Canada - Commercial Guide
Market Challenges

Learn about barriers to market entry and local requirements, i.e., things to be aware of when entering the market for this country.

Last published date: 2020-08-03

Canada’s subtle but important differences from the United States can trip up the unprepared. Some sectors are restricted or inaccessible to foreign imports. U.S. exporters must conduct due diligence on market potential, understand differing provincial regulations and sales channels, and comply with bilingual labeling and packaging requirements, certification standards, and Canadian customs procedures.

Opportunities exist to sell to the Canadian government. Federal, provincial, and municipal procurement procedures, although open in principle to U.S. bidders, vary from the procedures in the United States. Bidders must be registered in Canada to bid and must fulfill all Canadian requirements to be awarded contracts (mandatory requirements are non-negotiable). In some cases, security clearances are required for personnel prior to submitting a bid, and in defense projects there may be requirements for offsets, known as Industrial and Technological Benefits (ITB). 

Increasing competition in several sectors such as cosmetics, vitamins, electronics, and home furnishings translates into a need for competitive pricing, provocative and imaginative marketing, and deep discounts for agents and distributors. Other ways to differentiate from your competitors are to offer agents and distributors specialized training and flexible contract terms, or to offer end users after-sales support.

It is important to have an overall strategy to protect your Intellectual Property (IP). IP may be protected differently in Canada and in the United States, and the scope of protection may be different. Rights must be registered and enforced in Canada under local laws. It is vital that companies understand that intellectual property is primarily a private right and that the United States government cannot enforce rights for private individuals in Canada. It is the responsibility of the rights holders to register, protect, and enforce their rights where relevant, retaining their own counsel and advisors. Small and medium-size companies should also understand the importance of working with trade associations and organizations to support IP protection and stop counterfeiting.