Bill C-9 (Historical)

Settlement of International Investment Disputes Act

An Act to implement the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention)

This enactment implements the Convention on the Settlement of Investment Disputes between States and Nationals of Other States, opened for signature in Washington on March 18, 1965.

The House proceeded to the consideration of Bill C-9, An Act to implement the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention), as reported (without amendment) from the committee.

Settlement of International Investment Disputes Act

[Tony Clement, Conservative, Parry Sound—Muskoka, ON]

moved that the bill be concurred in.

[The Deputy Speaker, Bill Blaikie]

There being no motions at report stage, the House will now proceed without debate to the putting of the question on the motion to concur in the bill at report stage.

Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

[The Deputy Speaker, Bill Blaikie]

(Motion agreed to)

[The Deputy Speaker, Bill Blaikie]

When shall the bill be read the third time? By leave, now?

[Some hon. members]

Agreed.

[Tony Clement, Conservative, Parry Sound—Muskoka, ON]

moved that the bill be read the third time and passed.

[Deepak Obhrai, Conservative, Parliamentary Secretary to the Minister of Foreign Affairs]

Mr. Speaker, I am pleased to speak today in support of Bill C-9, An Act to implement the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention), which I will refer to as “the convention”.

The convention was sponsored by the World Bank to facilitate and increase the flow of international investment. It establishes rules under which investment disputes between states and nationals of other states may be resolved by means of conciliation or arbitration. It also creates the international centre for the settlement of investment disputes, known as ICSID.

Bill C-9 implements the ICSID convention for Canada. It deals with enforcement of ICSID awards for or against the federal government and foreign governments, including the constituent subdivisions designated by foreign governments.

The convention deals with what is commonly called the resolution of investor-state disputes. Such disputes arise in a variety of situations. For example, they can arise when a state where a foreign investor has invested adopts laws affecting the activities of the investor in a discriminatory manner or nationalizes the investment.

International arbitration is a recognized method for resolving disputes. It provides a way of resolving legal issues without resort to the domestic judicial process.

It has long been recognized that when parties to a dispute have recourse to arbitration, the result of the arbitral process ought to be recognized by the courts. Thus, for example, the awards resulting from commercial arbitration, in other words from arbitrations between business enterprises, are recognized and enforced by courts.

The decision as to whether to have recourse to arbitration or the judicial process is a decision for the parties to dispute. This flexibility is welcomed in many types of situations.

In the case of the convention being implemented by Bill C-9, one of the big advantages of having recourse to arbitration is that it “denationalizes” the process. Let me explain.

When a dispute arises between a foreign investor and the host country, one of the options is for the investor to pursue the case before the courts of that host country. In most cases, as would be the case in Canada, the foreign investor would benefit from a fair and equitable process; the national court would not prejudge the matter and would render a decision in conformity with the law.

However, in some situations this might not happen. The tribunal might favour its government to the detriment of the foreign investor.

The fact that the parties to an arbitration can select the arbitrators who will hear and decide the case is another advantage of the arbitral process. If the dispute involves a specialized matter, for example, petroleum exploration, or maritime issues, the ability to choose arbitrators with specialized knowledge on the subject matter of the dispute can make the entire process work much better and can lead to better decisions.

The arbitration mechanism established by the ICSID convention is one that is used for disputes between investors and states. The convention has been ratified by 143 states, making it one of the most widely ratified of all international instruments.

The distinguishing feature of ICSID, what makes it uniquely valuable, is the enforcement mechanism which this legislation will implement for Canada. The ICSID enforcement mechanism is very effective. This effectiveness contributes to the protection of the investor. ICSID's enforcement mechanism lies at the heart of the effectiveness of the ICSID convention.

An arbitral award from any other arbitral body is subject to review by a domestic court before it can be enforced, but an ICSID award merely has to be presented to a domestic court with a request that the court enforce it. Under Bill C-9 the award must be recognized and, with this recognition, enforcement mechanisms become available immediately. Enforcement could include payments seized by officers of the court.

In the great majority of cases the losing party in an arbitration will pay the award of an arbitral tribunal without the need for the successful party to take any enforcement proceedings. The same is true for investor-state arbitration.

In Canada, arbitral awards, including investor-state arbitral awards, are currently enforced pursuant to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

The New York convention permits a limited review of an arbitral award by domestic courts. It allows a court to refuse to enforce an award if to do so would be contrary to the public policy. In addition, it permits a state to exclude certain subjects from the application of the convention and thus from enforcement.

The ICSID provides a better enforcement mechanism. It does not permit a state to exclude from dispute settlement any matter which the state has consented to submit to arbitration. The ICSID awards are enforceable as if they were final decisions of a local court. This simple, efficient mechanism guarantees better protection for Canadian investors abroad.

Clause 8 of the bill authorizes any superior court in Canada to recognize and enforce awards as described in the bill. The Federal Court is a superior court. The Federal Court would have jurisdiction over awards involving the Government of Canada and awards involving foreign governments or their constituent subdivisions designated under the convention.

In addition, the ICSID convention provides explicitly that the ICSID awards are binding between the parties and once parties have agreed to arbitration they cannot seek remedy before another body, such as courts of justice.

Therefore, it is not open to a foreign tribunal to refuse to enforce an award on the basis that the ICSID arbitration tribunal has exceeded its jurisdiction or was not validly constituted. These kinds of issues can affect enforcement of awards other than ICSID awards, thereby delaying resolution of the dispute. The ICSID does not permit such dilatory tactics.

Section 7 of the bill provides that an ICSID award is not subject to any remedy by a Canadian court. Remedies thus prohibited would include appeal, review and nullification. The decision to have recourse to arbitration is entirely voluntary, but once the parties have consented to ICSID arbitration they cannot seek review in another forum, such as the courts.

The only review of an ICSID award, if a party to a dispute considers it contains errors, is the review process provided by the convention itself. It provides that a request for revision, interpretation or annulment of an award must be made to the secretary-general of the ICSID. This procedure allows the parties to avoid having national courts involved in assessing allegations that claim there is something wrong with an award, while at the same time ensuring the awards which are erroneous can be corrected.

There are numerous reasons to support Canada's adherence to the convention. It would provide additional protection for Canadian investors abroad by allowing them to have recourse to the ICSID arbitration in their contracts with foreign states.

It would also allow investors of Canada and foreign investors in Canada to bring investment claims under the ICSID arbitral rules where such clauses are contained in our foreign investment protection agreements and free trade agreements.

To date, 143 states have ratified the ICSID convention. The majority of our trading partners are parties to it, except for Mexico, India and Brazil. Ratifying the ICSID would bring Canadian policy into line with our OECD partners. In a survey conducted by the ICSID center in 2004, 79% of the respondents said that the ICSID played a vital role in their country's legal framework and 61% said that the ICSID membership had contributed to a positive investment climate.

We know, anecdotally, that Canadian investors are trying to find ways to benefit from the ICSID, even though Canada is not party to the convention. Firms have, for example, arranged investments through a third country that is party to the ICSID. However, such convoluted financing is not possible for all investments by Canadian investors.

International investment arbitration is growing in importance. The stock of Canadian direct investment abroad in 2005 increased to a record $469 billion. As a result of the globalization of investment, the number of investment disputes has greatly increased in the last five years.

ICSID arbitration has soared: only 110 ICSID arbitrations have been completed over the past 40 years but 105 proceedings are now under way. The NAFTA parties alone have faced over 40 investor-state arbitration claims since NAFTA entered into force.

The tremendous growth in investment and investor-state disputes has made Canada's failure to ratify the ICSID the focus of attention by Canadian businesses, the Canadian legal community and our trading partners.

The ICSID regime provides several important advantages. Compared to other arbitration mechanisms, the ICSID regime provides better guarantees regarding enforcement of awards and more limited local court intervention.

Any arbitral award rendered under the auspices of ICSID is binding and any resulting obligation must be enforced as if the award were a final domestic court judgment. Moreover, all ICSID contracting states, whether or not parties to the dispute, are required by the convention to recognize and enforce the ICSID arbitral awards.

Investors often prefer to rely on such arbitrations rather than on the local courts of the country whose measures are in dispute to ensure an independent resolution of the dispute.

The ICSID's relationship with the World Bank assists investors in obtaining compliance with the ICSID award and its roster of arbitrators gives investors access to well-qualified arbitrators at ICSID controlled rates, with extensive experience in international investment arbitration.

The ICSID also provides important institutional support for litigants. The ICSID convention is a well known tool for settlement of investment disputes. Therefore, the interpretation of the convention and its usefulness are predictable.

Canada already has numerous links with the ICSID. Provisions consenting to ICSID arbitration are commonly found in contracts between governments of other countries and Canadian investors. The NAFTA in chapter 11, the Canada-Chile FTA and most of our bilateral foreign investment protection agreements known as FIPAs all provide for the ICSID as a dispute settlement option that can be chosen by an investor if both the state of the investor and the host state for the investment are party to the ICSID.

However, Canada and Canadian investors cannot benefit from this choice if Canada is not a member.

It is important that Bill C-9 be passed in order to facilitate adherence by Canada to the ICSID convention as soon as possible.

[Chris Charlton, NDP, Hamilton Mountain, ON]

Mr. Speaker, for me this has a bit of the same feel to it as the multilateral agreement on investment did under the former Liberal agreement. I have concerns about transparency and about accessibility for people to actually participate in the process.

However, I guess my most important concern focuses on accountability. As I look at all of this, the decisions issued through an ICSID arbitration are binding and there are limited grounds under which the process can be appealed. They are all very narrow reasons. They include: the tribunal was not properly constituted; it manifestly exceeded its powers; there was corruption on the tribunal; there was a breach in the rules of procedure; or, the award failed to state the reasons on which it was based. These grounds make absolutely no allowances for other substantive reasons for which a sovereign state might well decide, for the benefit of its citizens, to disagree with an arbitration decision.

I wonder if the member could elaborate a little more on why he feels comfortable, as a member on the government side, to do this to the Canadian public, to support a process that, as I said earlier, has no transparency, no accountability and no accessibility.

[Deepak Obhrai, Conservative, Calgary East, AB]

Mr. Speaker, I thank the member for asking a question that many would want to ask. She wants to know why we have the ICSID convention because it is under the World Bank and it gives transparency under the World Bank rules to ensure that what she has expressed as a concern is overridden. The confidence level given by this convention is what investors are looking for.

However, there is a provision in the convention where the secretary-general of the ICSID can accept a request for a revision, interpretation or annulment of an award.

As I mentioned in my speech, this convention, as signed by 143 countries, has put international confidence in the mechanism for investment where both the investor and the government can have confidence. We cannot have confidence on one side where we can say that the investor is subjected to a government board or a court of law where he feels he did not receive justice.

At the end of the day, the issue is about receiving fair treatment and justice and that it is transparent. This convention provides that, which is why 143 countries have signed on to it.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I listened carefully to the parliamentary secretary's comments on the bill and certainly listened carefully at committee to presentations and representations by those who brought forward their opinions.

At committee we heard from those who are backing this bill that the sky would not fall and that productivity and investment would still continue if the bill does not pass. If we were to listen to the government and the official opposition party, we would think that this is something that we need, that this is key to Canada's success and to investment coming into Canada.

However, what was not touched upon is the opinion of some of the provinces. I find it passing strange that the Bloc will be supporting the bill because it would actually take away, in some respects, sovereignty, particularly in the case of financial oversight from Canada. I am surprised that the Bloc would support taking decisions that could be made here in Canada and really throwing them over to the World Bank which, as we know, is situated elsewhere. That is not to mention the concerns people have had as of late in terms of transparency and accountability at the World Bank. I need not go into that narrative. It is a long one and we know the recent problems at the top.

At committee we heard very clearly that notwithstanding that countries have signed on to this, this is a file that has been around for quite awhile. We also heard that this would not guarantee increased investment but that there is jeopardy in terms of handing over accountability.

Why would the government, which has told the Canadian public many times that it believes in accountability in its own operations, hand this kind of process procedure over to the World Bank when those decisions should be made right here in Canada, have Canadian oversight and remain a tool that we can use? Once we sign on to this, we are handing it over to another institution and, indeed, to another jurisdiction.

[Deepak Obhrai, Conservative, Calgary East, AB]

Mr. Speaker, one would not expect the NDP to look at the advantages of foreign investment in Canada. The member seems to forget the other side of the coin with investment going out of the country.

Over 45% of Canada's GDP is based on imports and exports. We are a trading nation. We need prosperity. We need mechanisms that not only provide for foreigners to invest in Canada but provide Canadians with the opportunity to invest overseas as well. That is the way our country prospers. We need mechanisms in place that would give confidence to both sides of the coin.

The NDP would never want that. The NDP wants Canada to live in a cocoon of its own. I am happy to say that is not what Canadians want. That is not what the Canadian business community wants either. With 143 states signing, this gives confidence now.

It is surprising to me that NDP members are today saying that they have no confidence in the World Bank because they are known as the biggest supporters of the World Bank. At the end of the day, those members want development and all these things. The World Bank is one of the institutions that does that.

We do have dispute mechanisms in other areas. As I alluded to in my speech, this is one of the best dispute mechanisms and it would give investor confidence to both sides of the business community.

[Penny Priddy, NDP, Surrey North, BC]

Mr. Speaker, transparency is one of the things the public is particularly concerned about not only in this agreement but with government processes in particular. People tell me that they have no idea what is going on, that they do not know how to get information and that the information seems quite secretive.

There will be no transparency in this process because the agreements will not be released to the public. The public will not know how the agreements are awarded. If we are interested in transparency or in making a cogent decision, it is interesting to note that there is no allowance for third party, or amicus curiae as the document refers to, to get more information on a decision about to be made.

The bill states that once the consent of a party is given it cannot be revoked. I understand the need for stability and that consent is not given lightly because many things may be dependent upon that. However, it is very worrisome to say that under no circumstances, no matter what happens, consent cannot be revoked. We are not always able to foresee the future. We are not able to say that it will always be fine under these circumstances, that this will be a very binding agreement.

Decisions about how the awards are made will not be available to the public. These decisions will affect the public both here in Canada and abroad in a variety of ways. For the public not to have access to this kind of information because of the lack of transparency is a problem.

Could the parliamentary secretary perhaps describe why no information about the awards should be made available to the public under any circumstances?

[Deepak Obhrai, Conservative, Calgary East, AB]

Mr. Speaker, this dispute is between two parties that have agreed to go in front of an arbitration tribunal. Therefore, it is important to recognize that when two parties go there, they decide what they would like to discuss and how, and they like to keep their affairs out of the public domain unless it is part of a public policy issue.

When an investment is made, the laws of the country are always maintained. As the Parliament of Canada, we create the laws as to how companies will operate in Canada. Any investment that comes into our country will be required to operate under our laws as made by Parliament. That will never change.

The arbitration tribunal will not override the laws of our country. It will only make decisions based on a dispute mechanism for reasons of investment, but our laws, as established by the Parliament of Canada, will be protected.

[Bryon Wilfert, Liberal, Richmond Hill, ON]

Mr. Speaker, I am pleased to speak to Bill C-9. It is interesting that the government introduced the bill to promote cross-border investment at a time when it has shown a complete lack of understanding and, indeed, incompetence when it comes to this very issue. Nevertheless, the bill would create a set of rules for mutually agreed upon arbitration, which is important, for hearings between investors and foreign governments.

There is no question that 156 countries have signed on to this and over 144 now have ratified this agreement. Therefore, it is important that Canada be one of those, considering some of our major trading partners, including the United States and Japan, have signed on to it.

There is no question, though, that the government, in doing this, has nevertheless mishandled parts of the economy, as we have seen. We look at the forestry industry as a good example. We look at the manufacturing sector. Clearly, we need to be aggressive in international markets. It is important that our investors have certainty in terms of the investment climate, the investment regime when they are investing abroad. The vast majority of countries, as I said, have signed the ICSID. Therefore, it is incumbent upon Canada to do so.

There is no question that increased trade with countries such as China is important and that we have a governing structure that meets the demands and the needs of Canadian investors abroad. They need to have that assurance with regard to an arbitration mechanism. There is no question it is important that we protect and enhance the rights of Canadian investors.

The ICSID convention is an international instrument sponsored by the World Bank. There may be some members who have concerns about that. I do not. In 2006 the transparency aspects of the governance procedures were toughened. It is important to facilitate the increased flow of cross-border investment, something that we know all too much about in this country.

The convention certainly establishes a mechanism which gives that assurance to Canadian investors, something the investment community has demanded for a while. They believe it is important for them in order to do business, and on this side of the House we agree.

It is also important that we have dispute mechanisms because of problems we have seen in the past. Some countries want investment but are not prepared to provide the kind of investment regime that is stable and that provides the rules of the game for investors.

We cannot encourage people to invest abroad in a particular sector if we are not sure if that investment is protected. We have seen cases of nationalization. These are concerns. We have seen problems in Indonesia when we had the situation with Manulife. To deal with that, it was taken to the supreme court in Indonesia.

Having a stable investment regime is important. Having a mechanism to deal with arbitration is critical.

This has been around since 1966. It is interesting that of the 143 countries that have ratified those instruments, many of them are our major trading partners. We need to be in lockstep with them to ensure we are on the same playing field.

