Mr. Speaker, I will be splitting my time with the member for Drummond.
My ears were burning during the speech of my colleague from Sherwood Park—Fort Saskatchewan, because he spoke about members of the House objecting to CETA based on the investor-state provisions. Having given several speeches to that effect, I thought it was a good opportunity to engage with the arguments that he brought forward.
The member for Sherwood Park—Fort Saskatchewan essentially made two arguments as to why investor-state provisions are okay. He said that we need to have some sort of adjudication of the provisions of trade agreements. He also said that we live in a society with rule of law, where individuals and businesses can sue the government, can take the government to court. At some level I actually agree with both of those statements, but I do not think either one of them supports the kind of investor-state provisions that we see in CETA and a number of other trade deals.
If we talk about the need to have some sort of adjudication process to enforce the provisions in trade agreements, that is very true. Almost all provisions of CETA are subject to a government-to-government dispute resolution system, and it would be entirely reasonable to have the investment provisions subject to that same type of dispute resolution where, if investors felt that their rights had been breached, they would convince the government they had a legitimate case, and the government would bring that case forward. That is how every other aspect of the deal works.
What is objectionable about the investor-state provisions is they set up an entirely separate process of dispute resolution just for investors. They set up an entirely separate tribunal process that is available only to financiers and property owners, not other parties that might have concerns or complaints or issues under the agreement. What this leads to is a lot of frivolous cases being brought forward under investor-state provisions, because there is no need for investors to even convince their own government that they have a reasonable case that is worth bringing forward. They can bring forward a case to kind of try their luck before the tribunal. They can bring forward a case just to harass a foreign government and try to push back on its democratic laws, regulations, and policies. The problem is not with having some sort of enforcement process; the problem is with setting up this entirely separate and much more powerful enforcement process that is available only to investors.
The next argument we heard from the member for Sherwood Park—Fort Saskatchewan was about the rule of law and how, in our current society, individuals and businesses can already take the government to court. Exactly, so why is it that we need to set up this entirely separate process for investment disputes under this agreement? There are functioning court systems in both Canada and the European Union. I think members would agree that both jurisdictions have legitimate judiciaries. Therefore, how does the existence of rule of law justify creating some sort of entirely separate process?
The original justification for investor-state provisions in NAFTA was that American and Canadian investors were suspicious of the Mexican judicial system and did not have confidence in the Mexican courts. Perhaps that was fair enough, but I really do not see how we would have the same sort of doubts or lack of confidence in the European judicial system. We really have not heard an answer as to why we need this special set of investor-state provisions in CETA.
To illustrate what I am saying about frivolous cases coming forward when we empower investors to directly bring these complaints without even having to clear them through their own governments, it is worth reviewing some of the obnoxious chapter 11 cases that have come forward under NAFTA.
We have the Ethyl Corporation case, where an American company was selling a gasoline additive that had actually already been banned in the United States. The Canadian government tried to ban it as well and Ethyl successfully challenged the Canadian government under NAFTA for lost profits, got $13 million U.S., and had the Canadian government repeal that ban.
There was the AbitibiBowater case where that company shut down its last pulp and paper mill in the province of Newfoundland and Labrador. The provincial government reclaimed water rights that it had given to AbitibiBowater to operate the mills, but then the company challenged Canada under NAFTA for the loss of its water rights, which it was no longer even using for the purpose they were intended. Well, the previous Conservative government paid AbitibiBowater $130 million to withdraw that NAFTA chapter 11 claim.
We have the current case of Lone Pine Resources. Like AbitibiBowater, it is basically a Canadian company that has registered itself in the United States. It has launched a challenge under NAFTA over a ban on fracking in the province of Quebec depriving it of potential business opportunities. It is claiming some $250 million from our country.
Members can see that these investor-state provisions make it very easy for investors to come forward with almost frivolous cases just to see if they can get a favourable decision, just to sort of intimidate governments into paying them off. We do not want to replicate and amplify this under CETA.
Finally, I would point out that these investor-state provisions are actually having a pernicious effect on domestic politics in our own country. We are starting to see this in the Conservative leadership race where two of the contenders, the member for Regina—Qu'Appelle and the member for Beauce, are proposing to entrench private property rights in the Charter of Rights and Freedoms. Let us consider the arguments that the member for Lanark—Frontenac—Kingston made in endorsing this radical libertarian idea. He said:
The lack of constitutional protection for the private property rights of Canadians means that the rights of Canadians can be treated as second-class under NAFTA. Canadians deserve the same property rights that foreign companies enjoy in Canada....
We see that the presence of these investor-state provisions in free trade agreements is causing this proposal to entrench property rights in the Constitution. Let us consider some of the consequences of that. We have heard from the Conservatives a lot of rhetoric in favour of pipelines, but the reality is that the construction of pipelines, railroads, or highways depends almost all the time on the government expropriating some of the land along the route. If every single landowner along the route had a constitutionally enshrined veto, no pipelines, railroads, or highways would ever get built. Therefore, I would encourage the Conservatives to think through the implications of enshrining property rights in the Constitution before they get too excited about the idea, and before their leadership candidates trip over each other too much in trying to be the most libertarian.
We have seen that the investor-state provisions of free trade agreements, including CETA, are not necessary, given that the agreements have a much more sensible government-to-government dispute resolution process already, and given that Canada and Europe already have functioning court systems. There have been many cautionary examples under NAFTA of frivolous cases coming forward with the Canadian government having to pay outrageous amounts of money based on very strange claims. Finally, we see that these investor-state provisions are having a corrupting influence on the political philosophy of our official opposition and are leading the Conservatives down this path of extreme libertarian ideas.
For all of those reasons, I am pleased to speak and vote against this bill.