Adjournment Proceedings – International Trade

Elizabeth May: Mr. Speaker, I rise tonight to pursue a question that I asked in the House last week, punctuated by two events. Tomorrow we experience the 25th anniversary of the devastating assault, the organized crackdown by the People’s Republic of China Communist Party. I can remember watching on television as the Statue of Liberty was built in Tiananmen Square. We felt that perhaps the Communist government in China was on the verge of a Chinese version of what we had just seen sweep through the former USSR, glasnost and perestroika. There was a hope that China was on the verge of a breakthrough in democracy. Instead we witnessed one of the most brutal crackdowns and saw innocents slaughtered in Tiananmen Square.

It struck me with some irony that we were five days away, at the time of Tiananmen Square, from a really brave effort for democracy by a Vancouver Island first nation, the Hupacasath First Nation of 300 souls. They are located not far from Port Alberni, and they have chosen to go to the Court of Appeal to oppose a very dangerous—and I use the word “dangerous” advisedly—investment agreement with the People’s Republic of China. It is a FIPA, a foreign investment protection agreement, that will give the People’s Republic of China rights to challenge Canadian law superior to those rights held by Canadian domestic corporations.

The agreement will apply to the state-owned enterprises of the People’s Republic of China, whether they be Sino-Paper or Sinopec or CNOOC or PetroChina or any other, and not just the oil and gas sector. Any investors from the People’s Republic of China in Canada represent tentacles of the government in Beijing, with boards of directors appointed by the Communist Party and the Politburo of the People’s Republic of China.

This is not merely a statement about the unique characteristics of the People’s Republic of China. The Green Party is the only party that actually opposes the concept of investor state agreements. We do so because, for the first time, trade agreements are being used as a way of diminishing democracy. One of the best trade lawyers in Canada, Steve Schreibman, describes these agreements as “fundamentally corrosive of democracy” and says that they give foreign corporations the right to oppose and to seek arbitrations around any decision, whether at the municipal level, the provincial level, or the federal level, that is seen by these corporations as imperilling their expectation of profit.

In that sense, it is particularly egregious to allow an antidemocratic government to challenge the decisions of a democratic government. The Canada-China investment treaty is different in quality from, say, NAFTA’s chapter 11 in that its enterprises are completely part and parcel of a much larger economy and a government that itself is antidemocratic.

The other very egregious thing about this agreement is that the lock-in, if it were ever ratified, would apply for 31 years, and no future government could get out of it without the permission of the People’s Republic of China.

I ask my hon. colleague if it is not time to agree that this agreement should be scrapped.

Lois Brown: Mr. Speaker, deepening Canada’s trade and investment ties with the largest, most dynamic, and fastest growing markets in the world, such as China, is a central feature of the government’s pro-trade plan for creating jobs, growth, and long-term prosperity.

By improving access to foreign markets for Canadian businesses, this government is supporting economic growth and creating new opportunities for Canadian companies and investors.

The Canada-China foreign investment promotion and protection agreement is a high-standard agreement and a tangible demonstration of our commitment to help Canadian businesses compete on a level playing field in markets abroad.

In terms of its commitments, this agreement includes reciprocal obligations related to non-discrimination, a minimum standard of treatment under international law, expropriation, free movement of capital, and performance requirements, among others.

This agreement with China is very similar to the 27 FIPAs Canada currently has in force.

This reciprocal agreement establishes a clear set of rules under which investments are made and under which investment disputes are resolved.

Here are some highlights of this agreement.

For Canadian businesses looking to set up in China, they cannot be treated less favourably than any other foreign company looking to do the same. Once an investment is made, a Canadian business cannot be treated less favourably than any other business, including Chinese businesses.

The agreement also protects investors against government expropriation except under strict conditions, and then only with fair compensation.

The foreign investment promotion and protection agreement also ensures that all investment disputes arising from breaches of the agreed rules are resolved under international arbitration, ensuring that adjudications are independent and fair.

Finally, ours is the first bilateral investment agreement that China has signed that expressly includes language on transparency of dispute settlement proceedings. It is Canada’s long-standing policy that all dispute resolutions should be open to the public and that the submissions made by the parties be available to the public.

This agreement does not impair Canada’s ability to regulate and legislate in areas such as the environment, culture, safety, health, and conservation.

Furthermore, restrictions in the agreement will preserve Canada’s current ability to review foreign investments under the Investment Canada Act to ensure they provide a net benefit to Canadians and that our national security is not compromised.

It is also important to note that, under this treaty, Chinese investors in Canada must obey all of the laws and regulations of Canada, just as any Canadian must.

In short, the Canada-China foreign investment promotion and protection agreement is similar to the 27 other investment treaties Canada has implemented with key trade and investment partners.

We join countries such as New Zealand, Germany, the Netherlands, Belgium, and Japan, who have all signed investment treaties with China on terms that are similar to and in some cases less favourable than the terms we have negotiated with China.

Furthermore, our government has brought greater transparency to the treaty review process. For example, in 2008, we introduced a formal tabling policy that requires international treaties to be tabled in the House before their ratification or coming into force.

The tabling period is 21 days, during which MPs and the public have an opportunity to review the treaty. In line with this policy, MPs had an opportunity to carefully review the treaty when the Canada-China FIPA was tabled in the House of Commons on September 26, 2012.

We have been very clear with the Chinese government that Canada wants to continue to expand its commercial relationship with China, but only in a way that produces clear benefits for both sides.

By establishing a clear set of investment rules that provide greater protection against discriminatory and arbitrary practices, this agreement will give Canadians greater confidence as they consider whether or not to invest in China.

Elizabeth May: Mr. Speaker, these are the pieces, in the short time I have, that I will pull out of her remarks.

It is really important that people understand the difference between being against investment with China, trade with China and opposition to this treaty.

It is very important to stress that the Government of Australia, for example, with a volume of trade with China more than 10 times that that Canada currently has, has made a deliberate decision not to enter into an investor-state agreement with the People’s Republic of China. It is important to understand, therefore, that this kind of an agreement is not a sine qua non. The government cannot insist that we must have trade with China and therefore we need an investment treaty. That is not the case.

That is why it is critical that we say no to ratifying a treaty. We had 21 sitting days in this place, but we never had a single day of a committee hearing. We did not investigate it. We absolutely must not ratify it.

Lois Brown: Mr. Speaker, on October 18, 2012, the House of Commons Standing Committee on International Trade received a presentation from trade policy officials on the Canada-China FIPA. The FIPA was also discussed and voted on in Parliament during the proceedings of an opposition day motion of April 18, 2013.

The Canada-China foreign investment promotion and protection agreement will contribute to jobs and growth by facilitating investment flows between Canada and China, and by providing a more stable and secure environment for investors on both sides of the Pacific. The reciprocal rules that form the basis of these agreements establish a framework providing investors with a predictable rules-based investment climate and access to international arbitration provides an effective binding and impartial method for the resolution of investment disputes.

As is Canada’s practice, the provisions and procedures for investor-to-state dispute settlement are clearly laid out and emphasize transparency through elements such as public access to hearings and documents.

This agreement with China, the world’s second-largest economy, will provide a stronger protection for Canadians investing in China.