FAIT Committee Meeting

STANDING COMMITTEE ON FOREIGN AFFAIRS AND INTERNATIONAL TRADE

COMITÉ PERMANENT DES AFFAIRES ÉTRANGÈRES ET DU COMMERCE INTERNATIONAL

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, May 13, 1999

• 0910

[English]

The Chairman (Mr. Bill Graham (Toronto Centre—Rosedale, Lib.)): I'd like to call this session to order.

We're very pleased to have with us this morning as part of our WTO consideration our ambassador to the European Union, Jean-Pierre Juneau, who I'm sure many of you have met in Brussels. He's very generous with his time when members go there and make sure they get introduced to people in the European system. He's accompanied by Mr. David Plunkett, who is the director of the EU division, and Mr. Charles Craddock, who is the director of the eastern hemisphere division.

Welcome, gentlemen. You might be interested in knowing that yesterday we had a hearing at which Jeffrey Schott, from the Institute for International Economics in Washington, or possibly the other witness, Mr. Pierre Sauvé, said he thought the whole chance of an agriculture settlement in the upcoming round was somewhat skewered by the meeting in Berlin where the CAP was reaffirmed by the Europeans, and so on.

I'm sure the members will want to hear something about that, because that seems to be the refrain we're hearing as we go across the country, the trade war in agriculture between the European Union and the United States and how we're getting totally sideswiped by it.

Ambassador, perhaps you would like to start, and then we can move on to questions after.

Mr. Jean-Pierre Juneau (Canadian Ambassador to the European Union, Department of Foreign Affairs and International Trade): Thank you, Mr. Chairman.

Thank you for the opportunity to speak on the European Union and the next round of multilateral trade negotiations. It goes without saying that the European Union's approach to the next negotiations will be a key determinant of their success or failure. The European Union is the largest importer and the largest exporter in the world. It is also the largest importer of agricultural products in the world. It has a gross domestic product greater than that of the United States.

In the next round, the European Union will negotiate with the strength of a single market of 370 million people, the common currency, and the closest ever coordination of commercial and economic policy in its history. As it has in the past, it will exercise the leverage of its common customs tariff for 15 countries. It will exercise tremendous influence over the scope, content, and conduct of the negotiations. For all practical purposes, the European Union has a form of veto over the conclusions of the next round.

For almost three years, Sir Leon Brittan, the European Union's vice-president and trade commissioner, has been the strongest and most ardent advocate of a new round of negotiations. In fact, it was Sir Leon Brittan who coined the name “the millennium round.” He also said that the main challenge before us, following the last two years of financial crises, is to keep the momentum of trade liberalization going against the protectionist pressures that are becoming stronger around the world.

Sir Leon Brittan is not alone. The EU Council of Ministers unanimously endorsed a new round of multilateral trade negotiations on March 30, 1998. From the outset, the European Union has maintained that the new round must be comprehensive and a single undertaking.

While the European Union was a strong supporter and a participant in the successful sectoral negotiations that have taken place in the WTO since the end of the Uruguay Round in 1994—that is, information technology, telecommunications services, and financial services—it is also of the view that, for the time being, we have exhausted the opportunities for sectoral liberalization.

In addition to the traditional issues of export subsidies, market access, and domestic support, which will be the focus of the agricultural trade negotiations, the European Union will press for other issues. Specifically, food safety, animal welfare, and biotechnology will be raised. Our current disputes with the European Union on hormones in beef and genetically modified crops provide a glimpse of the EU's approach. They will argue for less reliance on science and more on socio-economic factors in a country's regulatory approval system.

• 0915

The upcoming meeting of the QUINT, an informal gathering of agriculture ministers from Canada, the United States, the European Union, Australia, and Japan, will be hosted by Minister Vanclief in Vancouver in July. This meeting furthers the dialogue among key agricultural exporters and importers concerning multilateral trade negotiations. The July meeting will include a discussion on reconciling the need for science-based technical and food safety measures and the desire to address consumer concerns about health, food, and a liberalized trading system.

[Translation]

An area where we are working to improve collaboration with the European Union is biotechnology in agriculture. We have established a biotechnology dialogue with the Commission. Under its rubric, we are working to establish a plan that will work toward harmonizing our systems.

