Bill C-282

An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management)

This enactment amends the Department of Foreign Affairs, Trade and Development Act so that the Minister of Foreign Affairs cannot make certain commitments with respect to international trade regarding certain goods.

[Dan Darling, President, Canadian Agri-Food Trade Alliance]

Thank you, Mr. Chair.

Members of the committee, thank you for the opportunity to present to you today. My name is Dan Darling, and I am the president of the Canadian Agri-Food Trade Alliance. I'm also a beef producer and grain farmer here in Ontario.

CAFTA is the voice of Canadian agri-food exporters, advocating for a more open and fair international trading environment for agriculture and agri-food. Today, I am here to convey to parliamentarians in the strongest terms possible that Bill C-282 should not be supported, given its negative consequences for the Canadian economy and our hard-won reputation as one of the great trading nations of the world.

This position is grounded in decades of Canada's experience in leading the way in negotiating various trade agreements whether multilaterally, regionally or bilaterally. We represent 90% of farmers who depend on trade as well as producers, food processors and agri-food exporters who want to grow the economy through better access to foreign markets.

Our members include producers of beef, pork, grain, cereals, oilseeds, pulses, soybeans and canola as well as the sugar and processed-food industries. Collectively we account for over 90% of Canada's agri-food exports and support about one million jobs in urban and rural communities across Canada. A significant portion of these sales and jobs would not exist without competitive access to the world market.

Free and open trade is essential to our prosperity. Canada is a trade-dependent country. International trade accounts for nearly two-thirds of our national economy and supports more than one out of every six jobs.

Bill C-282 threatens Canada's ability to secure and negotiate the best trade agreements to support our long-term economic success. The committee has been told that Bill C-282 will not affect Canada's major trade deals because they are essentially all complete. Nothing could be further from the truth. We are negotiating a massive deal with the United Kingdom, our largest trading partner in Europe right now. Agricultural negotiations at the WTO remain ongoing, and provisions to CUSMA state explicitly that it can be reopened and renegotiated at a moment's notice.

My point is that this is no time to be making it more difficult for our negotiators to do their jobs. Flexibility and balance are key components to successful trade negotiations, and this bill takes away these critical ingredients.

Canada has successfully concluded many of its most beneficial and meaningful trade negotiations, including CETA, CPTPP and CUSMA, through compromise and flexibility. Simply put, these trade negotiations would not have happened if Canada was not prepared to discuss everything at the table with a broader national economic interest in mind. This legislation weakens our negotiation position from the outset and increases the leverage of other trading nations against Canada by making it impossible for partners to even contemplate a win, big or small, in these sectors.

Bill C-282 reduces our opportunity to participate and gain market access in various bilateral and multilateral negotiations. Ultimately, this bill will put us on a collision course with the United States and other major trading partners, especially when it's time to renew, extend or modernize existing trade agreements. Trade disruptions would be catastrophic for Canada. The food manufacturing sector is bigger than the automotive and aerospace sectors combined.

Further Bill C-282 sets a new dangerous precedent, inviting our trading partners to adopt similar legislation and closing market opportunities for everyone involved. Canada has worked tirelessly to promote open and rules-based trade for agri-food and bilateral discussions, as well as through the Ottawa Group and international organizations such as the G7, G20, the WTO and the forum for Asia-Pacific Economic Cooperation. This legislation directly contradicts Canada's leadership at international fora like the WTO, where Canada opposes protectionism and supports rules-based trade systems.

A key part of Canada's economic growth will be trade diversification into other regions of the world where we don't have major trade agreements, such the Indo-Pacific and Africa. While the government's Indo-Pacific strategy is a step forward in trade diversification, Bill C-282 is a step backwards.

To summarize, Bill C-282 threatens existing and future trade deals, erodes stability and predictability in trade, and jeopardizes the very foundation of Canada's economic growth: free and open trade.

Make no mistake. Agriculture will not be the only industry affected by this bill. Key sectors such as energy, manufacturing—

[Daniel Turp, Emeritus Professor, Université de Montréal, As an Individual]

Thank you, Mr. Chair.

Greetings to your fellow parliamentarians and to the clerk of the Standing Committee on International Trade.

I would like to express my pleasure at being back in the House of Commons, virtually. Like you, I have had the privilege of sitting in the House of Commons, as I was the member for Beauharnois-Salaberry during the 36th Parliament, from 1997 to 2000. Today, I am responding to your invitation to appear before you to present my comments on Bill C‑282.

