Doing business in Canada

Lars-Gerrit Lüßmann: Welcome to this event. Those of you who were born before 1980 might remember how such events were for German television. My name is Lars-Gerrit Lüßmann. I am a corporate partner in the Frankfurt office and co-lead of Gowling WLG Germany. I am delighted to welcome you to this afternoon's conference 'Doing Business in Canada' which we jointly host together with the BUJ (Bundesverband der Unternehmensjuristinnen) and I am particularly delighted to welcome Dr Patrick Otto and Dr Peter Anke as representatives of the BUJ in our office today, welcome.

Gowling WLG is a global 100 law firm with Canadian and UK roots, we have more than 1500 lawyers distributed equally on both sides of the pond and a year and a half ago we just opened the Frankfurt office where we today have together with our colleagues in Stuttgart almost 40 lawyers now.

The event today is a testament to our deep and widespread Canadian roots and I am very happy that the BUJ organised this together with us today so welcome everybody and I will pass you on to Dr Anke, welcome again and hopefully have a great session.

Dr Peter Anke: Thank you very much my dear colleagues a warm welcome to everybody and it is great to have you here. We are doing this in English today obviously because of the subject matter of course. We are very grateful to have the session here at the premises of Gowling WLG and thank you very much for inviting us and for having us that is a great opportunity.

We are very proud and very grateful to have you on board as our sponsoring partners since September 1st this year already, and we are looking forward in doing many interesting sessions together and to learn a lot from each other. So the credo of the bill is off to practice, for practice and this is what we are trying to do and we are very interested to learn about how things are in practice in doing business in Canada and so therefore I hand it over to you Mr Wittinghofer, thank you very much for having us and have a great time together.

Mathias Whittinghofer: Thank you Mr Anke, good afternoon also from me my name is Mathias Whittinghofer I am a Litigation Arbitration Partner in our Frankfurt office here in Germany.

I would like to take the pleasure of accompanying you through the first part of our programme today and it gives me great pleasure to handover the baton immediately to our Canadian partner Todd Burke from Ottawa. Todd of course is a partner in litigation and arbitration department where he handles complex international disputes, and he is also a member of our International Board the highest representative committee of our firm. Todd thank you for being here and over to you.

Todd Burke: Thank you very much Mathias it certainly is a pleasure for us to be here and to have this wonderful opportunity to speak to members of the BUJ.

I thought it might be interesting to start with a little bit of a humorous, serious introduction about Canada and what Canada actually is. People, places and phrases- I thought we would introduce Canada through that mechanism so as you know Canada is a very vast country. We have ten provinces and three territories, and our population is 41.2 million people but what you may not know is that we have the largest population of moose in the world.

Now our population is about one-half of Germany's population but we have 27 times the land area, and to give you a sense of the size of Canada my partner David Petras told me that if you flew from Victoria in British Columbia to St John's Newfoundland it would take about seven hours and if you fly from Toronto to Frankfurt it is about 7 hours and 45 minutes so it is a very very big, big country.

Now our national sport, our national obsession is hockey, alright so Germany has contributed to Canada's national sport because we are very lucky to have some very talented German hockey players. So I am from Ottawa, I am fan of the Ottawa Senators and we have Tim Stützle playing for us a star in Ottawa, and of course Leon Draisaitl in Edmonton and we have Mortiz Seider is playing for the Detroit Red Wings so you have got a great German contribution to our national sport.

If we could just move through. There is Mo Seider and we are going to go ahead. Alright, so we thought we would just tell you a few Canadian phrases. Now the most famous of Canadian phrases is probably 'hey' so you may say well what is 'hey' and it really if we can go to the next slide it means 'don't you think'. So aren't we going to have a great programme, hey, don't you think we are going to have a great programme, hey - so that is a Canadian phrase.

A Kanak means a Canadian. So we have got 15 Kanaks participating in today's presentation and then there is the word 'kerfuffle', now that is kind of a funny word. If we go to the next slide it means commotion so we are hoping that this programme does not create a kerfuffle today.

And of course, go to the next slide, everybody wants to show you a photograph from their phone and I thought I would give you three photographs from my phone just to show you the diversity and beauty of our country. So, the first one is in Halifax, Nova Scotia, and that is on the east coast, great maritime tradition. We will go to the next slide and that is the big city of Toronto, fourth largest city in North America, and as you can see the home of the Toronto Blue Jays and we go to our next slide and of course Canada is known for its rugged wilderness and outside activities and this is a picture that I took in Squamish British Columbia and that is just north of Vancouver.

We will go to our last slide, move on, a little bit about who we are and Lars says talk a little bit about who we are internationally but we in Canada have seven Canadian offices so in Vancouver, British Columbia, in Calgary Alberta, in Waterloo and Hamilton Ontario and Toronto and in Ottawa, and also in Montreal and we have in Canada over 700 lawyers just in Canada and of course providing legal services in a variety of sectors and a variety of interesting areas. So, a little bit about Canada, a little bit about who we are, I thought we would do that in a little humorous way so there is your foundation and we will move on Mathias.

Mathias: Before we do Todd one question, what is your favourite place, your most favourite place in Canada and why?

Todd: Well, my most favourite place in Canada is Newfoundland and Newfoundland is in the far east of Canada and I am a Newfoundlander. I was born in Newfoundland and if you go there you will be absolutely captivated by two things by the beauty along the coast, it is the sort of fjords of Norway but transported into North America so it is beautiful but its greatest asset is its people and I do not say that just because I am from Newfoundland but I say it because everybody there is so open and friendly, they are just beautiful people and if you have the opportunity to go, go to Newfoundland and Labrador.

Mathias: Thank you so much that is a good piece of advice.

Thank you, Todd.

We are now turning to our next presenter which is Jacques Shore. Jacques of course is a partner in our Ottawa office, and he is dialling in live from Ottawa right now. Jacques is a partner in our Advocacy Group and he specialises in federal regulatory matters and Jacques is going to talk to us about the Canadian political landscape against the backdrop of the recent US General Election. Certainly, an issue that is of interest to all of us, Jacques are you there and can you hear us?

I thought this was going to be a rhetorical question. Jacques this is Frankfurt calling.

Okay seeing as we seem to be having trouble reaching Jacques why don't we turn to André Bergeron, André are you there and would you be willing to talk to us about the economic landscape in Canada now, André if you are there I will say a few words about you?

André Bergeron: Hello yes I am here.

Mathias: Fantastic, thank you so much. André of course is a partner and economist hailing from our Ottawa office and he is a partner in our Tax Dispute Group. André over to you please?

André: Guten tag and thank you for the invitation to speak to you today. Today I will provide an economic and statistical overview of Canada and comparing it to Germany and exploring some economic interplay between these countries, so next slide please.

I think we will have to advance a couple over Jacques, another one and another one and another one, thank you.

So first Todd mentioned earlier in the presentation that Canada's population now sits at 41.2 million and interestingly 25 million Canadians reside in the provinces of Ontario and Quebec and two thirds of that population lives within a 100km strip along the border with the United States.

In comparison Germany's population is approximately 84 million meaning Canada has about half the population of Germany. We were also talking earlier about how big Canada is so geographically Germany is closest in size to the province of Manitoba and you could fit Germany twice in Manitoba. Overall though Germany's landmass is just 128th of Canada highlighting the vast differences in geographic scale.

So let us talk about unemployment. Canada's unemployment rate is steady at 6.5% which is up from the lows of 4.6% observed coming out of the pandemic in June and July of 2022. This marked the lowest level since 1976.

I also note that recently the employment rate is up 303,000 jobs year over year. So let us talk about the gross domestic product. So that is up 0.5% in the second quarter of 2024 recovering from recent lows of -0.1% in 2022. However, on a per capital basis GDP is still relatively low showing a decline of 0.1% indicating the economy is not keeping pace with our population growth.

Inflation has been a concern globally as you have seen in Europe and North America and Canada has not been spared. At one point in June 2022 inflation was up to 8.1%. However, inflation now sits at 1.6% year over year finally brought under control by the Bank of Canada's monetary policy, which aims to maintain inflation between 1% and 3%. So, speaking of the Bank of Canada, the bank's policy interest rate now sits at 3.75%. Down from its June 2024 high of 5% - signalling potential economic acceleration as these reduced rates filter through the economy.

Looking at the unemployment and GDP statistics one can conclude that the Bank of Canada's approach to slow the Canadian economic engine, by keeping interest rates high coming out of the pandemic, did reduce inflation and ultimately achieved its objective.

Regarding exchange rates the Euro is at 1.49 Canadian per Euro and the US Dollar at 1.39 Canadian per US Dollar. It will not come as a surprise to you that a low exchange rate with the US Dollar supports manufacturing in our highly intensive Québec Windsor Corridor where most of Canada's manufacturing and trade with the United States occurs. While this low exchange rate makes Canadian goods competitive in international markets, it does raise costs for imports to Canada.

And finally, it will not come as a surprise to you, but Canada's top trading partner is the United States. That is followed by China. Japan. Mexico and the United Kingdom. Both the United States and Mexico are key trading partners under the Canada, United States, Mexico Trade Agreement and of note Germany accounts for 0.95% of Canada's exports and 3.3% of its imports, highlighting a trading balance with higher value goods flowing from Germany to Canada. We will talk more about that on the next slide.

Next slide please. Thank you. So Canada and Germany enjoy a robust trade relationship underpinned by the Canada EU Comprehensive Economic and Trade Agreement, affectionately known as CETA, which reduces trade barriers and promotes investment between the two countries.

Germany is Canada's largest trading partner within the European Union. In 2023 Canada exported 7.1 billion in goods to Germany while imports totalled 25.1 billion. Major Canadian exports to Germany include energy products, metal ores and minerals which accounted for 35% followed by consumer goods at 11.8% and electronics at 11%. Canadian companies such as Bombardier Transportation, Magna International and Norbord, which was acquired by West Fraser Timber, operate in Germany.

Conversely Germany's exports to Canada consist of industrial machinery, motor vehicles and parts and consumer goods. This reflects a significant value difference with Germany exporting more manufactured and high value goods to Canada, when you compare it to the natural resources that are exported from Canada to Germany.

Several notable German companies operate in Canada. Some examples include Bosch, Siemens, Volkswagen, Mercedes Benz, SAP and Merck.

Thank you very much.

Mathias: Thank you very much André but before we let you go, one word on the trading deficit please. Canada has, as you pointed out, a large trading deficit with Germany. Has this always been the case?

André: Yes, so when I was looking at the 3:1 ratio that I was just speaking of and this has been consistent over time. The data on Statistics Canada's website shows us that this 3:1 ratio has been constant over time. What is surprising is how much the trade volume has grown so much over those 20 years. So, from an imports perspective it has increased from 2.7 billion up to 7.3 billion and then the exports from Canada have gone from 9.4 billion to 24.9 (exports to Canada I mean). So, it has stayed steady from a trade deficit perspective, but the volume has increased significantly over time.

Mathias: I see. Okay, well thank you very much for that analysis. With that thank you for your presentation and I think we can now go to Jacques who has now joined us. We can see you there in the conference room. Hi there. I hope it is now working technical wise and we would hear you now on your view of how the political landscape in Canada is affected by the most recent general elections in the US. Jacques over to you please.