Investment disputes are brought under the convention and are administered by the International Centre for the Settlement of Investment Disputes in Washington, D.C. Its activity has increased over the last number of years. At one time it only handled 110 arbitrations in total for 40 years, but as more and more countries have come on board, it is currently dealing with about 105 disputes at the present time. It is obviously a mechanism that people are using. It is a mechanism in which people believe. It is a mechanism that this side of the House supports.

Obviously the centre was established in the very beginning to provide a reliable and effective instrument for resolving investment disputes. I think that is the one thing that we heard at committee. That is the one thing we continually hear: that this gives certainty and that it is the kind of thing the investment community certainly wants to see.

Once this is ratified, it will allow Canadian investors abroad to go out and make contracts with foreign states. They have that option. If they want to go to the ICSID convention, they can do that. It is an option they will have under this agreement.

As well, Canadian investors doing business in a country in which Canada has a foreign investment protection and promotion agreement will have recourse to this arbitration for violators of the agreement. Again, this is providing assistance in that regard.

I think probably the most important advantage is the enforcement of arbitrary awards. Again, this is something that the committee heard about. Again, it is something that we believe is important. Unlike awards issued by other arbitrary institutions, domestic courts cannot refuse to enforce these decisions that are issued under the ICSID. That is important.

Such awards are enforceable in any country, which is important to underline. It can be enforced in any country that has ratified the convention. I think that makes it extremely important for investors and it is why we need to be part of this. When the final judgments are made, they are enforced.

Canada signed this convention in December 2006. In our federation, British Columbia, Newfoundland and Labrador, Nunavut, Ontario and Saskatchewan have already adopted their own implementing legislation. I think it is important that, again in concert with the provinces and the territories, we move forward on this legislation.

When it comes to investment, the international community is very competitive. If a company is going to make a major decision to invest abroad, it needs to have that certainty. As a country, I think we certainly want to encourage good investment. We want to make sure that when our investors are abroad they are not going to be held to ransom or made hostage to arbitrary changes in government policy abroad.

That is why so many countries have signed on. They believe this is an effective way to go and that it does provide the kind of assurance we need. Certainly on the issues of transparency, the committee heard how that was strengthened. At times, I think, it is important to be part of these international conventions, these international covenants, in order to provide the kind of security we need.

Clearly when countries like the United States, the United Kingdom, and Japan sign on, it is important. Japan has the second largest economy in the world. The Japanese are signators. Japan is a very important market for Canadian business. We often overlook Japan and think about China, but Japan has an economy greater than that all of Asia combined, including China. Again, we have tremendous opportunities in Japan.

There may an opportunity down the road to look at a free trade agreement with the Japanese. The Japanese have become very aggressive lately in signing deals with the Philippines and Mexico, countries with large agricultural sectors. For the Japanese, the agricultural sector is very sacred, yet they have been able to come to agreements with those two countries.

The Japanese are watching Canada's negotiations with South Korea very carefully. Obviously we have issues to deal with, not only in the agricultural sector, and certainly in the automotive sector. Of course, our party has made it very clear that we do not want a deal at any price. We want to make sure that our automotive sector has the kind of ability to go into the South Korean market that we see others enjoy, certainly in terms of what the Japanese are doing here. The Japanese are investing in Canada in the automotive sector and the South Koreans are not. Therefore, we cannot do that.

It is important that the Japanese have signed on. The Germans have signed on. The French have signed on. Again, all of these countries have signed on because they realize how important this convention is. For those of us who understand those market conditions, it clearly is important that we are part of this, so we will support the government on Bill C-9 when it comes to passage of this legislation.

Obviously we are concerned that Mexico, India and Brazil have not yet signed on. Again, the need to continue to encourage them to be part of this international convention is important. It is important to look at the benefits for their investors, as well as ours, as we move forward in this regard.

In terms of its international participation in promoting Canadian companies, the government has had a checkered past, but at least this bill will provide rights for our investors in other jurisdictions. At least on this issue, the government has it right.

Unfortunately, the government still does not understand the problems that our own domestic sectors are having, particularly in the forestry, the manufacturing and the auto sectors. These are issues that this party, the Liberal Party, has articulated for a long time.

Clearly because of the good management of previous Liberal governments, we were able to leave an impressive cupboard in terms of the economic tools that the government has been able to use over the last couple of years. The Conservatives did not do it. It was the Liberal government, working with Canadians, that was able to eliminate the $42.5 billion deficit it inherited from the Conservatives and that was able to make us the only G-7 state paying off our national debt. That is a very impressive record.

When the Conservatives talk about the last 13 years, the last thing they want to talk about is the last 13 years of good Liberal economic management. That is okay, because we know and Canadians know the economic record of this country.

We know what is important in terms of dealing with the business community abroad. That is why we will support this legislation. We believe very strongly that good fiscal tools at home and good investment tools abroad obviously are good for Canadians. They will promote jobs and they will secure jobs. We believe very strongly that this is the way to go.

I would suggest that at the end of the day, when presumably this legislation is adopted, the rules of the game will be very clear. They will be helpful. We should see an increase in people wanting to invest and also of course in encouraging other countries to invest here, because the rules work both ways for those who have signed on. Again, we are looking at 144 countries that have ratified this particular convention so it is something that we see as important.

Of course on this side of the House we believe in sound economic principles and obviously we are prepared, when we see good legislation come forward, to work with the government on it. Obviously if there is bad legislation we are not going to support it, but there is no question that in the standing committee we heard very clearly the need for this legislation and the rationale for it. Again, we will support this legislation as we move forward.

I take it that there will not be support from some of the parties in the House, but nevertheless I think that at the end of the day Canadians will be supportive and appreciative of the fact that the right thing was done and the rules have been made very clear on arbitrational issues. I think that is what is needed and we support it.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, I thought my hon. colleague's speech was fascinating. It actually fits in very well with an article I was reading in the Winnipeg Free Press today. The headline is: “Grits? Conservatives? Same thing. Poll says Canadians find the two major parties interchangeable”. According to the Canadian Press Harris-Decima survey, Canadians “view the two main political competitors--the Conservatives and the Liberals--as interchangeable”.

If we want proof of that, we only have to listen to what we hear from over there. Of course it was the Liberals as the champions of free trade who told us we would have clear investment rules with NAFTA. What we ended up with were secret tribunals under chapter 11.

I will bring forward the example of Metalclad, the company that went after the Mexican government because it felt that its right to dump toxic waste in a neighbourhood in Mexico was violated. Of course the Liberal Party thought Metalclad's position certainly was violated because it was a corporate investor.

Even though a municipal government, working with the state government and the federal government to protect its citizens, came forward with legislation to stop this toxic dumping, Metalclad had the ability to go before the chapter 11 tribunal, which is similar to what is being proposed with the kangaroo court at the World Bank, where there was an unaccountable forum, where the community and the country could not even bring legal depositions before it, and where the appeals process does not exist.

I love this: at the World Bank, it is going to be secret. It does not even have to tell people when they have been stuck in the back so of course the Liberal Party loves this. This is the Liberals' idea of free trade. It fits in perfectly with the Conservatives' idea.

I have a question for the member. Why do the Liberals not just join up with the Conservatives? They certainly have the same view of the World Bank, which is already a discredited institution in terms of development. They would allow unaccountable, hidden tribunals to go forward with no right of appeal. What does that say for the people of this country?

[Bryon Wilfert, Liberal, Richmond Hill, ON]

Mr. Speaker, the one thing that Canadians will never confuse is the fact that there are only two parties in the House that could be in government and that certainly will not be the member's party. There is no question that when it comes to understanding the economy and investment, it is not that party in the corner.

Obviously the member was not listening. There is no question that when it comes to sound economic policies and understanding them, it was this side of the House, the Liberal Party, in conjunction with Canadians, that was able to turn what was considered by economists and others a basket case in 1995 into an economic marvel. The fact is that we paid off the national deficit and we were paying down the national debt.

The only similarity with the present government in power is that it is simply carrying on the good policies of the Liberal Party in terms of paying off the national debt. That is something the NDP does not know. The NDP is the party that one day stands in the House and says we should spend $5 billion and the next day says we should cut $2 billion. Mathematics is not the forte of the New Democratic Party, so it is understandable that when it puts two and two together and get five those members think that is okay. This side of the House does not believe that.

Let us go back to the point the member was making. In April 2006 the ICSID brought in reforms for transparency: open hearings. Maybe it is okay to have activities at the Montebello in a closed session, I do not know, but on this side of the House we believe in transparency. That is what was brought in: open hearings. Of course there are some caveats when dealing with specific business information, but in general the hearings are open and transparent. The member can read about the changes that occurred in April of 2006. They were established in response to the very issue that the member raises.

Again, Liberals do not support anything which would be done in the backrooms. We believe in transparency and accountability. If the member is suffering from any delusion that his party is ever going to be government, he obviously has consulted Tinkerbell.

[Penny Priddy, NDP, Surrey North, BC]

Mr. Speaker, I am interested, to say the least, in the comments that the member has made, the first one being that it will only ever be the Liberals or the Conservatives that are government. Talk about entitlement, that somehow this member has said that this is an entitlement, that there could only be two parties ever in Canada. I would suggest that perhaps not all Canadians would like their vote nullified and removed.

The other piece I was concerned about was the member talking about following the good policies of the Conservative government. Sometimes it is hard to tell because when members are sitting down during a vote, it is a little hard for me to know whether they are following or not following the policies of the Conservative government.

However, this is a secret tribunal and not every arbitration is secret as we heard argued earlier by the parliamentary secretary. These are secret. There is no access by the public to the results of the arbitration at all, so I do not know how anyone could argue that these are not secret tribunals and the information is therefore not kept secret afterward.

I would like to hear the member describe why he would not describe this as a secret tribunal if only the two parties and the people in the World Bank are the only individuals who are allowed access to that information.

[Bryon Wilfert, Liberal, Richmond Hill, ON]

Before I directly answer that question, Mr. Speaker, I would point out that for a party that has attacked the government for saying it is the “new government of Canada”, the New Democratic Party has been around for about 40-odd years and it is still only at 29 or 30 members. I would suggest that the reality at the moment is that the only two parties that seem to be realistically looking to form a government are the two here.

However, on the question of entitlement, those party members think they are entitled to make all sorts of statements that are not based on fiscal reality and yet expect people to buy them.

In answer to the question, maybe the member should go to the website. If the member went to the ICSID website, she would find that all awards by the tribunal are posted. So, I am not sure what the problem is. If the website posts all details of the awards, the information is there. It does require turning on a computer. It does require that one finds the website and it does require that one reads it. But beyond that, all the information is there.

I would suggest that this is accountability. It is very useful obviously, people are going to look at that. If the member does not have the website, I would be more than happy to share it with her later, but it is important not to suggest or mislead Canadians that somehow this is all done behind closed doors. There is a process.

I have made it very clear what that process is and from that perspective, that information is on the website in terms of all of those awards. Access to those awards is there. That is something we would expect, Canadians would expect, and it is there. Beyond that, I do not know what else to say. Access is right there at one's fingertips.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I was not intending to make a comment or question but I do have to clarify something. I have the blues from committee in my hand and on the question of transparency, indeed there were changes made and proposed April 2006. What is important to note, and I asked the very question in committee to a witness, is that there are a couple of changes. In April 2006 the information I had suggested regarding amicus curiae briefs was not allowed and now the member is saying that has changed. The witness was responding with the same information as the member has given.

What it says and what the witness says is that there is a process now to ask tribunals to submit an amicus curiae brief or the equivalent of that at the discretion of the tribunal depending on how helpful it can be and how relevant it is.

Yes, there have been changes made. Obligations there are not. When the member says it is absolutely transparent and we can go on the website, I have done it, but one will not get chapter and verse. In fact, all one can get is what the tribunal deems to be relevant, deems to be something that it wishes to pass on. So it is important to clarify that and I would like my colleague to respond to that as well.

[Bryon Wilfert, Liberal, Richmond Hill, ON]

Mr. Speaker, I have some blues in front of me and as the member knows, the same application applies domestically. There are exceptions, absolutely, but to suggest, as his party has done, that everything is behind closed doors, that there is no transparency and that none of this exists is absolutely, blatantly false. We know that is false.

There are exceptions as there are domestically but the reality is that in the main we have an open, transparent process, and have the ability to look at the renderings of the tribunal. That is what we would expect, that is what is there, and it stands for itself.

[The Deputy Speaker, Bill Blaikie]

It is my duty pursuant to Standing Order 38 to inform the House that the question to be raised tonight at the time of adjournment is as follows: the member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, Manufacturing and Forestry Industries.

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, it is a pleasure to see you and the other members again. Now, the question is how much longer we will be together here for this session. Because of the Conservative government's insensitivity towards the crisis in the manufacturing and forestry industries, which we will debate during the late show this evening, as you said, Quebeckers are becoming more and more outraged with this government. Obviously, when the time comes to make important decisions, we will be here to defend the interests of Quebec, as we always have.

The Bloc Québécois supports passing Bill C-9. Passing this bill will finally enable Canada to ratify the convention on the settlement of investment disputes between states and nationals of other states, and also to become a member of the International Centre for the Settlement of Investment Disputes, or ICSID.

Bill C-9 integrates the requirements of the international convention in the laws of a country, in particular to ensure that arbitral awards are respected and to provide for the immunities required by the centre and its staff. ICSID is responsible for arbitrating disputes between States and foreign investors. There may be two types of disputes: disputes related to compliance with bilateral foreign investment protection agreements and disputes related to agreements between governments and foreign investors. The Government of Quebec regularly signs the latter type of agreement when eliciting foreign investment with the promise, for example, of providing electricity at an agreed price.

Canada's membership will not have any impact on the provinces, except that they too may have recourse to the ICSID when they conclude agreements with investors. The only thing that Canada's membership in the centre will change is that Canada will be able to intervene in negotiations to amend the convention or the rules of the centre and it will enjoy the assurance of being able to join in the appointment of arbitration tribunals.

Ultimately, the ICSID is a tribunal. The problem is not the tribunal or membership in the tribunal. The NDP member asked earlier how the Bloc Québécois could support Bill C-9. Fifty-six countries are now part of that agreement. That is not the problem. Rather, the problem lies in the poor investment protection treaties that Canada concludes and continues to conclude despite the bad examples we have seen, particularly—and I will come back to this later in my speech—concerning chapter 11 of NAFTA.

The Bloc Québécois supports the conclusion of investment protection agreements, as long as they are good agreements. It is completely natural for investors, before making an investment, to try and make sure they will not be divested of their property or that they will not become victims of discrimination. This is the sort of situation that foreign investment protection agreements are meant to cover.

In most cases, investors themselves can submit disputes to an international tribunal, but only once they have obtained the state's consent. However, in the investment protection agreements they have signed, only two countries, Canada and—guess which other country—our friend, the United States, systematically give investors the right to apply directly to the international tribunals. That is a problem, I would even call it a deviation from the norm. By allowing a company to operate outside government control, it is being given the status of a subject of international law, a status that ordinarily belongs only to governments or states.

The agreements that Canada signs contain a number of similar deviations that give multinationals rights they should not have and that limit the power of the state to legislate and take action for the common good. I was speaking about chapter 11 of NAFTA, which unfortunately is now well known. This chapter of NAFTA on investments provides that a dispute can go to ICSID. That chapter is a bad agreement in several respects. I will give you some examples.

The definition of expropriation is so vague that the slightest government action, other than a general tax provision, can be challenged by a foreign investor if it reduces its profits from its investment. Take, for example, the plan to implement the Kyoto accord, which would heavily penalize big polluters and oil companies and could be challenged under chapter 11 and result in the government paying compensation. The Alberta oil companies are in fact mainly owned by American interests. Chapter 11 opens the door to the most abusive proceedings.

Furthermore, the definition of investor is itself so broad that it includes any shareholder.

Therefore anyone could take the state to court and attempt to obtain compensation for a government measure that allegedly reduced a company's profits.

As for the definition of investment, it too is so broad that it even includes the future profits that an investor hopes to earn, even though this is only a projection. In the case of expropriation, not only does the state find itself forced to pay fair market value, but it must also include revenues that the investor expects to earn in future. It would no longer be possible to nationalize electricity, as Quebec did in the 1960s.

We can look at situations that have occurred over the years. For example, SunBelt, a corporation with a Canadian shareholder and a Californian shareholder, closed its doors when the Government of British Columbia withdrew the right it had granted for the bulk export of water. The Canadian shareholder, based on Canadian laws, received compensation equivalent to the value of his investment, or $300,000. The American shareholder, based on NAFTA chapter 11, included potential future revenue from the sale of water in its claim: $100 million. We do not know the full story, because the case was settled out of court for an undisclosed amount, but we can see just where abuse can lead.

As an aside, that is what prompted the Bloc Québécois to present a motion to ensure that, in light of NAFTA, water is not considered a commodity and that it cannot be sold in bulk, as the Americans would like. We do not want to lose this great wealth of Quebec and we do not want this to become a shameless object of trade.

Given the amounts of money at issue, chapter 11 discourages any governmental measure, when it comes to the environment in particular, that would decrease the profits of a foreign owned company.

The dispute settlement mechanism currently allows companies to turn directly to international tribunals to seek compensation without the need for the state's consent. I was talking about that earlier. This is a serious problem. A multinational could, on its own authority, be behind a trade dispute between two countries. That could happen the way things stand now. It is that type of absurd situation that chapter 11 of NAFTA on investment allows.

