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

[Rachel Bendayan, Liberal, Outremont, QC]

Mr. Speaker, I appreciate the question coming from my colleague, but, as I am sure he and all parliamentarians understand, when we negotiate a trade agreement with our global allies, we do so on the basis of the history and circumstances as they are at the time.

It was the right move for Canada to conclude CETA at that time. It allowed us to grow our economy. It allowed us to export to a greater degree to our allies in Europe. As I mentioned, since CETA was provisionally applied in 2017, we have increased our trade by $2 billion with the United Kingdom. I do think it was an important step and good move on Canada's part.

[Sean Fraser, Liberal, Parliamentary Secretary to the Minister of Finance and to the Minister of Middle Class Prosperity and Associate Minister of Finance]

Mr. Speaker, before I ask my question, I would like to thank my hon. colleague for her work to help develop some of the economic measures in response to the COVID-19 emergency.

One of the faults that folks like us who are involved in politics fall into is that we often discuss trade in a way that does not resonate with people who live in our communities. When we talk about GDP growth or export volumes, that is often a step removed from the people who are benefiting from these trade agreements and may not even realize it.

The parliamentary secretary mentioned in her remarks the impact on seafood tariffs. In my community, this will ensure we get a higher price for our seafood products, which will encourage young people to join the industry and continue to work in rural communities.

Could the member give examples of how the trade agreements will lead to having people be better off in her community here in Canada?

[Rachel Bendayan, Liberal, Outremont, QC]

Mr. Speaker, I would like to thank my colleague for all of his work on the economic measures and the response to COVID-19.

Certainly, one of the big successes of this continuity agreement is for our seafood producers, our exporters of lobster and seafood, who will benefit greatly. I am very pleased about that.

In my community, I have many innovative tech companies, and I know they are looking to new markets. They were very pleased by the ratification of CUSMA and are looking to export into the United States for the first time now. With this agreement, they will be exporting into the United Kingdom as well. This is of benefit to many different sectors of the economy, from tech and innovation, to manufacturers and agriculture and seafood exporters.

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, I ask for unanimous consent to split my time.

[The Deputy Speaker, Bruce Stanton]

As is customary now in this hybrid sitting of the House, we will only seek to see if there are any members present or participating who do not wish to grant unanimous consent to the hon. member to share her time. That being the case, I ask all those opposed to her sharing her time to please say no.

Seeing and hearing no opposition, it is so ordered.

The hon. member for Kelowna—Lake Country.

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, I will be splitting my time with the hon. member for Abbotsford.

I rise today to speak on Bill C-18, which seeks to implement the Canada and United Kingdom trade continuity agreement.

The United Kingdom is Canada’s third-largest export market, our fifth-largest trading partner and our oldest ally, with which we have $29 billion worth of bilateral trade annually.

Businesses want stability right now. I look forward to hearing debate on the bill and to seeing it come to committee so there are no delays for businesses.

How did we get here today, debating this bill after the deadline, when its ratification should have coincided with the United Kingdom no longer being part of the CETA and the European Union?

Unfortunately, the failure of the Prime Minister and his minister to take trade negotiations with the United Kingdom seriously now means that instead of securing a modern trade deal that is even better for Canadian businesses and workers, we are left with an agreement that has few amendments from the previous one with respect to addressing emerging trade issues, has no end date and has no clear dispute resolution process.

The United Kingdom voted to leave the European Union on June 23, 2016, four and half years ago. The government should have reasonably expected that a new trade agreement would need to be negotiated.

Through international trade committee testimony, we learned that negotiations had begun at some point during that time. However, we also learned that in March of 2019, the Minister of International Trade signed off on a decision to leave those negotiations.

I remember being in the House on Friday, March 13, 2020, when Parliament recessed due to the COVID-19 pandemic. As one would expect, the focus of this House and of all parliamentarians had to change on a dime. Now the entire focus was on health, the economic crisis and emergency legislation.

