International Trade Committee on March 3rd, 2009

[The Chair, Conservative, Lee Richardson]

If you were aware there were amendments and you wanted to look at them, you might have raised it prior to now, but I'll take the explanation of the clerk. In future, if members would like to get amendments earlier, by all means raise it with the committee.

We will now proceed with clause-by-clause. But first I want to let the committee know that should they have any questions as we go clause by clause, we have several witnesses available for clarification of any particular point, all of whom I think have appeared previously at the committee. We also have the general counsel for the Trade Law Bureau, if there are any specific legal questions, as well as the legislative clerk at my side as we proceed with clause-by-clause.

With that, I would like to begin with clause 1, which of course is the short title and is normally postponed to the end of the bill pursuant to Standing Order 75.

We'll turn to our package and look at clause 2. No amendments have been submitted on clauses 2 to 5, so I might suggest we deal with them together, unless anyone has any further comment on clauses 2 to 5 from the bill.

(Clauses 2 to 5 inclusive agreed to)

(On clause 6--Causes of action under Part I)

[The Chair, Conservative, Lee Richardson]

I understand there is an amendment to clause 6, and that would be from Mr. Keddy. Mr. Keddy is not here today, so I understand, Mr. Cannan, you're going to move that amendment.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Yes, thank you, Mr. Chair.

It was an oversight by the drafters. We're just removing the two words “or regulation”. I can give an explanation for the rationale.

The clause was based on subsection 6(1) of the Canada-Costa Rica Free Trade Agreement Implementation Act, which included a regulation-making power in part 1 of the act's section 17, which dealt with certain measures in relation to wine and distilled spirits pursuant to article III.8 of the Canada-Costa Rica Free Trade Agreement. Since that provision is not in the Canada FTA, this regulation-making power is not included in part 1 of the Canada FTA Bill C-2. Since no regulation-making power is created in part 1 of Bill C-2, the reference to regulation-making power in subclause 6(1) should be removed. The amendment would simply delete in subclause 6(1) “or regulation”--those two words--in the English text, and however you say it in French, “ou ses règlements”. The text below identifies the text to be deleted, bold and underlined.

I believe there was some information handed out with that? The clerk did not receive a copy of the amendment? I want to make sure everyone has it in front of them.

[The Chair, Conservative, Lee Richardson]

It's the first page of the package.

So is there any discussion on that amendment?

Mr. Brison, did you have a comment?

[Scott Brison, Liberal, Kings—Hants, NS]

What is the material change that results from the removal of “or regulation”? If it were not amended, what would be the material effect on the legislation?

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Mr. Chair, I could ask the professional staff who are here, but I understand there is no...it just cleans up the wording.

[The Chair, Conservative, Lee Richardson]

We have the general counsel of the Trade Law Bureau here. Ton, would you please explain?

[Ton Zuijdwijk, General Counsel, Trade Law Bureau, Department of Foreign Affairs and International Trade]

In answer to the question of what would happen if the two words were not removed, since there is no regulatory power in part 1, not removing these words would not have a material effect, but to make the draft as perfect as possible, we recommend these two words be removed.

[The Chair, Conservative, Lee Richardson]

All right. Is there any further discussion?

(Amendment agreed to)

(Clause 6 as amended agreed to)

[The Chair, Conservative, Lee Richardson]

Thank you, Mr. Cannan.

We are now going to proceed to clause 7, but before we do, I want to note that the next amendment we are aware of is on clause 33. Might I ask if there's any interest in moving along to clause 33? We might do that by grouping clauses 7 to 32 as one.

Let me do that, then. I'm going to ask if there's any discussion on any of those before we proceed.

Mr. Brison.

[Scott Brison, Liberal, Kings—Hants, NS]

I have a question on clause 31.

[The Chair, Conservative, Lee Richardson]

Well, then, I wonder if we might just do clauses 7 to 30, and then we'll get to clause 31.

[Scott Brison, Liberal, Kings—Hants, NS]

Okay, that's fine.

[The Chair, Conservative, Lee Richardson]

All right.

(Clauses 7 to 30 inclusive agreed to)

(On clause 31)

[The Chair, Conservative, Lee Richardson]

Mr. Brison.

[Scott Brison, Liberal, Kings—Hants, NS]

Mr. Chair, I have a question on clause 31, on the inclusion of NAFTA countries Chile and Costa Rica. I think I understand the rationale, but I'd like either the government members or the officials to clarify it.

[Dean Beyea, Senior Chief, International Trade Policy Division, International Trade and Finance, Department of Finance]

Mr. Chair, I can do that.

This clause introduces tariff treatments specifically for.... So the amendments...the NAFTA country is already there, Chile is already there, and Costa Rica is already there, given our free trade agreements with those countries. What you're doing is introducing Iceland, Liechtenstein, Norway, and Switzerland--the four members of the EFTA states. It's an amendment to an existing clause, so it's a repeat of the current clause and then the new additions. That goes throughout what we'll do in most of the customs tariff. The main purpose of what you're doing throughout the rest of this section is to introduce new tariff treatments for the three countries. There will be three tariff treatments: one for Switzerland and Liechtenstein together, one for Norway, and one for Switzerland.

