Bill C-18 (Historical)

Canada—United Kingdom Trade Continuity Agreement Implementation Act

An Act to implement the Agreement on Trade Continuity between Canada and the United Kingdom of Great Britain and Northern Ireland

This enactment implements the Agreement on Trade Continuity between Canada and the United Kingdom of Great Britain and Northern Ireland.
The general provisions of the enactment set out rules of interpretation and specify that no recourse is to be taken on the basis of sections 10 to 15 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, provides for the payment by Canada of its share of the expenditures associated with the operation of the institutional and administrative aspects of the Agreement and gives the Governor in Council the power 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 contains a transitional provision.
Part 3 contains a coordinating amendment and the coming-into-force provision.

Canada-United Kingdom Trade Continuity Agreement Implementation Act

[Mary Ng, Liberal, Minister of Small Business]

moved that Bill C-18, An Act to implement the Agreement on Trade Continuity between Canada and the United Kingdom of Great Britain and Northern Ireland, be read the second time and referred to a committee.

Mr. Speaker, I am seeking unanimous consent to split my time with the member of Parliament for Outremont.

[The Speaker, Anthony Rota]

This being a hybrid sitting of the House, for the sake of clarity I will only ask those who are opposed to the request to express their disagreement.

Accordingly, all those opposed to the hon. minister’s request will please say nay.

Hearing no opposition, I declare the request granted.

Now I will let the minister continue.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Mr. Speaker, it is my pleasure to rise virtually in the House of Commons today in support of Bill C-18, an act to implement the Agreement on Trade Continuity between Canada and the United Kingdom of Great Britain and Northern Ireland.

The United Kingdom is our largest trade market in Europe, and in 2019 it was the third-largest destination for Canadian merchandise exports worldwide. It was also a key source of innovation, science and technology partnerships. Two-way merchandise trade between Canada and the United Kingdom totalled $29 billion in 2019, making it our fifth-largest international trading partner. The U.K. is also Canada's second-largest services trade partner, behind only the United States, amounting to exports of nearly $7.1 billion last year. Finally, the U.K. is Canada's fourth-largest source of foreign direct investment, valued at $62.3 billion in 2019.

It is clear that the Trade Continuity Agreement with the U.K. is critical to Canadian jobs by preserving a key enabler of our strong economic partnership, which is CETA. Because it is based on CETA, this agreement provides familiarity, continuity, predictability and stability for Canadian businesses, exporters, workers and consumers, which is more important than ever today as we grapple with COVID-19.

Once the agreement is fully implemented, it will carry forward CETA's tariff elimination on 99% of Canadian products exported to the United Kingdom. It will fully protect Canadian producers of all supply-managed products. It will maintain priority market access for Canadian service suppliers, including access to the U.K. government's procurement market, which is estimated to be worth approximately $118 billion annually, and it will uphold and preserve CETA's high standard provisions on labour, dispute settlement and the protection of the environment.

Canada has a deep and historic relationship with the United Kingdom, one of our closest allies, from NATO, the G7 and the G20 to the ties of shared history, values and respect for the principles of democracy. When the United Kingdom held a referendum and, guided by the decision of its citizens, decided to leave the European Union, that decision not only affected the U.K.'s trade and economic relations with its largest partner, but it also meant that the United Kingdom would no longer be a part of CETA with Canada. Obviously, this had a potential effect on Canadian companies and businesses. That is why this trade continuity agreement is so important.

Canadian businesses and workers in many sectors rely on our interconnected trade relationship, from farmers and fish harvesters to financial service providers and innovators. They have told us that what they want most at this time is stability. This agreement provides exactly that. The TCA, Trade Continuity Agreement, ensures Canada and the U.K. can both sustain and build upon our important relationship by preserving the benefits of CETA on a bilateral basis while fully protecting our closely integrated supply chains and continued access for our exporters.

This continuity agreement is good for workers, it is good for business and it is good for both Canada and the United Kingdom. Without the TCA in place, Canadian businesses could have faced the uncertainty of new barriers and higher costs of doing business, particularly for our agriculture, fish and seafood industries. With this agreement, we can build a better future for both countries.

International trade is central to Canada's economic success and prosperity, and there is no doubt that trade will play a crucial role in our inclusive and sustainable recovery from COVID-19. It is important for Canada to not only develop new trading relationships, but to also maintain and strengthen our existing ties. The TCA is not just about maintaining the CETA agreement. In fact, it sets the stage for an exciting new chapter in our future trade relations with the United Kingdom.

With the TCA, we will ensure immediate certainty for Canada-U.K. trade by replicating CETA on a bilateral basis, as the U.K. has left the EU. However, Canada has always said that, for the longer term, we are interested in the negotiation of a new, modern and ambitious agreement that can best reflect the Canada-U.K. bilateral relationship going forward.

