Continuing with our review of trade agreements, this blog looks
at Canada's existing international trade agreements.
Canada has entered into a range of free trade agreements with
various countries. The most significant of these is the North
American Free Trade Agreement (NAFTA), which covers Canada's
largest trading partner the USA, as well as Mexico.
North American Free Trade Agreement
Chapter ten of NAFTA deals with procurement. NAFTA does not
apply directly to the provinces, although the federal government
may be in breach if a province acts contrary to the agreement.
NAFTA contains a number of exceptions, including measures:
to protect essential security interests
to protect public morals, order or safety
to protect human, animal or plant life or health
to protect intellectual property
relating to goods and services of handicapped persons,
philanthropic institutions and prison labour
There is also a list of specific items that are not covered by
the rules on procurement. Challenges to the federal government
under NAFTA must be brought to the CITT (see previous blogs).
Canada-US Agreement on Government Procurement
In addition to NAFTA, Canada and the USA entered into a separate
agreement on procurement following the introduction of "Buy
American" measures in the US. The impact of CUSAP is to open
provincial procurements to US suppliers. There were temporary
provisions that expired in 2011, but there are also long term
provisions allowing access for goods and services for procurements
over roughly $548,000 and for construction over roughly $7,700,000
(the amounts are based on a moving exchange rate).
Each province has agreed to CUSAP, but the range of government
bodies covered varies from province to province. There is also a
range of items that are excluded altogether and the usual
exemptions for security requirements.
Other International Trade Agreements
Canada has entered into a number of other trade agreements, some
of which have provisions specifically governing procurement. In
each case, the agreements only bind the federal government and not
the provinces. Each agreement is slightly different in terms of the
goods and services covered, thresholds and so on. Relevant
agreements include the Canada-Panama Free Trade Agreement, the
Canada-Peru Free Trade Agreement and the Canada-Chile Free Trade
The final blog in this series will consider the implications of
the upcoming Comprehensive Economic and Trade Agreement between
Canada and the European Union.
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While that agreement mandated export measures on Canadian softwood lumber exports destined for the United States, it also protected those lumber exports from the potential imposition of onerous import measures by the U.S.
On September 29, 2016, the Supreme Court of Canada issued its first tariff classification decision since Canada signed the International Convention on the Harmonized Commodity Description and Coding System in 1998.
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