| |
|||
|
|||
|
|
Français | |
Contact Us | |
Help | |
Search | |
Canada Site |
|
|
|
|
|
|
|
|
|
|
|
|
|
Home | |
Site Map | |
What's New | |
About Us | |
Registration |
|
 Agreement on Internal Trade
|
|||||||||||||
|
|
 Summary of the AgreementOn July 18, 1994, First Ministers signed the Agreement on Internal Trade (AIT) to eliminate barriers to trade, investment and mobility within Canada. The AIT came into force on July 1, 1995. The Agreement on Internal Trade is an evolutionary process that requires ongoing negotiations and adjustments in order to further liberalize trade throughout the Canadian economy. The Agreement on Internal Trade provides:
Index of the Internal Trade Agreement
General
Constitutional
Authorities
General Rules
Sectoral Chapters
Institutional Provisions and Dispute Resolution
Procedures
Other Provisions Internal Trade Representatives An overview of the key elements of the Agreement, with links to the text is provided below. PreambleIdentifies the broad policy objectives that governments had in mind in developing the Agreement. When necessary, the preamble can be used in interpreting the Agreement. "Governments...resolved to promote an open, efficient, and stable domestic market for long-term job creation, economic growth and stability..." GeneralSets out the operating principles and the general definitions which form the basis of the Agreement and establish the extent of obligations. Constitutional AuthoritiesReaffirms that the Agreement does not alter the Constitutional powers of governments. General Rules1. Reciprocal Non-DiscriminationEstablishes equivalent treatment — by all governments — for all Canadian persons, goods, services and investments.
Examples: 2. Right of Entry and ExitProhibits governments from adopting or maintaining measures which prevent or restrict the movement of persons, goods, services or investments across provincial or territorial boundaries.
Example: 3. No ObstaclesRequires governments to ensure their policies and practices do not have the effect of creating obstacles to trade.
Example: 4. Legitimate ObjectivesRecognizes that, in pursuing certain non-trade objectives, such as consumer and environmental protection, public health and safety, it may be necessary for a government to deviate from the three preceding trade rules. In such cases, governments will need to ensure that any legislation or regulations they introduce:
Example: 5. ReconciliationProvides the basis for eliminating trade barriers caused by differences in standards and regulations across Canada.
Example: 6. TransparencyAssures that information is fully accessible — through publication and notification — to interested businesses, individuals and governments. Ensures exposure of potentially unacceptable policies and practices to public scrutiny.
Example: Sectoral ChaptersEach of the sectoral chapters in the Agreement outlines specific obligations in a particular economic sector. Highlights of these chapters are included below. (Chapter Twelve: Energy is currently under negotiation.)
Institutional ProvisionsHaving succeeded in reaching consensus, governments face the challenge of turning principles into practice. The institutional provisions establish the structure for the effective operation of the Agreement. The ministerial-level Committee on Internal Trade oversees the implementation and operation of the Agreement. This committee determines the areas and timetable of future negotiations on removing internal trade barriers. A secretariat, based in Winnipeg, provides administrative and operational support to the Committee on Internal Trade and any working groups or subcommittees that it establishes. Other ProvisionsThe Agreement contains several other important provisions which recognize that the existing accord is not a final product, but part of an ongoing process of constant improvement. Among the provisions are: trade enhancement arrangements which give governments greater flexibility in entering into new agreements; a relationship to international agreements clause which increases federal-provincial cooperation on global trade matters; and, measures related to future negotiations not covered by the Agreement. ExceptionsThe Agreement on Internal Trade recognizes certain exceptions for reasons of public interest.
