Thank you, Madam Chair and members of the committee, for including the Canadian Association of Importers and Exporters on your agenda to allow for input on this important study.
My name is Kim Campbell. I'm the past chair of our association. We are national trade organization that has been speaking on behalf of the Canadian trade community for almost 90 years.
Since we last met, the CBSA has revised policies that will ensure our border is not completely disrupted on May 13, the current proposed implementation date. We are grateful to the committee for taking on this study and providing industry a forum to discuss remaining large-scale issues.
It was disappointing to hear the CBSA on Tuesday mis-characterize business by making multiple statements that we are not ready, that we are resistant to change and that we just want to maintain the status quo. Four of the witnesses before you today have implemented multiple CBSA IT initiatives over many decades. One of us implemented the current release system you heard about on Tuesday, called ACROSS, while at the CBSA.
Our experience with CARM is not like that of any other project we have undertaken before. The state of this project, with all its delays, lies squarely on the shoulders of the CBSA. The inconvenient truth is that they did not follow a known IT project methodology and, as such, have left us all in a state of not being ready to implement on May 13, because the CBSA has not created an environment for success.
We have submitted comments and would like to highlight a few key areas and recommendations.
We believe the system is not ready. There have been three rounds of controlled testing. Each round has been extremely frustrating, as the process and test scripts have been filled with errors and confusion. This behaviour was experienced at each testing phase to include items that were to be corrected but were not corrected.
The limited number of testers controlled by the CBSA are reporting that a basic accounting filing seems to be stable, but all other items are still an issue. We are still seeing many instances of the system not calculating the duties and taxes correctly.
Fewer than 100 companies have access to the CARM R2 system via testing. This means that the remaining just under 200,000 importers and their service providers will be seeing CARM R2 for the first time when it goes live. This will mean that the amount of support required and system tickets that will be submitted will be more than the CBSA can manage. They have not demonstrated that they have the capacity to manage the fewer than 100 companies testing to date, let alone the massive influx that will occur when it goes live.
They are still changing requirements and providing guidance on core functionality as we speak. They released a revised technical specification document on February 5, which required system changes.
There is an insufficient scale of importers and software companies registered and certified for CARM. The last number of certified software companies was three. There are 11 software companies that the CBSA has stated they still have no communication with.
We did receive the regulatory package on March 13 and have received 22 policy documents over the last few weeks: so much to understand and digest while trying to figure out CARM to include the transition strategy that we are all still waiting for. We know there will still be many more things to come.
I would like to conclude with our recommendations.
We believe the time has come to appoint an independent third party to oversee the project. Too much time and money have been spent on both sides of the fence. We have no confidence in where we are now, and if the CBSA still insists on implementing on May 13, there will be extreme stress imposed on industry in trying to figure it all out.
We will need a third party that can be the oversight and lead us all out of what we inherit. Our preferred hope would be for this party to evaluate where we are and craft a mutually agreed-upon road map to implement responsibly, and that may include a solely Government-of-Canada solution. We have seen a similar pattern of behaviour as was recently reported by the Auditor General on ArriveCAN and believe that we need to have this project also reviewed.
We ask for your support in recommending that the Government of Canada and the CBSA implement CARM responsibly by providing a parallel system allowing importers and service providers that are ready to proceed on May 13. By moving away from the big-bang approach, we will significantly decrease the risk of a flawed implementation.
We look for your support to recommend that the Government of Canada eliminate the GST for resident Canadian importers on the cost of acquiring a customs bond.
We would recommend a review of the CBSA's decision to have Canada's most sensitive protected B trade data on a system outside of the Government of Canada and managed by third party non-government vendors, including the decision to outsource and pay for the use of the software.
We are committed to modernization and a best-in-class border but need the support of the committee and the Government of Canada to ensure we can achieve the best outcome for all Canadians, and without your assistance we do not believe that will happen.
I look forward to answering any questions you may have.