The government must enter quickly into discussions with its U.S. and Mexican counterparts to amend chapter 11 of NAFTA. The Bloc Québécois has been calling for that for a very long time now. We have seen the abuses that have resulted from this. Instead, the government is adding more agreements and, in those agreements, we find a carbon copy of chapter 11 of NAFTA.

In addition to chapter 11 of NAFTA and despite the fact that everyone has criticized its abusive nature, the government has concluded no less than 16 other bilateral foreign investment protection agreements that, as I was saying, are carbon copies of chapter 11 of NAFTA. All these foreign investment protection agreements are bad and should be renegotiated.

The Bloc Québécois is calling for more transparency, more democracy. The government must submit to the House all international treaties and agreements before ratifying them. That is another problem that should be discussed more broadly here, in this House. We must also ensure that the public realizes that many international agreements can be concluded in secret.

For example, earlier this year, the government announced in a news release that it had signed a new investment protection agreement with Peru. That was how we found out about the agreement. Parliamentarians and the general public knew nothing about the agreement until they read the news release. Moreover, not many members of the media gave this story a very high profile. Parliament was never informed, nor did Parliament approve it. This is totally undemocratic. The strange thing is that we have before us a government that boasts about keeping its promises. It says that it follows through on the promises it makes. I would like to remind members of this House, the general public, and especially the government that that is not true. The government does not always do as it says it will. It does not always keep its promises. The Conservatives' election platform during the last campaign was very clear. The Conservatives promised to submit for approval all international treaties and agreements before signing them. That is not what has been happening. Since the Conservatives came to power, Canada has signed no fewer than 24 international treaties.

With the exception of one single amendment to the NATO treaty that was the subject of a last-minute debate and vote here, none of these treaties were brought before the House. So much for that promise, which the government casually dismissed.

These days, international agreements can have as great an impact on our lives as laws. Nothing can possibly justify the secretive, unilateral ratification of these agreements by this government or any government without the participation of the representatives of the people.

People do not send us here for nothing. We often have to explain what the federal government is up to, a government that, it must be said, seems more remote than municipal governments or the National Assembly and other provincial governments. We explain what we do, the bills we pass and so on.

People understand that international trade and foreign affairs fall largely under the jurisdiction of the federal government. It is our job to take care of such things here. Yet, as I just explained, the government has been signing most of its international agreements without giving us a chance to vote on them.

As usual, we Bloc Québécois members are taking action. Some claim that we merely talk, but the fact is that we also act. We have introduced bills to restore democracy and ensure the respect of Quebec and provincial jurisdictions in international treaties. I will get back to this later on. We presented a bill on this issue on three different occasions.

Today, we can see that the Conservatives' word is not worth much. It is not worth anything, particularly in this area. This is why the Bloc Québécois will raise this issue again and will bring forward proposals to restore democracy in the conclusion of international treaties.

We want the government to be required to present to the House all international treaties and agreements it has signed, before ratifying them; to publish all international agreements by which it is bound; to allow the House to vote on and approve such agreements, following an analysis by a special committee tasked with examining international agreements and major treaties, before the government may ratify them; and, of course, to respect Quebec and provincial jurisdictions in the entire process of concluding treaties, that is at the negotiation, signing and ratification stages.

While the provinces are usually informed of negotiations relating to trade agreements, in reality they have little say in the process, except on rare occasions; they are completely excluded from the decision-making process.

Now, democracy is totally absent when it comes to international treaties. There is no complete list of treaties. The government releases them sporadically. We do not know when it will release them, or even if it will release all of them, because it is not bound to do so. Even the Department of Foreign Affairs' treaty branch does not have a list or report that we could consult to find out with whom, when and why the government signed this or that treaty.

Nor is the government required to table these documents in the House. In fact, it is not even required to inform the House or the public when it signs or ratifies treaties.

The House does not approve them. As we mentioned earlier, the government can sign and ratify treaties, it can do anything it wants without consulting the public's representatives. At best, if ratification of a treaty requires changes to the legislation, Parliament will be asked to vote on such legislation. Incidentally, since 2002, in Quebec, the National Assembly must vote on these measures.

Since the House is in no way involved in the process for concluding treaties, it cannot consult the public. This is really pushing the denial of democracy, especially since, as some colleagues mentioned, these types of treaties affect everyone in their everyday lives.

The government is not required to consult the provinces either. The government prevents the provinces from acting internationally by controlling their international relations and not permitting them to conclude agreements that are considered treaties.

This is what is going on now. What is ironic is that Canada is less democratic than it was in the 1920s. In fact, in June 1926, Prime Minister King moved a motion, which was unanimously adopted by the House of Commons, which stated:

—before Her Majesty's Canadian ministers recommend ratification of a treaty or convention involving Canada...Canada's approval must be obtained—

That was 1926. This is 2008.

In 1941, Mackenzie King reiterated his commitment to this formula. To quote him once again:

With the exception of treaties of lesser importance or in cases of extreme urgency, the Senate and the House of Commons are invited to approve treaties, conventions and formal agreements before ratification by or on behalf of Canada—

Over the years, we have resorted less and less to approval by resolution. For example, during the cold war, the practice of obtaining Parliament's approval for signing treaties or for military intervention abroad was definitely abandoned. We even stopped tabling treaties in Parliament, with the exception of the Kyoto accord, which is more recent. No treaty has been approved by resolution since the 1966 Auto Pact, more than 40 years ago.

In the case of Kyoto, the government is refusing to respect what was voted in Parliament. I am laughing and sometimes we laugh about things that are not funny. That is the case here. It is the irony of the situation. Once again we could call this a denial of democracy.

In addition, if we compare ourselves to other countries, Canada is less democratic than the rest of the industrialized world. Parliamentarians in most of the other major industrialized democracies participate more fully in the approval of treaties. I will give a few examples: France, Germany, Denmark, Italy and even the United States are required, by their constitutions, to obtain legislative approval for at least certain types of international agreements before they are ratified. We still have a fair amount of work to do to establish a democracy that can deal properly with international agreements.

I referred earlier to bills introduced by the Bloc Québécois on three different occasions. And we will do it again. We have introduced a bill on treaties to modernize the whole process of entering into international treaties. The Bloc Québécois' bill on treaties was designed to enhance transparency and democracy when international treaties are negotiated and signed. Given that such treaties occupy an increasingly important place in the lives of our fellow citizens, a change in established practices was more important than ever.

In addition, the bill ensured that the legislative jurisdiction of the provinces was respected by the federal government. Understandably, we feel very strongly about that. The bill included five changes: the systematic tabling of treaties before the House of Commons, seeking the approval of the House for important treaties, consultation of civil society by a parliamentary committee before Parliament makes a decision on an important treaty, the publication of treaties in the Canada Gazette and on the Internet site of the Department of Foreign Affairs and, finally, the compulsory consultation of the provinces before any treaty on matters within provincial jurisdiction can be negotiated.

The bill on treaties made it to a vote only once, on September 28, 2005, but all federalist parties voted against it. Why? I will get to that. Never short of contradictions, the Conservatives made two promises with respect to international treaties in the last campaign. They promised to put international treaties to a vote in the House before ratifying them and to involve the provinces in the treaty process whenever treaties affected their jurisdictions. Both of these promises have been broken. Since they were elected, the Conservatives have amended NAFTA, signed two investment protection agreements modelled on chapter 11 of NAFTA, one of which was ratified, and entered into a military cooperation agreement allowing British soldiers to train in Canada. They have also signed cooperation agreements in the area of higher education, even though Ottawa does not have jurisdiction over higher education, entered into an agreement to facilitate technological transfers from Canada to China and amended the free trade agreement with Chile. With the exception of the amendment of the NATO treaty, on which we had a mini-debate and a vote at the last minute, none of these international treaties were submitted to this House.

I was saying earlier that the federalist parties had rejected the Bloc Québécois bill because of two clauses in particular, including clause 4, which established a mechanism for consulting the provinces. It would appear that when one belongs to a federalist party, even if they claim to be full of good intentions and that they want to remain open, and even if this is presented in an election campaign to the provinces and, more particularly, to Quebec, they seem to forget it all very quickly when the time comes to take action and to vote. Furthermore, clause 6 did not suit them. That clause recognized the validity of the Gérin-Lajoie doctrine.

In closing, the federalist parties rejected more than just a Bloc Québécois bill; they rejected a piece of Quebec legislation. In fact, section 22.1 of the Act respecting the Ministère des Relations internationales requires the Government of Quebec's consent, both at the signing and the ratification or adhesion of the Government of Canada, before the latter may act on the international scene in relation to any agreement that has to do with areas of Quebec jurisdiction accorded under the Constitution.

It should therefore come as no surprise that, with the federalist parties' rejection of this bill, more and more Quebeckers are becoming sovereignists and that we would tackle this issue again by presenting this kind of bill, which, unfortunately, clearly demonstrates to everyone that those parties are not at all open to Quebec.

[Penny Priddy, NDP, Surrey North, BC]

Mr. Speaker, if I had not been told earlier that the Bloc supported this motion, I would not have known that given the comments of the member. The member has raised legitimate concerns around the sporadic publication of treaties, the consulting of civil society, the impact on the lives of people and therefore it should be looked at more carefully. He has said that the Conservative words are not worth that much. Those comments to me do not sound particularly supportive of this treaty.

One of my other colleagues will have subsequent question, but my question for the member would be this. Given all those comments, which were primarily of concern, why then does the member support the bill?

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, I was very clear: we support Bill C-9. This bill has nothing to do with all the recriminations between the NDP and me. We must not mix apples and oranges. Canada can join a dispute resolution tribunal. That is what Bill C-9 is about. All the problems with bad agreements and NAFTA chapter 11 have nothing to do with Bill C-9. We are doing what 155 or 156 other countries who belong to this dispute resolution tribunal have done. Are we making a great improvement in our situation? I do not know, but it is still not a bad thing. That is why we support this bill.

All the other recriminations show that democracy is being denied when it comes to international agreements. This is not at all the same thing, and that is why we support this bill. That does not mean we believe that everything the government is doing with respect to international agreements is perfect.

On the contrary, I showed at the end of my speech that it is time to raise this issue again and introduce a bill ensuring that international treaties are voted on here in this House.

[Larry Bagnell, Liberal, Yukon, YT]

Mr. Speaker, could the member give a specific and concrete example of where a Canadian company was protected under some of these other provisions of international agreements or treaties, which he thought was undemocratic or unjustified?

I appreciate his support of the bill to help protect Canadian investors abroad, but he referred to problems with other types of provisions protecting investors that may not ultimately be democratic.

Could he give not a generality but a specific example of where a Canadian company was protected but he did not feel it was democratic or appropriate?

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, the example that comes to mind is not about a Canadian company, but the problem I mentioned earlier concerning chapter 11 of NAFTA. It is about an American company that wanted to set up in Mexico and create a large garbage dump. The municipality refused to let that company turn the city into a dumping ground. Under chapter 11 of NAFTA, the American company was able to take legal action against the municipality and it won.

The hardest hit are the poorest countries. A few hundred million dollars for countries and companies such as ours is perhaps not as serious as it would be for developing countries or small municipalities. We can see the problems that can arise.

Companies here need dispute settlement protection. It is crucial for investors to have some protection before investing, so that their investments do not grow without them seeing any profits. This is obvious.

This is perhaps a general answer to the question from the member for Yukon, but if he has specific examples, he is more than welcome to share them with us.

[Judy Wasylycia-Leis, NDP, Winnipeg North, MB]

Mr. Speaker, I would first like to thank the hon. Bloc Québécois member for his speech and for clarifying the Bloc's position. It is very interesting to try to understand the reasoning behind the Bloc Québécois' support for Bill C-9.

Perhaps one might better understand their position if one considers the fact that the Bloc decided to support the Conservative government's last budget, the lack of support for our activities concerning banks here in Canada, the hesitation on the part of Bloc Québécois members to join us in convincing the government that this is the wrong direction to take, and even the strategies regarding free trade or the action of banks right here in Canada. Canadians want us to take this direction in order to trigger major changes.

Here is my question for the Bloc Québécois member. Considering the lack of transparency, lack of accessibility and lack of responsibility concerning this bill, how can the Bloc Québécois support it? How can he justify this decision to all Canadians?

[André Bellavance, Bloc, Richmond—Arthabaska, QC]

Mr. Speaker, our party is often criticized for not doing anything and not changing anything, but the hon. member just said that we are practically responsible for the impending end of the world.

The Bloc Québécois always acts responsibly. As far as the last budget is concerned, I recall that all the parties in this House supported it. During the last vote, not a single NDP member stood up or said a word. The budget was passed unanimously. We are not interested in hearing any more about the last budget, especially since it was the Bloc that got $3.3 billion to resolve in part, but not entirely, the fiscal imbalance. That was a major battle Quebeckers wanted us to fight here in the House. In my riding, when I go to the grocery store, I am not embarrassed. I hold my head up high. People understand quite well the work we are doing here and they thank us for it.

To support a budget, tax measures or certain bills does not mean supporting a government. Where is the logic in that? I cannot imagine. The hon. member has been here longer than I have and there certainly have been times when she voted with the government. I remember the cozy relationship between her and the government of the Prime Minister's predecessor, the hon. member for LaSalle—Émard—he is still here, but we do not see him very often. This relationship between the NDP and the Liberals was right up front at the time and that did not mean that the NDP supported everything the Liberal government did. It did not support the sponsorship scandal or things like that.

We have to be consistent. Supporting this type of measure, whereby Canada becomes a member of a dispute settlement tribunal, does not necessarily mean supporting every Conservative government measure.

I even said from the outset in my speech that this government was insensitive about the manufacturing crisis and the forestry crisis. I am the agriculture critic for my party. I defend the beef and pork producers who are currently experiencing serious problems and I can assure my colleagues that this government is insensitive to their calls. The support we are giving the government today has nothing to do with all the Conservative government's bad policies.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, I am very pleased to speak today to this bill, the World Bank's investment tribunal, which is being brought forward to the House through the International Centre for the Settlement of Investment Disputes. It was set up in 1966. I guess it has been a bit of a late bloomer. Here we are 40 years later trying to actually give it some legitimacy.

I have listened to the debate and I find it interesting, but it is predicated on two fundamentally wrong principles.

The first is the principle that if we look at the failed processes that are in place now for trade, particularly the chapter 11 mechanisms for NAFTA, it has been proven time and time again that they allow certain corporate interests to override regional, state and national governments and the legitimate interests of governments to protect citizens in a fair manner. That has been used again and again as a blunt instrument to push a privatizing agenda against national interests. We are supposed to accept that this principle, which has failed again and again under chapter 11, will somehow be different with this tribunal, even though it is using basically all the same input mechanisms, and that things will somehow be better this time.

The second element in this discussion, which we are supposed to accept, is the tribunal, through the World Bank, is such an august body that it will have legitimacy in its own right. We are supposed to forget 40 years of the neo-liberal experience under the World Bank and the severe damage it has done in development.

Therefore, I will speak on practical issues of how trade disputes are actually dealt with in the real world so we can bring a bit of perspective to this debate.

I will begin with the World Bank's credibility. Certainly it has taken a number of hits because it was a dumping ground for Paul Wolfowitz, who is notorious now as one of the architects of the illegal war in Iraq. He was such a liability to even George W. Bush that the Americans could not figure a place to dump him to get his radioactive state out of Washington, so they sent him to the World Bank.

Under Wolfowitz's leadership, credibility of the World Bank was severely challenged. There was an element with his girlfriend and losing complete support of the directors of the World Bank around the entire world. Therefore, there was a coup to get this guy out. Here was a guy who even George W. Bush would not be seen beside representing the World Bank.

I refer members to a recent article in The Guardian that said we should end the hypocrisies on the World Bank because the fact was the World Bank's credibility was shot long before Paul Wolfowitz brought his girlfriend on the scene.

Naomi Klein has written extensively about the failings of the World Bank in terms of ensuring that when we do have trade pacts and we do have development deals, that communities and national economies are able to benefit from them. She writes:

First, let's dispense with the supposed hypocrisy problem. “Who wants to be lectured on corruption by someone telling them to ‘Do as I say, not as I do’?” asked one journalist. No one, of course. But that's a pretty good description of the game of one-way strip poker that is our global trade system, in which the United States and Europe—via the World Bank, the International Monetary Fund and the World Trade Organisation—tell the developing world: “You take down your trade barriers and we'll keep ours up”.

We can see that whether it is farm subsidies or any form of international trade. She goes on to say:

The more serious lie at the centre of the controversy is the implication that the World Bank was an institution that had impeccable ethical credentials—until, according to 42 former World Bank executives, its credibility was “fatally compromised” by Wolfowitz.

The truth is the bank's credibility was compromised long before Mr. Paul Wolfowitz. It was compromised when it forced school fees on students in Ghana in exchange for a loan, when it demanded that Tanzania privatize its water system, when it made telecom privatization a condition of aid for Hurricane Mitch relief and when it demanded labour “flexibility” in Sri Lanka in the aftermath of the Asian tsunami.

While the rest of the world was raising money in our schools, in Canada and around the world, to help the victims of the tsunami, the World Bank was putting the squeeze on Sri Lanka to break apart its national policies on protecting its own workers. The Paul Wolfowitz scandal pales in comparison to that.

