Agri-food and aquaculture: Targeted regulatory review - Policy and program initiatives and novel approaches

The Pest Control Products Regulations do not allow use of electronic labels or, in most circumstances, labels based on the Globally Harmonized System of Classification and Labelling of Chemicals. As such, registrants have to bear the costs of paper-based labels rather than using an electronic label, and they don't have the option of aligning their Canadian label to a European one, for example. Additionally, labels are not currently structured or worded in a consistent manner, making it harder for users to understand and find the information they need to use pest control products safely and efficiently.

The Pest Control Products Act also does not allow the Minister to amend registrants' approved product label content without receiving an application for each. As a result, registrants must spend time and resources submitting applications even to implement simple required changes (for example, as a result of a regulatory amendment). This creates avoidable administrative burden for industry.

Health Canada proposes to address this issue by proposing amendments to the Pest Control Products Regulations to modernize pesticide labels, including to permit use of electronic labels and international formats (that is, the Globally Harmonized System of Classification and Labelling of Chemicals), and to improve the readability of labels.

Health Canada also proposes to amend the Pest Control Products Act to give the Minister the ability to make label changes to align with changes to regulatory requirements (that is, without the registrant needing to submit an application for the change).

With respect to amending the Pest Control Products Regulations, pre-publication of the proposed regulatory amendments in the Canada Gazette, Part I is targeted for 2020.

The proposed statutory amendments would be pursued via the legislated Parliamentary review of the Pest Control Products Act, which could commence in 2020.

Policy and Regulatory Affairs Divisions
PMRA, Health Canada
Email: pmra.regulatory.affairs-affaires.reglementaires.arla@hc-sc.gc.ca

Industry stakeholders have indicated that the current list of authorized pest control products for which registration is not required is out of date. The products on this list are products with low- or well-characterized risk, such as products used for organic agriculture. Further, the process for updating the list via the Governor in Council is too slow and inflexible to keep up with changing industry needs. An 18 to 24 month process is required to add even a single low-risk product (for example, a food-grade substance), which is not reflective of the low risk presented by such a product.

Stakeholders also indicated that there is duplication between Health Canada and Canadian Food Inspection Agency in the oversight of nitrogen stabilizers.

In the short term, the Pest Control Products Regulations would be amended to update the list of authorized pesticides to include more products (for example, products used for agriculture, pool and spa products and treated articles). Amendments would also be made to allow nitrogen stabilizers to be regulated by the Canadian Food Inspection Agency alone, rather than also requiring duplicative oversight by Health Canada. See Health Canada's Forward Regulatory Plan.

In the longer term, statutory changes would be proposed to grant the Minister power to add certain types of pest control products to the list of authorized products not requiring registration. This would enable products with low- or well-characterized risk to be added to the list without going through the Governor in Council process. Statutory changes would also be proposed to grant the Minister power to strengthen post-market regulatory oversight, including to manage any potential health or environmental risks arising from an increased number of authorized products not requiring registration. These products would be made subject to the same post-market requirements as registered products. This would include, for example, incident reporting and sales reporting, and allowing Health Canada to require recalls and stop-sales of non-compliant authorized products.

A public pre-consultation document on the proposed regulatory amendments was published online on 30 November 2018, with written comments being accepted for 90 days.

With respect to amendment of the Pest Control Products Regulations, pre-publication of the proposed regulatory amendments in the Canada Gazette, Part I, is targeted for winter / spring 2020. Final publication of regulations in the Canada Gazette, Part II, is targeted for fall 2020.

The proposed statutory amendments would be pursued via the legislated Parliamentary review of the Pest Control Products Act, which could commence in 2020.

Policy and Regulatory Affairs Divisions
PMRA, Health Canada
Email: pmra.regulatory.affairs-affaires.reglementaires.arla@hc-sc.gc.ca

While consistent with international standards, the re-evaluation process for pesticide products is resource intensive, and has been criticized as taking too long and lacking transparency/engagement. In addition, the Pest Control Products Act requires Health Canada to initiate a new post-market review of a particular issue of concern, even if doing so duplicates the work of another post-market review.

In 2018, Health Canada began a review of the Re-evaluation Program for pesticide products and will be considering opportunities for improvements to address challenges been identified by stakeholders.

As part of this review, Health Canada has consulted and will continue to consult its stakeholders and key partners to develop a plan to achieve a sustainable post-market pesticide review program that continues to protect health and the environment.

The review will result in recommendations to improve the re-evaluation process for pest control products to make it more efficient, effective and financially sustainable. These recommended improvements could involve possible statutory, regulatory, policy and/or process changes. Any recommended statutory changes flowing from the review would be pursued during the Parliamentary review of the Pest Control Products Act, which could start in 2020

Some operational changes to process may be possible under current legislation, and would be implemented as soon as practicable, such as enhancing the opportunity for stakeholder engagement.

In the short term, Health Canada proposes to amend the Pest Control Products Act to eliminate duplicative or unnecessary work by allowing the Minister of Health to: expand the scope of an existing post-market review rather than initiating a new special review; and, decide not to initiate a new special review if the issue of concern is being or has been addressed in another post-market review, and, in the latter case, that there is no additional information that would warrant initiating a special review. The Minister would retain the option to proceed with special reviews where it is in the best interest of health and environmental protection.

In the longer term, statutory changes may be proposed to more comprehensively amend or restructure all post-market reviews to increase efficiencies, avoid duplication of efforts, and increase clarity, coherence and predictability between currently parallel processes for re-evaluations and special reviews. Such proposals could be considered as part of the Parliamentary review of the Pest Control Products Act, which could start in 2020.

Health Canada consulted its stakeholders and key partners in fall 2018/Winter 2019 to inform development of a plan to achieve an efficient, effective and sustainable post-market pesticide review program that continues to protect health and the environment.

Short term: 1 to 2 years

Seek amendments to s. 17 of the Pest Control Products Act (concerning special reviews), to eliminate duplicative and unnecessary work, as described above. These proposed amendments are set out in the Budget Implementation Act, 2019.

Complete the review and seek approval to implement non-statutory components.

Medium term: 3 to 5 years

Pursue implementation through statutory or regulatory changes as required, as well as amendments resulting from the Parliamentary review of the Act (as early as 2020).

Develop a business case to support the long-term sustainability of the re-evaluation program.

Policy and Regulatory Affairs Divisions
PMRA, Health Canada
Email: pmra.regulatory.affairs-affaires.reglementaires.arla@hc-sc.gc.ca

Concerns have been expressed about Canada's aquaculture regulatory regime for being too complex, overlapping and lacking transparency. There are concerns that these challenges hinder both competitiveness and responsible growth of the industry.

DFO is the primary federal regulator for aquaculture in Canada; however, some aspects of aquaculture also involve other federal organizations. While aquaculture is a shared regulatory jurisdiction between federal and provincial and territorial governments, and is generally viewed as a strong, robust regulatory regime for effective management of aquaculture, stakeholders have expressed concern about varying requirements in different provinces, which can lead to complexities and inconsistency, and the need for consolidated regulations that recognize and meet the specific needs of aquaculture management.

Stakeholders have provided both specific and general feedback on how DFO can improve how it regulates aquaculture in Canada. As a way to address many of these concerns, DFO is developing the General Aquaculture Regulations (GAR). This initiative would consolidate DFO's diverse regulatory provisions pertaining to aquaculture into 1 comprehensive set of regulations under the Fisheries Act, which will enhance regulatory clarity and understanding and provide the opportunity to deliver a suite of amendments that will improve many aspects of aquaculture management.

