Canadian Content Rules Do Not Violate Trade Agreements, CAW says

November 6, 2008, 2:00 PM EST


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Government concerns that Canadian content requirements for publicly funded purchases violate international trade law are entirely misplaced, CAW National President Ken Lewenza says.

Lewenza made the comments today at a press conference where the union released a comprehensive legal opinion that shows governments have the ability to implement Buy Canadian policies at the municipal, provincial and federal levels.

"For too long we've heard government officials claim they had no authority to enact Buy Canadian legislation as it violated the terms and conditions of our international trade obligations," said Lewenza. "We've now proven this to be completely false and put this debate to rest."

The legal opinion, authored by international trade expert Steven Shrybman of Sack Goldblatt Mitchell LLP, indicates that municipal and provincial governments can specify levels of Canadian content for purchases and, where competition exists, restrict the tendering process entirely to goods that are made in Canada.

At the federal level, Shrybman points out that while certain limitations exist under trade agreements (including the NAFTA), these agreements do not govern direct government purchases that include urban rail, ship building, transportation services and those related to national defense.

International trade law also exempts government purchases funded through federal transfers to provinces, which means the federal government has the authority to attach 'Buy Canadian' conditions when it provides funding to other levels of government, Shrybman said.

The CAW, along with local labour councils throughout the country, have put forth a Buy Canadian-Build Communities resolution, which commits municipal councils to purchase goods with the highest amount of Canadian content, requiring a minimum of 50 per cent Canadian content for the purchase of public transit vehicles including final assembly in Canada, as well as an annual report to the municipal council on the amount of Canadian content in purchases.  Some municipalities have already passed resolutions to adopt Buy

Canadian policies for public purchases, including Woodstock, Thorold and Oshawa, Ontario.

"Canadians are facing one of the most severe economic downturns in history and a major crisis in the manufacturing sector," said Lewenza.  "It's time our elected officials stop hiding behind the veil of trade agreements to justify their inaction when it comes to protecting Canadian jobs through government purchases."

The CAW has sent letters to the Prime Minister and all Premiers encouraging them to read the legal opinion and to adopt Canadian content requirements for publicly funded purchases.

Certain provinces have adopted Buy Canadian purchasing policies in recent years, including the government of Quebec, which enacted a policy requiring 60 per cent Canadian content in public transit vehicles purchased with provincial funds.

In 2007, a combined total of $544 billion was spent by municipal, provincial and federal governments in Canada.

Lewenza was joined at the press conference by Shrybman as well as Canadian Labour Congress Secretary-Treasurer Hassan Yussuff and Toronto and York Region Labour Council President John Cartwright.

Click here to access the legal opinion and other campaign material.

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