[Scott Brison, Liberal, Kings—Hants, NS]

Thank you.

[The Chair, Conservative, Lee Richardson]

Mr. Cannan.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Thank you, Mr. Chair. I have a supplemental.

When Canada has other free trade agreements, would this agreement get amended or updated?

[Dean Beyea]

Right.

Canada's customs tariff includes the tariff elimination. The schedule to the customs tariff includes I think about 12 tariff treatments now. All of our free trade agreement tariff phase-out, as well as development programs like the least-developed country tariff, are all in that element.

[Ron Cannan, Conservative, Kelowna—Lake Country, BC]

Thank you.

[The Chair, Conservative, Lee Richardson]

Thank you, Mr. Cannan.

Thank you, Mr. Beyea, for that explanation.

(Clauses 31 and 32 agreed to)

(On clause 33)

[The Chair, Conservative, Lee Richardson]

We have received an amendment to clause 33.

Mr. Julian.

[Peter Julian, NDP, Burnaby—New Westminster, BC]

Thank you, Mr. Chair.

To facilitate our discussions, I note that there are 16 NDP amendments, but in a very real sense, I think, they should be grouped in four sections. The first section deals with the Iceland tariff. The second section of four amendments deals with the Norway tariff. The third is the Switzerland and the Liechtenstein tariff. The fourth section of four amendments deals with the tariff schedule generally. Understanding the agreement we have to go through these today, I think what we can have is essentially four discussions.

The first series essentially carves out shipbuilding from the Iceland tariffs. Essentially, we have four amendments that do the same thing.

Why propose this? I think we've just heard very substantive testimony from the shipbuilding industry. In fact, every single person who has come before us representing the shipbuilding industry, either as workers or as shipbuilding industry owners, has said the same thing. They want to see a carve-out of shipbuilding from the EFTA agreement. We have a unanimous recommendation from the shipbuilding industry and a very clear indication that if we don't carve out shipbuilding there will be negative impacts and there will be lost jobs, and that once you lose the shipbuilding industry, it is very difficult, with the brain drain that results, to reconstitute the shipbuilding industry afterwards.

It's very clear to me, Mr. Chair, that we have a unanimous recommendation from the industry that this will cause harm unless we carve it out. We have a responsibility, then, to do our due diligence and to change the implementation legislation so that shipbuilding is carved out. That's what the amendments propose to do.

This is a legislative responsibility that other legislatures and congresses take. We've seen it most recently with the U.S. and Peru, where the U.S. Congress essentially said they were going to change the implementation legislation. Peru later ratified those changes. We've seen it with the European Community and CARICOM. It was the same kind of situation, where some Caribbean legislatures reacted to the implementation legislation. The European Union is now essentially re-crafting those elements.

When we have a unanimous recommendation from the industry, it's a responsibility we have as legislators to say, essentially, that we must do our due diligence and change the implementation legislation to reflect the industry. All opposition parties have said in terms of EFTA that we're concerned about the shipbuilding industry.

The reality is, Mr. Chair, that if we carve out shipbuilding at the committee stage, there is no greater pressure that could be put on the government than to do that at the committee stage, so that essentially the government is forced to act on all of the other issues that, very clearly from the testimony we've heard, they've not acted on. On a combination of the ACCA and SFF, they haven't acted.

Carving out shipbuilding at the committee stage allows us to maximize that pressure so that the government can act. “Buy Canada” procurement policies and putting into place a real economic stimulus package for the shipbuilding industry allow us to put on that maximum pressure that the industry is asking for in order for the government to act.

Carving out shipbuilding at the committee stage makes good sense. It increases the pressure on the government and, in a very real sense, I think, puts shipbuilding front and centre in government priorities for the coming weeks.

We know the impact will be negative. We know that we have the opportunity as a committee to be either heroes or heels today. We can be heroes if we carve out shipbuilding at the committee stage. We'll be heels, I think, if we simply concede and say that we don't care about shipbuilding.

I think it is far more than a symbolic industry. We have the longest coastline in the world, yet we have a shipbuilding industry that is on the ropes. That is of symbolic significance to all Canadians, I think, but when you look at the economic ramifications in places like Nova Scotia of the shipbuilding industry going under, as has been clearly indicated by representatives of the shipbuilding industry, you can see that the economic repercussions could be enormous.

For all of those reasons, it's very clear to me that a carve-out is warranted; a carve-out is indeed our responsibility. It puts pressure on the government to take immediate action. When this implementation bill goes back to Parliament, then we can see the results of that action, and maybe some parties will want to change their position at that point. But today our responsibility is to hear the industry, to carve out shipbuilding from the agreement, and to force the government to act so that our shipbuilding industry does not go under.