The TCA includes a commitment for subsequent negotiations to begin within a year of its entry into force. My U.K. counterpart, Secretary Truss, and I have publicly committed to these negotiations. We will see input of Canadians from coast to coast to coast through public consultations on their interests in a new bilateral discussion with the United Kingdom.

I look forward to returning to the negotiating table within one year of the TCA's ratification to work on a new, high-quality, modern, inclusive and comprehensive economic partnership that includes ambitious chapters for small businesses, the environment, labour, digital trade and women's economic empowerment. To those who have pointed out areas where improvements are needed, we hear them, and I am eager to get to work on those issues. We will return to the House when we are ready to table negotiating objectives for this new, ambitious effort.

While we work to ratify this agreement both in Canada and in the United Kingdom, we have signed a memorandum of understanding between both countries so that trade can continue to flow while this agreement makes its way through domestic approvals in both countries. As we have negotiated both through the MOU and the Canada-U.K. TCA, businesses will continue trading at the preferential tariff rates under CETA with no additional paperwork. The TCA will provide stability and remain in place until a new agreement, which we aim to reach within three years, is ready.

With the TCA, we are seeking to ensure continuity. The last thing Canada and the United Kingdom would want to do is create any uncertainty for businesses and workers, particularly as we respond to the pandemic, restart our economies and begin to build back better.

The year 2020 has been incredibly difficult for workers and businesses across the country. For so many sectors, this agreement is exactly the continuity and stability that they have asked for. It is what we need to support Canadian jobs and families, and to grow our economy through trade and export with one of our closest allies at an economically challenging time. While CETA will continue to govern Canada-EU trade, this agreement will provide similar predictability for Canadian businesses that trade with the U.K., ensuring trade between our two countries continues to flow uninterrupted.

I will conclude by saying, as I have said before, that the trade continuity agreement with the U.K. is good for Canadians, it is good for the people of the U.K., and it is good for the strong, mutually beneficial relationship our nations have built over more than 150 years.

Therefore, I urge all hon. members to support Bill C-18 so that Canada can bring the Canada-U.K. trade continuity agreement into force as soon as possible.

[Leona Alleslev, Conservative, Aurora—Oak Ridges—Richmond Hill, ON]

Mr. Speaker, there is no question that this agreement is very important to Canada and, of course, we need to look at stability and certainty, but could my hon. colleague give us some of the areas that she feels need to be negotiated in the future?

My hon. colleague outlined that there need to be some ambitious broader targets for an agreement with the U.K. in the future, which would be a priority so that we could go beyond this agreement.

Could she share with Canadians what the government's perspective is on the top three areas that need to be included in those ambitious and new modernized areas of this agreement?

[Mary Ng, Liberal, Markham—Thornhill, ON]

Mr. Speaker, happy new year to my hon. colleague. We have a commitment through the TCA to get back to the negotiating table. I am very much looking forward to those negotiations with our close ally, the U.K., and to having areas of common interest and common ambition such as the environment, labour, digital trade, which is so important coming out of COVID-19, inclusion for small and medium-sized businesses and women's economic empowerment.

I would also like to say that I think it is really important to hear from Canadians. We are committed to making sure that we talk to Canadians and businesses, that we hear from them about what is really important in this new agreement, and that we take their input into perspective. We of course—

[The Deputy Speaker, Bruce Stanton]

We will just leave that thought there for a moment. We are going to try and get a couple more questions in.

The hon. member for Avignon—La Mitis—Matane—Matapédia.

[Kristina Michaud, Bloc, Avignon—La Mitis—Matane—Matapédia, QC]

Mr. Speaker, I thank the minister for her speech.

Of course we support this bill that is so important for businesses in Quebec and the rest of Canada since it enables us to continue our trade relations with the United Kingdom. However, we object to the lack of transparency. During negotiations with the United Kingdom, the parties did not have access to the various texts at the Standing Committee on International Trade. That is a rather blatant lack of transparency, and I would like the minister to explain why the various parties did not have access to those documents.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Mr. Speaker, that is an important question. We have been fully transparent with Canadians throughout our trade dialogue with the United Kingdom.

In September of 2017, our Prime Minister met with then U.K. prime minister Theresa May when it was first publicly announced that we were going to ensure a seamless transition of trade with the U.K. as it prepared to exit the EU. During that time, while the EU was still part of CETA, it was not able to undertake any new international negotiations, so our discussions focused on converting the terms of CETA, making it available and creating a bilateral agreement between Canada and the U.K. We are looking forward to getting back to the negotiating table.

