusive responsibility for the negotiating and 
conclusion of treaties.  The responsibility for the passing of legislation implementing treaty obligations follows the ordinary division of legisl ative powers between the (federal) Parliament of 
Canada and the provincial legislatures.  Therefor e, consultation between th e federal and provincial 
governments is normal in respect of treaties that c over matters falling within provincial jurisdiction, 
before the federal government binds  Canada in international law. 
 
(4) F
OREIGN INVESTMENT REGIME  
 
[Turkey Question 1] Para 20, 26 
 
Question 1 (d):   How does Canada consider to deal with  the problem of slow productivity growth? 
 ANSWER:   The Government of Canada released  Advantage Canada in November 2006, a long-term 
economic plan designed to build a strong Canadi an economy and help Canadians improve their 
quality of life.  The Plan builds on Canada’s strengths and seeks to gain a global competitive advantage in five key 
areas: 
 
• Tax Advantage—Reducing taxes for all Canadian s and establishing the lowest tax rate on 
new business investment in the G7. 
• Fiscal Advantage—Eliminating Canada’s total gove rnment net debt in less than a generation. 
• Entrepreneurial Advantage—Reducing unnecessary regulation and red tape and increasing 
competition in the Canadian marketplace. 
• Knowledge Advantage—Creating the best-edu cated, most-skilled and most flexible 
workforce in the world. 
• Infrastructure Advantage—Building th e modern infrastructure we need. 
 
Reducing debt, lowering taxes, creating a highly skilled workforce, improving infrastructure, and 
reducing unnecessary regulations are the consensus me asures proposed to ensure Canada continues to 
enjoy increasing economic growth and improves its productivity performance. 
 The Plan also recognizes that both inward and outwa rd foreign direct investment bring substantial 
economic benefits to Canada.  Foreign direct investment bri ngs additional capital, advanced  WT/TPR/M/179/Add.1 
 Page 247 
 
 
technologies and innovations, new ma nagement practices and healthy competition.  Foreign direct 
investment abroad allows firms to be more integr ated into global supply chains, be more productive 
and competitive.  In this regard, the Government comm itted in its long-te rm economic plan— Advantage Canada --to 
review its foreign investment policy framework, in cluding the Investment Cana da Act, with the aim 
of maximizing the benefits of foreign investment for Canadians, while retaining Canada’s ability to 
protect national interests.  
(5) I
NTERNATIONAL RELATIONS  
 
(ii)  Preferential trade agreements and other arrangements.   [Bolivia Question 8] Paragraph 60  
It mentions that “Canada has held exploratory discussion on possible free-trade negotiations with the 
Dominican Republic, Andean Community members, and CARICOM members.”  What are the results of the exploratory discussion?  What are the areas that Canada is interested in 
negotiating with the Andean Community? 
 
ANSWER:   Canada supports the goal of free trade w ith the countries of the Andean Community.  
Exploratory discussions towards potential free trad e agreement negotiations have been productive. 
Canada is interested in negotiating a comprehensiv e and high quality free trade agreement with rules 
and disciplines in areas such as trade in goods, se rvices and investment with prepared Andean 
countries.  In keeping with its approach, Canada  would also seek to negotiate provisions on labour 
and environment.  
 
III. Trade Policies and Practices by Measure 
(2) M
EASURES DIRECTLY AFFECTING IMPORTS  
 (i) Procedures 
 
[India Question 1] 
 
Question:   We have been informed by small scale exporters from India that they are facing payment 
problems as importers in Canada are not honour contra ctual obligations.  As the scale of such business 
operations is small therefore they find it difficult to  resort to costly and time consuming legal recourse 
and this also constitutes a NTB.  We request Canada  to inform if any mech anism is put in place to 
investigate such cases and provide assistance to small scale exporters from developing countries. 
 ANSWER:   There are no provisions in Canada’s Customs Act  which provide recourse for an exporter 
who feels aggrieved by a Canadian importer.  Th e Government of Canada does not get involved in 
commercial disputes.  Indian exporters who are encountering these problems should seek legal 
assistance to resolve the issue.  
(iv) Tariffs 
 
[Hong Kong China Question 1]  
Question on P. 31-32, Paras. 37, 39 & Table III.1:   We appreciate that Canada has bound 99.7% of 
its tariff lines and that the simple average applied tariff had declined slightly from 6.8% in 2002 to 6.5% in 2006, due to tariff reductions following the implementation of WTO commitments.  We note WT/TPR/M/179/Add.1 
Page 248  
 
from the Secretariat Report that for 23 tariff lines, the ad valorem equivalents could not be estimated.  Grateful for the clarification from Canada.  ANSWER:  The calculations of the ad valorem  equivalents Hong Kong, China is referring to were 
performed by the WTO Secretariat, as explained in foot note 30 of the Secretariat report.  It would thus 
be highly speculative from Canada to pr ovide an explanation as to why the ad valorem  equivalents for 
these 23 tariff lines could not be estimated.  
[Bolivia Question 9] Paragraph 46 
 Question:   The report states that “Dairy products, poultr y, eggs, refined sugar, and most textiles, 
clothing, and footwear are not eligible for preferential tariff treatment.”  Could the Canadian delegation clarify what cond itions are required for those products to become 
eligible for preferential tariff treatment? 
 
ANSWER:   Under the GPT, Canada unilaterally provid es preferential tariff treatment to a number of 
products exported from developing countries.  The exclusion of certain products from the GPT is 
indicative of the fact that these are sensitive products  from a Canadian perspective.  From time to 
time, the GPT is reviewed and the issues of produ ct coverage may be considered the next time a 
review takes place. 
 
(v) Other charges affecting imports 
 
[Turkey Question 2] 
 
Question on para. 57:   According to the Secretariat Report, the goods and services are levied under 
the Excise Tax Act which is defined as the Canada’s  largest indirect tax by revenue, amounting to 
around 15% of total federal budgetary revenue.  
Question 2(a):   Could Canadian Delegation clarify the reason to this tax arrangement? 
 ANSWER:   The Goods and Services Tax (GST) is a broa d based consumption tax, which applies to 
most goods and services consumed in Canada.  As a general principle, it is preferable for economic 
and administrative reasons to apply a consumption tax to a broad base of goods and services because 
it allows the tax rate to be set low while still raisi ng an adequate level of re venue for the government.  
Moreover, value-added taxes, such as the GST, are mo re efficient when applied to the broadest range 
of goods and services.  A broad base tax also minimizes administration and compliance costs.  The GST is Canada’s largest indirect tax by reve nue, generating nearly Ca n$30 billion in fiscal year 
2004/05 and amounting to around 15% of total federal budgetary revenue. 
 
