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Constitutionality of Canada-China investment treaty questioned in First Nations letters to PM, Chinese government

FIPA protestors outside B.C. Premier Christ Clarks office this week (Source: Georgia Straight)

FIPA protestors outside B.C. Premier Christ Clark’s office this week (Source: Straight.com)

The embattled Canada-China Foreign Investment Protection and Promotion Agreement (FIPA) is coming under intense fire from First Nations chiefs and communities this week. The FIPA, which the Harper government will be in a legal position to ratify as of tomorrow (November 2), is being called unconstitutional and a violation of Indigenous rights that both the Union of British Columbia Chiefs, and the Assembly of the First Nations of Quebec and Labrador, “advise and direct the Government of Canada to reject.”

The government “has breached its fiduciary duty to consult First Nations on our respective constitutionally-enshrined and judicially-recognized Aboriginal Title, Rights and Treaty Rights,” says the letter, which claims that the FIPA “provides far superior protection for Chinese investors’ interests than for our First Nations’ Aboriginal Title, Rights and Treaty Rights.

“The agreement prohibits the Government of Canada from offering special treatment to any Canadian investor that it does not offer Chinese investors,” continues the UBCIC. “We believe the agreement would enable Chinese investors to challenge Canadian regulations, policies and/or legislation designed to protect the environment as well as current reconciliation negotiations, accommodation measures and treaty negotiations.”

The Assembly of Manitoba Chiefs, in a letter this week to Chinese Commerce Minister Chen Deming, also expresses concern with a lack of consultation during the FIPA negotiating process. The letter, signed by Derek J. Nepinak, Grand Chief of the AMC, suggests the assurances from the Harper government that Canada will safeguard its ability to maintain existing environmental standards under the FIPA are insufficient after recently passed budget legislation “which changes the scope of how Canada wishes to deal with environmental reviews.”

In a blog post yesterday for West Coast Environmental Law, Executive Director Jessica Clogg and staff lawyer Andrew Gage explain that “By giving new rights to Chinese investors, the treaty risks undermining Canada’s obligations to deal in good faith with First Nations.”

For example, Clogg and Gage cite the Maa-nulth First Nations Final Agreement, which states:

1.7.1 After the Effective Date, before consenting to be bound by a new International Treaty which would give rise to a new International Legal Obligation that may adversely affect a right of a Maa-nulth First Nation Government under this Agreement, Canada will Consult with that Maa-nulth First Nation Government in respect of the International Treaty either separately or through a forum that Canada determines is appropriate.

The lawyers then suggest the multi-million dollar lawsuits that Canada can expect to see from Chinese firms under the FIPA, based on the NAFTA experience, could very well create “a disincentive for the Crown to negotiate honourably with First Nations (for example, regarding environmental and cultural protection measures in treaties or other legal agreements).” If it could be shown that this significantly interferes with First nations outcomes or the negotiating process:

then on the basis of Charter jurisprudence in Canada, a court could hold any legal action taken by Canada to ratify or implement FIPA to be unconstitutional, and it is possible that a First Nation could seek an interim injunction preventing its ratification until they have their day in court. Given the lack of consultation with First Nations on FIPA it is very difficult to see how Canada could justify its infringement of First Nations constitutional rights.

In an article about these First Nations concerns today, The Drum quotes Rudy Hunsy in Trade Minister Ed Fast’s office as claiming there is a carve out in the FIPA for Aboriginal rights.

“The (investment agreement) contains the exceptions found in our other treaties that preserve policy flexibility for certain sensitive sectors and activities, including rights or preferences provided to Aboriginal peoples,” said Hunsy in an emailed statement. “The (investment agreement) … provides a policy carve-out for government measures concerning ‘rights or preferences provided to Aboriginal peoples.'”

But as Clogg and Gage explain:

this reservation does not to apply to Article 10 of FIPA, the expropriation provisions, which create the risk of investor-state suits for compensation, and which are a major source of the potential impacts on First Nations. This reservation does not legally remove the obligation of the Crown to act honourably toward First Nations with respect to the ratification and implementation of FIPA.

The West Coast lawyers suggest that even at this late stage, there is the possibility for concerned First Nations to challenge the FIPA with China, and for that matter similar investment protections in treaties like the Canada-European Union Comprehensive Economic and Trade Agreement, which could be concluded by the end of this year. They write that an injunction to prevent the FIPA ratification “would be far from straightforward, as the courts might view the impacts on a First Nation as speculative.” But still, “a First Nation facing development in their territory by companies with Chinese investors, or one with specific treaty provisions regarding consultation on international treaties might well be able to convince a court to hear the case.”

That kind of injunction would be similar to the one the Council of Canadians has asked B.C. Premier Christy Clark. Maude Barlow, national chairperson of the Council, who has just concluded a multi-city speaking tour to stop pipeline expansion in B.C., said in a press statement that “Given the enormously important decisions B.C. will be asked to make about its energy future, and its constitutional authority over natural resources, Premier Clark has a responsibility to fully study the effect the China investment pact will have on its ability to say no to damaging or unpopular projects, or to strictly enforce labour and environmental standards on those projects.”

Protesters hung a banner outside Clark’s office on October 30 to demand a stop to the China investment treaty. Organizer A.J. Klein called the FIPA “an expansion of corporate power, along with natural-resource extraction.” More than 70,000 people have sent letters to the PM saying about the same. And today, thousands of Canadians participated in a two-hour email blitz to tell the Prime Minister and key Conservatives that they are opposed to these excessive corporate rights treaties.

Though Harper could ignore all this and ratify as early as tomorrow but it will come at a price. Things are not likely to cool down.