International Trade Committee on Feb. 26th, 2020

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Neil. I'm sure there will be a lot of questions.

Mr. Carrie.

[Colin Carrie, Conservative, Oshawa, ON]

Thank you very much, Madam Chair.

I want to thank all of the witnesses for being here.

I'd like to start today with Mr. McGuire. First of all, I want to thank you, sir, for all of your work and support in making sure that there is an agreement. We on this committee travelled down to the United States a few times, and it was really nice to see the support in the American business community for making sure that we got a deal done.

You made a couple of comments—I want to correct the record a bit—that there may be a delay in passing this. There was a bit of a whisper campaign in Washington that the Conservatives were trying to slow this down. If you're talking to any of your friends down there, just so you know, the Conservatives moved this through the House in six sitting days. That's compared with 16 days for the original implementation legislation, which was our Bill C-100. The Conservatives offered to do a prestudy back in the spring, but the Liberal government declined to do that before the election. We also offered to come back in early in December to deal with it, and the Liberal government declined that offer as well. I just want that to be clear. This will eventually pass, but it's not because of anybody on this side of the table slowing things down.

I want your comment on the buy American clause. Our former prime minister, Mr. Harper, was able to get a Canadian exemption from that. My understanding is that with this agreement, Mexico has an exemption and Canada doesn't.

What are your thoughts on that and what do your members think, given that many of them who buy your equipment build infrastructure, bid on infrastructure? Do you have comments on this buy American clause? We had an opportunity to negotiate it out—this is supposed to be a free trade agreement—but unfortunately we weren't successful.

[Brian P. McGuire]

Thank you for the opportunity to comment.

AED has traditionally opposed such provisions, whether they arise as part of proposals in the U.S. Congress or as part of trade deals. Our stance on those types of provisions is that we have not been supportive of them, and we continue that opposition. Most of our equipment is multi-sourced, as you might imagine, so such provisions don't foster good business practices in the equipment sector.

[Colin Carrie, Conservative, Oshawa, ON]

It was extremely disappointing to many of our stakeholders.

On the panel just before you, we had a gentleman involved in building infrastructure. He was very concerned that because the government was unable to negotiate it out of this agreement, it could be problematic for him.

Thank you for your comments on that. It's nice to see there are similar thoughts on both sides of the border. We can maybe do something to move that forward.

Mr. Neil, I want to talk to you. First of all, thank you for coming in.

We had another witness—I think you know Professor Michael Geist—who is a leading expert in the world. He's done work not only in Canada, but in the United States and the U.K. He mentioned challenges with CUSMA as well. He had a more, let's just say, grave comment. He said that we have this cultural exemption, but the cost is that we open ourselves to retaliatory tariffs. I believe he cited CUSMA article 32.6.4, which I think you mentioned in your opening remarks. There are some wording issues in 32.6.3 as well. There is a big concern that it would limit our policy options as the digital field evolves.

I am wondering if you could comment on that. I realize that you want this passed, and I understand the rationale for it. From our standpoint on this side, we are certainly not going to do anything to slow it down, but we want to do our due diligence.

In your opinion, sir, is there a fix to this glaring, I would say, failure in this agreement? Opening ourselves up to these retaliatory tariffs or limiting our policy options in the digital field and how it's evolving so quickly are problematic. Do you have a [Technical difficulty--Editor]?

[Garry Neil]

Thank you.

It's interesting, because I know Michael Geist very well. He and I have been on the opposite side of many issues, but I don't really disagree with him on this one.

The question you have to consider is the degree of threat that any retaliation clause represents. NAFTA had a retaliation clause. There was only one case in our history when the U.S. even threatened to retaliate. They didn't retaliate, but the threat was put on the table. That's the only case.

Yes, if they are still able to retaliate, I'm worried about that. I think we should all be worried about that. I would have felt far, far better had it been removed from the agreement, but it wasn't. I think on balance, when you have the strength of the cultural exemption versus the theoretical risk of additional retaliation, which we have never experienced in our history, I think it's work pursuing.

My greater concern is the limitations we've already agreed to and impose. We're kind of narrowing our cultural policy scope as we go through each of these trade agreements.

[The Chair, Liberal, Judy Sgro]

Thank you very much, Mr. Neil.

