Foreign Affairs Committee on Nov. 7th, 2017

[The Chair (Hon. Robert Nault (Kenora, Lib.)), Liberal, Bob Nault]

Colleagues, we are here pursuant to the order of reference of Tuesday, October 3, 2017, on Bill C-47, an act to amend the Export and Import Permits Act and the Criminal Code.

We have three witnesses this morning. We will allow them to make short presentations and then get into the usual Qs and As.

The witnesses are the Canadian Association of Defence and Security Industries, the Control Arms Secretariat, and the Canadians for Justice and Peace in the Middle East.

From New York, we have Anna Macdonald, the director of the Control Arms Secretariat.

I'm going to turn the floor over to you for your presentation.

[Anna Macdonald, Director, Control Arms Secretariat]

Thank you very much for this opportunity to address the Standing Committee on Foreign Affairs and International Development.

The Arms Trade Treaty is an amazing document. It took over 10 years of campaigning and six years of UN processes to come into being. It has the potential to bring the arms trade under control and prevent the devastation wrought every day through arms-fuelled poverty, conflict, and human rights abuses. Throughout the world, both the persistence of cyclical conflicts and high levels of armed violence are hampering development, increasing human rights abuses, and exacerbating poverty.

Before the ATT, there was no global treaty regulating the trade in conventional arms and little to prevent the high number of weapons that end up in the illicit market. The ATT therefore offers an important humanitarian tool for addressing the challenges posed by the poorly regulated flow of weapons to some of the world's least developed areas and to conflict zones.

I am the director of the Control Arms coalition, which brings together hundreds of non-governmental organizations from all regions of the world and from many different fields, including human rights, poverty alleviation, conflict reduction, weapons specialists, health, youth, gender, and survivor networks, parliamentary networks, and legal expertise.

Control Arms provides evidence-based research and analysis, conducts outreach to government supporters and the public, builds capacity and expertise among both governments and civil society, and facilitates policy dialogue. We have an emphasis on support and training in the global south and in monitoring of Arms Trade Treaty implementation.

Canada's absence from the ATT was a strange exception over the last few years, and we are greatly encouraged by the current government's commitment to accede to the treaty in the near future. This presents a tremendous opportunity for a return to the leadership in disarmament and peace issues for which Canada was once renowned, for example, through the leadership which led to the Ottawa convention and subsequent mine ban treaty signed in Ottawa in 1997.

The current process toward accession also presents a great opportunity to modernize Canadian export control legislation toward high standards in transparency and accountability and with a firm basis in international human rights and humanitarian law. We welcome some of the positive considerations in Bill C-47, such as the inclusion of brokering and the extension to extraterritorial controls on brokers. However, we share our Canadian partners' concerns on some of the flaws in the legislation, which I would encourage you to reconsider. The most important and relevant aspects of the ATT I would like to highlight in this regard are as follows.

First, there is the purpose of reducing human suffering. Central in the object and purpose of the ATT in article 1 is the purpose of reducing human suffering. This is the goal that must remain paramount in all efforts to universalize and implement the treaty. This is an instrument specifically designed to reduce the human suffering resulting from armed violence and armed conflict, not only in the direct deaths and injuries caused by weapons but also through trauma, displacement, economic impoverishment, torture, and oppression. Therefore, Canadian legislation must also be oriented toward this goal of reducing human suffering.

Second, there is the aim of the highest possible common standards, which article 1 also calls for, meaning that there should be no exemptions or exceptions. The continued exclusion of exports to the U.S., constituting as they do over 50% of Canadian arms exports, is a significant omission. Canada will be undermining common standards by excluding a major arms importer and exporter that's unlikely to become a states party in the near future. Article 2 additionally emphasizes that the treaty is applicable to all exports covered under the scope, and article 5 calls on states to implement ATT in a consistent, objective, and nondiscriminatory manner. To our knowledge, there is no other country that enables such a specific export destination to be exempted from its legislation in its ratification or accession to the ATT. To do so would be both unusual and undermining to the core principles of the treaty. The very nature of the ATT is that it is global, the first treaty to regulate the trade of conventional weapons, and therefore aims for universal adherence to high common standards.