Chapter Five — ProcurementPurposeTo ensure equal access to government procurement for all Canadian suppliers — in a transparent and efficient manner — in order to reduce purchasing costs and to contribute to the development of a strong economy. ObligationsGovernments are not permitted to discriminate against suppliers of another province or territory. This includes means such as local price preferences, biased technical specifications, unfair registration requirements or unreasonable time constraints. Governments must make opportunities known to suppliers through the use of an electronic tendering system, advertising in daily newspapers or the use of source lists. These must be accessible to all Canadian suppliers. What's Covered?All qualified Canadian suppliers have the right to bid on virtually all contracts tendered by most government departments and agencies which exceed $25 000 for goods and $100 000 for services and construction. An electronic tendering system has been developed to improve access to opportunities for suppliers across Canada. Suppliers can pursue bid protests at any point in the process. Procurement by municipalities, municipal organizations, school boards and publicly-funded academic, health and social services entities (MASH entities) is also covered in all jurisdictions except British Columbia and the Yukon. However, for covered MASH entities, the threshold levels are higher than for government departments: $100 000 for goods and services, and $250 000 for construction. MARCAN, is an initiative of the federal, provincial and territorial governments under the Agreement on Internal Trade. It has been developed as a gateway site to procurement opportunities within the Canadian public sector and is intended to help Canadian companies identify internet sites that may publish tender notices. What's Not Included?A number of federal and provincial agencies and Crown corporations, as well as some professional services, are currently excluded from the Agreement. Work is continuing to reduce the list of exceptions. Federal Government Contact
Roman Staranczak Chapter Six — InvestmentPurposeTo ensure that Canadian firms are able to make business decisions based on market conditions rather than on discriminatory or investment-distorting government measures. ObligationsProvides for non-discriminatory treatment of Canadian businesses regardless of where the head office is located, where the firm is incorporated or where the owners live. Limits local presence or residency requirements as a condition of carrying on business or making an investment. Prohibits the use of local content, local purchasing, and local sourcing requirements except in limited cases for regional development programs. REGISTREX has been created to standardize corporate registration and reporting requirements which should ease the compliance burden for firms conducting business in more than one province or territory. A Code of Conduct on Incentives prevents a government from "poaching": giving incentives to an enterprise located in another province or territory that would directly result in the relocation of that operation to the government's own territory. It also discourages the use of incentives which could be harmful to the economic interests of other parts of Canada. What's Covered?Measures adopted or maintained by the federal, provincial and territorial governments relating to Canadian investors and enterprises. What's Not Included?Does not apply to municipal governments or to measures relating to procurement by governments and Crown corporations. Annex 608.3 — Code of Conduct on IncentivesPurposeTo affirm that the principles of the Agreement apply to incentives and to minimize the adverse effects of incentives, offered by one province or territory, on the economic interests of other provinces or territories. ObligationsA government is prohibited from offering incentives that:
Governments are to refrain from providing incentives that would sustain uneconomic operations or increase capacity beyond what is warranted by market conditions. Report on incentives are prepared annually. What's Covered?Incentives such as: grants, preferential loans, debt guarantees and equity injections, ax breaks for specific enterprises, and any form of income or price support. What's Not Included?General investment promotion activities, such as the provision of market information. Incentives given to prevent the relocation of an existing operation outside Canada. Federal Government Contact
Philip Morrison Chapter Seven — Labour MobilityPurposeTo enable any worker qualified for an occupation in one part of Canada to have access to employment opportunities within that occupation in any other province or territory. ObligationsIn most cases, the requirement to live in a province or territory as a condition of employment or eligibility to practice an occupation has disappeared. In most cases, licensing, certification or registration of workers will be based on the competence of workers and does not result in unnecessary delays in obtaining necessary certification. Qualifications of workers from other parts of the country will be recognized. Differences in occupational standards for over 100 regulated professions and trades are being reconciled. The Forum of Labour Market Ministers is taking action to fulfill the obligations of this chapter. Under the terms of the Social Framework Agreement, all provinces (except Quebec) and the territories agreed to meet the labour mobility provisions of the Agreement on Internal Trade by July 1, 2001. However, Quebec has maintened its