How Trade Between Canada and the US Benefits Both Economies

Similarities across culturesBusiness owners are lured to conducting business in Canada for a variety of reasons, but its familiarity is perhaps the most compelling. Many cultural practices between the United States and Canada are similar; for instance, handshakes are expected during greetings in both countries, but bows are more common in Eastern nations like Japan. In the primarily Anglophone areas, the United States likewise has a similar population and speaks the same language. Because of these similarities, expanding your company in Canada is far simpler than in many other nations.reduced rates of corporation taxNumerous corporate perks are also included, not the least of which is a reduction in corporation tax rates. Over the previous nine years, Canada has gradually lowered its tax rate from 18% to 15%, which is currently one of the most competitive corporate tax rates in the world (compared to the U.S. tax rate of 21%), in an effort to promote economic growth and draw in foreign industry.Trade agreements with CanadaEntrepreneurs looking to grow in Canada will also profit from its extensive trading network, which gives Canadian businesses first dibs on a variety of international markets. The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the Comprehensive Economic and Trade Agreement (CETA) with the European Union, and the North American Free Trade Agreement (NAFTA) are among the trade agreements that apply to Canada.safeguards for intellectual propertyAn additional benefit for firms operating in Canada is their dedication to innovation and their efforts to enhance their intellectual property (IP) laws by lowering red tape and simplifying processes for domestic enterprises.

Canada became a member of the Hague Agreement in 2018.

The government has consented to ratify a number of other international intellectual property treaties this year, including the Nice Agreement, the Madrid Protocol, the Singapore Treaty, and the WIPO Patent Law Treaty.Expert advice: Even though the legal systems of the United States and Canada are comparable, it is nevertheless crucial for growing companies to secure their intellectual property. Intellectual property is not globally protected by any international patent, copyright, or trademark. Existing patent and trademark protections in the United States are insufficient to safeguard intellectual property in international markets because all IP rights must be registered and upheld under local laws. It's also critical to move quickly to preserve intellectual property. Companies that depend on the United States government to mediate intellectual property issues may discover that their rights have diminished or expired as a result of legal theories including laches, statute of limitations, and estoppel, among others.carrying out filings and lien searchesAs one of the few countries that seems to meet UCC Article 9 requirements, businesses moving to Canada can benefit from a high degree of confidence in lien searches and filings.Even while the Canadian and American systems are nearly identical, there are still some possible hazards to be aware of. For example, Canada only accepts electronic filings and does not permit the submission of copies of filings. Also, compared to what is normally seen in the United States, collateral descriptions are frequently shorter and less accurate.

Please go to Performing Lien and Court Searches outside the U.S. for further details.

The risks and drawbacks of conducting business in CanadaGetting around provincial lawsAlthough there are many advantages to growing in Canada, astute business owners should also take into account any potential difficulties. Navigating the laws of Canada's 10 provinces is one such issue. Provinces have their own governments and resemble states in the United States. Therefore, growing businesses need to take into account not only federal laws, rules, and taxes, but also provincial laws and levies that are imposed.Each province has different labor rules, which affect how employee contracts are structured. The most significant difference is to Quebec, a language spoken in French, where the common law system is replaced with a civil law system. All paperwork and filings related to operations in Quebec must be done in French, and all employees operating there need to be fluent in the language. Businesses located in Quebec also have to pay the regular Goods and Services Tax (GST) in Canada in addition to the Quebec Sales Tax.Cultural distinctionsAlthough there are many similarities between the United States and Canada, businesses should be aware of the fundamental distinctions. It is considered impolite to act as though Americans and Canadians are interchangeable. These two countries are not comparable.There are notable cultural distinctions, especially in Quebec, where people tend to be more formal and quiet. Along with relevant academic titles and degrees,

business cards should have translations in both English and French.

Recognizing the needs for business licensesBoth the United States and Canada have similar licensing regulations, which heavily regulate certain areas like engineering and architecture. In Canada, professional licensure necessitates extensive coursework and demanding assessments. Furthermore, different governmental levels offer licenses and permissions, thus growing companies need to make sure all the necessary conditions are fulfilled.The application procedure also covers essential business permits. Any new business entity in Canada must apply for a business license in the appropriate jurisdiction, just like in the cities, counties, and states of the United States. Remember that some Canadian sectors have longer permitting processes. For instance, getting a permit in the building industry can take up to nine months on average. In Quebec, special construction permissions are needed, so the procedure is even more drawn out.