Jacques Shore: Thank you. So Guten tag here in Ottawa, Canada's capital, I have been asked to provide a brief eight minute summary on our Canadian political landscape. As my practice is often focused on advising Canadian, American and European companies this often leads me to share my thoughts on the political dynamics in Canada. I believe we all agree that we are witnessing today, in North America, and globally something that is quite remarkable.

It is hard to know where to begin but I will briefly focus on the positive opportunities to consider, and we have the first slide there. Justin Trudeau's Federal Government, a left of centre Government, has been in office since 2015. The Government of Stephen Harper was defeated by Justin Trudeau in the sunny ways and sunny days theme. The Liberals came to power with much goodwill, great popularity and a majority Government. Since 2015 much has changed and we are now, we see the Liberals in a minority Government position. Much of its attention has been on climate change and social programmes. Whilst supported by the new democratic party a left-leaning socialist oriented party, it appears the next election will instal a Conservative Government. A right of centre party with populus views io true power with its leader Pierre Poilievre. Pierre Poilievre a career politician elected some 20 years ago and at the age of 25. But when we look ahead it appears that the look of the October 2025 election coming up is one that will probably ensure that the Trudeau Government falls. Nevertheless, we are seeing four opposing parties that might actually bring the Liberals down even earlier but they are hesitant to do so and frankly Prime Minister Trudeau has no intention to step down and certainly not before his preparation for the G7 which he will be hosting in June.

Canada has experienced impressive growth over the past two decades but significant challenges lie ahead. Worthy to note that from 1995 to 2016 Canada attained the highest rate of GDP growth of any G7 country. That is 2.4%. If this would have continued it would mean growth at this rate doubling every 30 years and it has not happened for several reasons. There have been challenges to the very high quality of life the Canadians have enjoyed and in a recent study by Boston consulting, we see that Canada's strong economic performance has allowed the country to put off the need to address growth and productivity inhibitors that other countries that have to address directly. It is suggested that unfinished reforms would be required to boost productivity and deliver on big ideas and innovative solutions to drive growth which must be pursued.

The key threats when we look at, are being addressed and it is proposed that creating growth through opportunities such as shaping Canadian cities into the economic drivers through investment, in technology and urban development is key as well. Transforming Canada's advantage of richness in vast natural resources, precious metals, significant oil and gas reserves, nuclear knowhow and hydropower are all components of our rich energy sector. I may add the envy of the world in many respects. Furthermore we realise it is critical to bring together marginalised communities such as indigenous people and new immigrants into the economic mainstream and then to maximise global flows of investment. To date, Canada has attracted good talent through openness to trade and immigration. We see great opportunities for Canada to lead in the fields of digital and AI technologies. These are not pie in the sky ideas. The intellectual human resources required to advance our economy do exist in Canada and would be enhanced with the additional benefit of focus and strategic financial investments.

We witnessed an example of recent investments in Ontario regarding EV and the efforts to expand on hydrogen energy initiatives following last year's visit of transfer shores to Canada. Overall Canada seeks to further grow and strengthen its relationship with European countries. We can also point to the recent roadmap between Canada and Italy. Canada seeks to work with like-minded nations with the same shared values.

While I would like to share some thoughts on recent provincial actions I do not have a lot of time to do so but I will say that we are seeing some changes towards more populous Governments in our provincial elections recently.

In DC for example we saw an almost even split between the governing new democratic party and the conservative party. Clearly consensus Government will be required there in Saskatchewan Premiere Mo, just brought in his right leaning Saskatchewan party with a majority with a majority and in New Brunswick the liberals defeated the conservatives and a woman Susan Holt is now premier with a majority.

We are expecting provisional elections in Quebec and Ontario in 2026 the provinces of Ontario Quebec are key engines of Canada's economy and will be important players in working with the Federal Government to engage in the new Trump administration. As well the province of Alberta will play a critically important role with respect to the energy sector particularly with respect to oil and gas and the promotion of new methods to transport fuel to far away destinations.

Next slide please, Bitte. This leads me to the Canada US relationship and President Trump's return to the Whitehouse in January. Suffice to say that people are worried, but many are cautiously optimistic that this new chapter on the Canada US relationship will be positive and productive. During the last round of Trump's four years, it did not appear that the relationship was an endearing one between Trump and Trudeau and we saw pressure in the context of the America First Agenda. As a result, the Government of Canada has over these last few months worked diligently to address any eventuality regarding US election. A team comprised of key ministers; bureaucrats has been created to ensure a smoother relationship. Worthy to note is the same in Canada when the US sneezes Canada catches a cold. Well, this is generally true with respect economic issues the United States but at this time it is my optimistic view that Canada will avoid catching economic pneumonia.

I believe that we can and will succeed. All this is obviously important as we know that Donald Trump speaks of changing or ending the current free trade agreement between Canada and the US. The next round of CUSMA Review will be in 2026 and my sense is that it is in America's interest for Canada's economy to be robust.

Our senior politicians have given assurances to Canadians that we expect our strong and economically positive relationship with the US to continue. Naturally, the Government would be put on a positive….well it has to be put on a positive sentiment for the public but I have no reason to believe that we will not succeed as appropriate steps are taken to understand the Trump administrations key objectives and work along with them. This morning in fact Trump had identified Ambassador Peter Hoekstra former congressman for Michigan who served as Trump's first administration as the Ambassador to the Netherlands. So, discussions are on your way to embrace the opportunities that lie ahead by focusing on the continental economy in several sectors and the role of Canada must play by maximising on its natural resources and human capital.

We will be obliged to take steps in increase expenditures in fields we avoided such as increasing our military spending, securing the north and moving away from some outdated public policies such as the protection of supply management in the field of dairy products which has been criticised severely by Americans.

We will also need to revisit the extent of unnecessary regulatory burden which exists at both Federal and provincial levels. A former US Ambassador to Canada confided to me last week that while many may say the sky is falling down the reverse is much more plausible and likely and that there are many reasons why Canada and the United States must continue to work hand-in-hand and make things together on both sides of the border as we have done so well through previous decades.

We have a border that must be secure but open to the legitimate movement of people, goods and services. Canada is ripe for new investments and is a country that should be regarded by Germany as a serious business partner for commercial engagement into North America. It is a logical stepping stone into the United States especially as we witness a level of uncertainty in the United States. Truly, I believe it is a perfect time to strengthen our bridge across the Atlantic between Germany and Canada. Danke Schön, last point, Canada will remain safe and stable place to invest and while we may undergo a change of Government at the Federal level much of our day-to-day domestic lives are also running covered by in Canada at the provincial level all positive to consider through the turbulent times we may see over the next four years in the US and Mexico as well so yes [unknown – German]], Danke Schön.

Mathias: Dear Jacques thank you very much in particular for putting Canada forward as a destination for foreign direct investment from Germany and you couldn't have put it any better providing me with a better opportunity to lead onto the next part of our programme - we are now going to take a critical look at the those sectors most relevant to Canada and the Canada/German relationship and we have put together a panel of five lawyers from our offices in Toronto, Vancouver, Ottawa and Waterloo and they are:

Paul Harricks, who is a Corporate Counsel specialising on energy, nuclear and infrastructure;

Sonia Ziesche. Sonia is a partner leader of our Vancouver Life Science Group with a focus on intellectual property and what is most notable about Sonia is that she has a diploma from the Technical University of Darmstadt and is fluent in German but I assume as only you will none-the-less give your presentation in English;

we have William Bjornsson. William is paling out of Ottawa where he specialises on all matters related to food, drug and consumer products regulations;

we have Viona Duncan from Waterloo. Viona is a Corporate M&A Partner and former leader of our Technology Industry Group; and

last but not least from Toronto Daniel Cole. Daniel is a specialist in Advertising and Intellectual Property Law.

With that I invite the five of you to give us an overview of your relevant industry sectors in Canada.

Paul Harricks: Well thank you very much I think I drew the shortest straw so I get to start. I just want to thank everybody for joining us today and tell you want a great pleasure it is for us to present to you on all things Canadian.

I am going to talk about energy and when I am talking about energy in Canada I am going to talk mostly about the electricity sector that is not to say that the fossil fuel world is not as important to Canada as Jacques has already indicated. The fossil fuel sector is absolutely vital to our economic well-being of Canada after all has the third largest oil reserves in the world next to Venus Walia and Saudi Arabia and although some people might not like to hear about it the oil and gas industry is going to be a very crucial part of our economy I think for many, many years to come but I am going to talk to you about electricity and there are a few important points to remember if you are thinking of approaching the Canadian electricity sector and participating in it. First Jacques indicated that a lot of the Canadian economy and the Canadian governance is at the provincial level and electricity is a perfect example of that. Electricity with a few minor exceptions is not the responsibility of the Federal Government rather each province and territory in the country has its own unique market for electricity including its own regulatory regime. Secondly, a feature of the market, the future of the Canadian landscape, is that the provincial Government itself is the owner and operator of not just the transmission system in most provinces but also the generating asset so in British Columbia for example BC Hydro which is owned by the province is really the only participant in the British Columbia electricity market.

By contrast next door in Alberta there is a lot more private sector participation which I think is a reflection of the political ethos of those two jurisdictions whereas here in Ontario we have what we call a hybrid market with a very large generation company owned by the province of Ontario but also a great many private sector participants in the generation market that power producers. The other feature is that to the extent that power is transmitted across borders and Canada for the most part it goes north to south goes into and out of the United States rather than east west there has been talk for many years about building an east-west power grid in Canada to link the country in much the same way as our railroads linked us historically, but that has not really come to fruition and there is all sorts of geographic and frankly political barriers to that.

I would also want to mention that the different parts of the country are at very different stages in the so-called energy transition. British Columbia for example is like Quebec almost entirely hydroelectric for waterpower. Right next door though to British Columbia in Alberta they are still very much a fossil fuel jurisdiction and that is hardly surprising since that is where the Canadian fossil fuel production is primarily located.

Further east here in Ontario, where I am, is our largest province we have taken ourselves off coal since 2014 - it comprised about 25% of our generation and we are now largely emissions frees in our electricity generation in the province but that's down mostly to the fact that we have 60% of our power produced through nuclear (which I will come back to in a couple of minutes). But obviously renewable power in particular wind and solar coupled now with battery storage is going to be the major growth area in the coming decades.

Here in Ontario, we recently announced that the province is going to be procuring 5,000 megawatts of power and are mostly renewables in the next two or three years. In Quebec they are looking at procuring up to 10,000 megawatts of power over the coming decade or so and so that is where the growth area is.

Alberta too is on a path to weaning itself off its fossil fuel reliance and building a lot more renewables and German companies I should have been part of the Canadian growth and renewables for many many years. RW he is active here enable significant participants in the Canadian landscape.