On the issue of corruption and accountability, she says that the World Bank has absolutely no credibility to speak of because the World Bank was there when the Soviet Union was basically picked apart by an oligarch of mafia interests. We saw the role the World Bank played in Chile with, of course, Milton Friedman, the original doctor of shock and torture for the economy, and the incredible damage that was done to all segments of society in what was actually a very middle class country at that time until the World Bank was through with it.

The World Bank has a lot to answer for in terms of its credibility of being a fair arbiter, an honest policeman on the world stage. I think many people in developing countries have developed a very strong distaste for that. We need to have that in mind when we talk about any trade agreements that come before us in the House.

The issue of trade is paramount to us as a nation. We are a nation of traders and we want fair rules. In our farming sector we have come up against incredible odds because some of our major competitors, the EU and the U.S. , continually dump products on the international markets and continually distort the price of grains and other commodities through their subsidies. It has hurt us but it has had devastating effects in the third world where y the EU or the U.S. can dump grain, corn or any other product into the third world where farmers do not have nearly the same protections.

When we all talk about a level playing field, it seems that they are never on the level playing field. Who is on the level playing field? Well, it is the corporations and their friends, but national economies, especially in the third world, are not on any kind of level playing field.

If a trade agreement comes before this House, we need to look at it through the prism of asking whether it will be fair, just, true and open trade or whether it continues to perpetuate a very one-sided cycle. Unfortunately, I believe that this one-sided cycle will continue.

I would like to speak to a couple of examples. It was mentioned earlier in the House the example of Metalclad in Mexico where a U.S. company felt that its rights were unfairly impinged by the fact that in its desire to use a poor neighbourhood in Mexico as a toxic waste dumping ground somehow its rights were violated by the fact that the people of that region said that certain base standards needed to be set. They said that as a municipal government, a regional government and a national government they needed to protect their country from being a dumping ground for waste.

Metalclad took that through binding chapter 11 arbitration. Anybody who says that the chapter 11 arbitration process is in any way fair or open is deluding themselves. They would be smoking the kind of stuff that I know our Conservatives are certainly wanting to snuff out.

What happened in that Metalclad decision has been repeated in numerous decisions under NAFTA, chapter 11, where basic rights of a country to set certain levels of standard have been erased by a body that is unaccountable, unelected and sets its own standards, in fact it sounds very much like the Liberal dominated Senate, but it has the ability to do worse because there is no appeal mechanism under chapter 11.

We are seeing a very similar setup with this World Bank front in terms of its mechanisms. Chapter 11 does not have to release the results of its findings. It does not have to allow any third party briefs to be brought forward. The ability of a national government to protect its interests once it has gone to a chapter 11 challenge becomes very limited.

I would like to speak about my own interest in chapter 11. We have a situation right now where the taxpayers of Canada are on the hook for a potential $350 million in damages that is being heard at a secret tribunal, a chapter 11 of NAFTA. That is being brought forward by a company 1532382 Ontario Inc. This is a company that was founded in Ontario and its board of directors is listed as being in Don Mills, Ontario. The people on the board of directors are not known to the public because they get to hide behind corporate anonymity, but this numbered company is suing the Canadian public for $350 million, claiming that its international rights were violated.

I want to go through this story so people in the House and anyone watching back home will know how this kind of, as Naomi Klein said, one-way strip poker is played.

1532382 Ontario Inc. was incorporated in the province of Ontario to go after a municipal waste contract under provincial jurisdiction. That provincial waste contract was the 1995 original bid for picking up garbage for the City of Toronto. The solution being offered by 1532382 Ontario Inc. was to ship it up to northern Ontario to the riding of Timmins—James Bay, where we have these massive iron ore pits that are filling with groundwater, and dump the garbage for 20 or 30 years in the pits. The fact that 380 million litres of groundwater flows through those pits a year is not a problem for the planners of this dump because it was actually written into this scenario that they would use the groundwater to wash the garbage and they would get 20 years out of these pits. Three hundred and eighty million litres of groundwater would flow through for all of eternity as far as we know unless something dramatic changes in northern Ontario. The guarantee was that this numbered company with no name behind it would set up a commitment that for 2,000 years it would run pumps to wash the garbage, to take the groundwater and pump it back into the surrounding environment.

In fact, when the planners came before the Ontario government with this plan, they actually costed out the cost of fixing the pumps 1,500 to 1,600 years in the future. It was amazing. They figured it would cost them $25 an hour 1,600 years in the future. That is like Clovis and the Franks talking about what it would cost to run trucks on our roads back in A.D. 600. This shows how absurd this plan was.

This plan was so absurd that it would never have made it to first base until of course the Mike Harris government came in. My God, there are certain people here who were there at the time when Mike Harris stripped the environmental assessment laws. Since they knew a deal like this would never go through with scrutiny, they put it through the biggest waste management proposal in Canadian history through a scoped EA where they were able to omit all the questions about groundwater safety so that this dump could get passed. In fact, the only question that was allowed in the entire hearing was whether or not the numbers from the computer model matched. There was nothing about real time experience at these pits. These were badly fractured pits. People who lived underneath the pits can tell us about the problems with the water flowing through. The miners who worked in the pits knew the situation in the pits.

The Harris government thought this was a great deal because some of the people involved in 1532382 Ontario Inc. happened to be from the city of North Bay, which was the home base of Mike Harris. It almost came to fruition but the people of northern Ontario and the Abitibi region of Quebec came together and said that was enough. They said that they would not go through with a project that was so risky, so unproven and so potentially disastrous to the health of their region that it literally took railway and road blockades to get this government's attention that there were problems with this plant, problems that would have easily have been identified if we had a proper environmental assessment in process. The dump plant for the Adams mine fell through, which is no surprise. Sometimes really bad ideas do not fly.

The reason I mentioned that dump is because a very curious thing happened afterward. At the time, 1532382 Ontario Inc. was identified with Gordon McGuinty, a North Bay businessman. He had Notre Development. He had a number of investors and many of those investors were well known. Many of them were from various parts of Ontario. When he had a problem, after the deal fell through and waste management walked away, he was looking for partners for this dump, and this is where another number of investors came through. Some of those investors were also identified with the Conservative Party. People who identified names who were involved in this were all from Ontario.

I could name them here. I am not afraid to name them. Mr. Cortellucci was identified as someone who certainly seemed to have an interest in this mine. Of course it was all behind numbered companies, so how do we find out?

This Ontario numbered company actually donated money to the leadership bid of the present finance minister. This Ontario company gave donations to the Conservative Party. It was clearly based in Ontario and it was dealing with a municipal contract. After the Adams mine deal fell through, the company sued the present Ontario Liberal government for $300 million for the fact that it was robbed of its deal. That lawsuit went nowhere so we did not hear anything more about this numbered company until last year. It was not interested in going through the Canadian courts anymore. It was taking its case to chapter 11 of NAFTA. How is it that an Ontario company that is donating money to Ontario political officials dealing with a municipal waste contract can go to chapter 11 as an international investor?

Lo and behold, Vito Gallo, a man nobody has ever heard of, steps out of the wings and says that he is the sole owner of this mine. I asked the Toronto city councillors who were involved in the negotiations if they had ever heard of Vito Gallo. They had never heard of him. I had to tell them that he was suing the Canadian public for $350 million claiming that he owned the Adams mine and that his mine has gone up in smoke. I was involved in those negotiations with the Algonquin nation when I worked with them and we had never heard of this man. Now he has this deal and is going before chapter 11.

There will be no appeal at chapter 11. We have no right to bring forward briefs about who was involved and who the potential Canadian investors were. We do not have the ability to do that. The Canadian public is trusting three guys in Washington to dispense justice on $350 million. In any kind of fair deal, as in the case of taking this dispute to a Canadian court, there would be depositions from both sides, there would be witnesses and there would be cross examinations. We would squeeze the Charmin to see if this case had any legitimacy at all. That is what the courts are there to do.

In a large dispute where a large amount of money is involved and where a provincial or federal law is in question, that dispute must be brought forward to be tested to ensure there is full due diligence. That does not happen with chapter 11. We have seen it time and time again where even dispute resolutions do not need to be made public.

How can something be transparent and open when third party briefs are not allowed to be brought forward and there is no right to full legal representation? How can something be transparent and open when a panel of three get to decide and their word is law? There is no appeal and no challenge process. If anybody tells me that is good for the business of the nation then we are certainly not on the same political wave length. I believe that certain issues need to be brought forward before any of these kinds of decisions are allowed.

This brings me to the World Bank's investment tribunal. I think we are dealing with many of the similar concerns that we saw with NAFTA's chapter 11. We have not seen that anyone has learned anything from chapter 11 about making these deals more open and more fair. In fact, this really seems to be just another way for the government and its friends in the Liberal Party to resurrect the multilateral investment treaty. When that treaty was brought to the public's attention, Canadians said that there were issues of national sovereignty and our economy that they were not going to give away to some arbitrary, unaccountable, unelected body to make binding decisions. That simply undermines our national sovereignty. There was a national response against the multilateral investment treaty. I know that certain people from certain ideological stripes felt the pain of losing that.

Under article 52, an annulment of this decision may only be allowed if:

(a) that the Tribunal was not properly constituted;

(b) that the Tribunal has manifestly exceeded its powers;

(c) that there was corruption on the part of a member of the Tribunal;

(d) that there has been a serious departure from a fundamental rule of procedure; or

(e) that the--

[The Acting Speaker, Royal Galipeau]

Questions and comments, the hon. Parliamentary Secretary to the Minister of Public Works and Government Services.

[James Moore, Conservative, Parliamentary Secretary to the Minister of Public Works and Government Services and for the Pacific Gateway and the Vancouver-Whistler Olympics]

Mr. Speaker, I listened intently to the speech given by my colleague from Timmins—James Bay. I know he used to be the trade critic for the NDP, I believe, in the previous Parliament.

[Charlie Angus, NDP, Timmins—James Bay, ON]

No, agriculture.

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

Agriculture, I beg your pardon, Mr. Speaker.

The hon. member spoke for a good length about chapter 11 of NAFTA. It is remarkable to me. First, I was frankly a little bit disappointed by his speech. I think one can make a point for or against something without personal attacks, being negative, smearing Paul Wolfowitz, smearing people's intentions and attacking their character. One can make the point against chapter 11 without having to attack someone's personality and character. It is entirely unnecessary and it is unbecoming in this place.

Beyond that, chapter 11 of NAFTA extends the Canadian value internationally. What chapter 11 says in NAFTA is that we cannot discriminate against a foreign owned company.

The hon. member used the example of Metalclad. What chapter 11 says is that if a municipal, provincial or federal government in Canada or any jurisdiction in the world wants to regulate or legislate against certain behaviours by any companies, say one which is dumping pollutants that may be detrimental to an environment, a government can say that companies cannot dump this pollutant.

It cannot say that company A cannot dump the pollutant. It has to say that all companies have to stop dumping this pollutant. The reason why is because countries very often use regulations and laws to discriminate against one company in favour of another. Chapter 11 means that we have to treat all companies equally, not discriminate, and thereby allow companies to change their practices in order to meet the new burden in the best interests of the public. It forces countries not to discriminate. That is what chapter 11 does.

The hon. member says that this allows companies to sue governments in order to change laws. Yes, it does. In Canada, a foreign company can sue the Canadian government or any government if it is being discriminated against. It could do that before chapter 11. Chapter 11 allows a Canadian company to sue a government in another jurisdiction so that it gets treated equally and so that it is not discriminated against. That is what chapter 11 does.

The hon. member says that a company can sue a government and overturn a law. Yes, because it is being discriminated against to benefit another company that may be domestically based. It is a trade barrier. It prevents competition. Preventing competition prevents people from getting the best quality, the best price and the best choices in products, and how they want to live their lives. That is a good thing.

The principles of chapter 11 exist in Canada whether we have NAFTA or not. NAFTA and chapter 11 of NAFTA extends this virtue abroad because it protects Canadian companies in other countries so that we can do business and not be discriminated against.

I cannot believe that a member can stand up in the House for 20 minutes and give a speech on something he clearly knows so little about.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, I was quite surprised. I was not sure if my smear was that Wolfowitz had been corrupt or that he had engineered an illegal war, but I know I have certainly touched a soft spot with my Conservative friend and I am not surprised he is up defending chapter 11 so blindly. That is part of the ideological problem in the House.

I spoke about the specific issues of how chapter 11 is used again and again to basically undermine laws. He talks about how it gives us rights, but we have these rights before courts with our U.S. trading partners.

This takes away our rights, so that again we can have a numbered company constituted in Ontario that can suddenly claim it is American to take that outside the courts, to take that outside of a tribunal that is open, transparent and actually allows for briefs and counterclaims to be made, and gives it to three trade negotiators whose word is final.

If the hon. member thinks that is democratic, it is probably in keeping with the direction in which the Conservative government is going. However, the New Democratic Party certainly does not think that is democratic in any way and we certainly do not think it is in the interests of the Canadian public.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I thank my colleague from Timmins for providing some light on this subject because clearly after what we just heard, a lot of light is needed.

In fact, it was interesting in the deliberations at committee that there was reference to NAFTA and chapter 11. There was talk about NAFTA and chapter 11 with Canada and even the FTA with Chile. Most of our bilateral foreign investment protection agreements, the FIPAs, and this agreement are kind of at parallel purposes but the thing that is similar is what they do in terms of who gets to be heard.

The dispute settlement option that can be chosen by investors is in both the state of the investor and the host state of the investor, and their party to this agreement. What is fascinating, however, and that is to discern between these two kind of formats, the chapter 11 method and the method that we are describing today, is the transparency. What we do not get from the government is a clear indication of where the transparency is.

If we look at the trade agreements that have been passed and where the deals are done, given that Canadians I think value more than anything transparency and accountability, why does the member think that this particular arrangement is going through so quickly? It has been around since 1966 and all of a sudden there is a need to have this in place.

The previous Liberal governments, the Liberals are now supporting it, did not think it was something they needed to do but now they think it is the greatest thing. The current government thinks it is something that we have to have. In his opinion, why does the member think we are having to rush this thing through? What are Canadians going to benefit from it?

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, I was asking myself, given that the panel has been around for 40 years, why is there a rush now? Why are we suddenly at a great trade disadvantage.

I think the answer was actually given to us just a few minutes ago by my Conservative colleague. At the beginning of my speech I said the whole scheme is predicated on two suppositions. One is that we believe that the World Bank is somehow an arbiter of international credibility and second, that we believe that chapter 11 and all its failings somehow will be transformed into a bonus to help average Canadians.

What we have seen with the Conservative response is that those members have their knickers in a knot over comments about Paul Wolfowitz. So clearly, we are at a distinct disagreement about what the World Bank's role is and second, we are being told, in fact to our face, chapter 11 is great.

If a corporation wants to go dump toxic waste in Mexico the corporation's right should be protected. If we want to go after a country that is trying to stop toxic chemicals being sprayed on lawns, we should be protected. If we want to go after a government in Canada to stop medically harmful additives in gasoline and we are corporate investors, we should be protected.

As for the rest of folks back home, they can just sit back and lump it. That is the Conservative vision that is actually being backed by the Liberals. And our friends in the Bloc seem to be saying, as long as they can sign onto the treaty, the Parti Québécois will sign on to anything.

However, folks back home will understand that a trade deal that takes away the ability of the public to participate, that takes away legal precedent in the country to examine and cross-examine, and a trade agreement that takes away any ability for appeal is not in the interests of folks back home, average people and neither is it in the interest of our sovereignty as a nation.

[Penny Priddy, NDP, Surrey North, BC]

Mr. Speaker, the fact is that there is no means by which a sovereign state, in which an investment is being made, can make an appeal on behalf of its citizens. I wonder about my colleague's comment about the Conservative member who earlier talked about protecting companies not being allowed to invest in some countries and that it would be discriminatory. On the other hand, there could be discrimination against all the citizens who live there--

[The Acting Speaker, Royal Galipeau]

The hon. member for Timmins--James Bay, a 30 second response.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, clearly look at the track record of the World Bank. Who has it targeted? It targeted for relief after hurricane Mitch, privatizing Telecom, and it has gone after privatizing water systems in places like Tunisia. This is what it sees as its role in trade.

That is obviously the opposite of what we see in trade and so we will stand against the bill, continue to fight against the bill, and work with non-governmental organizations that are looking to bring some democratic reform to these trade agreements.

[John Maloney, Liberal, Welland, ON]

Mr. Speaker, I stand to speak today to Bill C-9, An Act to implement the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention).

This bill implements the international convention on the settlement of international disputes between states and nationals of other states which was open for signature in Washington back on March 18, 1965. It generally creates a set of rules for mutually agreed upon arbitration hearings between investors and foreign state governments. It ensures that the courts in any of the signatory countries have the legal means to enforce any decisions in the ICSID hearings.

As a trading nation, Canada and Canadian and international investors require protection, stability and confidence. Should disputes arise, and they do, it is essential that fair, equitable and judicious treatment is available when necessary.

The ICSID convention is an international instrument sponsored by the World Bank to facilitate and increase the flow of cross-border investment. The convention establishes a mechanism to resolve investment disputes between foreign investors and the host state in which they have made their investment.

