Nafta Chapter 20

[kato]

This week's Manitoba Cooperator had an article in it about the fact that Canada could have done something under Chapter 20 in the Nafta agreement.

The author seems to think that a challenge under this would have meant that the border would have been opened a long time ago.

Does anyone know anything about Chapter 20? And if so, WHY haven't our politicians used it?

Looking for answers..perhaps this needs to be added to our questioning of the politicians.

[rusty1]

This was persued very emfatically in Ottowa by some of the feedlot opperators back last spring. But our fearless and cowless ag leaders namly the ABP and CCA and Liberal running Ted Hanney along with the Fed's wanted to be Canadian about it. So they backed off.

[rsomer]

The purpose of Chapter 20 of NAFTA is to establish the Fair Trade Commission which meets once a year on a regular basis. There is a provision for the Fair Trade Commission to create an arbitral panel if a member country raises a dispute. What is being referred to is Article 2005 of Chapter 20 which stipulates that if a member country has a dispute concerning a measure adopted or maintained by a Party to protect its human, animal or plant life or health then the only recourse for settlement is NAFTA.

A Chapter 20 Arbitral Panel has only settled three disputes since NAFTA was signed. Mexico initiated 2 disputes against the U.S. and the U.S. initiated one dispute against Canada in 1996 involving tariffs on certain supply managed agricultural commodities e.g. yogurt and milk. In this case the U.S. challenged Canada before NAFTA in February 1995 and the panel issued its final report December 1996. Almost 2 years later. The U.S. lost, Canada won.

Countries are able, within NAFTA and GATT/WTO, to maintain their herd health and food safety. For instance, Mexico was able to block entry of U.S. meat products after the Washington Holstein just as the U.S. blocked our beef after May 20. This response is to be based on OIE guidelines which include BSE as as a listed disease. What we do see coming out of NAFTA last August is a call to the OIE for a science based response to BSE. However since then we have had the Washington Holstein and now the U.S. cannot export its own beef much less accept more Canadian product. This has certainly complicated a resolution.

Would Chapter 20 open the border to Canadian live cattle? The U.S. voluntarily accepted our bone out beef in September, could we use NAFTA to force the U.S. to accept our live cattle? I don’t know. It would take 2 years to find out however even if Canada had started the Arbitration process the day the U.S. closed the border. It certainly is not an option at this late date.

I am not sure NAFTA is a replacement for ineffective bargaining. For example Canada was within its rights to require tests of U.S. feeders coming into this country in order to keep our herd free of Bluetongue and Anaplas but we gave that up supposedly in return for the border opening to our feeders going south. The problem is when Canada did this we forgot to ask for a timetable when it would all happen. That oversight is cost our producers millions every day. Another example of poor bargaining is last April the U.S. agreed to accept our bone in beef and Canada reciprocated by accepting imports of U.S. bone in beef. A few days later the U.S. stops our bone in beef yet we keep on accepting the U.S. beef which according to a federal U.S. justice is not safe to eat. Canada was badly out maneuvered.

The problem we are facing is a lack of a timetable not that we need to use NAFTA to open the borders to our live cattle. When the U.S. and Japan established their talks on resuming imports of U.S. beef, a timetable was established. Canada has never negotiated for that. The real issue is not whether the border will open because it is certain to but rather the issue is when will it open because the industry could then plan ahead. In any event the border will open to live cattle before NAFTA could even reach any kind of decision, favourable or unfavourable to Canada.

Where NAFTA hurts Canada the most is that is has made us insignificant before the U.S. Before NAFTA our ace up the sleeve when it came to international trade with the U.S. was our huge reserves of energy. We threw that card away when we signed NAFTA and now we have nothing to negotiate with. NAFTA has made Canada weak and ineffective in matters of international trade.

[pandiana]

I am absolutely in agreement on this issue, rsomer. In addition to energy, our leverage extends to water which will soon become more 'volatile' than oil. The world is running out of primary resources. We do have some choices to make...keep them for our own industry and our future of sell them to the US on their terms at our expense.

[kato]

Should we be lobbying to have the expanded rules for allowing American beef and cattle in suspended until this whole thing is resolved?