Third is the importance of absolute prohibitions and risk assessment. The heart of the treaty is in articles 6 and 7, which cover prohibitions and risk assessments. These articles are very clear and unambiguous that a state “shall not” authorize an arms transfer where it has knowledge the arms will be used in war crimes, in violation of international agreements to which it is a party, or where a risk assessment results in overriding risk. Canadian proposed legislation, which will allow the foreign affairs minister to merely take into account such risks, sets a much lower threshold. In our view, this would mean Canada would not be in compliance with the ATT.

Additionally, I would like to encourage you to consider appropriate parliamentary structures that would enhance oversight and transparency. We have found around the world a strong correlation between active parliamentarians in both the speed of ratification and accession and effective treaty implementation. In the U.K., for example, the committee on arms export controls functions as an additional cross-party oversight mechanism, which holds ministers to account and hears evidence from expert stakeholders.

Finally, I would draw your attention to the inclusion in article 7 of specific language on “gender-based violence”, mandating the risks of gender-based violence to also be considered as part of the authorization assessment. This is the first treaty ever to include specific language on GBV and its operative provisions, and I encourage the Canadian government to explore all possible ways to ensure that this groundbreaking aspect of the treaty is implemented.

In conclusion, the two most important flaws in the proposed legislation, which I encourage you to reconsider, are, first, that Bill C-47 does not cover arms exports to the U.S. and that this therefore leaves a large percentage of exports that will be excluded from the treaty provisions, and, second, the lack of legal limits on the discretionary power available to the foreign affairs minister.

Control Arms supports the universalization and implementation of the ATT, and we believe that it can have a positive humanitarian and human rights impact. We urge you to seize this opportunity to reposition Canada once again as a leader in disarmament and peace-building and to demonstrate the highest possible standards in bringing the arms trade under control.

Thank you.

[The Chair, Liberal, Bob Nault]

Thank you very much, Ms. Macdonald.

Now we'll go to Ms. Cianfarani, who is representing the Canadian Association of Defence and Security Industries.

[Christyn Cianfarani, President and Chief Executive Officer, Canadian Association of Defence and Security Industries]

Ladies and gentlemen, honourable members, good morning and thank you for inviting me to speak to you today.

I'd like to take the next few minutes to give you the perspective of my industry, the Canadian defence and security industry, on the United Nations Arms Trade Treaty and the importance of raising the bar globally to a unifying standard and reducing weapons proliferation.

CADSI is the national voice of more than 800 Canadian defence and security companies that produce world-class goods, services, and technologies that are made across Canada and sought the world over. Our member companies contribute to the employment of more than 63,000 Canadians across the country, pay wages 60% higher than the average manufacturing wage, and generate $10 billion in annual revenues.

If you refer to the most recent “State of Canada's Defence Industry” report, which is from 2014, you'll notice that our industry's major segments pertaining to revenues include aircraft fabrication, structures, components, and maintenance, repair and overhaul at 31%; combat vehicles and related maintenance, repair and overhaul, and other related defence goods and services at 28%; command, control, communications, computers, intelligence, surveillance, and reconnaissance, or C4ISR, including avionics and simulation systems and other electronics at 25%; naval ship fabrication, structures, components, and maintenance, repair and overhaul at 9%; firearms, ammunition, missiles, rockets, and other munitions and weapons at 4%; troop support at 2%; and live personnel and combat training services at 1%.

