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Courting TILMA: U.S. investors eye Alberta and B.C.’s interprovincial trade agreement

by Stuart Trew

Policy harmonization and investor rights are the goals of all free trade agreements. They were a main component of NAFTA and are acquiring new urgency within the Security and Prosperity Partnership of North America (SPP). They are also at the heart of the Alberta-B.C. Trade, Investment and Labour Mobility Agreement (TILMA), which will go into effect on April 1, 2007.

TILMA creates a legally binding process by which corporations and individuals can challenge

  • government programs and regulations if they “restrict or impair” investment;
  • regulations in one province that are different from those in another;
  • the establishment of new, stricter regulations;
  • initiatives by one province with which the other province does not agree.

TILMA does not fully apply to existing local government policies until after a two-year transition period, but as soon as the agreement comes into force, new government initiatives will be challengeable by lawsuits if a company or private individual feels they restrict their trade or investment. Since all local government regulations in some way restrict investment, everything will be up for grabs. Government “entities” covered by TILMA, and therefore vulnerable to private lawsuits, include regional, local, district or other forms of municipal government as well as school boards.

Changing the rules

So far, Alberta and B.C. are the only two signatories, but TILMA has a far wider fan club, with Ontario and Saskatchewan suggesting they are about to sign on, and certain U.S. states drooling at the possibility.

At the most recent meeting of the Pacific Northwest Economic Region (PNWER), a bi-national association of Canadian and American businesses with heavy involvement from the oil and gas sector, representatives from north-western U.S. states alongside B.C. and Alberta officials committed to explore the possibility of “expanding the TILMA concept throughout the PNWER region.”

The U.S. Trade Representative frequently complains about the Canadian Wheat Board and other agricultural policies. Entry to TILMA would give U.S. companies the legal means to dismantle or rewrite these policies, as well as any other provincial or municipal government rules they didn’t like.

Like these U.S. states, Industry Minister Maxime Bernier is clearly enamoured with TILMA. “The Alberta-B.C. agreement is a very good one,” he told a Senate committee looking into interprovincial trade barriers. “I hope that the other provinces will jump in. That will help us to improve the Agreement on [Internal] Trade at a federal level.” The AIT had been trying to create a national TILMA-like agreement since 1995, but had little success until B.C. and Alberta’s free trade pact rejuvenated the discussion.

Unfortunately, a larger, national legal framework for TILMA, with U.S. participation, would give U.S. companies the same rights as Canadians to sue local governments, formalizing a process of policy harmonization and deep integration that so far has no legal backing. Such an arrangement would require Canadian and U.S. regulations on everything, including health care and the environment, to be harmonized throughout the free-trade area, hastening a process of deep integration with the U.S. that Canadians have not had a chance to debate in public or in the House of Commons.

Dangerous consequences

So why did Alberta and B.C. sign an agreement that radically shifts the balance of power in favour of corporate interests and that could ultimately legalize a process of deep integration with the U.S.? And why did they sign it without even consulting with the public or elected representatives first? These are questions that demand answers before TILMA goes into effect this April. The consequences to public health and the environment, and the danger that TILMA will lead us quickly toward economic integration with the United States, are severe. Let’s not let this agreement pass without a fight.

For more information about TILMA, including research, action tools and upcoming events, please visit our website at www.canadians.org/DI/issues/TILMA/.

Stuart Trew is a Communications Administrator for The Council of Canadians.

INTEGRATE THIS! Challenging the Security and Prosperity Partnership of North America

Read more about the Security and Prosperity Partnership of North America (SPP) on our website. Email inquiries@canadians.org or call us at 1-800-387-7177, for more information.

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Integrate This! Challenging the Security and Prosperity Partnership of North America
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The Council of Canadians  
updated March 7, 2007
 
 
 

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March 7, 2007