For example, subject to further consultation, the GAR will address stakeholders concerns on the following:

• better clarify regulatory requirements by consolidating DFO's diverse aquaculture regulatory provisions into a single set of regulations
• increase transparency through enhanced reporting authorities and requirements
• anticipate and allow for industry innovation (for example via national standards)

The GAR will continue to respect provincial and territorial jurisdictions. DFO will continue to regularly engage and consult with its regulatory partners and stakeholders as the GAR is developed and implemented.

In December 2018, provincial Ministers agreed to support the development of a federal aquaculture act with limited scope that respects federal, provincial and territorial jurisdictions, and provides greater clarity to the sector. Though the development of federal aquaculture act is not being developed in response to the TBS regulatory review process, the legislative authorities in the Act will need to be established before the GAR can be finalized. The proposed Act, together with the GAR, will support industry growth and investment by providing clarity and certainty to the sector while enhancing environmental protection and overall sustainability.

Given that aquaculture in Canada is a shared federal-provincial-territorial jurisdiction and managed via complex federal and provincial regulatory frameworks, DFO will continue to engage provincial and territorial partners as well as Indigenous groups as it moves forward with the GAR and the proposed aquaculture act.

Regarding the act, DFO will engage with Canadians in spring/summer 2019 and 2020. At present, it expected that drafting of a new bill will begin in late 2020 with ongoing engagement with Indigenous groups, stakeholders, and provincial and territorial partners. Royal assent could be expected as early as fall 2022. It is expected that the department will be in a position to finalize the GAR once the act has received royal assent.

Aquaculture Management Directorate
Fisheries and Oceans Canada
Aquatic Ecosystems Sector
Fisheries and Oceans Canada
Email: AquacultureConsultations.XMAR@dfo-mpo.gc.ca

The Public Health Agency of Canada (PHAC) regulates human pathogens under the Human Pathogens and Toxins Act (HPTA) and the importation of certain animal pathogens under the Health of Animals Act (HAA). The Canadian Food Inspection Agency (CFIA) regulates certain animal pathogens under the HAA.

Feedback received from stakeholders responding to the Canada Gazette consultation as well as feedback received previously from regulated parties has cited misalignment and duplication between Canada's regulatory regimes for pathogen oversight. This makes it burdensome for entities regulated by both PHAC and the CFIA to comply with their regulatory obligations and may discourage innovative research in Canada. Researchers may have difficulty complying because of different definitions of controlled activities for human and animal pathogens, or duplicative regulatory requirements under different legislation. This can cause undue costs, unnecessary diversion of resources, and slowdowns of innovative research.

To address these issues, PHAC and CFIA would collaborate to explore:

• Alignment of HAA and HPTA definitional differences identified by our shared stakeholders
• Opportunities to align, clarify for regulated parties and cooperate on oversight of human and terrestrial animal pathogens

Furthermore, PHAC would:

Propose to streamline regulation-making authorities in the HPTA to follow the standard Canada Gazette consultation process, rather than needing prior approval through both Houses of Parliament, to enable a more nimble and responsive regulatory framework for human pathogens and toxins while maintaining existing health safeguards.

1) Increased collaboration between PHAC and CFIA

There may be opportunities to increase clarity and decrease administrative burden on parties regulated by both PHAC and CFIA. To address these issues, by December 2020, PHAC and CFIA will collaborate to explore (1) alignment of different definitions in the Health of Animals Act and Human Pathogens and Toxins Act (HPTA); and (2) risk-based exemptions from duplicative regulatory requirements between HPTA and other authorities. Better alignment of legislative authorities would minimize regulatory burden and duplication while continuing to maintain appropriate health safeguards.

2) Regulation-making authorities

Current Governor in Council regulation-making authorities under the HPTA require the Minister to lay proposed regulations before both Houses of Parliament, except those to update schedules of human pathogens and toxins. The proposed legislative amendments to the HPTA would streamline the regulatory process by repealing the requirement for the Minister of Health to seek approval through both Houses of Parliament prior to making new or amended regulations, and instead allow the Minister to proceed through the standard Governor in Council process, including pre-publication in the Canada Gazette. This would align the HPTA with similar legislation (for example, the Health of Animals Act).

2 separate timelines will be followed to address the identified areas for improvement:

• Explore alignment of HAA and HPTA definitions and risk-based exemptions (2020)
• Proposed legislative amendments to streamline HPTA regulation-making authorities from approval by both Houses of Parliament to standard Governor in Council process: legislative amendment is being sought as part of the Budget Implementation Act, 2019

Office of Stakeholder Engagement and Regulatory Affairs
Health Security and Infrastructure Branch
Public Health Agency of Canada
Email: phac.pathogen-pathogene.aspc@canada.ca

Stakeholders have commented that industry competitiveness and innovation need to be more prominently considered as part of departmental and agency mandates and activities.

The CFIA has a broad mandate, focused primarily on mitigation of food safety, plant and animal health risks, while also responsible for market access related activities. Industry stakeholders seek increased consideration of competitiveness in the delivery of regulatory programs. To promote all of these interests, the CFIA proposes to develop a policy that links innovation and best practices in risk reduction with competitive advantages in the delivery of CFIA services.

The policy would outline how the CFIA would provide competitive advantages in the delivery of CFIA services by incentivizing innovation and best practices in risk reduction. Regulated parties are required to comply with regulatory requirements; however, there are those that voluntarily go above and beyond legal requirements. This policy would outline criteria for this differentiating advantage that would include such things as: improving food safety and authenticity; enhancing plant protection; improving animal health and welfare; increasing environmental and sustainability benefits; lowering costs or providing other benefits for consumers/businesses; and surpassing federal and international standards and approaches. It would also outline how this differentiation would enable categorization of those businesses, through a tiered approach, for the receipt of preferred CFIA services (for example, fast lane for pre-market assessment, streamlined inspection regime, etc.).

A framework document will be developed to engage stakeholders, prior to the development of the policy. Feedback received during the consultations will help the CFIA in shaping its Competitiveness and Innovation Policy

Stakeholders will be engaged early in the policy development process to assess which CFIA services are of greatest interest to them in this context. Engagement will continue through to policy finalization and implementation.

The framework would be developed in the short term, in other words, by summer 2019, followed by external consultations with stakeholders in late fall 2019 / early winter 2020.

This would be followed by the development of a policy, targeting late spring 2020.

Implementation of the policy would be in the medium to long term, through integration in existing CFIA programs and services.

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Stakeholders encourage federal departments to increase investment in Canadian participation at international standard setting bodies, to promote Canadian trade interests, and improve harmonization with international trading partners. Maintaining and strengthening the integrity of the international rules-based trading system through strong international leadership is important to help Canada achieve export growth targets.

Agriculture and Agri-food Canada (AAFC), Health Canada and the Canadian Food Inspection Agency (CFIA) will enhance their engagement in the development of international standards.

This would be carried out in areas within the respective department's mandates (for example sanitary and phytosanitary measures, human health, technical barriers to trade, etc.). This initiative includes enhancing engagement in the work of the Codex Alimentarius Commission's to help develop standards, guidelines and recommendations that protect consumer health and promote fair practices in food trade, the World Organization for Animal Health (WOAH), and the International Plant Protection Convention for plant health.