So just a couple of words about nuclear which is a subject near and dear to my heart. I know we all know that Germany has turned off its last nuclear reactor, but Canada is very much in a growth phase when it comes to nuclear. Just last week AtkinsRéalis, the major Canadian engineering company, announced that it has signed a contract to build two new so-called Candu reactors, proprietary Candu reactors in Romania and in Canada at large they are talking about both largescale and small scale small modular reactor development and the first commercialised small modular reactor or SMR development is in the world is outside of Russia and China, is taking place right here in the province of Ontario and I think that everybody recognises that technology is very much going to be on the forefront of the energy transition but before I leave nuclear and turn it over to Sonia, I want to just point out that Canada is one of the largest producers of medical isotopes in the world and that is really down to our reliance on nuclear power so with that maybe slightly awkward segway Sonia I will turn it over to you.

Sonia Ziesche: Danke Paul, thank you Paul, yeah I will give you an overview of the life science sector in Canada. So you might associate Canada with mining or energy as just discussed by Paul but Canada has actually quite a vibrant life science sector and a long and noteworthy history of life science contribution for example, Insulin was discovered in 1921 at the University of Toronto by Frederick Banting and Charles Best and a bit more recent and quite fresh in our minds and also our bodies the lipid nano particles that are used to deliver the Pfizer-BioNTech and the Moderna MRNA vaccines were actually developed by Aquestive Therapeutics which is a spin-off company from the University of British Columbia here in Vancouver.

So, Canada's life science industry is a significant contribution to the country's innovation economy and encompass as a wide range of activities from research and development to manufacturing. So, the industry places small and medium sized companies developing diagnostic biopharmaceuticals, pharmaceuticals and medical devices but they also have global companies with research development and manufacturing operations.

Contract service providers support the industry, and they also have quite a large clinical trial sector and manufacturing basis. The industry is mostly classed that in the metropolitan areas of Toronto and Montreal and Vancouver where there also research incentive universities which reside in spin-off companies from these universities.

Life science is a broad sector but the key sectors in Canada are biopharmaceuticals and pharmaceuticals. The pharmaceutical and medical manufacturing industry contributes about 82.5 billion to Canada's gross domestic production in 2023. Then we have the medical device sector, Canada has over 2,000 companies in this sector which focus mostly on medical imaging, cardiovascular devices and robotic surgeries and then our biotechnology sector has been substantially growing since 2019 with investments totalling 25.9 billion into more than 175 companies.

Digital health is also quite big with investments in telemedicine, health informatics and variable technologies. Canada is also number one among the G7 countries and the number of clinical trials for population. Obviously, there is much more to talk about the sector and I could go on quite a bit but in the interest of time I will hand it over to Bill now who will give you an overview of the food and beverage sector.

William Bjornsson: Thanks Sonia. So yeah I will talk to you a little bit about the food and beverage sector in Canada, focusing mostly on sort of food and beverage manufacturing which is one of the largest manufacturing industries in Canada in terms of value of production so our sales of goods in 2022 were goods manufactured were worth $156 billion which accounted for 18.2% of total manufacturing sales and 1.7% of national growth domestic product.

Food and beverage manufacturing has both provincial and of federal… is subject to provincial and federal oversight. Once food has crossed the provincial and national border this is where federal regulations sort of kicks in and so the food and beverage industry provide employment for over 300,000 Canadians which means you know Canada has a large knowledgebase and labour force for entrance into the market.

Within the industry, food product manufacturing is the largest sort of sector which accounts for about 25% of the food and beverage manufacturing in Canada but we have a diversified market, you know, which ranges from alcohol products, breads, sugars and confectionary and obviously a large agricultural sector. Most of the food manufacturing takes place in Ontario and Quebec which is where most of the sales takes place just simply due to population demographics.

Canada exports food products to almost 200 countries globally but and 77% of those exports are directly into the US market, so quite a strong pipeline into the US market out of Canada.

As a sector you know it is a diverse with traditional food and beverage companies - a lot of food innovation. We see, you know, examples of German companies operating very successfully in Canada. Dr Oetker for example has manufacturing here. I was on a food trade delegation to northern Germany last year and happened to visit a factory that was just around the corner from Dr Oetker factory so it is a well-known brand in Canada, or in Germany, but also in Canada and so one of the recognisable brands operating here and there is certainly room for more in Canada. With that I will pass along to Viona Duncan to speak about technology.

Viona Duncan: Thanks Bill. I think I have an interesting factor because as you have been hearing from my colleagues, technology permeates every sector and obviously is a key part of the Canadian economy.

In terms of quantifying, it is quite difficult to quantify it from a GDP perspective just because it hits every sector and there are users of technology and creators of technology. Canada has been described often as the silicon valley of the north and that is really due to its number of innovative startups and also global multinational tech companies with significant operations in Canada and I know we have heard earlier in the presentation companies SAP, Siemens etc. have all been in Canada for quite some time and continue to access the highly technical talent that Canada has and a very strong R&D culture.

Another thing that makes Canada extremely attractive from a tech perspective is that the Canadian Government has provided significant financial support through tax and other incentives to make it attractive for foreign tech investment.

Specifically, I was asked to speak a little bit about some of those programmes or some of the things the Canadian Government has done to support tech and innovation. For example, Canada previously created and funded what is called Global Iinnovation Supercluster Initiative and that has resulted in growing tech innovation hubs and centres of excellence in major cities across Canada. For example, I know Jacques talked a little bit about Government but because that is the seller where the Canadian Government is a lot of cyber companies and defence companies migrated to Ottawa to create new technologies and that relate to Government.

As well Toronto has been a significant tech focus including startup investment and that is due to the VC cluster and also has really been focused on as well the expanding film tech market with all the major banks there and that is just to name a few. I wanted also to talk about what Canada has done they have modernised, and I guess further capitalised, scientific research and experimental development and those are called SR&ED credits or tax incentives and that is to encourage businesses to conduct research and development for eligible activities and that has been a big driver of the innovation in the technology market.

The Government has recently announced the expansion of eligibility for clean tech manufacturing tax credit, and I think Dan after me will be talking a little bit more about that. Canada has also just announced an investment and partnership with a European company to advance 5G technology and RMD in wireless technologies in Canada and as well they continue to support AI which of course is a major area right now and there is a $2.4 billion investment in AI and this investment includes building and applying new AI solutions, research and development supporting new innovative technologies and really accelerating AI adoption in critical sectors that touch on tax such as Cleantech Healthcare and Manufacturing. But with that, we are seeing a lot of investment by European and German companies into Canada to take advantage of the innovation that is supported by Government here and we think that will continue to do so as others have said, Canada is rich for opportunity and continues to grow and expand in the tech area.

I am going to turn it over to Dan now to talk a little bit about manufacturing and also how tech and manufacturing relate to one another.

Daniel Cole: So just to give you a brief overview, manufacturing is very much a cornerstone in the Canadian economy. A couple of stats 10% about 174 billion of the gross domestic product accounting for about 1.7 million fulltime jobs. Canadian manufacturers export about 350 billion of goods, that is 68% of our merchandise exports. I think it is fair to say there is always challenges right in every sector; trade disruption, global uncertainty involving regulatory landscape and things you have heard about, but we are very much seeing these challenges presented as positive opportunities for the Canadian market.

So in the guise of keeping it short I will talk very briefly about an area that is very near and dear to my heart which is the automotive sector. This is where I spend the vast majority of my time and we get a good fortunate working with many different automotive manufacturers. With Porsche, Audi Volkswagen, Mercedes-Benz, BMW and so if you were following the news today, you will actually see mentioned that one of the big domestic three auto manufacturers announced a bunch of overseas job cuts. They ultimately are tying that to costs, right, but the one thing they did note was the need for more Government incentives to offset the cost of manufacturing in purchasing electric vehicles.

In effect, what they are saying right, is it too expensive and they cannot compete with the China market and so they are pleading with Governments to make it easier for them to manufacture and easier for consumers to ultimately purchase. So, we think this is one of the areas where Canada has very much excelled, and we have heard a couple of examples of this. There are significant consumer incentives to purchase EV's in Canada but the Government also offers a number of key incentives to attract manufacturing to Canada. So, to give you a couple of quick examples of that, there is a net zero initiative which is where the Canadian Government announced it is going to phase out completely new gas-powered vehicle sales by 2035. That would be resulting in a net zero emission transportation sector and then as Viona mentioned the clean energy tax credits. This is the Canadian Government offering clean energy incentives that provides 30% refundable tax credits in the case I am talking about, in the production of zero emissions electric vehicles.

So what are we seeing is that these and other incentives are providing significant opportunity for manufacturers to invest in Canada and in fact since 2020 Canada and Ontario, which is where I call home, has attracted over $17 billion in investment by global automakers and suppliers of battery material.

So I will leave you with these two examples. Jacques mentioned one, but just a bit more details Volkswagen, through its subsidiary PowerCo is about to establish an EV battery manufacturing facility right her in Ontario. It is anticipated that that plant will produce enough batteries for 1 million EV'sa year and will be the largest manufacturing plant in Canada.

And then recently a Japanese auto manufacturer announced that it will actually be building 4 factories in Ontario as part of a $15 billion investment in its North American EV manufacturing footprint.

So it is fair to say that one thing to us is very clear, Canada and Ontario have become really top destinations for manufacturing investment and I will leave it at that.

Mathias: Thank you very much Daniel. This concludes and thank you all the panellists giving us and overview of the different sectors, this concludes the first part of our programme. Why Canada? It was entitled.

Lars-Gerrit: Welcome back after a short break. After the, I found very interesting, introductory session on Canada on its political and economic background and environment. I have now the pleasure to welcome you to part 2 of our session ' Coming to Canada'. It will be about how does the work come into Canada and what are the issues?

We will kick that off with my partner Chris Andree. He is from our Waterloo Office. He is a Labour and Employment Partner who supports many international businesses operating in Canada with their people issues. So, Chris.

Chrisopher Andree: Thank you very much. Thank you. Welcome to everyone. I appreciate you spending some time with us. Most of the businesses that are involved in international trade are going to involve having people on the ground. People in Canada. And so the purpose of this presentation is to give you just a very basic sense of things.

The good news, I think for most employers, is there are no works councils. So, I believe that that would be good news for most but one of the challenges is that the relationship is a contract. If you are familiar with the US structure and think that all North America is similar, we could not be more different from the US in terms of many of our employment and labour rules. So, the relationship is a contract which means neither party can unilaterally change the terms of that contract.

Jaques and others talked about the different jurisdictions. Because we have 10 provinces and 3 territories and 90% of the employment is governed by provincial legislation as an operator in Canada you can be subject to many different regimes depending upon where you have people. If you have got a salesforce in different parts of the country you can have different individuals. If you have a manufacturing facility in one province and then in another, the rules will not necessarily be the same. They are likely to be similar, but they are not necessarily the same.

A written agreement between the employer and the employee is not required, it is highly recommended because some of our common-law traditions have resulted in quite generous employee friendly outcomes in the Court. Many of those rules you can agree to a different outcome by contract and so we tend to support businesses in the development of their written employment agreements as part of their systems when they are entering the country.

There is legislation to promote the various social policy goals of the provincial Governments. So, we have a minimum wage. You can see the number in Ontario. Social benefit costs are approximately 20%. So, a little less than some European jurisdictions. There are maximum hours of work restrictions. Our vacation entitlements are dramatically less than some of your jurisdictions. Two weeks to start. Three weeks after five years and then of course we have very robust legislation anti-discrimination legislation.

