Vive Le Canada

SPP Regulatory framework [4 items] NACC Reports, CCPA More Than Jellybeans, CoC
Date: Wednesday, September 26 2007



A trilateral Council of business leaders representing the private
sectors of Canada, Mexico, and the United States today put forward
more than 50 concrete recommendations designed to strengthen North
American competitiveness in global markets while improving public
safety and security.

Standards and regulatory cooperation: In the area of standards and
regulatory cooperation, the report supports the intention of
governments to work toward a framework for trilateral regulatory
cooperation in 2007, an essential tool for ensuring the compatibility of new regulations while reducing unnecessary differences in existing rules and standards. The report also emphasizes the need for regulators and businesses alike to engage actively in the development of global technical standards. It makes recommendations for specific
actions in the short term in three sectors-food and agriculture,
financial services, and transportation-as well as for enhanced
cooperation in the protection of intellectual property rights.

[2] NACC Report to Ministers - addresses North American Regulatory
Cooperation Framework
Executive Summary Below

8. Sign a new North American Regulatory Cooperation Framework and
ensure consistent application of standards and regulatory
requirements within each country. This framework should be based on
the principle that both in drafting new regulations and in revising
existing rules, regulatory authorities in all three countries should
make every effort to reflect prevailing North American or
international standards. Upon signature of the framework,
a North American Regulatory Cooperation and Standards Committee
should be formed to survey the variety of standards and regulatory
differences by industry that impede trade. This committee will also
seek to reduce the identified differences or develop other mechanisms
to lessen their impact on the competitiveness of North American




For those recommendations included in the standards and regulatory
cooperation section, we are pleased that the three governments appear
to be close to completion on two of our short-term recommendations:
1) the conclusion of a voluntary trilateral Regulatory Cooperation
Framework and
2) the development of a trilateral Intellectual Property Rights
We put forward the Regulatory Cooperation Framework as an immediate
recommendation because it is a prerequisite to more effective action
across a host of sector-specific regulatory concerns. While we expect
that the governments will soon conclude their discussions and will
release this framework at the August meeting, we urge the Leaders to
ensure that it is both comprehensive in scope and meaningful in
Linked to regulatory cooperation and forming another essential
element in building a competitive North America is the proposed
Intellectual Property Rights strategy. Intellectual property issues
affect every aspect of the lives of our people and are prerequisites
for investments in research and innovation that are critical to the
future quality of life of communities across North America.
Each of the three governments has taken significant steps toward
enforcing IPR. However greater coordination is needed to address the
trans-border aspects of IPR enforcement, specifically through a
coordinated intellectual property rights strategy. We understand that
such a strategy will be released at the Leaders´ meeting, focusing
especially on ways to deter and detect trade
AUGUST 2007 10
in pirated and counterfeit goods, public awareness and outreach to
the business community, and measurements to assess progress in
specific sectors.
Once this strategy is in place, we hope that officials will agree on
an accelerated timetable to address the NACC recommendations in this
area, including especially steps to combat DVD piracy and consumer
goods counterfeiting, such as the development of a list of protected
titles; establishment of "fake-free zones" around theaters and malls;
licensing the importation of industrial-capacity DVD burners;
development of a digital piracy pilot project; improved strategic
enforcement; and establishment of model local anti-piracy programs.
Governments also are moving forward on several of our sectoral
o Food and agriculture. Agencies of the three governments have
together explored a common scientific underpinning to discuss
labeling and health claims in their countries. In terms of fortified
food regulations, Canada´s revised policy is expected to be published
in 2007.
o Financial services. Discussions between Canada and the United
States are nearing completion concerning our recommendation to
eliminate the withholding tax on cross-border interest payments. In
addition, financial regulators from the three countries will continue
to work closely within the SPP/NAFTA Financial Services Group to
enhance cooperation in financial regulation.
o Insurance. Early indications are that the Mexican government is
favorably disposed to our recommendations for increasing by 2010 the
percentage of assets that Mexico-based North American insurers are
allowed to invest overseas.
o Trucking. The United States has issued a proposed rule that would
allow Canadian trucks to enter the United States using Canadian
insurance and has called for public comment on the proposal.
o Electronic trading. While there is still no assessment of potential
outcomes, the G-7 finance Ministers group has undertaken the
AUGUST 2007 11
recommendation of enhancing cross-border transactions through direct
access to existing electronic trading platforms.
Finally, on the energy front, the initial feedback we have received


