Anyone who runs a small business in Canada has experienced the frustration of jumping through hoops, ducking under red tape, and leaping regulatory hurdles.
But Chilliwack poultry farmer Ken Falk has an example of government over-regulation so over the top, so egregious, it received one of the Canadian Federation of Independent Business’s 2020 Paperweight Awards highlighting the worst examples of over-regulation facing Canadian businesses.
Falk runs Fraser Valley Specialty Poultry in Yarrow. The company fills hundreds of orders a week for chicken, duck and goose to buyers all over British Columbia. What exactly those buyers do with that product is, of course, a mystery to Falk and, frankly, none of his business.
So when Falk was fined $42,000 by the Canadian Food Inspection Agency (CFIA) because a competitor complained when they found out that one of Falk’s regular customers was shipping what they bought to Alberta, he was shocked.
“We had no idea that’s what they had done and they had done it multiple times,” Falk told The Progress. “I said ‘Obviously we are not going to pay the fines, we didn’t do this.’ But they would back off, they wouldn’t back down. The CFIA reasoning was, if we had not produced the product and shipped it to our customer in B.C., the offence would not have happened.”
Like blaming an auto manufacturer for a hit-and-run, Falk couldn’t believe the CFIA’s logic or their tenacity in pursuing the file all the way to levelling seven fines of $6,000 each.
“It’s just stunning that that would be their reasoning for coming after me,” he said. “They didn’t charge the actual perpetrators. The ones that shipped it walked away scot-free.
“There is nothing I can do, but someone might be doing it so apparently it’s my fault.”
The CFIA told Falk they would reduce the fine by 50 per cent if he paid it in 15 days and admitted guilt. Instead, he chose to fight, entangling himself in a four-year legal battle that cost him more than $130,000.
Eventually, the Canada Agricultural Review Tribunal exonerated Falk agreeing that it is impossible for the company to track what others do with his product after it is purchased.
Falk is a member of the Canadian Federation of Independent Business (CFIB) which was “incredibly helpful” with his entanglements with the CFIA on this issue.
“‘That sounds like one of the worst of the worst abuses of government power,’ they said to me,” Falk said.
And CFIB stuck by that. This week is the federation’s red Red Tape Awareness Week, during which the CFIB holds an online vote to decide which of 14 examples of over-regulation is the worst of the worst.
There is the rule in Newfoundland and Labrador that forces convenience store owners that sells beer to accept an equal number of empties to bottles sold at the time of sale.
In Ontario, there is the rule forcing gas station owners to post a sticker outlining the federal carbon tax’s impact on gas prices on every pump. If a sticker is missing, fines of up to $10,000 per day can be issued.
And craft brewers in Alberta that outsource their brewing have to ship all product to one of two official warehouses in Edmonton. That means a brewer in southern Alberta has to pay for their product to take a 600-kilometre road trip even if the beer is to be sold next door.
The CFIB included all 14 of the 2020 Paperweight Award winners in an online readers’ poll to determine the winner of the Business Owners’ Choice Award. Voting goes until end of day today with a winner announced Friday.
For Falk’s Chilliwack poultry sales problem, the CFIB says the CFIA hasn’t implemented any changes to prevent it from happening again, but they should.
“The CFIA needs to use fairness and common sense enforcing rules and regulations and provide greater clarity around businesses’ obligations,” the CFIB lists as part of “the fix” to the over-regulation.
As for Falk, he said he fought the seemingly irrational CFIA fines to make a point.
“In many cases companies just pay the fine because there is no practical recourse,” he said, adding that the CFIA act as judge, jury and executioner with no oversight. “The reason that I did this was that justice does matter, doesn’t it? You expect me just to pay the fine and admit guilt for something that I didn’t do?”
Meanwhile, Falk has been battling with the CFIA over another issue, the sale of inferior, uninspected ducks from Hungary to stores across Canada. The CFIA allows ducks that he and others in the industry say do not measure up to the quality of Canadian ducks to be shipped across Canada, yet Falk gets fined because a customer brought some of his product into Alberta.
“The hypocrisy is astounding,” he said.
A CFIA spokesperson said that the decision to penalize Falk and his business was under the former federal Meat Inspection Act, which has been replaced by the Safe Food for Canadians Act and the Safe Food for Canadians Regulations (SFCR), meaning the situation won’t happen again.
“Under the SFCR, it is the responsibility of the person who is sending or conveying a food from one province to another to ensure the food was prepared by a licence holder. Consequently a person who is preparing food and selling it only within the province with no intent of inter-provincial trade, would not be subject to enforcement actions if their product ends up in another province without their knowledge.”
Falk called the response false, responding that he has asked the CFIA for years what he needs to do and received no response.
”This is a government bureaucracy drunk with power, because the ministers (health and agricultre) don’t bother to provide proper oversight,” he said. “CFIA will keep on getting away with this stuff until someone thoroughly exposes them.”
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