The ICSID convention entered into force, as I said, on October 14, 1966 and my understanding is that 156 countries have signed the agreement with Canada signing on December 15, 2006. As of January 2007, 143 states have ratified the convention, making it one of the most ratified instruments in the world. The majority of Canada's trading partners are party to the convention.

Investment disputes brought under the convention are administered by the international center for settlement of investment disputes located in Washington, D.C. In the last few years the activity of the centre has soared due to increased flows of cross-border investment and the number of investment treaties referred to ICSID arbitration.

While the centre had over 110 arbitrations in total during the first 40 years of its existence, there are currently 105 proceedings underway. Since its inception, the centre has established itself as a reliable and effective organization for resolving investment disputes.

Once ratified the convention will provide additional protection to Canadian investors abroad by allowing them to include in their contracts with foreign states the option of arbitration under ICSID convention. In addition Canadian investors doing business in the country with which Canada has a foreign investment promotion and protection agreement will have recourse to ICSID arbitration for violations of that agreement as well.

Becoming a party to the ICSID convention will also make Canada a more attractive destination for international investors and that will mean jobs for Canadians.

The most significant advantage of the convention is the enforcement of arbitral awards. Unlike awards issued by other arbitral institutions, domestic courts cannot refuse to enforce decisions issued under the ICSID convention. Rather, such awards are enforceable in any country that has ratified the convention as if they were a final judgments of the courts in that state.

The tremendous growth in investment and investment-stated disputes has made Canada's failure to ratify ICSID the focus of attention by Canadian business, the Canadian legal community and our trading partners. As I have indicated, to date 143 states have ratified the ICSID convention. The majority of our major trading partners are parties to it except for Mexico, India and Brazil. Ratifying the ICSID would bring Canadian policy into line with our OECD partners.

In a survey conducted by the ICSID centre in 2004, 79% of the respondents said ICSID plays a vital role in their country's legal framework and 61% said ICSID membership has contributed to a positive investment climate. Those are significant numbers.

The ICSID regime provides several important advantages, and compared to other arbitration mechanisms, the ICSID regime provides better guarantees regarding enforcement of awards and more limited local court intervention. Any arbitral award rendered under the auspices of ICSID is binding and any resulting pecuniary obligation must be enforced as if the award were a final domestic court judgment.

Moreover, all ICSID contracting states, whether or not parties to the dispute, are required by the convention to recognize and to enforce ICSID arbitral awards. Investors often prefer to rely on such arbitrations rather than on local courts of the country whose measures are in dispute to ensure an independent resolution of the dispute.

ICSID's relationship to the World Bank assists investors in obtaining compliance with ICSID awards and its roster of arbitrators gives investors access to well-qualified arbitrators at ICSID controlled rates, with extensive experience in international investments arbitration. ICSID also provides important institutional support for litigants.

The ICSID convention is a well-known tool for the settlement of investment disputes. Therefore, the interpretation of the convention and its usefulness are predictable.

Canada already has numerous links with ICSID. Provisions consenting to ICSID arbitration are commonly found in contracts between governments of other countries and Canadian investors. The NAFTA in chapter 11, the Canada-Chile free trade agreement, and most of our bilateral foreign investment protection agreements, or FIPAs, provide for ICSID as a dispute settlement option that can be chosen by an investor if both the state of the investor and the host state for the investor are parties to the ICSID.

Obviously Canada must become a party to the ICSID because Canada and Canadian investors cannot benefit from the choice if Canada is not a member. This is an increasingly important problem. Within Canada the use of ICSID would be consistent with the policy of supporting the use of the alternative dispute resolution mechanisms for investor-state disputes. While ICSID is less expensive and more efficient than current alternatives, it is not expected to lead to increased litigation against the government.

Under a government whose recent record is one of stifling international participation by Canadian companies, it is important that we pass a bill that protects the rights of our investors in other jurisdictions. With hugely increased trade with emerging giants, such as China, and other countries with governance structures much different from our own, it is important, in fact it is essential, that Canada be a part of the international convention on the enforcement of investors' rights.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, it is interesting to note the member's comments about where the dispute would be settled. The crux of our concern is that this will take away the decision making from what it used to be or exists now, a dispute resolution within the confines of our own borders, and transfer it to the World Bank. Some would say that is fine and I would concur if there was some measure of transparency that we would all agree with. Earlier in his comments with one of his colleagues, he assured us that was the case, that as of April 2006 there is absolute transparency. But that is not the case. I quoted from the blues in committee where it was brought forward in witness evidence that it is not the case that it would have absolute transparency. It is contingent. The problem with this process is that there are so many contingencies. It is contingent when a tribunal is put together.

What happens if someone wants to appeal? We learn in this agreement that the appeal process is not something we would expect in Canada in terms of being able to appeal a decision of a court. He intimated in his comments that the decisions are final, that everyone has to abide by the decisions and that is it.

When we talk about the transfer of decision making, a lack of accountability, as I have already mentioned, or these contingencies and we underline the fact that there are countries presently that are not signatories to this, the question is what is the benefit for everyday Canadians. What would Canadians really get from this deal? The answer is not a lot, and what they get is a lot of questions.

In light of the fact that we are handing over decision making to a third party, in this case the World Bank, in light of the fact that all decisions are not fully transparent and in light of the fact that we are depending on a tribunal in Washington without the ability to make decisions in Canada, how can the member support this bill?

[John Maloney, Liberal, Welland, ON]

Mr. Speaker, I would point out that this is an option. Companies have the right to use this possibility, or they could sue within the country where the situation happened. There is a right of appeal. Other members have pointed out section 52, and perhaps on some very narrow grounds, a creative litigant could probably amplify those grounds.

The business community today wants an answer and it wants it quickly. Businesses are not about to be ground into submission after 10 years of litigation at a huge cost. They are prepared to use this procedure to get a quick and efficient decision and one that is enforceable.

Admittedly, not all countries around the globe are signatories to this agreement, but I suggest this will change as more and more people sign on and more and more ratification takes place.

[Penny Priddy, NDP, Surrey North, BC]

Mr. Speaker, I wonder if the member could speak briefly, or extensively as he wishes, about article 71 which is about the termination of contracts. Perhaps he could speak to why he sees that as being helpful and how that would work.

[John Maloney, Liberal, Welland, ON]

Mr. Speaker, I would like to review article 71 which states, “any contracting state may denounce this convention by written notice to the depository of this convention. The denunciation shall take effect six months after receipt of such notice”.

If things do not work as we anticipate they will, if it is not a positive outcome in becoming a signatory and having it ratified, then we have the ability to opt out. There is an escape mechanism which is very prudent and very beneficial, but I would anticipate that this country would not exercise its rights under article 71.

[Judy Wasylycia-Leis, NDP, Winnipeg North, MB]

Mr. Speaker, it should not come as a surprise to any of us that the Liberals are so enamoured with Bill C-9. The bill has all kinds of flaws, dutifully pointed out by many in the House and by organizations which are expert in this whole area. It comes as no surprise given the fact that it was the Liberals who tried to slip through Parliament and into public policy the multilateral agreement on investment. Thank goodness there were Canadians who said it was dangerous and problematic. Thank heavens there was enough pressure to bear to stop the MAI.

Today we have this proposition before us through Bill C-9 which has problems of the same nature that we identified with respect to the MAI. We also have on our plates the SPP, the security and prosperity partnership agreement, which evokes all kinds of images about lack of transparency and accountability, executive power and power by the international corporate elite.

Is there a pattern here? If the Liberals were in support of the MAI, and in fact they propelled the issue of the multilateral agreement on investment onto the public agenda, if they are in support of Bill C-9, which is clearly problematic in terms of the power of the World Bank, are they also in favour of the SPP?

[John Maloney, Liberal, Welland, ON]

Mr. Speaker, I certainly respect my colleague's comments on the Liberals' position on the MAI. The Liberal Party is always open to suggestions and constructive comments. Following a review of the possibility of entering into it, they withdrew it and that was a good move.

To suggest that the ratification of this agreement is the same as the MAI, I would suggest it is not. I look at the business community and the trading community, all of whom are very supportive of this agreement. I would suggest that if the worker on the street or in the factory were given the option, if he had the choice between arbitrating disputes under this agreement or not having a job, he would welcome the assurance of stability in his employment and would also endorse it.

[Larry Bagnell, Liberal, Yukon, YT]

Mr. Speaker, given what the member said, that we do not want Canadian companies to be prejudiced overseas when they invest, does he believe that can create a lot of jobs in Canada? Obviously Canada has investments around the world which create jobs and he would like to give some certainty through this mechanism so that a lot of union jobs and other jobs are maintained in Canada and not lost by some frivolous action against which there was no protection.

[John Maloney, Liberal, Welland, ON]

Mr. Speaker, job creation and job maintenance are so important for this country. It is certainly one of the issues of the day. It is my position that this would provide for stability and would provide new jobs. We are a trading nation. It would also protect existing jobs. As such, we should be endorsing this unanimously, all the parties in this House.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, it is interesting to note that we have heard the positions of all the parties on this bill and our party has taken the view that this bill is not up to speed on where Canadians are at and on how to protect Canadians in terms of investments, institutionally speaking.

I would concur with those who say it is not the end of the world if this treaty goes through, that other countries have passed it and therefore it is just something we can go ahead and agree to, no problem, thanks very much. I would agree that it would not be the end of Canada as we know it. It would not wreck or destroy our economy.

Let me start off with those measured comments, but we need to be very vigilant on what we are actually deciding and what potential pitfalls there are. If we look at the International Centre for Settlement of Investment Disputes, we will see that it is one of those groups within the World Bank that is not very well known. If we were to ask our constituents about it, or if I went out here on Bank Street and asked people if they were aware of the ICSID, most of them might look at you quizzically.

There is a reason for that. It is an investor dispute mechanism that provides multinational corporations with powers to sue governments when they impose domestic laws or regulations that have a significant detrimental effect on corporate profit-making. In other words, what is critical here is to understand why this is in place. Who does it benefit? Then it comes back to us as legislators. What does it do for everyday people?

I would submit that this is something that benefits multinational corporations and large investors, but I cannot make the argument that this benefits everyday Canadians. In fact, it has the potential to see us give up our sovereignty. I say that because this arrangement agreement has been around, as has been mentioned already, for more than 40 years, but it seems we now have a rush to sign on to this.

I find that a little strange. It is of concern to me when we see a major sell-off of resources, particularly here in Canada, a major sell-off of our resources, of companies that have been Canadian from the beginning, we might say, and certainly companies that have been around for more than 20 or 30 years, and we note that there is not a problem in terms of foreign investment in Canada.

The dilemma we have is in making sure that we have some hold on the economic reins, that we in fact get to determine our financial pathway, that we are able to have an economy that is a mixed economy for sure, a pluralistic economy absolutely, but one in which there is a balance.

When we take a look at this agreement, we see that what this agreement will do is allow multinational corporations powers to sue governments when they believe they have been wronged. We have already heard some examples from my colleague from Timmins about the perils of that.

We know that the World Bank organized the international body in 1966. Historically, capital-exporting countries have used a variety of these kinds of carrots and sticks to protect the economic interests of their major corporations abroad. They use these as a vehicle, as a tool, so to speak. If they cannot get what they want in a forum that is agreed upon between states, they use this forum.

While many might say it is fine, that if we look at some of the decisions we can see that they were amicable and there were no problems, we also have to take a look at the potential for this to be a negative situation for Canadians and, for that matter, for Canadian investors.

For instance, the United States has a long history of using these kinds of tools to its benefit, so we have to take a look at how the mechanism works. What we find is that in the way the tribunal is set up, we have what I think is really an imbalance in the structure. We know that the way the panellists are chosen and put forward is that they are agreed upon by members of the treaty. That sounds fine until we get to the point of asking this question: what if there is a problem with a decision that has been made by the tribunal?

We know there is no satisfactory appeal process, not in my opinion. The decisions are pretty final once they are made, once we have entered into the process. If someone thinks that a decision was not fair or that not all the evidence was brought forward, unless it can be proven there was corruption or unless there is a smoking gun, an appeal is not permitted.

In fact, let us look at article 52. To be clear, the appeal process is actually an annulment. It says to get rid of the whole decision. That is really not an appeal in my books. Article 52 lays out the annulment. It kind of reminds me of how the Catholic church dealt with marriages at one time, when a divorce would not be recognized but there would be an annulment, meaning the marriage did not happen.

However, the annulment may be permitted only if the following criteria are met. One is that “the Tribunal was not properly constituted”, but one agrees to the tribunal from the get-go so one would have to prove that somehow one did not agree. Another is that “the Tribunal has manifestly exceeded its powers”, but if one agrees to the agreement, one agrees to the powers and the decision-making. That one would be hard to prove.

Another is that “there was corruption” on the tribunal. My colleague from Timmins pointed out the problems the World Bank has had in that area. I am not sure that the tribunal would have a very non-jaundiced view of its own operations and it is the tribunal that would determine this. Another is that there was a breach in the rules of procedure. That would be when one filed and what time periods were involved.

The final criteria is that the award “has failed to state the reasons on which it is based”. We are talking about agreements that are in the millions and tens of millions of dollars. It would be very unusual to have an award that would not state the reasons on which it was based. Both sides have lawyers, if not teams of lawyers, who certainly would have provided the reasons why they were in the dispute.

Therefore, what we have here in article 52 is a train to nowhere. It is not an appeal process. It is an annulment process. It does not allow a window on the decision-making and therefore I think is a flaw. It is very difficult for anyone to be able to challenge things. We know that about four countries now are trying to get out of this agreement, but it is very difficult.

I will mention one of the reasons why it is difficult. If I may turn to article 71, in terms of being able to get out of this agreement it sounds good, in that one gives notice and gets out of the agreement. The problem is that we can have companies and corporations that have in fact signed on to these agreements and will tell their respective governments that if they pull out of an agreement it will harm them and there will probably be some legal action from those corporations against their very own governments. Sometimes this can mean corporations that are not centred in their respective countries but have business in those countries.

What does that mean? It means that notwithstanding the fact that article 71 allows a nation-state to withdraw from the agreement, it is much more difficult than that. This is not unusual. We know that with some of the trade agreements we have signed on to it is one thing to see there is an escape clause to get out of an agreement that we do not believe is in our best interests, which is easily stated in an agreement, but it is another thing to actually do.

Why? Simply put, when we get into these trade agreements, they become intertwined. Corporations do their business based on those agreements. If they feel they will lose out, it is their right to take their respective governments to court. It is important to note that and to note as well that there are nation-states right now that are trying to withdraw from this treaty and are encountering challenges and difficulties.

It is important to note that this is not in isolation. Recently the government built on the work that was done by the previous government on the Security and Prosperity Partnership of North America. As I said at the beginning of my remarks, I am not suggesting that this treaty will be the end of our country or that we will be giving up all of our sovereignty, but--and I underline “but”--it is one of the threads that is undoing the fabric that we have to be a sovereign state, to decide how investment is done and certainly how to challenge when unfair investment is taking place.

I would say the same with the security and prosperity partnership. It was really interesting when the previous government brought forward the security and prosperity partnership. The Liberals said it was something they had to do to streamline procedures and processes and we should not worry. They said we should just trust them because it was something that would be good for Canadians.

Most recently we have seen that partnership extended when the SPP talks were held not far from here with Mexico, the United States and Canada. What is disturbing about that agreement and also this particular treaty is that most Canadians are unaware of what the consequences will be for them.

When people talk about the security and prosperity partnership, they always say that it is a very dense kind of document, the little bit that is available, and they ask why it is something they should be concerned about. I simply ask them if they are concerned about what is on their table. Who decides the regulations around pesticide residue? Who decides the degree to which additives are put into our food supply and what kinds? Who decides what kinds of security arrangements we have at our border? If we are concerned about those things, we should be concerned about the security and prosperity partnership.

The Liberals said they just wanted to streamline procedures and regulations. This government says the same thing. Why would they be concerned about bringing these changes in procedure to this place, to Parliament, to allow Canadians, through their members of Parliament, to understand what they are?

It is a matter of how we think government should work. Is this something that governments should have a role in? Should they decide, in an open forum, how food quality and security arrangement procedures are done? Should that be done in the full light of day or should it be done behind closed doors? If we believe the previous government and this government, they have said that we elected them to do that, that we should just trust them and just not worry about it.

When we look at this particular treaty and some of its pitfalls and at the security and prosperity partnership and the lack of transparency there, we come to the conclusion that our governments simply do not want to share this information with Canadians. As I mentioned, in this particular treaty there are problems in article 52. There are also problems in article 71.

We also have to evaluate what it is that Canadians are going to receive from this. When I asked at committee what benefits would accrue to Canadians, even those who were supportive of the treaty said it was something that would actually help business. That is fine. That is good. We want to have a healthy business sector, as I mentioned before, and a mixed economy, one that creates investment opportunities. However, I asked one of the witnesses if this is something we are lacking right now, as a result of which we are not receiving investments, and the answer was clearly no. It is not something we need to have in any way, shape or form to entice people to invest in Canada.

People have probably noted, by looking at the business pages of late, two things. One is the manufacturing jobs, which have been the foundation of many of our communities, are falling apart. They are basically bankrupt or are going down the highway. The other thing people will note is that the businesses doing well are the ones that are taking our resources, be it bitumen and the oil sands or natural resources on the west coast, forestry, et cetera, but not having that value added.