To support this enhanced engagement, AAFC, Health Canada and CFIA will also build capacity to provide expertise to inform Canadian positions and facilitate international standard development process (for example increase the ability to provide expertise to international scientific expert advisory bodies).

Participation as part of international standard setting bodies contributes to alignment of Canadian standards with international standards and helps address non-tariff barriers to trade.

The benefits and results will be realized over the long term since the development of trade rules and international standards are negotiated over several years between member countries of the relevant international organizations.

Regulatory Policy Coordination Office
Strategic Policy Branch, Agriculture and Agri-Food Canada
Email: aafc.regulation-reglementation.aac@agr.gc.ca

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Food Directorate
Health Products and Food Branch
Health Canada
Email: hc.food-aliment.sc@hc-sc.gc.ca

Health Canada undertakes a pre-market assessment for various food products (for example food additives, infant formula, packaging materials and processing aids) to ensure they are safe for Canadians. However, the pre-market assessment process can be lengthy, even though these products may have already been assessed and permitted in like-minded countries. This prevents industry from marketing safe and innovative food products to Canadians in a timely manner.

Health Canada will address this issue by exploring the feasibility of using foreign reviews and conducting joint risk assessments with like-minded countries to bring innovative food products to market in a timely manner.

Health Canada has cooperation mechanisms in place with various like-minded countries such as United States, Australia, New Zealand as well as the European Union. These arrangements enable the department to leverage scientific and technical capacity, undertake joint assessments and facilitate regulatory alignment in areas of mutual interest.

In the short term, Health Canada will complete a feasibility study to identify potential product lines and conditions for which foreign reviews and joint risk assessments can be undertaken. Health Canada will explore how the existing agreements can be leveraged for joint safety assessments or sharing assessments. Following this, Health Canada will establish potential conditions, product lines and criteria, under which Health Canada can consider using foreign reviews. Health Canada will also need to conduct a thorough comparability analysis (both in terms of regulatory frameworks and safety assessments) to determine the suitability of using foreign reviews. This will lay the foundation for Health Canada to proceed with establishing a process for working with foreign regulators for pre-market approvals and joint risk assessments.

Any new approach to support the use of foreign reviews and joint risk assessments will maintain the primacy of health and safety and the integrity of the science-based decision-making process, while also supporting the economic and innovation interests of the agri-food industry.

This initiative will allow Canada to enhance alignment of regulatory approaches with trusted foreign regulators (for example, United States, European Union, Australia, New Zealand).

Health Canada is expected to complete its feasibility study by summer 2020, following which Health Canada will initiate work to establish a process for use of foreign reviews and joint risk assessment in fall 2020. Health Canada is expected to have processes in place by the end of the 2021 to 2022 fiscal year.

Food Directorate
Health Products and Food Branch
Health Canada
Email: hc.food-aliment.sc@hc-sc.gc.ca

Federal regulations apply to businesses that trade across provincial/territorial or international borders, while provincial/territorial regulations apply to those that sell only within their province/territory.

To trade inter-provincially, businesses must meet all the applicable federal requirements to get a federal license. The example most often cited by industry is that requirements specify that meat and meat products can only be commercially moved across provincial borders if they are derived from the federal meat inspection system.

The requirements for obtaining a federal registration or license were often more rigorous and, consequently, more costly and time consuming. The former Meat Inspection Act/Regulations, which were replaced by the Safe Food for Canadians Act and Regulations on January 15, 2019, were prescriptive in nature. There were no provisions for exemptions based on recognition of provincial or territorial regulatory systems.

On January 15, 2019, the Safe Food for Canadians Act (SFCA) and Safe Food for Canadians Regulations (SFCR) came into force. The SFCR apply international food safety standards established by Codex Alimentarius to all food that is imported, exported or traded between provinces, and requires that all food products traded across Canada meet the same food safety outcomes.

The Regulatory Reconciliation and Cooperation Table (RCT) has tasked the Federal/Provincial/Territorial (FPT) Food Safety Committee to work on the development of a domestic food safety recognition framework, similar to the CFIA's Foreign Food Safety Systems Recognition Framework. Once completed, this framework will enable provinces and territories to self-assess against federal criteria to determine if there are any gaps or areas where they may wish to align their food safety system.

For provinces and territories that choose to assess their food safety systems against the federal regime, the shift to outcome based requirements under SFCR will facilitate PTs assessment of their food safety legislation which is an essential component of the overall food safety systems assessment.

Once a province or territory undertakes a self-assessment of their food safety system against the federal regime, this will serve to determine if there are any gaps or areas that can be better aligned. At this point a determination can be made that a PT food inspection system is equivalent to, or exceeds, federal standards, leading to recognition agreements to formalize equivalence.

Provinces and territories will play a role in self-assessing systems against federal criteria, as well as making any necessary adjustments to achieve equivalence.

A tool to assess the equivalency of food safety systems is expected to be complete in spring 2019.

The development of the first recognition agreement to formalize equivalence of a provincial food safety system is anticipated no sooner than 2020.

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

The Economic Strategy Table (EST) report on the agri-food sector recommended that internal trade barriers on certification of organic standards, packaging, labelling and grading requirements be addressed in order to improve interprovincial commerce within Canada.

Specifically, actions were recommended in the following priority areas:

Certification of organic standards

There are national standards for labelling organic agriculture and organic aquaculture developed by the Canadian General Standards Board (CGSB). The Safe Food for Canadian Regulations (SFCR) incorporates both of these standards into the federal organic regime. Some provinces have organic regimes that make use of the CGSB labelling standards, but others do not. As a result, some manufacturers of organic food may face uncertainty when trying to label their products for different markets within Canada. The EST report recommends a consistent approach to the use of these standards across jurisdictions in Canada to create a level playing field.

Packaging and grade requirements

There are packaging and grade requirements that must be met in order for certain foods to move from one province to another or to be imported, while such requirements do not apply to foods shipped within a province. For example, there are limits on the size of shipment of fresh graded produce that can move across a provincial border before seeking a Ministerial exemption. The EST report has identified these as issues that affect productivity and efficiency.

Food labelling

The Economic Strategy Tables did not highlight a specific federal labelling requirement that is creating a barrier to internal trade. However, there may be certain provincial requirements that differ from federal requirements.

The Safe Food for Canadians Regulations (SFCR), which came into force on January 15, 2019, harmonized grade inspection requirements such that grade verification inspections will be applied consistently across Canada. Incorporation by Reference of grades in the SFCR will facilitate future updates, based on industry consensus. Additionally, the SFCR introduce provisions that enable foods with certain non-compliances, including with respect to grades, to be moved from one province to another on condition that the food is brought into compliance within 3 months.

With respect to organic, the CGSB standards are available for adoption by provinces and territories that may be interested in applying them within those jurisdictions. CFIA is available to provide information on the federal regime upon request.

With respect to packaging, the food labelling modernization initiative (presently called "food product innovation") proposed to repeal certain requirements for standard weights and container sizes, and modernize this framework by incorporating by reference the list of sizes to enable further updates. This would remove some of the current limitations on the movement of food across provincial borders due to prescribed package size requirements. Pre-regulatory proposals to this effect were consulted on in 2017, and a regulatory package to implement the food labelling modernization proposals is part of the CFIA's Forward Regulatory Plan.

