Report

DELEGATION MEMBERS AND STAFF

From 28–30 September 2014, Mr. Gord Brown, M.P., Co-Chair and the Honourable Wayne Easter, P.C., M.P., Vice-Chair represented the Canadian Section of the Canada-United States Inter-Parliamentary Group (IPG) at the fall meeting of the Canadian/American Border Trade Alliance (Can/Am BTA) in Washington, D.C. Mr. Brown and Mr. Easter addressed the meeting’s participants. The delegation was accompanied by Ms. June Dewetering, Senior Advisor to the Canadian Section.

THE EVENT

The Can/Am BTA holds two meetings each year: in the spring in Ottawa and in the fall in Washington, D.C. As a coalition of businesses, public-sector organizations and individuals with an interest in bilateral trade and tourism, its mission is to maximize commercial activity and ensure continued growth in cross-border trade, as well as efficient and productive border-crossing capabilities.

Attendees at the event included private-sector representatives involved in a number of tourism, transportation and trade-related activities, as well as representatives of a variety of U.S. and Canadian federal departments.

DELEGATION OBJECTIVES FOR THE EVENT

The Canadian Section of the IPG has a long association with the Can/Am BTA, and members of the Canadian Section sometimes attend both its fall and its spring meetings. Given the Can/Am BTA’s focus, attendance at the meetings provides members of the Canadian Section with an important opportunity to gain insight about problems being experienced by businesses and individuals in respect of trade and tourism, as well as about efforts and actions by governments in both countries to address these problems.

At this meeting, Mr. Brown and Mr. Easter benefitted from their interaction with private- and public-sector organizations and individuals who deal with border issues on a daily basis. Attendance at the Can/Am BTA meetings also provides the Canadian Section with an opportunity to inform others about the range of actions taken by it in respect of shared bilateral goals, especially through the invitation that is typically given to the Canadian Section’s Senate and House of Commons Co-Chairs and/or Vice-Chairs to make remarks about the Canadian Section’s activities and priorities.

ACTIVITIES DURING THE EVENT

Members of the Canadian Section were able to speak with attendees about the problems being encountered at Canada’s shared border with the United States, and to share information about the efforts being taken by them to ensure the existence of an efficient, cost-effective and secure common border. The Canadian Section’s House of Commons Co-Chair, Mr. Gord Brown, M.P., spoke about the Canadian Section’s activities since the Can/Am BTA’s spring meeting, while Mr. Easter discussed the Canadian Section’s upcoming activities.

Sessions with the following titles were held:

·         Customs and Border Protection: Trade Relations, Expediting Low-Risk, Beyond the Border CBP Priorities and Initiatives

·         International Trade Data System, Partner Government Agencies and Single Window Initiative

·         Federal Highway Administration: Transportation & Border Related Priorities/Initiatives

·         The Canadian Perspective

·         Field Operations: Customs and Border Protection – Overview of new CBP initiatives, U.S. Canada Border Issues and Priorities

·         View from Alberta: Alberta Update – Including Oil Sands, Energy Market Access and Insight

·         View from the Hill and White House on Canada/U.S.

·         Air Passenger Processing: Automated Passport Control, eTA/ESTA debacle,  Security Screening

·         North America Trade Corridors Council

·         A Border Crossing Environmental Status – New Reality

·         BTB Perimeter Action Plan: View from Can/Am BTA

·         Canada/U.S. Inter-Parliamentary Group: Observations and Priorities

·         View from Congress: Issues Affecting the U.S./Canada Border

·         Canada/U.S. Insights: Issues, outlook, impacts, upcoming U.S. midterm election and its implications on Canada.

This report summarizes presentations at the meeting, including the remarks made by Mr. Brown and Mr. Easter.

CUSTOMS AND BORDER PROTECTION: TRADE RELATIONS, EXPEDITING LOW-RISK, BEYOND THE BORDER CBP PRIORITIES AND INITIATIVES

Gil Kerlikowske, U.S. Department of Homeland Security

·         The trade and tourism relationships between Canada and the United States are important to both countries.

·         Canada and the United States, including the Canada Border Services Agency (CBSA) and the U.S. Department of Homeland Security’s Customs and Border Protection (CBP), are good partners; that said, the CBSA and the CBP need resources in order to “do their job.”

