TILMA: Corporate beggars take demands to Moncton; lobby group includes Canadian Council of Chief Executives, CGA-Canada & Canadian Chamber of Commerce

“The AIT is fundamentally sound though in need of refinement.”
– Carole Presseault, Vice-President, Government and Regulatory Affairs, CGA-Canada

It was reported in the National Post on August 2, 2007, that a coalition of leading Canadian business groups was taking its concerns on internal trade to provincial premiers at this week’s Council of the Federation meeting in Moncton. The article did not provide the names of coalition members.

An August 1, 2007, news release by the Certified General Accountants Association of Canada, however, shows that coalition members include: The Canadian Chamber of Commerce, the Canadian Council of Chief Executives, the Canadian Manufacturers & Exporters, the Canadian Petroleum Products Institute, the Canadian Restaurant and Foodservices Association, the Certified General Accountants Association of Canada, the Dairy Processors Association of Canada and the Vegetable Oil Industry of Canada.

The same news release is posted on the Canadian Chamber of Commerce website and gives Carole Presseault, the Vice-President of Government and Regulatory Affairs for CGA-Canada as the contact person for information. So it would seem that CGA-Canada has taken the lead on this particular endeavour.

It’s no surprise to see the Canadian Council of Chief Executives (CEEE) listed as a coalition member since the group seems to be running the country’s agenda at the moment. It is through their work that we now have the horrifying Security and Prosperity Partnership of North America (SPP) that the Harper Conservatives are pushing. The “deep integration” initiative also includes the shadowy North American Competitiveness Council on which the CCCE has ten members.

According to the news release “Canada needs a fully functioning and effective domestic market framework to be a real player in international trade.”

“Premiers need to show their commitment to an open, efficient and predictable domestic market by reforming the AIT’s dispute resolution mechanism and eliminating internal trade barriers,” said Anthony Ariganello, CPA (Delaware), FCGA, President and Chief Executive Officer of the Certified General Accountants Association of Canada (CGA-Canada).

A comprehensive list of genuine trade barriers between provinces that should be removed was not provided.

In an open letter to the provincial premiers on July 20, 2007, the business lobby group said the AIT “is limited, complex and inaccessible to businesses and others who have real trade issues” and “Canada needs…to eliminate the continuing drain on national resources that results from government measures which restrict or impede domestic trade and commerce for no good or justifiable reason.”

“Canada cannot have any credibility as a trading partner or in trade negotiations as long we have a market that includes policies and practices that restrict and impair trade,” the letter states.

Presumably, the “government measures” and “policies and practices” that need to be eliminated would include annoying things like measures adopted or maintained relating to Aboriginal peoples; health and education; regulated rates established for the public good or public interest; or social policy, including labour standards and codes, minimum wages, employment insurance, social assistance benefits and worker’s compensation. Measures adopted or maintained to provide compensation to persons for losses resulting from calamities such as diseases or disasters; assistance for recreation, academic research or to non-profit organizations. Measures adopted or maintained relating to the management or conservation of forests, fish and wildlife; or to the management and disposal of hazardous and waste materials.

“Those of us who have signed this letter represent major economic and public policy sectors in Canada,” the letter states.

The “public policy sectors” in question likely include conservative think tanks the Fraser Institute, C.D. Howe Institute, Conference Board of Canada, Atlantic Institute for Market Studies, Canada West Foundation, Frontier Centre for Public Policy and Montreal Economic Institute to name a few.

Next up are the lobby group’s demands asking the premiers to:

1) Make binding changes to the AIT’s dispute resolution mechanism so that it includes real consequences if governments fail to comply with their domestic trade obligations, including providing a mechanism for the private sector complainant to seek real remedies once a panel has found a government measure to be trade restrictive; and

2) Make a binding agreement that this revitalized AIT will apply to all government measures without qualification or exception other than for legitimate purposes as outlined in the Agreement, which does not include any form of trade restriction or protectionism.

Finally, the letter’s arrogant closing:

“We ask that the above…be agreed and completed at your August 8-10 Council of the Federation meeting, and we respectfully request public confirmation that you have done so in a timely manner following the meeting.”

One can only hope that the premiers, who were elected to represent all Canadians, show some backbone and send the corporate beggars packing.

On June 7, 2007, CGA-Canada issued a news release applauding the federal government’s proposal to enhance the Agreement on Internal Trade (AIT) stating: “In today’s meeting of the Committee on Internal Trade, Industry Minister Maxime Bernier proposed that action be taken to eliminate barriers to labour mobility within Canada, and that a more effective dispute resolution mechanism be incorporated into the AIT.”