The majority of federal food labelling requirements apply at all levels of trade in Canada and do not restrict trade between provinces. However, there are a limited number of trade and commerce related federal labelling requirements that apply only to specific commodities in international and interprovincial trade. These are referred to as commodity-specific labelling requirements. The CFIA's food labelling modernization initiative will streamline commodity-specific labelling requirements and reduce the number of these provisions. In some cases there may be differences in labelling requirements between provinces due to provincial requirements that are outside of the authorities of the departments and agencies involved in the federal regulatory review.

The grades and organic aquaculture issues were included in the work plan for the Regulatory Reconciliation and Cooperation Table that was created as part of the Canada Free Trade Agreement.

Issues related to consistency of organic standards for products traded intra-provincially rely on provincial and territorial adoption of the federal standard.

For food grades and organic aquaculture, these items were addressed (to the extent possibly at the federal level) when the SFCR came into force on January 15, 2019.

Food packaging changes will be made as part of food labelling modernization amendments. Pre-publication of these regulations is anticipated in spring 2019.

The CFIA's industry labelling tool provides additional information on grades and organic labelling.

Information on organic aquaculture is also accessible on the CFIA website.

More information on the food labelling modernization regulatory initiative (presently called "food product innovation") can be found in the CFIA's Forward Regulatory Plan.

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

The current "Product of Canada" guidelines allow this claim to be used on food when all or virtually all ingredients, processing, and labour are Canadian. All or virtually all is considered to mean greater than 98%. Some industry stakeholders believe that this high threshold reduces their ability to offer products identified as Canadian to consumers. Industry stakeholders have also noted that this level does not align with "Product of" claims for Canadian provinces or trading partners. For example, a food can be called a product of Quebec ("Aliments du Québec") with 85% Quebec content, but that same food would not be considered "Product of Canada.

The "Made in Canada" guidelines were also referenced in the Economic Strategy Table reports but were subject to fewer comments. "Made in Canada" claims can be made on a food when the last substantial transformation of the product occurred in Canada (for example, baking ingredients into a cookie), even if some ingredients are from other countries. If the "Made in Canada" claim is used, it must also include a qualifying statement to indicate that the food product is made in Canada from imported ingredients or a combination of imported and domestic ingredients. The qualifying statements that can be used include "Made in Canada from domestic and imported ingredients" or "Made in Canada from imported ingredients".

Based on feedback, the CFIA and AAFC will collaborate to review these guidelines.

AAFC will facilitate discussions with industry stakeholders aimed to achieve general agreement on potential new criteria for using the Product of Canada and Made in Canada claims on food, with CFIA support.

The CFIA and AAFC will also undertake work to validate any proposed changes to the policy with industry stakeholders and the public. Once validated, a revised policy would be implemented.

Any modifications to the guidelines on "Product of Canada" and "Made in Canada" claims would be intended to better reflect consumer and industry expectations and better reflect the reality of Canadian food production. Changes that enable more products to use the "Product of Canada" claim to highlight Canadian content could elevate the profile of Canadian products and may also help to advance the "Canada Brand" initiative, which is 1 of the 6 signature initiatives proposed by Canada's Economic Strategy Tables. Furthermore, revised guidelines may provide an incentive for Canadian companies to increase their use of the "Product of Canada" claim, which in turn could support increased demand for Canadian agricultural inputs.

Reviewing these guidelines will provide an opportunity to bring Canadian and provincial origin claims into closer alignment.

Innovation, Science and Economic Development Canada (ISED) maintains a similar policy on Product of Canada for consumer products other than food. The CFIA and AAFC will communicate with ISED on any potential changes to the "Product of Canada" and "Made in Canada" guidelines for food.

This work is planned to be completed in a medium term timeline (that is, up to 3 years).

The overall breakdown of the timelines is as follows:

The 2019 to 2020 fiscal year: AAFC will conduct industry engagement aimed at achieving general agreement on a new policy. AAFC and CFIA will then validate any proposed change to the guidelines with a broader group of industry stakeholders and the public. Following the consultations, recommendations will be provided to the Minister of Agriculture and Agri-Food Canada for consideration.

The 2020 to 2021 fiscal year: Implementation of new policy

The current Product of Canada and Made in Canada guidelines are accessible on the CFIA website.

Regulatory Policy Coordination Office
Strategic Policy Branch
Agriculture and Agri-Food Canada
Email: aafc.regulation-reglementation.aac@agr.gc.ca

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Grain sector stakeholders have asked the Government of Canada to launch consultations regarding a value creation mechanism to stimulate greater investment and innovation in Canadian cereal variety development.

Currently, due to the widespread use of farm-saved seed by producers, cereal variety developers are unable to generate sufficient revenue through initial sales of certified seed to recoup their R&D investment. A new value creation model could lead to increased funding in Canadian cereals research and variety development, benefitting farmers and other members of the value chain.

A new model could help to attract new sources of investment in Canadian cereals research and development of improved varieties, ultimately supporting greater profitability and competitiveness in Canada's cereals sector, including farmers.

Short term: AAFC/CFIA consultations will be completed prior to any regulatory proposals being drafted. These consultations began in November 2018 and are ongoing. No decision has been made at this time.

Medium term: If a decision is made to proceed after the consultations, proposed regulatory changes to support a new value creation model would be expected for pre-publication in Canada Gazette Part 1 for fall 2020.

Long term: Monitoring and reporting would be required to ensure that the value creation mechanism was benefitting producers and other industry stakeholders.

Regulatory Policy Coordination Office
Strategic Policy Branch, Agriculture and Agri-Food Canada
Email: aafc.regulation-reglementation.aac@agr.gc.ca

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Stakeholders have indicated that the process and timelines for pre-market assessments for agricultural inputs (feed, seed, fertilizer, veterinary biologics, plants with novel traits) are lengthy and unpredictable, which compromises efficient access to markets.

In response to the above issue, the CFIA proposes to:

1. Implement amendments to the Fertilizers Regulations, which would reduce the volume of products requiring pre-market assessment and lengthen the registration period in order to decrease burden [See Section 4, key issue 2 – Fertilizers Regulations]
2. Implement amendments to Feeds Regulations, which would reduce the volume of products requiring pre-market assessment. [See Section 4, key issue 1. – Feeds Regulations]
3. Streamline approval of new feed products, based on equivalency of authorizations by foreign governments. [See also Section 4, key issue 1. – Feeds Regulations].
4. Implement an electronic submission process for pre-market assessment of agricultural input commodities, reducing burden by enabling online application and payment, as well as automated case tracking (see Digital CFIA services).

Short term: Fit gap analysis (pre-market program review) and options analysis to determine current vs. required solution functionality (the 2018 to 2019 fiscal year).

Medium term: Internal and external change management activities (that is, business process re-engineering, communications) in support of the upcoming change to submission, review and issuance process. Industry enrolment in MY CFIA. IT system development, testing and deployment. Business continues to offer and support legacy processes (paper-submission) for those stakeholders unwilling or unable to submit applications electronically (the 2019 to 2020 fiscal year).

Long term: Information management, archiving disposal of paper documents, and setting rules related to document retention based on program requirements.