Question 2(b):   Could Canadian Delegation confirm the a ll imports regardless of their sources are 
levied under the excise tax?  ANSWER:   The GST, as a broad based consumption tax, applies equally to imported and 
domestically produced or supplied goods and services.  Application of the GST also does not 
discriminate between imported goods and services from different countries.  
[Argentina Question 6] 
 
Question on paragraph 59, page 43:   Could Canada explain why some provinces apply the HST and 
others do not?  Why is this tax a pplied at different rates for differe nt products?  Is there a publication 
one can consult for the rates applied to various products?  WT/TPR/M/179/Add.1 
 Page 249 
 
 
ANSWER:   i) In Canada, the provinces have taxing powers similar to the federal government. 
 Presently, three provinces (Nova Scotia, New Br unswick, and Newfoundland and Labrador) have 
harmonized their provincial sales taxes with the GST under the Harmonized Sales Tax (HST).  In 
these participating provinces, the HST is composed of a federal component at the rate of 6% 
(equivalent to the rate of the GST)  and a provincial component at the ra te of 8% – for a total HST rate 
of 14%.  The HST is imposed on the same goods and services as the GST.  The provincial portion of 
HST revenues are calculated and paid to the pa rticipating provinces using a revenue sharing 
mechanism.  
While the federal government is encouraging non-participating provinces to harmonize their retail 
sales tax with the GST, to date, these provinces con tinue to prefer the use of their own sales tax 
system.  ii) The different tax rates for different products referred to in paragraph 59 are in reference to 
provincial sales taxes and not the HST.  The tax ra te for HST is 14%, which applies to most goods 
and services consumed in a participating pr ovince (i.e., Nova Scotia, New Brunswick, and 
Newfoundland and Labrador).  The rationale for th e different provincial tax rates is a matter of 
provincial jurisdiction.  iii) We are not aware of any specific publication to  which one can consult for the different provincial 
tax rates.  However, the provincial governments do maintain websites that provide a broad base of 
information.  As well, it should be noted that Table III.2 (which relates to pa ragraph 59) lists certain 
website links in respect of the provincial sales taxes.  
(vii) Contingency Measures 
 
[Korea Question 7]  
Question on pp.38~44 para.71~92:   At end June 2006, 48 anti-dumping measures, one price 
undertaking and five countervailing duty or ders remained in force in Canada. 
 
Contingency trade measures should be placed to protect domestic industries from unfair foreign trade practices in exceptional cases.  Given that even an  initiation of an investigation affects the business 
activities of the company under investigation by impos ing additional burdens, Canada is requested to 
be more cautious before taking such measures. 
 
We are pleased to note that the current (as of Jun 2006) number of trade remedy measures taken by Canada has significantly dropped (Anti-dumping measures:  91 → 48, Countervailing duties: 10 → 5) 
in comparison with the past (during the TPR in 2003).  Continuing with this trend, Canada is 
requested to be more cautious before  taking such contingency measures.  
 ANSWER:   Canada assures Korea that  it takes great care in initiating and conducting trade remedy 
investigations, which are carried out in full complia nce with Canada's rights and obligations within 
the relevant WTO agreements.  
(viii) Technical regulations, conf ormity assessment and standards 
 
[Vietnam Question 1] 
 
Question:   Canada’s regulation No. D-98-08 requires that importers produce certificate for wood-
packaging to be imported into Canada.  Viet Nam is  of the view that if the certificate issued by 
exporters countries authorities is acceptable that w ould enhance the certainty of business environment.  
Viet Nam thanks Canada for any informa tion that can be provided on this issue. WT/TPR/M/179/Add.1 
Page 250  
 
ANSWER:   Directive D-98-08 provides the requirements for the entry for all wood packaging 
materials including dunnage, pallets or crati ng made from non-manufactured wood entering Canada 
from all areas except the c ontinental United States. 
 All non-manufactured wood packaging materials (as defined in D-98-08) may enter Canada provided 
the material has been officially treated by one  of the methods specified in Appendix 1 of the 
Directive.  A logo or mark (as described in ISPM  No. 15), officially endorsed by the National Plant 
Protection Organization (NPPO) of the country from which the wood packaging materials originates 
must be permanently affixed to each unit of wo od packaging materials. Alternatively, the wood 
packaging materials may be accompanied by a Phytosan itary Certificate, which may be used in lieu of 
the mark. As such, D-98-08 does not require any documentation other an ISPM No. 15 mark applied 
to the wood packaging to accompany the shipment.  The full text of Directive D-98-08 can be found at  the following link: http://www.inspection.gc.ca/ 
english/plaveg/protect/dir/d-98-08e.shtml. 
 
[Vietnam Question 2] 
 
Question:   Viet Nam business enterprises express concer n that difference requirements of labelling 
and marking are applied by different Canadian provinces.  Viet Nam would be grateful if Canada can 
provide information on any plan to improve the situ ation toward uniform application in this area. 
 
ANSWER:   Requirements and the administration for labelling and marking differ by sector across the 
country. For example, the Competition Bureau, Industry Canada, ensures the administration and enforcement of the Textile Labelling Act whereas pr ovincial regulations are additional and only apply 
to the provinces where upholstered and stuffed regula tions exist, Ontario, Quebec and Manitoba.  The 
Federal Government does not have any power over pr ovincial regulations. Consequently, it is up to 
the provinces to administer and enforce those provi ncial regulations within their own provinces.  If 
Vietnam has a question on a particular sector, Canada would be pleased to meet with Vietnam on a bilateral basis.  
 
[China Question 9] 
 
Question:  For imported fresh and processed vegetables and fruits over the packing limit, Canada 
requires that the importers shall provide evidence of  short supply of the product in domestic market in 
order to obtain government’s import permit.  
Does this imply that packing requirement s are related to import restrictions? 
 ANSWER:   The Fresh Fruit and Vegetable Regulati ons and the Processed Products Regulations, 
made pursuant to the Canada Agricultural Products Act (Act), prescribe safety, quality, packaging and 
labelling standards for fresh and processed fruit and vegetables moving in ter-provincially or 
internationally. 
 
