Canada-China investment treaty under fire . . . .

Canada-China investment treaty under fire . . . .

Postby Oscar » Sat Sep 13, 2014 10:53 am

Canada-China investment treaty under fire; opposition renews calls for debate as public sours on Nexen takeover

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By Stuart Trew, Wednesday, October 17th, 2012

The last time an investment treaty attracted so much scorn in Canada we were fighting the Multilateral Agreement on Investment proposed by the OECD. It feels good to be doing it again.

The Canada-China Foreign Investment Protection and Promotion Agreement (FIPPA) has royally pissed people off, inside and outside parliament. Tens of thousands of Canadians have asked Prime Minister Harper to cancel the investment treaty and are putting pressure on the government to kill CNOOC’s planned purchase of Canadian energy firm Nexen. Now the opposition parties are turning up the heat, with the China FIPPA coming to trade committee on Thursday.

“While I welcome a briefing from Ministry officials, this is not nearly the level of public debate that needs to happen on such an important treaty,” said NDP Trade Critic Don Davies in a media release today. “I have called for Committee hearings and public debate so that we can hear from stakeholders and other experts about this deal. So far the Government has shown no willingness to allow such a debate.”

Tomorrow’s trade committee hearing should be open to the public, viewable from the ParlVu website. The committee meeting runs 3:30 to 5:30 p.m. but according to the agenda, the FIPPA with China will be discussed in the second half. The NDP are not the only opposition party to call for a debate on the investment pact. In fact, the feeling is unanimous outside the Harper vacuum.

Elizabeth May, leader of the Green Party, tried to organize an emergency House of Commons debate this month and wants Canadians to “Stand Up Against The Sellout to China.”

Wayne Easter, the Liberal trade critic, has spoken out against these investment protections as well, despite his party’s love affair with the FIPPA model since the Liberals signed NAFTA in 1994. To the Vancouver Observer this week, Easter described a 1997 NAFTA investment dispute from Ethyl Corporation challenging an inter-provincial ban on trade in MMT, a gasoline additive suspected of being a neurotoxin.

“Even though we were doing it for an environmental reason, under the investment rules it affected their future profit, and so the Government of Canada had to cut a check to Ethyl,” Easter said. “And that’s what can happen when a government makes a decision in the public interest that affects a company’s future profits of something they’re selling into the marketplace. It really takes your ability of public policy out of public interest hands, being the government, and puts into private investor hands.”

The opposition’s, er, opposition to a bilateral investment treaty with China is supported by widespread public unease that cannot be separated from the proposed Nexen takeover by Chinese state-owned oil company CNOOC.

An Angus Reid poll released yesterday suggests a majority of Canadians (58%) think the federal government should block the purchase, which it can do under the Investment Canada Act review process. Only 12 % think the deal should be allowed. Probably not coincidentally, the Harper government extended the review process. The NDP’s natural resources critic, Peter Julian, asked last week if we are going to have “a genuinely transparent and complete study of the deal or is it going to be 30 more days of secrecy and political games?”

But nor should the link between the takeover and the treaty be severed in people’s minds. The investment pact is the icing on the cake for Chinese state-owned energy firms because it would give them, and by rights the Chinese government, a de facto say in the development of Canadian resources, particularly in the west, where the Chinese share of tar sands is growing. Even Canadian oil executives are worried about foreign ownership, some of them asking Harper for “some ground rules in place before the next one.”

Andrew Nikiforuk’s recent article in The Tyee makes the Nexen-FIPPA connections crystal clear. “By Nov. 1 three of China’s national oil companies will have more power to shape Canada’s energy markets as well as challenge the politics of this country than Canadians themselves,” he starts. “And you can thank Prime Minister Stephen Harper for this economic treason.”

Nikiforuk cites articles by investment treaty expert Gus Van Harten, in which he listed examples of likely scenarios that would trigger an expensive, burdensome and secret arbitration against Canadian public policy. (Van Harten outlined his concerns in an extensive letter to Prime Minister Harper, which was also published at The Tyee.)

