Canada most sued nation under NAFTA

OTTAWA When it comes to the North American Free Trade Agreement, Canada can safely claim the title of biggest loser in terms of lawsuits.

Since the agreement came into force in 1994, Canada has been sued 39 times by foreign companies claiming Canadian policies have violated their rights under NAFTA.

That is almost half the 84 challenges against all three nations under the investor state provisions.

Canada has lost or settled eight cases and paid more than $215 million in compensation, while the United States has still not lost a single case or paid out a single dollar in compensation.

About 60 per cent of the challenges aimed at Canada have targeted environmental regulations or resource management policies, including provincial regulations on oil and gas development and wind farms, forest and water

The latest statistics were compiled by Scott Sinclair, a senior research fellow with the Canadian Centre for Policy Alternatives.

Sinclair says NAFTA disputes could put a chilling effect on Canadian policy making, particularly in areas of environmental regulation and natural resources.

Canada’s status as the most sued NAFTA country has to be considered a significant topic of discussion when it begins renegotiating the pact in August, he said.

“I think there is a strong case based on the evidence that we have been the losers more often than not,” he said.

Canada, the U.S. and Mexico are expected begin a renegotiation of NAFTA in mid-August.

David Gantz, an international trade law professor at the University of Arizona and former tribunal member hearing NAFTA challenges, said there is no easy explanation for the fact Canada has been the target of more challenges or that the U.S. hasn’t lost any yet.