Processors, re-packers and wholesalers are free to s ource their supplies from the area and supplier of 
their choice, provided they comply with all the requirements of the Act and Regulations. 
 The Regulations also provide for the granting of Ministerial Exemptions from the quality, packaging 
and labelling standards in order to  alleviate a shortage in the av ailable supply of domestic production 
and facilitate orderly marketing.  (ix) Sanitary and phytosanitary measures   WT/TPR/M/179/Add.1 
 Page 251 
 
 
[Colombia Question 1] 
 
In Paragraph 118, a statement is made with respec t to the responsible authorities that provision is 
made at the federal, provincial and territorial government levels for examining and monitoring the 
various sanitary and phytosanitary measures, and that  provisions exist for the sharing of information 
between the various regulatory bodies in connection with a wide range of animal and plant-health 
matters, and also in connection with the safety of fo od products.  It is nevertheless not clear how the 
sanitary and phytosanitary control systems are mon itored at the provincial level.  What bodies are 
responsible for carrying out that function, and what  is their relationship with the Canadian Food 
Inspection Agency (CFIA)? 
 
ANSWER:   Federal regulations have ju risdiction with regards to international trade for SPS issues. 
Canada is not aware of any situation where a provinc ial measure was more restrictive than the federal 
measure.  Bodies responsible for fe deral regulations related to food saf ety and animal and plant health 
include the Canadian Food Inspection Agency, H ealth Canada, Agriculture and Agri-Food Canada, 
and Canada Border Services Agency. 
 
[Colombia Question 2] 
 
In Paragraph 121, it is stated that the federal re gulatory authorities are to  apply the applicable 
international standards, directives and recommendations , to the extent that such standards fulfill the 
objective of ensuring the degree of regulation sought by  Canada.  Otherwise, the CFIA carries out the 
pertinent risk analyses or requests assistance from th e Ministry of Health in that regard.  Do the 
Canadian authorities permit such risk analyses to be carried out by third parties?  If yes, what bodies 
are authorized to do so, and on the basis of what ac creditation system are they monitored?  And what 
regulatory body exercises supervis ory control in that regard? 
 
ANSWER:   Canada has allowed third parties to carry out  risk assessments in the past.  This may have 
been related to resource shortages and a solution by the government to continue to conduct risk 
analyses in a timely fashion.  Third-party risk assessments have been carried out by private companies and by universities.  These 
assessments are monitored and revi ewed internally by the federa l government before approval is 
granted.  
[Colombia Question 3] 
 In Paragraph 122, it is stated that the Canadi an Food Inspection Agency frequently concludes 
agreements with foreign governme nts in connection with specific products on the question of the 
safety of food products as well as the health of anim als and plant products.  Also included in this 
regard are memoranda of understanding  and protocols.  With respect to this matter, what procedures 
are followed for implementing such agreemen ts in relation to third-party countries? 
 
ANSWER:   Canada’s free trade agreements and me moranda of understanding do not provide for 
special or preferential treatment on SPS-related issues .  Therefore, they have no impact on countries 
that are not Party to the agreement or memorandum in question.  
[Colombia Question 4] 
 
In Paragraph 125, it is stated that the provinces on occasion carry out their own risk analyses with 
respect to phytosanitary issues fo r the purpose of determining the need for implementing provincial-
level measures, though they generall y rely on evaluations from federal bodies.  In this regard, does the 
CFIA verify or guarantee the findings of such ri sk analyses, and are these applied to third-party 
countries? WT/TPR/M/179/Add.1 
Page 252  
 
ANSWER:   The provinces may consult with the CFIA when conducting risk analysis on SPS issues.  
However, the CFIA does not have the mandate for fo rmal evaluations of provincial risk analyses for 
goods that do not leave a given province.  When goods cross national or provincial borders (for example, imports from other countries), federal regul ations have jurisdiction with regards to SPS 
issues. Canada is not aware of any situation where a provincial measure was more restrictive than the 
federal measure. 
 
[Colombia Question 5]  
In Paragraph 127, it is indicated that the evaluatio n of applications to import animals or animal-
derived products may, in cases where a risk analysis is required, take up to a year to process.  How 
does Canada guarantee that this evaluation process does not result in undue delays of a commercial 
nature if the timeframe is not defined in mandatory terms?  ANSWER:   The average process time for a risk assessment will vary from 3 months to a year.  This 
will depend on the type of information available from th e client and or the country.  If the officials or 
the client do not respond or do no t provide enough information to  our questions, it will delay the 
process.  The time frame required for a risk assessment could also be influenced by diversion of risk 
assessment resources due to disease outbreaks or national catastrophes.  For some commodities, once a favourable risk asses sment is completed and import conditions have 
been created, the commodity can then be imported, as long as the disease status of the country has not 
changed from the time the risk assessment had started.   If the disease status changes, the issuance of a 
permit could be delayed.  For other commodities, once the risk assessment is completed with a favourable outcome, a site visit/inspection may need to be carried out.  The time for this will depend 
on the availability of an inspector and the authorities of the exporting country. 
 
It is Canada’s goal to conduct risk analyses for imports in as timely a manner as possible.  A 
mandatory timeframe is impractical in nature, considering the differing levels of technical complexity 
relating to different pests or diseases, prospective volume of requests that could be made in a short 
time span, unforeseen emergency situations that  may divert resources away from recognition 
processes, and taking into account limited resources. 
 
[Colombia Question 6] 
 
Although the CFIA normally carries out its disease-rela ted risk evaluations on a national scale, it has 
on occasion agreed to recognize specific regions of a given country to be “disease-free,” as noted in 
Paragraph 128.  In this regard, what criteria and procedures are followed for the purpose of 
establishing regional criteria in the specific ca se of foot-and-mouth disease?  How long does the 
process take from the time an applica tion is submitted by an exporter country? 
 ANSWER:   The process is the same as what is outlined in Columbia Q 5.  The only difference where 
we consider only part of a country is that th e exporter country will have  to provide additional 
information with respect to the controls that th ey have put in place in order to establish a "zone" 
within their country.  As this is an add itional evaluation, it will increase the timeline. 
 The Canadian Food Inspection Agency (CFIA) would determine the degree of risk associated with a 
country or specific region of a country.  They woul d also determine what criteria and procedures were 
necessary to establish and maintain disease-free status.  A risk assessment may propose risk 
mitigation activities, but recommended activities to be implemented would vary on a case-by-case 
basis.   WT/TPR/M/179/Add.1 
 Page 253 
 