It is a very simple bill. As you've seen, there's a section that would add subsection 2.1 to section 10 of the Department of Foreign Affairs, Trade and Development Act. This subsection would essentially ensure that the Minister of Foreign Affairs could no longer engage in negotiations on Canada's supply management system or challenge it through negotiations.

I will make three points. A few hours ago, I submitted a written document to the clerk of the committee. I hope that you will be able to read this document.

My first comment concerns the advisability of improving the act by passing Bill C‑282. In this regard, you will note that I have mentioned in my paper and in my notes the existence of a broad consensus on the need to protect supply management. This consensus is reflected in unanimous House of Commons motions, including the one of November 22, 2005, which was adopted almost 20 years ago in the context of negotiations at the World Trade Organization. In 2018, there were similar motions in the Trans-Pacific Partnership negotiations.

There are also statements from the Minister of Agriculture and Prime Minister Justin Trudeau, who reminded us that Canada's supply-managed sectors are pillars of rural areas. He added that his government had made a public commitment not to make further concessions in future trade agreements. The Conservatives, through their current leader, have also said that they support supply management. The New Democratic Party also did so in the discussions surrounding Bill C‑216, which preceded Bill C‑282, but was the same in content. The only party that is opposed to protecting the supply management system is the People's Party of Canada, and it has no members in the House of Commons.

So I say, very humbly, that there is a very broad consensus on this issue. Given that broad consensus, I believe that Bill C‑282 should pass and that Parliament should tell the government that it can no longer question the supply management system during negotiations.

This would also send a clear message to trading partners that they can no longer expect the government to make concessions on this system, and it would protect a number of farmers who are calling for the protection of this system and its continuation.

With respect to the legality of the bill, as I mentioned in my written notes, I agree with my colleague from Laval University, Patrick Taillon, who presented his views to this committee when Bill C‑216 was reviewed. I understand that you have a brief from him in which he comments on this issue. He says very clearly that this amendment to the act would be legal and would not pose a constitutional problem. In effect, a law could change the royal prerogative and limit the powers of the Minister of Foreign Affairs when negotiating international trade treaties that could allow concessions where there should not be any.

I will close, Mr. Chair, by suggesting that Parliament should play a much greater role when it comes to international treaties.

It should be given the ability to limit the powers of the minister, as the member who introduced this bill would like. Parliament should be able to approve international trade treaties, because they are important.

[The Vice-Chair, Conservative, Kyle Seeback]

I call this meeting to order.

Welcome to meeting number 52 of the Standing Committee on International Trade.

Today’s meeting is taking place in a hybrid format, pursuant to the House Order of June 23, 2022. Therefore, members are attending in person in the room and remotely using the Zoom application. I'd like to make a few comments for the benefit of the witnesses and members.

Please wait until I recognize you by name before speaking. When speaking, please speak slowly and clearly. If you are participating by video conference, click on the microphone icon to activate your mike, and please mute yourself when you are not speaking. With regard to interpretation, those on Zoom have the choice at the bottom of their screen of “floor”, “English” or “French”. Those in the room can use the earpiece and select the desired channel.

I remind you that all comments should be addressed through the chair. Members in the room who wish to speak can raise their hand. Members on Zoom can use the “raise hand” function. The clerk and I will manage the speaking order as best we can, and we appreciate your patience and understanding in this regard.

Please also note that, during the meeting, it is not permitted to take pictures in the room or screenshots on Zoom.

In accordance with the committee’s routine motion concerning technical tests for witnesses, I am informing the committee that all witnesses have completed the required tests.

Pursuant to the order of reference of Wednesday, February 8, 2023, the committee is resuming its study of Bill C-282, an act to amend the Department of Foreign Affairs, Trade and Development Act, regarding supply management.

We have a number of witnesses with us today: Daniel Turp, emeritus professor, Université de Montréal, as an individual; Dan Darling, president, and Greg Northey, vice-president, Canadian Agri-Food Trade Alliance; Nathan Phinney, president, and Dennis Laycraft, executive vice-president, Canadian Cattle Association; Pierre Lampron, president, and David Wiens, vice-president, Dairy Farmers of Canada; Daniel Gobeil, president, Les Producteurs de lait du Québec, by video conference; and Jan Slomp, National Farmers Union, by video conference.

