Contributing Lawyers

Canada

Cyndee Todgham Cherniak

United States

Susan Kohn Ross

Australia

Andrew Hudson



Canada's Environment Minister on U.S. Climate Change Bill

On May 15, 2009, Canada's National Post newspaper ran an article entitled "U.S. Climate bill would be 'disaster'". For a copy of the well-written article, please go to the following link - http://www.nationalpost.com/news/canada/story.html?id=1593753

As Mr. Prentice pointed out to U.S. lawmakers, U.S. import duties and proposed trade sanctions (carbon border adjustment fee) on imports from other countries with higher levels of greenhouse gas emissions is a "prescription for disaster". It "violates the core principles of international trade".

What this is - clear bright and vibrant red, white and blue colours to various shades of green. The version of the American flag is not "prettier" or desirable. Prentice warned:

"Border carbon adjustments would be a thinly disguised restriction on trade and an impediment both to wealth creation and to the attainment of our collective objective, which is to address greenhouse gas emissions and to reduce them. They would constitute arbitrary discrimination. They won't work and they threaten constructive negotiations."

The border adjustment fees will be contrary to WTO principles ,the NAFTA and every other free trade agreement to which the U.S. is a party.

The U.S. should be very careful because their actions may have harsher ramifications on American and American jobs. Consumers in foreign jurisdictions may increase their own patriotism and stop buying American goods. Businesses which are negatively affected by the border adjustment fees will retaliate with their own business dollars and seek alternative sources of goods and services. Governments of countries that are targeted can adopt similar measures and imports border adjustment fees on U.S. goods. Governments can also exclude U.S. businesses from government projects.

Ironically,, the border adjustment fees may make Canadian energy more expensive - more expensive to U.S. consumers, businesses and local governments. It may limit U.S. refineries' ability to use Canadian oil sands resources, increasing the need to the U.S. to rely on Saudi Arabia and Venezuela. There is risk associated with such a shift.

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