 
(3) M EASURES DIRECTLY AFFECTING EXPORTS  
 
(vi) Other measures affecting exports 
 [Argentina Question 9] 
 
Question on paragraph 176, page 79:   Could Canada provide more information about the “relief 
measures [that] address specific import-export scenarios”?  ANSWER:   In several instances goods may be imported temporarily for specific purposes fully or 
partially relieved of the customs duties and tax es, including the Goods and Services Tax (GST). 
Examples include simultaneous interpretation eq uipment imported for use at meetings of a non-
commercial nature conducted by international, na tional or provincial organizations; goods imported 
by non-residents for their use in the conduct of relig ious or revival meetings  (excluding consumable 
goods for sale) and lighting and sound equipment for use at a fair, exhibition or rodeo.  In all of these 
cases, the customs duties are fully relieved while th e GST is payable based on the length of time the 
goods are used in Canada.  
(iv) Export Finance, insurance, and guarantees 
 
[Bolivia Question 12] Paras. 156-158 
 
Question:   The report states that “ EDC's mandate is to  support and develop, directly or indirectly, 
Canada's export trade and Canadian capacity to enga ge in that trade and to respond to international 
business opportunities.  It offers various finan ce, insurance and guarantee programmes related to 
export transactions.” 
 
Could the Canadian delegation indicate what principl es are used as the basis for granting those credits 
so that they will not be considered subsidies?  ANSWER:   All of EDC’s financing transactions, both Canada Account and Corporate Account, are 
structured to comply with Canada’s WTO obligati ons and, as such, do not c onstitute prohibited export 
subsidies.  Transactions are either structured on market terms with appropriate benchmarks or are 
structured in conformity with the interest  rate provisions of the OECD Consensus.” 
 
(4) M
EASURES AFFECTING PRODUCTION AND TRADE  
 
(ii) Incentives and other assistance to business 
 (b) Federal measures and programmes  [Bolivia Question 10] Paragraph 199 
 The report mentions that “The Federal Government  provides a number of tax credits and deductions 
from Corporate Income Tax.  In the 2006 Budget, the Government also introduced a tax credit of up 
to Can$2,000 for employers who hire apprentices, as  part of a package of measures designed support 
a more skilled and educated workforce.”  
What is the scope of the training program and has the Government of Canada performed any 
evaluation of its impact on improving the quality and capacity of employees?  ANSWER:   Through Budget 2006, the Government of Canada announced major new investments to 
encourage apprenticeships and to sup port apprentices in their training. 
 WT/TPR/M/179/Add.1 
Page 254  
 
Both the Apprenticeship Job Creation Tax Credit and the Tradesperson’s Tools Deduction recognize 
the important contribution that apprenticeships and tradespeople make to the Canadian economy.  The 
Apprenticeship Job Creation Tax Credit, effective Ma y 2, 2006, provides employers a tax credit equal 
to 10 percent of the wages paid to  qualifying apprentices in the first two years of their contract, to a 
maximum credit of $2,000 per apprentice per year.  Qualifying apprentices are defined as those who 
are registered in apprenticeship programs in one of the 49 Red Seal trades.  Please refer to 
http://www.cra-arc.gc.ca/whatsnew/a pprenticeship-e.html for more details about this tax credit. 
 The tax credit, along with the Apprenticeship Incentiv e Grant, builds on the Interprovincial Standards 
Red Seal Program, which was established more th an 50 years ago, and represents a partnership 
between both levels of government.  The Red Seal  supports inter-provincia l mobility and promotes 
national occupational and training standards for the skilled trades.  It should be noted that 
apprenticeship training and certification is the so le responsibility of provincial and territorial 
governments.  Please refer to http://www.red-seal.ca/ for more information.  
Similarly, Budget 2006 introduced the new Tradesp erson’s Tools Deduction for tradespeople, which 
provides a deduction of up to $500 for the cost of t ools in excess of $1,000 that  they must acquire as a 
condition of employment.  This annual tax deduction for employed tr adespeople will help cover the 
cost of new tools necessary to their trade.  Check  http://www.cra-arc.gc.ca/whatsnew/tools-e.html for 
more information about this tax deduction.  
These tax-based measures are in addition to the ne w Apprenticeship Incentive Grant, which provides 
a taxable cash grant of $1,000 per year to register ed apprentices who have completed their first or 
second year in one of the 49 Red Seal trade programs,  on or after January 1, 2007.  More information 
about this program is available online at:  http ://www.hrsdc.gc.ca/apprenticeship.  Taken together, 
these measures provide a strong incentive for more  Canadians to pursue apprenticeships and hence 
meet the future need for skilled tr adespeople that is crucial to the sustained growth of the economy. 
 Given that these measures have only recently been im plemented, there has been no evaluation to date. 
 
IV. TRADE POLICY BY SECTION 
 
(2) A
GRICULTURE  
 [Argentina Question 4] 
 
Question 4 (a) on paragraph 1, page 31 and paragraphs 3, page 109 and 47 to 52, pages 122/123:  
Paragraph 1 mentioned above says that in the pe riod under review, no changes occurred in Crown 
corporations, including the Canadian Wheat Board.  Nevertheless, as mentione d in paragraphs 3 and 
49, a working group created by the Minister of Agriculture and Agri-Food published a report in October 2006 recommending the gradual elimination of the Board’s monopoly.  Could Canada report 
on whether it has decided to transform the Canadi an Wheat Board according to the report of the 
working group? 
 
ANSWER:   The working group or task force which is  mentioned was assigned to recommend options 
on the way forward to implementing marketing choice for wheat and barley.  The elimination of the 
monopoly was not a recommendation of the task force but rather was the policy objective which prompted the creation of the task force by the Gove rnment.  The task force was a team of experts in 
grain marketing, assigned to identify technical a nd transition issues regarding how the CWB could 
operate in a marketing choice environment.  The recommendations in the report are not government 
policy but will be considered along with other views and information as Government policy on 
transforming the CWB is developed.   WT/TPR/M/179/Add.1 
 Page 255 
 
