One of the nation’s investment treaty experts warns that Canada’s highly preferential trade agreement with China could have important implications for resource and LNG development in British Columbia and the rest of the country.
The controversial Canada-China Foreign Investment Promotion and Protection Agreement (FIPPA), which the Harper government signed into effect without parliamentary debate, “means that any B.C. government or legislature or courts would now be subject to obligations arranged by the federal government and China under the treaty,” says Osgoode Law School professor Gus Van Harten.
It also means that the FIPPA obligations can overrule the priorities and rights of First Nations in the province.
Van Harten offered two critical examples on how FIPPA could impact the province.
If the government of British Columbia decided to change the rules on hydraulic fracturing of shale gas to protect water or reduce methane leaks, those changes could be contested by Chinese investors as unfair and a violation of their expectations at the time they invested.
In addition, if the B.C. government stipulates that more British Columbians must be employed by the industry as opposed to foreign temporary workers, then Chinese investors could contest those changes too, also as an unfair change to the rules in place when they invested.
The government of B.C. has already signed an agreement with China that would allow the importation of cheap labour from the superpower to build LNG terminals.
How does FIPPA connect to that labour agreement? Van Harten wonders.