“Appallingly,” writes Nikiforuk in The Tyee, “the treaty would give Sinopec, one of the big Chinese backers of the Northern Gateway pipeline, the right to sue the government of British Columbia if it blocks the project. Sinopec could also demand that only Chinese labour and materials be used on the pipeline. Moreover, the treaty gives Chinese state owned companies ‘the right to full protection and security from public opposition.’”

These aren’t what-if scenarios. They are likely cases based on international examples of big mining and energy firms bullying countries through investor-state arbitration when things don’t go their way. More than a third of existing cases before the International Center for Settlement of Investment Disputes relate to mining, oil or gas.

It must be stated that U.S., European and other foreign firms already in most cases have a similar right to sue against public measures that hurt their profits. That does not make it right.

As Van Harten says in his letter to Harper last week, to cite past FIPPAs also ignores that Canada is a capital-importer in relation to China, and as such, “the Canada-China treaty effectively concedes legislative and judicial elements of our sovereignty in a way that other FIPAs do not.” The added worry in the China FIPPA is that it extends these excessive investor protections to the Chinese government itself.

Australia, which has had environmental measures threatened by Chinese state-owned gas companies under a bilateral investment treaty, has discontinued the signing of these sorts of corporate rights pacts and is refusing to participate in the investment negotiations within the Trans-Pacific Partnership trade negotiations. There is no good reason why Canada should not do the same. And yet this government has been signing new trade and investment pacts at a blistering rate. It is pure ideology at work.

Nikiforuk nails the fundamental problem with these treaties when he claims that the China-Canada treaty, “like all bad deals, comes wrapped in totalitarian paper. The deal does not require provincial consent. It comes without any risk-benefit analysis. And it can be ratified into law without parliamentary debate. The more Harper wants to do business with China, the more he acts like another tank in Tiananmen Square. Barring a revolt within Harper’s own party, the trade deal automatically becomes law on Nov. 1.”

Canadians aren’t taking the investment pact or the Nexen sellout sitting down. The Council of Canadians, Leadnow and SumOfUs are demanding, at the very least, a debate on the treaty, which has been denied in the House of Commons or trade committee so far.

“This deal would pave the way for a massive natural resource buyout and allow foreign corporations to sue the Canadian government in secret tribunals, restricting Canadians from making democratic decisions about our economy, environment and energy,” says the Leadnow joint campaign newsletter with SumOfUs.

The two organizations are asking people to write the Prime Minister “to reject the Nexen takeover and the Canada-China investment deal,” and to “start over with a national conversation that brings Canadians together to make responsible choices about the wisest long-term stewardship of our natural resources.”

There has not been a better opportunity since Harper came to power in 2006 to have a discussion in Canada on how the government’s trade and energy agendas work together undermine democratic options, at home and abroad, for resource development and conservation, now and for future generations. What Chinese firms will be able to do to Canadian policy via the FIPPA, Canadian firms (ex. Pacific Rim) have been ready to do in Latin America and other regions where mining and resource investment is intensive. (See Jen Moore’s article in The Star this week on why Canada should not ratify the Panama Free Trade Agreement in its current form.)

I should have mentioned this at the top of this article that we beat the MAI. It’s easy to forget these things, especially when faced with the Harper government’s unique attack on democracy and the environment. It can sometimes feel impossible, but these bad trade and investment deals can be stopped under the right conditions, with the write pressure. You can start by sending a letter to the Prime Minister today, spreading the word, and keeping the pressure on our opposition parties to do the right thing.

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Harper must tear up the Canada-China investment treaty

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October 2012

Canadians are fuming about the Canada-China Foreign Investment Protection and Promotion Agreement (FIPA), tabled quietly by the Harper government at the end of September. Tens of thousands of us have used action alerts like this one to ask Prime Minister Harper to cancel the investment treaty. It is resonating with opposition parties, which are demanding a public debate the government does not want to have. In fact, the FIPA will become law on November 1 unless we can stop it.


