“Coal is dead.”

These are not the words of a Greenpeace activist or left-wing politician, but of Jim Barry, the global head of the infrastructure investment group at Blackrock — the world’s largest asset manager. Barry made this statement in 2017, but the writing has been on the wall for longer than that.

Banks know it, which is why they are increasingly unwilling to underwrite new coal mines and power plants. Unions and coal workers know it, which is why they are demanding a just transition and new employment opportunities in the clean economy. Even large diversified mining companies are getting out of the business of coal.

The only ones who seem to have remained in denial are President Donald Trump and non-diversified mining companies like Westmoreland Coal. The Denver-based firm made a bad bet in 2013 when it purchased five coal mines in Alberta. Now it wants Canadian taxpayers to pay for its mistake.

Alberta’s coal phaseout

Three years ago, Alberta’s New Democratic Party (NDP) committed to what some have described as “the most ambitious climate plan in North America to date.” In addition to the development of an economy-wide carbon price, the province is phasing out coal-fired power by 2030. Without the infrastructure to export coal, the climate plan has also resulted in a de facto phaseout of local thermal coal mining.

To ensure support for the plan, major utility companies in the province were provided with “transition payments” to facilitate the switch to gas and renewable energy. Westmoreland did not receive a government handout, because coal mining companies have no role to play in the energy transition. The company, which filed for bankruptcy protection for its investments in the United States in October, doesn’t think this is fair.

NAFTA’s investment chapter

Because Westmoreland is an American company, it can rely on the North American Free Trade Agreement (NAFTA) for protection from “unfair” treatment. NAFTA allows a foreign investor to use a process known as “Investor-State Dispute Settlement” (ISDS) when government action harms its business in some way.

ISDS allows foreign investors to bypass local courts and bring claims for monetary compensation to an international tribunal. The system is not unique to NAFTA; it is found in other trade agreements like the Comprehensive and Progressive Agreement for Trans Pacific Partnership (CPTPP) and thousands of bilateral investment treaties (known as Foreign Investment Promotion and Protection Agreements in Canada).

ISDS is hugely controversial. Concerns have been raised by a wide range of actors about both the process of ISDS, and the way the system can infringe on the sovereign right of states to regulate to protect public health, human rights and the environment.

More than 900 ISDS cases have been launched by investors since the early 1990s, including 27 against Canada that have so far cost Canadian taxpayers at least $315 million. There is one ongoing dispute that concerns a ban on gas fracking in Québec, but the Westmoreland claim is the first brought in relation to a policy explicitly designed to combat climate change.

Westmoreland argues that part of the reason it invested in Canada in 2013 was to diversify its holdings in response to regulatory risk. At the time, the Obama Administration was taking action under the Clean Power Plan to reduce the reliance of American utilities on coal.

The company’s failure to anticipate similar regulatory action by its northern neighbour is remarkable.

Life after coal

A key battleground

If governments respond appropriately to the urgent warning issued by the Intergovernmental Panel on Climate Change (IPCC) in October, efforts to phase out fossil fuels will have to ramp up considerably — and quickly. We should expect the industry to fight these efforts through a variety of means. ISDS may become a key battleground.

The U.S.-Mexico-Canada Agreement (USMCA or CUSMA, depending on who is talking about it), which may replace NAFTA (it has been signed, but has not been ratified), does not retain the process of ISDS between Canada and the U.S.

While this is good news in the long run, some have suggested that there will be a “rush of filings” before access to ISDS for already established investors expires (three years after USMCA comes into force). Canada will also be exposed to claims from investors under other agreements such as the CPTPP and Canada-European Union Comprehensive Economic and Trade Agreement (CETA).

Other countries, particularly poorer nations, face an even higher risk of ISDS claims and have far less resources available to fight them. It is notable that big oil companies have retained some access to ISDS against Mexico in USMCA, after lobbying hard for it.

A climate of fear?

If Westmoreland’s case proceeds to arbitration, it will not have direct implications for Alberta’s climate policy. An investment tribunal cannot require the provincial government to reverse the coal phaseout; it can only award the company damages. Westmoreland is asking for US$470 million. It is the federal government, rather than Alberta, that would have to pay compensation to Westmoreland if the company’s claim was successful. However, Ontario did agree to pay the award in a recent NAFTA case.

What is more concerning than any potential payout is that Westmoreland’s suit could hinder efforts to implement similar plans to combat climate change in other jurisdictions.

“Regulatory chill” is a phenomenon that has been observed in several jurisdictions around the world. A notable example is the decision of the New Zealand government to delay the introduction of legislation to require plain packaging of tobacco products until Australia won its ISDS case against the tobacco company Philip Morris International. This delay of regulatory action — out of fear of expensive litigation — may have cost lives.

As recent forest fires and floods have demonstrated, delays in action to combat climate change can also be deadly.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

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All hell is breaking loose over the Trans Mountain pipeline.

On Sunday, Kinder Morgan announced it was putting all “non-essential spending” on hold until it could be guaranteed “clarity on the path forward.” That sent both the Alberta and federal governments into a near-frenzy — Premier Rachel Notley pledged to buy the entire pipeline if needed, while the federal cabinet held an “emergency meeting” (ministers literally ran from the media afterward).

It’s also come to light that Kinder Morgan could actually sue the government of Canada if it can’t build the pipeline. In a call with investors, Kinder Morgan chair and CEO Steven Kean said that it’s far too premature to consider.

But it certainly wouldn’t be unusual: between 1995 and 2015, Canada has been sued 35 times by investors and paid out at least $170 million.

“It is extraordinarily easy for a deep-pocketed company like Kinder Morgan to sue Canada using NAFTA,” said Gus Van Harten, an associate professor at York University’s Osgoode Hall Law School and expert in international investment law and arbitration, in an interview with DeSmog Canada.

So what would this look like in practice? And would Kinder Morgan have a serious shot at winning? DeSmog Canada took a look at the details.

How on earth would Kinder Morgan actually sue Canada?

It would happen via the Chapter 11 provision of the North American Free Trade Agreement (NAFTA), which was signed by Canada, the United States and Mexico in 1994.

Here’s how Global Affairs Canada describes the process: “It establishes a framework of rules and disciplines that provides investors from NAFTA countries with a predictable, rules-based investment climate, as well as dispute settlement procedures which are designed to provide timely recourse to an impartial tribunal.”

It also happens to be the most notorious part of NAFTA.

The concept itself is referred to as an “investment-state dispute settlement.”  Basically, if an investor — aka a large corporation — thinks that a government has acted in a way that’s unfair and disadvantaged their ability to make profits by introducing a new policy, it can sue the government for alleged losses.

This ability is baked into many international trade agreements: for example, Canadian mining company Gabriel Resources is currently suing Romania for $4.4 billion because the government denied it permits to construct a large and environmentally destructive mine. U.S. company Bilcon is currently suing Canada for rejecting a quarry in an endangered whale nursery.

