PROVINCIAL IMPLEMENTATION OF THE UNITED STATES-CANADA FREE-TRADE AGREEMENT Article 103 of the recently concluded United States-Canada Free 1/ Trade Agreement states that the parties "shall ensure that all necessary measures are taken in order to give effect to its provisions, including their observance, except as otherwise provided in this Agreement, by state provincial and local governments. Opponents of the proposed pact in the 2/ governments of the three provinces that have refused to endorse it contend that the Federal Government of Canada had no authority to make this pledge and any attempt by Ottawa to confer this authority upon itself through 3/ legislation would be unconstitutional. 4/ Ever since the Judicial Committee of the Privy Council delivered 5/ its decision in the 1937 dispute known as the Labour Relations case, it has been settled that the Parliament of Canada does not have the same virtually unfettered power to enact legislation to implement the provisions 6/ of a treaty that the Congress of the United States enjoys. Instead, under the rule fashioned in that case, the Parliament of Canada has only been competent to pass laws respecting matters it has jurisdiction over under 1/ United States-Canada Free-Trade Agreement 3 (unpublished, Jan. 2, 1988). (See enclosed photocopy). 2/ The provincial governments of Ontario, Manitoba, and Prince Edward Island have opposed the United States-Canada Free-Trade Agreement. 3/ Daily Report for Executives, No. 241, at L-1 (Dec. 17, 1987). 4/ Appeals to the Privy Council were abolished in Canada in 1949. Supreme Court Act, R.S.C. ch. S-19, § 54 (1970). 5/ Attorney-General for Canada v. Attorney-General for Ontario, 1937 A.C. 326 (Ont.). the Canadian Constitution, regardless of whether the purposes of those 8/ laws is to implement a foreign or a domestic policy decision. Since the exclusive legislative powers of Canada's ten provinces are generally significantly broader than are those of the individual states in this country, the inability of the Federal Government of Canada to implement the provisions of a treaty that concern subjects constitutionally assigned to the provinces can seriously hamper an Administration's efforts to direct Canada's foreign policies. However, through negotiations, the Federal Government has traditionally been successful in obtaining the concurrence of the provincial governments before it has entered into international agreements that have required provincial 9/ implementation. In response to the objections that have been voiced in Canada to the inclusion of article 103 in the Free-Trade Agreement, the Administration has repeatedly stated that it is studying its legal 10/ position. The clear message of these statements is that if all of the provinces do not promptly agree to do their part in implementing any Free-Trade Agreement approved by Parliament, the Federal Government will consider asking the Supreme Court to overturn the Labour Conventions 1/ Constitution Act, 30 & 31 Vict., ch. 3. 8/ P. Hogg, Constitutional Law of Canada, 249-254 (1985). 9/ Id. at 253-254. case or to rule that its present constitutional powers are broad enough to give it jurisdiction to unilaterally implement all of the provisions of the Free-Trade Agreement. Neither of these contentions would be tenuous. Canada's leading expert on constitutional law has called the 11/ Labor Conventions case a "poorly reasoned decision" and the Federal Government could reasonably be said to derive the authority to implement the Free-Trade Agreement from its general power to legislate for the 12/ "peace, order, and good government of Canada.' Nevertheless, the Supreme Court has traditionally been a strong defender of provincial powers and it would probably be very reluctant to upset the constitutional balance struck by the Privy Council in 1937. In negotiating the Free-Trade Agreement, the Government of Canada consulted with the governments of the individual provinces and tried to keep its pledges respecting matters that are governed within Canada by provincial laws and policies to a minimum. Towards this end, the Federal Government was generally very successful in ensuring that the Agreement would not require the provinces to tailor their future laws to meet its provisions or to change their existing laws 13/ to bring them into conformity with the Agreement. In fact, the only chapter of the Free-Trade Pact that clearly requires provincial 11/ Supra note 8, at 253. 12/ Constitution Act, 30 & 31 Vict., ch. 3, § 91. 13/ See United States-Canada Free-Trade Agreement, articles 601.2, implementation is the one devoted to trade in wine and distilled spirits. Other provincial laws and policies are bound to eventually be challenged as being contrary to the Agreement. Perhaps the most likely candidates in this regard are provincial laws and policies respecting government procurement contracts and future laws and polices respecting licensing in the services sector. To date, however, lists of provincial laws that will have to be amended or repealed as a consequence of the proposed United States-Canada Free-Trade Agreement have not been produced. 14/ Prepared by Stephen F. Clarke Senior Legal Specialist American-British Law Division Law Library, Library of Congress Thank you for your letter of January 4, 1988, requesting a copy of the memorandum prepared by our Office of General Counsel on legal issues raised by the U.S.-Canadian Free Trade Agreement. A copy of the memorandum is enclosed. As indicated on the cover page of the memorandum, the memorandum was prepared by and reflects the views of our Office of General Counsel. Neither the memorandum, its contents, nor its conclusions have been adopted by the Commission. The memorandum is not intended to serve as a statement by the Commission on these issues. If we can be of further assistance, please do not hesitate to call upon us. |