·         While security is “at the core” of the CBP’s activities, it is recognized that the security focus has two “prongs”: security against threats to the United States; and economic security.

·         The CBP is working hard to identify “smart” ways of operating, and of moving goods and people more quickly, efficiently, cost-effectively and securely.

·         The CBP has “lots of boots on the ground,” and they are in many locations.

·         The Global Entry program now has more than 1 million members, and Global Entry kiosks have been used on more than 9 million occasions.

·         In terms of moving goods and people, technology should be used to the greatest extent possible.

·         There are 10 Centers of Excellence and Expertise (CEE), although some are not yet operational.

·         Global supply chains are increasingly complex, and if someone has seen one supply chain, that person has seen one supply chain.

·         U.S. leadership is needed regarding the harmonization of rules and regulations; it is important that the United States work with other countries and in a manner that is not perceived as “the heavy hand of the United States.”

·         In February 2014, the single window initiative designed to streamline the export/import process in the United States was created by Executive Order.

·         While the Beyond the Border (BTB) Action Plan has resulted in some key accomplishments, a number of issues require work, including privacy rights in Canada and the United States.

·         The United States is facing “dire consequences” regarding infrastructure funding.

·         Cargo pre-inspection pilot projects under the BTB Action Plan are currently being evaluated and “lessons learned” are being identified.

INTERNATIONAL TRADE DATA SYSTEM, PARTNER GOVERNMENT AGENCIES AND SINGLE WINDOW INITIATIVE

Brenda Smith, U.S. Department of Homeland Security

·         Deadlines in relation to Automated Commercial Environment (ACE) start in 2015; two key dates are 1 May 2015, which is the deadline for the advance filing of electronic export and import manifest data, and 1 November 2015, which is the date by which all data associated with the release of cargo must be transmitted through ACE-enabled systems.

·         The Obama administration’s focus on economic prosperity and jobs, and the role that trade facilitation plays in those two areas, has been transformative.

·         The single window initiative, which exists as a result of a February 2014 Executive Order, presents significant opportunities to examine what is done, how it is done and why it is done; in particular, the focus is automation of the trade process and harmonized requirements across federal agencies.

·         The goal is good, fast, risk-based decisions about people and goods.

·         Of almost 50 partner government agencies (PGAs), between 12 and 15 are key because they make decisions about cargo at the United States’ borders.

Tim Skud, U.S. Department of the Treasury

·         In terms of operationalizing the International Trade Data System (ITDS), the goal is an electronic filing option for more than 140 import forms and more than 40 export forms.

·         People are seeking reduced transaction costs at the United States’ shared borders.

·         The ITDS eliminates redundancies; as a number of forms request some of the same information, the focus should be on submitting “marginal” or “extra” information, as required.

·         Hopefully, the ITDS will lead to two outcomes: more effective enforcement at the border, so that legitimate trade flows more easily; and more successful rates of interdiction.

·         The World Customs Organization has a model for the electronic processing of shipments, and international standards in this regard should be adopted.

FEDERAL HIGHWAY ADMINISTRATION: TRANSPORTATION & BORDER-RELATED PRIORITIES/INITIATIVES

Greg Nadeau, U.S. Federal Highway Administration

·         The U.S. Department of Transportation takes the Canada-U.S. relationship very seriously; the two countries have the most important trading relationship in the world, and they share a interest in perimeter security and economic competitiveness.

·         The United States needs infrastructure – including along the Canada-U.S. border – to support a growing population and an expanding economy; in particular, a long-term infrastructure investment plan is needed to connect America and to connect America with its allies.

·         Innovation should be a focus in order that investments in infrastructure last as long as possible.

·         The Generating Renewal, Opportunity, and Work with Accelerated Mobility, Efficiency, and Rebuilding of Infrastructure and Communities throughout America Act – or GROW AMERICA Act – would provide $302 billion in spending over four years for surface transportation, and would build the foundation for a growing economy; the proposed legislation is a “bridge” to where the United States “needs to go,” including in relation to a long-term and sustainable infrastructure funding plan.

·         At present, the United States is 27^th worldwide in terms of the proportion of gross domestic product invested in infrastructure; at one point, the country was ranked 7^th, if not higher.