Around transparency, I want to reiterate to our colleague that we will adhere to the commitments we have made and fulfill obligations under the amendments to the policy on tabling treaties. We are going to be hearing from Canadians about what they are looking for in the upcoming negotiations—

[The Deputy Speaker, Bruce Stanton]

I will just interrupt the minister. We will get one more question in on this round.

The hon. member for Timmins—James Bay.

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

Mr. Speaker, I would like to ask the hon. minister about the recent unanimous motions, from both the foreign affairs and international affairs committees, calling on Canada in these trade agreements to ensure that England respects its obligations under the Good Friday Agreement to the people of Ireland, to make sure we have an open border, and to make sure that support is in place for a referendum on Irish unity. There has been a lot of mistrust in the EU about Boris Johnson's attitudes towards Ireland.

Canada has deep roots in this. We have a long-standing history in the Good Friday Agreement, so I am asking the minister what kind of commitment she will make to ensure that England lives up to its obligations on the Good Friday Agreement and the open border with the Irish people.

[Mary Ng, Liberal, Markham—Thornhill, ON]

Mr. Speaker, that is a very important question. Canada being a supporter and, in fact, a leader with respect to the Good Friday Agreement, I would agree it is good to see that the United Kingdom has agreed to that.

As we go forward with new negotiations, we will have an absolute opportunity to make sure that we are listening to Canadians, and the perspective of Canadians, just like that offered by my hon. colleague on those negotiations. We have also committed, through our amendments to the policy of tabling treaties, to share the objectives of the agreements with our parliamentary colleagues. We will do that. We will respect that.

There certainly will be an opportunity to listen to Canadians and we would agree.

[Rachel Bendayan, Liberal, Parliamentary Secretary to the Minister of Small Business]

Mr. Speaker, it is indeed with great pleasure that I too rise virtually in the House of Commons today in support of our proposed legislation to ratify the agreement on trade continuity between Canada and the United Kingdom. Just as we welcomed the recent signing of this important agreement, the government is also very pleased to take the next step toward ratification so Canadian exporters can take full advantage of the agreement's benefits.

As we know, Canada and the United Kingdom have historically enjoyed advantageous commercial relations, which we have built together over more than 150 years. Two-way merchandise trade between us amounted to $29 billion in 2019, making the U.K. Canada's fifth-largest trading partner after the United States, China, Mexico and Japan. In fact, Canadian exports to the U.K. have increased by over $2 billion since the Canada-EU Comprehensive Economic and Trade Agreement, or CETA, as it is commonly known, was provisionally applied in 2017.

Preserving this trading relationship means businesses will continue to have unprecedented access to the U.K.'s 66 million consumers and $3.68-trillion market. It also means lower prices and more choices for Canadian consumers and either a reduction or complete elimination of customs duties. Because this agreement is based on CETA, an agreement Canadians are already very familiar with, it provides the predictability and stability our businesses have told us they need as they grapple with the uncertainty brought on by this global pandemic.

The agreement on trade continuity brings with it significant, tangible benefits for Canadians. Once the agreement is fully implemented, it will carry forward CETA's tariff elimination on 90% of Canadian products exported to the United Kingdom. It will fully protect Canadian producers of all supply-managed products. It will maintain priority market access for Canadian service suppliers, including access to the U.K. government's procurement market, which is estimated to be worth approximately $118 billion annually. It will continue to balance investor protection with Canada's prerogative to regulate in the public interest, and it will uphold and preserve CETA's high standard provisions on labour and the protection of the environment.

This agreement will also continue to give Canadian companies a leg up on competitors in countries that do not have a free trade agreement with the U.K.

Indeed, Canadians welcomed the news of this agreement and the successful work of our negotiating team. I would like to expand on how critical our successful negotiation of this agreement is for the Canadian agri-food and agriculture industry.

Quebec is the home of the most dairy farmers in the country. It is followed by Ontario, Alberta and British Columbia. We know that farmers working hard right across this country wanted and needed the stability that this agreement provides. This is also the case for our beef producers. The first thought that comes to mind for me is the incredible beef exported out of Alberta and Ontario. I had the opportunity to engage directly with our beef producers and cattle feeders prior to the conclusion of the negotiations to hear their needs and interests and make sure that they were taken into account.

I would also like to give much credit to the Canadian Agri-Food Trade Alliance, or CAFTA. As Claire Citeau of CAFTA said during her testimony before the international trade committee:

This is an important first step to ensuring that exporters preserve the existing access and benefits that are already in place. The temporary certainty and stability that a transitional agreement provides is welcome news for some of our members and the reason we call on parliamentarians to work together to pass this agreement....