 
Question 4 (b):   Also, could Canada provide more details on export credit programs, in particular the 
credit service for agricultural and agri-food prod ucts, the terms and conditions for advances, the 
percentage guaranteed by the government, repaymen t periods, interest rates and risk premiums? 
 ANSWER:   Canadian export credit/export credit guarantee programs operate through Export 
Development Canada (EDC) and through  the Canadian Wheat Board (CWB). 
 As Canada's official export credit agency, Export De velopment Canada's (EDC) mandate is to support 
and develop, directly or indirec tly, Canada's export trade and Canadi an capacity to engage in that 
trade and to respond to international business opport unities.  EDC provides a variety of insurance, 
guarantee and financing products to Canadian expor ters and investors.  It finances its activities 
through service fees, insurance premium and interest on loans.  The EDC products most used by agricultural an d agri-food exporters a nd financing banks are 
Accounts Receivable Insurance (ARI) and Document ary Credits Insurance (DCI).  ARI insures 
policyholder's accounts receivables against commercia l credit risk and political risks.  DCI protects 
banks in Canada confirming or negot iating irrevocable letters of credit (ILCs) issued by foreign banks 
to exporters of Canadian goods and services  Both of these products are underwritten on commercia l terms and are benchmarked against similar 
products available in the private sector.  Premiums are charged according to risk and are benchmarked 
against the private sector.  The maximum repaym ent terms supported unde r ARI generally do not 
exceed 180 days for agricultural products and the ma ximum repayment terms on the letters of credit 
supported under DCI do not exceed 364 days.  The typi cal insurance coverage for ARI is 90% and for 
DCI is 95% for agricultural products.  
Most CWB sales are on a cash basis; however, in certain cases, the Government of Canada provides 
export credit guarantees to the CWB, allowing it to ma ke credit sales to creditworthy buyers.  One 
credit guarantee program, the Credit Grain Sales Program (CGSP), nominally provides credit guarantees on credit sales to sovereign buyers with te rms of up to three years.  However, this program 
has not been used for new credit sales since the 2001/02 crop year.  Some old balances remain relating 
to sovereign debts which have been rescheduled. 
 
A second program, the Agri-Food Credit Facility (ACF), provides credit guarantees on CWB sales to private sector buyers.  While term limits are not set out by law or regulation, in practice, where ACF guarantees are granted, they relate to credits with  terms of up to one year with the Government 
guaranteeing 98% of the amount owing.  The inter est rate is negotiated between the CWB and its 
customer.  The Government does not charge a premium for the guarantee. 
 
[Argentina Question 5] 
 
Internal Assistance Programs 
 Question on paragraph 38, page 119:   Could Canada provide deta iled information on measures 
being taken to replace the Canadian Agricu ltural Income Stabilization (CAIS) Program? 
 ANSWER:   The Federal Government’s proposal for th e replacement of CAIS includes a combined 
package of a disaster relief framework, expanded pr oduction insurance, improvements to the margin 
based program, producer savings accounts and on-going assistance to address cost of production 
issues.  Further information on the proposed programs can be found at the following:  WT/TPR/M/179/Add.1 
Page 256  
 
News Release (March 9, 2007):  Prime Mi nister announces $1 billion for Canadian farmers 
http://www.pm.gc.ca/eng/media.asp?category=1&id=1566. 
 News Release (November 14, 2006):  Ministers Focus on Building a St ronger Future for Agriculture 
in Canada http://www.agr.gc.ca/cb/index_e. php?s1=n&s2=2006& page=n61114. 
 
[Argentina Question 6] 
 
Question on paragraph 41, page 120:   Concerning direct payments and general payments made in 
2006 under the Grains and Oilseeds Payments Program (GOPP), could you specify the reason for 
adopting 2000–2004 as the base period?  Also, coul d you say if there is a maximum amount per 
producer for both direct and general payments?  Finally, could you indicate what types of service are covered by general payments?  ANSWER:   Canada chose a recent base period (2000-2004) to ensure that beginning grains and 
oilseeds producers who recently entered the sector woul d be eligible for the direct payment.  Further 
details on the calculations and the structure of the GOPP payment per producer can be found at: 
http://www.agr.gc.ca/policy/income/gopp/faq.html.  
(iv) Export subsidies 
 
[Bolivia Question 13] Paragraph 44 
 
Question:   Canada adopted commitments to reduce export subsidies under the WTO’s Agreement on 
Agriculture, relating to 11 groups of products.  
Can you explain why export subsid ies have grown by 9% over the previous year, since the Implicit 
Agenda envisages a reduction and, if appropriate, the elimination of measures that distort international 
trade?  ANSWER:   Canada’s use of export subsidies is within  the commitment levels specified in the WTO 
Agreement on Agriculture.  Cana da is committed to the objec tives of the Doha Round of WTO 
negotiations, including the eliminati on of export subsidies.  In this respect, Canada is working closely 
with other WTO Members in support of successfully concluding these negotiations. 
 
(4) M
ANUFACTURING  
 
[Argentina Question 18] 
 
Question on Paragraph 83, page 132:   Could Canada specify whethe r there exist specific conditions 
for accessing the different types of government  assistance?  If so, what are these conditions?  
 ANSWER:   Assistance for contractors  consists of repayable loans offered to major companies to 
develop their new products. 
 Assistance for small-and medium-sized enterprises  (SMEs) is intended for all manufacturing 
companies in all industrial sectors regardless of ac tivity sector.  It consists of repayable loans to 
finance their Research and Development activiti es and capital projects that may be partially 
supported. 
 Assistance for labour development  is intended for companies with specific labour needs and is 
designed to ensure a better match between those needs and the various educational institutions. 
  WT/TPR/M/179/Add.1 
 Page 257 
 
 
Assistance for innovation and productivity  is intended for all manufacturing SMEs in all industrial 
sectors that want to increase their productivity by improving the skills of their workforce.  The 
purpose of the program is to develop specialized occupational training progr ams.  Strengthening ties 
with the federal government is designed to improve coordination between both governments’ 
interventions in support of the R&D activities of ma jor Quebec companies and to maximize spin-offs 
in Quebec from federal government military equipment procurement programs. 
 
[Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu Question 4] 
 Question on paragraph 89 of page 105:   It is noted that a number of tariff remission schemes 
pertaining to imports of textiles and clothing are in  operation.  The Canadian General Preferential 
Tariff (GPT) Programme, for example, accords preferential and differential treatment to Members of 
the WTO.  As we understand it, such products from a Least-Developed Country (LDC) can enjoy 
tariff-free preference when entering Canada if they are made from yarn or fabric from a GPT beneficiary. 
 
