The BC/Alberta Trade, Investment, and Labour Mobility Agreement
A Summary of Its Impacts by Ellen Gould
“Within the TILMA are the seeds of a true economic union, an erasing of the provincial
boundary for all purposes except voting and the color of the license plate.” Todd Hirsch, Canada West Foundation, July 15, 2006
If the Campbell government was going to erase the border with Alberta, shouldn't it have had a consultation with the province's citizens first? The “Trade, Investment, and Labour Mobility Agreement” (TILMA) was signed by Alberta and BC in April 2006. It is posted on the Internet at tinyurl.com/krqrb [please note: this opens an interesting but large .pdf file]. With no public consultation process, Campbell and Klein signed this agreement that (among other things):
- Allows private individuals to sue and get up to $5 million compensation for regulations, policies, and programs that “impair or restrict” investment, trade, or labour mobility. Alberta and BC will also be able to sue each other for any violation of the agreement. A three person dispute panel will have the power to make legally binding decisions that will compel these governments to change their policies, no matter how popular these policies are.
- Is a major step towards "deep integration" with the US. Complaints about differences in provincial regulations are made repeatedly by the US Trade Representative. At the most recent Pacific Northwest Economic Region conference, representatives of north western US states and BC and Alberta committed to explore the possibility of "expanding the B.C.-Alberta Trade, Investment and Labour Mobility Agreement (TILMA) /concept/ throughout the PNWER region."
- Goes far beyond NAFTA in enabling commercial interests to sue for regulations they don’t like. NAFTA allows private investors to sue under NAFTA’s Chapter 11, but TILMA allows these suits over “any matter regarding the interpretation or application of this Agreement.” While TILMA restricts compensation to $5 million, private interests could all line up to get compensated once one complaint has been successful. This will force governments to change their policies. Alberta’s Minister of International and Intergovernmental Relations, Gary Mar, Alberta Minister of Intergovernmental Affairs, told the Richmond Chamber of Commerce in June 2006 that the TILMA dispute process is “everything Canadian business asked for”.
- Massively deregulates. The agreement says in Article 3 that there shall be “No Obstacles” that would impair or restrict “trade through the territory of the Parties, or investment or labour mobility between the Parties” and that “Parties shall not establish new standards or regulations that operate to restrict or impair trade, investment or labour mobility.” There are some limited exceptions allowed for in the agreement, such as water, but these are to be reviewed annually to reduce their scope.
All government regulation will be affected because any regulation could be seen as in some way restricting investment. And even if a regulation fits with one of the objectives TILMA accepts as being legitimate, it can still be successfully challenged if it is not the least restrictive way to achieve the objective.
- Recognizes only certain government objectives as legitimate. Among the objectives not recognized as legitimate are the preservation of agricultural land, the conservation of heritage sites, the maintenance of scenic views, or the promotion of small business, neighbourhood or rural development.
Some examples of regulations that would be vulnerable to challenge on the grounds that they are not based on “legitimate objectives” and restrict investment are the Agricultural Land Reserve, municipal bans on billboards, municipal development restrictions to maintain the quality of neighbourhoods.
- Makes BC and Alberta regulations the same - forever. Aside from some limited exceptions, BC and Alberta will have to “mutually recognize or otherwise reconcile their existing standards and regulations”. All BC mining regulations, for example, will forever have to be as minimal as those of Alberta’s, regardless of changes in government. This binding obligation lessens the value of the right to vote in each province, as the government of one province would not be permitted to increase standards and regulations beyond what exists in the other province.
- Covers all government “entities” – Crown corporations, local governments, school boards, universities, private agencies on contract with the government - and subjects their policies to potential challenges. Although there is supposed to be a consultation process with these entities in a transition period until 2009, the agreement already requires that none of their measures is “amended or renewed in a manner that would decrease its consistency with this Agreement.” This means all local governments, for example, already cannot initiate anything that might violate the agreement.
- Eliminates political choice. TILMA commits all future BC and Alberta governments to automatically support expansion of trade agreements. It commits all future BC and Alberta governments to promote cross-border transfers of energy, including to the US.
- Will allow all purchasing decisions by provincial governments, local governments, Crown Corporations, school boards, and universities to be challenged and overturned for purchases costing as little as $10,000.
- Bans government support for rural development, small business, and economically depressed regions. Targets any agricultural support. Government assistance that "distorts investment decisions" is a violation of the agreement.
- Undermines the democratic process in each province by granting political rights to non-citizens. Each provincial government, as well as local governments in each province, will be obligated when they are doing anything that might be covered by TILMA to "provide the other Party [BC or Alberta] with an opportunity to comment on the measure, and take such comments into consideration."
In other words, the governments of BC and Alberta have created greater rights for interests outside of their provinces to intervene in the legislative process than they have guaranteed for voters in their own provinces. This is especially ironic given the lack of consultation British Columbians and Albertans were afforded in the creation of TILMA.
- Is being promoted on a false basis. Alberta and BC politicians are selling the agreement on the claim that supposedly show "billions" could be saved by eliminating so-called inter-provincial trade barriers. These claims have been repeatedly debunked by economists. Real barriers to inter-provincial trade are minimal. The claims about inter-provincial barriers are really an attack on government's right to regulate.