As the months progressed, there was still other work to do, and important deadlines were looming. After all, the clock was ticking toward the moment when the U.K. would no longer be part of the CETA, and a Canada-U.K. deal needed to be struck.

In May 2020, when we all met as part of the COVID-19 committee, members of the Conservative official opposition started to question the Minister of International Trade on the status of the trade agreement. Let us remember that this was not Parliament but a committee with no power that was asking questions.

In the May 21 sitting of the COVID committee, my hon. colleague, the member for Abbotsford, questioned the minister on what steps had been taken to engage with the U.K. on a free trade agreement. The minister replied, “...we will continue to work with the U.K. to secure our strong and stable trading relationship”. This relationship was so strong and so stable that with only seven months left to secure an agreement, Canada had still not returned to the negotiating table and was not working with the U.K.

At the COVID committee held on May 27, my colleague, the member for Prince Albert, asked the minister if the government would “commit to having a new trade agreement with the U.K. in place by January 1” of 2021. The minister's response was that they were “monitoring the situation very carefully.” She went on to say, ”They are in discussions right now”, when in fact we were not back at the negotiating table yet.

At the COVID committee meeting held on June 2, my hon. colleague from Regina—Wascana questioned the Minister of International Trade by asking, “The United States, Australia, New Zealand and Japan have all started free trade negotiations with the United Kingdom. Why hasn’t Canada?” The minister responded that “...we will always act in the interests of Canadian businesses” and that “we will make sure that our further work will always take into account the interests of Canadian businesses.”

With just mere months remaining before the U.K. would no longer be part of CETA, affecting $29 billion in bilateral trade, we were still not at the table. Where was the sense of urgency to act in the best interests of Canadian businesses?

The official opposition had been calling for the resumption of all parliamentary committees starting in May 2020. However, this did not occur. The international trade committee could have been doing important work, such as studies and consultations, just as other committees were doing all spring and summer, safely, productively and virtually. However, from March until September, the international trade committee only met once.

The government finally returned to the negotiating table in August 2020, leaving only five months to negotiate a deal, write the text of the legislation, bring it to Parliament for its processes and debate, send it to committee for study and witnesses' opinions, and then go through the Senate processes.

We finally returned to Parliament in late September, after the prorogation of Parliament. This political manoeuvre set all timelines back.

My first question in the House of Commons after prorogation was for the Minister of International Trade on her government’s promise to notify the House within 90 days of negotiations starting on trade agreements, a notification her government promised to provide to win the support of the NDP during the ratification of CUSMA, the new NAFTA. Her response left us with more questions than answers.

The Prime Minister then made patronizing comments about the United Kingdom's government by saying the United Kingdom lacked “the bandwidth” to negotiate a trade agreement and put blame for delays on the United Kingdom. This claim was strongly rejected by the United Kingdom government and its Secretary of State for International Trade. Further to this, one U.K. trade minister stated that the Prime Minister's claims should be taken with a pinch of salt.

These comments made by the Prime Minister about the United Kingdom, one of our oldest and most steadfast allies, certainly could not have been helpful during live negotiations on a trade deal of such importance to our country. After all, the United Kingdom had been able to negotiate secure and signed agreements with dozens of countries already. How is this taking into account the interests of Canadian businesses?

Stakeholders from across many business and labour sectors testified at the international trade committee that the government did not consult with them prior to withdrawing from negotiations to see how this decision might affect them, nor was there a formal or robust outreach process during negotiations. What a lost opportunity.

Conservative Party representatives expressed concerns about the lack of formal consultations as a whole for this trade agreement. I have heard from industries that were looking forward to an updated CETA, including major economic drivers in our country like the cattle industry, which wanted a U.K.-1 trade deal, not a CETA 2.0.

While officials have stated that the agreement ensures that Canada and the United Kingdom will get back to the negotiating table within a year, there are no penalties in the agreement if one side decides not to. The lack of an effective sunset clause makes this transitional agreement no different, really, from a comprehensive or permanent one. Wide-ranging consultations on the original CETA occurred about seven years ago. Situations and challenges evolve with time, especially in this fast-paced world that we now live in with emerging economies.

