Notice for Alberta Businesses: Understanding Canada’s new Interprovincial Mutual-Recognition Rules
How do these new rules work in practice? Let's say a company in Saskatchewan is seeking to bring a product into Alberta.
Historically, that would result in a whole host of legal requirements. This could mean that a product that is tested, labelled, inspected, and certified in Saskatchewan may still be subjected to an additional round of Alberta approvals, fees, and paperwork before it is allowed to be sold in the province.
Under Alberta’s new Interprovincial Trade Mutual Recognition Act [1], products originating from other provinces may not need to meet these duplicate requirements. Where a good has met the applicable standards and received approvals from another Canadian jurisdiction, the Act allows it to be treated as if it met the corresponding Alberta standards. Generally, an Alberta regulator cannot demand additional testing, approval or related fees simply because the product crossed a provincial border.
You may have seen this presented as: If it can be sold there, it can be sold here.
This is good advertising, but does not reflect the entire rule.
The new rules do not cover every product or displace every Alberta requirement. For example, Alberta has expressly preserved its requirement that electrical, gas-fired and plumbing equipment be certified or inspected by a certification body accredited by the Standards Council of Canada. The agreement also does not generally determine who may sell a product, how it may be sold, whether the seller requires a licence, or the contractual terms governing the sale. Food, alcohol, cannabis, tobacco, plants and live animals are excluded from the current agreement.
The agreement is primarily aimed at certain goods. It does not possess the same functionality for services, regulated professions or professional licences. Alberta’s regulation states that the service provisions do not operate unless Alberta enters into a separate mutual-recognition agreement for services.
Certain Alberta-specific certifications and safety requirements also remain. Electrical, gas-fired and plumbing equipment, for example, must still be certified or inspected by a body accredited by the Standards Council of Canada. The province also retained requirements affecting safety helmets, motor vehicles, boilers, pressure vessels, pesticides and several other categories of goods.
The Mutual-Recognition Rules have real consequences for Alberta businesses.
A growing Alberta business may now be able to enter another provincial market without needing to pay for to duplicate testing and certification standards. This creates advantages for not only large sellers, but for smaller businesses as well. The official guidance identifies small and medium-sized businesses as likely beneficiaries since duplicate testing, certification, and paperwork can make expansion uneconomical.
However, businesses looking to expand into Alberta may also benefit from the changing legislation. Businesses from other provinces may now be able to enter Alberta faster and at a lower cost, creating more competition. For some local businesses, a provincial border that once created a practical buffer will offer less protection. This of course is not stated in the act, but is a natural consequence of removing intra-provincial red tape.
Unfortunately, this is the reality introduced with this act.
This is an economic consequence rather than a rule written into the Act, but it follows from the intended reduction in regulatory costs and delays.
In particular:
Growing businesses should revisit markets they previously considered too expensive to enter.
Established Alberta businesses should consider where new competition may come from.
Any seller relying on the new rules should confirm the exact product, approval and Alberta exception before launching in a new market.
This act has not erased provincial borders, but certain goods may now find easier access to intra-provincial markets.