FARMERS’ RESOLUTION TO EXEMPT WATER FROM THE NAFTA

Whether you love the NAFTA or you hate the NAFTA, WATER should NOT be INCLUDED in the NAFTA…

Following is a list of NAFTA articles that compromise Canadian sovereignty over our water resources and the proposed amendments that would fix the problem.

#1  Trade agreements apply to “goods”, “services”, “investments”

NAFTA Article 102 “eliminate barriers to trade in, and facilitate the cross border movement of, goods and services between the territories of the Parties, to increase substantially investment opportunities in the territories of the Parties, and to…expand and enhance…”.

#2  Goods are defined by the Harmonized Commodity Coding System”:

NAFTA Article 201: Goods of a party are products as these are understood in the General Agreement on Tariffs and Trade (classifies goods for customs tariff and other purposes.

…any good covered by a GATT tariff heading is subject to all the provisions of the Agreements themselves unless explicitly excluded (e.g. raw log exports, certain species of fish from the Maritimes…)

#3  Harmonized Commodity Coding System of the GATT:

22.01 Waters, including natural or artificial mineral waters and aerated waters, not containing added sugar or other sweetening matter not flavoured; ice and snow.

   22.01.10 Mineral waters and aerated waters

10 Natural mineral water

  90 Other

22.01.90 Other

#4  GATT HCCS Explanatory Notes - Geneva, 1986

Heading 22.01: This heading…covers ordinary natural water of all kinds (other than sea water). Such water remains in this heading whether or not it is clarified or purified.

#5  NAFTA (301): National Treatment

Each party shall accord national treatment to the goods of another Party Country “A” must accord the citizens of Country ”B"” treatment identical to the treatment it provides to its own nationals…

#6  NAFTA Article 314 (Export Taxes)

No party may adopt or maintain any duty, tax or other charge on the export of any good to the territory of another party unless such duty, tax or charge is adopted or maintained on any such good when destined for domestic consumption.

#7  NAFTA Article 309 (Import/Export Restrictions)
No party may adopt or maintain any prohibition or restriction on the exportation or sale for export of any good destined for the territory of another party, except in accordance with Article XI of the GATT:

GATT Article XI: Export prohibitions or restrictions temporarily applied to prevent or relieve critical shortages of foodstuffs or other products essential to the exporting contracting party… (would not allow restriction of water exports to meet future needs nor on the basis of environmental concerns);

#8  NAFTA Article 315 (Other Export Measures)

Any quantitative restriction on exports as a result of a shortage of domestic supplies (GATT XI) must ensure that:

• Proportional sharing (based on past average use).
• No price discrimination
• Does not disrupt normal channels of supply
  

#9  NAFTA Annex 702.1 (Agriculture)

• Incorporates FTA Article 711 (defines “agricultural goods” by way of a list of tariff item numbers, including “Tariff Item 22.01”)
• States that “the definitions of the terms specified in Article 711 of the Canada -US Free Trade Agreement shall apply …”
• In case of any inconsistency, this section shall prevail

#10  NAFTA Chapter Eleven (Investments)

NAFTA Article 1102: Each Party shall accord to investors of another party treatment no less favourable than it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation and sale or other disposition of investments.

#11  NAFTA Chapter Twelve (Services)

NAFTA Article 1202: Each Party shall accord service providers of another Party treatment no less favourable than it accords, in like circumstances, to service providers of any other Party or of a non-Party.

IMPLICATIONS

• Right to share in irrigation project

• Rights of US-based users

• e.g. water-flooding in the oil patch
• e.g. industry
  
• e.g. hydro-electricity generation

• Rights of upstream users (if US-based)

• Rights to export

SOLUTION

The FARMERS’ RESOLUTION would list water (HCCS Tariff Item 22.01) as one of the exempted items in:

Annex 301.3 Section A - Canadian Measures

Canada’s list of specific goods that are exempt from Article 301 (National Treatment) and 309 (Export Restrictions) of the goods sections of the NAFTA (includes “export of logs of all species” and “unprocessed fish” from the Maritimes.)

The FARMERS’ RESOLUTION would list water (HCCS Tariff Item 22.01) as one of the exempted items in:

Annex II Schedule of Canada …sets out pursuant to Articles 1108(3) Investment and 1206(3) Cross Border Trade in Services, the reservations taken by that Party with respect to specific sectors, sub-sectors or activities for which it may maintain existing or adopt new or more restrictive, measures that do not conform with obligations imposed by... [the Investment and Trade in Services provisions, including National Treatment]