Elizabeth May: Question on CETA

On Thursday, December 1st, 2016 in Adjournment Proceedings, CETA, Issues, Parliament
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Elizabeth May:

Mr. Speaker, it is my honour to rise this evening in adjournment proceedings to pursue a question I asked in question period almost a month ago, on November 2. It relates to the comprehensive economic trade agreement between Europe and Canada and specifically to the thorniest part of that agreement, which has drawn attention around the world, and particularly objections at the last minute from the Walloons, and spreading objections throughout the European Union. It is the investor-state provision.

In my question in question period, I drew a link with a proposal for an open pit mine, within the legal boundaries of the community of Kamloops, called the Ajax mine. I picked that as a particular example because it is very controversial, being within the town limits and right near the school. This is a community that likes mining and has other mines, but it is very concerned about this one.

The reason it ties into CETA is that if CETA did not have investor-state provisions, there would be no particular risk with respect to the fact that the Ajax mine’s proponent is a Polish state-owned enterprise. If CETA goes through and is ratified by Poland and Canada, and should the British Columbia government do the right thing and say no to permitting the Ajax mine to go ahead, that company, being Polish, would have rights that a Canadian mining company would not have. It could sue Canada for damages in an arbitration court for a decision made with no trade motivation whatsoever.

Investor-state provisions are poorly understood in Canada, which is particularly ironic, given that we have been at the losing end of more cases than most countries, because the first investor-state agreement was invented as part of NAFTA. It is chapter 11 of NAFTA.

Canada has been brought for investor disputes and tried at arbitrations that are held in secret. Chapter 11 arbitrations are held entirely in secret, such as the dreadful decision that occurred on a split decision of two arbitrators out of three. Both the federal Conservatives and the provincial Nova Scotia Progressive Conservatives refused the most appalling project I have ever seen in my 17 years working at the Sierra Club, the open pit quarry that was proposed for Digby Neck, Nova Scotia, which threatened the survival of the most endangered whale species on the planet. It was a strong decision based on good environmental assessments. To have that challenged by a proponent from the United States, who was claiming $300 million in damages because it was turned down by John Baird, at the federal level, and by the provincial government in Nova Scotia, was truly outrageous.

That is just one example of chapter 11 of NAFTA. Canada has lost many of these cases and has had our laws overturned in Parliament.

The more we look at this, the more we wonder why we do not better understand the threats of allowing investor arbitrators to make these kinds of decisions.

I quote Juan Fernández-Armesto, a Spanish arbitrator, who was quoted in a report called “Profiting from Injustice”, which states:

…it never ceases to amaze me that sovereign states have agreed to investment arbitration at all…. Three private individuals are entrusted with the power to review, without any restriction or appeal procedure, all actions of the government, all decisions of the courts, and all laws and regulations emanating from parliament.

I have very little time left. This is what I would like the parliamentary secretary to pursue with me. Let us get investor-state provisions out of CETA. They are better procedurally than the ones under chapter 11 of NAFTA, but they are not acceptable.

David Lametti: Parliamentary Secretary to the Minister of International Trade

Mr. Speaker, I thank the hon. member for bringing her unique voice to the House. CETA is clearly in Canada’s national interest and we feel it is time for all of us to rally around it. On top of delivering tangible growth for our economy and opportunities for the middle class, CETA will provide a strong foundation for Canada and the EU to demonstrate leadership on what is truly a progressive accord, a green accord, a health accord, and a labour accord.

It also enshrines the right to regulate. The ICS provisions are something that the trade committee has looked at over the last few sessions. We will continue to work with the committee, and with our European partners as well.

International investment flows are a key driver of economic growth. European investments in Canada create jobs for Canadians and vice versa. These investments also create new trade opportunities where none have existed before. A comprehensive agreement such as CETA cannot ignore this crucial aspect of the economic relationship between Canada and Europe.

CETA establishes a framework for Canada and the EU to build on our already substantial investment ties. CETA’s investment chapter is designed to give investors greater security, stability, certainty, and protection for their investments, and to secure access to each other’s respective markets.

