Bill C-30 (Historical)

Canada-European Union Comprehensive Economic and Trade Agreement Implementation Act

An Act to implement the Comprehensive Economic and Trade Agreement between Canada and the European Union and its Member States and to provide for certain other measures

This enactment implements the Comprehensive Economic and Trade Agreement between Canada and the European Union and its Member States, done at Brussels on October 30, 2016.
The general provisions of the enactment set out rules of interpretation and specify that no recourse may be taken on the basis of sections 9 to 14 or any order made under those sections, or on the basis of the provisions of the Agreement, without the consent of the Attorney General of Canada.
Part 1 approves the Agreement and provides for the payment by Canada of its share of the expenses associated with the operation of the institutional and administrative aspects of the Agreement and for the power of the Governor in Council to make orders in accordance with the Agreement.
Part 2 amends certain Acts to bring them into conformity with Canada’s obligations under the Agreement and to make other modifications. In addition to making the customary amendments that are made to certain Acts when implementing such agreements, Part 2 amends
(a) the Export and Import Permits Act to, among other things,
(i) authorize the Minister designated for the purposes of that Act to issue export permits for goods added to the Export Control List and subject to origin quotas in a country or territory to which the Agreement applies,
(ii) authorize that Minister, with respect to goods subject to origin quotas in another country that are added to the Export Control List for certain purposes, to determine the quantities of goods subject to such quotas and to issue export allocations for such goods, and
(iii) require that Minister to issue an export permit to any person who has been issued such an export allocation;
(b) the Patent Act to, among other things,
(i) create a framework for the issuance and administration of certificates of supplementary protection, for which patentees with patents relating to pharmaceutical products will be eligible, and
(ii) provide further regulation-making authority in subsection 55.‍2(4) to permit the replacement of the current summary proceedings in patent litigation arising under regulations made under that subsection with full actions that will result in final determinations of patent infringement and validity;
(c) the Trade-marks Act to, among other things,
(i) protect EU geographical indications found in Annex 20-A of the Agreement,
(ii) provide a mechanism to protect other geographical indications with respect to agricultural products and foods,
(iii) provide for new grounds of opposition, a process for cancellation, exceptions for prior use for certain indications, for acquired rights and for certain terms considered to be generic, and
(iv) transfer the protection of the Korean geographical indications listed in the Canada–Korea Economic Growth and Prosperity Act into the Trade-marks Act;
(d) the Investment Canada Act to raise, for investors that are non-state-owned enterprises from countries that are parties to the Agreement or to other trade agreements, the threshold as of which investments are reviewable under Part IV of the Act; and
(e) the Coasting Trade Act to
(i) provide that the requirement in that Act to obtain a licence is not applicable for certain activities carried out by certain non-duty paid or foreign ships that are owned by a Canadian entity, EU entity or third party entity under Canadian or European control, and
(ii) provide, with respect to certain applications for a licence for dredging made on behalf of certain of those ships, for exemptions from requirements that are applicable to the issuance of a licence.
Part 3 contains consequential amendments and Part 4 contains coordinating amendments and the coming-into-force provision.

Canada-European Union Comprehensive Economic and Trade Agreement Implementation Act

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Madam Speaker, I am pleased to stand in this place to add comment on Bill C-30, Canada-European Union Comprehensive Economic and Trade Agreement Implementation act

The overwhelmingly positive economic impacts of Canadian businesses gaining preferential access to the world's wealthiest trade area cannot be overstated. This deal will reduce or eliminate approximately 99% of customs duties between Canada and the European Union. This will enhance the competitiveness of Canadian businesses whenever they sell a good into the European market.

Conversely, this will make it less expensive for Canadian businesses to buy specialized goods, like heavy machinery and parts that may not be available in Canada.

A joint Canada-EU study concluded that CETA could bring a 20% boost in bilateral trade and a $12 billion increase to Canada's economy. That is why the previous Conservative government was relentlessly focused on signing trade agreements around the world.

This focus led to Canada's first trade agreement with a major Asian economy in South Korea, and the first major trade agreement with a South American economy in Colombia. These footholds are hugely important for exporters who want to export their products to Asia or South America. For an economy that relies on the service sector and exports, these deals are of paramount importance.

That is why the previous government launched negotiations for Canada's most ambitious free trade agreement with Europe in May 2009. After years of negotiations with the European Union and its 28-member countries, negotiations ended in August 2014, and a deal in principle was reached during the summer of 2015.

The Liberals were handed the CETA on a silver platter. Yet, for reasons that may never be explained, they nearly blew it. For several days after Wallonia, a small region in Belgium, announced that it would be supporting the agreement, there were legitimate fears that the deal had collapsed.

On October 25, as the minister was in the House defending her record on this deal, she stated, “when it comes to CETA, Canada has done its job.”. The argument that because Canada had worked hard up to that point and therefore it was acceptable to let Europe do “its job now”, was fraught with so many problems I cannot even begin to list them. These deals do not sign themselves. Canada must always fight for its interests, and not sit and wait and hope for the best.

Thankfully, the pro-trade powers in Europe that strongly supported this deal got it moving again. They did so because CETA could serve as a template for a similar agreement between Europe and the United States at a later date.

The Minister of International Trade has been repeating over and over that she got CETA over the finish line because she made this deal more “inclusive and progressive”. The only thing that has changed from the deal in principle negotiated by the Conservatives and the agreement we are discussing today is the investor-state dispute settlement process. Nothing else has changed.

Canada has always been recognized as a country with the strongest record for human rights, rule of law, democracy, regulation, and the list goes on. CETA has always been a progressive and inclusive agreement because Canada has always been a progressive and inclusive country. Saying otherwise would be disingenuous.

Concerning the investor-state dispute mechanisms I mentioned, investor-state dispute arbitration tribunals are made available in nearly 3,000 bilateral investment treaties. Even Belgium has investment provisions with 182 different parties. These are not new, and many work quite well.

Under the investor-state dispute settlement process, foreign investors can sue the host state before an arbitration tribunal, appointed on a case-by-case basis by the two affected parties, if they believe the treaty governing trade between the two countries has been violated. This system is used for dispute mechanisms in over 3,000 bilateral trade agreements, including NAFTA, and its strengths and weaknesses are known and understood.