A Summary of Its Impacts by Ellen Gould
“Within the TILMA are the seeds of a true economic union, an erasing of the provincial
boundary for all purposes except voting and the color of the license plate.” Todd Hirsch, Canada West Foundation, July 15, 2006
If the Campbell government was going to erase the border with Alberta, shouldn't it have had a consultation with the province's citizens first? The “Trade, Investment, and Labour Mobility Agreement” (TILMA) was signed by Alberta and BC in April 2006. It is posted on the Internet at tinyurl.com/krqrb [please note: this opens an interesting but large .pdf file]. With no public consultation process, Campbell and Klein signed this agreement that (among other things):
- Allows private individuals to sue and get up to $5 million compensation for regulations, policies, and programs that “impair or restrict” investment, trade, or labour mobility. Alberta and BC will also be able to sue each other for any violation of the agreement. A three person dispute panel will have the power to make legally binding decisions that will compel these governments to change their policies, no matter how popular these policies are.
- Is a major step towards "deep integration" with the US. Complaints about differences in provincial regulations are made repeatedly by the US Trade Representative. At the most recent Pacific Northwest Economic Region conference, representatives of north western US states and BC and Alberta committed to explore the possibility of "expanding the B.C.-Alberta Trade, Investment and Labour Mobility Agreement (TILMA) /concept/ throughout the PNWER region."
- Goes far beyond NAFTA in enabling commercial interests to sue for regulations they don’t like. NAFTA allows private investors to sue under NAFTA’s Chapter 11, but TILMA allows these suits over “any matter regarding the interpretation or application of this Agreement.” While TILMA restricts compensation to $5 million, private interests could all line up to get compensated once one complaint has been successful. This will force governments to change their policies. Alberta’s Minister of International and Intergovernmental Relations, Gary Mar, Alberta Minister of Intergovernmental Affairs, told the Richmond Chamber of Commerce in June 2006 that the TILMA dispute process is “everything Canadian business asked for”.
- Massively deregulates. The agreement says in Article 3 that there shall be “No Obstacles” that would impair or restrict “trade through the territory of the Parties, or investment or labour mobility between the Parties” and that “Parties shall not establish new standards or regulations that operate to restrict or impair trade, investment or labour mobility.” There are some limited exceptions allowed for in the agreement, such as water, but these are to be reviewed annually to reduce their scope.
All government regulation will be affected because any regulation could be seen as in some way restricting investment. And even if a regulation fits with one of the objectives TILMA accepts as being legitimate, it can still be successfully challenged if it is not the least restrictive way to achieve the objective.
- Recognizes only certain government objectives as legitimate. Among the objectives not recognized as legitimate are the preservation of agricultural land, the conservation of heritage sites, the maintenance of scenic views, or the promotion of small business, neighbourhood or rural development.
Some examples of regulations that would be vulnerable to challenge on the grounds that they are not based on “legitimate objectives” and restrict investment are the Agricultural Land Reserve, municipal bans on billboards, municipal development restrictions to maintain the quality of neighbourhoods.
- Makes BC and Alberta regulations the same - forever. Aside from some limited exceptions, BC and Alberta will have to “mutually recognize or otherwise reconcile their existing standards and regulations”. All BC mining regulations, for example, will forever have to be as minimal as those of Alberta’s, regardless of changes in government. This binding obligation lessens the value of the right to vote in each province, as the government of one province would not be permitted to increase standards and regulations beyond what exists in the other province.
- Covers all government “entities” – Crown corporations, local governments, school boards, universities, private agencies on contract with the government - and subjects their policies to potential challenges. Although there is supposed to be a consultation process with these entities in a transition period until 2009, the agreement already requires that none of their measures is “amended or renewed in a manner that would decrease its consistency with this Agreement.” This means all local governments, for example, already cannot initiate anything that might violate the agreement.
- Eliminates political choice. TILMA commits all future BC and Alberta governments to automatically support expansion of trade agreements. It commits all future BC and Alberta governments to promote cross-border transfers of energy, including to the US.
- Will allow all purchasing decisions by provincial governments, local governments, Crown Corporations, school boards, and universities to be challenged and overturned for purchases costing as little as $10,000.
- Bans government support for rural development, small business, and economically depressed regions. Targets any agricultural support. Government assistance that "distorts investment decisions" is a violation of the agreement.
- Undermines the democratic process in each province by granting political rights to non-citizens. Each provincial government, as well as local governments in each province, will be obligated when they are doing anything that might be covered by TILMA to "provide the other Party [BC or Alberta] with an opportunity to comment on the measure, and take such comments into consideration."
In other words, the governments of BC and Alberta have created greater rights for interests outside of their provinces to intervene in the legislative process than they have guaranteed for voters in their own provinces. This is especially ironic given the lack of consultation British Columbians and Albertans were afforded in the creation of TILMA.
- Is being promoted on a false basis. Alberta and BC politicians are selling the agreement on the claim that supposedly show "billions" could be saved by eliminating so-called inter-provincial trade barriers. These claims have been repeatedly debunked by economists. Real barriers to inter-provincial trade are minimal. The claims about inter-provincial barriers are really an attack on government's right to regulate.
