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The Society for Standards Professionals

The Role of Standardization in the Canadian Free Trade Agreement (CFTA)

Stephen Head, Manager, Strategic Policy and Sector Engagement

Standards Council of Canada

©2017 SES - The Society for Standards Professionals

The Standards Council of Canada (SCC)

• Federal Crown Corporation established in 1970:

– Reports to Parliament through the Minister of Innovation, Science and Economic Development (ISED)

– Canada’s national standards & accreditation body

• Mandate to:

– Coordinate standardization activities in Canada

– Accredit Standards Development Organizations & Conformity Assessment Bodies

– Approve National Standards of Canada

– Advise federal and provincial governments

– Support strategic priorities of industry and governments

– Represent Canada in international and regional forums©2017 SES - The Society for Standards Professionals

Canadian Regulatory & Standardization System

• Under the Canadian constitution there is a division of powers between the federal and provincial and territorial governments.

• Federal government has jurisdiction over certain areas such as defense and communications.

• Provinces and territories have jurisdictional authority over others, such as education, health, and electrical safety.

• Thousands of standards referenced in federal & provincial/territorial regulations.

• Canada’s federal structure means standards-development has traditionally been “bottom-up,” not “top-down.”


Agreement on Internal Trade (AIT)

• The AIT came into force in 1995 and focused on reducing trade barriers within eleven sectors, including labour mobility, agricultural and food products, natural resources processing, and transportation.

• The AIT was envisioned as an evolutionary process that would require ongoing negotiation and adjustment in order to further liberalize trade.

• The AIT did not keep pace with provisions made in international agreements and the increasingly competitive global environment.

• In 2014, Canadian First Ministers began negotiations on the renewal of the AIT.


Canadian Free Trade Agreement (CFTA)

• CFTA advances Canada’s internal trade framework: aims to enhance the flow of goods, services, investment, and labour mobility while also eliminating technical barriers to trade and expanding procurement coverage.

• The CFTA includes comprehensive free trade rules that apply automatically to almost all areas of economic activity. Exceptions are clearly identified in the Agreement.

• The CFTA will take effect on July 1, 2017.


SCC and the CFTA

• During CFTA negotiations, the Provincial-Territorial Advisory Committee (PTAC), a statutory committee of SCC, provided ongoing input to the central negotiating table.

• PTAC recommended strong standards-related obligations to further the goal of up-to-date and aligned standards across Canada.

• The final text of the Agreement reflects PTAC’s recommended obligations, including requirements to:

– use international standards in regulations;

– mutually recognize conformity assessment procedures;

– use Canada’s national standardization network to develop new standards.


Technical Barriers to Trade (TBT) Obligations

• Technical regulations should not create unnecessary obstacles to trade; should not be more trade restrictive than necessary; and, must be based on relevant standards, as appropriate.

• If standards do not exist or are ineffective/inappropriate, Parties should cooperate to develop national standards.

• On request, Parties must accept the results of another Party’s conformity assessment procedures, provided that those procedures offer an assurance of conformity with applicable technical regulations/standards.

• Each Party must use relevant national/international guides and recommendations as a basis for its conformity assessment procedures. ©2017 SES - The Society for Standards Professionals

Regulatory Reconciliation and Cooperation Table (RCT)

• A key component of the CFTA is a RCT composed of representatives from each Canadian jurisdiction, appointed by First Ministers.

• Objective: Reconcile existing regulations, prevent future divergences from occurring, and develop common regulatory approaches, particularly for emerging sectors.

• Several potential areas for reconciliation have been identified: gasoline blending requirements, trucking (hours of service), construction, organic food, fire-protection ratings for doors, etc.


Benefits of Standards as a Regulatory Tool

• Prevents duplication and supports a regulatory system that fosters innovation

• Standards correspond to the needs of industry and reflect the latest scientific trends and technology

• Regional and international standards support global supply chains and reduce barriers to trade

• Reduces regulatory compliance costs

• Supports market access for Canadian products and services by certifying compatibility through conformity assessment


Incorporation by Reference (IBR)

• Bill S-2, Incorporation by Reference in Regulations Act, provides legal certainty that IBR can be used in Canadian federal regulations.

• IBR is a drafting technique used to include a document, such as a standard, within a legislative text as if it were reproduced word for word.

• Documents incorporated by reference have the same binding effect as the regulation in which it is incorporated.

• Over 5,000 standards are incorporated by reference in federal, provincial, and territorial (F/P/T) regulations.


Monitoring of Standards in Regulations (MSR) Initiative

• SCC spearheaded the MSR Initiative in order to facilitate the identification of outdated and withdrawn standards incorporated by reference in F/P/T regulations.

• SCC uses a database to identify and track these references to standards and has completed reports of standards referenced in regulation for federal departments, provinces, and territories.

• PTAC has agreed that the MSR reports should also be used to facilitate alignment of referenced standards between jurisdictions, where appropriate.


Federal Regulations: Percentage of Standards Referenced


0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Domestic

Regional

(incl. US)

International

(ISO and IEC)

PTAC Working Group on Standards Alignment

• PTAC has created a working group on standards alignment to guide PTAC’s input into the RCT.

• PTAC focus on cooperation across jurisdictions to support standards-related obligations contained in the CFTA.

• The working group aims to analyze:

– The process required to attain standards alignment to facilitate regulatory reconciliation;

– The key areas for PTAC engagement in the RCT;

– The completed MSR reports from jurisdictions with completed reports that have been authorized to share their reports.


Looking to 2020: Next Steps

• Aligned and up-to-date standards across Canada resulting in significant reduction in the costs associated with internal trade barriers

• Opportunities for standards alignment to be identified by the PTAC working group on standards alignment

– PTAC working group will engage with the CFTA’s RCT

• Continued implementation of institutional mechanisms to ensure coordination between F/P/T governments to modernize standardization governance



Thank You