·         In the United States, there must be a commitment to long-term rebuilding of the nation’s infrastructure as a foundation for the future.

·         Strategic investments are needed in highways, bridges, ports and airports to ensure that goods and people can be moved efficiently and safely.

·         A North American transportation system is needed.

·         The BTB Action Plan was a catalyst for cooperative and innovative initiatives, including the border wait times initiative.

·         A waiver from Buy American requirements regarding steel and iron has been gained in relation to the construction of the new international crossing at Detroit, Michigan and Windsor, Ontario; such a waiver is a rare occurrence.

·         President Obama’s 2010 National Export Initiative (NEI) provided a focus on strategic gateways and trade corridors; exports create jobs.

THE CANADIAN PERSPECTIVE

Gilles Gauthier, Canadian Embassy

·         Initiatives that would make the economic relationship a “success story” for both nations should be supported; these initiatives include the Keystone XL pipeline.

·         Many Americans, including policy makers, do not know that Canada is the United States’ largest trading partner.

·         Implementation of the BTB and Regulatory Cooperation Council Action Plans will enable Canada and the United States to increase trade while respecting security imperatives.

·         Canada and the United States are in the “home stretch” regarding a comprehensive agreement in relation to pre-clearance.

·         The NEXUS program now has more than 1 million members.

·         Canada and the United States are focused on reducing border wait times, ensuring that risks are properly assessed, and facilitating the movement of legitimate goods and people across the shared border.

·         A North American transportation plan would facilitate the movement of goods and people within the continent.

·         In both Canada and the United States, there are new requirements in relation to the transportation of petroleum products.

·         Significant progress is being made regarding the construction of the new crossing at Detroit, Michigan and Windsor, Ontario, which will be overseen by an independent board; Buy American requirements in relation to the steel used in the crossing’s construction are being waived.

·         At present, a number of irritants exist between Canada and the United States, including: the United States’ country-of-origin labelling requirements, which are inconsistent with an integrated livestock market in North America; the proposed increase in the U.S. Department of Agriculture’s Animal and Plant Health Inspection Service (APHIS) fees, which would disproportionately affect trade with Canada; and Buy American provisions, which were contained in 163 bills in the last Congress.

FIELD OPERATIONS: CUSTOMS AND BORDER PROTECTION – OVERVIEW OF NEW CBP INITIATIVES, U.S. CANADA BORDER ISSUES AND PRIORITIES

John Wagner, U.S. Department of Homeland Security

·         The goal of the CBP is to move people and goods across the United States’ borders more quickly, efficiently and safely.

·         The Global Entry program is expected to have 2 million members by the end of December 2014, and Global Entry kiosks have been used on more than 11 million occasions.

·         The NEXUS program has more than 1 million members.

·         Travellers should be “separated” or “segregated” on the basis of risk analysis and “facilitating documents.”

·         Passenger travel to the United States continues to increase.

·         Customs-Trade Partnership Against Terrorism, which has existed since November 2001 and is designed to secure supply chains, is one of the oldest trade initiatives; secure supply chains “bolster” economies.

·         The CBP is working with PGAs to streamline duplicative processes.

·         Businesses seek clarity and consistency.

·         The 10 CEEs, which are focused on specific sectors, are important for reasons that include the protection of intellectual property rights, import safety, commercial fraud and anti-dumping.

·         The BTB Action Plan’s early accomplishments are continuing, and lessons are being learned through evaluation of pilot projects; working is ongoing in relation to pre-clearance, integrated cargo security, in-transit shipments and making information about wait times publicly available.

VIEW FROM ALBERTA: ALBERTA UPDATE – INCLUDING OIL SANDS, ENERGY MARKET ACCESS AND INSIGHT

Rob Merrifield, Government of Alberta

·         Canada and the United States have the world’s greatest trade relationship and many integrated supply chains; as the world is unstable, it is important that this relationship not be taken for granted.

·         Canada and the United States have the two richest middle-classes in the world, and the two countries can “do better together” than when they take actions independently.

·         Developed countries should help developing countries become independent in terms of energy and food.

·         The province of Alberta has abundant energy and other natural resources.

·         The delays in approving the Keystone XL pipeline seem to be linked to “politics,” rather than to the pipeline itself; at present, 84 pipelines cross the Canada-U.S. border.