Because we have not been granted designated be neficiary status under the GPT programme, while 
other WTO Members such as Korea and Hong Kong that  are at a similar stage of development to 
ourselves are accorded such preferential treat ment, our exports to LDCs are affected. 
 We have some serious concerns in this respect .  In its Report “European Communities - Conditions 
for the Granting of Tariff Preferences to Developi ng Countries”, the Appellate Body concluded that 
“...the term ‘non-discriminatory’…does not pr ohibit developed-country Members from granting 
different tariffs to products originating in differe nt GSP beneficiaries, ...” and “In granting such 
differential tariff treatment, however, preference-granti ng countries are required, by virtue of the term 
‘non-discriminatory’, to ensure that identical treat ment is available to all similarly-situated GSP 
beneficiaries, that is, to all GSP beneficiaries that have the ‘development, financial and trade needs’ to 
which the treatment in question is intended to respond (emphasis added, see paragraph 173 of 
WT/DS246/AB/R).” 
 
In light of the above, we respectfully request that Canada grant us designate d beneficiary status under 
the GPT programme, in due recognition of the principle of non-discrimination. 
 
ANSWER:   Issues such as product and country coverage  may be considered the next time these 
unilaterally accorded tariff treatments are review ed. In 2004 Canada extended, for ten years, the 
General Preferential Tariff (GPT)  and the Least Developed Country  Tariff (LDCT).  When the 
programs were extended, no changes were made to them, including product or country coverage.  
Issues such as product and country coverage may be  considered the next time these unilaterally 
accorded tariff treatments are reviewed.  We note that Chinese Taipei has a GDP per capita, in 
purchasing power terms, comparable to that of many developed countries.  (FYI: the CIA World Factbook estimated GPT per capita on a purchasing power parity basis.  The 
following samples are taken from this publication.) 
 
 GDP per capita (PPP) 
U.S. $43,500 
Canada $35,200 
UK $31,400 
EU $29,400 
Taiwan $29,000 
New Zealand $26,000 
S. Korea $24,200 
Czech Republic $21,600 
 WT/TPR/M/179/Add.1 
Page 258  
 
(5) T
ELECOMMUNICATIONS  
 [Bolivia Question 11] Paragraph 115 
 
Question:   The report mentions that “In 2005, the CRTC issued a decision requiring all Canadian 
wireless telephone companies to implement wire less number portability in most of Canada …” 
 Has this decision been applied even  to operators who report that number portability is not technically 
feasible? And if so, have exceptions been made fo r those operators with r espect to the deadlines for 
complying with the decision? 
 
ANSWER:   Wireless number portability (WNP) was intr oduced in Canada on March 14, 2007, with 
obligations for the largest carriers in metropolitan areas.  Other wireless carriers were required to 
implement, at a minimum, the porting-out of customer s.  In addition, wireless number portability was 
also only mandated in geographical locations wher e wireline-to-wireline Local Number Portability 
(LNP) already exists, thus excluding many smaller telecommunications providers in rural and remote 
communities.  The Canadian Radio-television and Telecommunication Commission recognised that 
requests to introduce WNP in new locations may warr ant special consideration and invited the small 
local exchange carriers (SILECs) to file proposed implementation plan to address requests for use of 
competitor services in their territories.  The implem entation plans include certain details, such as 
when tariffs will be filed, the nature and cost basi s of those tariffs, how customer transfer procedures 
would be managed, the timing of the implementation of local competitor services, the start-up costs to 
implement local competition including LNP if approp riate and how those costs will be recovered, and 
any other implementation issues that may be unique to the particular SILEC.  
(8) A
IR TRANSPORT  
 
[China Question 21] 
 
Question:   Foreign investors’ shares in Canadian air lines are restricted to 25%.  Please explain the 
reasons for the above restriction.  
ANSWER:   Canada does not have a specified limit on the total amount of equity that foreign interests 
can hold in Canadian air carriers, save the 25 percent limit on voting interests and the statutory requirement that a Canadian air carrier be controlle d in fact by Canadians.  Other forms of foreign 
equity could include non-voting or variable votin g shares.  The Canadian Transportation Agency 
(Agency) is mandated to ensure that Canadian ai r carriers remain under the control of Canadians. 
 
The 25 percent limit on foreign ownership was implem ented, consistent with other major aviation 
nations at the time (e.g., the United Kingdom and the United States of America), to allow Canada to 
ensure that its air carrier s remained under national control.  This  is a statutory requirement in the 
Canada Transportation Act that air carriers be contro lled in fact by Canadians, and Canadian bilateral 
air agreements, as do all international air agreements , provide for nationality clauses that state that 
designated airlines be substantially owned and effec tively controlled by nationals of the designating 
State.  
[Costa Rica Question 21] 
 Question on paragraph 192:   According to the document, Ca nada has not bound consumption of 
aircraft repair and maintenance services abro ad under the GATS and retains the possibility of 
requiring carriers to use domestic repair and maintenance services.  Question 21 (a):   Does Canadian legislation specifically  prohibit Canadian carriers from consuming 
aircraft repair and maintenance services abroad?  WT/TPR/M/179/Add.1 
 Page 259 
 
 
ANSWER:   To ensure the highest level of compliance w ith technical standards, the general rule is 
that repair, overhaul and maintenance activities mu st be performed by Canadian-certified persons 
located in Canada or their sub-organizations located outside of Canada.  This rule applies even when 
the maintenance work is performed in a foreign lo cation, unless there is an agreement or technical 
arrangement with the civil aviation authority of th e country concerned.  For work performed on an 
aircraft outside of Canada, we do not normally tr eat foreign service providers as Canadian services 
providers since , due to the relative difficulty experienced by  foreign based organizations in complying 
with the Canadian requirements,  certification is not generally  given to service providers outside of 
Canada.  
Question 21 (b):   What are the existing restrictions for a foreign company seeking to establish itself 
in Canada and provide these services?  ANSWER:   An Approved Maintenance Organization is a company that has been issued a certificate 
authorizing the maintenance of specified aerona utical products or the provision of specified 
maintenance services.  The certification is availabl e to foreign persons when they are located in 
Canada.  The foreign company will have to meet  the same requirements as a Canadian company. 
 