In the case of NAFTA, an investor has to be based in a different country than the one it’s suing for damages. So even though Trans Mountain ULC is technically the owner of the pipeline, it would be the Texas-based Kinder Morgan Inc. that would launch the challenge.

How Kinder Morgan Could Sue Canada In a Secretive NAFTA Tribunal https://t.co/vjgsRS4PJp #kindermorgan #cdnpoli #bcpoli pic.twitter.com/LgDjq1wjlu

— DeSmog Canada (@DeSmogCanada) April 11, 2018

Is there another motive at play here?

Well, the most obvious thing would be the potential for a large sum of money. For instance, in 2016 TransCanada filed a lawsuit against the U.S. for a whopping $15 billion over the blocked Keystone XL pipeline (the challenge was withdrawn following the election of President Donald Trump and subsequent approval of the project).

But it can also be used as a tool to pressure governments to back down on policies.

“In the present case, a NAFTA claim would allow Kinder Morgan to team up with Alberta and perhaps the federal government too to pressure British Columbia politically,” Van Harten said.

It sounds a bit bonkers, hey? The federal government effectively using a lawsuit against itself to pressure a province to reduce its opposition to a project that it legitimately believes may have calamitous impacts on Indigenous rights and the environment?! Well, it’s worked before.

According to Van Harten, one of the earliest NAFTA cases was against Canada and led to a “humiliating settlement by the federal government.” In 1997, Canada moved to ban a gasoline additive that contained a neurotoxin. The retailer of that additive in Canada then sued the government for $250 million USD. In the end, the government rescinded the ban, apologized, issued a statement saying the toxin wasn’t toxic and then paid the company $13 million USD.

The company didn’t receive the amount of money it was pursuing. In a sense, it received far more than money because of the unique powers that NAFTA provides companies to pressure governments to back down on policies or avoid implementing such policies in the first place.

But why would Kinder Morgan sue the federal government, which supports the project?

It’s the only government that it could actually sue.

NAFTA was signed by the three countries, not provinces or territories. So even if a conflict is between an investor and sub-national government, the lawsuit is still filed against Canada, Mexico or the United States.

Van Harten described the set-up as the “result of bad negotiating decisions in the past by the federal government, advised by federal trade officials who in my experience are often hawkishly pro-investor. For 20 years, Canada has been and still remains the only Western country that allows these aggressive international claims by U.S. multinationals against the country’s sovereign and democratic choices. Thus, our exposure to these claims lies primarily with officials in Ottawa, not B.C. or the other provinces sometimes targeted under these trade agreements.”

We’ve seen this pan out recently with the lawsuit by Lone Pine Resources against the federal government for $118.9 million in alleged damages following Quebec’s decision to revoke oil and gas exploration licences beneath the St. Lawrence River. It’s fundamentally a conflict with Quebec, but has to be dealt with by Canada.

Oh, the joys of federalism.

So who actually decides this stuff? Is there a NAFTA court?

Kind of. It’s actually more of a secretive tribunal.

There are three arbitrators on the tribunal. There are no public records available for most of the decision-making process. It’s up to the tribunal to decide if the challenge is legitimate and, if so, how much the government should pay in damages. Asides from the country directly involved, the tribunal doesn’t allow standing for other stakeholders who may be impacted by the decision.

Keep in mind there’s no equivalent process in place for governments to sue investors that damage local environments or economies.

These challenges can take a long time to resolve. The aforementioned Lone Pine lawsuit against Canada was first launched in 2013 and is still ongoing. It also costs a lot of money for both sides. As a result, it might make more sense to view a potential Kinder Morgan challenge as a means of forcing B.C. to back down and prevent it from considering future standoffs that would impede profits.

Where does this leave B.C.?

Wait and see.

There’s no guarantee that Kinder Morgan will pursue this option. The company has issued the specific date of May 31 as the deadline for the standoff to be resolved, after which it may walk away from the project. At that point, it’s conceivable that it could launch a challenge against the federal government.

“I would advise people in B.C. not to be bullied in this way and to stick to the position that they think is principled and fair,” Van Harten said. “B.C. has a right to enforce its provincial laws and regulations, in a situation of overlapping constitutional jurisdiction and regulatory responsibility, as Kinder Morgan should have known from the start.

“If Canada is sued because of B.C.’s own decisions to protect its environment and economy, the fault lies with the federal government that negotiated and concluded NAFTA, subjecting Canada to these claims by U.S. companies where no other Western country had done then or has done since.”

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When a Canadian federal-provincial environmental review panel ruled in 2007 that a proposed quarry would go against community core values and would threaten right whales and other marine life in the Bay of Fundy, groups that had fought against the project believed that was the end of the story.

But, that is not how the system works under the North American Free Trade Agreement (NAFTA), which has dispute settlement provisions allowing corporations to sue governments for compensation when they feel the local environmental approvals process has interfered with expected profits.

Instead of abandoning efforts to build a quarry and marine terminal on Digby Neck, Delaware-based Bilcon headed for the NAFTA Investor-State Dispute Settlement tribunal and, in 2015, the three-person panel ruled two-to-one that the environmental assessment panel had violated Canadian law by using the criterion of core community values.

Bilcon has claimed $300-$500 million in damages.

Bilcon project included shipping path in endangered whale nursery

The Bilcon NAFTA ruling was inexplicable to Nova Scotia residents as the company planned to blast within 50 metres of the Bay of Fundy and build a 600 foot pier with nearly 50 45,000 tonne vessels a year carrying quarried basalt to the U.S. through waters that serves as a nursery for severely endangered right whales.

ICYMI: 3% of the World’s Endangered Right Whales Died This Summer, Mostly in Canada’s Unprotected Waters

This week, the federal government and environmental organizations are in federal court arguing the NAFTA arbitration panel overstepped its bounds and, with NAFTA renegotiations underway, the case is being watched closely.

Ecojustice, working with Sierra Club Canada Foundation and East Coast Environmental Law, is arguing that Bilcon had the opportunity to ask a Canadian court to rule on the alleged breach of federal law, but, instead, went through NAFTA, which is supposed to decide only on questions of NAFTA law, meaning the tribunal stepped outside its legal expertise.

“If this decision stands it will send a chilling message that even when the Canadian government makes good decisions to protect our environment, there’s a chance that a NAFTA tribunal could swoop in, decide our environmental laws are unfair and force Canada to cough up hundreds of millions of dollars — leaving Canadian taxpayers on the hook,” Ecojustice said in a news release.

“We can’t let that happen.”

A local battle to protect a community and its environment “has turned into a broader fight to ensure international trade agreements do not supersede Canada’s environmental laws,” the release said.

The Bilcon case is under the legal microscope, but it is not the only case where Canada has been financially dinged after losing a NAFTA investor-state dispute.

