It’s time to get rid of Chapter 11

Canadian taxpayers poised to pay an American company whopping $570,000,000

Thanks to NAFTA’s Chapter 11, which gives investors the right to sue governments if they believe a public policy or regulation is interfering with their profit-making, Canadian taxpayers are poised to pay an American company a whopping $570,000,000.

That’s because last week, Canada lost its appeal to the Federal Court to overturn a decision by a NAFTA tribunal that the Delaware-based company, Bilcon, was treated unfairly when its application for the expansion of a quarry and marine terminal in Digby Neck was rejected by a joint Nova Scotia–Canada environmental assessment panel in 2007.

$570 million is what Bilcon estimates it would have made in profits in the years since it was denied the right to proceed with the quarry.

It’s a theoretical amount; it doesn’t represent the company’s actual losses. But $570 million could — in theory of course — help pay for any number of programs that would improve the lives of real people; families who struggle to find affordable childcare or pay for prescription medications, for example.

And this isn’t the first time we’ll have had to pay out the big bucks. Canada is the most sued country under the ISDS provisions in NAFTA. We’ve paid out millions of dollars since the agreement was first signed 25 years ago.

All that money has gone to international corporations that successfully argued against policies that were put in place to protect the people of Canada and our environment.

It is ironic that in the current negotiations the United States — the country that has lost no cases — is asking for Chapter 11 to be made optional, while Canada continues to defend it.

It is outrageous that when it disagreed with the outcome of the environmental assessment, Bilcon was able to bypass the Canadian court system and have its case heard by a NAFTA tribunal. It is the first time an environmental assessment has been challenged in this way, and it sets a dangerous precedent.

The environmental assessment, which was carried out in accordance with Canadian and Nova Scotia environmental law, found that the proposed quarry development would have significant adverse effects on the surrounding communities.

Bilcon argued, successfully, that “core community values” should not have been considered in the assessment. Despite the fact that community core values and the socioeconomic impact of projects are legitimate considerations in environmental assessment processes. Essentially, Bilcon argued and the tribunal agreed, that the voice of the community need not be heard when projects are being evaluated for their potential impacts.

Trade agreements should uphold environmental laws, not override them. Trade Justice P.E.I. is among over 50 Canadian organizations that last week signed a letter asking Canada to engage in a new model of international trade agreements, one based on enforceable environmental standards. We are also calling for transparent and democratic negotiations; strong and enforceable labour rights, including for migrant workers; protection of public services; and the right to regulate in the public’s interest.

While Canadian provinces and territories may not be at the table in the current renegotiation of NAFTA, they are in the next room. Islanders have heard little from our own representative. The Investor State Dispute Mechanism (ISDM) is bad for the environment and bad for democracy, and it should be removed from NAFTA.

The MacLauchlan government should be more transparent to Islanders on what these negotiations mean for Islanders. NAFTA’s investor rights have been described as “a corporate dream, a citizen nightmare”.

We should expect greater transparency and openness and not be locked into another corporate bill of rights which overrides the interests of the citizens of Canada.