Our members take pride in delivering defence and security goods, services, and technologies to the Canadian Armed Forces, Coast Guard, and security service providers to keep Canadians safe and secure on a daily basis. The most relevant number to this discussion, however, is that 60% of our sector's revenues come from exports. That means our members' innovative technologies, products, and services are sought out by governments across the globe. The fact that Canadian companies are highly competitive in highly regulated and protected foreign markets suggests our industry is both innovative and productive. In other words, ours is an industry that Canadians should value. We need to recognize that defence exports are essential to maintaining leading-edge industrial capabilities, a skilled and knowledgeable workforce, and an advanced technological base here at home.

Before discussing the UN ATT specifically, I'd like to point out that the existing Canadian export control regime, which our members adhere to on a daily basis, is highly robust and rigorous. The Canadian defence export regime consists of three separate approval processes and sets of regulations: the automatic firearms country control list, the controlled goods program, and the Export and Import Permits Act. It involves multiple federal government departments, including Global Affairs Canada, Public Services and Procurement Canada, National Defence, and Justice Canada. If you haven't had a chance to peruse the depth and breadth of these documents, I actually have them here with me today.

Canada's accession to the UN ATT will further enhance our very strong defence export regime and raise the bar globally for other countries whose defence export control processes are not up to Canada's very high standards. The treaty places additional burdens on countries that export small arms and military equipment, to ensure the weapons are not diverted to third parties or misused by the actual recipients. It will also regulate the practice of brokering, where weapons are exported from one third country to another. This is in part why CADSI called on the government last year to accede to the UN ATT.

In Canada the government sets tough parameters, rules, and regulations on defence exports, and our companies follow them. In terms of the new requirements on defence exports that arise out of Canada acceding to the UN ATT, we only ask that government continue to provide a predictable and timely framework within which businesses can operate. Industry needs a process that allows our companies to fairly pursue market opportunities with the confidence that they are supported by their government.

It's important that the government communicate as early and clearly as possible regarding its comfort with exporting a particular good to a particular country and end-user. Companies do not want to invest significant resources in pursuing potential sales opportunities if the government denies them the permit at the end of the process. The export licence is the final stage in the process, not the first.

In conclusion, CADSI fully supports Canada's acceding to the UN ATT. All of our allies are signatories to this treaty, and Canada should be as well. The Canadians who work for defence and security companies care and are concerned about the world in which they live, and are proud of what they do, make, and sell. They share the same basic values that we all share.

I'd like to thank the committee for providing our industry with an opportunity to appear before you today to share this message, and I welcome any questions you may have.

[The Chair, Liberal, Bob Nault]

Thank you very much.

I'll go now to Mr. Woodley, who's representing Canadians for Justice and Peace in the Middle East.

[Thomas Woodley, President, Canadians for Justice and Peace in the Middle East]

Good morning.

My name is Thomas Woodley. I'm the president of Canadians for Justice and Peace in the Middle East.

I first wish to thank the committee for this kind opportunity to speak to you this morning. It's a privilege, of course, to be here. I look forward to a frank and honest discussion about Canada and its role in the sad realities of the international arms trade today.

CJPME is an organization, my organization, whose mission is to empower Canadians of all backgrounds to promote justice, development, and peace in the Middle East. We have about a dozen activist groups across the country, and we have approximately 125,000 Canadians who have participated in our activities and campaigns over the years. Because of the devastating role that arms have played in the Middle East over the years, my organization has become increasingly involved in attempts to limit the flow of arms to the Middle East.

CJPME was thrilled when the international Arms Trade Treaty was first concretely debated in 2012, then adopted by the UN General Assembly in 2013, and entered into force in 2014. However, despite our excitement at the adoption of the ATT by much of the world community, we were saddened and upset by the Canadian government's reluctance to consider signing the treaty for many of the past several years.

It's important to note that at the same time the ATT was creating greater hope for higher standards and greater transparency in the movement of arms around the world, Canada was negotiating one of its largest arms deals ever with a serial human rights abuser, Saudi Arabia. This arms deal has been in and out of the news over the past two or three years, as you all know, I'm sure, with two successive governments providing shifting justifications for the sale, despite the fact that Saudi Arabia regularly ranks among the worst of the worst of human rights violators.