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Plant Breeding Innovations (PBI), also known as gene editing or new plant breeding techniques, refer to a suite of new technologies that can be used to efficiently introduce genetic changes. The seed and grain industry has identified that Canada's outcome-focused approach to determining which new varieties are subject to pre-market assessments causes uncertainty for the plant breeding community and that this may be a disincentive to investment and limit producer access to products developed using plant breeding innovation techniques.

Canada has a regulatory framework that effectively covers new technologies, but this flexibility does not lend itself to simple answers around whether or not a product may be regulated, particularly when the product is in the early stages of development. The industry states that, as a result, plant breeders do not make their best efforts to innovate, and Canada misses opportunities to nurture the development of innovative small businesses. To make investment and commercialization decisions that take advantage of new technologies, developers, as well as producers who wish to use and export those products, have indicated they require clearer and more predictable regulatory requirements around authorization prior to commercialization.

Many jurisdictions do not have the flexibility to capture these new technologies and are examining their frameworks, which add to the challenge of regulatory uncertainty for product developers in the global marketplace.

Canada's outcome-focused approach to novel products of biotechnology is unique. Consequently, since this framework was established (roughly 25 years ago), Canada has had the ability to regulate products of biotechnology that other regulatory frameworks do not capture. This flexible approach provides many advantages for ensuring appropriate stewardship, and can seamlessly accommodate new technologies without the uncertainty that other jurisdictions are currently working through. However, because the triggers are outcome-focused, product developers are less certain as to whether a specific product will be regulated.

Based on input from industry, the CFIA and Health Canada are working together to address issues raised by:

1. Providing more clarity around Canada's novelty triggers as they related to Plant Breeding Innovations, through written guidance.
2. Providing a well-defined process for consulting with regulatory authorities on whether a product is novel, including how to arrange a consultation, what information to provide, and the timing and format that the response from regulators will take. This will address the need for clarity and timeliness to help developers determine whether their product is regulated.
3. Considering opportunities to provide improved guidance on information requirements when a regulated product is submitted for pre-market assessment, and continue to find efficiencies in the pre-market assessment process, while ensuring safety. Canada already takes a flexible approach to information requirements, and allows the case for safety to be made using bridging to past submissions or published literature. Whether a more formalized tiered approach to information requirements, as requested by industry, is feasible is being considered as part of this work towards continuous improvement.

Furthermore, to support the above initiatives, Agriculture and Agri-food Canada (AAFC) is co-chairing an industry-government working group (the Biotech Working Group under the Grains Roundtable), which has been given the renewed mandate as of August 2018 to focus intensively on the PBI issue. The group worked to clearly define the problem and presented a draft work plan for consideration by the Grains Roundtable in March 2019. Options/solutions will be further developed with regulatory groups and AAFC. These discussions will provide a clear industry perspective to inform the CFIA and Health Canada actions identified above.

This action plan will address many of the points heard from industry around clarity and predictability. However, some points raised by industry will not be addressed, or may not be addressed to the extent that industry is seeking, as follows:

1. Providing certainty in advance through written guidance on what types of products are or are not novel, and being prescriptive about information requirements isn't feasible, as there will always be marginal cases or new developments that will require case-by-case consideration. However, Canada's approach in this regard allows developers the opportunity to present a logical case to justify why their specific product is not novel, and allows flexibility in what information is sufficient to demonstrate that a novel product is as safe as its counterparts.
2. Joint file review coordination between the CFIA and Health Canada. Industry is of the opinion that a co-ordinated file review between the three assessment groups (for use as food, as feed, and for environmental release) would be more efficient. The CFIA and Health Canada are interested in exploring all opportunities for improved efficiency, and have initiated pilot projects to determine whether certain joint review processes are feasible or result in efficiencies. If these pilot projects indicate that a joint review is more efficient, then joint review will be adopted. However, considering the different assessment endpoints and other complexities of safety assessments, this irritant may not be addressed to the extent that the industry would like, and any impacts on program efficiencies may be much smaller than industry appears to be anticipating.
3. Alignment with trading partners. The industry has also indicated an interest in seeing mutual recognition or aligned data requirements between like-minded countries. As described above, Canada's outcome-focused regulatory framework provides many advantages that would be lost if Canada were to undertake the complex work of adjusting our approach to be similar to more process-oriented jurisdictions. Globally, there is a great deal of variation in which products are subject to pre-market assessment. Canada will continue to work collaboratively with our international counterparts as we have done for many years in a variety of fora, with the goal of establishing areas of mutual agreement and harmonizing our systems where possible. While work-sharing and joint review is being explored in a very limited fashion between Canada and like-minded countries, the current global environment and diverse regulatory frameworks mean that this request will not be fully addressed. Obtaining authorizations in all major markets will remain an important step in the commercialization of novel products.
4. Data requirements for other product categories (for example crop protection products and animal health products) are not the same as data requirements for pre-market assessment of novel agricultural products. The assessment endpoints, and therefore the data used to meet those endpoints, are different. As outlined in the response plan above, the CFIA and Health Canada take a flexible approach to data requirements for novel products, and are committed to seeking opportunities to minimize regulatory burden, which could include a more formalized tiered approach, if feasible. This may partially address the request for streamlined data requirements, but extending this approach to different product categories is outside of the scope of this work.

Canada's safety assessment process for food is based upon principles developed through international expert consultations carried out by the World Health Organization (WHO) and the Food and Agriculture Organization (FAO) of the United Nations, the Codex Alimentarius Commission and the Organisation for Economic Co-operation and Development (OECD).

Questions and Answers on whether products of PBI are plants with novel traits were posted online in fall 2018. Additional improvements to guidance related to Plant Breeding Innovations are anticipated in 1 to 2 years (medium term) for some earlier outcomes, and longer-term for the more complex projects, with the following milestones:

• Options/Recommendations from the Biotech Working Group (mid 2019)
• Published guidance on Canada's novelty triggers in the context of PBI (within 1 to 2 years)
• Development of a better-defined process for consulting with regulators on novelty (within 1 to 2 years) Where feasible, explore further efficiencies around assessment processes and information requirements (longer term)

Improvements to the Seeds Act and Seeds Regulations to create clearer authorities for oversight of seed and release of novel plants may also be pursued as a separate but related initiative; this work will have a longer-term implementation timeline (3+ years).

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Food Directorate
Health Products and Food Branch
Health Canada
Email: hc.food-aliment.sc@hc-sc.gc.ca

Stakeholders have indicated that the process and timelines for CFIA services are cumbersome, paper based, lengthy and unpredictable, which creates complexity and additional cost, compromising competitiveness.

Enabling new processes for permissions, export certification, and inspections through the use of technology, the Digital Service Delivery Platform (DSDP) project, is an essential component of CFIA's transformation strategy.

DSDP will standardize and automate processes, provide services on-line, support planning, tracking, and assignment of activities; and provide improved business reporting capabilities. The platform provides a set of technologies and tools for citizens, industry, international trading partners, and CFIA inspectors to more readily carry out their respective roles and conduct regular business transactions.

Full implementation of the Digital Service Platform will be carried out over a three-year period sequenced as follows:

2018 to 2019 fiscal year – Full regulatory lifecycle – Food business line

Licensing, Inspections in support of Safe Food for Canadians Regulations – which came into force January 2019.

