FDFA is urging Canadian officials to address a crisis threatening land border duty-free shops as cross-border travel drops by more than 40% year-over-year. The Frontier Duty Free Association represents 31 stores along the U.S. border, where sales are treated as exports. Barbara Barrett, the group’s executive director, said the decline has pushed businesses “under severe stress” and created an unfair regulatory imbalance with U.S. competitors.
Travelers have fallen by over 40% in some corridors, according to FDFA estimates. Stores in smaller, remote areas have been hit hardest. “Our stores are designed to keep Canadian dollars in Canada, but some have already closed,” said Tania Lee, president of Blue Water Bridge Duty Free. “Others are just holding on.” The group argues the drop in visitors is temporary but the policy challenges are not.
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Barbara Barrett emphasized that duty-free shops have operated for over 40 years, competing directly with U.S. businesses. “This drop in travel is real, but it is not permanent,” she said. “The issue is the policy imbalance that is making it harder for Canadian operators to compete.” The FDFA says its members need adjustments to level the playing field without costing the government anything.
Land border shops are federally licensed and sell only to travelers leaving Canada. They capture spending that would otherwise go to U.S. retailers. The decline has shifted economic activity away from Canada, even as some travel corridors begin to recover. “If it is not addressed, the loss of sales will continue,” Lee added.
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The FDFA’s appeal comes as border communities face uncertain futures. Stores are struggling to stay afloat, with some already shuttered. The group says the current situation is a “moment in time” but warns that without changes, the economic impact will persist. “What we are asking does not cost the government anything,” Lee said. “We want adjustments that make us more competitive with the U.S.”
Barbara Barrett called for targeted regulatory action to support duty-free shop owners. The FDFA says its members are not seeking handouts but a fairer framework to survive. “These businesses have operated successfully for more than 40 years,” she said. “They were built to compete directly with the United States.”
The drop in cross-border travel has disrupted border economies, with sales collapsing in key areas. Smaller shops, often the backbone of local commerce, are struggling. “The issue is the policy imbalance,” Barrett said. “If we don’t fix it, the loss of sales and economic activity will continue to shift outside of Canada.”
The FDFA’s request focuses on regulatory changes to help Canadian duty-free shops match U.S. competition. “We want adjustments that make us more competitive,” Lee said. The group says its appeal is not about subsidies but about creating a level playing field. “The current environment is a moment in time,” she added. “But the imbalance is ongoing.”