As he has at the end of each negotiating round of comprehensive free trade talks with the European Union, Canada’s lead negotiator, Steve Verheul, convened a civil society briefing today to go over progress and answer questions about the proposed deal. These are not consultations — there is no room on the calls for feedback from groups like the Council of Canadians, Conference Board of Canada, Canadian Union of Postal Workers, Canadian Conference of the Arts, etc, who have been phoning into the DFAIT conference calls since last October. In fact a list of 18 organizations wrote to Trade Minister Peter Van Loan in February to make sure the government had an official record of complaint about the inadequacy of the negotiating and consultation process on these Canada-Europe free trade talks. But Verheul’s calls are useful nonetheless, and usually very informative. Here’s what we found out today.
According to Verheul, due to the Icelandic volcano stopping trans-Atlantic flights only five of the usual 40 EU negotiators made it to Canada in person in time for the third round of CETA (Comprehensive Economic and Trade Agreement) negotiations, and time differences made tele- and video-conferences difficult. Objectives remained to close as many chapters as possible, park those linked to more controversial issues, and to continue to discuss flexibilities in services, goods, investment and procurement, and how to structure offers in those areas which will come up in the fourth or fifth rounds.
They are getting into more difficult areas so negotiations are slowing a bit. Procurement, for example, is Number 1 priority for the EU, much of it at the provincial and territorial level. The feds will be meeting with provincial negotiating teams in May and June to figure out what the provinces are willing to give up in this area. For a sense of what the EU is asking around procurement, and how it will affect social and economic development policy, see Scott Sinclair’s CCPA report, “Negotiating From Weakness: Canada-EU trade treaty threatens Canadian purchasing policies and public services.”
Agricultural tariffs and regulatory cooperation/standards are difficult areas also, said Verheul on the call today. The former are still in the 10 per cent of sensitive tariff lines that Canada and the EU have yet to negotiate. The latter are stuck, as they have been for years in past EU negotiations with Canada and the United States, on how to bridge fundamentally different regulatory regimes in Europe and North America. You can’t blend a precautionary approach (EU) with a cross-your-fingers-and-hope-nobody-gets-hurt approach (North America). You’d have to arrange some kind of mutual recognition of standards, and based on the leaked CETA text, the EU is not willing to go there. However, Verheul said in the Q+A that genetically modified organisms will come up in future discussions on technical barriers to trade.
Pressure on copyright and intellectual property
The intellectual property negotiating group is falling behind the others, said Verheul, because Canada cannot negotiate seriously until its domestic copyright reform efforts are complete. In the question and answer portion of the call, Michael Geist commented that Korea made a lot of commitments in the areas of broadcasting and copyright irrespective of domestic rules at which point Verheul admitted they have an agreement with EU negotiators to talk about anything but that IP is tricky. On geographic indications, for example, he said Canada still needs to look into it more. The EU enforces the names of products like Vino Verde (a Portuguese wine) centrally while Canada’s trademark system puts it in the hands of producers.
Next steps: The Canada-EU summit, May 5
On top of these five planned negotiating rounds, the third of which will wrap up early next week, Canadian and EU negotiators are discussing regularly. Verheul told us the CETA talks will be a topic of discussion at the next Canada-EU Summit in Brussels on May 5, with leaders generally reviewing the state of negotiations to date. Following that, federal negotiators will tour Sweden, Italy and Poland for one-on-one discussions with individual member states in the same way that the European Union is meeting provincial governments here in Canada and holding public events with local business associations and lobby groups. The next formal round of negotiations is in Brussels, July 12 to 16, followed by a fifth in Ottawa in October. Verheul told us that two more have been planned for next January and April, which could be a sign of how difficult the difficult issues really are.
Sticking points – the Constitution as barrier to trade?
While Canadian and EU negotiators are close to closing chapters on trade remedies, e-commerce, competition policy and regulatory cooperation (likely voluntary, based on the leaked CETA text), there are differences of opinion on Canadian export restrictions on some goods, on what the national treatment wording should look like (my hunch is it involves EU requests at the municipal level), on perceived barriers to inter-provincial trade, and on services and investment. Also, there are sticking points on automobile standards and regulations, on fish (exports from Canada), on dispute settlement, and on technical barriers to trade, as well as on environmental issues (no kidding!). For example, Canadian companies have been pushing for a decade now to weaken EU forest product certification standards which discriminate against Canadian exports based on production methods.
The EU is making one especially sweeping demand — that Canada adopt the same relationship to the provinces as the EU has with its member countries! “We’ve said our constitution is a bit different and that the provinces have exclusive jurisdiction in some areas that they will not give up,” explained Verheul, adding that the EU is requesting uniformity that does not exist but has failed to offer any concrete examples of how provincial differences in rules or regulations create a trade barrier for European companies.
An ‘improved’ investor-state mechanism – Chapter 11 minus the frivolity
Verheul said there is no agreement yet on what the investment chapter should look like in CETA. In December last year, investment became the sole responsibility of the European Parliament and EU Commission where previously member states could sign NAFTA Chapter 11-type investment agreements with third parties, as Canada had done with four Eastern European countries. When questioned about what would be “improved” about the CETA investor-state process as proposed by Canadian negotiators, he said it would work more smoothly and try to avoid “frivolous cases.” Though he didn’t expand on what current Chapter 11 cases might be considered frivolous, I’d like to suggest that most of them fit the definition, especially Dow Agroscience’s lawsuit against Quebec’s pesticide ban and Abitibi-Bowater’s challenge to Newfoundland’s decision to re-appropriate the company’s land and water rights after they vacate the province.
Canadian business and US trade official interest muted
According to Verheul, business interest in Canada in the negotiations is generally supportive but they are not telling Canadian negotiators what their specific problems are with access to the EU. U.S. trade officials are similarly only mildly interested in the CETA talks, he said — curious but not “knocking on our doors to get more intelligence.” This is strange because of the possibility that Canada will grant more investor protections to European companies than exist under NAFTA for American and Mexican companies, which would be illegal under the Most Favoured Nation terms. It would also go some way to creating a NAFTA-EU free trade agreement — a long-term goal of the EU Commission.
Public and civil society interest in CETA building
With the leak last week of the full CETA text by the new Trade Justice Network, Canadians should expect to see more information about and opposition to the Canada-Europe free trade talks. The concept of trade justice encapsulates ideas like that everyone should have a right to decent work and a good wage, that environmental protection is more important than corporate rights to profit, and that the proceeds of economic development should be more evenly redistributed through enhanced social protections and public services. In general, it means that trade, like the economy in general, should serve social and community needs first. As written, the Canada-EU agreement would reshape Canadian and European communities in order to make it easier for corporations on both sides of the Atlantic to make more money. Environmental and social protections get short shrift, as they do in all free trade agreements.
To download a leaked copy of the CETA agreement, as well as fact sheets on some of its more damaging impacts on public services, agriculture, culture, etc, go to www.tradejustice.ca. Get the agreement to your local councillors and members of provincial legislature and ask a few simple questions, such as:
– What’s your opinion of these Canada-EU trade negotiations?
– How will our city/province be affected by the agreement’s bans on local or environmental purchasing policies?
– When do you plan on setting up a town hall meeting to hear from the public about the CETA and its impacts on local public policy?
It doesn’t take much to get the public debate started. As we find out more about the deal and its probable affects on Canada, we’ll be posting it to www.canadians.org.