Questions raised by China agreement
The Canada-China Agreement for the Promotion and Reciprocal Protection of Investments (FIPPA) raises questions about what impacts it will have on Canadian sovereignty and the rights of provinces.
At first the text of the proposed treaty seems innocuous enough. For example, it says it allows general exceptions from its provisions “for such matters as investments in cultural industries; the protection of human, animal or plant life or health; [and] the conservation of living or non-living exhaustible resources . . . .” It adds that “the Contracting Parties recognize it is inappropriate to encourage investment by waiving, relaxing or otherwise derogating from domestic health, safety or environmental measures.” The text of the proposed agreement also includes a provision that allows Canada to maintain the basic aspects of its foreign investment review process.
On the other hand, the proposed treaty calls for treating companies and enterprises from the People’s Republic of China no differently than any other foreign enterprise operating in Canada or any Canadian company. The document says “each contracting party shall take all necessary measures in order to ensure observance of the provisions of this Agreement by provincial governments.” The agreement is to remain in effect at least 15 years. Then one or the other country must give one year’s notice of any intention to leave the agreement, and even then any Mainland Chinese corporations already operating in Canada will be grandfathered in for a further 15 years.
In addition, the treaty text says that, subject to relevant laws on the subject, “each Contracting Party shall permit natural persons who have citizenship or status of permanent resident of the other Contracting Party and are employed by any employer that is a covered investment of an investor, or a subsidiary or affiliate thereof, to enter and remain temporarily in its territory in a capacity that is managerial, executive, or that requires specialized knowledge.”
Moreover, any dispute over losses to investors attributed to any perceived inappropriate action by either party will, in the event an informal resolution can’t be reached, be referred to a tribunal made up of people outside of the country with no connection to the Canadian court system. “The arbitral tribunal shall determine its own procedure,” the text of the treaty says.
The restrictions on provinces are troubling, as is the provision that Canadian authorities cannot treat any corporation from Mainland China differently from any other foreign-owned or even domestic enterprise. Would an expensive lawsuit arise against B.C., greatly burdening taxpayers, if this province should make a decision to stop the proposed Enbridge pipeline designed to transport bitumen from the Alberta tar sands to a marine terminal in Kitimat for transport by tankers to China? Besides, the environmental protections apparently respected through the treaty are minimal now in view of the fact that recent Conservative Government legislation has already greatly weakened standards for maintaining the health of fisheries and waterways.
Who will determine what personnel are judged to have the specialized knowledge allowing them free entry into Canada to work? HD Mining International has argued that fluency in Mandarin is required to work as a miner at its operation near Tumbler Ridge. Will we see more such arguments from other corporations?