We are not getting the kind of investment that would help those in our cities, town and villages to build a better life and a better community. Why? I think it is because the government is more focused on standing up for corporations and streamlining things for them. Let us be honest about it, the government is not really concerned about the investments that go to help in the communities, villages, towns and cities across the country.

I give the forestry sector as an example. This will not help the forestry sector in any way, shape or form. The $14 billion in tax cuts, the great tax cut swindle this past fall, will not guarantee key investments in the forestry sector or in the auto sector. In fact, we are waiting on the government to give some sense that it is there to help everyday Canadians, but it has said only if we pass its budget.

These kinds of treaties, the SPP kind of process, are a clear indication to Canadians of where the present government, the previous government and opposition parties stand on this bill. The government is more concerned about making sure things are nice and streamlined, thanks very much, for multinational corporations. However, when it comes to the person who gets up every morning, goes to work, does his or her best, contributes and builds through the individual's community, the government says sorry that is does not have much for them.

Ask people who have been laid off in the forestry and manufacturing industries. There is nothing there for them. All they have been given is a cent off the GST. That is great. I am sure they are very thankful of their government for that.

When we look at the cost benefits of the bill and what the government has done for working families and everyday Canadians, one has to say not much. By changing the dynamics and how we settle investment disputes through the international tribunal process on lawsuits by foreign investors against governments over alleged violations and protections, Canadians understand whose side the government is on, and I guess we can now say the Bloc and the Liberals, and who is on the side of Canadians.

I think most Canadians would want their government to say that in the area of investment dispute settlement what should matter is how it benefits citizens. I can guarantee that by passing the bill, we will be telling corporations that they now have a nice, streamlined procedure so if they need to sue someone, it is no problem, not to worry, to be happy. They will be happy. We heard it in committee.

What I have not heard from government or opposition members is that old adage of what is in it for us, the “us” meaning Canadians. I can say there is not a lot. What seems to be there for everyday Canadians is essentially taking our accountability mechanisms and outsourcing them, in this case to the World Bank.

I will end where I began. This is not the end of our country and giving up all our sovereignty, but it is a very disturbing thread that we have seen from the present government and the previous government. When we add it up with the SPP and some of these trade agreements, what it tells Canadians is that the government is on the side of multinational corporations, that it is there for them. We saw it with the government's budget and we see it with this bill.

[Larry Bagnell, Liberal, Yukon, YT]

Mr. Speaker, I have a quick question for the record. I think the member mentioned that four countries were trying to get out of this agreement. Could he list those countries so we have it on the record?

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, as of last April, Central America, South America, Nicaragua, Bolivia and Venezuela have given notice that they are trying to withdraw. There is one more and I apologize to my colleague, but I will get that to him.

As I said, this is not easy. We have concerns. Notwithstanding section 71 in the treaty, which says a country can withdraw, give notice, some of these countries and other commentators have suggested it is not only a matter of giving notice. They have to understand the implications and the blow back from corporations because they have invested so much in themselves to use as a mechanism. They could go after governments if they decided to pull out.

It is a matter of saying yes. Section 71 says countries can withdraw. I simply was noting that to say it was not as easy as just giving notice.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Mr. Speaker, I listened with great interest to my hon. colleague. On the issue of the credibility of the World Bank, we are here to rubber stamp this forum, yet the World Bank has caused damage on the international stage by its use of backroom trade pressure to undermine legitimate decisions by national sovereign governments.

I point to 2005 when Ecuador had part of its $100 million loan held back by the World Bank in punishment because it had the audacity to spend some of its own money on health and education. The World Bank thought that was an egregious abuse of the rights of investors, of people who were looking for this global race to the bottom. The World Bank has been the bully boy. It has destroyed good attempts at development by national sovereign governments.

Suddenly we in the House are supposed to accept the principle that the World Bank will arbitrate in a fair and open manner. It will not be open because dispute mechanisms will only be made public if both parties agree. There will only be binding third party briefs if both parties agree and it will be completely separate from any appeal process.

Does my hon. colleague not think it is a bit rich that at this time in our history with, for example, Naomi Klein's book The Shock Doctrine and with the incredible disgrace of Paul Wolfowitz, a good friend of the Conservative Party that has already risen to his reputation, we are now being told the World Bank is somehow an august, credible body in terms of international trade and fairness?

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, I thank my colleague from Timmins for his point which needs to be underlined. The question is, whose side is being represented here?

One of the things that I did not include in my comments is that the ICSID administrative council meets each year in the fall, which is at the same time as the World Bank gets together and the IMF has its annual meeting. The council is chaired by the president of the World Bank.

I watched the sad saga of Mr. Wolfowitz, the person who came in to say that he would clean up the corruption that was rampant in the World Bank. It was strange and bizarre to watch Mr. Wolfowitz trying to in some way explain himself and what he was doing when he hired one his friends and got her a contract. It was shameless.

Here we have a matter of being told to trust them. Why should Canadians put their trust in an institution like the World Bank which has had problems in deciding who is in charge? When someone was found to be corrupt, it had a hard time getting rid of him.

I would suggest that Canadians would be better served dealing with things here in our own jurisdiction and, until the World Bank can get its act together, that we do not go that route, that we keep things here as much as we can. We cannot always do it but in this case we are being offered that.

I have one final thing to mention which might be interesting to my friends from Alberta. Why is Alberta not signing on to this? Maybe Alberta has received some intelligence from Washington that this is not something it wants to get into because it might hurt the oil industry in some way if it were to submit its sovereignty to Washington. I do not know if that is the case but it would be interesting for my colleagues, if they have a chance, to answer the question of why Alberta is one of the provinces that does not want to sign on to this protocol.

[Judy Wasylycia-Leis, NDP, Winnipeg North, MB]

Mr. Speaker, I appreciated listening to my colleague's comments on Bill C-9. He made an interesting point, which is that this bill on its own may not threaten Canadian sovereignty and may not lead to disaster but it is part of a pattern. The cumulative effect of these kinds of decisions is what is worrying Canadians and what is worrying other countries.

I want to ask the member specifically about the impact of this approach as we see in Bill C-9 on some third world countries, keeping in mind that this whole initiative is around helping developing nations, and specifically with respect to the role of the ICSID in challenging South Africa's affirmative action policies and the role of ICSID in the economies of Nicaragua, Bolivia and Venezuela, making them withdraw from the ICSID. We are talking about something bigger than has been suggested by the Conservatives, the Liberals and the Bloc, all of whom seem to support this approach. We are talking about some worrisome patterns. I would like the member to comment on that aspect.

[Paul Dewar, NDP, Ottawa Centre, ON]

Mr. Speaker, my colleague is right in saying there are problems with it in terms of those countries which are trying to withdraw. The irony is that initially this was to be an arrangement that was to benefit countries in the southern hemisphere. After World War II and Breton Woods, and the setting up of the IMF, the World Bank was supposed to do the same thing.

I do not want to leave people with the impression that the New Democratic Party does not support the idea of these institutions. The problem is what happened to these institutions. The problem is they are not working for people.

Fundamentally the difference we have with the other parties is we believe that these institutions, in fact government itself, should be working for people and not the other way around. Instead, what has happened over a period of time is that these institutions have been tailored not to help people, but they have put corporations ahead. It is very interesting in international law when we look at the rights of people versus the rights of corporations. Corporations are trumping people time and time again. The effects are devastating. They are anti-democratic.

Instead of saying we believe in these institutions and that we should reform these institutions so that we can have trade deals that are going to help people and be fair, we see people who are involved in the business of lobbying and international lawyers who look out for the best interests of corporations and certainly themselves being able to change how these institutions work. That is so very sad.

The House resumed from January 28 consideration of the motion that Bill C-9, An Act to implement the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention), be read the third time and passed.

[Vivian Barbot, Bloc, Papineau, QC]

Mr. Speaker, on May 15, 2007, I had the opportunity here in the House to talk about why the Bloc Québécois supports Bill C-53, which is identical to Bill C-9, An Act to implement the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention). Today, therefore, I will talk about how international treaties are now typically drafted with no regard whatsoever for democracy.

I would like to begin by saying that the Bloc Québécois wants all treaties to go through the House of Commons. The current way of doing things completely disregards democracy. Bill S-5, which provides for the coming into force of tax conventions, shows how important international treaties are to our daily lives. These days, treaties are brought before Parliament only when they require enabling legislation.

In Canada, Parliament and parliamentarians play a minimal role in negotiating and ratifying international treaties. The federal executive controls all phases of the process. The executive is also responsible for what takes place in negotiations, which are, for the most part, secret. This secrecy is an important part of the federal government's negotiation strategy. Next to nothing, and sometimes nothing at all is disclosed before the parties sign an agreement in principle on the content and even the wording of the treaty. Even though the provinces are usually kept abreast of negotiations for trade agreements, they participate very little in the process and, with few exceptions, are totally excluded from the decision-making process.

Where international treaties are concerned, democracy is totally absent. There is no complete compilation of such treaties. Governments release them when and if they see fit, and people cannot be sure they are all being disclosed. The treaty section at the Department of Foreign Affairs does not even have a list of signed treaties to consult. The government is not required to table treaties in the House of Commons. It does not even have to inform the House or the public that it has signed or ratified treaties. The House does not get to approve treaties. The government can sign and ratify any treaty it wants without consulting the representatives of the people. At the very most, treaties requiring legislative changes are brought before Parliament before ratification.

In Quebec, since 2002, a vote in the National Assembly is required. Being in no way involved in the negotiation of treaties, the House of Commons cannot consult the public. It is therefore not surprising to see people increasingly expressing their opposition in the streets. In fact, there is no other place for them to be heard. The government is not required to consult the provinces either, even though it cannot implement treaties that concern areas of provincial jurisdiction and the provinces are not bound by the federal government's signature. It is totally absurd that no formal consultation mechanism is in place.

The government is preventing the provinces from being able to act internationally by controlling their international relations and by not allowing them to reach treaty-like agreements. This is unacceptable.

It used to be that international treaties governed relations between states and had little or no impact on how society functioned or on the lives and rights of citizens. At the time, it was acceptable for the government to unilaterally sign or ratify treaties.

Now, however, international treaties, especially trade agreements, affect the power of the state, the workings of society and the role of citizens. Furthermore, they often have an even greater impact than many bills. The Canadian treaty ratification process is not in line with this new reality. The people's representatives must be involved in decisions that affect the people they represent.

During the election campaign, the Conservatives promised to bring treaties before the House prior to ratifying them, but they still have not kept that promise. Recently, the government signed an investment protection agreement with Peru. This agreement is based on chapter 11 of NAFTA, which has been criticized by many. Yet the government concluded it without putting it to the House. When the House presses the government to honour its international commitments, as it has done in the case of the Kyoto protocol, the government does what it pleases, with no regard for the will of the people or the promise it made when it signed the treaty.

As was the case when Bill S-5 was passed, the fact that Bill C-9 will be passed quickly is an opportunity to show the government that democracy is not something to be feared when concluding fair treaties. The government must honour its promise to submit to the elected representatives any treaties that it intends to ratify, as it is forced to do here today with the three tax treaties. Once it has ratified them, it must honour them, as we hope it will honour the tax treaties we are discussing here today, and the Kyoto protocol, which the House is pressing it to honour.

This failure to involve the representatives of the people is an anachronism. It is impossible to tell from the division of legislative powers provided in the Constitution Act, 1867 which level of government, federal or provincial, has authority to sign a treaty with a foreign government. No provision is made in the Canadian Constitution for a jurisdiction anything like external relations or international relations. This is understandable, however, because when the Constitution Act, 1867 was passed by the British Parliament in London, Canada was still a colony of the British Empire. In 1867, the British Parliament reserved for the British Crown the power to represent the Dominion of Canada internationally and to enter into treaties with foreign countries on its behalf.

Under section 132 of the Constitution Act, 1867, however, the federal government was given responsibility for implementing, in Canada, treaties entered into by the British Crown, where these were applicable to this country.

In 1931, pursuant to the Statute of Westminster, Canada, as well as several other dominions of the British Empire, acquired full independence and, along with it, the authority to act with all the attributes of a sovereign state on the international scene. It was then that the federal government acquired jurisdiction over external affairs. Considered a royal prerogative when the Constitution was written, this authority was transferred to the government which, as the sovereign's representative, exercises it alone and without involving Parliament.

Once the governor in council approves an agreement reached between Canada and a foreign country, no matter who negotiated the treaty, that agreement becomes an international treaty. The representatives of the people do not have a say in it because the federal government has simply inherited a royal prerogative dating back to the British Empire.

Parliament only becomes involved when the ratification of a treaty requires an enabling statute. Canadian legislation may have to be amended because of the treaty. The legislative implementation of these treaties is the only occasion when Parliament has a say in the entry into force of a treaty in Canada.

It should be pointed out that many treaties requiring the Canadian state to adopt specific standards are not presented to Parliament for the adoption of enabling legislation. In such cases, the government believes that the Canadian legislation already conforms to the international obligations adopted or that the subject of the treaty does not require the adoption of new legislative provisions.

Consequently, no amendments are made to existing laws nor is a new law adopted by Parliament. For example, Parliament did not adopt legislation to implement or approve the ratification of the International Convention on the Rights of the Child. In such cases, the treaty never goes before Parliament.

In short, Canada is less democratic today that in was in the 20's. In June 1926, Prime Minister King introduced a resolution that was unanimously adopted by the House of Commons. It read as follows:

Before Her Majesty's Canadian ministers recommend ratification of a treaty or convention involving Canada, Parliament's approval must be obtained.

In 1941, Mackenzie King reiterated his commitment to this formula:

With the exception of treaties of lesser importance or in cases of extreme urgency, the Senate and the House of Commons are invited to approve treaties, conventions and formal agreements before ratification by or on behalf of Canada.

Over the years, approval by resolution has been sought less and less. During the cold war, the government dropped the convention of seeking Parliament's approval before signing treaties or engaging in military intervention on foreign soil.

The government even stopped tabling treaties in Parliament. Except for the Kyoto protocol, not one treaty has been approved by resolution since 1966—over 40 years ago—and that was the Auto Pact. As for Kyoto, the government has refused to honour it. So much for democracy.

Furthermore, Canada is less democratic than the rest of the industrialized world. Most other major industrialized democracies support greater involvement of their parliaments in ratifying treaties. For example, the constitutions of France, Germany, Denmark, Italy and the United States require legislative approval of some types of international agreements prior to ratification.

Some countries that share constitutional traditions with Canada have tried to enshrine their parliament's role in examining treaties.

In the United Kingdom, a convention established in the 1920s, the Ponsonby Rule, requires the tabling of international agreements in both Houses of Parliament at least 21 days before they are to be ratified. This gives parliamentarians the opportunity to debate them before the government ratifies them, even though these debates are not binding. This kind of thing does not exist in Canada.

More recently, in 1996, Australia changed its procedure for concluding treaties. Under this procedure, treaties must be tabled in parliament at least 15 sitting days before any binding decision is made by the executive branch; a national interest analysis of the expected impact of the treaty obligations must be done, for each treaty, and tabled in parliament; a standing joint committee on treaties must be established to examine potential treaties and report on them. There is nothing of the sort in Canada.

As usual, Canada trails Quebec.

In Canada, the provinces pass laws in their constitutional fields of jurisdiction. As the British Privy Council ruled in 1937 in the labour conventions case, the provinces' legislative authority also extends to the implementation of international treaties.

As soon as a treaty or part of a treaty involves a provincial jurisdiction, the provisions in question can be implemented only by the provinces. Since 1964, Quebec has concluded some 550 international agreements involving many fields of jurisdiction for which it has full or partial responsibility, such as culture, economic development, drivers' licences, international adoption, the environment, science and technology, and communication.

For a major agreement to be binding, the Government of Quebec must first submit it to the Quebec National Assembly for approval. Only then will Quebec be bound by an international agreement entered into by Canada and agree to pass legislation to implement the agreement. Furthermore, under the legislation, Quebec's Department of International Relations must list and publish all of Quebec's international agreements. There is nothing of the sort in Canada.

The Bloc Québécois has introduced three bills on treaties to modernize the entire process for concluding international treaties.

The Bloc Québécois bill on treaties was designed to build transparency and democracy into the process of negotiating and concluding international treaties. Since such treaties have an increasingly large impact on our lives, it was more important than ever to make such a change. Moreover, the bill required that the federal government respect the provinces' jurisdictions.

The bill provided for five changes: all treaties were to be put before the House of Commons, the House was to approve important treaties, a parliamentary committee was to consult civil society before Parliament voted on important treaties, treaties were to be published in the Canada Gazette and on the Department of Foreign Affairs website and the government was to consult with the provinces before negotiating a treaty in an area of provincial jurisdiction.

The treaty bill came to a vote only once, on September 28, 2005. All the federalist parties voted against it.

No strangers to contradiction, the Conservatives made two promises about international treaties during the last election campaign. They promised to put international treaties before the House prior to ratification and to give the provinces a role in concluding treaties pertaining to their jurisdictions. Both these promises were broken.

Since they were elected, the Conservatives have amended NAFTA. They have signed two investment protection agreements based on NAFTA chapter 11, one of which has been ratified. They have concluded a military cooperation agreement to authorize British soldiers to train in Canada. They have signed cooperation agreements on higher education, even though education does not come under Ottawa's jurisdiction. They have concluded an agreement to facilitate technology transfers from Canada to China. And they have amended the free trade agreement with Chile.

