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Submissions to the Standing Committee on Environment and Sustainable Development Regarding the Investor-State Suit Provisions of the Multilateral Agreement on Investment (MAI)

Environmental Assessment, Trade
Shrybman, Steven

Thank you Mr. Chair and Members of the Committee for inviting me here today. As you will know from the material we have provided, our Association has several broad concerns about the impacts of the Multilateral Agreement on Investment (MAI). We should also indicate that we have reviewed the submissions of our colleagues on this panel and are supportive of their submissions. Rather than repeat concerns that have been canvassed by our colleagues, and in the materials we have filed, we will concentrate our comments on the investor-state suit provisions of this investment treaty.

Our Association has worked for over two decades to establish and defend the participatory rights of all Canadians to be involved in environmental decision making processes. Whether the forum is an informal, consultative process or the superior courts of the land - we believe that these rights are essential for the development of sound public policy and law with respect to all societal goals. They are no less than the hallmarks of a democratic society. For this reason we appear here today to express our grave concerns about the impact of these particular provisions of the MAI because of their far reaching and adverse implications for the very founding principles upon which our justice system has been established.

As this Committee will know, the investor-state provisions of the MAI are not unique, but rather build on similar provisions found in Chapter 11 of NAFTA and in several bilateral investment agreements that Canada has negotiated in recent years. However, the potential implications of these precedential agreements have gone largely unnoticed and have never, to our knowledge, been the subject of informed debate in this country.

In broad terms, the investor-state suit provisions of the MAI, and the precedents upon which they rely, extend the principles of international commercial dispute resolution to a vast and new array of potential disputes that have very little to do with international legal commercial relationships. In effect, the MAI would provide foreign investors with a large number of new substantive rights, which then can be enlisted to challenge a diverse array of government policies, programs and laws. We believe that this transposition of the principles of international commercial dispute resolution to the virtually unbounded domaine of investor-state disputes engendered by the MAI, was accomplished with very little analysis or consideration of the potential public policy consequences of such a transformation.

There has certainly been no informed debate about the consequences of these initiatives in this country, and we are unpersuaded by the assurances of the Department of Foreign Affairs and International Trade that these developments are without any adverse public policy implications. Quite to the contrary, we believe that these aspects of the MAI, and of the agreements upon which it would build, represent a profound challenge not only to the progress of environmental policy and law, but as well to the very democratic foundations of our legal system.

The principle of encouraging the resolution of international commercial disputes in accordance with normative arbitration processes may have sound public policy support when those disputes are essentially commercial in character, and founded most often in contractual relationships between parties of relatively equal bargaining power. However, when those regimes are applied, holus polus, to the resolution of disputes that concern the broadest sphere of public policies, which have no grounding in contract, and which may, only in the most tangential way, be considered commercial in character - the potential consequences create very real challenges for the democratic norms of Canadian society.

The following submissions are not offered as an exhaustive or rigorous review of the policy, legal and constitutional issues that arise in this context. It is telling, in our view, that a search of the legal literature, and of the public record, suggests that the issues we raise have yet to be given any meaningful consideration. In our view, it is critical that they be submitted to thorough and public scrutiny before any further steps are taken to proceed with them.

Rather, our submissions are intended to identify a number of issues that should give rise to very serious concerns about the compatibility of the investor-state suit provisions of the MAI, and other investment agreements, with the fundamental principles of justice upon which our society is founded.

Publication Date: 
February 1, 1998
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