Dear editor,
There has been considerable comment recently about the Canada-China Foreign Investment Promotion and Protection Agreement that Canada negotiated with China.
Please note that this agreement is not a trade agreement but an agreement concerning investment. This treaty is designed to protect Canadian investors in China through stable, predictable rules and to protect them against discriminatory and arbitrary practices without diminishing Canadian governments’ ability to legislate for Canadian purposes.
The world sees Canada as a safe and profitable place to invest. Our abundant natural resources provide attractive business opportunity.
It is an opportune time to use this interest in Canada to negotiate fair access to markets and investment opportunities in other countries.
The Canadian system of laws and legal appeals provides fair treatment once a foreign entity has met the Investment Canada Act for both the “net benefit test” for acquisitions and for national
security concerns with respect to investment. Decisions by Canada under the Investment Canada Act are excluded from challenge under the agreement.
The main purpose of a Foreign Investment Promotion and Protection Agreement is to ensure Canadian investors in a foreign jurisdiction greater protection against discriminatory and wholly
arbitrary practices, provide adequate and prompt compensation in the event of an expropriation and enhance predictability of the policy framework affecting investors and their investments in the foreign jurisdiction.
The agreement also ensures that all investment disputes are resolved under international arbitration, ensuring that adjudications are independent and fair. Canadian investors in China
will no longer have to rely on the Chinese legal system to have their disputes resolved.
Ours is the first bilateral investment agreement that China has signed that expressly includes language on transparency of dispute settlement proceedings. It is Canada’s long-standing policy that all dispute resolutions should be open to the public and that the submissions made by the parties be available to the public.
Under the agreement, any decision emanating from dispute resolution would be made public.
What the agreement does NOT do is impair Canada’s ability to regulate and legislate in areas such as the environment, culture, safety, health and conservation. Furthermore, Canada’s ability to review foreign investments under the Investment Canada Act to ensure they provide a net benefit to Canadians and that our national security is not compromised is preserved.
It is important to note that, under this treaty, Chinese investors in Canada must obey all of the laws and regulations of Canada, just as any Canadian must.
In short, the Canada-China Foreign Investment Promotion and Protection Agreement is similar to the 24 investment treaties Canada has implemented with investment partners. We join
countries such as New Zealand, Germany, the Netherlands, Belgium and Japan, which have all signed investment treaties with China on terms that are similar to or in most cases less favourable than the terms we have negotiated with China.
Finally, in 2008, the Conservative government introduced the unprecedented process of putting Canadian international treaties to the scrutiny of the House of Commons. Every single
treaty is now tabled in the house for 21 days to give the opposition an opportunity to debate the treaty.
John Duncan
Editor’s note: John Duncan is the Conservative MP for Vancouver Island North.