The company is seeking $300 to $500 million in damages. https://t.co/8O8bRjNi4s

— DeSmog Canada (@DeSmogCanada) January 30, 2018

Canada dinged $220 million in NAFTA losses, faces half a billion more

A report by the Canadian Centre for Policy Alternatives found that, as of January 1, 2018, Canada has paid out nearly $220 million in NAFTA losses and settlements — all to U.S. investors.

Those claims often targeted legitimate, non-discriminatory environmental protection, public health and resource management decisions made by Canadian governments, according to the report.

Canada currently faces eight claims with investors demanding about half a billion dollars, including Omnitrax’s claim relating to its broken rail line to Churchill, Manitoba and Lone Pine’s challenge to Quebec’s fracking moratorium, the report found.

In addition, the federal government has spent more than $95 million in legal fees defending the ballooning number of investor-state lawsuits.

The information was compiled by CCPA senior research fellow Scott Sinclair, through access to information requests, and Sinclair would like to see the federal government grasping the opportunity to remove the process from NAFTA — something suggested by the U.S.  

But, instead, Canada’s position is to retain the dispute process as it helps Canadian resource companies investing in developing countries.

Canada is the most-sued country under NAFTA’s Chapter 11 which gives companies the right to sue governments.

Since 2010, Canada has been sued twice as many times as Mexico and the U.S. combined, which is a worrying trend, Sinclair said.

“The Trudeau government has more than enough reasons to remove the undemocratic investor-state dispute settlement process from NAFTA during the current renegotiations, as proposed recently by the U.S. administration,” he said in a news release.

Canada could gain leverage by withdrawing its opposition to allowing countries to opt out of the process, Sinclair said.

“This could help negotiators advance other key Canadian interests, such as safeguarding affordable access to medicines or securing meaningful continental labour standards.”

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There’s no telling if the 220 square-kilometres of unlined tailings ponds in the Alberta oilsands are leaking contaminated waste into nearby water sources, according to the government of Canada.

That claim was made in an official response to NAFTA’s Commission for Environmental Cooperation despite strong scientific evidence suggesting a clear linkage between the oilsands’ 1.3 trillion litres of fluid tailings and the contamination of local waterways.

The response comes after a June 2017 submission by two environmental organizations and a Dene man alleging the federal government was failing to enforce a section of the Fisheries Act that prohibits the release of a “deleterious substance” into fish-frequented waters.

The NAFTA commission has 120 working days to determine whether the case has merit in light of Canada’s latest claims.

While Ottawa acknowledged in its response that nearby waters had a higher-than-average rate of contamination, it maintained that proving its source is “scientifically and technically challenging as methods for their analysis have not been available.”

ICYMI: What You Need to Know About NAFTA’s Investigation into Oilsands Tailings Leaks

Creating a sense doubt about the facts is a “flimsy” defence, Dale Marshall, national program manager with Environmental Defence, one of the environmental organizations bringing the case, told DeSmog Canada.

“The evidence is pretty strong that these are coming from tailings.”

Multiple Studies Conducted by Federal Scientists Detect Tailings Leakage

Many studies have indeed been done to assess the impacts of tailings waste on nearby waters.

An internal memo delivered to then-natural resources minister Joe Oliver and obtained in 2013 by investigative reporter Mike De Souza shows that federal scientists had discovered a clear presence of tailings toxins in local water sources.

The memo described that “the studies have, for the first time, detected potentially harmful, mining-related organic acid contaminants in the groundwater outside a long-established out-of-pit tailings pond.”

These findings weren’t the first.

A 2008 study commissioned by Environmental Defence pegged the number of tailings leakage at 11 million litres a day, potentially reaching 72 million litres per day by 2012.

Then, in 2010, a journal article co-authored by limnologist David Schindler pointed to “tailings pond leakage or discharge as sources” of toxic pollutants in the Athabasca River. That was confirmed in 2014, again by federal scientists, with an entry in the journal Environmental Science and Technology that identified a “chemical fingerprint” distinct from natural rates.

“They found also not only are those tailings ponds leaking, but it looks like it is flowing pretty much from those tailings ponds, through the ground and into the Athabasca River,” oilsands advisory committee member and environmental scientist Bill Donahue told the CBC in an interview.

ICYMI: No Sure Plans, Funding for $51 Billion Cleanup and Rehabilitation of Oilsands Tailings Ponds

Marshall added oilsands companies documents have also indicated that tailings ponds leak and estimate the leakage expected to occur over time.

This has resulted in growing concerns in nearby Indigenous communities, including Fort Chipewyan where anomalous cancer rates have plagued the small community. But a lack of meaningful research has meant the community has been left without answers or recourse.

“The fact of the matter is that there are increasing levels of contaminants,” Melody Lepine, member of Mikisew Cree First Nation and co-chair of the Oil Sands Advisory Group, told DeSmog Canada. “They’re very dangerous.

“My community downstream has significant concerns about their health, the health of the ecosystem, impacts to birds and wildlife,” she added.

“It’s troubling to know after 50 years there’s still not enough data and research and management of tailings ponds.”

‘Precautionary Principle’ Means Government Must Act in Absence of Definite Proof

Environment and Climate Change Canada is committed to applying the “precautionary principle.”

As described by the federal department, that means that “where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation.”

Those concerned about tailings leakage say the issue appears to be a perfect example of when that principle ought to be applied.

“Let’s just say the evidence is not as strong as it is,” Marshall said. “Even then — and I would call the contamination of Alberta’s rivers and increased cancer rates in downstream Indigenous communities serious environmental issues — the government’s stated principle is it’s not going to let uncertainty prevent them for acting to address those serious concerns.”

But the federal government has not taken that approach.

In 2013, Environment and Climate Change Canada decided there wasn’t enough evidence to prove violations of the “pollution prevention provisions” of the Fisheries Act and eliminated the on-site inspections of seven tailings ponds.

While inspectors still respond to specific complaints, they no longer proactively monitor the area for violations of the law.

In its recent response to NAFTA the government explained that “officers were not able to establish that a person deposited or permitted the deposit of a deleterious substance” due to an unavailability of scientific tools.

Canada Tells #NAFTA Leaky #Oilsands Tailings Ponds a ‘Challenge’ to Prove, Despite Existing Federal Study https://t.co/Qc1ewGdAGp #ableg #cdnpoli #cdnsci @envirodefence @NRDC

— DeSmog Canada (@DeSmogCanada) November 17, 2017

Federal Government Ultimately Responsible for Violation of Federal Laws

Canada told the NAFTA environment committee the government is managing the tailings ponds in “a manner consistent with its domestic laws” and that it was justified in reallocating investigators to other issues deemed to have “a greater impact on the environment.

The federal submission claimed, “Canada’s enforcement actions are effective.”

The federal Liberal government pledged in its 2015 election platform to “treat our freshwater as a precious resource that deserves protection and careful stewardship.”