Civil society groups have questioned the appropriateness of applying a dispute settlement mechanism created to resolve private-commercial disputes to international public law disputes, because it is felt to favour the companies from larger countries. Critics have also raised concerns over the potential for the arbitrator to have bias and the potential for conflict of interest.

In response to these criticisms and in preparation for negotiations with the United States on a free trade agreement, the European Union began developing the concept of an investment court after the deal in principle with Canada was agreed to in 2014. The investment court would be a primary tribunal of 15 judges and an appeal tribunal of six members. The members would be named by the EU and Canada. It would be administered by the World Bank's International Centre for Settlement of Investment Disputes.

The court of first instance would sit in benches of three members each and would decide the original complaint. As with any new process, it is hard to know exactly how this will unfold. Who within each country will be responsible for appointing judges to the court? What will their training and fields of expertise be? How long will they sit for? Will the judges be idle if there are not many challenges? Or will they be allowed to work and consult in addition to their duties on the court?

Considering Canada's population is less than a tenth of the size of Europe's, how many of the 21 jurists would be Canadian? In the case of Wallonia, how many jurists would come from that region over jurists from France or Germany? There is no common law, in international disputes between corporations and governments, that jurists could draw guidance from when deciding cases, so it is hard to speculate whether the outcomes of legal challenges would be any different.

One of the main criticisms of the investor-state tribunals is that due to their decentralized nature, the arbiters do not necessarily consider the decisions of other arbiters. Therefore, their rulings are inconsistent. However, this new system does not necessarily fix this. If these investment courts become the norm, there could be hundreds of different courts deciding trade disputes. How consistent their rulings would be remains to be seen. Furthermore, a permanent multilateral investment court would only be consistent in its rulings relative to the treaty that governs the trade between two countries.

As with any new process, as I have said, it is hard to know exactly how it will unfold. If this new court satisfies European negotiators, then it should be included as the treaty's primary dispute mechanism. The question remains, why do the Liberals believe that this has made the CETA more inclusive or progressive? The fact is that jurists on the new court will render their decisions on the evidence and the text of the trade agreement, which remains the same as what the Conservatives negotiated 15 months ago.

Quite frankly, getting this trade deal done should have been the government's first priority. Now that it is signed, I hope it will place a relentless focus on getting the trans Pacific partnership completed at the earliest possible opportunity. The more markets Canadian producers can sell into without the competitive disadvantage of tariffs, the better off we will be as a country.

[Anne Minh-Thu Quach, NDP, Salaberry—Suroît, QC]

Madam Speaker, I want to point out that with regard to trade agreements, we supported Bill C-13, which was just introduced and which will move forward. This means we are capable of really thoroughly analyzing international trade proposals.

There are a lot of missed opportunities in Bill C-30 concerning the agreement with the European Union. As for anything related to dairy production, clearly, what the Liberals are offering is completely inadequate. They say they consulted those affected. Dairy producers were very vocal on several occasions to let them know that this was completely laughable. They are going to lose 2% of their production under this agreement. Dairy producers have been a real bargaining chip for a number of years now. There needs to be enough compensation to at least cover the $116 million per year loss. This is the bare minimum. We need to at least compensate them for that.

In the area of agriculture, wine producers are also seeking compensation because 180 million litres of wine will be coming in from the European Union. That is troubling as well. We have asked the Liberals to support the wine industry.

[Anne Minh-Thu Quach, NDP, Salaberry—Suroît, QC]

Madam Speaker, Bill C-30 concerns the implementation of the Canada–European Union Comprehensive Economic and Trade Agreement, or CETA.

Trade with Europe is much too important to be taken lightly. It is Quebec’s second largest trading partner. We export about $9 billion in goods and services, and a number of European companies, such as OVH, have set up operations in my riding, Salaberry—Suroît.

The NDP and I want to promote a stronger trade relationship between Canada and the European Union, although there are still major concerns and quite a few outstanding issues regarding this agreement. In Canada, like in Europe, this agreement has sparked a vigorous protest movement. In October, the regional government of Wallonia prevented Belgium from signing on to CETA; it believed that the investor-state provisions could adversely affect them, and several individuals, including some Canadians, also raised alarm bells and said that the matter needed another look. The Walloons agreed to sign on because they managed to retain their right to withhold consent to ratification if the investor-state provisions were not deleted or changed.

Our dairy producers expressed serious reservations about the impact of a massive amount of dairy products arriving on the Canadian market and on the Quebec market in particular. As well, a request for compensation was received this week from wine producers who fear losing their ability to produce here and their ability to sell on the Canadian market.

The Liberal government promised to compensate dairy producers, but this support falls far short of what they would find acceptable. Citizens groups have spoken up about how drug prices will be affected by changes to intellectual property and by generic drugs taking longer to get to market.

CETA is a source of concern for many. As the Dairy Farmers of Canada put it, CETA represents a 2% decline in dairy production, or Nova Scotia’s entire annual production. The dairy industry needs to be compensated for these losses.

The Conservatives had promised a $4.3 billion compensation package over 15 years to supply-managed farmers affected by CETA and the TPP. The current Liberal government decided to establish a fund of $350 million over five years for dairy producers.

The losses sustained by farmers will be permanent; they will not end five years from now. On top of that, the assistance being offered is paltry and not nearly enough to compensate this sector. According to the most conservative estimates, dairy farmers are going to lose $116 million a year.

The $50 million the Liberals are offering will therefore meet only 45% of the farmers' needs each year, which does not even cover the minimum losses that farmers are estimating. The Liberals have not appropriately compensated dairy farmers for the loss of market share.

In addition, the programs the Liberals have put in place are not meant to compensate farmers, but rather to modernize their production systems. The government is, in effect, denying that losses will occur under CETA.

The dairy farmers in my riding are already greatly affected by the diafiltered milk problem. American exporters are getting around Canadian laws by selling their diafiltered milk here. We need to enforce our cheese compositional standards immediately. The future of our dairy farmers, our family farms, and local jobs here in Canada is at stake. Across the country, the agrifood sector employs one in eight Canadians. We cannot ignore this sector when negotiating trade agreements with other countries.

