Agreement on Internal Trade (AIT)

·         The AIT entered into force on July 1, 1995.  All of the provinces, Canada, and two of the territories are parties to the AIT.  The new territory of Nunavut is not.

·         The objective of this agreement is to reduce and eliminate, to the extent possible, barriers to the free movement of persons, goods, services and investments within Canada and to establish an open, efficient and stable domestic market.

·         The provisions of the AIT cover a wide range of sectors in the Canadian economy including procurement, investment, labour mobility, consumer-related measures and standards, agricultural and food goods, alcoholic beverages, natural resources processing, communications, transportation and environmental protection.

·         Negotiations on coverage of energy have not yet been concluded.

·         The agreement includes consultation mechanisms to help parties try to resolve disputes and a dispute settlement system.

·         The agreement is supervised by the Committee on Internal Trade (CIT) composed of Ministers of each of the Parties.  The CIT meets annually.

·         The province of British Columbia is working to eliminate interprovincial trade barriers that are hampering growth, investment and job creation across Canada.  On March 31, 2002, British Columbia was brought into full conformity with the AIT.  To date, British Columbia and Alberta are the only two jurisdictions in full compliance with the AIT.

·         From 2000-2002, the parties to the AIT engaged in extensive cross-Canada, public consultations in an effort to assist governments in identifying ways to improve internal trade in Canada.  These consultations formed the basis for recommendations to Canadian ministers responsible for internal trade on the future direction of the AIT.

·         In December 2003, the Council of the Federation of Premiers directed Trade Ministers to identify ways to further liberalize trade, investment and labour mobility in Canada.  Agreement was reached to initiate work to take immediate and early action to improve the AIT.  The resulting workplan was approved at the Council of the Federation meeting in February 2004.  As part of the workplan, on December 6, 2004, all parties to the AIT agreed to follow British Columbia’s lead by establishing open, non-discriminatory procurement for their Crown Corporations.  The agreement came into effect on January 1, 2005.

·         Other workplan items include:

o        Simplifying the AIT and extending it to areas not currently covered (led by British Columbia and Alberta);

o        Providing flexibility for decision making;

o        Improving the dispute resolution mechanism;

o        Completing negotiation of the Energy Chapter;

o        Addressing business subsidies;

o        Addressing labour mobility issues;

o        Accelerating the harmonization of regulations and standards;

o        Reviewing the scope and coverage of the agriculture chapter; and

o        Improving the procurement chapter.

Internal Trade Related Links

·        Agreement on Internal Trade

·         Internal Trade Secretariat

·         Council of the Federation

last updated December 2005