In order to implement some of those social policies goals, Governments can be very strict when it comes to certain things like workplace safety. So, if there is a charge of violation of the workplace safety legislation the fines can be quite significant. Up to $2 million Canadian for a violation.

We do not have a national privacy rule, the way that you have GDPR or in some other jurisdictions so it is a patchwork of legislation and therefore can be difficult to comply when you have operations in different provinces.

Disputes that arise between employers and employees generally speaking if the employee is not unionised that matter typically would go to the Court. If the employee is unionised then that matter would typically go before a private arbitrator or, depending on the nature of the dispute, it could be a labour board.

Next slide please.

For those of you who are involved in manufacturing, involved in brining your technology to Canada, there are quite robust intellectual property rights. Generally, they are in favour of the employer but you would want to have agreements to ensure that you protect what is important to you.

There are also quite robust confidentiality rights for employers and there is fairly limited whistleblowing protections for employees and so it is in many ways a good location when you are involving trade secrets, intellectual property is a big part of your business.

When it comes to terminations it is simpler than many European jurisdictions, certainly in Germany as I understand it, but it is typically more expensive. So if you do not have cause to terminate the employee, they have misconducted themselves in some way, the awards under legislation can be quite high but even under the common law they can be up to 24 months of pay to a long service older employee who is going to have difficulty finding replacement employment and so it is important to have those written agreements to try and limit that liability to the degree that you can.

A couple of other things that you should know about the market. Like in many other jurisdictions non-competition obligations are not enforceable typically and in fact, at lease in Ontario, they are illegal for most employees. Reasonable non-solicitation provisions can be enforced. The scope of those, the breadth of those, is where you can determine whether it is enforceable or not.

Just very quickly some statistics on unionisation. 19% is in the private sector. It is over 80% in the public sector. There can be multiple bargaining units in each physical location so unlike a works council, where you have one for the entire operation, you can have multiple bargaining units. There is a trend right now in service sectors for more unionisation. I have listed some of the names there.

The last point I will make is independent contractors, in contrast to employees, they are permitted but we face some challenges if there is a misclassification. If you assess them to be an independent contractor and it turns out they are an employee, as the law would determine it, the consequence can be quite significant. The costs can be significant and those are off balance sheet liabilities. You won't know they are there until the decision is made and the Court is enforcing the obligations and so it is something that needs to be carefully considered and obviously a written agreement as part of that process.

So, I will stop there. I will turn it over to my colleague and my partner David.

Lars-Gerrit: Before we move over to David, allow me one question Chris. So, I am just a corporate lawyer so you have told us a lot of interesting stuff about employment law and I learned that this in Canada is as important as in Germany and sometimes even more important than corporate maybe, but just to summarise, what do your clients find to be the most challenging about managing people in Canada?

Christopher: For foreign businesses, the assumption that Canada is one big jurisdiction. In fact, it is 13 separate jurisdictions and so when employers come, they come with a view of how they want to do business. They can do business that way typically, but the challenge always is to ensure that you know where those employees are, and you are complying with the legislation in the province in which those employees are working.

In 2024 with more remote employees, it is that much more challenging because they may work in one province and live in another. So, it can be a bit of a challenge but that is one of the most difficult.

Lars-Gerrit: Thank you very much. Thank you, Chris.

Christopher: Thank you.

Lars-Gerrit: And now I have the pleasure of introducing my partner David Petras to you and you will be more pleased that I can do this live and in colour as we said in German television in the 1970's. David is a corporate M&A Partner and the Canadian leader of our European initiative and David regularly advises on FDI into Canada. Welcome David. He will talk to you about corporate structures.

David Petras: Thank you Lars. I am really sorry to not be speaking to you in German today. I have been trying to learn a little bit. I have been using the Duolingo app and so far, I have learned sentences but I do not think that will help today, so I am going to continue in English.

In Canada we have a number of different corporate structures. You will see on the slide that we have limited partnerships. They are typically used for real estate and investment funds. We have unlimited liability corporations so not limited liability, unlimited liability. They are typically used for some Canada/US tax structures. So, it is the one in the middle. Ordinarily business corporations that we use the most often.

There is no real equivalent in Canada to a US LLC, so we use these regular business corporations. They are like a US C Corp, and they are for limited liability and the actors within those corporations are shareholders, directors and officers. We can incorporate in anyone of the 13 provincial and territorial jurisdictions or there is also a federal business statute. You might think the federal one would be a way to go, but there is no particular advantage to that, so usually we find that German companies coming to Canada will incorporate in the province where they intend to locate their main office.

I should say it is very easy to incorporate. Not a lot of information is required. It can be done quickly. If a corporation is incorporated in Ontario let us say, but does business also in Alberta, then an extra provincial registration is required in Alberta, that is a straight forward filing but it also requires the appointment of an Agent for service in Alberta and sometimes a company will have a representative who could do that or sometimes it is a Lawyer who will do that and then there is an annual filing that goes with it. So we have some German companies that have incorporated and they operate only in Ontario. They do not need to worry about extra-provincial registrations. Others that operate the country and so they need to do that.

Share capital. Almost every company will have common shares, so they are voting usually. They have a right to whatever dividends the directors declare and the right to receive the residual assets. But then we can have preferred shares, and they are limited only by our imaginations. They could be voting. Have dividends. Be redeemable. Retractable and so on.

Shareholder agreement would be required if there is more than one shareholder. So perhaps a joint venture or similar arrangement where there is more than one shareholder and there we would need to address how governance is going to work. Who is going to be on the board. What happens in various capital transactions. If there is an offer for the company or right of first refusal, that sort of thing.

Historically in Canada it was impossible to know who the shareholders of a corporation were by doing a public search but that is changing and in many of our jurisdictions now there is a requirement to advise the Government of shareholders in excess of 25% and in some jurisdictions that is just disclosed to the Government and in other jurisdictions that is now publicly searchable and it is a trend we will find that it will be possible to know shareholders in all jurisdictions soon enough.

Directors are elected by the shareholders. Only the federal and corporation requires that any of those directors be resident Canadians otherwise they can be from anywhere and directors are subject to two principal duties. A fiduciary duty, so a right and an obligation to act in the best interests of the corporation and a duty of care to exercise the care that a reasonably prudent person would exercise in the same circumstances.

Next slide please.

Directors – sorry back one please. Yes thank you. There are also specific statutes under which directors and officers have liability, environmental health and safety, environmental statutes and to deal with these liabilities directors and officers will often want to see that director and officer liability insurance has been purchased.

Officers are appointment by the directors. We usually have at least a President and a Secretary, but you can have as many officers as you like and they have the same duties as the directors do.

If a new company is being established in Canada, or a company is being acquired in Canada, we need to think about the Investment Canada Act and if the value involved is above of a very high threshold, then the Government needs to review the transaction. If it is below the thresholds then it is a simple filing to be done 30 days after creating the company or making the acquisition.

There is an exception though, if it is considered to be a Canadian cultural business, the threshold is only $5 million and so in that case review would be required and there is more and more interest in national security everywhere. In every country including in Canada and so there is a broad power that the Government has to review transactions, acquisitions. They are particularly interested of course in the country of origin, of the acquirer and whether there is sovereign wealth fund involved and also whether it is sensitive technology, infrastructure, defence, cyber security and so on.

Finally, we have pre-merger notification if an acquisition is being made over the thresholds that you see on the screen and both of those thresholds have to be exceeded before a review is required and then the Government could take 30 days or more if it is straight forward. If it is complex, a lot more, to approve or not.

So just to conclude, it is relatively easy to get established in Canada through a new incorporation or by acquisition but as you have seen there are a few tricky areas to think about.

Back to you Lars.

Lars-Gerrit: Thank you David and being a corporate lawyer myself I could have listened to this for hours.

David: Oh yes. Everybody says that.

Lars-Gerrit: But putting myself in the client's shoe my key question would probably be, how quickly can you incorporate a Corporation Canada?

David: It can be done very quickly. As soon as we have all the information we need, we can do it electronically in about one hour without any signatures. It is very fast.

Lars-Gerrit: That is fascinating and much quicker than in Germany. Thank you, David. I have now the pleasure to introduce and hand the baton over to Carl Hinzmann. Carl Hinzmann is a Partner in our Toronto office. Carl is an income tax and structuring Partner focusing on M&A, inbound investment and reorganisations. Carl is a German ex-patriate and fluent in German and he will talk to you about tax issues. Carl over to you.

Carl Hinzmann: As David mentioned, for most German and European business who are going to engage in an active operation in Canada, usually the way to go is a Canadian corporate subsidiary. So, I am going to focus on Canadian corporate subsidiaries, particularly those that are subsidiaries of a German parent and how they are taxed and how you get your money in and out of that subsidiary.

So we just learned they are very quick to incorporate that subsidiary. The first two things you are going to want to think about in putting that together is who is your shareholder going to be and how do I maintain the tax residence as Canadian for that subsidiary? So in terms of the shareholder, generally the Canadian German tax treaty is quite favourable so usually you will want to have the Canadian subsidiary be a direct subsidiary of the German parent. One of the issues we very commonly come across with a lot of European head offices is that Canada is often a secondary territory from an operational perspective to the US and then often they have expanded the US and it is the US that drives potentially the Canadian expansion and the Canadian subsidiaries is set up under the US company but because the Canada/US treaty has some limitations on the ability to get into that treaty, where the US company is not ultimately US owned, it is actually a very bad structure. So, when you are coming into Canada as a European organisation usually you want that ultimate owner parent to be the direct shareholder of your Canadian subsidiary.

A second part is tax residence. So like Germany, in Canadian law you can have a corporation and be resident in Canada, therefore tax laws here (either by virtue of its place in corporation or by virtue of its management) control for which we usually look at the board of directors.

One of the issues that potentially arises, particularly with paying subsidiaries of European parents is that a European countries have a minor management rule and so if you were to stack your board of directors of your Canadian subsidiary with German directors, that may cause it to be resident in Germany or wherever else your majority of directors are, by virtue of that and now you've got a dual resident company and there is no need to tiebreaker the Canadian tax treaties of most of the German jurisdiction. So that can actually cause trouble so ideally you want to have a majority Canadian board of directors notwithstanding our corporate law does it require it. If you cannot for some reason do that, which is sometimes the case, you still have senior enough people in Canada there is ways to structure it otherwise of just ensuring your meetings are there. Just making sure that your minor management does not end up in a different country other than Canada.

In terms of tax rates, I think that Canada is pretty competitive. The combined federal provincial rate is 23% to 27% in our most populus provinces. I think it compares relatively favourably to German tax rates. So for comparison sake, for those who do not practice German tax, I think like in Frankfurt the effect of corporate tax raises to 32%. So, we are actually quite a bit lower than that.

So, the next part is, you are setting up, you have got your shareholder, you have figured out what your tax is going to be. How are you going to get money into your Canadian sub to get it to operate? So two principle ways. One is equity. We do not have any minimums or maximums like various other jurisdictions do. Then the other side of it is funding it by a debt. So, making a loan from parent to the subsidiary.