It has been estimated that $200 million was lost in 2015. A farmer might lose $1,000 a week. The Liberals promised farmers that they would resolve the issue of diafiltered milk, but they have not lifted a finger so far. I am still waiting for news from the government, who is supposed to be helping farmers across Canada, as well as those in my riding, Salaberry—Suroît.

Trade relations also have to be based on equity between the partners and carried out in compliance with laws and regulations. CETA is worrisome in this regard as well. The investor-state provisions will allow foreign companies to challenge Canadian laws without going through our domestic courts.

There is so much uncertainty here that we have no idea how we can even appeal such claims or how members of the tribunal will be selected. We know full well that the companies will be able to hire foreign workers without a labour market impact assessment.

Municipal, provincial, or federal governments will no longer be able to require local employees be given priority without risking a trade challenge. Canada is already being sued and has won only three out of 39 cases against foreign investors in Canada. This is rather disconcerting.

In other words, any decision taken by any level of government could end in compensation for foreign companies. Canada is already one of the most sued countries under ISDS. This legal system has not been fully defined. We cannot give the Liberals carte blanche on this. There are many very important elements that could compromise our industries and our values.

The Liberals keep repeating that they cherish Canadian values. That is not evident in this bill. They are trying to ram it through. We even heard a member say that this bill must be passed before the end of the year. Knowing that 28 EU countries must ratify it and that this could take up to five years, why the urgency?

Why did the committee move a motion in camera to prevent those wanting to submit a brief from doing so? The committee is preventing everyone who will not appear as a witness from submitting a brief. In terms of transparency, accountability, and responsibility with respect to consultations, the Liberals are falling far short. Furthermore, they are not answering questions from farmers, wine producers, and producers from the east and the Maritimes who earn their living from the fishery. That is very troubling.

We cannot make an informed decision, for there is still much we do not know about the investor-state provisions. The Liberals also have not explained how they will protect environmental, health, and security regulations from foreign challenges.

The European states clearly indicated that this agreement would not be ratified unless the investor-state provisions were removed. Once again, the Liberals have not provided any information on this. Will they change these regulations? Will they provide a bit more information? As I said, there is a lot of uncertainty here.

The government is leaving us open to a situation where the agreement cannot be ratified by some countries in the European Union.

Let us talk about health. The changes set out in CETA may increase the cost of drugs for Canadians. The agreement will change the intellectual property rules regarding drugs. This will increase the cost of drugs by over $850 million a year, because it will take longer for generic drugs to reach the market.

Since Canada's population is aging, we will need access to drugs. This is just one more hardship for our seniors. There is no guarantee that they will be able to make ends meet since they are already struggling to put food on the table and get access to health care. Now, they may have to pay more for their medication.

The Canadian Federation of Nurses Unions has also warned that these regulations could make it more difficult to bring down prices with a national pharmacare program.

For all these reasons and more, I cannot vote in favour of this bill.

I hope that the Liberals will do the responsible thing and consult experts, reconsider some of their positions, and make informed decisions so that we sign an agreement that is truly fair to all workers and all Canadians.

[TJ Harvey, Liberal, Tobique—Mactaquac, NB]

Madam Speaker, I am pleased to rise today on Bill C-30, one of our government's blueprints for Canada's dynamic agriculture and agrifood industry.

Agriculture is hugely important in my riding, and has played an enormous role in my life, having grown up on a large farm and having produced myself. After finishing university and coming home, I was farming on my own, learning life's lessons through the farm. I worked within primary agriculture off the farm, and in food manufacturing and food processing.

It has really helped me throughout the years to become the person I am. I would like to thank my parents for giving me that opportunity. Growing up in an agricultural household has played a significant role in my life.

I was a supply-managed egg producer for six years, up until just recently. My wife and I recently exited the egg business. Over the last six years, I have had the ability to learn about a supply-managed system and the challenges and opportunities that evolve because of it. It has afforded me the opportunity in my life to learn those lessons, and to see the opportunity that agriculture offers to allow family operations to transition from one generation to the next, not only within primary agriculture but also through secondary and finished production as well. We can link these easily to CETA.

Canada is a medium-sized open economy. Our economic prosperity depends on an open trading environment. One in five Canadian jobs depends on trade. Canada's agriculture and food exports exceed $60 billion a year. Half the value of Canada's agricultural production is exported, which is why our government strongly supports free trade.

The Canada-European trade agreement demonstrates Canada's continued leadership with regard to the opportunities for Canada's farmers and food processors on the global stage, which has been nothing short of breathtaking. I hope it continues in that same fashion.

I believe CETA will allow agricultural producers to flourish. According to the Food and Agriculture Organization of the United Nations, the global demand for food is projected to increase by 60% by 2050. Much of this demand will come from the growing middle class around the world, which is on track to exceed half the planet's entire population over the next 15 years.

A lot of this production is not going to come from new agricultural operations. It is going to come from the growth that will be sustained through the industry, through people who are able to innovate and accept technology, and grow their businesses through that. This is good news for farmers in my riding and across the country. There is no doubt of the benefits CETA will bring Canada's agriculture and agrifood industry.

We are talking about access to Europe, a region that is among the world's largest market for food. That is why timely implementation of CETA remains a top priority for our government. Since taking government, 99.991% of my constituents believe in the global economy, and our government's efforts to place Canada on the world stage. When we are talking about agriculture in my riding, we are not only talking about dairy. We have a vibrant dairy sector, but we also have a very vibrant beef sector. We also have a very vibrant maple syrup manufacturing sector, so we need to look at the total picture and include all the industries when we talk about trade.

CETA will provide a strong foundation for Canada and the EU to demonstrate leadership on an inclusive, progressive approach to global trade. At the same time, we know that some sectors of agriculture will be impacted by CETA, namely our dairy and cheese producers under the supply-managed system.

While CETA does offer enormous opportunity for many of our farmers, such as our maple producers, beef producers, and aquaculture industry, there will also be greater access for European cheeses to Canada. Canada has provided additional access to the EU on two specific dairy products, cheese and milk protein substances. New imports of European cheese under CETA will represent 4% of Canadian cheese consumption and 1.4% of milk production overall. The supply-managed system has been preserved under CETA.

