Balking at CETA for the wrong reasons

June 3, 2013

By Dave Coles, originally published at

It’s good that CETA negotiations have stalled. But the cause of the most recent impasse is a damning comment on the Harper government’s thinking.

To conclude the Canada-Europe Comprehensive Economic and Trade Agreement negotiations the Conservatives have been willing to undercut municipalities’ right to “buy local”, grant foreign investors special rights to sue governments and significantly increase drug costs — but they are drawing the line on human rights commitments. According to this week’s issue of Embassy, a significant stumbling block to finalizing CETA negotiations with the European Union is a political text that commits both sides to basic human rights standards.

Running parallel to CETA, the Canada-EU Strategic Partnership Agreement has been in negotiation since 2011. The EU has requested similar political accords with the other countries they have ‘free’ trade deals with. The first article of the agreement the EU recently signed with both Colombia and Peru states: “Respect for democratic principles and fundamental human rights, as laid down in the Universal Declaration of Human Rights, and for the principle of the rule of law, underpins the internal and international policies of the Parties. Respect for these principles constitutes an essential element of this Agreement.”

In the Canada-EU Strategic Partnership Agreement the sticking point is a clause giving either side the ability to suspend CETA if the other side engages in serious human rights violations. Ottawa says it’s concerned that this provision could be abused in a trade dispute and that tying an economic accord to human rights commitments unduly impinges upon this country’s sovereignty.

It’s good to be cautious when agreeing to measures that circumscribe Canadian sovereignty — but to draw the line on a human rights accord is baffling. The Conservatives, for instance, have already negotiated away municipalities’ ability to pursue “buy local” or “buy Canadian” policies. In March the UN released a report examining Canadian poverty reduction measures that suggested these efforts may be “undermined by the Comprehensive Economic and Trade Agreement with the European Union, currently in draft form, which would prohibit municipal governments from using procurement of goods and services valued over $340,000 in a way that favours local or Canadian goods, services or labour.”
As such, dozens of municipalities from Nanaimo to Toronto have asked to be excluded from CETA provisions, something the Conservatives have thus far ignored.

In addition to tying the hands of municipalities, CETA’s investor-state dispute settlement process encroaches on provincial and federal governments’ ability to protect the environment and the public interest. The accord creates a parallel legal system under which European corporations can sue Canada for measures they see as unfairly undercutting their profits.

According to negotiation documents leaked two months ago, the EU wants Ottawa to give its financial institutions the right to sue over measures designed to protect the country’s banking sector. This would weaken the regulatory environment and increase the likelihood of Canada’s financial system imploding, European-style.

Another way in which CETA encroaches on domestic policy is by strengthening Canadian patent protections so they more closely reflect EU standards. A boon for Europe’s large brand-name pharmaceutical industry, stronger patent protections will hurt Canadian generic drug manufacturers and drive up public and private health costs. According to the government’s own figures, the proposed patent changes will increase Canadian pharmaceutical costs by between $367 million and $903 million a year, while an independent study suggests the costs could top $2 billion.
The government’s position on CETA seems to be that moves benefiting multinational corporations are good policy but nominal human rights commitments are cumbersome, or even a threat. What does this say about the Conservatives’ priorities?

Dave Coles is president of the Communications, Energy and Paperworkers Union of Canada.