[4] More Than Jellybeans: The SPP Regulatory Framework Agreement and
Its Impact on Chemicals Regulation, by Bruce Campbell
Canadian Centre for Policy Alternatives

Contrary to assurances from Prime Minister Harper, an SPP regulatory
agreement signed at Montebello sets Canada on course toward a single
North American regime for regulating industrial chemicals that will
almost certainly weaken the existing Canadian regulatory system and
erode policy autonomy. This study, by CCPA Executive Director Bruce
Campbell, reveals that a sub-agreement on chemicals regulation was
signed at Montebello, but it was not publicized and it was not posted
on the Canadian government web site.

Canadian Centre for Policy Alternatives

Press Release

Hidden Montebello SPP agreement on industrial chemicals will weaken
Canadian regulation-report

September 24, 2007 | National Office | Topic(s): International trade
& investment, deep integration | Publication Type: Press Release

OTTAWA-Contrary to assurances from Prime Minister Harper, an SPP
regulatory agreement signed at Montebello sets Canada on course
toward a single North American regime for regulating industrial
chemicals that will almost certainly weaken the existing Canadian
regulatory system and erode policy autonomy, says a study released
today by the Canadian Centre for Policy Alternatives.

The study, by CCPA Executive Director Bruce Campbell, reveals that a
sub-agreement on chemicals regulation was signed at Montebello, but
it was not publicized and it was not posted on the Canadian
government web site.

The sub-agreement commits the three NAFTA countries to harmonizing
chemicals regulation in testing, research, information gathering,
assessment, and risk management, as much as possible, by 2012. It
also commits the three governments to work toward a single North
American voice in international standard-setting bodies, which, given
existing power realities, means an American voice.

The chemicals agreement follows the advice of the SPP business
council, which complained that tougher Canadian regulations were
preventing certain U.S. goods from being sold in Canada.

"Signing this SPP chemicals harmonization agreement is further
evidence that the Harper government is moving Canada deeper into the
business-friendly U.S. camp and away from the much stronger European
system, which takes a safety-first approach to regulation," says

"How much more risk to health, safety and the environment will
Canadians have to incur in the name of business competitiveness?"
Campbell concluded.


More Than Jellybeans: The SPP Regulatory Cooperation Agreement and
its Impact on Chemicals Regulation, is available on the CCPA web

For more information contact Kerri-Anne Finn, CCPA Communications
Officer, at 613-563-1341 x306.

Download the Report/Study:
More Than Jellybeans: The SPP Regulatory Framework Agreement and Its
Impact on Chemicals Regulation - PDF File, 133 Kb
Requires Adobe Acrobat Reader.

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[4] Citizen's Guide to the Security and Prosperity Partnership (SPP)
The SPP and public safety: How regulatory harmonization threatens our
health and the environment - download PDF version -
he first priority of the Security and Prosperity Partnership´s so-
called Prosperity Agenda is to "develop a trilateral Regulatory
Cooperation Framework by 2007." The goal is to eliminate differences
in Canadian, Mexican and U.S. standards on everything from food
safety and the environment to financial services, labour and
manufacturing. Proponents of this idea claim it will reduce the cost
of doing business in North America and increase the continent´s
competitiveness. In reality, eliminating country-specific standards
is simply a way to increase corporate profits by limiting what
governments can do to protect their citizens from corporate abuse. It
is about letting big businesses set their own rules and having the
public bear all the environmental and health risks of a deregulated

"Smart regulation" or deregulation?

On March 24, 2005, the day after North America´s leaders announced
the creation of the Security and Prosperity Partnership, Treasury
Board initiated a Smart Regulation Action Plan aimed at changing how
the government regulates the economy. In the words of former Treasury
Board president Reg Alcock, "Smart Regulation understands that we
cannot continue to do things as they have always been done; that in
today's world, regulation can-and must-become a competitive advantage
and a key instrument for achieving our social, environmental and
economic objectives." Historically, "how things have always been
done" was that government rules would make sure our food is safe and
properly labelled, and our air and water is clean. In other words,
regulation is about protecting the public from corporate abuse.