The Harper government’s new investment pact with China fundamentally undermines democracy. It will give Chinese firms in Canada and Canadian firms in China 31 years of “protection” – from environmental, human rights or resource conservation measures they don’t like. It gives companies and private investors the right to sue Canada or China in controversial private, unaccountable tribunals outside the court system.

As a net importer of Chinese investment, especially in energy and resources, the treaty will compromise what we can do to better manage mining and energy projects. Globally, mining and oil companies have used their excessive corporate rights in trade and investment treaties to bully or punish governments that don’t give them the project approvals they want.

Even when a project was cancelled or improved because the community demanded it, multinational oil and mining companies have demanded hundreds of millions in compensation. Investment panels have obliged them with ever growing awards paid by governments to corporations. This is of the greatest importance given the need to power down the tarsands and stop proposed pipelines to the west coast.


Demand parliamentary hearings into the Canada-China investment pact!

Phone or send a short email to your Member of Parliament today saying you oppose the Canada-China investment treaty and ask that the issue be debated in the House of Commons. You can use the form below to send a note to all MPs, or find your own MP’s contact information here if you want to send personalized letter. Phone calls can go a long way, so please consider phoning your MP today in support of a debate on the Canada-China investment pact.


Video by Caitlin Dodd, Heather Libby and Kai Nagata. Starring Dylan Burns and Kaylah Zander. Music by Kevin McLeod and used under a Creative Commons license.

What is the Canada-China investment treaty?

The Agreement between the Government of Canada and the Government of the People’s Republic of China for the Promotion and Reciprocal Protection of Investments is a bilateral investment treaty similar to what Canada has included in its free trade deals, or standalone investment deals (FIPAs), since NAFTA. These corporate rights pacts allow companies to sue governments when they feel their investments or profits have been undermined by public policies, including public health or environmental measures, or by delays to energy and resource projects.

These bilateral investment treaties (BITs, as some countries call them) have proliferated over the past decade to the point where today there are over 3,000 in effect between countries. Canada has dozens of FIPAs in place, mostly with developing countries where Canadian mining and energy firms want to establish or expand projects, with as few obstacles as possible. For example, the Harper government just announced the conclusion of a FIPA with Tanzania and is beginning negotiations with Nigeria. The right to sue the host country for policies or decisions they don’t like is very attractive to Canadian mining profiteers.

But in reality, this investor-state dispute process has been unambiguously harmful to Canada. Because of the investment protections in NAFTA, we are the sixth most sued country in the world, and the federal government has paid out $157 million in awards and settlements to foreign investors. It is perverse that Canada continues to pursue ever larger investment treaties with China, with the European Union through the Comprehensive Economic and Trade Agreement (CETA), and in the Trans-Pacific Partnership trade negotiations, which Harper recently joined.

Let the oil profits flow freely

The investment pact with China will notably allow Chinese energy companies, once they are established in Canada, to threaten the federal, provincial or territorial governments against imposing environmental rules on tar sands production, pipeline construction and other projects. Delays or denials on energy and mining investments could result in costly lawsuits outside Canada’s courts, which will be settled by unaccountable private arbitrators with a vested interest in the outcome. It’s a corrupt process to begin with, made more so by the lack of transparency in this particular investment treaty. It will be up to the Chinese government whether any of the investment lawsuits are made public or not.

Chinese firms are almost certain to make use of their new treaty protections as they increase their investments in Canadian energy and resource projects, including through the planned CNOOC purchase of the Canadian energy firm Nexen. About one in five investor-state lawsuits relates to resource extraction, and at least nine of the NAFTA investment lawsuits against Canada involve resources. For example, U.S. firms Exxon Mobil and Murphy Oil had no qualms about suing Canada under NAFTA because they did not like having to transfer a portion of their profits into research and development in Newfoundland and Labrador. A private NAFTA tribunal ruled earlier this year against the R&D measures. Canada is on the hook for another $65 million, most of that to be paid to 2011’s richest company in the world (Exxon).