Lepine, who was raised in Fort Chipewyan, one of the communities most affected by oilsands developments, said she is disappointed the position of government on the tailings issue hasn’t changed — despite a change in leadership at both the provincial and federal levels.

ICYMI: Alberta Approves Suncor Tailings Plan Despite Reliance on ‘Unproven Technology’

“I was optimistic we had these changes in government,” Lepine said. “But really, nothing has changed since both of them have taken office. I’m not convinced they take this issue very seriously.”

Behind the scenes, a jurisdictional tug-of-war is at play, Lepine said. “They’re pointing fingers at each other.”

Yet enforcement of the Fisheries Act is ultimately the responsibility of the federal government.

If the province isn’t regulating in a way that prevents violations of federal laws, then it’s the responsibility of Ottawa to intervene, Marshall said.

“Yes, there are agreements made between the federal government and provinces. But that doesn’t mean the federal government can just wash its hand of it,” he said.

“[The federal government] is still the last stop between environmental degradation and the violation of federal laws.”

Environmental Tribunal Has 120 Days to Decide Next Steps

NAFTA’s Commission for Environmental Cooperation has 120 working days to review Canada’s submission and the merits of the original case.

Following that, the commission has 60 working days to schedule a vote between the environment ministers of Canada, the U.S. and Mexico.

If two-thirds of the countries vote to advance the case, a “factual record” of the issue will be prepared. A factual record has no binding legal consequences and would simply serve as a “name and shame” document on the public record.

Lepine said in the past Canada has taken action in response to international scrutiny.

On Wednesday, the International Union for Conservation of Nature declared the Wood Buffalo National Park — located just north of the oilsands — as one of the most threatened World Heritage Sites in North America.

“We wouldn’t have to do all these things if we thought Canada and Alberta were taking our concerns seriously,” Lepine said. “I’m hopefully that through this international forum they get that extra push. But we’ll see.”

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For years environmental organizations have called on the federal government to do something about the leakage of  billions of litres of toxic chemicals from Alberta’s oilsands tailings ponds into the Athabasca River every year.

And for years they’ve been ignored — until now.

NAFTA’s Commission for Environmental Cooperation (CEC) is reviewing a submission by Environmental Defence, the Natural Resources Defense Council and Daniel T’seleie. Now, Canada must provide a response to the arguments made in the submission.

Here’s a primer on why this process matters.

So what’s going on with leaky tailings ponds?

Tailings ponds now cover more than 220 square kilometres of previously boreal forest around Fort McMurray, Alberta.

It’s been suspected for ages that these ponds have been seeping chemicals into nearby water systems — chemicals such as benzene, ammonia, cyanide and arsenic.

In 2013, investigative reporter Mike De Souza revealed via an access to information request that then-natural resource minister Joe Oliver had received a memo citing studies that “detected potentially harmful, mining-related organic acid contaminants in the groundwater outside a long-established out-of-pit tailings pond.”

Only a year later, another federal study confirmed that toxic chemicals were reaching the Athabasca River.

In their submission to the Commission for Environmental Cooperation the three parties cite documented cases of contaminated tailings waste reaching (or projected to reach) waters in Jackpine Creek (from Shell), Beaver Creek (from Syncrude), McLean Creek (from Suncor) and the Athabasca River (from Suncor).

Such toxins can have calamitous effects on fish populations, which many local Indigenous peoples rely on for sustenance.

What’s the specific claim being made by the submission?

That Canada has failed to enforce subsection 36(3) of the federal Fisheries Act.

Specifically, that subsection reads (take a deep breath) that: “no person shall deposit or permit the deposit of a deleterious substance of any type in water frequented by fish or in any place under any conditions where the deleterious substance or any other deleterious substance that results from the deposit of the deleterious substance may enter any such water.”

The case that’s being made is that ignoring leaking tailings waste is violating that subsection.

Interestingly, the submission notes that case law has emphasized that the water itself does not need to be made “deleterious” to fish, with the question being whether or not the substance itself is a “deleterious substance.” It might sound like a silly debate, but it could make or break a case.

“It’s pretty clear there’s been a lack of enforcement action both by Alberta and the Canadian government, which is outlined in our complaint to the CEC,” Tim Gray, executive director of Environmental Defence, told DeSmog Canada.

“We felt this was a way of compelling the Canadian government to respond to someone, and this would shine the light of day on this issue with how the Canadian response comes back.”

What You Need to Know About NAFTA’s Investigation into #Oilsands Tailings Leaks https://t.co/StUCzhybGO #environment #NAFTA #cdnpoli pic.twitter.com/XyHSb2LsLT

— DeSmog Canada (@DeSmogCanada) August 23, 2017

Alright, so how does NAFTA have anything to do with this? Isn’t it a trade deal?

Indeed, it is: introduced in 1994, NAFTA was a groundbreaking regional trade agreement between Canada, the U.S. and Mexico.

It was also very controversial.

Aaron Cosbey, senior associate at the International Institute for Sustainable Development and expert on environmental issues pertaining to international trade, said in an interview with DeSmog Canada that there was a great deal of opposition to the deal at the time of signing, especially from the environmental community.

Much of the concern related to the expectation that a lot of low-wage work would be relocated to Mexico, with laxer environmental laws and regulations.

“Canadian NGOs were making the same argument: you can’t put in place this free trade agreement, which pits us against a country where the environmental law is not enforced,” Cosbey said.

“It’s not free trade if you do that.”

In response, the North American Agreement on Environmental Cooperation was created as a separate treaty, signed at the same time as NAFTA. One of its key roles has been to serve as a tribunal of sorts for submitted infractions of environmental laws, with the worst “punishment” being the issuing of a non-binding “factual report” which serves as a “name and shame” document.

“It has no legal force beyond bringing a little welcome sunshine to the dark corners of non-enforcement,” Cosbey said.

In short, it was designed as a way for the three countries to have a common mechanism in place to file complaints about environmental practices. The submission about tailings leakage was the very first step in this process. The determination that the submission met the criteria for review on August 16 was the next. Now, Canada has to respond to the allegations.

So does this mean that Canada will be reprimanded?

Nope.

All that’s happened at this point is that the secretariat acknowledged the submission is valid. Canada has until Sept. 28 to officially respond, although it could request a 30-day extension for “exceptional circumstances.” The secretariat then figures out whether or not to proceed with the “factual record.” It can either decide that it’s satisfied with the response and won’t proceed further, or recommend the preparation of the “factual record.”

But here’s the thing.

In order for the factual record to actually be prepared, the environment ministers of the three countries have to agree by a two-thirds majority to it. In other words, two of the three NAFTA environment ministers have to say “yes,” otherwise it won’t proceed further.

That’s a very real possibility. Cosbey said there have been at least five instances in the past decade in which the secretariat recommended the preparation of the factual record, and the council of environment ministers shot it down. In total, there have been 30 submissions made in the last 10 years, with only three resulting in the creation of a factual record.