·         Pipelines are the safest and most energy-efficient method of transporting hydrocarbons.

·         Energy is not an end in itself, but rather a catalyst for productivity and opportunity.

·         Current polls suggest that more Americans than Canadians support the Keystone XL pipeline.

·         When the United States buys Canadian oil, $0.90 of every $1 goes back into the U.S. economy, an amount that exceeds the $0.33 in relation to Saudi Arabian oil.

·         Energy independence is critical, but energy output needs to be increased in an environmentally responsible manner.

·         The province of Alberta has a carbon tax; the revenue associated with that tax is placed in an environmental fund.

·         Alberta’s oil companies are “massively” competitive with each other; that said, they share technology that leads to cleaner air, land and water, as well as reduced greenhouse gas emissions.

·         The United States’ country-of-origin labelling requirements are an example of protectionism, and they are inconsistent with the country’s international trade obligations; the United States’ reputation is being hurt by its failure to respect World Trade Organization decisions.

·         The comprehensive economic and trade agreement reached between Canada and the United States makes NAFTA “look like a relic.”

VIEW FROM THE HILL AND WHITE HOUSE ON CANADA/U.S.

Peter Friedmann, Lindsay Hart LLP

·         The U.S. Congress passed few bills prior to leaving Washington, D.C. on 19 September 2014 to begin campaigning and fundraising in states and Congressional districts prior to the mid-term elections in November 2014; a limited number of Congressional districts are “in play.”

·         When Congress returns for a “lame duck session,” the focus may include the following: passing the federal budget; finalizing a transportation bill; reauthorizing funds for the Export-Import Bank of the United States; voting on U.S. engagement in Syria; considering whether trade promotion authority will be given to the President; and addressing inversions, perhaps through reform of the U.S. tax code.

·         The outcomes of the mid-term elections in the United States will affect the United States’ relationship with Canada, and the outcomes in the U.S. Senate will be particularly important.

·         Impediments to the economic relationship between Canada and the United States are not the result of one private-sector interest seeking an advantage over another private-sector interest, but rather of decisions made by the Executive Branch in the United States; examples include the proposed increase in the U.S. Department of Agriculture’s APHIS fees and the United States’ country-of-origin labelling requirements.

·         Regarding the Trans-Pacific Partnership (TPP) negotiations, the United States and Canada have different priorities, but the two countries “are in the same boat” in terms of their concerns about Japan.

AIR PASSENGER PROCESSING:  AUTOMATED PASSPORT CONTROL, eTA/ESTA DEBACLE, SECURITY SCREENING

Gerry Bruno, Vancouver Airport Authority

·         Many BTB initiatives are completed or are nearing completion, and consideration is now being given to “BTB 2.0.”

·         Approximately 25-30% of cargo, by value, enters North America by air; as well, foreign tourists generally enter by air.

·         Airports have two borders that happen to be co-located.

·         Border and security challenges are “major hassles” for air travellers.

·         Key BTB objectives include eliminating duplicative efforts by Canada and the United States, and implementing pre-clearance for all modes of transportation.

·         Opportunities exist in relation to greater automation, electronic travel authorization and improved security screening.

·         BTB 2.0 should focus on eliminating duplicative security screening for transborder passengers, establishing a single window for electronic travel authorization/electronic system for travel authorization (eTA/ESTA), harmonizing eligibility and processes, and making it easier for legitimate travellers to cross the shared border.

Kevin Burke, Airports Council International

·         Regarding the air mode of transportation, key priorities include harmonization, reciprocity and airport financing.

·         Travellers should be provided with tools to ease and expedite the travel experience.

·         Productive relationships with regulators are needed in order to resolve problems that arise.

·         The BTB Action Plan enhances security and trade facilitation, and improves the travel experience.

·         Redundancy, which is costly, should be reduced.

·         The focus should be building on existing risk-based initiatives.

NORTH AMERICA TRADE CORRIDORS COUNCIL

Bruce Agnew, Cascadia Center

·         The “story” of North America in terms of trade corridors is the story of Mexico’s emergence as an “economic power,” in respect of which the energy reforms in Mexico are key.