There are a couple of limitations. One is an older limitation, and the limitations are really around interest deductibility. So, one is what we call the thin cap rules. Basically, interest is deductible only to the extent your debt is no greater than 1.5 times your equity and equity can float around a little bit because it can include things like retained earnings. So, you have got to be quite careful with it and then we have got a new set of rules that came out about a year ago called the Eiffel rules and while I understand that the French have a very similar set of rules I am not sure it was intentional that Eiffel is that is actually excessive interest for financing limitation rules. But basically, that limits your deductibility of various financing expenses including interest to about 30% of the tax EBITA which is a somewhat convoluted varied version of what you would look at as accounting EBITA because it starts with taxable income and then has some computations around it.

Next slide please.

So, now hopefully you have got your Canadian subsidiaries making some money for you. So how do you get your money back out? Three ways. So obviously you can get capital back out, share capital or contributed capital. Or you can repay the loan in principal as no withholding tax on that. Unlike some other jurisdictions Canada does not have any rules about paying out profit via dividends before returning equity, so it is quite favourable in that sense. Interest payments within a related party group - the base withholding tax rate is 25% but under the Canada/Germany treaty it is reduced to 10% and with respect to dividends similar base rate of 25% withholding but usually reduced under the treaty 5% or 15% and the 5% rate to access that, the beneficial owner of the dividends, have got to be a company and it has got to hold at least 10% of the shares. So, for wholly owned subsidiaries you are looking at 5% holding rate on dividends.

So, to touch on a couple of other tax points. So, if you don't set up a Canadian subsidiary and maybe you are just doing a little bit of business in Canada. A very common situation from German perspective is manufacturers that are setting up equipment. Perhaps they have got some employees here for a slightly longer period of time while they are installing machinery, something like that. We have a withholding tax rule, what we call 'Red 105 withholding', but basically services rendered by a non-resident. So that would be a German company or any other non-Canadian company. When it is rendering services in Canada the payor of the fees for those services required to withold remit 15%. There are some ways to get around that for applying for a waiver in advance. Somewhat convoluted subject to certain limitations, but something to be aware of particularly for German companies that are sending people over for those sorts of slightly longer periods of time. So not a conference but actually to work here for some period of months or even a little longer.

Then sort of I guess the contrasting thing to a subsidiary is what if you just set up a branch operation, so your German company opens an office in Canada. So, what happens? So, once you have a permanent established and fixed place of business like an office, that becomes a branch operation and it becomes subject to Canadian tax and basically Canada tax is then the income derived from that branch. We do not see a lot of branches anymore unless there is a regulatory reason for it and the principal reason why is, it is very difficult to do the tax reporting for a branch operation. Trying to actually allocate what income and what expenses are the branch and what is the main head office.

Then there is the last point I guess and to carry on with the theme of sometimes, or maybe this is just a little inferiority complex for the Canadians, but we always contrast ourselves to the Americans so unlike the Americans and unlike much of the European Union, we have a value added tax. Federally it is the GST 5% across the board in every province. We also have HST which many provinces have adopted and in Quebec it is QST. We have a couple of provinces, sorry, with a sales tax that is BC, Manitoba and Saskatchewan. Overall the combined sort of federal provincial rate ranges from 5% to 15% so lower than most European jurisdictions. But another one of those things you have really got to think about as soon as you are starting to engage in sales or delivering goods into Canada is, do I need to be registered? Do I need to be collecting these taxes? And there are often also one the drivers why companies come into Canada or selling into Canada. Everybody wants to start and sell to everybody but it is often much simpler between, you know Chris talked about the employment rules are different from province to province and another one is really the sales tax and VAT regime because it varies from province to province and so picking a couple of the more populus provinces is sometimes a way to get a feel for the regulatory regime rather than trying to register for every sales tax in every province right after that.

I think that is it for my part.

Lars-Gerrit: Thank you Carl. I think that was very comprehensive and very interesting. I must admit the 70's TV show is very similar to those old shows. I was therefore a bit distracted when you talked about repatriation of profits. You said, you can do this by using dividends and interest. Are there any other means to repatriate profits?

Carl: So, within a corporate group those I guess would be sort of the true repatriation of profits but within a group there are often other ways that money is moved back and forth between the entities. Common ones are royalties for things like trademark licences like Siemens or Mercedes they have the Canadian subsidiary for using that trademark, you should pay as a royalty whether to the German company or sometimes those trademarks are kept offshore. Another one is management fees. Sometimes you have got some back-office functions, or they are centrally located somewhere else in the world and so that ends up being an expense to the Canadian company thus reduces its taxable income and puts that income into another jurisdiction. All that said, any of those amounts you are also subject to our transfer pricing rules which pretty much applies in any OECD so between related groups you have got to pay an arm's length price. You cannot just pick a high or a low number that you think would be good for your business. You have got to do an arm's length price, and you have to have support for it.

Lars-Gerrit: Okay well thank you. Thank you, Carl that was very helpful. I think, by the way, do we have any questions in the audience? Not in the room I see but, no? Wonderful. Then yes, I am happy to pass on to Melissa to give this afternoon a bit of the French sparkle. Melissa is a Partner in our Montreal office and leader of the firm's national advertising and product regulatory group which is the largest such group in Canada. Welcome Melissa. Melissa will talk about the Quebec perspective, I think.

Melissa Tehrani: Good afternoon, everyone. I am happy to speak today about the Quebec sparkle and some of the key differences in Quebec law that foreign companies should be mindful of when they are doing business in Quebec.

So, I think the first thing to note is that the province of Quebec or [French] as colloquially referred to, is the second most populus province in the country. It also draws its heritage from the French legal traditions from France and therefore operates under a civil legal system which is distinct from the common law system and similar governance in the rest of Canada. So, we have the Civil Code of Quebec which is essentially the cornerstone for this system, and I think we may need to move on to the next slide just so that – there we go.

Beautiful Quebec flag. So, talking about the Civil Code of Quebec. It is the cornerstone of our legal system. It codifies the rules and principles that govern private law matters and some matters like contracts, property, family law. It is really the body of rules that sort of lays the foundations for all of the other laws in the province and I think that can be contrasted against the common law system in the other Canadian provinces which is must more based on case law traditional precedents and so whilst statues do exist in the common law provinces, I think the Courts rely a bit more heavily on past judicial decisions to set defining precedents.

So, if we move on to some of the more specific legal requirements and statues, you are likely to have heard of Quebec's French language laws. So, Quebec has a longstanding statute that is called the Charter of the French Language and the Charter mandates French as the only official language of business in commerce in the province. It has been around since 1970's but was more recently a mandate starting in 2020 to further strengthen and protect the French language. And although French is the predominate language and cornerstone of our province's identity and culture, French speakers still make up a minority across the rest of the country and so hence the emphasis on protecting and preserving the French language.

So, the charter governance French requirements pertain to various spheres of life Government and business in the province it governs the language of education, it governs the language of contracts, labour and unemployment, customer service as well and so Quebecers have the right to be served and informed in French. It governs the language of websites and corporate social media accounts and so if you have a website or a corporate social media account you are required to have an equivalent French version of that website or social account and so typically that would be achieved with a toggle at like the top right hand corner of your website where if you was to kind of click to switch between the English and French mirror websites.

The requirement to package and label your products in French is also granted in the Charter and so the general rule there is that all inscriptions on a product, on its packaging, on its labelling, have to be in French with equal prominence to any other language except for a few exceptions and an exception that has been making headlines over the last few years is the exception for recognised trademarks which I will not get into as our colleague Shelagh will be speaking to that a little later on.

So, we talked about websites, contracts, point of sale materials and outdoor signage must also be in French but rather than having to be equally bilingual they actually have to be markedly predominantly in French. The same rule applies for outdoor signage so think of retail French or storefront commercial French signage as of June 1, 2025, outdoor signage will follow the same rule for point of some materials and kind of signage in general which is that French have to be markedly predominant and so what does that mean? It means that if you display a non-French or a German business name or trademark on your storefront or retail front you are required to add French terms descriptions or even a French slogan that when you kind of take all the French additional slogans, descriptions, whatever it may be that you have added when taken together occupy twice the real estate of your non-French business name or trade mark and so the requirement after June 1 of next year will be that when you look at the Quebec landscape French will need to occupy two thirds of any kind of retail or outdoor front signage.

And although there are penalties and fines for non-compliance I did want to mention that the regulator is much more concerned about encouraging companies to comply as opposed to fining them and so by their own data the vast majority of complaints, I think it is roughly around 98% of complaints and enforcement are resolved without fines being levied so they are not looking to fine companies for not complying with province's language laws they are really looking to encourage companies to do that. But then aside from the regulatory risks of non-complying I'd be remiss if i didn't mention that French language preservation and protection is also very much a sensitive and political issue in the province and so negative PR may result if companies fail or refuse to comply.

If we move onto the next slide, please. I also wanted to touch upon Quebec's Consumer Protection Legislation. Quebec prides itself on being a very pro-consumer province and it has very unique consumer protection laws including a ban on commercial advertising to children under 13 years of age. We are actually only one of only three jurisdictions in the world that has such a strict ban on advertising to kids. The other two jurisdictions in Norway and Sweden and so here again you can kind of see that European influence come through in our legislation and our laws and this is an important consideration for businesses that are involved in marketing and advertising of products that are either solely intended for young children. So, for the toy industry but also manufacturers of goods and products that were not exclusively intended for children may still be highly appealing to kids and so you know a classic example of that might be specialty gourmet foods, the speciality German chocolates that we all love in Canada are the types of products that are not solely intended for kids but very much appealing to children.

The Quebec Consumer Protection Act also provides a legal warranty of good working order on all products that are sold to consumers in the province and what that warranty of good working order provides is that goods need to be durable for a reasonable period of time having regard to the price you pay, the use you made of the products if you used it a normal use versus abused the product etc, and so for instance a Gaggenau fridge which is a luxury high end kitchen appliance may be expected to last longer than a lower priced fridge or appliance. With that being said, though Bill 29 which received assent last year will establish a new legal warranty of good working order for a specific list of commonly used new consumer goods, appliances, electronics, etc. but the duration of which will be determined by regulation.

So, this is a notable departure from the current legal landscape where the duration of that legal warranty is pretty much left up to judicial interpretation. Again, a Gaggenau fridge will likely be up for the course required to lasting longer than a much less expensive fridge and so instead the warranty's specific timeframe will be formerly established through extensive regulatory standards and so we will have to wait and see what those are but those will touch upon household goods, tech and electronic products to name a few.

And so very quickly the last thing I wanted to touch on is Quebec's Law 25 which modernises the provinces privacy legislation and it introduced one of the most putative privacy laws in the world which was largely inspired but not identical to the GDPR and without going into the specific legal requirements I did want to mention that Law 25 introduces new data protection rights for individuals and it imposes obligations on organisations that process data such as mandatory impact assessments and privacy by default mechanisms. So overall some unique rules and requirements but also a unique culture and a great opportunity for companies looking to enter into the Canadian market so merci beaucoup, Danke Schön.

