Red-tape lining Canada-U.S. border turning small businesses off trade, report says

The Ambassador Bridge, which connect Detroit, Mich. and Windsor, Ont. The route is one of the most important trade arteries in North America. PHOTO: Starley, via Wikimedia Commons

TORONTO—Canadian small businesses may be facing less red-tape at the Canada-U.S. border than they did five years ago, but hidden fees and other regulatory hold-ups are still weighing on small and medium enterprises north of the 49th parallel, according to a new Canadian Federation of Independent Businesses report.

“In a slowing economy, eliminating unfair and costly rules at the Canada-U.S. border is an inexpensive way of supporting small businesses, who employ more than half of all working Canadians and continue to create most of the new jobs in the country,” Corinne Pohlmann, the CFIB’s senior vice-president of national affairs, said. “With Prime Minister Trudeau and President Obama scheduled to meet this spring, we hope they will take steps to improve cross-border trade for all businesses by making red-tape-free-trade a priority.”

The report, which is based on 8,600 responses from small business owners across the country, assessed the performance of the Canada Border Services Agency and the U.S. Customs and Border Protection Agency in facilitating cross-border trade. While the report found each agency has improved accessibility, knowledge and how they treat customers, neither has worked on how they provide and communicate relevant information. 36 per cent of the survey’s respondents said administrative hassles and lack of transparency around fees forced them to reduce how often their goods get across the border.

“While we are pleased to see some progress, red tape is putting the benefits of free trade out of reach for many small businesses,” Satinder Chera, CFIB vice-president, said. “Small firms need timely and easily accessible information, which the CBSA can provide by improving its Single-Window Initiative to include small businesses, not just pre-approved customs brokers. Making fees more transparent and proportional to smaller transactions would also help.”

The CFIB is raising awareness about how much the regulatory tangle costs small businesses across the country throughout the week. Hitting SMEs harder than larger corporations, the organization says red-tape costs all Canadian businesses $11 billion more than it should each year.