Leslie Blakey, Coalition for America’s Gateways & Trade Corridors

·         The energy “boom” is placing demands on, and creating opportunities for, transportation.

·         North American “dynamics” include: population growth and demographic change; low-cost energy and raw materials; supply chain efficiency and freight mobility; large and growing consumer markets; environmental sustainability; social justice issues; and education in science, technology, engineering and mathematics, as well as workers trained in these areas.

·         There is general agreement that NAFTA has “worked,” and the three NAFTA countries continue to “make things” together.

·         A long-term vision for freight mobility, energy and the environment is needed.

A BORDER CROSSING ENVIRONMENTAL STATUS – NEW REALITY

Ron Rienas, Buffalo & Fort Erie Public Bridge Authority

·         Efforts are being made to reduce diesel emissions at border crossing points, and many of the new trucks have technology that results in reduced emissions.

·         Truck traffic between Canada and the United States has declined over the last 15 years, and car traffic has been declining since 1999.

·         Infrastructure at border crossing points may be sufficient, but inadequate staffing may lead to congestion.

BTB PERIMETER ACTION PLAN: VIEW FROM CAN/AM BTA

Jim Phillips, Canadian/American Border Trade Alliance

·         With a number of accomplishments realized as a result of the BTB Action Plan, the focus is shifting to BTB 2.0 and Beyond BTB 2.0.

·         It is expected that the December 2014 progress report in relation to the BTB Action Plan will identify action items that have been completed and the activities that are required to complete remaining action items.

·         Threat and risk assessments by mode of transportation should occur.

·         “Big data” should be available in a form that enables predictive analysis.

·         The goal should be seamless management of the shared border.

CANADA/U.S. INTER-PARLIAMENTARY GROUP: OBSERVATIONS AND PRIORITIES

Gord Brown, Canadian House of Commons

·         While some members of the Canadian Section of the Canada-United States Inter-Parliamentary Group (IPG) were attending the Can/Am BTA’s Ottawa meeting in May 2014, other members were at the annual conference of the Southeastern United States-Canadian Provinces (SEUS-CP) Alliance; with its typical focus on trade and investment, conference participants attended business-to-business meetings and discussed three issues that will benefit North American businesses: new technologies that can facilitate cross-border trade; cleantech; and advanced manufacturing.

·         The Canadian Section’s next activity occurred in early June 2014, when Canada hosted the IPG’s annual meeting in Ottawa, with six Canadian Senators, seven members of the House of Commons, five U.S. Senators and four members of the U.S. House of Representatives attending; the annual meeting involved plenary sessions on three topic areas: water and energy; international affairs; and trade.

·         Following the IPG’s annual meeting, members of the Canadian Section attended the summer conference of the Western Governors Association (WGA); roundtable discussions were held on a number of topics, including some that are also of interest to Canada, such as drought, flooding, water, oil and gas, fires, endangered species and invasive plant species.

·         In July and August 2014, delegations from the IPG’s Canadian Section attended the national and regional meetings of the Council of State Governments (CSG),  and had an opportunity to speak at the collaborative meeting between CSG-National and CSG-WEST; in particular, an IPG Vice-Chair spoke twice at that meeting: about emergency preparedness and response; and about selected Arctic issues.

·         At the Midwestern and Eastern CSG meetings, members of the Canadian Section supported their provincial counterparts as resolutions were discussed; at the Eastern Regional Conference meeting, a resolution urged the federal governments in the United States and Canada to reach agreement on permanent truck cargo pre-inspection and pre-clearance operations at the Peace Bridge, with the extension of both to other major truck freight crossings, while a resolution urging reconsideration of the proposed fee increases by the U.S. Department of Agriculture’s APHIS, as well as a continued movement to pre-clearance inspections and other measures based on a reasonable risk assessment, was introduced at the Midwestern CSG meeting.

·         Members of the Canadian Section also attended the National Conference of State Legislatures, which always has presentations on a very broad range of public policy issues; one of the Canadian Section’s Vice-Chairs made a presentation about the energy relationship shared by Canada and the United States, and about the safe movement of hydrocarbons.

·         In July and August 2014, the Canadian Section’s members attended the national meeting of governors, and the regional governors’ meetings in the Northeast and South; opportunities to speak with state governors are invaluable, as members are able to talk about the nature and scope of the relationship between Canada and the particular states, and to highlight bilateral trade, tourism and other relevant issues.