[Costa Rica Question 22] 
 
Question:   According to the document, all maintenance and repair operations on  Canadian-registered 
aircraft must be carried out by approved organi zations.  The authorities note that “approved" means 
approved in accordance with the Canada Aviation Regul ations, or the regulatio ns of a foreign state 
that is party to an agreement or technical arrangeme nt with Canada.  In the absence of an agreement 
or arrangement, that maintenance may only be ca rried out by a foreign organization under the 
framework of a contract with a Canadian organi zation, provided that the Canadian organization 
carries out the necessary supervision to ensure compliance with the applicable regulations. 
 Question 22 (a):   What requirements apply to a contract between a Canadian and a foreign 
organization for providing these services?  ANSWER:   A Canadian AMO can arrange to provide direct oversight of the work of a foreign 
organization, and accept responsibility for its correct  performance.  It must be a condition of the 
contract that Canadian civil aviation authorities reta in the right to inspect the work of the foreign 
organization, which must be performed completely in accordance with Canadian requirements.  Question 22 (b):   Who regulates the relationship between the two organizations?  Must this 
contractual relationship be approve d by any Canadian authority? 
 ANSWER:   Canadian civil aviation authorities approve t hose aspects of the contract that would have 
a direct bearing on compliance with Canadian regulations.  
GOVERNMENT REPORT 
 
II. TRADE POLICY DEVELOPMENTS 2003-2006 
 
(3) T
HE WORLD ’S LARGEST TRADING RELATIONSHIP : CANADA – UNITED STATES  
 
[Bolivia Question 1] Paragraphs 48 and 57  
Question:   The Canadian Government’s report states that “Services exports totalled $35.9 billion in 
2005, with corresponding imports at $45.3 billion.”  It  also says that “…Under the NAFTA, Canada’s 
trade in services with the U.S. and Mexico has also increased (from $46.4 billion in 1994 to 
$82.7 billion in 2004), while there has also been a positive impact on investment.  The stock of WT/TPR/M/179/Add.1 
Page 260  
 
foreign direct investment in Ca nada reached $415.6 billion in 2005,  of which more than 64% came 
from our NAFTA partners.”  Could the Canadian delegation expand by  providing the following information? 
 
• How much does trade in services with the Un ited States amount to in terms of Canada’s 
GDP? 
 ANSWER:   In 2004, the last year for which complete  information on Canadian services trade with 
individual countries is available, Canadian services  exports to the United States and Mexico were 
equivalent to 2.84% of Cana dian GDP while services imports from those two countries were 
equivalent to 3.57% of Canadian GDP.  Thus, total,  or two-way, trade in services between Canada and 
the United States and Mexico combined were e quivalent to 6.41% of Canadian GDP in 2004. 
 
• What is the sector breakdown in your trade with the United States and Mexico? 
 The sectoral breakdown for Canada's 2006 merchandise trade
 with the United States and Mexico 
(combined) is as follows: 
 
 Exports Imports Two-way Trade 
Food and Agriculture  5.8 6.2 5.9 
Metals, Minerals, and Related  34.5 14.9 26.7 
Chemicals, Plastics, and Rubber  10.1 14.6 11.9 
Wood, Pulp, and Paper 9.2 4.7 7.4 
Leather, Footwear, Textiles, and Clothing  1.4 1.8 1.5 
M&E 12.0 25.8 17.5 
Transport. Equip. 22.7 25.3 23.7 
All Other 4.5 6.6 5.3 
 100.0 100.0 100.0 
 
(4) R EGIONAL AND BILATERAL INITIATIVES  
 b. Bilateral trade initiatives  [Bolivia Question 2] Paragraph 65 
 
Question:   “Canada and Chile also agreed on exte nded transparency commitments for certain 
procurements for which no market access commitments were made.  In  addition, since Canada’s last 
trade policy review, Canada and Chile have met on several occasions to discuss the development of 
financial services disciplines.”  
In preparing disciplines related to financial ser vices with Chile, were these services examined in 
relation to cross-border trade in services or in rela tion to investments or some other service modality? 
Are there plans to write a specific chapter on Financ ial Services, or what form will the commitments 
assumed in this regard take?  
ANSWER:   Canada and Chile have held discussions in  respect of developing a dedicated chapter on 
financial services to be integrated into the existing Canada-Chile Free Trade Agreement .  These 
discussions are well advanced, and the chapter being considered is largely modeled on the financial 
services provisions of the North American Free Trade Agreement . 
  WT/TPR/M/179/Add.1 
 Page 261 
 
 
ORAL QUESTIONS FROM MARCH 23, 2007 
 
CHINA QUESTION:   China asked for more information as a follow up to their written question on 
quantitative restrictions.  In particular, China ask ed for more information on the "Importation of 
Intoxicating Liquors Act" and the provisions that give provinces discretion regarding the sale/import 
etc of spirits. 
 ANSWER:   The Importation of Intoxicating Liquors Act can be viewed at: 
http://laws.justice.gc.ca/en/showdoc/cs/I-3///en?page =1.  In particular, section 3 describes the 
provinces discretion regarding the sale/import of spirits. 
 
DISCUSSANT QUESTION:   The Discussant asked a follow up question on used-vehicles:  "If a 
used-vehicle from a country other than the U.S. wa s originally designed, built and certified by the 
manufacturer to comply with Canadian safety st andards, can it be imported into Canada? If not, 
why?” 
 
ANSWER:  Under the Motor Vehicle Safety Act administered by Transport Canada, compliance with 
Canadian safety standards is the main criteria re gulating the importation of vehicles, whether the 
vehicle is new or used.  The importation of vehicl es into Canada is based on their compliance with 
Canadian safety requirements, not on the country of origin.  A vehicle originally designed, 
manufactured and certified by the original manufactur er to comply with Canadian safety requirements 
would be acceptable.  It would have to be confirmed that the vehicle has not been modified from those 
standards. For more information, please see:  http://www.tc.gc.ca/roadsafety/importation/impxus_e 
.htm.  
UPDATED RESPONSES/ADDITIONAL INFORMATION 
 
SECRETARIAT REPORT  IV. TRADE POLICIES BY SECTOR  (9) P
ROFESSIONAL SERVICES  
 
[US Question 14] Professional Services - Legal Services  
Paragraphs 197 and 198 on page 128 of the Secret ariat report states that “[f]oreign lawyers may be 
licensed as foreign legal consultants to provide legal advice only on the law they are permitted to 
practice in their home jurisdiction.”  Please provide  statistics for foreign lawyer consultants over the 
last five years, by province.  
Previous response:   Unfortunately, statistics for the other provinces are not immediately available, 
however, Canada can endeavour to obtain this informa tion to be forwarded to Members at a later 
date following the Trade Policy Review. 
 