There is no opt-out provision held by any party for any element of CETA, but CETA has been deemed a mixed agreement and, therefore, requires ratification, as a whole, by each individual EU member state for things falling within their jurisdiction. Only after all parties have ratified CETA will the ICS mechanism for the resolution of investment disputes become operational.

While we know that ratification by all 28 EU member states may require some time, we are confident that this will happen. Once ratified by Canada, the EU and all of its member states, CETA will provide Canadian and European investors with a predictable framework based on principles of non-discrimination, fairness, and transparency.

Under CETA, we created a permanent tribunal that is responsible for resolving investment disputes. It is made up of 15 members who are appointed by the European Union and Canada for fixed terms. The creation of this tribunal will make it possible to move away from the existing mechanism, which involves special arbitration tribunals. Hearings and any related documents will be completely accessible to the public. These improvements seek to assure citizens that the decisions rendered by the dispute settlement mechanism are fair and objective.

Nothing in CETA prevents governments from regulating in the public interest to protect or promote public health, social services, public education, or the environment. This principle, which is well recognized in international law, is clearly set out in the CETA text.

These improvements to CETA show our commitment to ensuring that this is a progressive agreement. All Canadians can consult the full, final version of the agreement, which has been available since July 2016, in order to better understand that this is a tremendous achievement in progressive trade policy.

To answer specifically the member’s question relating to the circumstances around the ISDS provisions and application, I would like to quote CETA chief negotiator, Steve Verheul, during his testimony to the House of Commons Standing Committee on International Trade, when he stated, “Given the investment dispute resolution process will not be in place until all member states approve, we will not be able to use that mechanism, and neither will the EU.”

Therefore, in the case of the Polish mine scenario, we need not worry.

Elizabeth May:

Mr. Speaker, I want to ask the parliamentary secretary to return to first principles. The whole idea of an investor-state dispute mechanism is to deal with countries that are relatively lawless, the idea that there might be a day when someone seizes power—indeed, we were debating Cuba all day today—and nationalizes the properties and the businesses placed there by other countries over the years.

This is a large agreement involving all industrialized countries, all bound by the rule of law, with no reasonable prospect of such a thing happening. In the European Union, the reason that so many individual states and regions continue to vociferously oppose this, and why it is being challenged in the European Court of Justice, is that the Europeans have never agreed to such a thing before in the European Parliament.

The question is why on earth do we think we need investor protection when dealing with Germany, France, and other countries that are industrialized and responsible, and not likely to seize our assets? This is ambulance chasing at its worst by a clique of global lawyers, done out of greed

David Lametti:

Mr. Speaker, I would like to point out that the European Union has a number of different bilateral and multilateral trade agreements, and ISDS provisions are a standard feature in all of them.

International investment is a key driver of economic growth. It creates more trade and more jobs. The government negotiated a progressive agreement that enhances economic opportunities while ensuring our ability to regulate in the public interest. CETA will deliver benefits for consumers through lower prices and more choice, for workers through more jobs and better jobs, and for businesses through reduced costs. Our government is committed to ensuring that these important benefits for Canadians are realized as soon as possible.

This is a landmark initiative, ensuring our country’s continued prosperity.

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  • brent1023

    The quarry mentioned by Ms May has features Ms May did not mention.
    First, the company was a Canadian company when it applied for the permit. Failing to get the permit, it incorporated in Delaware then sued under NAFTA.
    That means that NAFTA, and perhaps CETA, is worse than Ms May has suggested because it would appear that any Canadian company could sue, only having to incorporate in the US first. Since Canadian companies far outnumber foreign companies in Canada, this widens and deepens the problems.
    Second, the successful NAFTA case was in part helped by a legal brief written by Murray Rankin. Mr Rankin sits in the house as the member for Victoria as a member of the NDP.
    Perhaps Ms May should ask Mr Ranking about ISDS and its danger to Canada?

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