The Government of Canada fully supports supply management. In fact, we were the government that created it. That is something of which we are extremely proud. Supply management provides a fair return for farmers, stability for processors, and safe, high quality food products for consumers, something I know is important to many farmers in my riding and to constituents across the country.

We recognize the importance Canada's supply-managed sectors play in ensuring a strong rural economy, accounting for over 25,000 direct jobs and over $34 billion in overall economic benefit to the country.

As my colleague, the hon. Minister of Agriculture, likes to say, Canada has the responsibility and the ability to feed the world. We need look no farther than the innovation that has already occurred within the agriculture sector, and the ability to capitalize on the innovation in the future.

Canada is the fifth largest exporter and the sixth largest importer of agriculture and agrifood products in the world. With our small population and huge production capacity, Canada is today's world leader in agricultural trade on a per capita basis. Trade accounts for one out of every five jobs in Canada. Canada's dairy industry alone generates farm gate sales of $6 billion, and processing sales of $17 billion, and 22,000 direct jobs.

The hon. Minister of Agriculture and Agri-Food and his colleagues continue to consult closely with Canada's supply-managed sector regarding the transition through CETA.

The Minister of Agriculture has met with the Dairy Farmers of Canada, the Dairy Processors Association of Canada, provincial dairy associations from across the country, and young dairy producers. These meetings were very productive with many ideas and fresh thinking. Discussions mainly focused on how to strengthen the sector in the face of domestic and international challenges, and how to transition assistance for new markets under CETA.

Responding to these concerns, the government is committed to putting in place a transition package to help the sector adapt to the new CETA commitments. This government has said from the get go that we need to help dairy producers and processors make the transition when it comes to CETA.

That is why in early November, the Minister of Agriculture announced an investment of $350 million for two new programs to support the competitiveness of the dairy sector in anticipation of the entry into CETA. The government is supporting the continued strength of the dairy sector by helping ensuring dairy producers and processors continue to innovate and improve productivity.

The two new programs identify $250 million over five years for a dairy farm investment program that will provide targeted contributions to help Canadian dairy farmers update farm technologies and systems, and improve productivity through upgrades to their equipment. I have had over two dozen calls from dairy farmers wanting to know the specifics of these programs, when they will take effect, and how they can access these funds.

There will be $100 million over four years for a dairy processing investment fund that will help dairy processors modernize their operations and in turn improve their efficiency and productivity, as well as diversify their products to pursue new market opportunities. These programs will complement the dairy sector's ongoing investment efforts, help in both current and future generations of dairy farmers and processors to remain profitable over the long-term under a strong supply-managed system.

With regard to the allocation of CETA cheese quotas, the government is currently reviewing the results of the public engagement process that concluded at the end of August. The Minister of International Trade's decision will take stakeholder views and interests into consideration before determining how to allocate the new CETA cheese quotas.

The allocation policy for the cheese tariff rate quotas will be finalized following the passage of CETA implementation, legislation, and before the agreement enters into force.

While there are challenges, the Canadian dairy sector remains a progressive, innovative industry. The Canadian dairy farmers are doing a great job of meeting the needs of consumers on food quality, animal welfare, the environment and, of course, great tastes and high nutritional value of Canadian products.

Consumers love Canadian dairy products. Production continues to grow every year. Butter consumption has risen by 10% over the last decade. Yogourt consumption has increased over 60% during the same period, and is expected to continue growing.

Canadian dairy farmers are among the global leaders in their industry when it comes to the environment. Canada's dairy sector has a smaller footprint for carbon, water, and land than most other leading dairy industries around the world.

Today, Canadian dairy farmers are able to produce 14% more milk than they used to 20 years ago, thanks to better genetics, nutrition, and farm management practices. They are able to accomplish this with 24% fewer cows while producing 20% fewer greenhouse gas emissions. That is thanks to advances in animal genetics and nutrition.

Forward-thinking Canadian farmers have contributed to the success of the Canadian dairy industry in many ways. Canadian dairy genetics are exported to over 80 countries around the world, and of course, who can forget our famous Canadian cheeses which are winning top prizes at some of the world's leading competitions.

We all want a bright future for Canada's dairy sector. The agricultural sector continues to create jobs and be a leader in innovation, not only within the dairy sector but across our agricultural industries.

To help build that future, we are investing in science—

[Mark Eyking, Liberal, Sydney—Victoria, NS]

Mr. Speaker, I am honoured to rise in the House today to speak to Bill C-30. I commend all my colleagues in this House who have spoken to this bill over the last few days. It is a very important bill. I especially commend the member for New Brunswick Southwest, who made a great statement today on this bill. I would also like to recognize our trade minister for all the hard work she has done on this file. She has worked extremely hard on this important agreement, and along with our Prime Minister, on representing Canada across the world as an open, trading country.

I would also like to give recognition to our international trade committee, which I am very proud to sit on as the chair. I would like to thank the members of the committee for their work and engagement during this process. It is a very active committee. We are dealing with softwood lumber and problems with the meat sector in the United States. We also, over the last year, had a dialogue with Canadians and stakeholders on the TPP. We went right across the country. We had thousands of people come forward. During those proceedings, for the first time, the committee had an open mic at the end of each meeting, so we had a lot of feedback on the TPP across this country.

I am here to talk about the agreement with the European Union. Recently we had an excellent meeting with the European Economic and Social Committee, and we will continue to work closely with our European counterparts. They are very excited about this agreement.

Thinking of how Canada was formed, we go back hundreds of years. I guess it was 400 years ago that trade started between Europe and Canada. At that time, it probably started off with fishermen, with probably Spanish and Portuguese fishermen coming and getting fish and trading it back and forth. Other immigrants came over the years and created trade. We had farmers, and of course, the fur industry was another big one, with the voyageurs. Trade with Europe was very important in the early years, and it still is.

As the country expanded and immigrants came, most were from Europe. Ukrainian people came over. A lot of them are in my riding, but many of them went out west and developed the grain fields, and those products were traded back and forth.

Our connection with Europe goes way back, with over 400 years of trade. That continues to be so, though many of the products have changed.