Welcome, all. We're going to start with opening remarks, and then proceed with the first round of questions.

Mr. Turp, I invite you to make an opening statement of up to five minutes.

That will be followed by Mr. Darling, Mr. Phinney, Mr. Lampron, Mr. Wiens, Mr. Gobeil and Mr. Slomp, all for five minutes. If you can't keep track of that, I'm happy to reorient you as to who is speaking next.

Mr. Turp, I invite you to go forward.

[The Chair, Liberal, Judy Sgro]

Thank you very much to our witnesses. It was a fascinating afternoon, as a few other points were also raised. Thank you, and until the next time.

A witness list for Bill C-282 must be submitted by Tuesday, February 21 if you have any additional witnesses. On March 6, we're going to deal with draft reports on the ArriveCAN study and the Inflation Reduction Act. Please ensure any further witnesses for Bill C-282 are submitted.

Thank you all very much. The meeting is adjourned.

[Aaron Fowler]

No, it is not our belief that it would. The access to the Canadian market that has been provided to Ukraine is a unilateral action taken by the Government of Canada. It is not a treaty obligation, therefore I do not believe it would be covered by Bill C-282.

[Tony Baldinelli, Conservative, Niagara Falls, ON]

Would Bill C-282 have prevented the government from including supply management in the Ukraine goods remission order?

[Aaron Fowler]

I believe Bill C-282 would render into law what has been government policy for some time. It would remove any question as to whether Canadian negotiators have flexibility beyond what they're expressing at the table.

Whether that will make it easier for Canadian negotiators to conclude FTAs in the future is a different question, and I choose not to speculate on that at this time.

[Yves Perron, Bloc, Berthier—Maskinongé, QC]

Thank you very much.

Do you think the passage of Bill C‑282 would strengthen Canada's position in future negotiations in order to avoid new breaches in supply management?

[Chandra Arya, Liberal, Nepean, ON]

There will be a negative impact.

The Canadian Agri-Food Trade Alliance, which represents 90% of Canadian farmers, producers, food manufacturers and agri-food businesses that depend on trade, says it strongly oppose Bill C-282. It stated, “This legislation creates a dangerous precedent and diminishes Canada as a free trade partner.”

Do you agree with this statement?

[Colin Carrie, Conservative, Oshawa, ON]

Okay. Right now, I think everybody is aware that we have a bit of a dispute with the United States. I think it was on December 20, 2021, that a dispute settlement panel determined that Canada contravened CUSMA's obligations but we could retain the supply management system.

On January 31, 2023, a week ago, the United States again requested establishment of a dispute settlement panel relating to Canada's dairy policies. I was wondering, if we enacted this bill, Bill C-282, would it affect the Canada-U.S. trade relationship concerning dairy products? If so, how? What is the probability that, following enactment, the United States would seek to renegotiate certain CUSMA provisions? What are your thoughts on that?

[Tom Rosser, Assistant Deputy Minister, Market and Industry Services Branch, Department of Agriculture and Agri-Food]

Thank you, Madam Chair.

Honourable members, I appreciate the opportunity to appear before the Standing Committee on International Trade on its review of Bill C‑282.

Agriculture and Agri-Food Canada, AAFC for short, works closely with and supports Global Affairs Canada in advancing Canada’s free trade agenda, playing an important role in trade negotiations, particularly in areas related to market access for agricultural goods.

As said by my counterpart Mr. Fowler, the Government of Canada has had a long-standing policy to defend the integrity of Canada’s supply management system for dairy products, poultry and eggs. This includes clear commitments made by the Prime Minister and the Minister of Agriculture and Agri-Food to not provide any new market access for supply-managed products in future trade agreements. The bill is consistent with this policy.

Canada’s supply-managed dairy, poultry and egg farmers are part of the backbone of rural communities across the country, generating almost $13 billion in farm-gate sales in 2021, and creating over 100,000 direct jobs in production and processing activities across Canada.

With respect to the market access provided to Canada’s trade partners, it has only been provided in exceptional cases in regard to landmark trade agreements, such as the Agreement Establishing the World Trade Organization, or WTO, CETA, the CPTPP and CUSMA. While not taken lightly, these trade agreements are overwhelmingly in the interest of Canada and to the overall benefit of Canada’s agricultural sector.

Furthermore, in the case of CUSMA it's important to remember that the original negotiating position in the United States was the full elimination of the supply management system. The outcome in CUSMA, while difficult and challenging, allows the supply management system to continue functioning with respect to its three pillars.

