October 15, 2013 | In: General

What Constitutes “Made in Canada”?

Many Canadians think that when a product is labeled as “Made in Canada”, then this means that every single component of that product is Canadian. This cannot be further from the truth. In fact, a product labeled as “Made in Canada” can have all of its products from a foreign origin. Let me explain…

The Canadian Competition Bureau states that manufacturers are allowed to stick the “Made in Canada” label on their products if:

  • The product’s last substantial transformation occurred in Canada AND
  • At least 51% of the costs incurred to create the product took place in Canada.


Probably your first question would be, what do they mean by last substantial transformation?

Let’s assume that you have a Quebec company called Troupeecano which sells orange juice in milk-like containers. Troupeecano imports the orange juice from the United States, and the containers from China. Now, once its have the goods in its Quebec factory, Troupeecano then mixes the United States orange juice with some water and sugar, puts it in the containers, and sells it to the public. That last step is the substantial transformation of the product, and it did indeed take place in Canada.

Troupeecano incurs about 60% of the costs of producing the canned juice in Canada – and this allows Troupeecano to stick a Made in Canada label on a Chinese made box with a US made juice. In short, when something is labeled as Made in Canada then it should really read as Packaged in Canada – but hey, that’s how things work.

But, what is really made in Canada?

When something is really made in Canada, it will say Produce of Canada. A product is eligible to be a Produce of Canada if:

  • The product’s last substantial transformation occurred in Canada AND
  • At least 98% of the manufacturing/producing costs were incurred in Canada

Of course, the latter condition makes it really hard to buy something from China, package it in Canada, and sell it as Produce of Canada (unless, of course, you are buying something from China for $2 and it’s costing you $98 to package it in Canada). That’s why anything that has a “Produce of Canada” sticker is usually a carrot or a potato. Which takes me to the heart of the problem…

Most of Canada’s goods produced, including food and clothing, are not really made in Canada (even though technically they are). They are just assembled/packaged/sewn in Canada – their components are made elsewhere (usually China). This is a huge issue – we depend on other countries to eat and to be warm, which is a really dangerous strategy, because it makes us at the mercy of these countries.

I think Canada must and can be self-dependent. I think that Canada can produce a car from scratch – with no components whatsoever from other countries, I think that Canada can produce a laptop from scratch, I think that Canada can grow its own food and then package it and sell it to its residents and the world. Canada can be all that (because it has all the needed resources) – and once Canada becomes that, it’ll be an extremely powerful nation and a beacon for other countries who want to do the same but are afraid of doing so because it’s just too hard.

The problem is that nobody sees a problem with how things are at the moment, and this is not just in Canada, but in every country in the world, except of course, China.

This article (as well as all other articles on this website) is an intellectual property and copyright of Fadi El-Eter and can only appear on fadi.el-eter.com.

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