commitment to honour the obligations under the AIT with the confidence that regulatory bodies under its jurisdiction would achieve compliance on a voluntary basis within a reasonable period of time. Which Organizations are Covered?Government departments, ministries and agencies must comply with the provisions of this chapter. Governments will ensure compliance with the obligations of this chapter for: regional, local, district and other forms of municipal governments; and, occupational regulatory bodies and non-governmental organizations that exercise authority delegated by law. Other non-governmental organizations such as unions, education and training establishments, and professional associations have been asked to comply. More than 400 occupational regulatory bodies have been achieved compliance or are actively working to comply with the provisions of the Labour Mobility Chapter. What's Not Included?Certain employment and labour-related issues — differences in social policy measures, labour standards, minimum wages and social assistance benefits — are not covered. Some practices may still be permitted if they are intended to meet certain objectives, such as public security or labour market development. However, governments are encouraged to find other ways of meeting these objectives without restricting mobility. Current SituationBy July 1, 2001, 42 of the 51 professional regulatory bodies had achieved full or substantial compliance with the Labour Mobility Chapter requirements. These 42 regulatory bodies accounted for approximately 97% of persons working in the professions. In the government-regulated trades, the existing Red Seal program already provides for mobility for a majority of tradespersons and most provinces have made recent commitments to extend some form of recognition for tradespersons who are not covered by the Red Seal program. More information on inter-provincial/territorial labour mobility is available in the: “Report on Implementation of the Labour Mobility Chapter of the Agreement on Internal Trade” that was published by the Forum of Labour Market Minister in December 2001 document. Federal Government Contact
Martin Chaumont Chapter Eight — Consumer-Related Measures and StandardsPurposeTo streamline and harmonize standards, regulations and enforcement measures designed for consumer protection. Greater uniformity in standards allows firms to capture the benefits associated with a larger market while providing consumers with more competitive prices and greater product choice. Consistent regulations and standards also provide more certainty for consumers in cross-boundary transactions and increase consumer confidence in the Canadian marketplace. ObligationsThe Committee of Ministers responsible for Consumer-Related Measures and Standards — composed of consumer ministers from across the country — has signed the Cooperative Enforcement Agreement which provides measures relating to cooperating on matters such as reciprocal investigative powers, enforcement of revocation rights, financial compensation for consumers, and enforcement of judgements. Governments reconcile differences in consumer-related measures and standards, and ensure that consumer protection is not used to create disguised trade barriers. Governments are to refrain from requiring individuals to live in the province or territory as a condition of licensing, registration or certification as a supplier. Local presence and residency requirements for businesses are to be used only where necessary for consumer protection. Governments are no longer allowed to charge discriminatory fees for licensing, registration or certification of suppliers. What's Covered?Measures and standards designed to protect the consumer. What's Not Included?No measures are specifically exempted. Current SituationGovernments have harmonized specific consumer protection measures related to direct selling and upholsterd and stuffed articles. Consumer ministers continue to identify additional areas for harmonization. For instance, they have agreed to a harmonized list of prohibited collection agency practices and have approved a harmonized template for internet consumer sales contracts. Federal Government Contact
Michael Jenkin Chapter Nine — Agricultural and Food ProductsPurposeTo reduce or eliminate measures that create obstacles to internal trade in agricultural and food goods. ObligationsGovernments are to eliminate technical barriers to internal trade. Technical barriers result from differing product and grade standards, plant and animal health regulations, and legislation affecting the movement of products between provinces. Certain technical barriers related to agricultural trade policies are also within the scope of the Agreement as of September 1, 1997. These include regulations relating to margarine, butter blends and imitation dairy products. In close consultation with agri-food stakeholders, agriculture ministers have considered whether to try to broaden its application and further liberalize internal trade in agricultural and food goods. However, there is no consensus for moving forward at the present time. What's Covered?All agricultural and food goods. What's Not Included?Fish, fish products and alcoholic beverages. Federal Government Contact