In fact, almost this exact same submission was shot down at the council level, despite a recommendation from staff at the Commission for Environmental Cooperation.

Canada’s initial argument against it was that there was an ongoing court case (which would mean that a factual report couldn’t have been completed). As it turned out, the court case wasn’t proceeding at the time. At the time, CBC reported that assistant deputy minister for Environment Canada, Dan McDougall, then declared that the commission had no jurisdiction to investigate domestic law, which appears to contradict the entire point of the commission.

McDougall still works as assistant deputy minister for Environment and Climate Change Canada.

What are the chances that Canada will fight this?

It’s impossible to say.

The country does have a long track record of opposing the process, with Canada blocking two other investigations in 2014 with Mexico’s support.

But we’re now living under what Cosbey described as a “supposedly now-environmentally friendly Liberal government.”

As noted by Gray, the federal government is embarking on a series of modernization processes, including of the Canadian Environmental Assessment Act, Fisheries Act, Navigable Waters Act and National Energy Board.

“This is a clear example of where the tarsands industry has been violating the existing legislation, even in its poor form,” Gray said. “I would expect that once it becomes clear that the facts around this case are not really able to be argued with that they would take some action.”

It will be a big deal whether the submission gets quashed or allowed. After all, the council has never refused to make the factual record public, meaning that we would be given a fascinating window into the argument made by Canada for or against acting on tailings leakage.

Gray said the factual record would help embarrass the government for inaction and encourage them to actually comply with their own legislation. Furthermore, it could be used in a legal case against the government if it refuses to act.

The Trudeau government has already indicated on multiple files it’s willing to break its promises. So we’ll have to wait and see. Plus, the re-negotiation of NAFTA itself will provide an additional window into their thought process.

What about the re-negotiation of NAFTA?

Well, the three countries don’t exactly like what they created with the Commission for Environmental Cooperation. It’s effectively embarrassing and inconvenient to them.

That’s why Cosbey would “bet a lot of money” that the ongoing re-negotiation of NAFTA will involve shutting down the Commission for Environmental Cooperation, terminating the North American Agreement on Environmental Cooperation and putting all provisions within NAFTA itself.

“I can guarantee you we’re not going to see anything as strong as this,” he said. “Guaranteed. We’re taking steps backwards here.”

And as you might have gathered, the current system isn’t even particularly strong. Compare it to, say, the framework in the European Union, which results in binding directives from the European Court of Justice to fall in line with the rules.

Recent regional trade agreements like CETA and TPP have involved “token nods” to the system that NAFTA currently uses, but are much weaker provisions in practice.

So this may be one of the last opportunities that a concerned individual or organization has the chance to challenge the country in this manner.

“It’s possible,” Gray concluded. “I don’t know if anyone knows the timelines of the NAFTA renegotiations. But I’m hopeful the Canadian government would be looking to improve environmental protections, not erode them.”

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In April and May alone, Lone Pine Resources Inc. — the oil and gas company that’s currently suing the government of Canada for $118.9 million in alleged damages — lobbied 11 MPs, a policy advisor for the Prime Minister’s Office and the chief of staff for Natural Resources Canada.

The sole subject matter listed for the lobbying efforts was: “Claim against the Government of Canada under the North American Free Trade Agreement (NAFTA) by Lone Pine Resources Inc.”

The company is actively claiming damages for Quebec's 2011 decision to revoke oil and gas exploration licenses located beneath the St. Lawrence River that were granted to its subsidiary, Lone Pine Resources Canada Ltd., via a “farmout agreement” with Junex Inc. The $118.9 figure represents Lone Pine’s estimated sunk costs and lost future profits.

Actual case proceedings haven’t started yet: the last publically available document — a 251 page rebuttal by the Canadian government written entirely in French — is from July 2015.

These recent meetings could mean the company — which Sujata Dey, trade campaigner with the Council of Canadians, dubs “a Canadian company suing Canada through their U.S. tax haven and subsidiary” — is attempting to seek an out-of-court settlement with the government, an option that would allow Lone Pine to avoid mounting legal fees and the unpredictable nature of investment tribunals.

Investor-State Dispute Settlements Can Result In Large Payout, Rollback In Policies

Ben Beachy, senior policy advisor in the U.S. Sierra Club’s Responsible Trade Program, notes some settlements such as the Ethyl Corporation’s successful suit against Canada in the late ‘90s have resulted in weakened policy.

Even if that doesn’t occur, he says such investor-state dispute settlement procedures can create a “chilling effect” on governments: with the looming threat of lawsuits from foreign companies, officials are less likely to implement strong environmental protections.

Beachy said the threat of legal action is concrete: “It clearly is a consideration on the mind of policymakers: ‘Am I going to get sued in front of not a domestic court but three private lawyers whose rulings are unpredictable for millions or billions of dollars?’”

Lone Pine Suing Canada Over Quebec's Fracking Ban, Aggressively Lobbying in Ottawa https://t.co/YlkUqSMPTD @ccpa #NAFTA #cdnpoli

— DeSmog Canada (@DeSmogCanada) May 25, 2016

Canada Argues Claims By Lone Pine Are ‘Highly Exaggerated’

Lone Pine Resources is suing the government via the infamous Chapter 11 of NAFTA for what it describes as the “arbitrary, capricious, and illegal revocation” to frack under the St. Lawrence River “without due process, without compensation, and with no cognizable public purpose.”

The government of Canada has contended: “The measure was enacted by a fundamental democratic institution of Quebec and was preceded by numerous studies that establish that the Act seeks to achieve an important public policy objective, namely, the protection of the St. Lawrence River” and that “the damages claimed by the claimant are highly exaggerated.”

Investment Tribunals Lack Safeguards and Equal Standing, Says Investment Law Expert

Gus Van Harten, associate professor at York University’s Osgoode Hall Law School and expert in international investment law and arbitration, emphasizes that investor-state dispute settlement procedures don’t constitute an actual judicial process, lacking the usual safeguards of independence that judges have in domestic and international courts, or the ensuring of standing for all affected parties.

“It’s obvious that there are some foreign investors — not a lot — that benefit from it,” he says. “What’s usually claimed is ‘we’ll get more foreign investment and that will help the economy’ but there’s a real lack of evidence on that point.”

Over 70 Per Cent of NAFTA Claims In Past Decade Have Targeted Canada

Canada is the most sued country in the “developed” world.

A report published by the Canadian Centre for Policy Alternatives in January 2015 noted that via NAFTA, the government has been sued 35 times since 1994, losing seven cases and paying out over $170 million in damages.

Over 70 per cent of NAFTA claims since 2005 have involved Canada. Two-thirds of the total suits have been related to environmental or resource management policy.

Over 70% of #NAFTA Claims In Past Decade Have Targeted Canada https://t.co/YlkUqSMPTD @TheEnergyMix #oilandgas #fracking #cdnpoli

— DeSmog Canada (@DeSmogCanada) May 25, 2016

Nine foreign investors are currently suing Canada via NAFTA.