I'm sorry, Mr. Carrie, but your time is up.

Mr. Sarai.

[Randeep Sarai, Liberal, Surrey Centre, BC]

Thank you, Madam Chair.

I want to thank all of you, obviously. You all come from a range of different fields and have analyzed this.

My first question is for Ms. MacEwen. I want to say that you're very well-informed on this. On behalf of your membership, you made a very broad analysis in a very concise period of time for us.

You've stated that it helps labour rights much more than ever before. I think on biologic drugs it's much better, as you have stated, which will help with future plans for pharmacare. There was some other stuff, I think. I can't quote you on that exactly, but, in terms of pharmacare, it would help, from what you stated.

Have you, your union or other unions like yours been consulted in this much detail with other trade agreements or is this a first? Has it been ongoing?

[Angella MacEwen]

Before being the economist at CUPE, I was the economist at the Canadian Labour Congress. I definitely was involved in consultations around previous trade agreements under Stephen Harper's government. Those consultations were very much one-way. It would be a webinar. You would try to ask questions, and they would just ignore your questions.

Definitely, during the process for NAFTA, we were able to come to negotiating rounds. We could ask the negotiators questions. The staff took lots of time with us and were willing to meet with us regularly. I just want to say that the labour folks were amazing. They took a lot of time with us and really were great, but so were other people. They were happy to have us challenge their perspective on the trade deal and engage with us in a really productive way, which was valuable. I would definitely hope to see that continue, because there's nothing that mandates it. The political will of the current government allowed it to happen.

[Randeep Sarai, Liberal, Surrey Centre, BC]

I'm glad to hear that. I'm hopeful that all future governments, whether this government or any other future government, always consider labour as an important and integral factor.

Were you able to do, or did you do, an economic analysis for your membership or the Canadian public sector on the ramifications of having a deal, not having a deal, this current deal, etc.? Would you be able to elaborate on that? Would the deal protect the current jobs that are here or perhaps enhance more?

Have you done that sort of analysis?

[Angella MacEwen]

That's one of the problems with the way that we negotiate trade deals, because you don't know what the changes are going to be until it's kind of.... We didn't know the whole deal until December because the United States made changes to it. It's very difficult to do any kind of economic impact assessment until you have the deal finalized, so we haven't had an opportunity to do that.

What we have had is some projections around the cost of medicines. We know that this will improve, especially compared to what was in the TPP. That's fantastic.

Apparently during the first NAFTA negotiations under Brian Mulroney's government, there was a lot of data that was available to people and shared with the public around modelling and what type of industrial impact that would have. Maybe talk to people who were in government at that time and knew what was very open in terms of the public modelling and allowed that to happen as negotiations were going forward.

We didn't have access to that type of data, but we definitely did our best.

[Randeep Sarai, Liberal, Surrey Centre, BC]

Thank you.

To Mr. Johnston from the Songwriters Association, I understand that your concern is over copyright—namely, copyright life plus 70 years versus copyright life plus 50 years. If I'm right about what I've been hearing, not just in the cultural world but also in other copyright sectors that have come here, it's more of a fear that if ever we were to change it, the Americans may retaliate. However, am I correct in saying that the U.S. has a copyright of life plus 70 years and that, if we were to match them, it would not be of any detriment or threat to them?

[Greg Johnston]

In fact, us ratifying our copyright term extensions to theirs creates investment opportunities for Canadian publishers to administer the rights on American copyrights for the full term allowed, whereas, as it stands now, you could have a work approaching public domain, which would happen sooner in Canada than in the U.S., and that would be a disadvantage for a Canadian publisher. They would not be able to collect and administer the rights for the same amount of time that a publisher in the U.S. would be able to.

[Randeep Sarai, Liberal, Surrey Centre, BC]

This is something that you could probably have ongoing.... I guess it would fall under ISED. I haven't really delved into this for too long, but it would be something that, even post-ratification of CUSMA, we could continue to do. I don't think the copyright provisions per se are negotiated in this.

[Greg Johnston]

I'm not a policy expert or a lawyer. I'll defer to Mr. Neil's more precise understanding. In general terms, though, we're looking for ratification, and we're looking for an unencumbered ratification. We don't want there to be a re-registration process after the 50 years. We would simply like to harmonize it with the majority of our trading partners.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Mr. Savard-Tremblay.