Blair Coomber Chapter Ten — Alcoholic BeveragesPurposeTo reduce or eliminate barriers to interprovincial trade in alcoholic beverages. ObligationsGovernments are prohibited from discriminating in the areas of listing, pricing, access to points of sale, distribution, merchandising and service costs associated with alcoholic beverages. Governments are to: reconcile differences among standards-related measures, such as labelling and packaging regulations and requirements, as well as oenological practices (wine-making); and, ensure that wine and wine products are labelled in accordance with any national standards that may be developed by the Wine Standards Committee. Governments are to review and reconcile differences in the definition of wine and wine products given in the Agreement with that developed by the Wine Standards Committee. What's Covered?All alcoholic beverages. What's Not Included?Certain measures for beer and beer products and wine and wine products listed in the Agreement. However, these measures are to be either eliminated or reviewed by specified dates. Measures already in place under international trade agreements. Federal Government Contact
Gayle Smith Chapter Eleven — Natural Resources ProcessingPurposeTo prohibit the introduction of new trade barriers relating to the processing of forestry, fisheries and mineral resource products. ObligationsGovernments are prohibited from introducing natural resources processing measures that discriminate against other Canadian suppliers, subject to certain exceptions. Governments are to reconcile differences in any measures that impact on trade in the processing of natural resources. A working group will review whether this chapter has met its objectives and examine the opportunities to enlarge its area of application. What's Covered?Applies to measures adopted or maintained by governments related to the processing of natural resources, including the production and sale of forestry, fisheries and mineral resources products. What's Not Included?Does not apply to:
Federal Government Contact
Brian Smith Chapter Thirteen — CommunicationsPurposeTo enhance Canadian competitiveness by ensuring all Canadians have equal access to public telecommunications networks and their services. ObligationsGovernments may not discriminate in providing access to public telecommunications networks and the use of public telecommunications services. Governments cannot allow monopolies to use their economic power to engage in anti-competitive behaviour in their non-monopoly markets. What's Covered?Measures adopted or maintained by governments relating to communications services and telecommunications facilities. Federal Government Contact
Doug MacEwen Chapter Fourteen — TransportationPurposeTo reduce barriers to internal trade in transportation services, particularly for trucking. An efficient trucking sector is essential to Canadian competitiveness. The provisions in this Chapter will help to reduce transportation costs. ObligationsGovernments must reconcile differences among a variety of regulations related to the operation of commercial vehicles. These measures include safety standards, weights and dimensions rules, bills of lading, tax administration, and operating authority requirements for extra-provincial trucking operations. The Council of Ministers Responsible for Transportation and Highway Safety will help to reconcile differences among these measures, work to further harmonize regulations and standards, and prepare an annual report on its progress. Specific non-conforming measures listed in the Agreement are to be phased out. As provided in the Agreement, the federal government and the provinces have worked to develop and implement national motor carrier (truck and bus) safety standards through the National Safety Code for Motor Carriers. The federal government and the provinces are enacting legislation and regulations to establish a consistent national regime for regulating motor carrier safety performance, based on the National Safety Code carrier compliance standard. The federal government and the provinces of Quebec, Manitoba, Saskatchewan and British Columbia have, as agreed, repealed legislation which allowed economic regulation of the trucking industry. The federal contribution to this process was the repeal of part III of the Motor Vehicule Transport Act on January1, 2000. Canadian trucking is now completely deregulated at both the federaland provincial level. What's Covered?All interprovincial trade in transportation services, with commercial motor vehicles being most affected. What's Not Included?The intercity and charter bus regulation are not covered by this chapter Federal Government Contact
Joe Greenough Chapter Fifteen — Environmental ProtectionPurposeTo ensure that environmental measures do not become unnecessary barriers to internal trade, while permitting governments the flexibility to establish their own environmental priorities and levels of protection. ObligationsGovernments are restricted from applying environmental measures that discriminate against Canadians or create unnecessary barriers to the free flow of goods, services, investment or people across provincial boundaries. Governments are to harmonize environmental measures that may directly affect interprovincial mobility and trade. This will reduce the compliance and regulatory burden on firms as well as lower the cost of doing business in Canada. Governments must not, through such measures, lower the levels of environmental protection. Governments will not relax environmental measures to attract business. The Canadian Council of Ministers of the Environment will:
What's Covered?Environmental measures adopted or maintained by federal, provincial and territorial governments that may affect the movement of people or interprovincial trade in goods, services or investments. What's Not Included?Measures that do not meet this standard are to be listed by July 1, 1997. Each government is to develop a work plan to eliminate such measures by January 1, 2000. Environmental measures that have no trade-related implications are not covered under this chapter. Federal Government Contact