2019 to 2020 fiscal year – Enabling market access

Export Certificates – Dairy (June 2019); Additional Commodities; Plants, Seafood, Live Animals

Digital Exchange of Export Certificates (Phytosanitary Hubs)

Pre-market approvals (Seeds (Variety Registration), Feeds, Fertilizers, Veterinary Biologics, Plant Biosafety Office (PBO))

Import Permits – Food and Plant Business Lines

2020 to 2021 fiscal year – Full regulatory lifecycle – ALL Business lines

Export Certificates – Remaining Commodities

Digital Exchange of Export Certificates – Strategic Trading Partners

Inspections – Plants and Animals

Emergency Response

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

The Canadian Food Inspection Agency's risk-based approach to inspection oversight and frequencies has not fully integrated third party oversight into overall risk assessment and the inspection model. Often the standards set by these third party oversight regimes exceed regulatory requirements. An opportunity exists to better recognize investments that industry has made in third party certification systems through the application of a risk-based approach to oversight that gives industry "credit" for implementing such programs. This may include fewer or faster inspections, consideration of third party audits in the application of inspection oversight, etc.

The Economic Strategy Table (EST) Report recommended that a panel of industry experts advise regulators on various items, including opportunities for efficiencies, including alternate service delivery, compliance strategies and third party accreditation. This proposal would position the CFIA to discuss third party oversight and seek advice from such a panel.

The CFIA developed a Private Certification Policy for food safety in 2015. This policy provides direction on how industry's investment in an appropriate private certification scheme would be considered within the CFIA risk-based regulatory framework.

As part of this model, the CFIA assesses the requirements of private certification against food safety regulatory requirements. For example, in 2017, the CFIA's Food Safety Recognition Program recognized the Canada GAP program for fresh fruit and vegetables.

The CFIA has also started considering private certification of establishments as one of several factors in risk based planning. For example, as a result of risk-based prioritization, Canada GAP certified establishments are subject to fewer inspections than non-certified establishments.

In addition, the CFIA's Establishment Risk Assessment (ERA) Model recognizes third-party certification as a risk mitigation factor in its algorithm. A lower risk result means that an establishment will not be inspected as frequently and the scope of the inspection is reduced.

Going forward, the CFIA plans to:

1. Communicate to industry how the CFIA is using third-party certification for work planning
2. Assess more private certification programs against Canadian food safety requirements

Benefits of this approach include reduced duplication of oversight between third parties and the CFIA, as well as strengthened trust. Overall, food safety oversight is improved as it is a tool that enables the CFIA to focus inspection on higher risk establishments.

The United States Food Safety Modernization Act recognizes accreditation of third-party certification bodies to conduct food safety audits. The program was implemented in 2017.

Short term (within the next year):

• The CFIA will continue its work on taking third-party certification into account in risk-based inspection planning.
• The CFIA will continue to assess private schemes. It is expected that 1 to 2 schemes will be assessed per year.

The Agency's ERA model's algorithm considers third party audits and international certification schemes as a mitigation factors, the measures or strategies that a food establishment is using, to reduce the inherent risk and therefore reduce the risk of a food safety issue. Further information about the ERA model can be found in The science behind it: The Establishment-based Risk Assessment (ERA) model and The CFIA Chronicle.

The Food Safety Recognition Program (FSRP) includes the On-Farm Food Safety Recognition Program and the Post-Farm Food Safety Recognition Program, which provides government recognition of on-farm and post-farm food safety systems developed and implemented by national industry organizations on a voluntary basis. This program acknowledges that a food safety program has been developed in line with a systematic and preventive approach to food safety based on international accepted standards.

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Regulated parties have expressed some concerns around the consistency of inspection and/or enforcement activities by the Canadian Food Inspection Agency.

The CFIA is in the process of implementing a number of internal initiatives to improve consistency of delivery, including:

1. Implementation of Standard Inspection Process – Inspectors use a combination of onsite inspection and evaluation techniques for assessing compliance and evaluating the impact of non-compliance of regulated parties. Verification activities can include making visual observations, evaluating documentation, interviewing personnel, sampling, measuring, testing, and commodity inspection. Ensuring that we have a Standard Inspection Process (SIP) for the use of these techniques will provide inspectors with the flexibility to adapt to different situations that may arise during an inspection within a consistent framework. CFIA has rolled out this standardization exercise initially in the food sector with the implementation of the Safe Food for Canadians Regulations and will continue into the Plant and Animal Health sectors. Using the same approach for inspection through standardized procedures will enhance consistent outcomes and predictability for regulated parties.

   Time line – Plant and Animal Health (2019 and beyond)

2. Provision and implementation of updated operational guidance. Operational guidance (also referred to as operational policy) is the instrument or practice by which the CFIA Operations Branch ensures consistent delivery of programs for inspectors and investigators (which will also be available to the regulated parties). An exercise to ensure this guidance is up to date and consistent will result in consistent decision making, consistent regulatory outcomes, and transparent and predictable enforcement actions for regulated parties. Operational inspection guidance updates have been made for inspections of food commodities as this was a key success factor in the implementation of the SFCR.

   Time line – Compliance and enforcement guidance, including guidance in using various enforcement tools (such as AAMPs) is ongoing. It is also expected that incremental changes will occur in the longer term for Animal and Plant Health inspections (2020 and beyond).

3. Provision of updated training for inspectors and investigators. Updating guidance to our inspectors will necessitate updates to the training we give our staff. Training already occurs, but as changes to operational guidance are incrementally implemented, inspectors and investigators are receiving updated training. This will ensure that updates to our procedures are well implemented resulting in clear and consistent application by our inspectors in the field.

   Time line – This activity has started in support of SFCR implementation, and is ongoing as we continue the incremental changes to our guidance.

4. Adoption of the Digital Service Delivery Platform. The Agency is investing in a single digital platform for the capture of inspection activities and to provide as better on line tools for inspection staff and regulated parties. This system will result in improving data quality and trends analyses. This improved data availability will inform the inspectorate in a more rigorous way when doing their inspections, resulting in more focussed inspections based on risk and more consistent delivery of inspections. For more information, see Digital CFIA services.

   Timeline – Medium term to longer term. (2019 and beyond)

Has been implemented for Food. Will be implemented in the next 2 years and beyond for Plant and Animal Health, aligned to associate regulatory initiatives in these business lines.

Data capture platforms development is in progress using an incremental approach, so completion and roll out across all sectors is expected to be medium to longer term (that is, 1 to 2 years and beyond). See the Digital CFIA Services initiative (above) for more information.

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Duplication of federal or federal/provincial oversight increases regulatory burden for businesses, and can impede the competitiveness of Canadian businesses.

The CFIA is working with the provinces to avoid duplicating food oversight as the Safe Food for Canadians Regulations (SFCR) have taken effect, and is taking Part In developing inspection information sharing protocols.

To that end, the CFIA has undertaken a number of initiatives with the provincial authorities, including:

1. New FPT agreements between the CFIA and the provincial departments have been signed (or are being negotiated) to ensure food safety, animal health and plant protection in Canada (FPT "Umbrella Memorandum of Understanding (MOU)"), in line with 4 strategic priorities: information sharing, regulatory collaboration as a move toward harmonization, emergency management and scientific collaboration.

