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Montreal Gazette
2 days ago
- Business
- Montreal Gazette
‘Stable' Quebec avoids a second credit rating downgrade
Quebec News By QUEBEC — A second credit rating agency has taken a look at the Quebec government's finances and says it is comfortable with the province's debt situation. In a statement issued Tuesday, the Canadian agency DBRS decided to maintain Quebec's credit rating, which determines the costs of borrowing to finance the debt, at AA (low) with a 'stable perspective.' The DBRS decision is the opposite of the decision to lower Quebec's credit rating by another agency, Standard and Poor's, in April. S&P lowered Quebec's rating from AA- to A+. It was the first time in 30 years that Quebec suffered a credit downgrade. It came as a blow to Premier François Legault's government, which was first elected in 2018 promising sound fiscal management. 'Because or the ongoing tariff threat, Morningstar DBRS anticipates some near-term deterioration in Quebec's fiscal and debt metrics, potentially reducing flexibility within its current credit ratings,' DBRS said in a statement. 'However, the slowing pace of expenditure growth and continued commitment to restore fiscal balance, along with the province's large and diversified economy, give us comfort that Quebec can minimize the deterioration in its public finances. 'Despite the near term deterioration, the province remains committed to restoring fiscal balance by 2029-30, consistent with the goal articulated in last year's budget.' In his 2025-2026 budget presented March 25, Quebec Finance Minister Eric Girard forecast a $13.6-billion deficit, a historic record. The budget included an annual increase in spending of only 1.7 per cent but record spending on infrastructure projects as a way to counter the effects of an economic downturn sparked by American trade tariffs. S&P based its downgrade on the increase in government spending, including the infrastructure allocation. DBRS takes note of Quebec's approach but remains optimistic. 'As a result of near-term deterioration in the fiscal outlook and a substantial capital investment program, Quebec has relaxed its debt reduction targets. The province plans to reduce net debt to GDP to 35.5 per cent by 2032-33 and 32.5 per cent by 2037-38 (previously 33 per cent and 30 per cent respectively). The agency adds: 'While the ongoing trade uncertainty is expected to weigh on consumer and business confidence and investment intentions, domestic consumption should remain supported by easing monetary policy along with relatively strong labour markets and household savings.' Legault has said if Quebec is hit with full 25-per-cent tariffs on its trade, the province could lose 100,000 to 160,000 jobs.
Montreal Gazette
27-05-2025
- Business
- Montreal Gazette
‘It's complicated to comply': Quebec's new French signage law carries $30,000-a-day fines
Quebec News By Sweeping new French-language rules take effect in Quebec on June 1, bringing new requirements — and potentially hefty consequences for businesses that don't comply. The updated rules, part of Premier François Legault's push to reinforce the presence of French in public life, could lead to noticeable changes in business signage — and even affect the range of products available to shoppers. Under the changes, companies with names or trademarks in English or another language must add enough French wording so that French occupies twice the visual space of the other language. New rules on product packaging are also coming into effect, as are francization requirements for companies with 25 to 49 employees. To help clarify the rules, The Gazette spoke with Jean-Philippe Mikus, a lawyer with the Fasken law firm, and Michel Rochette, Quebec president of the Retail Council of Canada. French Language Minister Jean-François Roberge declined an interview request. What is the new sign rule? As of June 1, any non-French company name or trademark used on public signs visible from outside business premises must be accompanied by 'markedly predominant' French words. Even partial non-French words can be targeted, such as 'soft' in a software company's name, Mikus said. The law covers exterior signage, interior signs visible from outside and any displays viewable from public areas within office buildings and shopping malls. What types of French terms can be added? The French can be in the form of a word, a description or a slogan. 'You could put in a description of the types of products you sell, you could have signage that discusses other aspects of your business,' Mikus said. But not all French words 'contribute to ensuring the marked predominance of French,' according to the Office québécois de la langue française (OQLF), the province's language watchdog. For example, a sign showing business hours doesn't count. Neither do articles such as le, la, les, un, une, des and du. The OQLF offers the example of a hypothetical butcher shop called Boucherie Best Beef. To comply with the law, the owners have several options. They could install a 'Boucherie' sign twice as big as the name, above Best Beef. They could add 'Saveur et fraîcheur' immediately under their current sign. Or they could place the words 'Charcuterie' and 'Traiteur' above the windows and door. How does Quebec define 'markedly predominant'? French 'must have a much greater visual impact compared to the other languages,' the OQLF says. That means French must 'occupy a space at least twice as large' as the text in another language. 'Basically, you have to take a tape measure and calculate the space,' Mikus said. Then, you either add French words or remove English ones to ensure the correct proportion. The OQLF says the French words must 'have a permanent character and visibility and readability at least equivalent to those of any text in another language.' The French must also 'be designed, lit and located in such a way as to allow them to be read at all times, easily and simultaneously.' As Mikus puts it: 'You can't comply by taking a bedsheet, spray-painting something in French on it and attaching it to the front of your store.' The French must also be in the same visual field as the other language. That means the French 'must be in the same overall view where all the components of the public display are visible and readable at the same time without it being necessary to move,' the OQLF says. The rules are highly detailed to close potential loopholes. For example, with electronic 'dynamic displays' — where messages scroll or alternate — the OQLF says the French text must remain visible at least twice as long as any other language to have the dominant visual impact required. What are the potential penalties? Several major chains in Montreal do not appear to have updated their signs to meet the new requirements. Officials at the retailers did not respond to Gazette requests for comment. They could face stiff fines. The OQLF normally investigates after receiving a complaint from the public, with anonymous ones now permitted because of a change brought in by the Coalition Avenir Québec government. Once the OQLF receives a complaint, it alerts the company, asking it to comply with the law. Failure to do so could result in fines of $3,000 to $30,000 per day for organizations. Amounts are doubled or tripled for subsequent offences. What issues are adding complexity to the rollout? 