Canadian labeling system undermines competitiveness

Speaking before the House of Commons committee, Robert Doering said that slow regulatory approval processes and lax requirements for products using the "Product of Canada" label undermine competitiveness for food and drink companies. For manufacturers to use the Product of Canada label, only 51 percent of production costs need to be incurred in Canada. Costs covering the import of food and drink, such as expenses for labor, transportation and packaging, can be included in this. This means companies hoping to avoid the Canadian regulatory system can source their ingredients and produce the food from outside the country, but still claim it as Canadian. "It significantly undermines innovation. It significantly undermines competition,"​ said Doering, according to Canwest News Service.​ The Canadian Food Inspection Agency (CFIA) told FoodNavigator-USA.com said it was unable to comment on the matter, but said the Canadian prime minister pledged last December to review the labeling requirements. A date has not yet been announced for this. Product of​ Canada​​​Eating locally produced food is an increasing trend in both North America and Europe. According to a report by The Hartman Group conducted in the US December 2007, 73 percent of the 796 people questioned said they currently bought products they perceived to be locally made or produced. People are showing more ethical consumerism, with concerns of transport affecting the environment for example, meaning people are keen to know the origin of their food, and to buy local. Similarly, recent safety concerns of imports from countries such as China have also fuelled the growing trend. However, current regulations mean a product can be labeled as coming from Canada even when 49 percent of production elsewhere, theoretically, consumers could be misled when purchasing such products. Doering reportedly said labels such as Grown in Canada or Prepared in Canada would offer greater clarity to consumers. Doering said reforms should be made with a straightforward directive to the CFIA, saying: "Do not engage in the black hole of food regulations. You could get into a mess by tinkering with the regulatory regime." ​​Slow regulatory system ​ Doering said manufacturers avoid producing food and drink products inside Canada because of its approval process. "Many countries don't even want to go through our regulatory approval processes here so they produce things outside​ Canada​,"​ Canwest​ quotes him as saying in an interview. ​ ​"It undermines competitiveness because Canadians have to meet a different standard than people with imported products. It also undermines investment because we have such a slow regulatory change system."​