A left-leaning think tank in Ottawa is urging the Canadian government to side with the US in a NAFTA dispute over the cancellation of the Keystone XL pipeline to the Gulf of Mexico..In a report, the Canadian Centre for Policy Alternatives — a self-described champion of ‘environmental justice’ and ‘social policy’ — urges the Liberal government to back the Biden administration’s decision to axe the project on his first day in office..Calgary-based TC Energy, the company proposing to build the line, is suing the US government for US$15 billion under the terms of the old North American Free Trade Agreement, which has since been superseded by the US-Mexico-Canada (USMCA) agreement that came into effect in 2020..When USMCA replaced NAFTA on July 1, 2020, it phased out the right of Canadian and U.S. investors to bring forward these disputes. However, carry-over provisions allow claims regarding investments made before July 1, 2020 — such as TC’s — to be filed until a July 1, 2023, cut-off date..Likewise, the Alberta government is suing the US for $1.3 billion under the old NAFTA rules. If built, the pipeline would have increased Alberta’s oil sands export capacity by more than one million barrels per day..According to the CD Howe Institute, the NAFTA provisions are similar to investor-state dispute settlement (ISDS) provisions in hundreds of bilateral treaties around the world..“They give investors the right to invoke binding arbitration when governments are alleged to have breached treaty obligations, allowing the investors to bypass local courts in favour of neutral, third-party dispute settlement.”.The ISDS provisions in trade treaties were meant to guarantee “fair and equitable” treatment from host — and hostile — governments in the developing world to protect against arbitrary seizure of assets. There are now about 2,300 of those bilateral agreements around the globe..TC Energy originally filed its case against the Obama administration, but was persuaded to drop it in 2017 after Donald Trump promised speedy approval, which was granted in 2020 under the old NAFTA rules. .That permit was subsequently overturned by a Biden executive order on his inauguration on Jan. 20, 2021 after the USMCA came into effect, prompting TC to refile the suit on July 2, 2021..The US government is arguing TC’s legal challenge is no longer valid under the new rules..The CCPA is arguing Canada should instead “prioritize defending democracy and the planet over appeasing the oil and gas industry.”.“The idea an investor’s right to profit — even from socially or environmentally harmful activities — should trump our democratic right to set responsible climate policy is offensive,” the authors wrote.
A left-leaning think tank in Ottawa is urging the Canadian government to side with the US in a NAFTA dispute over the cancellation of the Keystone XL pipeline to the Gulf of Mexico..In a report, the Canadian Centre for Policy Alternatives — a self-described champion of ‘environmental justice’ and ‘social policy’ — urges the Liberal government to back the Biden administration’s decision to axe the project on his first day in office..Calgary-based TC Energy, the company proposing to build the line, is suing the US government for US$15 billion under the terms of the old North American Free Trade Agreement, which has since been superseded by the US-Mexico-Canada (USMCA) agreement that came into effect in 2020..When USMCA replaced NAFTA on July 1, 2020, it phased out the right of Canadian and U.S. investors to bring forward these disputes. However, carry-over provisions allow claims regarding investments made before July 1, 2020 — such as TC’s — to be filed until a July 1, 2023, cut-off date..Likewise, the Alberta government is suing the US for $1.3 billion under the old NAFTA rules. If built, the pipeline would have increased Alberta’s oil sands export capacity by more than one million barrels per day..According to the CD Howe Institute, the NAFTA provisions are similar to investor-state dispute settlement (ISDS) provisions in hundreds of bilateral treaties around the world..“They give investors the right to invoke binding arbitration when governments are alleged to have breached treaty obligations, allowing the investors to bypass local courts in favour of neutral, third-party dispute settlement.”.The ISDS provisions in trade treaties were meant to guarantee “fair and equitable” treatment from host — and hostile — governments in the developing world to protect against arbitrary seizure of assets. There are now about 2,300 of those bilateral agreements around the globe..TC Energy originally filed its case against the Obama administration, but was persuaded to drop it in 2017 after Donald Trump promised speedy approval, which was granted in 2020 under the old NAFTA rules. .That permit was subsequently overturned by a Biden executive order on his inauguration on Jan. 20, 2021 after the USMCA came into effect, prompting TC to refile the suit on July 2, 2021..The US government is arguing TC’s legal challenge is no longer valid under the new rules..The CCPA is arguing Canada should instead “prioritize defending democracy and the planet over appeasing the oil and gas industry.”.“The idea an investor’s right to profit — even from socially or environmentally harmful activities — should trump our democratic right to set responsible climate policy is offensive,” the authors wrote.
