Lou Riccoboni's Collective Conversation Blog

Steve Verheul, Canada’s chief trade negotiator is making a concerted effort to reach out to Canadian companies. According to the Canadian Chamber of Commerce, Verheul is establishing a group of approximately 30 companies from various sectors and regions across Canada that have a stake in successful Canada-EU trade negotiations. Apparently, candidates should have a serious interest in this next generation ‘free trade’ agreement and, ideally, bring to the table industry-specific knowledge about Europe. This announcement follows news reports early this week that Canada’s dairy sector, concentrated in political battle grounds of Ontario and Quebec, is threatening to scuttle the negotiations. EU members want access to Canada’s tightly controlled supply managed sector including dairy, poultry and eggs. Stockwell Day, Canada’s Trade Minister was quick to react saying Canada’s supply managed industries are “not up for negotiations.” This puts Verheul in an awkward position at the very beginning of negotiations. How can Canada demand increased EU market access for beef and pork products when Canada has already concluded that reciprocal market access is non-negotiable? Only time will tell if Verheul can muster enough political will across Canada, mitigate the self-interest of 27 EU members, and all the while protecting Canada’s special interests.

On September 8th, Michael Horgan will become the new Deputy Minister of Finance and one of the most influential figures in the Canadian government. He will oversee and advise on crucial policies such as taxation, budgetary spending, and debt management. Every industry in Canada will be affected by his decisions and advice. But who is Michael Horgan?

Ian Brodie, Hill & Knowlton Canada’s Senior Counsellor and former Chief of Staff to the Prime Minister recently provided clients with insight into Finance Canada’s newest Deputy Minister. Below, please find an excerpt of Ian’s note.

Horgan is a long-time Finance Department economist. He rose through the ranks in the Department, with postings to the Privy Council Office and Atlantic Canada Opportunities Agency. He served as Deputy Minister of Indian Affairs in the Paul Martin government, when aboriginal issues were a top-level political priority.

With the election of Stephen Harper and the appointment of fellow Finance mandarin Kevin Lynch as Clerk of the Privy Council, Horgan was moved to Environment Canada and put in charge of developing the Harper government’s ambitious regulatory plan for reducing green house gas emissions. While the resulting plan clearly fell short of what climate change activists were demanding, it would, if implemented, insert the federal government into dozens of new areas of regulation with untold consequences for the Canadian economy.

A year ago, Horgan was posted as Canada’s executive director at the IMF. He has therefore had a superb opportunity to track the international financial crisis and efforts to coordinate an international response. He therefore returns to Ottawa well-positioned to see Canada’s fiscal and monetary situation in a broader context.

Horgan is a quiet introvert. He is rigorously analytical, pragmatic and possesses a broad policy background. His appointment does not likely signal a significant shift in government policy or direction. He will, with Bank of Canada Governor Mark Carney, be looking for deeper signs of economic recovery before he begins to plot an exit from the multiple economic stimuli that currently anchor Canada’s fiscal and monetary stance.

- Ian Brodie, Senior Counsellor, Hill & Knowlton Canada; August 2009

The House of Commons Finance committee will once again conduct public pre-budget consultations. The rumoured theme for the 2009-10 consultations is “Sustainable Economy”. It is my understanding that witnesses must file with the Clerk by July 31 their intention to participate and actual submissions are due August 14, 2009.

For many witnesses, the consultations are the core of their federal budget advocacy campaign. In fact, these consultations are only one small component. H&K has worked on a number of successful campaigns – the key is to remain tenacious and to consider multiple approaches. Over the summer, H&K will assist clients develop comprehensive communications’ strategies, including preparing for the pre-budget consultations and beyond. Please don’t hesitate to contact me for a complimentary copy of H&K’s presentation on Tips: Appearing Before the House of Commons Finance Committee.

Yesterday, Canada’s department of Foreign Affairs and International Trade (DFAIT) expanded its public consultations towards a Canada-EU free trade agreement.

To help respondents, the department posted a questionnaire http://www.international.gc.ca/consultations/active/index.aspx?lang=eng#partner

Early hot spots in the negotiations could include: labour mobility; geographic indications, trade-marks, copyright, and patents; and rules of origin labelling.

Submissions are due June 30, 2009.

For additional information, don’t hesitate to contact me directly at lou.riccoboni@hillandknowlton.ca

Highly trusted sources have confirmed that David Jacobson will be the next US ambassador to Canada.

