Trying to fax overseas from Canada and transmission goes straight to standby and gives error E2) or busy.

Sending a fax to another county is easy - almost as easy as sending a fax to someone in your own country. The only difference is the phone number that you'll dial.
When sending a fax from one U.S. city to another, you dial a 1, then the area code, then the seven-digit phone number. When sending a fax from the U.S. to another country, you usually dial 011, then the country code, then a city code (which is like an area code), then the phone number. (The phone number isn't necessarily seven digits.) Check out the web site www.HowToCall.info, which will give you the specific country and city codes for the place that you're trying to send a fax to.
Other than figuring out the phone number, faxing internationally is identical to faxing domestically. Fax machines in other countries use the same protocols as ones in the United States, so you should have no difficulty communicating with a foreign fax machine. Older fax machines and noisy overseas phone lines may cause the transmission to take a bit longer than you're used to, but it should get there.
The first time you send a fax to another country, it might be a good idea to listen in as the fax machine dials. On some fax machines, you can press the "Dial" button to hear the dial tone, and dial the number manually. Listen for the ring and fax tone, then press the Start button to send the fax. You might want to do this the first time you send a fax overseas, just to make sure it's working as expected.

try using seperators/pause break between the no. if the Fax is to be sent overseas,

The manual for your fax machine can be downloaded from this link

http://www.devicemanuals.com/guide/Telephone%20and%20Fax/Panasonic/Panasonic-KXF1050-FAX-TkRZeE9RPT.html

Has it always done this, or did Fax once work? Sadly, Windows XP Fax has many shortcomings, not the least of which is that it won't work with many modems still in common use. Modem incompatibility is not apparent during installation or the initial setup. It only becomes apparent when you try to send or receive a fax. The Fax Service will dial or will answer an incoming fax but then fail with any of a number of unhelpful error messages such as "Line is busy," "There is no answer," or "Reception error." There will be nothing in Event Viewer to give a clue as to where the problem might lie.

These errors have been nearly impossible to track down. To do so requires enabling both PSS and debug logging of fax transmissions, both of which require fairly extensive registry changes. For the time being, the best advice is to attempt to use XP Fax only if you have a modem that is listed on the Windows XP Hardware Compatibility List and using the latest drivers.

Hope helps.

This is an error message you get because of poor line conditions, this is common when sending overseas.

Please follow the directions below for sending overseas.

Press (Fax). Load your document.
Press up or down arrows to choose
Overseas Mode.
Press OK.
Press up or down arrows to choose On (or Off).
Press OK.

then dial number and press start.

If you are having difficulty sending a fax overseas due to possible
interference on the phone line, we recommend that you turn on the
Overseas Mode. After you send a fax using this feature, the feature
will turn itself off.
1 If it is not illuminated in green, press (Fax).
2 Load your document.
3 Press Menu/Set, 2, 2, 7.
4 Press ▲ or ▼ to select On (or Off).
Press Menu/Set.

Your manual gives this information also on page 3-13

Good Luck

To eliminate a machine problem, make a copy of something; you are using the scanner to verify if the mechanics are OK.

To eliminate a phone line problem, take the fax to another house or office and try there it again.

Try calling your fax machine with a cell phone to see if the fax answers. If not, check that the phone wire to the fax is plugged into the LINE socket, NOT THE PHONE SOCKET on the fax machine. Next, go to the MENU on the fax.You may have to check or change one or more of the following settings by trial-and error to fix the problem. BEFORE YOU CHANGE ANY SETTING, WRITE DOWN OR PRINT OUT THE ORIGINAL SETTINGS. In the MENU, find FAX SETTINGS, FAX SET-UP, or INITIAL SETUP settings. Try changing one or more of the following: PULSE/TONE, RECEIVE MODE, SEND MODE, RING DELAY, RING TIME, OVERSEAS MODE, etc.

I can give you a general answer. If the other fax machine is an older model, it probably has a slower baud rate. You probably have an option to slow your machine down. It goes thru a process to setup a tx speed, if it is not satisfied with the clarity of the line, it will timeout, hence your error. I would slow it down in increments until you get a reliable connection. If it only happens to one place, there is a possibility of a compatibility problem, which also can be solved, but would require service modes to do.

set baud rate to 9600 or slow
set resolution to standard
set error correction mode (ECM) off
.
.
if fax has overseas mode turn it on

vonage can make changes to the line that could help, if your using a voice line with call waiting use *70 prior to the number to disable call waiting for that call

When the last page of your document has been sent successfully, the machine beeps and returns to Standby mode. When something goes wrong while sending your fax, an error message appears on the display. If you receive an error message, press Stop/Clear to clear the message and try to send the document again. You can set your machine to print a confirmation report automatically each time sending a fax is completed. If you get the error message write it down it should always supply an error message if the fax did not go through.