I am urging all members to listen to the call of our agriculture sector to swiftly ratify this agreement. We have some incredible associations representing the interests of our Canadian farmers and producers. They are engaged. They are well informed. They are targeted, and they are in constant contact with us, as they should be. Their engagement has been critical, and I certainly look forward to continuing to work with them in the next phase of the negotiation process toward a comprehensive bilateral trade agreement.

I want to emphasize what a success this agreement is for our dairy farmers. Not one additional ounce of foreign cheese will enter the country under this free trade agreement.

As Daniel Gobeil, president of the Producteurs laitiers du Québec, so aptly said, “The government has granted no additional access to the United Kingdom, in keeping with the commitment made by the Prime Minister and the Minister of Agriculture.... I therefore thank the government for keeping its commitment. This clearly shows that it is possible to enter into trade agreements without sacrificing supply management.

Canadian small and medium-sized businesses have also been very vocal. What they told us they needed most at this time, this turbulent time of crisis, is stability, stability in their trading relationships and stability in exporting their products, and this agreement fully delivers.

The agreement on trade continuity will enable many Canadian businesses that have come to depend on their U.K. clients avoid an unnecessary setback. Without this agreement, some Canadian businesses would come up against new obstacles and higher costs when doing business with the U.K.

Let me briefly paint a picture of what would have resulted if our government had not been as successful as it was, and if we had been unable to conclude a transitional trade agreement with the U.K. It is estimated over one billion dollars' worth of Canadian exports to the U.K. would have been subject to tariffs, and these tariffs would disproportionately affect our fish, seafood and agriculture exporters.

In addition to the tariffs placed on Canadian products being exported to the U.K., roughly 25% of all products imported from the U.K. would also be affected, with Canadian importers paying higher prices to bring in those goods, goods that our Canadian companies often need in order to operate, produce and grow.

Once ratified, the Canada-United Kingdom Trade Continuity Agreement will continue to be in place as we work toward a new bilateral comprehensive free trade agreement with the U.K. Indeed, this continuity agreement stipulates explicitly that within one year of ratification by both countries, the U.K. and Canada must come back to the negotiating table in order to conclude a comprehensive, longer-term trade agreement.

I know the minister and I look forward to leading a broad consultation process with Canadians from right across the country and in different sectors of our economy to ensure these future negotiations are directed in the best interests of Canada and respond to any post-Brexit developments.

With the time I have remaining, I would like to turn to some of the broader implications of our work as a government on international trade. Our Canadian government has been a leader among nations globally in advocating for free trade and stemming the tide of protectionist leanings. Indeed, we believe the contrary. Strong global trade partnerships, like our new agreement with the United Kingdom, are increasingly necessary and important, especially in these uncertain times, especially as other countries are looking to turn inward.

I am therefore asking all members from all parties to support Bill C-18's timely ratification and passage, and in so doing carefully consider not only the importance of this particular agreement for our Canadian farmers and producers, Canadian SMEs and all our exporters big and small, but also the message it sends to the world about the importance of keeping trade open and keeping Canada at the forefront of the advocacy on free trade. History will thank us for it.

[Mario Simard, Bloc, Jonquière, QC]

Mr. Speaker, I listened carefully to the parliamentary secretary. We know this is a transitional agreement and that U.K cheese producers will be looking for a bigger share of the market. It seems to me that this just puts the problem off until next year.

The Bloc Québécois proposed a solution: an exemption for supply management, which would settle this issue once and for all in trade agreement negotiations. If the past is any indication of the future, some questions are in order because supply management has always been a bargaining chip for both the Conservatives and the Liberals.

Does my colleague agree the best solution would probably be to have an exemption for supply management in trade agreement negotiations?

[Rachel Bendayan, Liberal, Outremont, QC]

Mr. Speaker, I thank my colleague for his question.

Personally, I think the Bloc Québécois and all Quebeckers should be celebrating what we have achieved with this transitional agreement. I am very pleased and proud to say that, by preserving supply management, we have protected our dairy producers.

As I said, we discussed this in committee, and I think our producers are happy with the transitional agreement we negotiated.

[Daniel Blaikie, NDP, Elmwood—Transcona, MB]

Mr. Speaker, in the last Parliament, one of the real questions around the timing of the government's adoption of CETA was that, at that time, the Brexit vote was pending. Certainly, New Democrats, and I believe I myself, got up in the House and questioned the wisdom of concluding a trade deal with Europe when our largest trading partner in Europe was about to leave the bloc.

We are now in a position of being asked to rubber stamp a carbon copy of CETA, which was, for all intents and purposes, designed for a European trading bloc. If and when a successor agreement is concluded, 40% of the trade Canada has done with Europe is going to be outside of CETA.

Does the government think this will have any consequences or ramifications for CETA? Is there anything that ought to have been different in CETA, given that the U.K. is no longer going to be part of that trading bloc?