·         Members of the Canadian Section attended the summer meeting of the Pacific NorthWest Economic Region; two delegates provided remarks, with one focusing on the safe movement of hydrocarbons, and the other speaking about the negative effects of protectionism and the various ways in which it manifests itself, including through Buy American provisions.

Wayne Easter, Canadian House of Commons

·         One of the first activities on the Canadian Section of the IPG’s future agenda is a meeting with the United States’ ambassador to Canada, Ambassador Bruce Heyman; the Canadian Section generally tries to meet with the United States’ ambassador to Canada periodically in order to discuss bilateral issues, both areas where the countries can work together – or work more closely together – and where the two nations need to resolve differences of opinion, such as with – for example – the Buy American provisions that harm Americans because of their impact on supply chains, and the country-of-origin labelling requirements that are inconsistent with the North American livestock market.

·         NAFTA is celebrating its 20^th anniversary this year and, perhaps because of this anniversary, some commentators and analysts are discussing whether it is time to revitalize trilateralism; members of the U.S. House of Representatives will be hosting their Mexican counterparts in Washington in December 2014, which may present the Co-Chairs of the Canadian Section with an opportunity to explore whether a trilateral format – a Canada–United States–Mexico inter-parliamentary group – would be beneficial.

·         At the Can/Am BTA’s May 2014 meeting in Ottawa, it was indicated that the Canadian Section had a meeting with Nevada Governor Brian Sandoval – incoming chair of the WGA – in spring 2014 when he led a trade mission to Canada; at that meeting, Governor Sandoval agreed that the Canadian Section’s House of Commons Co-Chair would be able to speak at the WGA’s winter meeting.

·         The final two activities in which the Canadian Section may participate before the Can/Am BTA’s meeting in Ottawa in May 2015 is the February 2015 meeting of the National Governors Association, to be followed by meetings with federal legislators on Capitol Hill; Congressional visits held shortly after U.S. elections enable members of the Canadian Section to begin a dialogue with newly elected members about the IPG and about the Canada-U.S. relationship.

VIEW FROM CONGRESS: ISSUES AFFECTING THE U.S./CANADA BORDER

Representative Bill Huizenga, U.S. House of Representatives

·         The United States’ northern border with Canada is often “undercast” in its performance – including in relation to security – and its importance to the United States.

·         Conversations between federal legislators in the United States and Canada are facilitated by the Canada-United States IPG, which had a very successful annual meeting in June 2014 in Ottawa.

·         Discussions are occurring about the possibility of a meeting among federal legislators from the United States, Canada and Mexico.

Representative Bill Owens, U.S. House of Representatives

·         The relationship that the United States has with Canada is very important to U.S. border communities, in part because of resulting economic development opportunities.

·         There are great opportunities for business activity on both sides of the Canada-U.S. border associated with increased involvement in supply chains.

·         NAFTA has a very positive impact in all three NAFTA countries, but there is some question about how NAFTA “goes forward” in light of the TPP negotiations, the comprehensive economic and trade agreement between Canada and the European Union (EU), and trade negotiations between the United States and the EU.

·         In the context of the trade relationship between Canada and the United States, which has an estimated annual value of $1.3 trillion, the investment in infrastructure can be characterized as “peanuts.”

·         A fluid, yet secure, border between the United States and Canada is needed.

CANADA/U.S. INSIGHTS: ISSUES, OUTLOOK, IMPACTS, UPCOMING U.S. MIDTERM ELECTION AND ITS IMPLICATIONS ON CANADA

David Wilkins, Nelson Mullins

·         The United States and Canada have the best relationship in the world; the outcomes of the November 2014 mid-term elections in the United States will affect that relationship.

·         The November 2014 elections will decide whether the Democrats or Republicans will control the U.S. Senate and House of Representatives during the last two years of the Obama administration; the outcomes of the Senate elections are especially important.

·         The incumbent President’s approval rating affects his party’s electoral outcomes.

·         Voters use the mid-term elections to register their approval or disapproval of the President.

·         Voters do not like the U.S. Congress, but they like their Congressional representative.

 

Respectfully submitted,