The government's failure to address concerns raised by stakeholder groups, especially by the agriculture and agri-food industry, such as non-tariff barriers, will unfortunately continue. Those are very concerning, and there is no clear dispute resolution process in the agreement. Supply-managed sectors were happy to hear that there were no concessions made for their industries, and industries overall just want stability, although they would have preferred that trade issues had been addressed.

Canadians expect the government to secure good trade agreements for our exporters, agreements that spur job growth for workers and grow our economy. Many businesses and families are searching for stability, and we need to do whatever we can to ensure that all sectors in our communities can survive and thrive going forward.

A trade deal was first announced with a splashy announcement on November 23. I had a call with the minister shortly afterward, in which I highlighted the importance of the Canada-U.K. trade agreement and the importance of ensuring that Canadians were not left worse off than they were under CETA. We wanted something even better. Canadian businesses needed clarity on the requirements resulting from the new agreement.

One thing that has been clear through this process is the mismanagement and undisciplined management of this file. Only when pressed up against time, at the 11th hour, do we come to a place where resolutions happen. British trade officials were more forthcoming on this 11th hour aspect. They expressed concerns and actually said that if we failed to ratify by the end of the year, this failure might create damage and disruption for businesses. However, we are pleased that a memorandum of understanding came on December 23 and arrived in time to prevent tariffs.

Over the past year, we have been relentless as Conservatives in our pursuit to shed light on what has been transpiring on this file. Really, this was left to the final week of the final month of the final year, and it will be critically important for the Minister of International Trade to work closely with her U.K. counterpart to begin formal negotiations on a truly new and comprehensive free trade agreement. We need agreements that involve and protect Canadian businesses and address non-tariff barriers and other emerging issues, have a clear and functioning dispute resolution system based on accountability, and are even better for our exporters in Canada.

[Mark Gerretsen, Liberal, Kingston and the Islands, ON]

Mr. Speaker, it feels like déjà vu in here. It is as though we are talking about the last trade agreement, since it appears that Conservatives are going to just criticize the agreement for the entire time and then eventually vote in favour of it. This agreement and having trade relationships are one of the tools that are going to allow our country to rebound out of the conditions that the pandemic has created for us when we are looking for opportunities to grow our country. Very simply, will the member be supporting this agreement?

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, it is like déjà vu, because here we have a trade agreement that has come in at the 11th hour with rushed legislation, and then the government is blaming it on other people for it being at the 11th hour. I do agree with the hon. member opposite on that point.

As I mentioned early on in my address, businesses need stability. We want this bill to go to committee and we want resolution so that Canadian businesses do not have to pay tariffs. It is obvious that this is what industries want, and we will be moving this measure forward.

[Simon-Pierre Savard-Tremblay, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, I commend and thank my colleague from the Standing Committee on International Trade for her presentation and for outlining the government's many failures on this file.

I am wondering whether the agreement on trade continuity between Canada and the United Kingdom is a carbon copy of the Comprehensive Economic and Trade Agreement with the European Union.

The provinces, and particularly Quebec, were at the negotiating table for CETA.

Do the Conservatives agree that that formula should be followed again, that it should be regulated so that Quebec is always invited to represent itself in trade negotiations?

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, when we are looking at trade negotiations, it is important that we have many voices at the table. That was one part that was definitely lacking in this process.

We had heard that there was not a formal consultation process. There was very limited outreach to a couple of industries, but on the whole, looking at all of the exporters, there really was no outreach. We heard testimony at the committee from major stakeholder industries representing thousands of companies that there was no consultation with them.

We look forward to the new consultation process that will be undertaken.

[Heather McPherson, NDP, Edmonton Strathcona, AB]

Mr. Speaker, one of the things that we heard from the minister earlier today was that this is a temporary, transitional deal, and that she looks forward to getting back to the table and working for a more permanent deal.

Given that it is being touted as a temporary and transitional deal, does the member have concerns about the fact that there is no sunset clause to ensure that negotiations lead to a successor agreement?