In fact, a survey of Canadians just two months ago, in September, by Nanos Research for the The Globe and Mail found that 64% of Canadians oppose or somewhat oppose the Canadian government's decision to sell light armoured vehicles to the Saudi government. Despite the fact that it's common sense, as demonstrated by the survey results, that this sale should not have been approved, Canada's existing export controls, as embodied in the Export and Import Permits Act, EIPA, failed to prevent the sale. There is clearly much to say about this sale, but it's obvious that for a strong majority of Canadians, the current EIPA provisions did not properly function to prevent this sale.

We had high hopes that the new government would sign on to the treaty in a way that would address the long-standing shortcomings of Canada's existing arms export controls. Nevertheless, when Bill C-47 was introduced, it was immediately clear that many of the fundamental objectives of the ATT were being circumvented through the provisions of the bill, whether through omissions, through exclusions, or through deferral to regulations, whether intentionally or unintentionally.

The committee has already heard from a number of witnesses, and I believe there are important points to make regarding some of the testimony that the committee has already heard. I'll address three points.

The first is the need for a legally binding obligation in Bill C-47 on the minister. A witness for the government admitted the following:

Article 7 of the ATT requires each state party to consider a number of specific risks with respect to the items proposed for export, before authorizing the export to take place...The critical element was the need to create a legally binding obligation for the minister to take the ATT assessment considerations into account in deciding whether to issue an export permit.

First, we must be clear that the ATT establishes strict prohibitions on arms exports, depending on an objective risk assessment, and that simply requiring taking considerations into account will not satisfy Canada's obligations under the treaty.

The same witness went on to suggest that the ATT requirement was “most effectively implemented through regulation”. My organization would vigorously disagree with this conclusion. Implementation of this obligation via regulation may be the easiest or most malleable implementation, but it creates a glaring loophole that could lead to high-risk arms sales being approved. In fact, it is precisely this type of loophole that led to the $15-billion Saudi arms deals to be approved under the existing EIPA regulations, against the better judgment of the Canadian public.

As such, my organization agrees with the testimony provided by several other witnesses before this committee which asserted that in order to comply with the ATT fully, Bill C-47 must oblige the Minister of Foreign Affairs to deny exports that carry an overriding risk of contributing to undermining international peace and security, or committing or facilitating serious violations of international law.

Our recommendation would be that Bill C-47 establish an obligatory minimum threshold for export approval as per the ATT. I posit, for example, that there is no need for flexibility around the question of whether or not Canada should approve an arms sale if the arms in question risk being used in human rights violations. If, according to government witnesses, additional flexibility is required to accommodate evolving threats and new international norms, let additional regulations address this need above and beyond the minimum threshold demanded by the ATT and codified in Bill C-47.

Regarding the need to report arms sales to the U.S. under Bill C-47 implementation of the ATT, a witness for the government suggested that accession to the ATT would not require Canada to track and report arms sales to the U.S. Nevertheless, a plain-English reading of the ATT would suggest otherwise. Article 1 of the ATT insists on the highest possible common international standards in the sale of arms, yet Canada's existing arrangement with the U.S. has neither a high standard nor a common standard.

Article 2 of the ATT makes clear that this implementation applies to all arms exports of acceding nations. Exempting Canadian arms exports to the U.S. specifically contradicts this obligation.

Finally, article 5 of the ATT calls for the treaty to be implemented in a consistent, objective, and non-discriminatory manner. A separate, less stringent process for Canadian arms exports to the U.S. clearly is not the consistent standard demanded by the ATT.

The government witness suggested that the ATT does not specify how states parties should organize their export control systems. This may be a fair statement as long as the export systems in question do not violate a nation's obligations under the ATT. However, Canada's arrangement with the U.S. under the defence production sharing agreement clearly does not meet Canada's obligation under the ATT.

