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Digby Neck quarry NAFTA challenge goes to court in 2017

Photo by Russell Monk.

A court case relating to the Digby Neck quarry NAFTA investor-state dispute settlement (ISDS) challenge will be heard in early 2017.

The case is significant because it will deal with the question of whether a Canadian court or a NAFTA tribunal is the appropriate forum for corporations to challenge environmental assessment decisions.

In March 2015, The Globe and Mail reported, “A NAFTA arbitration panel has ruled against Canada in a claim by a U.S. company that wanted to develop a quarry in Nova Scotia, although a dissenting member of the panel warned that the decision will be seen as a ‘remarkable step backwards’ in environmental protection. Bilcon proposed the expansion of a quarry near Digby on the shore of the Bay of Fundy in September, 2002, but the Nova Scotia and federal governments rejected it after a joint review panel recommended it not proceed. The family-owned company – which is registered in Delaware – will now seek [$130 million] in damages after the arbitration panel declared that it was denied a fair environmental hearing.”

That article adds, “The Bilcon decision has raised a number of concerns about the investor-state dispute settlement provisions that are commonplace in international agreements, ranging from the North American free-trade agreement, to the Canada-China foreign investment agreement, to the proposed Trans-Pacific Partnership.”

This past June, CBC reported, “While the company seeks compensatory damages, the federal government has applied to the Federal Court of Canada to set aside the ruling on the grounds the panel exceeded its jurisdiction. [Despite the federal government’s support for ISDS provisions in ‘free trade’ deals] it says a Canadian court — not a NAFTA tribunal — is where the company must turn if it objects to a decision made by a Canadian environmental assessment. …[But] Bilcon has applied to the Federal Court of Canada to put the judicial review on hold until the arbitration panel decides how much Canada owes the company.”

The stay hearing was held on June 22 in Toronto.

This past August, Halifax-based Council of Canadians organizer Robin Tress met with Anne-Marie Mineur, Member of European Parliament from the Netherlands, at a meeting in Sandy Cove to update community members on this issue. Tress writes, “She is in the thick of [the ratification process for the] Canada-European Union Comprehensive Economic and Trade Agreement (CETA) and United States-European Union Transatlantic Trade and Investment Partnership (TTIP) negotiations in Europe, and doesn’t have much experience in dealing with damaging international trade deals and the investor state clause so famous for making NAFTA a terrible deal for communities like Sandy Cove.”

This case should serve as a warning for Europeans politicians who are on the verge of approving CETA.

And now a September 20 media release notes, “The Sierra Club Canada Foundation and East Coast Environmental Law and their legal council at EcoJustice are applauding the recent decision to proceed with a federal court process to determine if the decision to reject the Digby Quarry was in line with our obligations under NAFTA. …The good news is that the Federal Court of Canada decided has denied Bilcon’s application. This means that the company will not receive compensation before the Canadian court has had its chance to make their ruling.”

That court case is now expected to be heard in Spring 2017.