The free trade agreement with United States has caused significant political and financial damage in Canada. This is result of investigations by a Canadian Civil Rights institute that has time to go online. As a result, US companies have already sued Canadian state in framework of NAFTA free trade agreement 39 times, mostly in terms of environmental protection or resource policy.
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“The US companies see mselves in Canada faced with laws and democratic choices y don’t like,” says Stuart Trew of Canadian Center for Policy Alternatives (CCPA). The lawsuits, however, would have nothing to do with fact that US companies would be penalised by Canadian competitors. The rules would eventually apply to all.
Within framework of Free Trade agreement NAFTA, companies have opportunity to sue participating States before an international arbitration tribunal if y see ir investments at risk. In addition to Canada and USA, Mexico is also involved in agreement.
is applicable law overridden?
Similar provisions on this so-called investor protection can be found in planned free trade agreement TTIP between EU and USA. Even in Ceta, agreement between Canada and EU, companies are given se opportunities, but, unlike in NAFTA, re is a possibility of revision. Civil rights associations, as well as German organization LobbyControl, criticize fact that existing legislation in respective countries is overridden by agreements and that democracy is undergoing.
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NAFTA is being renegotiated at instigation of USA. US president Donald Trump referred to free Trade agreement as a disaster, but not because of regulatory issues, but because it assumes that a shift from production to Mexico has lost many jobs in US. Proponents are opposed to fact that problems in industry are mainly due to competition from China. The agreement has been in force since 1994.
Canadian consumer organisations and civil rights associations, however, consider NAFTA problematic because right of action for companies creates a kind of parallel justice that competes with State bodies. Stuart Trew of CCPA says: “It is a question of democratically made decisions that are at discretion of a government.” It is perfectly legitimate to implement a new environmental policy, even if it creates or conditions of business. For Canada, however, this resulted in high claims for damages against country under NAFTA.
The government has already paid more than 215 million US dollars in damages to plaintiffs, only about 80 million US dollars were incurred in legal expenses, reported CCPA. Eight lawsuits have been lost by Canadian state or y have been completed in a comparison, nine have been won.
© Andreas Prost Zacharias Zacharakis Editor in Department of Politics, Economy and society, time online to author page
On or hand, US would not have lost a single of 20 managed cases, writes CCPA. Critics complain that this could be due to fact that seat of arbitration Court is in United States. “At least from a statistical point of view, it is very strange and likely that politics will have an influence here. Or rules seem to apply to US, “says Trew.
It is also difficult to see how great deterrent effect is on politics, if companies threatened to sue, it is furr stated in CCPA report. States could n, as a precaution, decide not to pursue a regulatory agenda furr. According to CCPA in Canada, it was also possible to observe this: In 1990s, ban on an additive for petrol had been withdrawn, although it was considered to be harmful to health.
