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Cross-border smarts help companies reap rewards

Mon, Jul 14th 2008 12:00 am
By JANE SCHMITT

For Buffalo attorney Thomas Keable, spending 50 bucks every five years for a NEXUS membership is money well-spent.

It gives him border-crossing privileges that make frequent trips across the Peace Bridge a breeze, saving him time, gas and frustration when regular inspection lines are jammed with motorists coming and going.

"I spend a day a week in the Toronto area," says Keable, a partner in the Buffalo firm of Gross Shuman Brizdle & Gilfillan PC, which has a Canadian office. "I have been traveling there for close to 20 years now to essentially practice U.S. law for Canadians."

He adds: "I'm a big fan of NEXUS."

So, too, must be numerous other professionals and business owners involved in international trade around the Golden Horseshoe, the region that links Toronto, Buffalo and other metro areas through an interdependence of goods, services and transportation routes.

Indeed, the flow of people and products across U.S./Canada bridges was celebrated May 8 in Buffalo at the 13th annual World Trade Celebration. It's a networking event that attracts hundreds of representatives from area manufacturers, distributors, professional service groups, government and trade-related companies, according to World Trade Center Buffalo Niagara.

"Since 1996, (we have) presented World Trade Celebration to bring the trade community together to recognize the benefits of trade and commerce for our binational region," the center said in a press release.

Rich Products Corp., with an operation just over the border in Fort Erie, knows all about those benefits. Other Buffalo area companies with a strong Canadian presence include Calamar Inc., Koike Aronson Inc., KegWorks, U-C Coatings Corp., Columbus McKinnon Corp. and M&T Bank, to name a few.

"We like to see all of the companies in the Buffalo area be successful, and we would encourage them not to ignore the Canadian market," Keable says. "And I think the savvy, successful ones don't."

Canadian companies, likewise, are thinking of the big picture when they decide to dip their toe in the U.S. market.

"My suggestion, first, is that the company needs to stay focused on the business end of things," Keable says. "In other words, the driving force needs to be: What does the business need to have and do to be successful in the U.S.? The answer to that is probably the same things that made it successful in Canada: good people, products and services.

"They need to find ways to efficiently and effectively deliver those in the U.S."

It's called the Golden Horseshoe for a reason, says attorney Daniel Joyce, a partner in Jaeckle Fleischmann & Mugel LLP in Buffalo.

"There is a market to the north, and the biggest population center in Canada is within an hour or two's drive of us," says Joyce, who focuses on corporate and immigration law. "Conversely, Canada sees (opportunity) to the south that they can reach. So I think the companies situated here in Western New York have to acknowledge the market potential of Southern Ontario and Canada as a whole, and we see that in all sorts of ways."

There are boundaries but not necessarily barriers to cross-border endeavors, Joyce says.

"If we do worry about it, it is (because of) perception problems more than real problems, because the flow of people and goods is working well," he says. "Whether you're a retailer or manufacturer or provide a service, I think people here realize that there is a customer base in Southern Ontario that they can surf."

Keep in mind that it's not an "open border" in terms of immigration, Joyce says, and companies on both sides are subject to enforcement issues, tax laws and other legal complexities, and licensing restrictions. That's where professional advisers can help.

"You must have good people to advise you on the different things you have to do, but the reality is that the U.S. and Canada are major trading partners," says Mark Janulewicz, a CPA and partner in the accounting firm of Lumsden & McCormick, Buffalo. "They have made it fairly easy, between NAFTA and the U.S.-Canada Income Tax Treaty, for businesses to come into the U.S.

"That being said, there isn't a (barrier), but there is a ton of complexity ... There are traps you can fall into. I see more problems with payroll tax and sales tax than anything else."

He says his firm does a lot of "inbound work," referring to Canadian companies eyeing the Buffalo Niagara region. "There is so much of it coming across the border," Janulewicz says.

Michael Berger, meanwhile, is senior partner in the Buffalo firm of Berger & Berger. He has been practicing immigration law for more than 35 years.

His advice to companies and individuals? "Know what you're doing and do it right."

He says cross-border expansion is a two-way street, adding, "We should be able to market to the (rest of the) U.S. that we are the gateway to Canada, and then to Canada that we are the gateway to the U.S. It's a two-way portal."

Follow the rules to prevent legal and immigration problems, he advises.

"One of the first things that we tell people is, make sure you get proper information so you can avoid a problem," Berger says. "At the border today, the best thing you can do is avoid a problem. Once you have a problem, it's very difficult to undo it.

"We tell our Canadian clients, ‘Don't come to the border and lie about what you're doing. Find the right way to come in. Don't lie about what your people are going to do in the U.S.' ... People come to the border and say, ‘Oh, I'm coming down to visit my cousin' and they have a box of (product) samples in their trunk. (If) they get caught, they're dead meat - expedited removal, and you'll be barred for five years.

"Fraud happens a lot at our border," Berger says. "It's a big problem."

Regular contributor Jane Schmitt is an Amherst freelance writer.