CGA-Canada says that “the Trade Investment and Labour Mobility Agreement (TILMA), signed by British Columbia and Alberta, provides a possible model to establish and ensure an open and efficient domestic market.”

It is interesting to note that prior to being elected to the House of Commons in 2006 Maxime Bernier was a member of the board of right-wing think tank Montreal Economic Institute who also supports TILMA.

On June 4, 2007, CGA-Canada issued the report It’s Time to Move on from the Agreement on Internal Trade! Establishing an Open Domestic Market for Canada (May 2007).

Robert Knox, who CGA-Canada describes as “Canada’s pre-eminent expert on internal trade,” contributed to the development of the paper. Incidentally, Knox is a senior fellow at the Montreal Economic Institute and wrote a pro-TILMA op-ed which appeared in the Montreal Gazette on April 24, 2007.

“After considerable thought and discussion CGA-Canada has come to the conclusion that Canadian governments need to re-think their approach to regulating domestic trade. We believe that the AIT is fundamentally flawed and cannot be fixed by tinkering and incremental change,” the report states.

CGA-Canada proposes the following coverage and rules:

(i) Canadian governments should establish clear rules that would apply to any measure that restricts or impairs domestic trade and would require these measures to be changed to remove the restriction or impairment;

(ii) Limited exceptions should be allowed subject to an undertaking to eliminate them within a reasonable time; and

(iii) Restrictions or measures that impair trade would be permitted if they are necessary to achieve a legitimate objective, such as security, consumer or environmental protection or public health and safety. These exceptions must not be more trade restrictive than necessary to accomplish their objective.

This is essentially TILMA but in a different package.

CGA-Canada also calls for the federal government to “establish an independent “trade tribunal” to receive, mediate and adjudicate complaints concerning government measures that restrict and impair trade, investment and labour mobility; and establish, by mutual agreement, a Council of Ministers on Canada’s Domestic Market to monitor the openness and efficiency of Canada’s domestic market and to identify issues that need to be resolved in order to improve its effectiveness.”

The report closes stating:

“[W]e believe the federal government should take a more active role in establishing the open trade principle as Canada’s trade standard and facilitate its adoption by establishing a national trade tribunal. The federal government is Canada’s national government after all and the only government with a clear constitutional responsibility for interprovincial trade.

“CGA-Canada believes it is not possible for Canada to develop an open and efficient domestic market without the federal government’s leadership and participation.”

No problem. Enter federal Finance Minister Jim Flaherty a month later who reportedly said “internal trade barriers are on top of his agenda” and that he “has already told provinces to either piggyback onto the Alberta-B.C. deal, as is allowed, or emulate the pact.” [Flaherty wants to tear down trade barriers inside Canada, National Post, July 5, 2007]

On October 4, 2006, Carole Presseault, the Vice-President of Government and Regulatory Affairs for CGA-Canada appeared before the Senate Standing Committee on Banking, Trade and Commerce. In her statement on internal trade Presseault said “At issue is the AIT’s dispute resolution mechanism – an instrument we know is costly, difficult to interpret, cumbersome, and unenforceable.”

In fact, the dispute resolution system seemed to be the only issue on the table for CGA-Canada. “The AIT is fundamentally sound though in need of refinement,” Presseault said.

“We believe governments should be obligated to live up to the letter of the agreement by upholding trade panel findings.”

CGA-Canada suggested four specific measures that it believed would ensure the effectiveness of a dispute resolution process:

– Simplifying them and introducing greater transparency and accessibility to those people and businesses that are affected by barriers to trade and labour mobility;

– Lowering the costs and time required to launch complaints;

– Introducing a measure of certainty that governments will be respectful of and act upon panel findings in a concerted effort to eliminate barriers to trade and mobility; and

– Creating realistic and practical sanctions aimed at ensuring that governments respect their obligations under the AIT.

There were no doomsday scenarios presented to the committee or demands for a scorched-earth policy where every government measure, policy and practice that restrict and impair trade be eliminated with no exceptions. And this was only ten months ago. It seems since joining forces with the likes of the Canadian Council of Chief Executives and the Canadian Chamber of Commerce – whose own survey of its members in 2004 revealed that alleged interprovincial trade barriers are not a particularly important issue for Canadian business – the demands of the corporate elite and the tone of rhetoric has grown substantially.