The proposed comprehensive economic and trade agreement with the European Union is a modern, progressive trade agreement that, when implemented, will generate billions of dollars in bilateral trade and investment, providing greater choice and lower prices for consumers and creating middle-class jobs in many sectors. That is what our government stands for. We want to increase the middle class and have it do better, and trade is important. Countries that trade have a larger middle class and have more efficient and competitive industries.

CETA is the product of hard work and frank discussions. We have some of the best negotiators in the world on our team. There was a lot of commitment from our Prime Minister and the Minister of International Trade, our committee, and countless other people behind the scenes. I also have to commend the work of the former Conservative government on this agreement. The Conservatives set the groundwork for this. They started the negotiations, and they did a good job. They did not finish it, but they started the process, and we finished it. I have to commend the former Conservative government for initiating this, getting it going, and making it happen.

Negotiating a trade agreement such as the Canada-European comprehensive economic and trade agreement benefits Canadians. It creates new job opportunities and helps many people. The United States is still our biggest trading partner, but we have to look at other markets and see other trading partners. The European Union is tremendous. I think there are over 500 million citizens there. It is a big market, and they want our products. Canada's exports to the EU are diverse and include a significant share of value-added products in addition to traditional exports of resource-based products and commodities.

We have precious stones and metals. We have machinery and equipment. Minerals, fuels and oil, mineral ores, aerospace products, and fish and fish products are some of the top merchandise we sell to the EU.

Atlantic Canada, where I am from, Cape Breton, Nova Scotia, is closest to Europe. This will be a big advantage for us. Our two export sectors that will particularly benefit from CETA will be metals and mineral products, and of course, the fishing sector.

In Atlantic Canada, we have more than 400 small harbours. They each have 20 or 30 boats. We cannot eat all the fish in Atlantic Canada, and the rest of the world wants our fish, so it is very important that we have markets around the world for our fish products.

When it comes to exporting our products, Atlantic Canada has ports we can ship from. We ship our products year round. We have good deepwater ports that are ice free. We are two days closer than many other ports, such as Montreal, Boston, and New York. Atlantic Canada is well-positioned to do well, not only with products but by being the entry and exit point for products coming and going.

My home province of Nova Scotia will benefit significantly from CETA and will have preferable access to the EU market. The EU is Nova Scotia's second-largest export destination, and it is its second-largest trading partner, with a large portion of that share coming right from my island of Cape Breton.

Once in force, CETA will remove the boundaries for Nova Scotia exports and will create new markets and opportunities in the EU. Nova Scotia will benefit from improved exporting conditions. CETA will provide us with a competitive advantage over exporters in other countries that do not have free trade agreements with the EU. The United States tried to do an agreement like we did, but it did not succeed.

I have a neighbour in Cape Breton who is from Germany. His company is called PolyTech windows. They are beautiful windows. He is looking at making the windows in Nova Scotia and exporting them to the United States. We will not only benefit back and forth but we will be a gateway into the United States for a lot of products from the Europeans that we can add value to in Canada.

Between 2013 and 2015, Nova Scotia's merchandise exports to the EU were worth $465 million. As I said, fish and fish products were the largest share, at 45% of exports. Following fish and fish products were agriculture and agrifood.

Nova Scotia is unique. We have a lot of different products that have great potential, whether it is potatoes, blueberries, apples, or even beef. We have good beef in Atlantic Canada. It is grass-fed beef, and that is what Europeans like, so we have a great opportunity.

I visited an operation in Lunenburg where they grow the haskap berry, which is a very nutritious product. They are looking at exporting that product to the EU and doubling their production.

When we look at all these different products we can trade and sell, we have a great opportunity.

This important agreement also hits home on a personal note. My parents came to Canada from the Netherlands. They came to Cape Breton, and that is where we started our farm. We also trade. We sell strawberries to Iceland, calves to the Caribbean, and lettuce to the United States. As farmers, and as we have heard from farmers right across this country, whether it is beef farmers, canola farmers, or pork producers, we see this as a big opportunity.

In closing, when other countries are closing their doors to trade and immigrants, Canada is opening our doors. The benefits as a result of CETA for the Atlantic provinces are going to be tremendous. CETA is a modern, progressive trade agreement that could generate billions of dollars in bilateral trade and investment and provide greater choice and lower prices for consumers.

The House resumed from November 23 consideration of the motion that Bill C-30, An Act to implement the Comprehensive Economic and Trade Agreement between Canada and the European Union and its Member States and to provide for certain other measures, be read the second time and referred to a committee.

Business of the House

[Bardish Chagger, Liberal, Leader of the Government in the House of Commons and Minister of Small Business and Tourism]

Mr. Speaker, today we are continuing with opposition day. Tomorrow the House will consider the report stage of Bill C-29, the second budget bill, and it will continue studying that bill Monday and Tuesday of next week.

For the remainder of the week, we plan to call the following bills: Bill S-4, the tax conventions legislation, and Bill S-3, the Indian tax amendment, provided we get these two bills from the Senate; Bill C-25, the business frameworks bill; and Bill C-30 concerning CETA. All these bills are at second reading.

It is my hope that parties will be able to negotiate on how to proceed in advancing these very important initiatives. Something I have committed to is working well with other parties, and I will continue to do that.

[Marvin Hildebrand, Chief Negotiator, Canada-Ukraine Free Trade Agreement, and Director General, Market Access, Department of Foreign Affairs, Trade and Development]

Thank you very much, Mr. Chairman.

Good morning to all the committee members.

Perhaps I will begin by briefly introducing my colleagues at the table. Alessandro Longo is with Agriculture and Agri-Food Canada. Brooke Davis is with Global Affairs Canada and is the deputy chief negotiator on this initiative. Stacy-Paul Healy is with the legal bureau at Global Affairs. Pierre Bouchard is from Employment and Social Development Canada. He was one of the negotiators on this deal, as were Stacy-Paul and Alessandro. Pierre, obviously, was involved in the labour chapter of the agreement.

Mr. Chairman, if I may, I will give a very brief opening set of remarks, focusing on Bill C-31, which is the legislation in question here concerning the Canada-Ukraine free trade agreement. The bill, of course, is called the Canada-Ukraine Free Trade Agreement Implementation Act.

Canada already complies with many of the obligations under the Canada-Ukraine FTA, or CUFTA, as we refer to it. However, before this agreement can be brought into force, a statutory authority is required for Canada to implement some of the provisions of the agreement.