The Government of Canada is also fully and fairly compensating producers and processors with supply-managed commodities who have lost market share under the three agreements. As announced this past November, dairy, poultry and egg producers and processors are expected to share more than $1.7 billion in direct payments and investment programs in response to the impacts related to CUSMA. This is in addition to the over $3 billion in direct payments in investment programs for CETA and CPTPP. These programs will help drive innovation and growth in the supply-managed sectors.

In conclusion, the integrity of the supply management system has been successfully defended during multiple trade negotiations. The Government of Canada is working hard to ensure that the supply management system remains strong and that producers and processors operating in the system remain productive and sustainable.

Bill C-282 would protect these sectors from additional market access concessions in the context of future trade negotiations, and as such is fully consistent with existing policy.

Thank you again, Madam Chair. Along with my colleagues, of course, I'd be happy to answer any questions that committee members may have.

[Aaron Fowler, Associate Assistant Deputy Minister, Department of Foreign Affairs, Trade and Development]

Madam Chair and honourable members, thank you for the invitation to appear before the Standing Committee on International Trade on its review of Bill C-282.

The bill proposes to amend the Department of Foreign Affairs, Trade and Development Act, such that the Government of Canada cannot make any commitment in an international trade treaty that would have the effect of increasing tariff rate quota volumes or reducing over-quota tariff rates for dairy products, poultry or eggs.

The intent of the bill is consistent with the long-standing Government of Canada policy to defend the integrity of Canada’s supply management system. In practice, this policy has allowed Canada to successfully conclude 15 ambitious free trade agreements covering 51 countries while preserving Canada’s supply management system, including its three pillars of production control, pricing mechanisms and import controls.

New market access for supply-managed products has been provided only at the WTO and in three free trade agreements, which are the Canada-European Union Comprehensive Economic and Trade Agreement, or CETA; the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, or CPTPP; and the Canada-United States-Mexico Agreement, or CUSMA.

The decision to provide increased market access for supply-managed goods in the context of these negotiations was not taken lightly. Such commitments were accepted only where it was deemed necessary to conclude free trade agreements that were in Canada’s overall economic interests. For instance, these agreements allowed Canada to maintain its preferential access to the United States market and to secure significant new access to the EU, Japan and other important foreign markets. It is important to highlight that while new access for supply-managed products was provided through these agreements, the integrity of the supply management system itself, including its three pillars, was fully maintained.

In recent years, the government has made clear its commitment to make no further market access concessions for supply-managed products in future trade negotiations. In line with this publicly stated commitment, Canada’s most recently concluded trade agreement, the Canada-United Kingdom Trade Continuity Agreement, did not provide new market access for cheese or any other supply-managed product, even though this was an important issue for the United Kingdom in the negotiations.

In conclusion, Bill C-282 proposes to make the government’s commitment to make no further market access commitments for supply-managed products into a legal requirement by amending the Department of Foreign Affairs, Trade and Development Act. This would strengthen the policy of defending the integrity of Canada’s supply management system by enshrining it into law.

Along with my colleagues here today, I welcome the committee's questions. Thank you.

[Luc Thériault, Bloc, Montcalm, QC]

Indeed, if we were to pass the bill fairly quickly, it could strengthen the position of our negotiators at the table. Given the fact that when the UK was in the EU they were given shares, I think they should be negotiating some of what was already conceded.

The quick passage of Bill C‑282 could give us an interesting lever. That's how it could be done.

Mr. Roche, would you like to add anything?

[Luc Thériault, Bloc, Montcalm, QC]

Absolutely.

I am introducing Bill C‑282 precisely because, in the past, our representatives, after mouthing allegiance to supply management with their hands on their hearts, decided to sacrifice it.

This time, we're asking you if you want to hold on to this system. We are going to do what every other country is doing, we are going to take it off the table. That's all.

[Chandra Arya, Liberal, Nepean, ON]

I apologize. The witness talks about people who are providing food. I am also talking about people who are providing food: Pulse Canada, the Canola Council of Canada, Grain Growers of Canada, the Canadian Pork Council and the Canadian Cattle Association. They are saying they're strongly opposed to Bill C-282. They not only provide food to Canadians; they provide food to people across the world, which is how they made Canada number five worldwide in terms of these exports. That is what I'm talking about.