For my final point I would suggest that as we consider Bill C-47, we should try to segregate the decision between our ethics and Canadian jobs. I suspect that privately many of the committee members here are as uncomfortable as I am with Canada's $15-billion arms deal with Saudi Arabia. However, because proponents of the deal have positioned it as a choice between questionable risks on the one hand and Canadian jobs on the other, the issue becomes a political hot potato. It is not surprising that elected representatives in successive governments would take the approach they have given that the alternative would be a form of political self-flagellation.

Therefore, I would recommend that Canada's implementation of the ATT include provisions to enable lawmakers to avoid this type of catch-22. Perhaps as a result of the role of the Canadian Commercial Corporation, the Saudi arms deal from the get-go was presented as a trade-off that would jeopardize well-paid Canadian defence jobs in London, Ontario.

Under Canada's accession to the ATT, the ethical issue should be addressed much earlier in the sales process, long before people are calculating the trade-off in Canadian jobs.

Naturally, a legally binding obligation on the minister, as required by the ATT, could help prevent many morally questionable deals from even being considered, but beyond that, CJPME would recommend that lawmakers look at other ways to segregate and front-load the ethical considerations of the deal before the potential economic benefits of the deal are promoted publicly. As mentioned above, there may be implications in terms of the ongoing role attributed to the Canadian Commercial Corporation.

The above discussions highlight some of our top concerns with the pending legislation. CJPME would recommend that if they have not already done so, committee members should be sure to review a document issued by a group of Canadian NGOs, CJPME included, entitled “Bill C-47 and Canadian Accession to the Arms Trade Treaty Civil Society Concerns and Recommendations”.

This document was officially released on October 16 and was the result of deliberations between many of Canada's leading NGOs on this issue, including CJPME. It details a number of items that go beyond the scope of my presentation here today.

I believe Canada has the opportunity to prevent unnecessary misery and suffering around the world as a result of unwise or illicit arms sales. My organization and I exhort this committee to propose the amendments necessary to ensure that Canada's accession to the ATT adheres to both the letter and the spirit of the treaty.

Thank you for your attention. I welcome any comments.

[The Chair, Liberal, Bob Nault]

Thank you, Mr. Woodley.

Thank you to all the presenters.

Now we'll go straight to questions.

Mr. Genuis, go ahead, please.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Thank you, Mr. Chair.

Thank you to the witnesses.

Maybe I'll start off with just a couple of observations. We heard again the observation on the value of parliamentary oversight. I note that our caucus supported at the beginning of this Parliament a motion to have a subcommittee of this committee look at issues around arms control, through a parliamentary process of course.

We had, I think, some recognition of the fact that we already have a strong oversight system in place, one that involves political discretion but that is a very strong system structurally. There was also the observation on the value of having good information in advance for civil society as well as for the arms manufacturing industry so there's some certainty moving into that process.

My questions will be generally for Ms. Cianfarani.

First of all, I would like to ask you about the impact this bill will have on subsidiaries. For instance, if we're looking at major American companies that have subsidiaries here in Canada, are there particular effects on them resulting from this bill that we should be aware of?

[Christyn Cianfarani]

Those subsidiaries are already subject to Canada's export permit requirements. The UN ATT will represent the fourth set of rules and regulations. When goods and services come from the United States, not only do the export permits from the United States follow those goods and services, but they are also swept up when they are implemented within Canadian platforms in Canada's export regime leaving the country. When both coming in and leaving the country, the goods and services are subject to Canadian export laws and permits and those from the receiving country.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

The protections already exist, and I appreciate that. Is there any added burden that this legislation will create for those types of operations in particular?

[Christyn Cianfarani]

First of all, we have yet to see the regulations, so it's hard for us to judge what it will entail. We are expecting, though, that because of the additional requirements around brokering, there will likely be additional governance structures put in place in companies, the need to identify who their agents are, and the need for these third party agents to have permits. This structure or this set of governance and these additional rules will most likely necessitate additional processes within companies in order to support the legislation.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

At a basic level, we know additional processes entail additional economic costs, for better or worse. We already have a strong system in place right now, but what you're saying is that through these brokering requirements, there will be additional processes and costs that will affect these subsidiaries.