Bill C-31 contains the provisions typically found in an implementing bill for Canada's bilateral free trade agreements. These essentially fall into three groups: one, authority to implement institutional provisions of the agreement; two, amendments to Canadian law necessary to implement the agreement; and three, coordinating amendments.

Bill C-31 starts with provisions to enable Canada to implement the institutional provisions of CUFTA—for example, establishing the authority for ministers to appoint individuals to committees and to dispute settlement panels and other bodies established under the agreement, and also the authority for the Government of Canada to pay its share of expenses related to the operation of the agreement. Bill C-31 also authorizes the Governor in Council to make orders for carrying out provisions of the act, such as the suspension of benefits following dispute settlement.

Second—and this is the second group of elements of Bill C-31—the bill amends seven existing Canadian laws to enable the implementation of CUFTA. At the heart of these changes are amendments to the customs tariff to implement preferential tariffs for Ukrainian goods in line with the market access provisions in the agreement. There are also changes to the Customs Act that support these market access provisions. An example is authority to check whether goods qualify for tariff preferences under the agreement and to provide advanced rulings to assist companies in knowing how goods will be treated under the agreement.

The customs tariff and the Canadian International Trade Tribunal Act are also being amended to implement provisions related to bilateral safeguard measures that may be taken if injury is caused to domestic producers due to increased imports.

The dispute settlement mechanism in the labour chapter of the agreement can result in a monetary assessment made enforceable in domestic law through amendments to the Crown Liability and Proceedings Act and the Department of Employment and Social Development Act. There are also amendments to the Financial Administration Act to authorize the Governor in Council to issue directives to crown corporations for the purpose of implementing the agreement.

Third, Bill C-31 contains amendments to coordinate with Bill C-30, which is the Canada-EU Comprehensive Economic and Trade Agreement implementing legislation. Because both bills amend the same parts of the Customs Act, the coordinating amendments ensure that the amendments made by Bill C-30 do not undo the amendments made by Bill C-31, and vice versa.

That provides a brief overview of the contents of Bill C-31, Mr. Chairman.

I would be happy to address any questions that you or other committee members might have.

[Jim Keon]

With respect to retroactivity, the provisions of Bill C-30 should apply, in terms of this patent extension or certificates of supplementary protection, only to products approved after the coming into force of CETA. The amendment we have makes that absolutely clear, and I'm hoping it will be done.

On combination products, we're concerned more about evergreening, a term that's sometimes used, whereby protection goes to an underlying molecule. It gets an extension, and it's combined with a further molecule to produce a combination product, which can have a separate approval. If there have already been extensions for the underlying products, we don't think the extension product should also get extra protection. This has happened in Europe. Our colleagues in the European Generic and Biosimilar Medicines Association have told us this, and they have encouraged us to be very careful with it. We're proposing this amendment to try to make sure this doesn't occur in Canada.

[Tracey Ramsey, NDP, Essex, ON]

Okay, so we'll welcome those changes that you'll supply to the committee for those amendments.

Gus, I want to go to you quickly before you have to go.

You've also raised some amendments to the ISDS and to the chapters there that we are looking at. I think one of the things you mentioned is important and is a big piece of this. Right now, the way it stands is that it's being provisionally applied, and we're mirroring that here, although it's not entrenched in the legislation we have going forward. At this point we're basically signing on to the court system without any clear definition of what that is.

If a member state requests the removal of the investor-state provisions as a precondition for ratification, but here in Canada we pass Bill C-30 with the ISDS ICS included, what position will that leave us in here in Canada?

[Jim Keon]

There are two aspects to that. From a cost perspective, as I've said, generics on average now are selling at something like 20% to 25% of the price of an equivalent brand-name product. If you delay for two years, you're paying an extra 75% to 80% on that product for an extra two years. That affects provincial drug program budgets; it affects employee plans; and it affects people who pay out of pocket, and those costs are very significant.

Second, it is very important that we have a strong generic industrial base. We manufacture products here. We sell, as I've said, to over 115 countries. It is critically important that we're able to get on the market when patents expire in Canada and around the world. One aspect of Bill C-30 we do support strongly is this ability to export during the extension period. That is very important. We are very supportive of that, and in our view, it's nicely drafted and should go forward.

[Gerry Ritz, Conservative, Battlefords—Lloydminster, SK]

I'm sure the Liberals want to be fair too. If they're just for housekeeping, then using Bill C-30 to do housekeeping may not be the right way to do that.

Mr. Van Harten, I will turn to you since I understand you have to leave soon.

You talked about the minister being the only person involved in the appointment of the adjudicators in the ISDS, whenever this is applied after this provisional hiatus that we're talking about. How else would you see that being done? What would be your recommendations?

[Jim Keon, President, Canadian Generic Pharmaceutical Association]

Thank you very much.

It's nice to be back here. We were here not too long ago talking about the TPP agreement as well, which also affects pharmaceuticals.

The generic pharmaceutical companies in Canada, our industry, are primarily pharmaceutical manufacturers and exporters, and they are among the top R and D spenders across all industrial sectors. Our members operate the largest life sciences companies in Ontario and Quebec and directly employ more than 11,000 Canadians in highly skilled research, development, and manufacturing positions.

We are strong supporters of free and open trade, and we export quality made-in-Canada generic medicines to 115 countries. Our industry also plays a significant role in controlling health care costs. Generic drugs are now dispensed to fill 70% of all prescriptions in Canada but account for only 22% of the $26 billion Canadians spend annually on prescription medicines. Five or six generic prescriptions can be filled for the cost of one brand-name prescription today.

The outcome of CETA will require two main changes to Canada's pharmaceutical intellectual property laws. The first is called certificates of supplementary protection. This is the implementation of an entirely new IP, or intellectual property, measure for Canada. It will provide for two extra years of market monopoly for all new drugs in Canada. Importantly, generic pharmaceutical companies will be permitted to export from Canada during the period of additional protection. Most of the pharmaceutical IP text in Bill C-30 covers the implementation of certificates of supplementary protection.