Beachy — who wrote and researched the Sierra Club’s recent report “Climate Roadblocks: Looming Trade Deals Threaten Efforts to Keep Fossil Fuels in the Ground” — notes that 2015 featured the largest number of investor-state dispute settlement cases launched globally, double the number from just five years before.

In 2014, half of new cases globally were challenging policies related to oil and gas extraction, mining or power generation.

Investor Suits May Increase In Number With Implementation of New Trade Deals

Beachy describes the Lone Pine case as being similar in significance to TransCanada’s $15-billion suit against the United States for blocking its proposed Keystone XL pipeline as both “serve as a wake-up call that deals like the Trans-Pacific Partnership would undermine our efforts to keep fossil fuels in the ground.”

Dey notes the ratification and implementation of the Trans-Pacific Partnership would add nine countries to the list in which companies could incorporate or set up legal vehicles in and sue Canada via investor protection clauses.

Beachy adds there are investors currently fracking in a dozen states that would gain new rights to sue the United States via proposed trade deals like the Trans-Pacific Partnership and Transatlantic Trade and Investment Partnership.

“This one is clearly not hypothetical because of Lone Pine,” Beachy says. “We are anxiously looking at the Lone Pine case given that more and more states in the United States are trying to do what Quebec and New York have already done to protect their citizens from the dangers of fracking.

“It’s a really ironic time to be handing more power to fossil fuel companies, just after the world committed to curb greenhouse gas emissions and transition to green energy in Paris,” he says.

Lone Pine Filed Notice of Arbitration Three Weeks Before Announcing Its Restructuring

Lone Pine Resources has had a rough few years. In December 2012, Moody’s Investors Service downgraded Lone Pine’s “corporate family rating” to Caa1 due to “strained liquidity and sharply declining production and reserves.”

Two-and-a-half months later, the company fired its CEO and CFO.

By January 2014, it completed financial restructuring and emerged from creditor protection, a process started in September 2013 (less than three weeks after it filed its notice of arbitration to the government).

In the process, it cut long-term debt obligations by over four times and rescinded its position as a publically traded company in Canada and the United States. As a result, it’s impossible to tell what Lone Pine’s net earnings are looking like these days and the potential significance of a $118.9 million settlement for the company.

Regardless of the outcome, Dey contends it’s a deeply troublesome example of what’s wrong with investor-state dispute settlement: “This is completely undemocratic,” she says. “It takes power from elected people and puts them into a supranational system that gives rights to corporations. It has nothing to do with democracy.”

“This is a corporate rights system that is even higher in position that our own democratically elected governments.”

Image: Mysterious foamy water collected after heavy rainfall near a fracking site. Joshua B. Pribanic/Public Herald.

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This is a guest post by David Suzuki.

In 1997, Canada restricted import and transfer of the gasoline additive MMT because it was a suspected neurotoxin that had already been banned in Europe. Ethyl Corp., the U.S. multinational that supplied the chemical, sued the government for $350 million under the North American Free Trade Agreement and won! Canada was forced to repeal the ban, apologize to the company and pay an out-of-court settlement of US$13 million.

The free trade agreement between Canada, the U.S. and Mexico was never designed to raise labour and environmental standards to the highest level. In fact, NAFTA and other trade agreements Canada has signed — including the recent Foreign Investment Promotion and Protection Agreement with China — often take labour standards to the lowest denominator while increasing environmental risk. The agreements are more about facilitating corporate flexibility and profit than creating good working conditions and protecting the air, water, land and diverse ecosystems that keep us alive and healthy.

Canada’s environment appears to be taking the brunt of NAFTA-enabled corporate attacks. And when NAFTA environmental-protection provisions do kick in, the government often rejects them.

According to a study by the Canadian Centre for Policy Alternatives, more than 70 per cent of NAFTA claims since 2005 have been against Canada, with nine active cases totalling $6 billion outstanding. These challenge “a wide range of government measures that allegedly interfere with the expected profitability of foreign investments,” including the Quebec government’s moratorium on hydraulic fracturing, or fracking.

Quebec imposed the moratorium in 2011 pending an environmental review of the controversial gas-and-oil drilling practice. A U.S. company headquartered in Calgary, Lone Pine Resources Inc., is suing the federal government under NAFTA for $250 million. A preliminary assessment by Quebec’s Bureau d’audiences publiques sur l’environnement found fracking would have “major impacts,” including air and water pollution, acrid odours and increased traffic and noise. Fracking can also cause seismic activity.

According to the CCPA, Canada has been sued more often than any other developed nation through investor-state dispute settlement mechanisms in trade agreements. Under NAFTA, “Canada has already lost or settled six claims, paid out damages totaling over $170 million and incurred tens of millions more in legal costs. Mexico has lost five cases and paid damages of US$204 million. The U.S. has never lost a NAFTA investor-state case.”

NAFTA does, however, have a watchdog arm that’s supposed to address environmental disputes and public concerns, the Commission for Environmental Cooperation. But Canada is blocking the commission from investigating the impacts of tailings ponds at the Alberta oilsands.

Environmental Defence, the Natural Resources Defense Council and three people downstream from the oilsands asked the CEC to investigate whether tailings leaking into the Athabasca River and other waterways represent a violation of the federal Fisheries Act. According to the complaint, the tailings ponds, which are actually much larger than what most people would think of as ponds, are spilling millions of litres of toxic liquid every day. Environmental Defence says the CEC found “plenty of evidence that tar sands companies were breaking Canadian law and lots of evidence that the Canadian government was failing to do anything about it.”

It’s the third time in the past year that Canada has prevented the commission from examining environmental issues. Canada earlier blocked an investigation into the protection of polar bears from threats including climate change and one concerning the dangers posed to wild salmon from B.C. fish farms.

Trade agreements are negotiated in the best interests of corporations instead of citizens. On top of that, federal and provincial governments keep pinning our economic hopes on volatile oil and gas markets, with little thought about how those resources could provide long-term prosperity. Recent plummeting oil prices show where that leads.

These priorities are screwed up. We end up with a boom-and-bust economy and the erosion of social programs as budgets are slashed when oil prices drop. Skewed trade deals allow corporations to override environmental protections that haven’t already been gutted, and create a labour climate in which wages, benefits and working standards fall.

It’s time for Canada to recognize that a diversified economy and citizens’ right to live in a healthy environment are more important than facilitating short-term profits for foreign and multinational corporations.

Written with contributions from David Suzuki Foundation Senior Editor Ian Hanington.

Learn more at www.davidsuzuki.org.

Image Credit: Prime Minister Stephen Harper Photo Gallery

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This is a guest post by Michael Harris, author of Party of One: Stephen Harper and Canada's Radical Makeover. It originally appeared on iPolitics. 