[Christyn Cianfarani]

We fully expect that, yes.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

There is also a level of uncertainty about what exactly that will look like. We've heard from a variety of stakeholders that the government has provided a fair bit of flexibility for itself in terms of what it might or might not say regarding the regulations.

[Christyn Cianfarani]

Yes, indeed, although we expect to have conversations with the government as it rolls out the regulations. They have already consulted with us throughout this legislative process, and we would fully expect to be providing feedback during the regulatory phase as well so that we can prepare ourselves.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

One of the categories of concern we've heard about is from law-abiding firearms owners in Canada. There is some language in the preamble of the bill that is designed to reassure people in that community, but there's nothing in the text of the bill that actually provides substantive reassurance that there won't be, for instance, the collection of data that would effectively amount to a backdoor long gun registry. We have heard some witnesses propose what we've discussed before, which is the possibility of an amendment in the text of the bill that would very clearly prevent that kind of an evolution. Ms. Cianfarani, do you have thoughts on whether that type of an amendment would be acceptable to the people you represent?

[Christyn Cianfarani]

We don't have any thoughts on whether or not the amendment is required for the independent firearms owners because we don't represent that crowd of individuals. However, we don't see right now any need for such an amendment in the legislation.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

It's interesting because this is what's come up a few times. We have people who don't have a problem with that assurance maybe, but aren't sure if it's necessary. It's interesting that we're hearing from the firearms community that they would like that kind of reassurance.

I'll ask the other witnesses a question in the time we have left. Obviously, if we accept what the government says at face value, they're saying that the goal of this isn't to impact law-abiding firearms owners or lead to an increased paper burden or increased amount of data. Do you see any harm in putting that clarification not just in the preamble but in the text of the legislation?

[Anna Macdonald]

I think it would be unnecessary. The Arms Trade Treaty is about the international transfer of arms and ammunition between countries and territories that import, export, transit, and transship. It's not about domestic gun ownership, so I would see such wording as unnecessary.

[Thomas Woodley]

For my part, I really don't consider myself a subject matter expert in the area that you're probing.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Okay.

[The Chair, Liberal, Bob Nault]

Mr. Levitt, please.

[Michael Levitt, Liberal, York Centre, ON]

Thank you very much for your testimony.

Ms. Macdonald, I wonder if I could start with you. I want to explore a little more deeply the gender issues that you raised and the impact on women and girls. I don't want to put words in your mouth, but you said you didn't feel that there was adequate recognition of this in what's currently before us as it relates to the ATT. In the ATT, there is article 7(4):

The exporting State Party, in making this assessment, shall take into account the risk of the conventional arms covered under Article 2 (1) or of the items covered under Article 3 or Article 4 being used to commit or facilitate serious acts of gender-based violence or serious acts of violence against women and children.

We heard from Mr. Butcher from Oxfam last week that those articles would become binding because we sign on, regardless of the specific language in the regulations or legislation. Is there an additional step necessary, or do you feel that this will cover that? That's certainly what we had been told.

[Anna Macdonald]

Yes, I would agree with the colleague from Oxfam that it will become binding when you accede to the treaty. What I was doing in my statement was merely highlighting that this is a significant and important area of the treaty because it's the first treaty to specifically address gender-based violence.

I consider it an achievement that the language is put in there. I'm just encouraging Canada to take advantage of this provision in the treaty. Given that there's a strong correlation between that provision and the Canadian government's desire to see a reduction in gender-based violence around the world, this provides you with an additional instrument to pursue that policy.

[Michael Levitt, Liberal, York Centre, ON]

Absolutely. From your perspective, can you tell us a little bit to give us some background on the illicit arms trade and the gender impact and, in particular, how women and girls are affected? Can you give us a little more background on that?