What peeves U.S. about relations with Canada? A lot

Even wine, beer and spirits are on the list

Trade relations between Canada and the U.S. are in a rocky patch.

Just look at the last few weeks. The U.S. imposed stiff tariffs on Canadian lumber shipments. U.S. President Donald Trump says he came close to signing an order to terminate the North American Free Trade Agreement. And last Tuesday, Sen. Jon Tester (Dem-Montana) introduced a Senate resolution that would ask Trump to examine whether Canada unfairly interferes with U.S. wheat shipments.

You might well ask, what’s next? And you might wonder: If only there was a handy list of all the issues that could erupt between the world’s largest bilateral trading partners.

There is. It’s a hefty document the Office of the U.S. Trade Representative publishes each year called the National Trade Estimate Report on Foreign Trade Barriers. It lists, country by country, the major foreign trade policies that either the U.S. doesn’t like, or that could pose a problem for U.S. exporters. “Such an inventory enhances awareness of these trade restrictions and facilitates negotiations aimed at reducing or eliminating these barriers,” the report explains.

Canada takes up eight of the 492 pages in the report. As countries go, that’s fairly average. China, by contrast, earns 19 pages, while the European Union gets a hefty 45.

So what else annoys the U.S. when it comes to trade with Canada? Here are some items that made the list.

Canada limits imports to varieties that have been registered in Canada, and the U.S. says the registration system is slow and cumbersome.

The U.S. says the Canadian rules reduce Canada’s demand for U.S. dry milk protein concentrate. This is the dispute that got President Trump worked up during a recent speech in Wisconsin.

You’ll have heard about this one. The U.S. says Canada’s regime severely limits the ability of U.S. farmers to sell into Canada.

The U.S. alleges Canada’s Special Milk Class Permit Program sets up prices that undercut and displace those of similar products from the U.S.

As noted in the resolution by Montana Sen. Jon Tasker, the U.S. believes Canadian policies limit the ability of U.S. exporters to receive a premium grade for their products. U.S. farmers say this means their grain can only be sold in Canada as animal feed.

Most Canadians are well aware that they can only buy so much stuff duty-free while on vacation outside the country: $200 after trips of more than 24 hours, and $800 for trips of more than 48 hours. The U.S. says this is less generous than its own duty-free exemptions.

The U.S. says that at $20, Canada has the lowest threshold for which no duty or tax is charged on imported items. In the U.S., the threshold is $800.

You knew this would be in there. The U.S. says Canada’s various alcohol retailing policies stop Canadians from buying U.S. booze. The U.S. has challenged B.C.’s provincial retailing rules under the WTO. The U.S. also says it’s studying the trade implications of Ontario’s move to let grocery stores sell wine.

The report takes note of loans and other assistance that Canada and Quebec have made to Bombardier, particularly for the development of the CSeries aircraft. Last Thursday, Boeing filed an official complaint with the U.S. Department of Commerce and U.S. International Trade Commission seeking an anti-dumping, countervailing duty on the CSeries. The U.S. says NAFTA and the WTO Agreement on Government Procurement should enable U.S. businesses to bid on most federal and provincial contracts. The report also notes that Hydro-Quebec has a local content requirement for some green energy projects, and says these pose hurdles for U.S. companies working in Canada’s renewable energy sector.

The U.S. flags this as a “continuing priority.” While the U.S. welcomed a recent Canadian move to extend protection on some sound recordings to 70 years from 50 years, the U.S. says it still has concerns on Canadian law regarding pharmaceuticals. The U.S. is also concerned about the “due process and transparency” of the geographical indications or point-of-origin labelling system in Canada.

The U.S. describes Canada’s 46.7 per cent foreign ownership limit on Canadian telecom companies as “one of the most restrictive regimes among developed countries.”

The report makes note of several “Cancon” requirements for Canadian broadcasters and cable companies. The U.S. also says it is “highly concerned” about the CRTC’s decision not to permit “simultaneous substitution” of advertising during the Super Bowl.

The report takes note of the hurdles, such as the “net-benefit” to Canada test, that some foreign buyers must clear before acquiring some Canadian companies.

The U.S. says a tender for a Canadian federal government “cloud” storage project requires the data be stored on servers physically located within Canada. The U.S. says this effectively prevents U.S. companies for bidding on the project.