Skip to content

EU report on CETA recommends modest protections for cities and pared-down investment treaty

Another version of a Sustainability Impact Assessment of the Canada-EU trade deal has emerged, this one with recommendations on where protections might be needed in CETA for municipalities, water, provincial liquor boards, Aboriginal and minority businesses, labour standards and environmental regulations. The report was in the news today because it projects GDP gains from a successful deal that are half what the Harper government has been promising Canadians. Will the EU Commission and Canadian government take the report’s recommendations into account? Hard to say. Would the recommendations give sufficient policy space for job creation, local development and stronger environmental or public health rules? Probably not, but we’re just looking over the thing now. I’ve pulled out some of the more interesting recommendations here.


– “In the GP and Investment chapters, clearly define the rules governing bulk exports of water, particularly allowing unbound flexibility in implementing national water policies that explicitly protect water necessary to support human and ecosystem health and prohibit the export of non-renewable water resources.”


– Consider a sunset clause on investor-state dispute settlement so it expires after five years, and enhance the role of domestic courts to handle disputes rather than the current international system.

– Exclude “essential and basic” public services from dispute settlement, including health care and education

– Give foreign investors rights no greater than those of domestic investors in relation to expropriation, the definition of which should be limited.

– Establish a monitoring group on investment: “If [Investor-State Dispute Settlement] is included in CETA, an ISDS monitoring body/forum should be created. It would be composed of representatives of all governments in the EU and Canada (national level, provinces and territories and municipalities), academics, and civil society. All members would commit to periodic dialogues on the impacts investor-state provisions/ISDS in CETA are having in terms of causing regulatory chill and other reductions on policy space. Reports are required from governments on these issues at least once every 6 months. Participation required from all members. Membership in forum weighted by population of provinces/EU MS. The body could be organised under the auspices of the larger Trade and Sustainable Development Monitoring Body mentioned in C1.”


– Explicitly allow for “Social Considerations in Government Procurement,” including fair wage policies, set criteria for such policies, and monitor it under the Sustainable Development chapter. (Last we heard, this chapter had been split in half by Canada, into separate Environment and Labour chapters, so this might be a moot point.)

– Allow specifically for green procurement in the government procurement chapter and monitor this also, and explicitly allow set-asides for Aboriginal firms in Canada but make it more stringent than the one in NAFTA, and only for “economically disadvantaged” Aboriginals. Also allow set-asides for minority business if they are economically disadvantaged.

– “Include environmental protection provisions in the GP Chapter like that in Note 7 of Canada’s GPA Annex 2 that states ‘Nothing in this Agreement shall be constructed to prevent any provincial or territorial entity from applying restrictions that promote general environmental quality in that province or territory, as long as such restrictions are not disguised as barriers to international trade.'”

– “Do not include a full-stop prohibition on GP offsets for municipalities, but rather include an ‘offset justification provision’ pertaining exclusively to municipalities. The provision would only generally be drafted like Article XVI (2) of the 1994 GPA, which allows offsets for certain policy considerations when “used only for qualification to participate in the procurement process and not as criteria for awarding contracts. Conditions shall be objective and non-discriminatory.””


– Include a Sustanable Development chapter that protects environmental regulations and commits to International Labour Organization standards.

– Have long phase-in periods for tariff reductions so Canadian dairy farmers and European beef farmers aren’t wiped out in one swift blow.

– Leave liquor boards intact for their public health value but remove their ability to favour local products. (This is one of the EU’s more ridiculous asks and it’s strange to see a sustainability impact assessment defending France’s desire to undermine support for Canadian winemakers.)

– Trade in green technologies and environmental resources should be entirely liberalized. (This would likely include water services also, which a previous SIA report suggests would lead to more privatization of Canada’s public water utilities.)

– Ownership restrictions in fisheries and telecom should be removed entirely in Canada. (This too would do nothing to help the sustainability of Canadian fisheries. It may lead to over-fishing and put Atlantic fishermen and processors out of work.)

– CETA should harmonize environmental regulations, with special attention to fisheries, mining and oil, forestry and livestock.

– Canada and EU should make sure their Intellectual Property chapter is adopted more widely by pushing at WHO, WIPO, etc for the adoption of similar IPR enforcement standards. (This is despite recognizing in their report the impact the IPR provisions would have on drug costs in Canada.)

The Council of Canadians will be submitting comments to this latest SIA, including copies of our reports on CETA related to the tar sands and water privatization.