Jacobson was Obama’s presidential campaign deputy finance chair and recently served in the White House as a special assistant to the president in the Office of Presidential Personnel.

In the private sector, Jacobson was a partner at the Chicago office of Sonnenschein Nath & Rosenthal LLP. He specialized in securities and complex litigation.

Jacobson’s early trade briefings will likely include softwood lumber, energy, ‘Buy America’, Canada-US border issues and pending Chapter 11 disputes including Dow AgroSciences and AbitibiBowater. Let’s hope Jacobson can allay growing fears of US trade protectionism.

This morning, I received a report on recent developments in the Canada-EU free trade negotiations from Hill & Knowlton’s office in Brussels.

According to our sources, the inaugural round will take place in Montreal, Quebec on June 9th and 10th of this year. This first round will establish the rules of engagement; the frequency of negotiations, and the parties involved. Canada’s biggest challenge out of the starting block is managing participation by the provinces without losing control of the negotiations. The provinces are not generally involved in state-to-state negotiations. The EU however made negotiating access to provincial government procurement contracts a pre-condition, and as a result, the federal government will somehow need to bring the provinces into the negotiating room. But Newfoundland’s refusal to sign the Council of the Federation statement endorsing negotiations nearly derailed the entire process, and this was before the EU even banned seal imports. Imagine Newfoundland’s future position on a Canada-EU FTA.

As for the EU, they may have an even bigger challenge of balancing the various interests of all 27 member states, especially Germany and France. Agricultural issues including dairy, cereals and beef-hormones could test the negotiating waters early. This may be why Steve Verheul was picked as Canada’s top negotiator. Verheul was Canada’s former chief agriculture negotiator prior to his recent appointment effective April 1, 2009.

Other early challenges and potential deal-breakers could include geographic indicators or GIs. According to the EU, GIs are names given to certify that a product has certain qualities, or enjoys a certain reputation, due to its geographical origin. For instance, true champagne can only be produced in the Champagne region of France and if it is produced anywhere else, it must be referred to as sparkling wine. And while a 2004 sectoral agreement temporarily resolved GIs on Wine and Spirits, EU companies will want to extend GIs to food products. For example, ‘cheddar’ cheese should be reserved only for products made in the English village of Cheddar, in Somerset. Hundreds of these examples will surface including Parmigiano-Reggiano, Bologna, Swiss, etc.

Finally, it appears using the term ‘Free Trade Agreement’ conjures mistrust and the process could look to rebrand the negotiations. Maybe a PR campaign is already afoot? Or has protectionism reached new lows?

We’ll have two to three years to find out.

Below is a deck Hill & Knowlton produced prior to the launch of the negotiations.

Appearing before parliamentary committees can be exciting and a good opportunity to inform committee members and the public on important public policy issues.  They can also be a strong component of your public affairs strategy.  But what’s the strategy? Should you appear or simply provide a written submission?  If you do appear, what’s your goal?  These are some questions you may want to think about when it comes to appearing before parliamentary committees.

Here are some tips you may consider if you decide to appear before a parliamentary committee.

Pre-Hearing Check-List

• Arrive 15-30 minutes prior to your scheduled presentation. Provide yourself with some time to register with the Clerk of the Committee, acquaint yourself with members of the committee and to settle in.
• Pick a seat in the middle of the witness table if possiblele. If the Clerk has not assigned you a specific seat, try and pick a spot in the middle of the witness section.  This is the best spot to answer questions and for the TVs if the hearing is televised.
• Pour yourself a glass of water. On the table, you’ll find water containers and glasses.  Pour yourself a glass of water and settle in. Don’t pour water while speaking or once the committee hearings have begun, as this can be a distraction. Beware of the overflowing ice.
• Hook-up to translation devices. On the edge of the witness table, you’ll find ear pieces connected to a panel switch.  Committee hearings are conducted in both official languages and simultaneous translation is provided.  Plug into the control panel and turn the dial to your preferred language; usually ‘1′ for English, ‘2′ for French and ‘3′ for floor mike (no translation).  You may present and reply to committee members in either official language.
• Check your notes and review your speech. Take a minute to ensure that you have all your documents organized and laid out in front of you.  Now is a good moment to quickly review your speech one last time.
• Don’t play with the microphone. The microphone is activated and deactivated by an operator.  A red light will appear on the base of the microphone when it is live.  You won’t have to press the button at the base, just simply ensure that the microphone is pointed in your direction.

