New Canadian Food Safety Policy will Impact U.S. Exporters
On January 1, 2015, new regulations regarding the importing of food into Canada went into effect, with additional requirements later this year and in 2016. These new regulations will have a significant impact on U.S. companies exporting food to Canada, and should be understood closely.
Specifically, Canada has introduced new licensing requirements for Canadian food manufacturers and importers, adding a layer of regulation that previously did not exist. Food manufacturers exporting to Canada, now abiding by the requirements of the U.S. Food & Drug Administration, will now have to include all of the CFIA requirements for the Canadian license, as well. In addition, U.S. exporters to Canada must have a fixed Canadian location, or Canadian manufacturing standards must be equaled by the country of origin's own standards, which will be difficult to enforce.
The new regulation also sets forth Canada-only labelling requirements, which will affect production lines efficiency and add cost.
Perhaps the biggest impact on U.S. companies is the elimination of drop shipment capabilities into Canada. For example, if a U.S. importer is importing product from Brazil for eventual delivery to Canada, that product can no longer be shipped directly into Canada. Instead, it would have to stop in the U.S. at the seller's location, which they currently may or may not have.
Over the last several years, the U.S. and Canada have worked closely toward harmonized regulations through the work of the Regulatory Cooperation Council (RCC). These new regulations seem to be a disappointing step backwards in that relationship. There is a great deal of information to sort through with this new policy, and we'll keep you in-the-know, but more can be found on the CFIA website.