In politics, as in baseball, the rule is simple: Three strikes and you’re out.

When Stephen Harper finally shambles towards the showers, head down, bat in hand, I’ll be thinking of Mighty Casey. For much of his career, Harper has umpired his own at-bats. But that role will soon — if briefly — fall to the people of Canada. Election Day is coming to Mudville.

Strike one against this government of oligarchs and corporate shills comes down to this: They have greedily championed oil and gas while doing nothing to protect air and water. Consider the piece of legislation with the Orwellian name — the Navigable Waters Protection Act. NDP house leader Nathan Cullen said it as well as anyone could:

“It means the removal of almost every lake and river we know from the Navigable Waters Protection Act. From one day to the next, we went from 2.5 million protected lakes and rivers in Canada to 159 lakes and rivers protected.”

On second thought, Green Party Leader Elizabeth May put it pretty well too: “In Bill C-38, Stephen Harper cancelled and gutted environmental laws brought in by Brian Mulroney. He’s now moved on to destroy environmental law brought in by Sir John A. MacDonald.”

And who gave the Conservatives the blueprint for gutting the Navigable Waters Protection Act? The pipeline industry. The new legislation gave them a big plum: Along with power lines, pipelines were removed from the legislation altogether.

After eight years in office, Harper’s promise to regulate the energy sector remains as empty as the look behind his eyes. There’s a reason the Green Party just enjoyed the best fundraising year in its short history. May, like most Canadians, sees the big picture: All Stephen Harper has done in office is play shortstop to big business.

Canada now has more corrupt companies on the World Bank’s blacklist than any other country in the world. A stunning 115 of those companies are comprised of disgraced engineering giant SNC-Lavalin and its subsidiaries — the same company that the Harper government supported with an $800 million loan guarantee to build the dubious Muskrat Falls power development in Newfoundland and Labrador.

Big business keeps telling workers they can’t have defined benefit pensions. Yet 43 per cent of Canadian CEOs have reserved that option for themselves. The PM has nothing to say about the gulf between worker and CEO pay packets.

The Conservatives have ignored the great issue of the age — the environment — and have offered instead a robber-baron vision of Canada built on unsustainable development and inflated oil prices. The lion’s share of the benefits have gone to foreign corporations and speculators.

Albertans get a tenth of what Norwegians get from the sale of their non-renewables. Since the public owns those resources, this amounts to a form of theft.

The Harper government has sabotaged international efforts to set a bolder course on global warming. How badly has he betrayed the environment? We’re talking Benedict Arnold here: He has transformed Environment Canada into just another oilpatch stooge, violating the purpose for which it was created.

And for the third time in a year, the Harper government is trying to stop an investigation into Canada’s environmental record. Although there is evidence that chemicals from toxic tailings ponds created by the tar sands are seeping into adjacent groundwater in Alberta, the Harper government is trying to terminate a proposed NAFTA probe into the environmental effects of tailings ponds. Poison leaching into the ground — and Harper doesn’t want a factual record.

Of course he doesn’t. He didn’t want a factual record on endangered polar bears or salmon farm pollution. And remember, this is the guy who didn’t mind selling asbestos to other countries when it was being treated as a deadly carcinogen here in Canada.

Strike two against Stephen Harper is his personal failure to give Canadians a more open, ethical and democratic government. That is, after all, what got him elected in 2006 (that and a little cheating during the campaign). So it was beyond hypocritical this past week for the PM to portray himself as a champion of democracy and free speech after the dreadful killings in Paris. He even politicizes tragedy.

Here is the real man … the one who dedicated his entire communications effort to smothering free speech, who undermined access to information, the life-blood of any democracy, with endless delays in handing over government documents that belong to us. In some cases, his government has simply — and unconstitutionally — refused to fork them over. He has also mused about charging $200 per access request — which would certainly suppress the urge to ask.

The real man has muzzled his own workers — even demanding loyalty oaths from them. He wanted the right to ask prospective government employees about their politics. He has viciously attacked any individual or institution that opposes him, from former parliamentary budget officer Kevin Page to the Chief Justice of the Supreme Court of Canada.

The real man repeatedly has tried to turn the Internet into a servant of the police state, disguising his intent with nonsense about child pornographers and “protection.”

The real man has starved the opposition of even the most basic information about the budget and deprived Parliament of the ability to debate legislation through the cynical use of enormous omnibus bills.

Sheila Fraser has named the disease. Laws are being passed in Stephen Harper’s Canada without scrutiny. (That didn’t seem to bother the dear host of CBC’s The Current when she interviewed on my new book. But it bothers me, and a lot of other people, a great deal.)

The real man doesn’t speak to his fellow premiers as a group, banishes journalists from public buildings and thinks Sun News is where it’s at.

It didn’t take a genius to work out that Harper’s reaction to the robocall scandal would be new legislation that will make it harder to catch cheaters the next time. And trust me, there will be a next time. So let it be said clearly: Stephen Harper is a champion of screwing free speech and democracy at every opportunity.

What’s strike three? Canada is not Harperland. Stephen Harper is not who we are.

Canadians don’t want to see medicare slowly reduced to a ghost of its former self by a prime minister who once headed an organization created to destroy it.

Despite the stunning selfishness of some of its stars, Canadians don’t want to see the CBC brought to its knees and “restructured” by a man who prefers public relations to journalism.

Finally, Canadians don’t want to save money on the backs of veterans who didn’t take to the closet in the face of clear and present danger — especially when Harper has so egregiously used the military for political gain. There has to be more for our soldiers than bullets and beans.

Stephen Harper will definitely come out swinging when he comes to the plate. He will drag out the usual mantra to continue his reign of error — that only Steve can protect us from terrorists, only Steve can protect us from recession, and only Steve has the stuff of leadership.

I don’t think it’s working this time. I suspect that when Mighty Steve strikes out, there will be joy in Mudville.

Michael Harris is a writer, journalist, and documentary filmmaker. He was awarded a Doctor of Laws for his “unceasing pursuit of justice for the less fortunate among us.” His eight books include Justice Denied, Unholy Orders, Rare ambition, Lament for an Ocean, and Con Game. His work has sparked four commissions of inquiry, and three of his books have been made into movies. His new book on the Harper majority government, Party of One, recently hit number one on Maclean’s magazine’s top ten list for Canadian non-fiction.

The Narwhal’s reporters are telling environment stories you won’t read about anywhere else. Stay in the loop by signing up for our free weekly dose of independent journalism.

In today's January 15, 2015 episode DeSmogCAST host Farron Cousins joins DeSmoggers Carol Linnitt, Kyla Mandel, and Mike Gaworecki to discuss Canada's efforts to prevent a NAFTA-led investigation into the management of Alberta's oilsands tailings ponds.

We also discuss a clause in the UK's new Infrastructure Bill that mandates efforts to "maximize economic recovery of UK petroleum" and what that means for the nation's climate policy.

