NAFTA and pesticides

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There’s an interesting debate forming around NAFTA and environmental protection laws.

Dow AgroSciences LLC, a subsidiary of U.S. chemical giant Dow Chemical is suing Canada for more than CAD $2 million in damages under NAFTA. Why? In a move well received by environmental groups, Quebec has prohibited the sale of 2,4-D, a widely used herbicide, in the province. Dow claims the ban lacks scientific support and amounts to an “expropriation” of its business in the province (many Dow products contain 2,4-D). Dow is not the first to use NAFTA’s dispute-settlement provisions to attack public health measures. In his column today, François Cardinal provides a good rundown of the issues.

One of the problems is that, while Quebec has banned 2,4-D under Quebec’s Pesticide Management Code (PMC-QC), the product is considered safe by Health Canada.

Pesticides used, sold or imported into Canada are governed by the Pest Control Products Act (Canada) (PCPA) and the Pest Control Products Regulations (PCPR). Only pesticides that are registered for use under the PCPA can be used in Canada. Think of the registration process as an oversight mechanism for the federal government. If it considers that a particular pesticide poses an unacceptable risk to human health and the environment, it can ban them from use by not allowing for their registration.

Provinces and territories also bar the use of pesticides that aren’t federally registered, because they adopt the PCPA. That said, they also have their own laws on the purchase, use, disposal and shipment of pesticides, as well as their containers. Often these laws can be more demanding than federal rules, though than cannot be less strict.

Quebec recognizes that there is a difference between the two jurisdictions but rejects Dow’s argument that the product is not harmful to human health. Canada’s position in all this? The province is entitled to make laws in the public interest. And as Cardinal reports, the City of Montreal, part of a larger coalition, is joining in Quebec’s defense as well.

Ironically, Canadian NAFTA observers have been worried that the new Obama administration is intent on reopening the trade agreement, which they fear could adversely affect Canada-U.S. trade relations. What gets lost is that Obama has talked about strengthening environmental protections under NAFTA and going so far as ending the right of foreign companies to sue governments for taking regulatory actions that protect citizens but interfere with their corporate profits.