Update on the Canada-EU Comprehensive Economic And Trade Agreement (CETA)


This is an update to our publications dated May 19, 2016 [https://www.cwilson.com/update-canada-eu-comprehensive-economic-and-trade-agreement-ceta/] and September 29, 2014 [“MASH Sector Needs to Brace for Possible New Era in Procurement – Canada-EU Comprehensive Economic Trade Agreement (CETA)”].

New date set for provisional application of the agreement

Prime Minister Justin Trudeau and the President of the European Commission, Jean-Claude Juncker, issued a joint statement July 8, 2017 in Hamburg, Germany at the G20 summit announcing that they agreed to set the date of September 21, 2017 to start the provisional application of the agreement. Trudeau stated that 98 per cent of the deal will come into effect on this date. The date had previously been set for July 1, 2017, but was pushed back due to a snag over the provisions of the agreement regarding the dairy industry.

The Canadian Parliament’s bill on CETA, Bill C-30, received Royal Assent on May 16, 2017.

What about the Provinces?

In our publication dated May 19, 2016 we asked “Can the Government of Canada do this on its own?” Do the Provinces and Territories have to agree, and pass their own legislation, to adopt the agreement and make it binding upon them? The Provinces and Territories were parties to the Agreement on Internal Trade [AIT], for example, which made it binding on them; but are not parties to CETA. There is a constitutional division of powers between the federal government and the Provinces and Territories. The federal government has sole authority to negotiate, sign and ratify international treaties. But implementation and compliance are areas of joint responsibility with the Provinces and Territories. In the 1937 Labour Conventions Case the Privy Council held that the federal government cannot use the need to comply with international treaties as justification for encroaching on areas of provincial jurisdiction.

The federal government is fully responsible to the international community for compliance with the treaties that it signs. Her Majesty is indivisible. In order to limit Canada’s liability where a treaty concerns an area of provincial legislative jurisdiction, some treaties contain a “federal state clause” qualifying its liability to performing only those international obligations that come within federal jurisdiction. CETA does not contain this clause. Rather, Article 1.8 of CETA reflects that the federal government will be fully responsible for CETA, stating: “1. Each Party is fully responsible for the observance of all provisions of this Agreement. 2. Each Party shall ensure that all necessary measures are taken in order to give effect to the provisions of this Agreement, including their observance at all levels of government.

There has been no sign yet of legislation by the Province of British Columbia adopting and implementing CETA. Chapter 6 [Procurement] of the Core Policy and Procedures Manual of the Ministry of Finance (British Columbia) still has no mention of CETA. In Ontario, implementation of CETA might be rolled out by way of an updated Broader Public Sector Procurement Directive, but that has not yet occurred.

It remains to be seen how the federal government and the Provinces and Territories will or have coordinated for the implementation of CETA. The federal government has gone a long way with the agreement and made specific promises about the Market Access Offer of the Provinces or Territories. They seem confident that the Provinces and Territories will follow suit. Perhaps any reluctant Provinces and Territories will be swayed to comply through ties to federal funding. But one need only consider the list of exclusions under the Canadian Free Trade Agreement (which recently replaced the AIT) to see how regional interests and politics may have a strong influence.

Universities and other MASH sector entities

Once we see how CETA is rolled out in the Provinces, we can examine how it will apply to universities and other MASH sector entities. Some entities are “agent” of the Province, and therefore would be bound to the extent the Province is bound. Other entities are not agent of the Province. For these, further consideration will be needed.