Aside from the amended NATO treaty, which was brought before the House at the last minute for a mini-debate and vote, none of these international treaties has come before the House.

And where is the nation of Quebec in all this? The federalist parties say they rejected the Bloc Québécois bill because of two clauses, 4 and 6.

First, clause 4 provided for a mechanism for consulting with the provinces:

Canada shall not, without consulting the government of each province in accordance with the agreements entered into under section 5, negotiate or conclude a treaty

(a) in an area under the legislative authority of the legislatures of the provinces; or

(b) in a field affecting an area under the legislative authority of the legislatures of the provinces.

As for clause 6, it recognized the validity of the Gérin-Lajoie doctrine:

Nothing in this Act in any manner limits or affects the royal prerogative of Her Majesty in right of a province with respect to the negotiation and conclusion of treaties in an area under the legislative authority of the legislatures of the provinces.

The clause on consulting Quebec and the provinces is nothing revolutionary. When the federal government discusses, in an international forum, the text of a treaty having an impact on the provinces, then it consults the provinces beforehand.

Under an agreement concluded in 1975—and still in effect—between the Trudeau government and the provinces, Ottawa consults the provinces at every stage of the negotiation of treaties involving human rights.

Every federalist party in Ottawa is more centralist than Pierre Elliott Trudeau on the issue of international relations.

It is not just a Bloc Québécois bill that the federalist parties have rejected, it is a Quebec law. Section 22.1 of the Act respecting the Ministère des Relations internationales requires the consent of the Government of Quebec with respect to the signing, ratification or adherence by the Government of Canada, before the latter acts internationally on any agreement concerning matters under Quebec's constitutional jurisdiction.

As far as the section recognizing the provinces' right to negotiate and conclude international treaties in their jurisdictions is concerned, it was simply a recognition of the Gérin-Lajoie doctrine which every Government of Quebec has been following since 1965.

The Gérin-Lajoie doctrine is closely linked to Quebec's independence: the provinces are completely sovereign within their jurisdictions and they must exercise their authority over the entirety of their jurisdictions, which includes signing and ratifying international treaties.

In closing, these are some of the arguments in favour of more involvement by parliamentarians in the negotiation and ratification of international treaties for the good of democracy.

[Libby Davies, NDP, Vancouver East, BC]

Mr. Speaker, as the member is probably aware, members of the NDP oppose the bill because of our concerns about it. The bill in and of itself, in terms of the process that it outlines for the settlement of investment disputes, is not so bad as far as it goes. However, we are very concerned about the larger context of the bill, its relationship to the World Bank and the involvement of multinational corporations.

One of the things we have raised in the debate on Bill C-9 is that the ICSID process does not allow for third party testimony except where there is consent from both parties in the arbitration, which is not necessarily easy to get. This has been held up as one of the serious concerns about this process. It makes the whole dispute mechanism, which is meant to be transparent, accountable and open, very inaccessible to local communities and third party stakeholders that may have a lot to say about representing a public interest in this process.

Could the member comment on that? Does she and members of her party also have concerns about that?

From our point of view, we think it will affect southern developing states most of all and will further marginalize developing countries in these transborder processes. It really eliminates the genuine and meaningful input of third party testimony of stakeholders and local communities, so the whole process becomes meaningless because they are in effect cut out.

Would the member comment on that?

[Vivian Barbot, Bloc, Papineau, QC]

Mr. Speaker, I thank my colleague for her question. In fact, there are certain limitations in this type of treaty.

What I was trying to highlight in speaking about the context in which these matters are dealt with—and I did point this out—is that, on the one hand, civil society has no input and, on the other hand, even we as parliamentarians who represent civil society, do not have the opportunity to debate these treaties. This occurs in a context where it is the government that decides. Obviously, when the mechanism itself is included in these treaties, there may be some elements that are problematic. However, we believe that these treaties are much better than the current situation. It still represents a step forward in the resolution of conflicts that may arise from international treaties.

[Larry Bagnell, Liberal, Yukon, YT]

Mr. Speaker, I congratulate the member for her excellent address to the haggis last night.

At the beginning of the member's speech, she mentioned consultation with the provinces and territories in advance of such treaties. My understanding is that she was suggesting there was no consultation with the provinces and territories. If she asked federal employees in the Department of Foreign Affairs, they would tell her that they do consult with the provinces and territories about treaties affecting them.

Does the member believe no consultations are held with the provinces and territories when treaties are being negotiated?

[Vivian Barbot, Bloc, Papineau, QC]

Mr. Speaker, my understanding is that these consultations are just informal. The government has no official, legal obligation to consult the provinces and take their opinions into account. The provinces are not bound at all by these treaties when their areas of jurisdiction are involved. The government can make any decisions it wants because it has no obligations.

The provinces, in turn, are not bound unless they decide to ratify the treaties. In Quebec, if the government is asked for its opinion, it is obliged to check things out and bring all the necessary documents before the Assembly chamber. The chamber makes a decision and, at that point, Quebec is bound. It is the province that ratifies. This is what I meant when I said that there were no consultations.

Public officials talk to each other, of course, to learn what the effects will be, but regardless of what the provinces say, the central or federal government can sign the treaties it wants. However, it is the provinces that implement them, and the provinces can decide not to do so. This does not limit in any way the federal government’s power to sign these treaties.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, first I would like to congratulate my colleague on her speech. I wanted quickly to remind her that in question period yesterday in the House, a Conservative asked a question of the foreign affairs minister about international treaties, claiming that the Conservative Party was more open and transparent. He said: “—we committed to bringing international treaties before the House of Commons to give Parliament a role in reviewing them”. Note the use of the word “review”.

The foreign affairs minister, boasting about fulfilling another election promise, said: “Effective immediately, any international treaty we sign will be tabled in the House of Commons”.

I want to ask my colleague, therefore, where she sees any transparency in this and any ability of the House to really discuss treaties that have been signed by the government but are not brought before the House to be ratified but just to be presented and reviewed. We are still very far from parliamentary democracy.

[Vivian Barbot, Bloc, Papineau, QC]

Mr. Speaker, I thank my hon. colleague for this question. Naturally, what the member said yesterday caught my attention. This is another example of the current Conservative government's clever ways of saying one thing and then the very opposite. The government says it will honour its promise and that it will allow “reviewing”. Yet, given this choice of vocabulary, one can clearly see that this leaves no room for real discussion before the treaty is signed or ratified.

We are facing exactly the same situation as their promise concerning UNESCO. These are half-measures that do not resolve anything. Yet, the government uses them to say that it is delivering on something it had promised. Each time, we are disappointed, since the reality is at odds with the terms used. This is a perfect example of what I would call a lack of democracy.

To some extent, actually, it makes no difference if we are told that, from now on, Parliament will have its say, because, if we take a closer look at the situation, the government is facing a fait accompli. It is just more of the same.

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, this is also the second time I have spoken on this bill. As we already know, from what my colleague from Papineau has said, the Bloc Québécois supports Bill C-9 in principle.

Passing this bill will mean that Canada can ratify the Convention on the Settlement of Investment Disputes between States and Nationals of Other States and join the International Centre for Settlement of Investment Disputes.

Because I will be making frequent reference to the International Centre for Settlement of Investment Disputes and the name is a little long, I will call it simply the centre in my speech.

Bill C-9 incorporates the requirements of the convention into domestic law, two reasons being to ensure compliance with arbitral awards and grant the immunities that the centre and its staff need. The centre was created by the World Bank in 1965 under the Treaty of Washington. At present there are 156 member countries. The centre is responsible for arbitrating disputes between a state and a foreign investor.

There are two potential kinds of conflicts: first, there are disputes relating to compliance with bilateral foreign investment protection agreements, and second, there are disputes relating to agreements between governments and foreign investors. These are agreements of the kind that the Government of Quebec and other governments regularly enter into to encourage foreign investment, with the promise, for example, to supply electricity at an agreed price.

Canada’s membership will have no impact on the provinces and Quebec, other than that they will also be able to allow for recourse to the centre when they enter into agreements with investors. The bilateral treaties signed by the federal government already provide for recourse to arbitration by the centre, but by way of the supplementary arbitration mechanism rather than a regular mechanism, which is available only to countries that have ratified the convention.

In fact, the only thing that Canada's joining the centre will change is that it will be able to participate in negotiations to amend the centre's convention or by-laws and will have the assurance that it may participate in appointing arbitration tribunals. There will therefore be direct participation in the centre. Ultimately, the centre is merely a tribunal, and the problem is not the tribunal, but the bad investment protection treaties that Canada signs.

The Bloc Québécois supports signing investment protection agreements as long as they are good agreements, obviously. It is entirely reasonable for an investor to try to ensure, before making an investment, that he or she will not end up losing his or her property, and will not be discriminated against. That is the situation that foreign investment protection agreements are intended to govern. This is not a new phenomenon. The first known agreement containing provisions relating to the protection of foreign investments was the agreement between France and the United States signed in 1788, over two centuries ago.

In May 2007 there were over 2,400 bilateral investment protection agreements in the world. If we add the tax conventions dealing with the tax treatment of foreign investments and income, there are about 5,000 bilateral treaties relating to foreign investments. The Bloc is in favour of signing agreements like this and recognizes that they promote investment and growth. These agreements are all based on more or less the same principles.

The first principle that could be mentioned is respect for property rights regardless of the owner's nationality. Second, there can be no nationalization without fair and prompt financial compensation. Third, there is a prohibition against treating property located within a country's territory differently depending on the owner's origin. Finally, there is free movement of capital resulting from the operation and the disposal of investment.

In every case, when these rights are violated, states may submit disputes over compliance with an agreement to an international arbitration tribunal. In the majority of cases, investors themselves may submit the dispute to an international tribunal, but only with the consent of the state. In many cases, the international arbitration provided in the agreement takes place before the ICSID. By belonging to it, as Bill C-9 provides, we are also agreeing to an international order in the field of investment.

In the investment protection agreements that they sign, only two countries, Canada and the United States, systematically grant investors the right to appeal directly to international tribunals. This is a deviation from the norm. By allowing a company to operate outside government control, it is being given the status of a subject of international law, a status that ordinarily belongs only to governments.

The agreements that Canada signs contain a number of similar deviations, giving multinationals rights they should not have and limiting the power of the state to legislate and take action for the common good. Take, for instance, the now infamous chapter 11 of NAFTA, which provides that a dispute can go to ICSID. There are, however, three things wrong in that chapter: the definition of expropriation, the definition of investor, and the definition of investment.

The definition of expropriation is so vague that any government measure, except for a general tax measure, can be challenged by foreign investors if it diminishes the profits generated by their investments. Indeed, a Kyoto implementation plan which would have large polluters such as oil companies pay dearly could be challenged under chapter 11 and result in government compensation.

American companies have majority interests in Alberta oil companies. Chapter 11 opens the door to the worst kind of abuse of process. The definition of investor is so broad that it includes any shareholder. Anyone could therefore take the state to court and seek compensation for a government measure that allegedly cut into a company's profits.

As for the definition of investment, it is so broad that it even includes the profits that investors hope to derive from their assets in the future. In the case of expropriation, not only does the state find itself forced to pay fair market value, but it also has to include future revenues that investors expected to draw. This would make nationalizing electricity, as Quebec did in the 1960s, impossible.

Take the example of SunBelt, a corporation with one Canadian shareholder and one Californian shareholder. This corporation closed its doors when the Government of British Columbia removed the right to export water in bulk that it had been granted. Under Canadian law, the Canadian shareholder received compensation equivalent to the value of his investment: $300,000. Under chapter 11 of NAFTA, the American shareholder included in his claim all potential future revenue from the sale of water, for a total of $100 million. For better or for worse, the case was settled out of court for an undisclosed amount that is not likely to ever be disclosed.

Given the amounts of money at issue, chapter 11 acts as a deterrent to any government action, particularly with respect to the environment, whose effect would be to reduce the profits of a foreign-owned corporation. The dispute settlement mechanism allows corporations to apply directly to the international tribunals to seek compensation, without even having to obtain the consent of the state.

Is it conceivable that a multinational corporation would be able, on its own initiative, to instigate a trade dispute between two countries? And yet that is the absurd situation that the chapter of NAFTA on investments allows. Given these flaws, chapter 11 of NAFTA reduces a state’s ability to take action for the common good and to enact environmental legislation, and amounts to a sword of Damocles that can come down at any moment on any legislation or regulations that might have the effect of cutting into corporate profits.

In 2005, the United States changed some of the provisions of their standard investment protection agreement. In 2006, Canada did the same. Because the two countries have now recognized the harmful and extreme nature of chapter 11 of NAFTA, the time is right for the government to act quickly to initiate talks with its American and Mexican partners to amend chapter 11 of NAFTA. We have to say no to bad investment protection agreements.

In addition to chapter 11 of NAFTA, and despite universal criticism of how extreme it is, the government has signed 16 other bilateral foreign investment protection agreements that are carbon copies of it. All of those foreign investment protection agreements are bad and should be renegotiated.

In 2006, the government gave some indication that it recognized that these agreements were bad. The Conservative government copied the changes made by the Bush administration the previous year, and in fact made changes to Canada’s FIPA program to fix some of the most glaring problems. It clarified the concept of expropriation by specifying that a non-discriminatory government measure designed to protect health and the environment and to promote a legitimate government objective should not be considered to be expropriation and should not automatically result in compensation.

It is too soon to assess the actual impact of that clarification, but at first blush it seems to be an improvement. It has narrowed the concept of investment by specifying that the value of property is equal to its fair market value. This puts an end to the madness of adding in all of the potential profits the investor hoped to earn from his or her investment. For the rest, the standard investment protection agreement continues to be modelled on chapter 11 of NAFTA.

The government must continue to improve this standard agreement, particularly as it relates to the dispute resolution mechanism. Multinational corporations must be brought back under public authority, as any individual is.

As well, the government should submit international treaties and agreements to the House before ratifying them. That is what we are being promised and it is what I referred to earlier, but is the purpose really to have a substantive discussion? Is it really a discussion to learn the benefits, the opportunities, perhaps, or the harm that might be caused to certain industries in Canada and Quebec?

Yesterday, the government seemed to be saying that the question of ratification was up for discussion and study, but is it going to ratify without the House having really come down for or against a specific agreement?

Early last year, the government issued a press release announcing that it had just ratified a new foreign investment protection agreement with Peru. Parliamentarians and the public learned about the agreement when they read the release. Parliament was never informed about it. It never approved it. That is completely anti-democratic.

In the last election, however, the Conservative election platform was clear: the Conservatives committed to submitting all international treaties and agreements for approval before ratifying them. That is not what we heard yesterday in this House: what was said was that they would be presented to the House and the House would be made aware of them, but the Conservative members, including the minister, never said that the House was to ratify them.

Since the Conservatives came to power, Canada has ratified about 26 or 27 international treaties. Except for the amendment to the NORAD treaty, which was the subject of a brief last-minute mini-debate and a vote, none of these international treaties were brought before the House.

These days, international agreements can have as great an impact on our lives as laws. Nothing can possibly justify the secretive, unilateral ratification of these agreements by this government without the participation of the representatives of the people.

In the past, the Bloc Québécois introduced bills to restore democracy and ensure respect for the jurisdiction of Quebec and the provinces in the ratification of international treaties. Given that this is something the government promised to do, we did not bring it up again. However, today we see that a Conservative promise is not worth much.

So the Bloc Québécois will once again take this matter up and will make proposals to bring democracy back into the ratification of international treaties. The government must have an obligation to submit to the House all international treaties and agreements it has signed before ratifying them. The government must be required to publish all international agreements in which it is involved. The government must also allow the House to vote on and approve all major treaties, following study by a special committee responsible for reviewing international agreements, before ratifying them. The government must also respect the jurisdiction of Quebec and the provinces throughout the treaty-making process at the negotiation, signature and ratification stages.

In conclusion, the International Centre for the Settlement of Investment Disputes is needed to ensure that States are treated fairly in their dealings with multinational corporations. We must also ensure that the agreements Canada signs are good ones that respect all stakeholders.

[Larry Bagnell, Liberal, Yukon, YT]

Mr. Speaker, this particular law would protect employees in Canada and in many countries from arbitrary actions by governments that are not as predictable and do not have the formal procedures that Canada has. I think the member's party agrees with that.

In relation to his question about chapter 11 not allowing environmental regulation, does he have any specific examples of that occurring that he could give to the House?

[Serge Cardin, Bloc, Sherbrooke, QC]

Mr. Speaker, regarding environmental regulations, indeed, all countries, all responsible governments, whether Liberal or Conservative, should enforce them. Governments must establish environmental regulations that produce results.

In the current context where environmental legislation and regulations will have serious consequences for businesses that do not or did not comply with them, chapter 11 will do just that; it will ensure that certain businesses comply with the regulations, forcing them to implement various procedures or measures to protect our environment. However, this comes at a price.

Chapter 11, which we are discussing here today, would allow foreign companies—including American companies, of course—to sue any government that enforces these regulations. This is why chapter 11 of NAFTA really must be modified. Generally speaking, with regard to the ICSID, it ultimately comes down to relationships between the governments and the multinationals.