There IS an alternative

Ideologues like the Harper Conservatives will argue that investment treaties are an important tool for attracting foreign investment to Canada but there is no evidence to back this up. On the other hand, the evidence keeps piling up that the pacts undermine democracy by making corporate rights to profit more important than environmental and other social priorities. In a very real sense, this China deal and other investment pacts are tools for locking in and expanding controversial resource projects like the tar sands in Alberta, the digging of mega-quarries in Ontario, or hydro-fracking for natural gas across Canada.

Last year, the Australian government, faced with the threat of investor-state challenges to public health measures related to cigarettes (plain packaging laws) and environmental regulations on coal-fired plants, decided it would not negotiate protections like the ones in the China-Canada deal into its own trade deals. If companies wanted to invest abroad, they should take out insurance instead of dumping the financial risks onto the Australian public. When companies invested in Australia, they should have no greater rights than local companies whose disputes with government policies must go through national courts.

Send a letter to your MP today saying you oppose this unfair corporate rights pact and demand a public debate!

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UPDATE: Canada-China FIPA to be ratified within days

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By Brent Patterson, Wednesday, October 31st, 2012

We only have days to stop the 31-year Canada-China Foreign Investment Protection and Promotion Agreement. The Globe and Mail reports, “The Harper government will be in a position to ratify a highly controversial investment treaty with China on Thursday (November 1), but is not indicating when it intends to give final endorsement to the deal. …As of Thursday, the government can ratify the deal through an order-in-council, though it now appears that ratification will wait until Mr. Harper returns from an eight-day trip to Asia, which begins Saturday (November 3 and concludes on November 9).” A recent Foreign Affairs and International Trade Canada release states, “All interested parties are invited to submit their comments on the Final Environmental Assessment of the Canada-China FIPA by Sunday, November 11, 2012.”

The Union of British Columbia Indian Chiefs statement of opposition to FIPA can be read at

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The Assembly of Manitoba Chiefs letter to the Minister of Commerce for the Peoples Republic of China expressing concerns about the deal can be read at

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To take action against the Canada-China FIPA, please go to

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LET’S FILL HARPER’S EMAIL: Protest the Canada-China FIPA agreement

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By Council of Canadians, Wednesday, October 31st, 2012 More Sharing

This action alert is reposted from One Big Campaign in co-operation with dozens of other concerned Canadian organizations and individuals.

Send your message to Harper to arrive in Ottawa Thursday 2-4PM.

The Canada-China FIPA deal is an outrageous secret trade agreement.

Amongst other unilateral freedoms, this agreement will allow Chinese companies to sue Canadian governments if they do anything to limit Chinese companies’ profits in our country.

Join Canadians from across the country on Thursday and send out a protest email to key federal government and industry officials.

This is what you can do:

a) Send your protest email to the following government and industry contacts between 2 and 4 p.m. EST on Thursday.

b) Check your time zone to make sure that the email arrives in Ottawa between 2-4PM.

Newfoundland & Labrador: 3:30-5:30 PM
Maritimes: 3-5 PM
Ontario & Quebec: 2-4 PM
Manitoba & Saskatchewan: 1-3 PM
Alberta & NWT: Noon to 2 PM
BC & Yukon: 11AM to 1 PM

c) Give the government a piece of your mind – or copy and paste this message…

“I am strongly opposed to the undemocratic FIPA agreement the Canadian government plans to finalize with the Chinese government. It will give a foreign country and foreign corporations more power than our democratically elected governments. Are you not concerned about what this will mean for Canadians? (Signed, your name)

From One Big Campaign

[ ] in co-operation with dozens of other Canadian organizations and concerned individuals.

In particular, thanks to the members of CRUSH for their outstanding hard work!

Tags: FIPA
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