The "smart" regulation agenda, which was later incorporated into the
Cabinet Directive on Streamlining Regulation, reverses this
historical logic by:

* Entrenching trade and commerce promotion-as opposed to health
and safety protection-as the primary consideration before regulating;
* Committing to "seamless" provincial, territorial and federal
regulations with the likely outcome being the national adoption of
the weakest rules;
* Protecting the regulator from liability for bad decisions;
* Approving food, drugs and other products faster so they can get
to market;
* Increasing the onus on the regulator to prove the need for
regulations; and
* Relying on voluntary measures and industry-based performance
targets instead of enforceable standards.

"Smart regulation" and the SPP

The Cabinet Directive on Streamlining Regulation, which was completed
and released to the public on April 1, 2007, has more to do with
copying the U.S. regulatory process, which is much weaker than in
Canada, than with bringing Canada´s own process up to date. It is
about North American regulatory harmonization as described in the SPP
and in North American Competitiveness Council documents. In February
2007, the NACC recommended that, "an overarching principle" of a
North American Regulatory Cooperation Framework, "should be to
require agencies to take into consideration, as part of their cost-
benefit analysis, the trade effect of regulations that differ from
North American standards." In other words, regulators like Health
Canada, Environment Canada or the Pest Management Regulatory Agency
would have consider how the U.S. or any other government would feel
about stricter rules and regulations than exist in their countries.
Obviously businesses in the U.S. would be irritated by almost any
Canadian rule that was stricter than in the U.S. and pressure would
be incredible for Canada to lower its standards. In fact it is
already happening.
Nothing "smart" about pesticides and trans-fats

Part of the SPP agenda involves developing common North American
standards on how food is produced, how it is inspected, how it is
processed and how it is moved from one place to another. Current
differences in food standards have been labelled as "trade
irritants." So regulators in all three NAFTA countries are working to
eliminate them. A 2006 SPP report identified stricter pesticide
residue limits in Canada as a "barrier to trade." So Canada is
raising pesticide limits on hundreds of fruits and vegetables in an
effort to merge its policies with the United States. Using the same
logic, it becomes apparent that a highly popular ban on trans-fats in
Canada would never fly because it too would be a significant "trade
irritant" with the U.S. While common food safety standards developed
in the public interest might be a good idea, regulatory harmonization
as spelled out in the SPP clearly has nothing to do with our health
and safety.
Bush plans even more deregulation

Under the SPP, Canada is harmonizing its regulatory practices with a
U.S. government that is busily deregulating its entire economy. In
July 2007, a new executive order came into effect requiring all U.S.
departments to prove a "market failure" before any new rules or
regulations can be passed. Approval for regulations is to be
centralized in a new Regulatory Policy Office within the White House
and headed by a presidential appointee. "This can only further delay
implementing health, safety and environmental protections," Gary
Bass, executive director of OMB Watch, told the Associated Press at
the beginning of July. Like Canada´s "Smart Regulation" agenda, the
U.S. order also encourages corporations to set their own standards.
The SPP will force Canada to adopt whatever regulatory policy is set
in Washington.

Many regulations in Canada are set by the provinces, not by the
federal government, and can differ in small or large ways across the
country. That means that the federal government would have to first
eliminate these differences across Canada before moving ahead with
continental regulatory harmonization. As it turns out, a little-known
agreement between Alberta and British Columbia is quietly achieving
that goal. The Trade, Investment and Labour Mobility Agreement
(TILMA), which came into effect on April 1, 2007, requires that
Alberta and B.C. mutually recognize standards and regulations
affecting inter-provincial trade and investment. Regulations that are
stricter in one province than the other can be legally challenged as
an impediment to trade (i.e. profits). If a province refuses to lower
its regulations it faces penalties of up to $5 million - stiff enough
to discourage most new rules affecting the economy. But this is
precisely the point of TILMA-deregulation-and B.C. and Alberta´s
premiers, as well as the federal Conservatives, are currently trying
to get other provinces to sign on. This would pave the way for Canada-
U.S. regulatory harmonization as mandated in the SPP.
There are rules for a reason

Canada deserves a regulatory policy that puts our health and the
health of our environment first. The SPP will force Canada to
regulate the American way, which is to barely regulate at all and to
let corporations set and enforce their own rules. http://www.policyaltern... http://www.policyaltern... http://www.policyaltern... http://www.canadians.or...

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