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

I want to thank all the witnesses for their presentations.

I would like to ask Mr. Neil about the cultural exemption. As you said, my party was an outspoken advocate on this front, as was Quebec, because we wanted it recognized by UNESCO and included in the convention.

You said CUSMA is a step forward compared to NAFTA because it mentions the cultural exemption, but there are different ways of including exemptions in agreements. In some cases, such as the Canada-European Union Comprehensive Economic and Trade Agreement, CETA, it was chapter by chapter. That means the cultural exemption applies not to the whole agreement, but only where it is mentioned.

What kind of exemption is in CUSMA?

[Garry Neil]

It is a universal exemption. It's an exemption from all of the provisions.

Let me briefly compare it with CETA. The difference with CETA, the difference between CETA and the CPTPP, is that the chapter-by-chapter cultural exemptions were mutual. Both Canada and Europe agreed that cultural industries would be exempt from those obligations. There is an asymmetrical definition—for us it's cultural industries and for Europe it's audiovisual services—but it's a mutual understanding. Those chapter-by-chapter mutual exemptions are underpinned by a strong recognition of our mutual support for the UNESCO convention. It's a very, very powerful way to exempt, but it's unique because it's basing it, in some ways, on the UNESCO convention.

In my opinion, a future progressive trade strategy for culture would be to base it on the UNESCO convention, where both parties are signatories to the convention, as the fundamental underpinning.

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

Perfect.

Generally speaking, you seem fairly satisfied with the provisions governing culture in the agreement. Is that right?

[Garry Neil]

Yes.

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

Okay.

My next question is for Ms. MacEwen, national services senior economist at the Canadian Union of Public Employees.

You seem equally satisfied with the labour-related parts.

Last week, witnesses told us that most of the labour-related provisions with actual teeth affect only the auto industry and that the rest is merely intention. Do you agree with that criticism?

[Angella MacEwen]

Definitely there are parts of the labour chapter that are aspirational, but there are also requirements, especially concerning Mexico and the right to collective bargaining.

Right now, only about 1% of trade unions in Mexico are democratic, independent trade unions. The current government had wanted to make some change on that front, and the labour chapter and the side agreement with Mexico and the rapid-response mechanism all give them a forum and will help them get that done domestically.

It will make a big difference in terms of bringing democratic trade unions to workers in Mexico, but it also sets a floor and it gives us somewhere to bring complaints about labour violations and hopefully get some changes to happen.

There is more enforcement than there has ever been in a trade agreement.

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

Those mechanisms apply only to Mexico. You only mentioned Mexico.

Does that apply only to Mexico?

[Angella MacEwen]

There is a unique side agreement with Mexico that deals with they what they call “yellow unions”. The rapid response mechanism is between Canada and Mexico, and between the United States and Mexico; it doesn't apply between Canada and the United States. So there are those two parts, where, in terms of Canada's concern, it's just with Mexico.

The labour chapter is trilateral; it's between all three countries. We can bring complaints of labour violations through the labour chapter and we'll have a much better chance of those being successful. The way the burden proof had been, it was impossible to ever win a labour dispute settlement, but we now have the hope that it's possible.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

We'll go on to Mr. Blaikie.

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

Thank you, Chair; and thank you very much to all the witnesses for appearing here today.

Ms. MacEwen, I want to go back to some of your comments about consultation. Granted, we have heard that a number of organizations typically are not satisfied with the level of consultation, more than those that feel they were more included. However, as you say, that depends upon the political culture of the day and the whims of government. It's always nice when winds tend in the right direction, but it's not the same as a guarantee.

It's something that we, in the NDP, have tried to make part of this process of talking about trade. We're happy to get some commitments from the government on making at least their initial negotiating objectives public before entering into negotiation, and having to provide an economic impact assessment—which seems like an odd victory, because you'd think it was common sense. Certainly, in a lot of other jurisdictions with which we trade, it is part of their process. We have that coming now in Canada. It's a good first step.

Could you speak a bit more about the importance of civic engagement and what it means to have, as matter of policy or law, clear expectations about what type of information Canadians can expect to get from their government with respect to trade agreement negotiation, and the difference that can make?