Lars-Gerrit: Thank you Melissa for this overview, very unique indeed so I am looking at the audience do we have any questions from the audience…nor in the room…nor virtually then I do have many questions. As a simple German corporate lawyer this sounds all very complicated is it really feasible for a non-investor to invest in Quebec….

Melissa: Oh absolutely…

Lars-Gerrit: ….when they do the assessment?

Melissa: ….yes I think at first flush the requirements may seem daunting but it is certainly workable and I think one of the major concerns that most non-French foreign companies are worried about are French language requirements.

But for a German company that likely also does business in other markets and jurisdictions there are French speaking consumers such as France, but I think the Quebec French language compliance rules might not be such a heavy lift. It is also worth noting that you know Quebec is the second most popular province in the country and so it will represent a substantial proportion of your…of the country's consumer base and if you are looking to capitalise on the Canadian market then I think that is definitely an important market.

But I did want to give you one example, so a number of years ago we assisted a European company, one of the largest retailers in the world with thousands of locations globally and opening their first store in Canada. And for their first store they actually chose Quebec, Rozard which is just outside of Montreal, so despite the perceived challenges of doing business in Quebec that particular multi-national retailer chose Quebec for their first Canadian footprint and so today they have expanded to upwards of 20 stores across the country and if anything that is just one example of a European company that entered into the Canadian market, Quebec specifically and is enjoying great success.

Lars-Gerrit: Well, thank you Melissa that is really reassuring and I thank you for that great contribution.

Melissa: My pleasure.

Lars-Gerrit: Thank you. So, we are coming to the end of the second part of this afternoon we are a bit ahead of time.

Mathias: Welcome back everybody to the third part of our programme today. We now have a very exciting panel of speakers for you both here in Frankfurt on site and virtually in our Canadian offices.

This third part is dedicated to exploring building Canadian/German opportunities and protecting interest and for this third part we have not only Gowling speakers but we have also have the great pleasure of having been able to secure the participation of some external speakers who you already can see at the front on the panel right here but who I am going to be introducing in a minute, if I may, but before we get to the panel and discuss with them investing in Canada I would like to now ask you to welcome Wendy Wagner from our Ottawa office.

Wendy is the leader of the Canadian International Trades Group within Gowling WLG and Wendy is going to talk about CETA and the importance of trade and I dare say that is probably something that is of great interest to all of us seeing what is on the horizon in the US and the incoming new administration.

Wendy over to you, hi.

Wendy Wagner: Good afternoon to all the attendees I am very sorry I cannot be there in person and see all your lovely faces but hopefully I can set the stage a bit for this panel by talking a little bit about the CETA Agreement. So yeah, CETA stands for Canada-EU Comprehensive Economic and Trade Agreement and similar to most trade agreements that you will be familiar with it does facilitate cross-border movement in goods and it does that by reducing tariffs to zero for 98% of all goods that are traded between Europe and Canada.

But the comprehensive part of the title and the agreement is interesting because it is really considered a next generation type of trade agreement because it addresses a lot more than just tariffs on goods which is really helpful in today's context because we do not just trade goods, we trade services and participate in procurement markets and other economic activity so services is one of the areas that the agreement addresses. The statistic in the slide is actually incorrect I think it was probably AI generated.

We have actually done much better in the services area with the CETA Agreement than is indicated here so it is actually EU exports of services have increased 54% since it came into effect and imports have increased 74% of services and CETA really opens up the services market because it does something unique in trade agreements. It takes what is called a negative list approach which means that all services sectors are covered by the agreement unless they are specifically excluded and essentially this means that neither Canadian nor EU regulators are able to limit the participation of the other party in almost all services sectors like transportation, financial services, insurance, communication, a broad range of service sectors. And the trade and services are also facilitated under CETA by favourable business immigration rules that are also noted on the slide and they allow for temporary entry of employees from the other jurisdiction and liberal issuance of work visas for business visitors and contractors and investors so that is really helpful to that economic activity as well.

The public procurement rules in CETA are among the most interesting because they allow European companies access not only to Canada's Federal Government procurement but also to sub-central procurement so procurement by the provinces and municipalities. And I will just give one recent example of how this works or translates into practice transportation is a big area procurement obviously and in a recent Quebec procurement of rail cars the procurement requirements were set so that you had to supply rail cars that were either Canadian origin or European origin because Europe is the only jurisdiction that benefits from access to the procurement markets of municipality of that sub-central procurement so you know a really concrete example of how EU companies can access our procurement market.

So, I will just ask you move to the next slide. So one thing to note about the CETA Agreement is that it is not static it continues to evolve and adapt and grow and similar to services goods trade has increased more than 50% since the agreement came into force and one of the areas in which it continues to grow or develop or be enhanced is in the mutual recognition of professional qualifications and we have started in the area of architects and agreement has already been issued so you can see if you are involved in services, markets in particular how important it is to be able to have your employees or your expertise provide services within the other jurisdiction in that seamless kind of way and professional recognition is really quite key to that.

Another area where things have developed a lot or are developing is in the investment dispute resolution that was a quite a controversial part of CETA. Some of you may have had heard the term ISDS so Investor State Dispute Settlement. It is something that is used rarely and there are some measures that are being taken to help small and medium-sized companies have greater access to that dispute settlement. But really you know you only have the ability as an investor to bring dispute settlement proceedings when the actions of the other country have been fairly egregious.

One thing I just want to close on is although ISDS' dispute settlement is not you know frequently used under the CETA Agreement and is only available in those sort of more extreme cases one thing we have really found in representing our clients is that we use CETA a lot as an advocacy tool to make sure that the regulatory environment within Canada remains favourable for EU, access to our market, so there has been many circumstances where we have been able to encounter a Government proposal to adopt you know unfavourable labelling regulations or other forms of non-terror failures based on the fact that there is this international trade agreement and it is very helpful from that perspective and from the Canadian Government perspective. They are obligated to consider their international obligations under CETA whenever they are adopting a new framework of law so that has been helpful as well.

So, I will end there and turn it over to the next speaker and thanks for your time again.

Mathias: Wendy thank you so much before you go and maybe one question you mentioned the advantages that European companies have potentially in procurement tenders like in the transportation example you gave. I believe are there any other real-life examples of European companies profiting and benefits from CETA potentially one that you have advised on that you can sort of tell us about to get a better understanding of what the preferred position is and the beneficial position of European companies?

Wendy: Yeah you know nothing is coming to mind as a specific example although in the procurements phase there have been many just because its opened up the opportunity so much at that sub-central level as well so really I think it is a matter of knowing where to find that information and access those opportunities which is something that you know we frequently advise on and once you have that knowledge and you have something to offer you are pretty much good to go.

Mathias: Well, thank you that is very helpful thank you Wendy.

And this brings us now to the next part of this third part of the programme which is a panel discussion amongst three very esteemed gentleman, two of which we have on-site with us here today and we thank them immensely for taking their time out of their busy schedules to be with us and one dialling in virtually.

I will start with Lukas Kirstgen. Lukas of course is dialling in you see him on the screen there, Lukas is a Vice President of the Canadian German Chamber of Industry and Commerce and with us here today are to my left and your right, hope I am getting this right, is of course Dejan Velichkov, Dejan is a Market Director Europe and UAE with Invest in Canada, Invest in Canada being a Canadian Government Agency promoting investments in Canada as the name says and to my further right, your further…sorry further left, your further right is Ernst Lueger is a consul for Economic Affairs with Invest Ontario also a Government Agency this time of the province of Ontario and promoting investment in Ontario.

Lukas, Ernst you are here to talk to us about the benefits and the ways and means of investing in Canada. Who wants to start telling us what they are? Dejan you potentially.

Dejan Velichkov: Thank you Mathias so as you mentioned you know we invest in Canada throughout Government Agency and then as the name says we provide direct support to global investors considering at Canada for expansions. I am within a group that is called Investor Services so we provide market intelligence, kelp companies, we do investment analysis guidance for some of the Governments incentives and so they can now get whole process in a more efficient manner and then we can work with different levels of Government and in Ontario we had many successors in the past year and what I would like to start with is may we can talk first about some of the general benefits and what we are hearing from the investor etc. and then we can then kind of go more into the incentives and what the Government support is but I think nowadays what we are hearing and what Canada has to offer and it is becoming very attractive is Canada is predictable and stable country and within the current geopolitical context having a country with predictable and stable policies.

It is very in. So what we are hearing from investors they like Canada because predictable processes is boring also the regulatory side it takes some time but things are done and they are not shifting too much left or right or up and down so I think that is number one thing that clients are providing feedback to us about Canada.

I think the second part in this you know current context is Canada is very much towards adoption of clean technologies and what really sets Canada apart especially in North American context is our focus and dedication to clean energy, so Canada overall gets abouts 85% of our energy generation is emission free. Energy is like a provincial regional jurisdiction and there are even stages of 100% renewable and energy and industrial prices that are three to four times more competitive that Europe so for a lot of processes that are energy intensive namely a critical mineral processes refining specialty chemicals, and other it is very important and I was today here because of food ingredients conference and they are telling me within the food industry the carbon footprint of the ingredients is measured and it can be an advantage for those that share the ability to operate in an environment where they have access to clean and affordable energy.

I think that is really a major differentiate. I would say the second one we just heard from Wendy and it is about the market access in the international context that companies operating in Canada take advantage of. Even in environment in a more unpredictable international environment Canada is in the position where it has very reliable strong relationship on trade in a North American context.

It also has free trade with European Union and in the last 30 years it has worked tirelessly to form trade agreements with other countries in Asia, Latin America so I think that is really it has worked to future proof for companies operating in Canada to have access without tariffs to other markets. I think…let us say another natural advantage for companies.

The third one would be the talent. From different dimensions first talent in terms of while companies globally are talking about talent crunch it also happens in Canada, but we are hearing from companies that in a talent crunch context globally it is easier to hire talent in Canada for multiple reasons.

First of all, we have one of the highest percentage of educated people with post-secondary education, second the country is a magnet for international students to choose Canada because of the strength and the quality of the institutions to come and build their life after they have studied there and it is very open compared to other countries internationally for highly skilled people from around the world coming to the country so that helps us in supply of talent in the market.

Last year I believe close to probably half a million people joined to live permanently in Canada so that is when you compare how much percentage wise is in a country places like Toronto have about 50% of the population really not being born in Canada. So….and what I am, an immigrant myself like New Canadian, so what really it is a unique place where for people that are not there born, they are coming recently they feel like belong there and something works out well in society that everyone gets along well.

I think that is really unique but from a business perspective it really does not add pressure to the cost of talent so that is one way so the talent can be hired is highly skilled and it is more affordable compared to United States. So that is another one and I maybe will just mention the other one I will Ernst who is kind of also from an Ontario perspective share and we can see what Lukas can share with us from the feedback they are getting from their members from the Chamber.

I think the last one from myself would be Government support for innovation and Government support for the supply chains of the future.

Mathias: Thank you very much Dejan it is very refreshing in this day and age and in this particular climate to hear somebody talk about multi ethnicities being an advantage of a country and in economy and it is also interesting to hear that apparently stability is the 'new black' when it comes to the virtues of countries.

