Why trade between Canada, U.S. is a hassle

One-third of domestic small businesses think twice about trading across the U.S. border, according to a new report by the Canadian Federation of Independent Business.

Based on more than 8,000 responses from small business owners, the report looks at the performance of both the Canada Border Services Agency and the U.S. Customs and Border Protection Agency in facilitating cross-border trade. Both agencies have shown some improvement, but 36% of business owners are discouraged by:

administrative hassles;
high costs; and
lack of transparency around fees.

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“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,” says Corinne Pohlmann, CFIB’s senior vice-president of national affairs. “Prime Minister Trudeau and President Obama [are] scheduled to meet this spring, [so] we hope they will take steps to improve cross-border trade.”

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Since 2010, the Canada Border Services Agency has shown some improvement in how they treat customers, says the CFIB report. But, it adds, the agency has showed little improvement in how it provides and communicates relevant information. In fact, small business owners gave the CBSA website a worse rating for user friendliness than in 2010.

But, CBSA fared better than its U.S. counterpart, says the report, since importing from the U.S. remains easier than exporting to the U.S. for small businesses. In particular, the U.S. Customs and Border Protection Agency requires larger amounts of paperwork and people were also more dissatisfied with its website than in 2010.

The annual cost of all regulations on businesses in Canada is pegged at $37 billion per year, with one-third of that total ($11 billion) considered unnecessary.

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