The second large area in which changes will be required as a result of CETA is our PM(NOC) regulations, which involve the complex litigation system for pharmaceuticals in Canada, sometimes referred to as the patent linkage system. The details of these reforms will be spelled out in regulations, and draft regulations will not be published until sometime after Bill C-30 receives royal assent.

CGPA supports the general direction of the changes, which should address long-standing concerns of the generic pharmaceutical industry, such as the lack of finality to proceedings and the insufficient damages available for injured generic parties. That said, the devil will be in the details. At this point, we are both optimistic and uneasy about the impending changes.

Bill C-30 represents the most extensive legislative changes to Canada's pharmaceutical intellectual property laws in more than 20 years. In addition to provisions required to implement CETA, Bill C-30 also includes changes to the Patent Act that in some cases go beyond the requirements of CETA, and that is concerning to us.

CGPA has filed a submission with the clerk recommending six amendments to Bill C-30. On SPCs, supplementary protection certificates, CGPA believes officials generally did a very good job of drafting clear provisions that track the letter and spirit of the CETA commitments in this area. That said, we have identified three priority amendments for the consideration of the committee.

First, CGPA is proposing an amendment to make it absolutely clear that there will be no retroactivity of the SPC provisions.

Second, CGPA is proposing an amendment that would address circumstances under which a combination product can be eligible for a certificate of supplementary protection. We feel this detail is far too important to be left to regulations.

Third, CGPA is proposing a cap on the total period of drug monopoly that can be granted for a certificate of supplementary protection that's calculated from the date of market authorization. Such a safeguard exists in both the European Union and the United States.

We are proposing three other specific amendments to Bill C-30. The first pertains to what we believe are unintended consequences associated with the repeal of section 62, which has implications beyond the pharmaceutical sector. We propose that the substantive text from section 62 be reinstated.

The two amendments we are proposing pertain to concerns we have with respect to subsection 55.2(4) of the Patent Act, which is a critical provision for pharmaceutical IP litigation. CGPA is concerned that the changes to this subsection would facilitate the creation of new substantive rights or obligations that would be harmful to the generic pharmaceutical industry. At a minimum, the adoption of the changes would introduce more uncertainty into Canadian pharmaceutical IP law. These changes are not required by CETA. We have proposed that the existing language in the act be reinstated in both instances.

Now, these are overly simplistic descriptions of the issues, but we would be pleased to address them in greater detail if members have an interest. It is obviously impossible to cover such an important and complicated area in five minutes.

In addition to our proposed amendments, there are many other aspects that I would be pleased to speak to in the question-and-answer session, including the impact of the new measures on drug costs, and the role of pharmaceutical intellectual property in trade agreements.

While my remarks today were in English, we would be pleased to answer any questions you may have in either English or French.

Thank you.

[Dr. Gus Van Harten, Professor of Law, Osgoode Hall Law School, York University, As an Individual]

Thank you very much, Mr. Chair. I want to apologize in advance because I will have to leave at 12:20, since I will have a roomful of students waiting for me at 12:30. I'd like to thank you very much for the opportunity to present to you.

I'm going to make five very quick points about Bill C-30. First of all, and this may not surprise you, I don't think the foreign investor protection provisions in CETA are a good idea in the relationship between Canada and Europe. My view is that the inclusion of chapter eight in particular and article 13.21 of CETA are imprudent and not a justified concession of Canadian sovereignty. But I won't dwell on that point, because my written submission to the committee goes on at length about it.

The next four points are much more specific. My second is that Bill C-30 says in clause 9 that the agreement is approved. I think that raises an important question, namely, what about the agreement is being approved?” We know that portions of the agreement will not be provisionally applied in Europe, particularly those related to chapter eight and article 13.21 of the foreign investment protection provisions, and we know that there's uncertainty about how those provisions are going to fare in Europe at the European Court of Justice, in member states, and so on. There's even a prospect that the agreement as a whole will never be ratified in Europe. So why wouldn't clause 9 say something like “the agreement is approved for provisional application in Canada to the extent that it has been approved for provisional application by the European Union and European member states as applicable”? Because otherwise, Canada is in the position of unilaterally approving parts of the agreement and exposing ourselves to costs and risks of foreign investor claims when the other side to the agreement hasn't done the same.

That brings me to my third point, a very quick one. In subclause 8(3) there's reference to causes of action being allowed under the agreement in Canadian law based on chapter eight, the foreign investor protection provisions. That's just an indicator of how in this legislation, Parliament would apparently be approving one-way claims against Canada without the same right being available to Canadian investors under CETA due to the provisional application approach.

Maybe the federal government has a good answer to that point, but as the legislation is drafted, it seems to me very much open to the criticism that we haven't clarified which parts of the agreement we're applying and which parts we aren't.

Very quickly, in clause 11 the Minister of Trade is given the power to appoint the members of the roster under chapter 8. I just want to stress that this is a very significant power, because we could think of the members of that roster as, very simply, almost equivalent to Supreme Court of Canada judges in the extent of their powers to review the passage of laws, passage of regulations, and so on in Canada. Especially when it comes to deciding the budgetary implications of laws, members of that chapter eight roster will, I think it's fair to say, have even greater power than would Supreme Court of Canada judges in Canada. So to give the power to choose the roster members to one minister only, the Trade Minister, is too narrow, and it would be advisable to think about a more broadly based, publicly representative process to allow for appointment of those roster members, because they're going to be extraordinarily powerful—much more powerful than the other adjudicators who are appointed by other ministers pursuant to clause 11.

The last point is that in the case of chapter eight of the agreement, because there is this uncertainty about what the Europeans are going to do—they're talking about making it a fully judicial process, and about a multilateral court option—it seems to me to be putting the cart before the horse to be approving chapter eight in this legislation when we don't actually know what the final version of chapter eight may look like, and it could look very different once the Europeans are finished with it. For that reason I think it really calls for a pause with respect to those parts of the agreement that are not approved in Europe.

Thank you very much for the opportunity.

[Lawrence MacAulay, Liberal, Minister of Agriculture and Agri-Food]

Thank you very much, Mr. Chair. I'm pleased to be back.

Bonjour tout le monde.

I want to take this opportunity to thank the committee for its outstanding work to support the agricultural sector. I know you've been working hard recently on Canada's next agricultural policy framework, and I've been hearing from many agricultural groups and Canadians. I want to congratulate you for your dedication to this important topic for our agricultural sector, and I look forward to reading your report when it's finished.