Ernst, I saw you nodding a lot while Dejan was talking do you care to expand?

Ernst Lueger: Yes, sure I am happy to. So, I mean Ontario has over 40% of Canada's population, over 40% of Canada's GDP everything that Dejan just said it applies to Ontario as well. What I would highlight is something that Dejan mentioned right at the end there which is innovation and supply chain. So, what I think from an Ontario perspective is extremely attractive and very attractive to German companies is that one, we know how to make things, we know how to make complicated things very well and we know how to innovate, and you do not find a lot of jurisdictions that have that overlap.

We have got the second largest tech cluster in North America behind only Silicone Valley, and we have the second largest automotive cluster behind Michigan. So, you have got sort of you know the manufacturing prowess in automotive of Detroit with San Franscisco's ability to create innovation and that is a real selling point and you see it when in the activities of German companies.

We have got companies like Volkswagen their subsidiary PowerCo are going to be making EV batteries in Ontario it is going to be when it is finished the building will be the largest building in Canada. So, using the idea of the scale of that investment but on the sort of innovation side Mercedes Benz announced earlier this year that they were going to be opening up innovation incubators in three locations in Ontario to scout talent, to scout tech, to scout innovation. So, I think that those two examples from massive German companies that are well known for making things and innovating and that is a real vote of confidence and a real show of I think our ability to provide those attractive things to German companies in particular.

Mathias: Thank you, Ernst. Lukas this brings us to you, what is your view, what is the view of your members on investing in Canada and on the benefits of investing in Canada and how the Canadian Government both in the Federal level end on the provincial levels support that?

Lukas Kirstgen: Sure, thank you Mathias and thank you in general to the BUJ and to Gowlings for having me today. It is always a pleasure to be a part of events like that and to share how we as the Canadian German Chamber support Canadian and German companies.

Before I answer your question, I think it might be a good idea to give a brief overview about what the Chambers of Commerce Abroad in general do and maybe like a Canadian German Chamber. I think it is safe to assume that all of you have somewhat of an idea what the Chambers of Commerce and industry in Germany do the E-cars.

However when it comes to the Chamber of Commerce Abroad I think that like fewer people know of them and know what they actually do so as the name implies Chambers of Commerce Abroad were implemented to support Government businesses and German trade abroad and I think that the first one was founded in 1894 in Brussels and as of today we have 150 locations in 93 countries so Gowling has a bit of catching up to do. The Chambers of Commerce Abroad in general are subsidised by the Federal Ministry of Economics and Climate Action even though we are just subsidised we are not fully funded they are kerfuffle but the kerfuffle is affecting like the problems going on in Berlin at this moment so I had a difficult time convincing our Board that I can fly to Frankfurt because I would have loved to join in person but it is webinars for now.

And yeah, so in Canada we opened our first office in 1968 in Montreal but today we have an office in Toronto, and we serve all of Canada from coast to coast to coast and our mission is exactly what this part three of this event is about. It is about building Canadian German opportunities by supporting Canadian and German companies in Canada and in Germany and so what do we do.

We have in total we have three core functions, first of all we are the official representative of the German industry. So, we tend to use a sentence, I actually wrote it down, because I cannot remember it and if you ask me, it sounds a bit pompous but it is 'that through us the German industry speaks locally with a consistent voice perceptible to all stakeholders'. What I said, so what I mean by that, is that we use our unique position to try and promote favourable business environments in Canada and Germany.

And our second role is that we are member organisations similar to E-cars in Germany however it is all mandatory to be a part of the Canadian German Chamber if you want to do business here. However, obviously we have a large network, and we can have members reach potential partners and increase their visibility and we organise about 40 events and delegations every year for example, next year to the Hanover Messe and hydrogen hubs so it is obviously a good idea for a new company in Canada to be a member.

And the last role is that we are service providers so we offer something that we would like to call the one-stop-shop so if a German company wants to come to Canada we try and provide everything from pre-market check, market research, business partner search over incorporating what you heard from David and payroll and bookkeeping and all of that and in that we work very closely with experts and Dejan and Ernst, all firms at Gowlings for that matter. So, I think is enough background to just for the people that were not familiar with what the German Chamber does and back to your question I think I wholeheartedly agree with what Dejan and Ernst just said so just in general we would say we see lots of problems you need for German companies.

You have heard today that Canada is one of the largest economies in the world. We are stable economic and political conditions I think Dejan just called it boring but let's call it stable for now. The location is perfect to access global markets, and the sustainability goals are comparable to Germany. We have just heard that some of the provinces are completely at net zero already so that offers lots of opportunities for corporation.

One point that I do not know if that was made clear I think Todd in part one mentioned I mean obviously he mentioned that we bring exceptional talent regarding ice hockey to Canada but I think as….we are connected by much more than that. I think that when you look at our patriot and our values, we are very inter-connected and that makes us likeminded partners and lots of German companies express exactly that when they come here. It is for a lot of people when they come here it is home away from relatively quickly and yeah, I mean you have heard the Volkswagen investment from several people already. I think especially in the last couple of months or maybe years their already close partnership has been intensified. Their 4 billion Euro investment with the giga factory is one but there are a few more. Lint for example has a $2 billion investment to provide clean hydrogen, K+S is investing three billion euros in Saskatchewan, and I think that is probably information they articulate themself.

Similar to Dejan they…I don't think they said "worry" but they are obviously they are somewhat excited about the less bureaucratic ways of doing business in Saskatchewan.

One investment I am slightly sceptical about and put it this way is that Deutscher Bank signed a multi-billion Euro contract for the extension and maintenance of the local transit system here in Ontario and well let's see how that goes.

I could share some examples of our members who have been successful here, the jump across the pond but I want to be mindful of the time. It is the first hybrid event that I am doing and it is a bit difficult to pick up on social cues because I can barely see all of you so just tell me to stop talking or keep going. Whatever you want.

Mathias: Thank you, Lukas. I do not need to stop you from talking. I am just saying thank you for that. But we have been talking about Canada being an anchor of stability on the North American continent. Now if I may, I want to pour a little water into the wine if I may. We all know the US has had their General Elections and new administration is coming in, but the US are not the only country to have General Elections in the foreseeable time. Canada is, as I understand, due to have General Elections, at the latest if my lawyer tells me correctly, by October of next year. At the same time, I understand that there is a bit of a, not concern, but it is absolutely in the air that the federal government, and the composition of the federal government, may change and it may change dramatically. Not least because there is also a certain sentiment in the Canadian general population towards the right end of the political spectrum. What does all that tell us about the stability of Canada and do you see anything that people ought to be aware of in that respect?

I do not know who will want to go first because this is a potentially more challenging question.

Ernst: Yes, I am happy to give it a shot. So, I would say that one thing that the boring nature of Canada also connotates is a stability and consensus across major political parties. I think that a good example would be the Ontario Government right now is a conservative Government. The federal Government is liberal by the cooperation is extremely good. You regularly see and hear them complimenting each other, particularly when it comes to measures that are intended to support businesses. So, there is I think this broad-based consensus that regardless of who is charge, who is in power, making sure that we have a competitive internationally attractive economy is going to be one of the highest priorities of whoever is in Government, and I just do not see that changing.

One of the reasons I do not see it changing is that any time, even the opposition at the federal level, they do not criticise the approach of the current Government when it comes to economic policy. Especially when it comes to economic policy, yes. But when it comes to dealing, for example, with foreign investors. Some of the support that has been put in place, some of the work that has been done with companies coming in, you know you will hear some comments maybe around the margins of, well is that really the most efficient way to do that? But there is no broad based, lambasting of these kinds of investments. So, I would say that that makes me quite positive that even a change in Government at whatever level, would not bring with it a massive change and approach.

Mathias: Dejan do you share these views?

Dejan: Absolutely I think the cooperation between the current federal Government, which is one side of the spectrum especially with the provincial Government in Ontario, together the collaboration and the one team approach, you can appreciate some of these companies and some of the decisions, especially with German investors, that Lucas mentioned, they need investors and executors of these companies need some convincing stories to be told to make those decisions and I think Canada has not always been able to convince but also to deliver with kind of working together and I think, I am not a political analysist, I advise on investment companies but what I can see one way to predict the future is if we look in the past and the history and then if we do that in Canada, compared to some other countries, we can see that I agree with Ernst that we are a predictable place when things come, people work strings, the differences for the best interest of the country and that has consistently been happening and being delivered.

Mathias: Alright, let us to go Lukas because he is the objective observer. Lukas are these two gentlemen right in their assessment?

Lukas: Unfortunately, I left my crystal ball at home. However, the only thing I can add to that, I do agree with both of them. The only thing I can add to that is that we did not hear from our members that they are worried about what is going to happen in the future which was different a couple of years ago with the election in the States when we had several companies say they did not feel comfortable anymore in the States and they were planning on moving north and let us see what happens from that point of view in the next couple of months but yes, no we did not hear any worry.

Mathias: Okay. Thank you so much. I would say then and any infamous last words, we continue with the programme. Dejan, it looks like you …

Dejan: I would just one more thing. Based on maybe what has happened in the past on the North American continent or recently we have seen in the past here a change of trend of how Europeans, but also German companies, think and what they do when they kind of expand over the pond. The change that we hear and the pattern of their behaviour about investment is changing. In the past it used to be you are thinking about North American market. You are setting up operations in North American going to United States and then we will think about Canada, Mexico and what else is there. What we are seeing now with this establishing of new supply chains, Canada having likeminded economy and values like Europe, you are seeing these companies making one, first of a kind, investments and going to Canada first when they are thinking about North America. And I will end it with that.

Mathias: Well, thank you very much Dejan. That is a good final statement. We now changing the perspective, and we are turning to Peter Misek. Peter is joining us today via Teams as well. Peter you are a Managing Partner with Framework Venture Partners, and I think you have stories to share with us on what it is like as a Canadian investor investing in Germany and the types of experiences you have had in those endeavours. Hi.

Peter Misek: Hello. Well, I will spend 15 seconds giving a little bit of background on Framework. So, we see 1000 companies a month. We track 50,000 companies across North America and Western Europe, and I have been doing this fulltime and parttime for over 25 years so it has been a lot of fun and I feel very privileged to do that. So, thank you for having me.

As far as doing business in Germany. We partner with a fund called The N Capital. It is actually co-headquartered in Berlin. I love the Berlin ecosystem. I really dislike the corporate loopholes I have to jump through to invest in Germany. The whole Power of Attorney postulate is an absolute misery. It creates huge friction and complexity and if I could make a suggestion, please find a way to modernise that. That is a relic of a long time ago and if you found a way to modernise it, you would find more capital flowing into Germany in a big way. Berlin is massive…

Mathias: Yes, we are busy taking notes here.

Peter: Yes, Berlin is massive. We have two investments. A company called Scale Hub and a company called Hypatos and Hypatos is a world leader in document AI and LLMs and will come into companies and reduce costs by up to 95% to 99%. So, it is pretty phenomenal tech built in Berlin.

Mathias: So other than the need for getting rid of laws on Powers of Attorney. What else is your specific experience in investing in Germany? Are there any benefits to it? I mean, in the end you did it didn't you?