Ellen Burrak Dispute Resolution ProceduresThe Agreement on Internal Trade has been designed to maximize cooperation and minimize conflict. However, dispute resolution procedures have been put in place to address the differences that will inevitably arise among governments, as well as those between governments and individuals. The Agreement on Internal Trade offers a range of opportunities to resolve conflicts and lays out the various steps governments or individuals must follow to pursue a complaint. Each sectoral chapter contains its own dispute settlement mechanism. When a dispute arises, the procedures written into the sectoral chapters are to be used first. If those processes fail to resolve the problem, the formal dispute resolution procedures in Chapter Seventeen come into play. Government-to-Government DisputesSectoral Chapter ProceduresThe steps identified in the specific sectoral chapters entail consultations and, in some cases, reference of an issue to a quasi-judicial panel and/or a body of ministers. The dispute resolution procedures contained in these chapters recognize that sectoral officials, experts and ministers are best acquainted and best placed to deal with issues in their respective areas of direct responsibility. Chapter Seventeen ProceduresChapter Seventeen sets out a broad array of options to governments in conflict. They are followed when the dispute resolution procedures in the appropriate sectoral chapter do not solve the problem or when there are no sector dispute settlement procedures specified. Chapter Seventeen procedures include: a consultation stage where an additional, broader trade perspective may be brought to bear on issues; a stage where the assistance of the Committee on Internal Trade is sought; and, finally, if an issue remains unresolved, the striking of an independent panel of experts to examine the issue and make recommendations for its resolution. Panel proceedings are public. Once a panel report has been issued, the governments involved are expected to take action to comply with the report's recommendations. If a government does not act to implement the panel's findings or recommendations within 60 days, the panel report is to be made public. Such governments are also expected to report to the annual meeting of the Committee on Internal Trade on progress (or lack of progress) in complying with the panel report. Compliance/EnforcementIf, after a year, a government has failed to change or remove a measure that a panel has ruled is inconsistent with the Agreement, the complaining party may take retaliatory action — but only after discussions with the Committee on Internal Trade. Any retaliatory measure must be in the same sector (or another sector covered by the AIT) and must have an equivalent economic impact to the inconsistent measure maintained by the other government. Person-to-Government DisputesIn the case of grievances bybusinesses or individuals, a complainant must first use any dispute resolution procedures outlined in the pertinent sectoral chapter to attempt to resolve the problem. Only after these options are exhausted may a complainant turn to those set out to protect private parties under Chapter Seventeen. The individual or business may request that either the provincial or federal government, whichever has a "substantial connection" with the complainant, pursue their case. If a government is not prepared to act on behalf of a complainant, the person or company may initiate the person-to-government procedures. The first step is to submit the complaint to an independent "screener" — an impartial individual who will assess the merits of the grievance. If the complaint is not frivolous, the private party may then follow steps similar to the government-to-government process. These include consultations and ultimate recourse to a dispute settlement panel. At the end of the process — if approved by the panel — a vindicated complainant will recover costs directly related to pursuing the complaint. A panel report would be released to the public if a government failed to bring a measure into conformity with the Agreement. The Committee on Internal Trade would annually review progress in bringing measures into conformity with the report or recommendations of the panel. Substantial ConnectionFor a government to be able to act on behalf of a person (i.e, an individual, business or company), there must be a "substantial connection" between them. A "substantial connection" is most often found between individuals and/or businesses and their provincial government. Generally, the test for this is if the person resides in the province, and both the person and the province have experienced some form of economic injury. The Government of Canada may act on behalf of individuals or business only when they have suffered some economic injury because they are federally-constituted or because they operate under federal regulatory authority. The federal government may not pursue cases on behalf of private party complainants in other circumstances. Federal Government Contact
Roman Staranczak Internal Trade Representatives
Newfoundland
Nova Scotia
Prince Edward Island
New Brunswick
Quebec
Ontario
Manitoba
Saskatchewan
Shawn Robbins
British Columbia
Northwest Territories
Yukon
Canada |
|
|
|||
| Created: 2005-05-25 Updated: 2005-08-04 |
 Top of Page |
Important Notices |
||