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, we have identified that it is not a transitional agreement because there is no end date and there is no sunset clause.

In fact, it is an agreement until a new agreement is signed. There are some parameters and some timelines in there to get back to the table, but there are really no ties to it. There are no ramifications if one side does not want to participate. This is the agreement until a new agreement is signed. There are no specific deadlines in it other than wanting to get back to the table.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Mr. Speaker, I appreciated the member's summary of the timeline. The question on everybody's mind right is, how long is it going to be before the vaccinations roll out?

Given the delay in negotiating this agreement and the fact that the U.K. has at least one vaccine that it will be producing, does the member think the delay in negotiating this agreement was a matter of the Prime Minister just enjoying and trying whatever he could to keep Canadians locked down, or was he just so wrapped up in corruption with the WE scandal that there was no time to pay attention to this important issue?

[Tracy Gray, Conservative, Kelowna—Lake Country, BC]

Mr. Speaker, when we look at the timeline, we do have to remember that the government had pulled out of negotiations in March 2019, even previous to the pandemic.

We were away from the table for a year before the pandemic came upon us. Here the issue is that other countries were signing agreements and were at the table negotiating, and we were not there. As I mentioned, we did not get back to the table until August, and then the government prorogued Parliament, which set everything back again.

Here we have a government that really was not focusing on this issue, and now we are in a situation with a memorandum of understanding, which is good because it is giving certainty to businesses, but this also has a deadline of the end of March.

[Ed Fast, Conservative, Abbotsford, BC]

Mr. Speaker, it is a pleasure to engage in another trade debate. As members know, trade is very close to my heart.

The United Kingdom and Canada have a long and common shared history. We have common values, we are trusted allies and we also have a long history of doing business with each other. In fact, today, the U.K. is Canada's fifth-largest trade partner and that drives prosperity and economic growth in our country and in the U.K. However, to be fair, our exports to the U.K. are primarily minerals, chiefly gold, while imports from the U.K. are comprised mainly of high-end manufactured goods.

The challenge for Canada is to increase the value of the goods we ship abroad, especially to the U.K. Our trade surplus with the U.K. is somewhere around $10 billion, but I would not crow too much about that. There is this imbalance between high-end manufactured goods and minerals, such as gold, that we ship to the U.K.

It would also be a mistake not to mention our services trade, which is very significant. A lot of Canadians do not understand that when we are talking about services trade, we are talking about things like engineering, some of the highest-paid jobs in Canada. When we do business with another country, when we sell engineering services to a place like the U.K., this is about Canada exporting high-value services and driving the growth of the economy in Canada.

Suffice it to say that trade is a key driver of economic growth and long-term prosperity in Canada, and the U.K., as one of our largest trade partners, is a country we have to engage with when it comes formalizing our trade relationship.

What is the challenge as we move forward?

We have always traded with each other, but for decades the U.K. negotiated trade agreements only as a part of the European Union, and much of its former negotiating expertise and power was ceded and vested in the EU's government in Brussels.

In 2009, former prime minister Stephen Harper had the foresight and vision to begin negotiations on a free trade agreement between Canada and the EU. This would take trade between Canada and the EU to a whole new level. I had the honour of leading that effort on behalf of Canada for some four and a half years.

On September 26, 2014, I joined European Commission President Barroso, European Council President Van Rompuy and Prime Minister Harper in Brussels to announce the end of those CETA negotiations, the trade agreement between Canada and the European Union.

One point of note is that our Liberal friends like to claim credit for all the trade successes of the previous Harper government. In the military, they call it stolen valour, something about which the Liberals know a little. They love to take credit for things that rightly were accomplished by others.

Let me be very clear that the CETA agreement with the then 27 countries of the EU was the brainchild of Stephen Harper. It was under his government that negotiations were commenced and substantively completed. Over the last few years, that CETA agreement has governed our relationship not only with the EU but with the U.K. As my colleague just mentioned, our trade with the U.K. is up by about $2 billion a year, again, driving economic growth in Canada.