Lastly we discuss recent developments in the denier/skeptics debate and a recent open letter to media, calling on journalists to reserve the favourable term 'skeptic' for those engaged in truly scientific critical investigation.

To read more about these topics, check out these stories covered in today's episode:

Canada’s Fight Against NAFTA Investigation of Oilsands Tailings Get Political, Wins Allies

Calls For Media To Accurately Label Climate Deniers Growing Louder

Duty to Maximise Oil and Gas a ‘Dangerous Addition’ to the Infrastructure Bill

New Infrastructure Bill Puts UK Climate Ambition at Risk

DeSmogCAST is a weekly online show that features DeSmog writers, experts and guests covering breaking news and in-depth analysis on politics, energy and environment issues in the U.S., Canada and around the world.

The Narwhal’s reporters are telling environment stories you won’t read about anywhere else. Stay in the loop by signing up for our free weekly dose of independent journalism.

The U.S. and Mexico appear to have joined Canada in its fight to prevent a North American Free Trade Agreement (NAFTA) investigation of the more than 176 square kilometres of tailings ponds holding waste from the Alberta oilsands near Fort McMurray.

In 2010 a group of citizens and environmental groups petitioned NAFTA’s Commission on Environmental Cooperation to investigate whether Canada is breaking its own federal laws, in particular the Fisheries Act, by failing to adequately manage the massive tailings ponds which hold a toxic mixture of water, silt and chemicals.

“It was important for us to know whether this was happening and whether environmental laws were being broken and whether the government is upholding those laws or ignoring them,” Dale Marshall from Environmental Defence, one of the organizations behind the compliant, said.

A 2012 federal study confirmed the tailings ponds are seeping waste into the local environment and Athabasca River. In 2013 an internal memo prepared for then Natural Resources Minister Joe Oliver confirmed groundwater toxins related to bitumen extraction and processing are migrating from the tailings ponds.

“The studies have, for the first time, detected potentially harmful, mining-related organic acid contaminants in groundwater outside a long-established out-of-pit tailings pond,” the memo reads. “This finding is consistent with publicly available technical reports of seepage (both projected in theory, and detected in practice).”

A separate Environment Canada study released in late 2014 confirmed tailings ponds emit toxins into the atmosphere at rates nearly five times higher than previously reported.

The NAFTA environmental commission was established in 1994 to investigate public concerns and resolve environmental disputes related to international trade in Canada, the U.S. and Mexico.

A decision on whether or not to investigate complaints is made by a council comprised of environmental ministers from the three countries. A vote on whether or not to recommend a ‘factual record’ or in-depth investigation is expected to come down within the next week.

Yet in an email to the CBC Environment Canada spokesman Danny Kingsberry said “through a council resolution in December 2014, Canada, Mexico and the U.S. unanimously voted to terminate the submission.”

The statement raised concerns that Canada has already guaranteed success in its protracted fight against the investigation even though the official vote has yet to take place. U.S. and Canadians officials described the statement as “highly unusual” although Canada’s effort to shut down the investigation has been explicit throughout the process.

Previously Dan McDougall, the assistant deputy minister for Environment Canada’s international affairs branch, instructed the commission to “proceed no further with this submission.” McDougall argued a related pending court case ruled out the need for an investigation. When the commission pushed back, McDougall instructed the body to “cease this analysis.”

According to Hugh Benevides, legal officer for the commission, Canada’s efforts to thwart the investigation are unprecedented.

“To my knowledge we have never received such a firm position as we have from Canada as we have in this case,” he told the CBC. “I think it’s safe to say it’s a new approach.”

Canada has blocked previous NAFTA investigations, however, aided in part by Mexico’s vote. In 2014 Canada prevented two investigations, one into B.C. salmon farms and the other into the protection of polar bears.

According to Benevides the council has successfully stopped four investigations in the last 20 years. If Canada prevents an investigation of the oilsands it would bring the total to five, the majority of which will be led by Canada within the last three years.

Debra Steger, international trade law expert at the University of Ottawa, told the CBC that countries are eager to avoid this kind of oversight.

“[A NAFTA investigation] produces a report that can be critical of what the government is doing and no government wants that scrutiny,” she said

Steger added this is especially the case with such politically contentious issues as the Alberta oilsands.

“This is an issue that the three parties probably just don’t want to go too near at this point,” she said.

For Environmental Defence’s Marshall the blocked investigation has everything to do with the pending Keystone XL pipeline decision south of the border.

“It’s clear that President Obama is looking at Canada’s record when he is thinking about approving or not approving certain pipelines going through the U.S.,” he said. “If this is one more stain on Canada’s record then that plays into his decision potentially.”

A vote on the tailings pond investigation is expected as soon as Friday.

Image Credit: Tailings pond at Suncor mining site by Alex MacLean.

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Lawyers for West Coast Environmental Law (WCEL) sent an open letter to the NAFTA-affiliated Commission for Environmental Protection (CEC) Wednesday, claiming Canada is "in violation of its obligations under the North American Agreement on Environmental Cooperation."

WCEL is urging also Canadians to write to the CEC and "tell them loud and clear that the Canadian government's recent attacks on environmental laws are a subsidy to the oil and gas and other industries and, as a result, we have failed to live up to our international commitments."

The North American Agreement on Environmental Cooperation (NAAEC) is the environmental accord made parallel to the North American Free Trade Agreement (NAFTA) in 1994 between Canada, the United States and Mexico.

The NAAEC established the CEC "to support cooperation among the NAFTA partners to address environmental issues of continental concern, including the environmental challenges and opportunities presented by continent-wide free trade."

The open letter comes in response to an invitation for comment from the CEC, which is marking its 20th anniversary by conducting a public review of NAFTA and NAAEC to "determine their effectiveness in fostering environmental protection and improvement in North America," according to a release from West Coast Environmental Law. A Joint Public Advisory Committee is currently accepting comments from the public.

"The environmental side-agreement was meant to ensure that NAFTA did not result in an incentive to weaken environmental laws at the request of industry, and an environmental race to the bottom," says Andrew Gage, Staff Counsel, West Coast Environmental Law. Gage thinks the CEC's public review is an opportunity for "Canadians to tell the Commission that that's just what has happened in Canada in recent years."

West Coast Environmental Law is positing that amendments made to Canada's environmental laws by the Harper government in the 2012 omnibus budget bills C-38 and C-45 have led to a "weakening of environmental protections contrary to the NAFTA side-agreement."

"Bills C-38 and C-45 gutted environmental protection in Canada," says Gage. "Canada's only law for reducing greenhouse gases was repealed, thousands of environmental assessments were eliminated, and our legal protection of fish, lakes and rivers were significantly weakened. That's not improvement, it's a backward slide."

West Coast Environmental Law is asking Canadians to join them in writing to the CEC, to ensure that Canada does not become a "NAFTA pollution haven."

Image: West Coast Environmental Law

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