Canada must sign agreements and accords to ensure the development and maintenance of economic relationships with other countries, of course, and also must protect them. Basically, that is the goal of bilateral agreements reached by the government. They must be good agreements. Based on current regulations, for example, concerning the environment, the government must not allow multinationals the possibility of suing it on a daily basis. Thus, our treaties ultimately need to be good treaties that not only protect our investments and our investors but also the environment and our working conditions.

The reverse must also be true. For instance, some countries—and even Canada—invest money in other countries without respecting the rights of individuals or the environment. Yet if those countries suddenly were to implement policies to protect the working conditions of these people or the environment, would our own Canadian and Quebec businesses operating internationally demand compensation?

To sum up, agreements between countries must aim for fairness and justice, for us as well as for other people.

[Libby Davies, NDP, Vancouver East, BC]

Mr. Speaker, I am pleased to speak in the House today at third reading on Bill C-9, An Act to implement the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention). The NDP is opposed to the bill and I will outline some of the reasons that we are opposed to it.

This is a bill that, on the face of it, looks fairly innocuous. It deals with a dispute mechanism. It involves the World Bank. It involves the status of multinational corporations when they are dealing with investment in foreign countries and ensuring there is a dispute resolution process.

On the face of it, it looks fairly reasonable, but when we dig a little bit deeper we find that this just skims the top in terms of what the bill represents in terms of a global regime that has seen over the last 20 years a massive transfer of power from governments to multinational corporations under the World Trade Organization under these trade agreements.

I would note that the Deputy Speaker, the member for Elmwood—Transcona himself, as a member of the House, has played a very active role. Mr. Speaker, I know you have been very involved with the NDP over the years when we fought the multilateral agreement on investment and the Free Trade Agreement of the Americas in Quebec City. Now we are dealing with the so-called security and prosperity partnership agreement that involves Canada, the United States and Mexico.

Mr. Speaker, I know you are very familiar and have a lot of credibility and a long record on dealing with these massive trade agreements that impact and undermine the democratic rights of Parliament and other states, and creates an enormous gulf in terms of the ability of citizens to organize themselves to have an impact on how these agreements come about and how they are dealt with in terms of disputes and the decisions that flow from them.

When we looked at Bill C-9 and had discussions in our caucus, we came to the conclusion that we could not support the bill.

The ICSID, as it is called, is part of an international trade and investment regime that has come under very harsh criticism from civil society because it does confer unprecedented powers to multinational corporations through bilateral investment treaties.

One of the concerns that I raised earlier today is that through this agreement there is no place for third party testimony. There is no accountability, no transparency and no openness or disclosure that would allow local organizations in an affected community or a labour union to come to the table and be part of the dispute resolution mechanism that is contemplated in this agreement unless there is consent by both parties involved in the arbitration, which is probably very unlikely. It makes it very inaccessible to local communities and third party stakeholders who would be impacted by the decisions being made. We believe that is a problem with the bill but that is just the tip of the iceberg.

A question was asked in the House yesterday by a Conservative backbencher who was congratulating the Minister of International Trade on his announcement that Canada has now concluded a free trade agreement with Peru. The Conservative member for Kelowna—Lake Country was asking the Minister of Labour whether the agreement with Peru would now provide labour rights protection in Peru. Not surprisingly, the Minister of Labour stood in the House and crowed that the trade agreement with Peru would deal with an improvement in labour rights, that everything would fine and that we should not worry about it. The Conservatives were patting themselves on the back.

I raise that issue because it is a very current example of the nature of these agreements and how they completely violate and undermine labour rights. They do nothing to be proactive in protecting very serious labour situations.

Yesterday the Minister of Labour claimed in the House that this international trade agreement with Peru will give protection to labour rights. On January 18 information came from the Peruvian workers' union denouncing the fact that over 3,000 workers have been dismissed in that country for organizing trade unions. Labour rights are virtually non-existent. Something is not right with this picture.

Ministers are trying to assure the public that people's basic human rights around labour, child labour, the environment and social standards are being protected and yet we have very concrete examples to tell us that in places such as Peru, which is just one example, there are very serious situations. Workers in that country are being undermined and their rights are being violated all the time.

In October 2007 the International Trade Union Confederation prepared a report for its general council and reviewed trade policies in Peru. This is a very current report. It is quite clear about the fact that there are very serious problems in that country. The recommendations in the report made it very clear that the government of Peru should amend its legislation to conform with the International Labour Organization's conventions 87 and 98. Convention 87 has to do with the freedom of association. Convention 98 has to do with the right to organize and the right to collective bargaining.

I find it contradictory that on the one hand a minister of the Conservative government is trying to assure us that everything is okay and that he has negotiated something that is going to protect those workers and yet the representatives of workers in that country are portraying a completely different reality. That is something of concern to the NDP.

We in the NDP believe that as parliamentarians we have a responsibility to not only uphold these international conventions that protect labour, human rights and the environment in our own country, but we also have a responsibility to speak out in the international community to make sure that those rights are upheld. We expect the Government of Canada to do the same. We expect the Government of Canada to show leadership on those questions.

To come back to the bill that is before us today, that is the very reason we find it to be very contentious. It is the very reason we find this bill to be completely missing the point about what is taking place on a global scale.

The members in our caucus have participated in many forums, discussions and educational workshops. It is quite incredible, given this global situation of opening up the floodgates to the transfer of capital with virtually no rules, that citizens have taken it upon themselves to become informed and educated as to what it is that is going on. These are not easy matters to get a handle on. These are very complicated agreements set up under the WTO. We learned that from the MAI. We are learning that now from the security and prosperity partnership.

We know that agreements are put together in secret. They are done at places like Montebello where leaders meet behind closed doors. The connection to the public, the ability of civil society to have any input or to be able to say anything is limited. In fact, security forces go to great lengths to ensure that kind of dialogue does not take place.

Our caucus has a lot of experience in dealing with these agreements. We understand the implications they have for a democratic society. Fundamentally, we express our concern in the House as well as in the community that we see it as a shift from making decisions in a democratic process in Parliament to a secretive process where we have no access. We do not even have access to that as members of Parliament.

If Canadians were asked what is the purpose of government, what are we here for, our constituents and members in our community would say that the purpose of government is to protect them. The purpose of government is to ensure that they have health care, education, income security and that the country is safe.

Over the years under these neo-liberal and neo-conservative policies, we have seen a massive shift in the role of government. That power has been transferred from government into the hands of undemocratic, unelected, unaccountable, non-transparent multinational corporations. These trade agreements have facilitated that process.

We should be standing up very strongly against these kinds of agreements. What we are most concerned about right now is the security and prosperity partnership that is taking place between the countries on the American continent: Canada, United States and Mexico.

We have been very outspoken. The member for Burnaby—New Westminster, our trade critic, has done an amazing job. He has travelled across this country. He has already gone to 12 communities. He is travelling to another 12 communities where we are holding public hearings on the SPP.

There is so much deep concern in the community about what that agreement will do and the fact that the government, as the previous government did, is signing on to this agreement with virtually no public disclosure. It will impact every aspect of domestic life in Canada. It will impact on the ability of Parliament to do its job. It will impact on the delivery of services. It will exacerbate the privatization of services. It will exacerbate the deregulation that is taking place in our society. At the end of the day these are things that begin to affect the quality of life. It becomes a race to the bottom.

We recognize the connection that this bill has in dealing with the dispute mechanism and its attachment to the World Bank, how it is completely complicit and tied into this move to globalization that is shutting down the democratic process. We strongly object to that. We intend to do everything we can not only in Parliament but in the broader civil society to see that these agreements are opened up, changed, that they are refuted.

We understand that trade is obviously going to happen. Trade is an important part of our economic activity in life, but we want to see fair trade. We want to see trade that is based on agreed to and implemented around core standards that set out labour rights, that set out environmental rights, that set out a social contract and social conditions so that the workers in the south are not being exploited and that Canadian workers are not losing their jobs as a result of these trade agreements.

We have seen a loss of over 300,000 manufacturing jobs. The Canada-South Korea trade agreement is under development. All of these things are taking place with virtually no debate or understanding. All this takes place behind closed doors.

The bill before us today is at third reading, but we believe it is not a good bill. It does not deal with realities that are before us in terms of what is happening with these trade agreements. We have to be incredibly skeptical about what the Conservative government is doing and what its agenda is.

I will use another example. Yesterday in the House we heard a minister of the government say that international treaties will be brought before the House which will be tabled, discussed and debated. On the face of it, it sounds reasonable, but if we go back a couple of years to September 2004, the then leader of the official opposition, who is now the Prime Minister, actually made a commitment with the other opposition leaders, including the leader of the Bloc and the leader of the NDP, that international treaties should be voted on in this House.

That was an actual commitment. It was part of a package that was brought forward in that first minority Parliament. We agreed that there should be a vote in the House of Commons on international treaties. Already we have seen the Conservative government break its promise just by its announcement yesterday that there will not be a vote, that there may be some debate or notice. That is a clear violation of the commitment made in September 2004.

I will close by saying that members of our caucus have reviewed the bill very thoroughly. We have debated and discussed it with our partners in the labour movement, in the Canadian Labour Congress and other places with members of civil society. There is no question that the approval of the bill would reinforce a regime of trade and international practice that gives massive powers to multinational corporations at the expense of the democratic process in places like the House of Commons.

On that basis we cannot support the bill. We urge other members of the House to also show the strength of representing the public interest, because that is what we are here to do, to represent the public interest, and to vote down the bill.

[Keith Martin, Liberal, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, I listened very intently to my colleague's comments. She gave a fine dissertation on socialism. I would like to compare two countries, India and Zimbabwe.

India is a country that had very high levels of poverty. That country liberalized its markets, reduced restrictions, enabled the private sector to expand and improved trade among and between its neighbours. The outcome has been a dramatic decline in the poor in that country, with a burgeoning middle class.

While blanket free trade is not the answer and checks and balances have to occur and it must be fair trade, I would like to ask my hon. colleague for her comments. Hernando de Soto and Mohammed Unis and other people have spent their lives reducing poverty and they have spoken about the merits of free and fair trade. Does she not think that free trade agreements with countries enables those countries to raise their standards to the standards that our workers enjoy? In that way we are able to improve the lot in those countries, instead of erecting barriers to development, barriers to trade. Such barriers actually enable countries to maintain the restrictive covenants within their countries and hamstring the private sector and ultimately lead to a greater number of people living in poverty.

[Libby Davies, NDP, Vancouver East, BC]

Mr. Speaker, for us the question is not whether there is trade but what the rules are that govern trade. I gave the example today of Peru and what is happening in that country. We could look at other countries, such as Colombia, or any situation and see decades of terribly exploitative practices.

It is unprincipled for us in the north to advance these trade agreements on the basis that somehow we are lifting people out of poverty, when in actual fact we have created a regime that reinforces the divide between the north and the south and reinforces the exploitation that takes place. In fact, it makes it even more systemic. We need to acknowledge that and develop trade practices that have at their foundation labour codes, rules and the right to organize. Implementing the International Labour Organization conventions would be a start. Even Canada is not a signatory to all of those conventions.

If we cannot begin at that place and recognize that we must protect people's rights in terms of their labour, then I would say these trade rules are not worth the paper they are written on. They are simply a regime for greater and greater profit margins for multinational corporations. That is why they want them. They want to go into those developing countries. They want to see minimal rules because they want to find greater markets. They want to find more cheap labour. We should recognize the impact that has in our own country.

Yesterday in question period there were questions on the manufacturing sector and the loss of jobs in the forestry sector, the auto sector, the resource sector. Everybody was talking about it. It is related to these trade agreements. There is an impact here at home. The member needs to understand that for us it is not about trade. It is about the regime and the rules that we create. We believe that this particular bill will reinforce a regime that is fundamentally anti-democratic.

[Keith Martin, Liberal, Esquimalt—Juan de Fuca, BC]

Intriguingly enough, Mr. Speaker, in many ways the goals of the member and the goals of most of us are the same: the improvement of working conditions and the alleviation of poverty for workers. I have a question for the member. Does she not think that engaging other countries, by removing the barriers and creating norms and standards so that workers in our country and in other countries can actually enjoy the same standards, is a fair, equitable and reasonable goal? Does she not think that the way to do that is through these free trade agreements?

In fact, the biggest culprits, the two biggest problems, and the reasons why in many ways poverty remains in developing countries, are corruption and the lack of capacity. These are the two biggest cancers. The lack of capacity in developing countries and the corruption within those countries are the two greatest obstacles to sustainable development within those countries.

International organizations such as the World Bank and the IMF continually give large tomes to developing countries, with all manner of plans and objectives, but unfortunately those countries have no hope whatsoever of operationalizing them, because they do not have the people to take on those ideas and implement them. It is a fool's game and we continue to play that game.

Does the member not think we can achieve the objective of better working standards for workers, higher pay for workers and better environmental standards in the countries in which we are working by engaging those countries and establishing those rules through free trade agreements for the mutual benefit of both countries?

[Libby Davies, NDP, Vancouver East, BC]

Mr. Speaker, the member says there are two main barriers to the progress of prosperity for developing countries and he names capacity and corruption. I would add a third: exploitation under this regime of multinational corporations marching in, using natural resources, using cheap labour with no standards whatsoever, and exploiting the environment and local workers.

I would agree with him that of course we have to work for agreements that protect those social standards, but the reality is that over the last two or three decades of this incredible advancement of a globalized agenda through organizations such as the World Bank and the WTO, the primary focus has been on trade and lifting those barriers based on the needs and capacity of the multinational corporations, not based on whatever the domestic conditions are in the receiving country.

The whole premise that he advances is something that actually has not happened under this process of globalization. I think it is something that needs to be changed. Why would we not begin first with labour standards? Why would we not begin first with environmental standards and social standards? Why would we not begin from a place of social equity and social justice and advance trade on that basis?

As governments, we can do that if we have the political will. That is what we stand for in this party.

[Keith Martin, Liberal, Esquimalt—Juan de Fuca, BC]

Mr. Speaker, again I ask the member to look at countries such as India. I ask her to look at them before trade liberalization occurred and afterward.

Before trade liberalization, many industries were state-owned and inefficient, with high levels of poverty and worse working conditions. After trade liberalization occurred, there was competition. Standards were set. There was an improvement in wages. Poverty was reduced. Wages increased. Grinding poverty for the poorest of the poor, those living on less than a dollar a day, has been reduced dramatically. Let us compare those before and after situations in India. It is an intriguing example of what trade liberalization can do and should be doing.

I agree with my colleague in that we ought to be ensuring that these elements of worker security and environmental protection are built into the agreements we have. Indeed, that is what we attempt to do. The alternative is not to do that at all. Hernando De Soto and Muhammad Yunus have spoken eloquently about how we can make free trade agreements work and how we can tap into the private sector to enable it to be the generator of improved worker conditions and wages. We know that the private sector is the major generator of jobs in countries. We know that small and medium-sized businesses are the major generators of wealth.

Does the member not see that there are ways to make this happen through effective free trade agreements and that Canada can take a leadership role in this given the fine standards we have in our own country?

[Libby Davies, NDP, Vancouver East, BC]

Mr. Speaker, clearly when an agreement is signed and goes into effect there are people who benefit. The member gives some examples of what has happened in India, but I could also use Mexico as an example. I point out that after the free trade agreement with Mexico the average wage of workers there actually went down. We saw the factory zones. We saw the massive exploitation that took place and is still taking place.

In fact, in India, yes, there is a developing middle class that is well educated, but again I think we have to look at the whole balance sheet. If we do that, there is absolutely overwhelming evidence to show that overall the inequities not only have remained but have actually been reinforced through these agreements. They actually are producing some kind of collision course, with a divide in terms of wealth and power between the north and the south and the divide within our countries between wealth and growing poverty.

We see this in our own country. We just have to look at the massive loss of jobs in our own country. There are a lot of families who are simply being left behind. We are talking about the prosperity gap and the people who have been left behind by the government.

I think we have to look at the total picture, and when we do that there is only one conclusion that we come to, which is that these trade agreements as they are now are very bad. They are bad for the quality of life for average people. They reinforce the power of huge corporations that really could not care less about the workers who are working in their factories. It is our job to stand up for that and to challenge this.

[The Deputy Speaker, Bill Blaikie]

Is the House ready for the question?

[Some hon. members]

Question.

[The Deputy Speaker, Bill Blaikie]

The question is on the motion. Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

No.

[The Deputy Speaker, Bill Blaikie]

All those in favour of the motion will please say yea.

[Some hon. members]

Yea.

[The Deputy Speaker, Bill Blaikie]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Deputy Speaker, Bill Blaikie]

In my opinion the yeas have it.

And five or more members having risen:

Call in the members.

And the bells having rung:

There has been a request that the vote be deferred until tomorrow at 5:30 p.m. It is so ordered.

The House resumed from January 29 consideration of the motion that Bill C-9, An Act to implement the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (ICSID Convention), be read the third time and passed.

[The Acting Speaker, Andrew Scheer]

It being 5:30 p.m., the House will now proceed to the taking of the deferred recorded division on the motion at the third reading stage of Bill C-9.

Call in the members.

(The House divided on the motion, which was agreed to on the following division:)

Vote #31

[The Acting Speaker, Andrew Scheer]

I declare the motion carried.

(Bill read the third time and passed)

[The Acting Speaker, Andrew Scheer]

It being 5:58 p.m., the House will now proceed to the consideration of private members' business as listed on today's order paper.