The CETA agreement that Stephen Harper negotiated was arguably the most comprehensive, progressive and forward-looking 21st century trade agreement in the world. It liberalizes trade through broad tariff elimination. It promotes and protects investments. It opens up government procurement and includes rigorous intellectual property protections, dispute resolution and disciplines on sanitary and phytosanitary standards. It protects culture and our cultural industries. It contains some of the strongest commitments ever included in a free trade agreement to promote labour rights, environmental protections and sustainable development. We had expected that agreement to govern our commercial relationship with the European Union for decades to come, including our relationship with the U.K. Then Brexit happened.

Without trying to divine the exact reasons for the U.K. deciding to leave the EU, the British people freely voted to leave the EU and regain their sovereignty over policy-making, and that included trade policy. In the short term, that meant the U.K. was left with no trade agreements with any of its closest trade partners, including Canada, and the British government had to scramble to find the people necessary to competently negotiate trade agreements. Its top priority was securing a new trade agreement with the European Union to assure its most favoured relationship with Europe. Then there was Canada, with which the U.K. no longer had a trade deal since the U.K. was no longer part of the CETA agreement.

Therefore, what was the fix going forward? The solution was to replace CETA with a bilateral trade agreement, Canada and the U.K., which would preserve its trade with Canada without either side incurring economic harm.

That brings us to the debate we are having today, the Canada-UK Trade Continuity Agreement. As its name implies, it is more about preserving and carrying over our CETA benefits and obligations than carving out new territory on trade liberalization. It was unfortunate that the Liberal government and its trade ministers inexplicably chose to delay these negotiations and refused to engage with the U.K. for over a year. That, in turn, meant there was a last-minute rush by the government to rush through the legislation before the new year. When that did not pan out, the Prime Minister, sadly, turned to blame shifting, as my colleague from Kelowna—Lake Country mentioned. The Prime Minister claimed that the delays in finalizing this deal were because the U.K. did not have the bandwidth to negotiate.

The agreement was finally concluded, with really no substantive changes to the rights that each of our countries have under CETA.

What does this mean?

Someone recently referred to this new agreement with the U.K. as a “nothing burger”, suggesting that because there was nothing new in this agreement, there was little of value to praise. Although it is true that not much new policy ground was plowed, this trade agreement means absolutely everything when it comes to protecting our preferred bilateral relationship with the U.K.

The alternative would have been to leave us with no trade agreement at all, only with a much less advantageous benefits of the floundering World Trade Organization. Essentially, we would be returning to the wild, wild west of trade, and that is certainly not what either party wanted.

With this Canada-UK Trade Continuity Agreement presently before us, we are left with a status quo agreement that preserves our current trade and investment relationship under a clear set of liberalizing rules, and that is good news for the residents of Canada.

What does the future look like beyond this continuity agreement we are debating here today? Both parties have committed to pursuing an even more ambitious trade and investment agreement in the future. That negotiation would reflect the unique characteristics of the Canada-U.K. relationship, including our similar economies and social structures, our common approaches to foreign policy, security and defence and our common shared approach to freer and fairer trade around the world.

We have three options to further our relationship with the U.K. The first is to take this agreement further by negotiating a more ambitious bilateral trade agreement with the U.K., using these unique characteristics to further eliminate trade barriers and expand investment opportunities. This might perhaps include greater regulatory alignment and broader mutual recognition of credentials.

However, what a lot of people do not realize is that Canada is part of the CPTPP and the U.K. has applied, or is in the processing of applying, to join the CPTPP. The U.K. has signalled its intention to join CPTPP because it knows that in the CPTPP it would make common cause with Canada and the other TPP partners in the Asia-Pacific region as a counterweight to China's belligerence and hostility in the region.

The COVID pandemic and China's increasing belligerence on the world stage make it highly advisable for like-minded nations to make common cause to counteract China's efforts to control and manipulate our system of global rules-based trade, and CPTPP is the perfect vehicle for doing so.