   Timeline: Signed in 5 provinces (as of May 29, 2019). To be finalized in 2019 to 2020 (1 year)

2. The CFIA is working with Quebec's Ministère de l'Agriculture, des Pêcheries et de l'Alimentation du Québec (MAPAQ) on a new inspection agreement for the regulated parties targeted by the new Safe Food for Canadians Regulations (SFCR). The goal is to have a single point of contact carrying out inspections. The industry will deal with a single inspection authority (CFIA or MAPAQ).

   Timeline: 2019 to 2022 (3 years)

3. Cooperation on the development of tailored inspection tools, which takes into account the fact that in some provinces, the designated provincial inspectors enforce federal regulations administered by the CFIA. This includes:

   • Developing inspection directives and joint training designed to qualify the designated inspection staff and ensure consistent enforcement.
   • Digital Service Delivery Platform project with MAPAQ to provide access to information on shared regulated parties under CFIA and MAPAQ inspection agreements. This includes provincial and federal licensing and certification in the food, animal health and plant protection sectors.

   Timeline: 2019 to 2024 (5 years)

4. Planning of joint inspection and surveillance activities, particularly with regard to testing for chemical residues in food. Elimination of surveillance program duplication and recognition of partner testing whenever possible.

   Timeline: Ongoing.

5. Integrated risk management: Sharing of the CFIA's integrated risk management models with the provinces. Work on this has begun with MAPAQ with a view to possible harmonization. This would make it possible to engage in similar inspection activity planning and prioritization for fair treatment of regulated parties.

   Timeline: 2019 to 2024 (5 years)

The timeline for each initiative is indicated above and is shown as short-term (1 year) or medium/long-term (3 to 5 years). The priority is the food sector (SFCR inspection agreements), but it takes into account the tools to be put in place and rolled out across all sectors, including animal and plant health.

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Stakeholders have indicated that the Government of Canada does not seem to consider the cumulative impacts of regulatory changes made across federal departments as they relate to food labelling. These changes can have a significant economic impact on the industry. If coming into force timelines are misaligned, industry may need to adjust labels on food products more frequently than is practical.

Consumers use food labels to make more informed choices about the food they purchase. Both Health Canada and the CFIA are responsible for labelling policies in Canada. Health Canada is responsible for labelling requirements with respect to health, safety and nutritional quality of food sold in Canada (for example nutrition facts table, allergen labelling, nutrient content claims) while the CFIA sets out non-health and safety related labelling requirements (for example organic claim, net quantity, date labelling).

Health Canada and the CFIA will address this issue by developing a strategy to coordinate timelines for food labelling changes.

Through the recent changes to nutrition labelling, labelling changes being developed through Health Canada's Healthy Eating Strategy and the CFIA's food labelling modernization (presently called "food product innovation"), Health Canada and the CFIA have made concerted efforts to align the timelines for the changes being proposed and provide a transition period to minimize economic impact on the industry. However, there is an opportunity to develop a more formalized approach to ensure that both departments coordinate timelines for future labelling changes in a manner that can provide industry with greater clarity and predictability.

In any formal or informal process, the Government of Canada will need to maintain the flexibility to implement labelling changes related to health and safety, especially in response to health needs.

Health Canada and the CFIA will look to labelling alignment timing practices in other international jurisdictions to inform the development of a strategy in Canada.

Health Canada and the CFIA will work together to continue to align timelines for the labelling changes proposed in the Healthy Eating Strategy and the Food Labelling modernization initiatives. A predictable cycle for label changes will be implemented subsequent to these proposed changes coming into force.

Consultations with stakeholders will begin in the 2019 to 2020 fiscal year to establish appropriate timeline for a predictable cycle.

Health Canada and the CFIA will establish the timelines in consultation with various stakeholders.

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Food Directorate
Health Products and Food Branch
Health Canada
Email: hc.food-aliment.sc@hc-sc.gc.ca

Some stakeholders have expressed concern that the negotiation and arbitration process relating to compensation for relying on data on pest control products belonging to other parties during pre-market reviews is insufficient to help parties to reach compensation agreements in a timely manner in all cases. Further, the requirements of the post-market data protection program for pest control products are unclear to regulated parties.

Health Canada will address the process for settling data protection compensation for pre-market reviews of pest control products by updating the "Ministerial Agreement" (a document issued by the Minister under s. 66 of the Pest Control Products Act that sets out the details of the negotiation and arbitration process for pre-market data protection compensation).

Health Canada is also proposing to amend the Pest Control Products Regulations to clarify the data-protection provisions that apply during post-market reviews of pest control products.

Health Canada published the updated "Ministerial Agreement" for consultation in fall 2018, and published the final version in April 2019. A draft update was previously consulted with stakeholders in winter 2016 to 2017, and industry comments were used to develop the fall 2018 consultation draft.

With respect to amending the Pest Control Products Regulations, Health Canada recently concluded industry consultations on the proposed approach to data protection during post-market reviews. Health Canada is targeting the pre-publication of draft regulations in the Canada Gazette, Part I in fall 2019 / winter 2020. Publication in the Canada Gazette, Part II is targeted for 2020.

Policy and Regulatory Affairs Divisions
PMRA, Health Canada
Email: pmra.regulatory.affairs-affaires.reglementaires.arla@hc-sc.gc.ca

The Federal regulatory review consultations in the Canada Gazette, as well as recommendations from the Agri-Food Economic Strategy Table and other recent regulatory modernization efforts have pointed to the opportunity to improve Canada's regulatory environment to foster innovation, growth and competitiveness for the agriculture and agri-food sector while maintaining health and safety objectives.

Stakeholder submissions as part of the regulatory review process echoed recommendations from the Agri-Food Economic Strategy Table and stressed the need to: take immediate action on tackling ongoing irritants; address the cumulative economic impact of regulations; and, test new technologies through regulatory experimentation.

In addition, stakeholders re-iterated concerns over the clarity of regulations, the need for earlier and more meaningful engagement in regulatory development, an opportunity to better consider cumulative and economic impacts of regulations; and difficulty navigating the regulatory system.

AAFC will explore opportunities to improve government-stakeholder collaboration on regulatory issues facing the agriculture and agri-food sector.

To support efforts to create a more agile regulatory environment, further government-stakeholder collaboration will be explored in order to facilitate shared solutions between government and industry regarding regulatory irritants (that is, timely, predictable solutions) and to seize opportunities to work collaboratively with industry (that is, regulatory design for new and emerging technologies), to enhance economic growth and competitiveness.

AAFC will look to provide a focal point for identifying and helping to solve agriculture and agri-food regulatory irritants, provide analytical capacity to better understand cumulative and economic impacts of regulations across the sector, explore ways to make the regulatory system easier to navigate, and contribute to regulatory experimentation in the agriculture and agri-food space. This initiative is intended to strengthen efforts in the following areas: supply chain regulatory burden mapping, artificial intelligence for regulatory policy and decision-making insights, designing agile regulations suited for transformative technologies and new products and processes that may not fit under current regulatory frameworks.

Any sector-specific regulatory approach would complement broader Government of Canada mechanisms to support system-wide changes and the creation of distinct spaces for regulatory experimentation and innovation.

AAFC plans to work with relevant departments and agencies to facilitate collaboration between government and stakeholders regarding regulatory irritants and opportunities that are impacting economic growth and competitiveness.

AAFC is planning to have discussions with relevant departments and agencies in 2019.

