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NEWS: Did Charest’s subway car deal just kill CETA?

A controversy that could kill the Canada-European Union Comprehensive Economic and Trade Agreement is brewing because Jean Charest’s government has awarded a $1.2-billion contract to build 468 new subway cars to the Quebec giant Bombardier and the French railway firm Alstom without a competitive bid.

The Canadian Press reports that, “The downside (of this decision) is that Charest, who likes to portray himself as an ardent supporter of free trade between Canada and the European Union, is being accused of squeezing out a European competitor.”
The Vancouver Sun reports that Spanish Prime Minister Jose Luis Rodriguez Zapatero has written Charest “expressing his annoyance” that a Spanish firm was excluded from the bidding process.

CW Media reports that, “Armand De Mestral, who teaches international trade law at McGill University… said the province’s move threatens Canadian efforts to strike a free-trade deal with the European Union. …He said the EU has always argued that access to provincial service markets and to provincial contracts is essential to any free-trade agreement.”

De Mestral says of Charest’s decision, “It’s totally contradictory to everything that the negotiation is about. It couldn’t be any more flagrantly in violation of the whole purpose of the agreement.”

And this evening Globe and Mail reporter Doug Saunders tweeted, “I think Jean Charest has just killed the Canada-EU trade deal (which he launched) with this untendered Bombardier deal.”

The Canadian Press explains that, “Quebec’s move to award the subway car contract originated four years ago when the Montreal transit commission initiated discussions with Bombardier for a no-bid contract. It then formed a partnership with Alstom after its rival went to court and successfully challenged the exclusive negotiations.”

“(And now) Spanish railway company Construcciones y Auxiliar de Ferrocarriles (CAF) has said it could deliver the cars at a much lower price and it is threatening legal action. …Phillipe Roy, a spokesman for the Spanish railway company, said CAF’s lawyers are studying the Quebec legislation with an eye to challenging it. …The Quebec government has (in response) tabled legislation aimed at thwarting any legal challenges of its decision…”

The Canadian Press article is at http://www.570news.com/news/national/article/111637–quebec-fights-off-legal-challenges-to-subway-contract-by-tabling-special-bill. Saunders’ comment is at .