Peter: Yes, massive benefits. Very, very high technical skilled workforce. The universities are wonderful. The average education is higher than North America and the number of PHDs I run into in Germany. I don't know if it is double or triple what I run into North America, but it is much higher and particularly in AI wouldn't you want to be ablet to have auditability, transparency and data compliance. I think they are world class, but I want to point out that the vast majority of revenue for these companies actually derive from the United States so even though the tech is built in Germany I would say formed in Germany the market really does shift very quickly to the United States.

Mathias: In your view what should a German company do no matter what their size is, or it may very much depend on their size in order to make themselves attractive for Canadian investors?

Peter: The big thing is revenue growth is going to be a huge driver obsolete revenue levels and unit economics, so how do you acquire customers profitably and then to make yourself attractive is having a great go-to-market strategy and I think go-to-market is a challenge that both German and Canadian companies face. All of our successful companies struggle at some point with go-to-market in a big way so sales and marketing and for that we would strongly recommend getting as many Americans involved in the go-to-market as possible. We are just much better bullshitters than the rest of us so get them involved.

Mathias: Again, duly noted but to go back to the assort of particularities or peculiarities of Canada Canadians and what they are looking for and we have heard a lot about stability, and they are being boring almost being a virtue and I can absolutely subscribe to that. Is there anything in particular that Canadian investors look for other than the never investors might look for, is there any particular way in which companies that do meet the requirements can make themselves known to Canadian investors.

Peter: Yeah, the big way to get known is your key customers receive testimonials. Testimonials are the number one way that we scout and find companies so just to give everyone an idea. There are roughly two million software companies on the planet, just over a million in North America and about half a million in Western Europe. To stick out and to stand out you really, really need testimonials. Are your customers willing to talk about how it was to work with you, what the value you did. As an example, For HyperToes we had a customer come out and say that they actually reduced costs in accounts when accounts were payable by 95%. The moment that they did that, and they stood behind the sales exploded for the company so please, please, please get testimonials.

Mathias: In your view does it make a difference whether a company is already themselves invested in Canada and for to be attractive to Canadian investors, otherwise if there some sort of reciprocity in the sense of that, you know if they are willing to invest in Canada and if they are willing to thereby demonstrate a certain amount of stability that is a virtue that we are looking for.

Peter: No, our world is much more chaotic. Stability is more transient in our world. You know a company will be top of the world for a period time and then all of a sudden, a new large language model or generative AI will come out and desecrate them, so stability is something far less we look for. We look for what we call technical development cycles, the speed at which you can add code, the speed at which you can release product, the speed at which you can adapt to market conditions in competitive responses and that is the most important technology and product perspective, we look for and that is what German companies seem to be actually really good at.

Mathias: You know what, we will stop right here on that note because that is exactly what we wanted to hear. Thank you very much Peter for being with us and sharing your wisdom today. I would now like to hand over the baton to the head of intellectual property department here at Gowling WLG in Germany, my colleague, Mari Kavruk over you.

Miray Kavruk: Thank you very much Mattias and being an IP lawyer, I cannot help but say and I'm sure Sheila will agree save the best for last, so we are coming to IP, and I have the great pleasure to introduce Shelagh Carnegie to you. Shelagh is an IP partner based in our Toronto office, and she is the co-head of the firm's global intellectual property practice. Shelagh it is great to have you with us and I will hand right over to you, and we are all excited to hear about IP in Canada.

Shelagh Carnegie: thank you very much Mari and I hope you can all hear me and congratulations on making it to the very last formal presentation today so as Mari said I am Shelagh Carnegie and it is my pleasure to give you a very quick and very high level overview of IP protection in Canada and it will please you to know it is not all that different from Germany. So first let's talk about patents. As you probably know patents are a statutory and territory right so protection in the US or the EU is not going to extend to Canada. A patent grants exclusive rights to an invention that is useful and inventive, and it gives the patentee to the legal authority to provide others from making or selling the invention for up to 20 years in Canada. In exchange, the patent applicant must publicly disclose how to use the invention. So, the concept of novelty underpins patent protection everywhere. If the invention is disclosed before the patent is filed, the patent may not be valid. One important difference between Germany and Canada, and the US, is that under Canadian law you have one year from the time of earliest disclosure to file that patent, and it is still valid. In Germany, subject to a very narrow six-month exception for exhibitions any evidence of public disclosure at all will invalidate that invention. So, top patent holders as I am sure will come as any surprise to you in Germany include Bosch, Siemens and of course the automotive companies like Mercedes, BMW and Volkswagen. There were patents to protect the functionality of an invention industrial designs is what we call them in Canada, protective products for unique appearance, so its shape, its pattern or its augmentation. In Canada, industrial design registration provides for a maximum of 15 years of protection. You can get similar protection in Germany for up to 25 years and it requires some renewals, and it is particularly valuable for businesses in the consumer goods field so furniture, jewellery, graphical user interfaces, purses and shoes and it safeguards like unique aesthetic appeal. Some of the top holders in Canada that you will be familiar with include Apple, Lulu Lemming, General Motors and Harry Winston.

Trade secrets as again, you are probably aware are a firm of IP that protect confidential information that has commercial value derived specifically from remaining a secret. Formulas and processes fall into this category and some of the most famous trade secrets in the world are of course Coca-Cola's formula and the delicious Kentucky Fried Chicken recipe. It is the value of the trade secret is that it can be indefinite protection as long as it remains a secret. This group might find interesting is I recently attended a panel of in-house counsel in Detroit for all of the automotive companies and their suppliers and they indicated that they were increasingly interested in trade secret protection because they were concerned about the use of A1 by their inventors and what that might mean for the validity of the patents. Before I get to my favourite topic, trademarks, I am just going to touch on copyright, it is very similar to Germany, copyright in Canada protects original works like literary, dramatic, musical and artistic works and last for the life of the author plus, 70 years, the protection arises automatically upon creation so formal registration is not required in Canada to enforce rights. However, we have a body that does register copyright here and it is deemed presumed evidence of copyright protection, so it is very useful in any dispute. I just want to briefly touch on the impact of AI on the validity of patents and copyright. In Canada this is still somewhat of an open question, but it appears to be trending in the direction that while a human being must be listed as an investor or the creator of copyright protective works, AI can be used as a tool so long as sufficient human direction was involved that appears to be the way that it is going.

And lastly, I just want to talk a little bit more about trademark protection in Canada and I am doing that because every company that comes to Canada has at least one brand. So, as you are likely aware, trademarks can take many forms and you can register many of them in Canada including words, logos, sounds, sense, textures, holograms, moving images and even the shape of a product if it has sufficient reputation. The trademark is protected only in association with the specific goods and services that brands, so BMW and Porsche are for cars, not apple sauce and Adidas is for clothing and shoes, not Kentucky Fried Chicken.

An important feature of Canadian and US regimes, I think it is similar in Germany, but it is different in many different places in the world is that common trademark rights can arise just by virtue of using a trademark and these we call them common law rights in Canada and you give the user the exclusive rights but only in the geographic area of the reputation and only to the extent that they can prove an exclusive reputation in that mark for those goods. That is great. You can come here; you can start doing business and you may obtain some rights, but we always recommend seeking registered rights and not relying just on your use. Registration does come with a host of benefits two of the main ones being like you have automatic nationwide protection and enforceability in your brand if you get a registration. Several of our speakers talked about the sheer size and scale of Canada so you can imagine if you are only using your brand in Toronto and someone copies it in Vancouver or Halifax, you can rely on a registration to enforce your rights in that brand and prevent them from using it but if you don't have a registration and you have no use or reputation in Vancouver or Halifax, you are not going to be able to stop them and you are going to lose that exclusivity in Canada and registrations also allow you to take advantage of what I call some free enforcement mechanisms. We have a Customs Assistance Programme that you can register for to prevent counterfeits at the border, you need a registration to apply for that and at least an application is required to take advantage of some online takedown platforms like the Amazon Brand Registry. Fortunately you do not need, unlike the US, you do not need to prove use to obtain a registration in Canada so you can seek protection years and years before you get here and in this way, you kind of plant a flag on our registry and the trademarks office will block any confusingly similar marks that are followed after yours and they will do that for you. But it is also notice to the industry that you are coming and that you intend to use your brand here and that alone will scare people off. Trademarks are registered for ten years, and they are renewable indefinitely so long as you continue to use them. In Canada, if you fail to use the mark for three years without an excusing circumstance, we can have it cancelled off the register on a summary basis. In Germany, I know that period of time is five years.

Before registering your trademark, we strongly recommend that you conduct availability searches in Canada. These look for potential obstacles and red flags and can help you maybe readjust your branding strategy before you get here and before you spend money on applying to register the mark.

And lastly, I just want to touch on Quebec. Melissa mentioned that I would be speaking about this as she mentioned to the group that everything in Quebec has to be translated into French subject to some exceptions. One of those exceptions is a recognised trademark. A recognised trademark does not have to be registered, but it is much easier to deal with and an angry regulator if you wave a registration at them and the way that it is going to work as of June 2025 with the new law that Melissa was referencing says on packaging and labelling even if you have a recognised trademark, any words that are considered descriptive or generic in that mark still have to be translated unless they are the primary brand of the product or designation of origin and for signage which is treated differently that packaging for some reason recognised trademarks are exempt. You don't have to translate the descriptive original recording but as Melissa was mentioning, you need to give twice the space to the French text as opposed to the German or the English text.

And that wraps up our intellectual property review so thank you very much for your attention this late in the day.

Miray: Thank you very much Shelagh. I think that was very comprehensive and indeed as you said the systems really are not that different and I think what the systems also have in common is that the protection is of equal importance so if you have maybe one or two more minutes, I would like to touch upon one of our favourite topics so trademarks. We both know about the importance of trademarks when it comes to protecting your products or a company's name about it has a high importance and value for a company's reputation and market recognition, so Shelagh the question to you is what three things should a German company think of before introducing a brand in Canada?

Shelagh: In the context of boring as we are as Canadians which we have heard several times, we also have some very enterprising Canadians that will look at the EU and the US and see what's popular and they will register your brand before you get here so those ones are slightly more exciting. Because of that I always recommend do your availability search, know what is on our register already and apply early. It is taking our trademarks office four years to get to registration so you have many, many years to get yourself on the register, plant your flag and I can delay it as well so that you are holding your spot and you don't have that problem with people looking across the border, and seeing that you have your popular product and applying to register it here. That is just a headache as you can imagine so do the availability search, apply early and if you are going to be operating in Quebec you are going to want to lock down what your packaging and labelling has to look like with all of these, there's an exception for trademarks but there are exceptions within there and it is not an easy landscape to navigate right now, but we can certainly help you do it so those are the three.

Miray: Thank you very. I am just looking into the audience is there any questions on this so exciting topic of trademarks and IP? Guess not. Maybe later on but thank you very much Shelagh and looking at the time, I'm handing over back to Matthias.

Matthias: thank you very much. I think there is not very much left for me other than to ask everybody here in the room to give our panellists a hand maybe for the time and the wisdom that they have shared with us.