Regulatory Policy Coordination Office
Strategic Policy Branch
Agriculture and Agri-Food Canada
Email: aafc.regulation-reglementation.aac@agr.gc.ca

Due to the complexity of globalized food supply chains, processing technologies, food fraud and international trade, the transparency and electronic enablement of food supply chains and the information associated with them have never been so important to the safety, integrity and value of what Canadians eat and produce.

The agri-food and agriculture industry is currently undergoing a supply chain digital transformation. A digital supply chain means that the series of activities that are connected like the movement of raw materials, goods and parts from the supplier to consumer and the associated financial, material and information are enabled with digital technology.

Regulated parties create and manage data through industry-based digital supply chain platforms that would assist the CFIA in its risk management and service delivery capacity. This includes compliance data on the regulated party derived from other jurisdictions as well as product history, origin and other relevant supply chain information. Historically, the CFIA and regulated parties do not voluntarily share data.

Legacy technologies related to data storage and management have also contributed to the challenges associated with the transmission and storage of the data across supply chain participants and between the regulator and regulated parties.

To date other international counterparts have already indicated their intention to further explore the use of blockchain technology in the regulatory space. That is because blockchain allows for flexibility in the type of data that is shared between regulator and regulated party which could include traceability, firm identity, production and supply information, laboratory analysis results, or third party certifications or permissions among others. Based on the type of information that is shared, the performance of multiple regulatory functions, like issuing permissions or response, could be sped-up and streamlined.

The Economic Strategy Tables specifically recommended undertaking a pilot in this area.

Despite evidence that distributed ledger technologies could enable the desired secure, transparent and confidential sharing of information between parties, it is still relatively new and the implications of the deployment of the technology and as a regulatory tool are not well understood. It thus requires further research and experimentation, which will be enabled by this sandbox approach.

The CFIA is proposing to create a regulatory sandbox with the aim to reduce risk to food safety/plant/animal health by increasing collaboration and trust between regulator and regulated parties through improved information and data sharing. This sandbox would include the adoption of a data-exchange platform using distributed ledger technology ("blockchain").

Distributed ledger technology ("blockchain") is a disruptive technology changing the way buyers and sellers transfer assets without the involvement of a third party administrator. Blockchain is a digital database that securely transmits any type of information without a central authority. In absence of a central authority, information is transferred directly from user to user. The information is validated by the computers on the network using algorithms. Distributed ledger technology could address issues of cost, quality, trust, and security.

This sandbox project will look to assess the feasibility of the blockchain technology at the CFIA by engaging with technical and industry experts to a) develop a detailed description of how the technology could be used at the CFIA in order to assess the feasibility of the technology to perform the intended functions; b) identify legal and policy implications of adopting this type of approach; c) recommend a potential strategy for future development.

Relative to food safety, the CFIA is interested in the application of blockchain for supply chain management. It could potentially allow for more preventative risk control measures, and enable quicker and more precise interventions to preserve human health and safety. There may also be potential in using blockchain to possibly support the traceability requirements of the new Safe Food for Canadians Regulations, as well as the prevention of food fraud.

For the purposes of the pilot, CFIA would seek collaboration with other agencies/departments as well as potentially industry to deliver on the project.

Short term (year 1): The objective of the short term work will be to build capacity, engage with and create a network of key stakeholders as well as to collaboratively design and implement the sandbox project.

Experiment with an actual blockchain (or prototype) with the regulator and regulated party to test a number of assumptions as well as ascertain real evidence as to the complexity, value, challenges and costs associated with the use of blockchain technologies for regulatory oversight.

The project will be sufficiently complex to test various aspects of regulatory application to identify and evaluate numerous implications, but will also look to leverage supply chains and technologies that are already advancing. The results and analysis of the pilot will inform policy decisions for the CFIA and reference findings for other regulatory agencies on the usefulness and adoption of ledger technologies in a regulatory context.

Medium Term (Year 2): The objective of this second phase of work will be to analyze the results of the previous project, and further consultation and engagement with stakeholders to identify key opportunities and challenges. Given the outcomes of these analyses, a decision will be required to determine the feasibility of advancing work under this initiative including broader external consultation and engagement.

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca

Regulators in Canada are exploring a new approach to providing oversight and enforcing regulation to better align with industry commitment to complying with regulatory requirements. The approach recognizes that most businesses want to meet regulatory requirements and keep their customers safe, and that they are more likely to be readily and actively compliant when they are part of a system, which encourages them to do so.

This new type of regulatory relationship enables regulators to deepen collaboration with businesses that create and maintain trust with customers and regulators (for example, through consistent application of compliance systems and audits, high number of satisfied customers, transparency and commitment to core values). This type of relationship encourages trust and open sharing of information, while mitigating fear of reprisal when regulated parties self-identify risk or non-compliance. It leverages industry's vested interest (by way of reduced costs, reputation, profits/sales, and growth) to ensure risks are well managed and provides a new opportunity for regulators to explore innovation in regulatory delivery and compliance.

This new approach will explore when and how a regulator can place greater trust in an operator's ability to control risk and to provide data and information on their performance. This could allow strong performers to be monitored offsite and inspected less frequently, and regulator efforts to be redirected instead to weaker performers with repeat compliance issues, or to focus on other key areas of risk. The enhanced information sharing enables the regulated party to signal any emerging issues or trends with implications for the broader sector to the regulator, who can in turn adjust its oversight and reach out to the sector to better understand and manage risks.

The CFIA proposes a pilot approach with a willing industry partner to explore a relationship that encourages compliance and enhanced information sharing in support of shared risk mitigation goals.

The proposed pilot involves a company, facility, establishment or industry association who can be considered a leader in their sector, exemplifying qualities and business practices that other businesses could model themselves after. The chosen partner should:

• have a positive working relationship with the CFIA
• be willing to be open and transparent about their business practices
• be agreeable to sharing information on their activities
• provide, where possible, useful insights and intelligence that could help the CFIA take a proactive approach to mitigating risk

The CFIA would develop a proposal to scope the pilot, along with terms and conditions including how industry information will be used. The data collected from pilot companies will point to new, collaborative and intuitive ways of identifying and addressing non-compliance. The approach will also encompass best practices for forging and maintaining relationships with companies and businesses who effectively and efficiently comply with CFIA requirements. Following the pilot, a report would be developed that summarizes the findings, along with best practices and areas requiring further refinement or adjustment should there be interest to expand the pilot.

This pilot explores a cultural shift between regulator and industry by developing trusting relationships that serve to benefit both parties by way of improved data exchange and enhanced transparency.

In the medium-longer term other government departments that carry out inspection activities may be implicated as there is likely to be a larger interest in this pilot from other members of the regulatory community, including the Community of Federal Regulators.

In the short term (within 1 year), the CFIA would demonstrate the feasibility and benefits/risks of using deeper industry collaboration and data-sharing as an effective approach to improving compliance. The Agency would establish the necessary supports to launch the pilot including data sharing, information management/technology support, governance agreement and clear articulation of pilot deliverables including replication analysis and recommendations.

In the Medium Term (1 to 2 years), the CFIA would conclude delivery of the pilot and would finalize the result analysis including recommendations for continuation, further refinement, feasibility for adoption and recommendations including any on-going costs or additional resourcing required for expansion (if the pilot is deemed successful).

Regulatory, Legislative and Economic Affairs Division
Policy and Programs Branch
Canadian Food Inspection Agency
Email: cfia.legislation-legislation.acia@inspection.gc.ca