'It's complicated to comply,' Rochette said. 'We've tried to explain to the government that it's not just a question of willingness — it's also about obtaining authorization from cities and landlords.' A business may need a municipal permit or permission from a landlord to change signage, and it may want to check with the OQLF to ensure its plan complies. 'That can take really long because in some cases we're talking about hundreds of stores that are all different and in cities that might have different regulations regarding signage,' Rochette said. In addition, some municipalities have rules regarding the amount of signage allowed, meaning some businesses will have to reduce the size of their trademarked names before adding French words. Some stores may also have multiple signs — some outside a mall and others on the storefront in the mall. How long have companies had to comply? The change was part of a wave of reforms introduced by the Legault government in 2022 with the enactment of Bill 96, a significant overhaul of the Charter of the French Language, commonly known as Bill 101. However, some details regarding commercial signs were only announced in June 2022. 'Retailers have only had a few months to comply with a big scope of change,' Rochette said. In an emailed response to questions from The Gazette, Roberge's office dismissed that complaint. 'The concept of clear predominance ... has been in effect since 1993 for public signage and commercial advertising, with the exception of trademarks and company names in a language other than French,' a spokesperson said. When Bill 96 was passed, businesses knew 'the requirement for the clear predominance of French would also apply to the display of trademarks and company names (as of June 1, 2025). The regulation published on June 26, 2024 provided clarifications and defines certain concepts, but the requirements were already known.' However, Roberge's version of events contradicts what the OQLF told The Gazette in 2023 when the newspaper reported on a Notre-Dame-de-Grâce pub owner who was told his sign contravened language rules. At the time, the OQLF was asked whether the French descriptor that the pub was going to add to its sign would, as of June 1, 2025, have to be twice as big as the name of the pub. In her response, an OQLF spokesperson said Quebec had not yet defined 'the notion of 'clear predominance'' in the context of trademark signs. What are some misconceptions about the sign rules? English isn't the only target. Even a company that, say, decided to include a Spanish word in its name to sound exotic, for example, must also change its signage to make French twice as prominent, Mikus said. Historic names are not exempt. 'There's no grandfathering of existing signage or existing businesses, so it applies to any business, even if it was your great, great, great, great grandfather who started the company in the 18th century,' he said. It's not only about big companies. 'Even very, very small businesses are affected,' Mikus said. 'It could be your local hairdresser or laundromat.' The new rules go beyond retailers. 'It's any business — it could be an industrial establishment, it could be a commercial establishment, it could be an office building,' he said. How much does it cost to change signs? Roberge once estimated the total cost for Quebec retailers to comply would range from $7 million to $15 million. That estimate is unrealistically low, retailers say. Rochette said a single chain with many stores could end up spending $15 million to $20 million. What can companies do if they can't comply by June 1? Businesspeople who have not considered the issue should immediately assess their signage, Mikus said. 'If they're not able to comply by June 1, they should at least have a plan,' he said. 'That way, if there's a complaint and the OQLF sends a demand letter, they can say, 'Look, we're in the process of doing this — we placed an order with a signage company. Here's what we're planning to do.'' Generally, 'when you show the OQLF you're co-operating in the process, they won't necessarily impose a fine immediately,' Mikus said. If a company receives an OQLF letter, 'before having a knee-jerk reaction and responding with an email and saying all sorts of things, it might be wise to consult a lawyer, given the level of fines,' he added. 'Just to figure out: Am I saying the right things?' He said an ill-considered email could harm a company's case in court. 'Basically, you might be making yourself toast just by sending a letter out,' Mikus said. What are the new packaging rules? As of June 1, if the registered trademark on packaging includes generic or descriptive words in a language other than French, these components must be translated into French on the package. Under the previous rule, when a brand was protected by a trademark, such a translation was not mandatory. Rochette said the change will hurt Quebec retailers such as music stores, hobby shops and hunting and fishing outfitters. These businesses sell imported, specialized products that often come in English-only packaging. Manufacturers are unlikely to translate labels solely for the small Quebec market, he noted. The rules could lead some stores to stop selling items to avoid potential fines, leading customers to foreign online retailers that are difficult to regulate, Rochette said. What are the new rules regarding companies with 25 to 49 employees? Quebec has long required companies with 50 or more employees to undergo a francization process. As of June 1, that obligation will extend to companies with 25 to 49 employees. These companies must register with the OQLF and then assess the use of French in their operations and communications, and submit findings to the OQLF. If the OQLF determines that the use of French is not widespread, it will notify the company that it must 'develop and implement a francization plan.' The plan is meant to ensure that French becomes the main language of work, communication, documentation and internal operations as spelled out in Bill 101. Failing to comply with the francization process can cost a company. Businesses seeking provincial grants, public contracts or bidding on government tenders must provide proof from the OQLF that they comply with the francization process.