I also appreciate your concern on the bovine TB situation in Alberta and Saskatchewan. It's a very difficult situation for our producers. As the investigation proceeds, we are doing everything we can to minimize disruptions to producer businesses while ensuring the protection of human and animal health.

We are exploring all options to producers whose farms are under quarantine. We are working hard with Alberta to implement an AgriRecovery initiative as quickly as possible to cover extra costs faced by producers experiencing this income decline. This would help provide financial assistance for extraordinary costs related to feed and water infrastructure, feed for the animals, transportation, as well as interest costs on loans due to the circumstances. Producers can also access immediate help to cover the costs they are facing under the advance payments program.

I have instructed my department and the CFIA to ensure that all those affected have the latest information as it becomes available. We have approved having a feedlot set up for quarantined calves and are working with the industry on this. Once they identify a suitable location, we can begin the work quickly.

I want to assure the committee and all those affected by this terrible situation that we will spare no efforts in helping get our world-class cattle producers back on their feet again. Being a farmer, I understand the difficulty of this situation and the pressures these ranchers are facing.

Moving on to today's topic of the supplementary estimates, our government is pleased to work with you to advance Canada's agriculture and agrifood industry. Our commitment to the sector is shown in the supplementary estimates you have before you. The estimates have increased by over $23 million, to a total of $2.34 billion.

This will support joint initiatives under Growing Forward 2 with the provinces and territories. These are targeted at competitiveness, market development, innovation, adaptability, and industry capacity; the agricultural youth green jobs initiative; and investments under the AgriMarketing program to support our free trade agreements and negotiations, and to work with industry to open doors in global markets.

Today I'm also pleased to update the committee on our government's work for the sector since our last meeting, specifically our work on three important priorities—trade, innovation, and the next policy framework.

As you know, trade is vital to the success of the sector. Canada exports about half of the value of its entire agricultural food production. Canada is a top-five agricultural food exporter, with exports hitting new records every year, so it was tremendous news when the Prime Minister and the president of the EU signed CETA.

CETA will eliminate tariffs on virtually all Canadian agrifood exports to one of the world's largest markets for food. CETA could boost Canada's agriculture and food exports to the European Union by $1.5 billion. That's good for our farm businesses, good for jobs, and good for economic growth across the country. Our government has introduced legislation to implement this landmark agreement under Bill C-30. At the same time, we're supporting our supply management by helping Canada's dairy industry adjust to increased access to European cheeses under CETA. We have consulted closely with the sector on the best way forward.

Three weeks ago, we announced a federal investment of $350 million to help dairy producers and processors adapt to CETA through investments in new equipment and technologies. Our goal is to help Canada's dairy sector grow and thrive so that it can take advantage of new market opportunities and address domestic and international pressures. We are working with the Canadian dairy sector to make it more competitive and to make sure that Canada's supply management remains strong for generations.

In the coming weeks, we will consult with the dairy sector to seek input on these programs. Both programs will be in place when CETA comes into force. We have also moved to support supply management initiatives such as the duties relief program and spent fowl.

Canada's Border Services Agency has sanctioned five users under the duties relief program who were improperly selling supply management commodities in the Canadian market without reporting these sales and without paying the required duties. We will sit down with industry to look at potential changes to the duties relief program and the import for re-export program. We will look at specific options regarding certification requirements for imports of spent fowl while ensuring that any such requirement would be fully consistent with Canada's international trade obligations. At the same time, officials are addressing the feasibility of a DNA test to screen imports of spent fowl at the border.

Mr. Chair, this is another example of our government's support for the supply management program. Along with Europe, another key market for Canadian farmers and food processors is China. I am just back from a major trade mission to China. We showcased Canada's world-class food, beverages, and seafood— from blueberries to beef, canola, lobster, and maple syrup—with a focus on the rapidly growing e-commerce market.

I was pleased to host events and attend trade shows to promote our products. Industry representatives have reported that these events have led to some $37 million in on-site sales and $230 million in anticipated sales over the next year.

Canada is China's second-largest customer for agriculture and agrifood with a middle class growing by the population of Canada every year.

We have set a goal of doubling the trade between the two countries by 2025. We have also agreed to expand access to Canadian beef to China as well as to continue canola exports, which average $2 billion a year.

Colleagues, when we talk trade, we must talk transportation, as they go together. You can't have one without the other. That is why our government would introduce legislation to strengthen Canada's rail transportation system, address key industry concerns such as reciprocal penalties, better define adequate and suitable service in the Canada Transportation Act, and improve access and timelines for the Canadian Transportation Agency decisions. In early 2017 we will also address the future of extended interswitching limits and the maximum revenue entitlement. Farmers have certainly indicated their appreciation for the steps we are taking. Our government will continue our work to improve the grain transportation system in this country.

Innovation is also critical to ensuring the sector can continue to take advantage of global market opportunities and keep the industry on the cutting edge. As you know, innovation is very important to our government and to me. Research and development lies at the heart of Canada's global agricultural success. Our ongoing private and public sector investments in research will be critical to Canada's ability to help feed the world and keep Canadian agriculture on the cutting edge.

For example, last month in Vineland, Ontario, I announced a federal investment of up to $920,000. This initiative will help Vineland Research and Innovation Centre develop tomato and apple varieties that are resistant to disease. That will help both the environment and the farmer's bottom line while boosting productivity for domestic and export sales.

We continue to strengthen the Canadian agricultural sector through key investments in discovery science and innovation. Our government is also investing in programs to help farmers take action on the environment, including a $27-million investment in the agricultural greenhouse gases program.

Mr. Chair, your committee is continuing its work on the next agricultural framework. Promising opportunities lie ahead for the Canadian agriculture and food industry.

A rising population and rising incomes will continue to drive demand for Canada's world-class food. We continue to hold extensive consultations with the industry, provinces, and territories. I know you are doing so as well. We certainly look forward to the result and looking at your study.

I look forward to working with you and all stakeholders to help Canadian farmers and food processors continue to keep Canadian agriculture strong and growing.

Mr. Chair, I thank you very much. Merci.