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POLITICAL LEGAL ENVIRONMENT AFFECTING TRADE IN CANADA 5

Assessing the Political-Legal Environment Affecting Trade in Canada

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Assessing the Political-Legal Environment Affecting Trade in Canada

The Canadian government is based on communal law except for Quebec province. There are three levels of government, including the Federal, Provincial and Municipal levels, and each level governs aspects of sale and distribution in its own way. Interestingly, there is little regulation of the relationship between manufacturers and distributors of products, but consumers are highly protected by Federal laws such as the Competition Act, which outlines the various prohibited trading practices such as predatory pricing and price-fixing to exploit consumers. It is worth noting that Canadian Government regulations dictate that internal and international traders should have labeling and information on their products written in both English and French so as to promote French-speaking in Quebec Province. Some barriers faced by Canada that also affect trade include tariff barriers, language barriers, distance from production country as well as taxes on trading goods

In terms of taxes, the government collects taxes which, in turn, it used to further its development agenda, including infrastructural development terms of education, providing quality, and funding education. The government levies income taxes, sales, goods and services taxes, Provincial sales taxes, and harmonized Sale taxes. Every citizen who is earning an income is liable to pay taxes and file tax returns every month of April for the year ended 31st December. For those citizens who have dual citizenship or work around the world, the Canadian tax system has a way of exempting them from paying too much tax in both the country of residence and Canada by liaising with the said country through the Canadian Foreign Pensions and Tax Treaties to determine how much tax exemptions one is eligible for.

Intellectual Property Rights and Regulations

The Canadian government recognizes the rights of internal traders and external investors to own intellectual assets such as copyrights, trademarks, patents, trade secrets, new technologies, software, and industrial designs. However, some regulations accompany these rights (McCommark, 2010). For example, your Canadian Patent applies within Canada for 20 years from the date of application. Also, for an industrial design to be accepted, it must properly resemble the actual final product.

Recommendations

The following are important recommendations for an existing company or a new enterprise seeking to navigate and coexist in a mutually beneficial relationship with the prevailing political and legal environment in Canada;

Traders to keep their prices in check so that they do not go overboard and exploit their customers or even push their prices too low in a bid to outdo their competition. When this happens, according to Kaplow (2013), traders attract the attention of the government and price regulation bodies because of the exploitation of consumers. When they push their prices lower, they may at times make losses.

Businesses should comply with government regulations and licensing procedures so that they can be in line with government rules and regulations pertaining to issues to do with health and pricing, thereby avoiding constant collisions with government agencies tasked with licensing and regulating businesses.

Traders to pay and file tax returns in time as well as provide annual financial statements as requested by the government. According to Glennerster (2014), this is one of the government’s ways of generating income to provide essential services to citizens, including health care, education, and infrastructural development like transport and communication systems.

Entrepreneurs to be on the lookout for government loans and tax reliefs that enable them to generate capital to start and run their businesses, companies, and industries.

References

Glennerster, H. (2014). Taxes. Paying For Welfare, 127-148.

Hill, C. (2008). International Business: Competing in the global marketplace. Strategic Direction.

Kaplow, L. (2013). Competition policy and price-fixing. Princeton University Press.

McCormack, Stuart C. (2010-10-01). Intellectual Property Law of Canada – Second Edition. Juris Publishing, Inc. ISBN 9781578232642.

Speeding Up Trade: Benefits and Challenges of Implementing the WTO Trade Facilitation Agreement (2015). World Trade Report 2015, 72-105.

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