Committee Hearing Up and Running:  What to expect.

• The chair begins with calling the meeting to order, welcomes witnesses, and then makes a brief statement about the purpose of the hearing.  The chair usually then calls on the first witness on the witness list.  As a rule, committee chairs tend to give each witness five minutes to make opening remarks.
• Once the first witness has concluded their opening remarks, the chair will call on the next witness.  The chair continues this process until all witnesses have made their opening remarks.
• After all witnesses have made their opening remarks, the chair usually invites committee members to ask questions.  The Official Opposition usually asks the first question (the MPs seated at the top right).  Questions can be directed to one witness or to all witnesses.  Answer the question to the best of your knowledge. (If you presentation is controversial, get committee training since there are strategies to consider).
• Near the end of the hearing, the chair can ask witnesses to provide a brief summary of their presentation or final comment.  If this happens, simply reiterate your key messages or recommendations.
• The chair will then thank the witnesses for their presentation and conclude the hearing.

A private member’s bill in the Canadian parliament threatens to ban financial and political support to any Canadian oil, gas and mining company that violates potential new corporate responsibility guidelines while operating abroad.  Bill C-300, An Act respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries could ban Canadian companies from receiving funding by investors such as Export Development Canada (EDC) and the Canada Pension Plan (CPP).  Furthermore, companies that contravene the bill could be banned from receiving diplomatic or consular support, and be prohibited from participating in any federal government sponsored activity such as trade missions.

First introduced on February 9th 2009 by Liberal Member of Parliament John McKay, C-300 has rapidly moved through the Canadian legislature and this bill is now slated for parliamentary hearings before the Commons Foreign Affairs and International Development Committee (FAAE).  This is a major coup for the NGOs and the sponsor of the bill.  Not only have they been able to advance a private member’s bill beyond second reading (a very rare feat in Canadian parliament and passed by only 4 votes; 137 for and 133 against), they’ve been able to steer the bill into a committee focused on ‘soft power’ issues.  The Common’s International Trade Committee (CIIT) would have been a logical choice but the FAAE committee could be more sympathetic to advancing the bill to report stage and 3rd reading.

My colleague, the Hon. Don Boudria, H&K’s expert on federal parliamentary procedure and a former Canadian cabinet Minister suggests that had the extractive industry mobilized earlier, the outcome of the vote may have been very different.  “It appears that the vast majority of industry stakeholders didn’t anticipate the outcome of the vote and as a result, will now need to play catch up” said Boudria.

Parliamentary hearings are slated to begin May 25, 2009.

If you’re interested in appearing on Bill C-300, please contact the Clerk of the Committee, Ms. Angela Crandall at (613) 996-1540 or by email at faae@parl.gc.ca.  And if you need more information, please don’t hesitate to contact me at (613) 786-9934.

Tomorrow, I’ll post some tips on appearing before parliamentary committees from a book I co-wrote titled A Guide to Government Relations for Directors of Not-For-Profit Organizations.

Today, Canada’s Prime Minister and the Czech President, this semester’s President of the EU, are expected to announce in Prague the beginning of formal Free Trade negotiations.

The Canada Europe Roundtable for Business (CERT) estimates that a bilateral agreement would increase trade and investment by up to $40 billion within seven years.

As a result of the current global economic crisis however, concluding a successful agreement will be challenging.

While many companies on both sides will support a free trade agreement, an equal number of companies and sectors will oppose the agreement.

For example, Canada presently applies a 6.1 percent tariff on the importation of foreign automobiles.  Volkswagen, BMW, Mercedes and other European manufacturers will want this tariff eliminated.  However, domestic car manufacturers such as GM and Ford as well as Asian car manufacturers will lobby extensively to maintain the tariff and protect their market share.

Hundreds of these examples will surface during the negotiations, including access to provincial government procurement, geographic indicators, shipbuilding, pharmaceuticals, financial services, telecommunications, agriculture and agri-food, forestry and much more.

While negotiators will do a fine job representing industry over specific tariff lines, companies should also consider the political and public environment.  Managing the “politics” and the “street” can be just as important as watching what takes place in the negotiating room.

It was the lobby efforts of the domestic car manufacturers that stalled the Canada-South Korea Free Trade negotiations. And yesterday’s EU ban on seal products could be a sleeping deal breaker in the Canada-EU Trade negotiations which begin today.