Updated response: 
 
Alberta
:  There were no Foreign Legal Cons ultants (FLCs) in 2002, 2003, 2004. 
2005 – 1 FLC 
2006 – 3 FLCs 
 Newfoundland and Labrador
:  one over the last five years. 
 New Brunswick
:  None over the last five years. 
 WT/TPR/M/179/Add.1 
Page 262  
 
Ontario
:  Approximately 70 - 75 per year between 2001 to 2006. 
 British Columbia
: 
2002 - 10 FLCs 2003 - 12 
2004 - 20 
2005 - 21 2006 - 23  Prince Edward Island
:  None over the past five years. 
 
Quebec and the territories of Yukon, Northwest Terri tories and Nunavut do not have FLC regimes. 
 
[US Question 15] Professional Services - Accounting Services 
 Paragraph 203 on page 12 9 of the Secretariat report discusses Canada’s GATS commitments with 
respect to accounting services.  Please provide sta tistics for the presence of foreign accountants over 
the last five years, by province.  
Previous response:   For the Chartered Accountant (CA) designation, at the moment we have statistics 
available for 2006 only; for foreign accountants who passed the examination in order to qualify as 
Canadian Chartered Accountants.  58 foreign accountants passed the 2006 CA Reciprocity 
Examination (CARE).  This examination is writte n by members of designated accounting bodies 
outside Canada. Of the 58 successful writers, 38 ar e from Ontario, 13 from British Columbia, 3 from 
Alberta, and 4 from Quebec.  The professional desi gnations of the successful writers were from the 
United States, England and Wales, South Africa, Ireland, Australia and Japan. 
 
For the Certified Management Accountant (C MA) and Certified General Accountant (CGA) 
designations, unfortunately specific statistics are not immediately available.  However, Canada can 
endeavour to obtain this information to be forw arded to Members at a later date following the Trade 
Policy Review.  
Updated response: 
 
Province/Territory 2000 2001 2002 2003 2004 2005 
Financial Auditors and Accountants       
Newfoundland and Labrador -- 0 -- -- -- 7 
Prince Edward Island 0 -- 0 0 0 0 
Nova Scotia -- 6 -- -- -- -- 
New Brunswick -- 0 -- -- -- -- 
Quebec 73 61 62 58 64 68 
Ontario 262 220 171 176 302 340 
Manitoba 6 7 -- 6 5 11 
Saskatchewan 5 8 9 5 7 6 
Alberta 52 43 34 37 81 97 
British Columbia 64 67 35 53 63 81 
Northwest Territories 0 -- 0 -- 0 0 
 
[EC Question 61] 
 
Canada provides for the right to practice as a Fore ign Legal Consultant (FLC) in Saskatchewan and 
Ontario without meeting normal accreditation requireme nts if the FLC has practiced the law of his/her  WT/TPR/M/179/Add.1 
 Page 263 
 
 
country for at least three complete years in th e case of Saskatchewan and for at least the five 
preceding years in the case of Ontario.  Question:   Could Canada explain what requirements have to be met by Canadian citizens (lawyers or 
non-lawyers) in order to provide advice on fo reign and international law in Ontario and 
Saskatchewan? 
 
Previous Response:   In Ontario, anyone who wishes to give legal advice about the law of a foreign 
jurisdiction must be licensed as a Foreign Legal Consultant.  The criteria for a license include 
membership in good standing in the law society of  the home jurisdiction and each other jurisdiction 
where the applicant is or has been a member.  La wyers who are not also members of the Ontario bar 
must have at least three of the previous five years experience in their home jurisdiction or they will 
require a supervising lawyer.  Lawyers are also required to have errors and omissions insurance 
equivalent to what is required of members of th e Ontario bar.  They must undertake not to open a 
trust account or in any way do work that is relat ed to Ontario/Canadian law unless they are members 
of the bar here as well.  There is no provision for anyone who is not a lawyer to provide legal advice 
in Ontario.  An answer on behalf of the law so ciety for the jurisdiction of Saskatchewan is not 
available at present, but Canada will endeavour to  obtain this information to be forwarded to 
Members at a later date following the Trade Policy Review.  
Additional information:   In order to provide advice on foreign law in Saskatchewan, a person must 
be licensed as a Foreign Legal Consultant and qualifie d to practise law in a country other than Canada 
or in an internal jurisdiction of that country.  The person must be a member in good standing of the legal profession in the jurisdiction of the law in wh ich they wish to practise, and carry a professional 
liability insurance or a bond, indemnity or other security.  Lawyers who are not also members of the Saskatchewan bar must have practised the law of th at foreign jurisdiction for at least three years or 
they will require a supervising lawyer.  A member of the Law Society of Saskatchewan who is also 
qualified to practise law in another country or in one  of its internal jurisdictions need not obtain a 
permit to act as a Foreign Legal Consultant in Saskatchewan, provided his or her activities as a 
consultant are insured against in a form and amount which is at least reasonabl y comparable with that 
maintained by the Society in its compulsory program .  There is no provision for anyone who is not a 
lawyer to provide legal advice in Saskatchewan. 
 
[China Question 23]  Architectural and engineering services  
 
Anyone who wants to engage in architectural services must obtain a license for a provincial or 
regional architect association. An applicant must pass qualifications test. 
 
Could Canada provide the information on how many applications from foreigners have been 
approved, how many have been rejected since 1995 until now?  Previous Response:   Statistics are not immediately available; however, Canada can endeavour to 
obtain this information to be forwarded to Members at a later date following the Trade Policy 
Review. 
 Updated response: 
 
A foreign architect must first have their academic qualifications assessed by the Canadian 
Architectural Certification Board (CACB) as a pa rt of the licensing process.  The CACB assesses 
educational qualifications of foreign architect app licants and either certifies them, identifies required 
courses they must take before they can be accredited,  or if the applicant requires additional training in 
one particular area only allows them to start the licensure process while they are completing courses. 
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Page 264  
 
The table below illustrates the number of  foreign applications the CACB has received  since 1995, the 
number of applicants who were certified , the number of applicants who were required to take courses  
and those who were granted provisional status  subject to completing course(s) in a particular area. 
These statistics are fluid, meaning that, for example,  depending on when the application was received 
and how long it took the applicant to complete th e requirements, they may not have been certified 
until the following year.  To note – statistics fro m 1995 – 2000 were less readily available and 
therefore less reliable.  Once a foreign architect has been certified, they mu st then meet additional licensing requirements in 
order to obtain a license in the province or territory in which they plan to practice. 
   WT/TPR/M/179/Add.1
 Page 265THIS TABLE IS PART OF THE RESPONSE FOR CHINA QUESTION 23 
 
 
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