The EU is already bound by the commitment to open agriculture negotiations in 1999, and services negotiations in the year 2000, as is Canada. The EU wants broader negotiations to increase the possibility of trade-offs between these sectors and others in the next few years.

Agriculture will be a pivotal issue in the next negotiations—just as it was in the Uruguay Round. The EU understands that, given its strong vested interests in the agriculture sector, it will be necessary for the next negotiations to have the broadest possible scope to increase the odds of finding an equitable balance of concessions among the major trading partners.

Agriculture will present a special challenge for the EU and for Canada. We were reminded of the EU's tremendous sensitivities in this sector twice in recent weeks. First, at the EU special summit in Berlin, when EU heads of State and government scaled down the reforms which their own agriculture ministers had already approved; and second, when European Agriculture Commissioner Fischler reacted strongly to the Cairns Group's response to these reforms.

[English]

The Cairns Group statement, to which Canada was a party, expressed disappointment that the European Union has done so little to reform its agricultural support to make it less trade distorting. Of particular interest to Canada, badly needed reforms proposed in the beef and cereals sector were severely restricted. Much work remains to be done before the European Union reduces export subsidies for these products in a meaningful way. Reforms for other products, such as sugar, tobacco, fruits and vegetables, and dry fodder—that is, dehydrated alfalfa—were not introduced at all.

On the other hand, the reforms approved at the EU summit in Berlin have one tremendous advantage. They may be insufficient, but they are real. After decades of talk, debate, proposals, and counterproposals, the European Union has finally succeeded in taking steps toward disciplining its agricultural support. It may not be enough to conclude the next round of negotiations, but it is enough to get it started.

• 0920

There is also reason to hope that more may be coming. In addition to the pressure the next round of negotiations will provide, the European Union has two other good reasons to further restrain its agriculture spending. The first is budgetary. Agriculture support costs the European Union about 40 billion euros, or $64 billion Canadian, and takes up almost half of the EU budget. However, we should also remember this accounts for less than 1.2% of each member state's gross domestic product.

The second reason is the political imperative of European Union expansion. Poland, Hungary, the Czech Republic, and other nations are banging at the door to get in. The process of negotiation is advancing. Germany and the other European Union members are strongly in favour. It is clear the European Union cannot admit the new countries without significantly amending its agriculture support without risking bankruptcy. Poland alone, for example, has more farmers than Germany and France combined.

Beyond agriculture, the European Union has a broad agenda it wants addressed. This includes the strengthening of the multilateral system, a further reduction of import tariffs and non-tariff restrictions, a higher level of liberalization for services worldwide, a transparent framework of international rules on investment consistent with sustainable development, and an international framework for competition policy, including enforcement mechanisms and transparent and non-discriminatory procurement practices. It would also like to see issues such as trade facilitation, trade and environment, intellectual property rights, and electronic commerce regulation on the agenda.

The European Union has some specific ideas to put forward on many of those issues. On industrial tariff reductions for example, the European Commission has advanced two options. The first is a duty harmonization approach, combining the use of tariff bands within which all members will be obliged to fix their tariffs with a maximum overall simple and/or weighted average tariff. The second is a differentiated duty approach, combining maximum tariff rates per tariff line with maximum simple and/or weighted overall averages—for example, a maximum tariff rate of 7% for specific products provided that the average rate for a group of products does not exceed 5%. Both alternatives would be differentiated between developed, developing, and less developed countries.

The commission stresses the importance of defining an approach that could be implemented with no specific exemptions for certain products. This approach follows what has been adopted in recent accession negotiations to the WTO.

[Translation]

Or—to put it more simply—the EU is actively looking for ways to make it easier for countries to reduce tariffs, by allowing them some flexibility in how much they reduce duties, and on what products, while still meeting some generally agreed targets.

The EU is making a special effort to convince developing countries that a new round of negotiations is in their interest. It argues that we will need to address issues of particular concern to them. However, it also believes that the price of supporting a new round of negotiations cannot be to excuse developing countries from the obligations they made in the last round.

Canada has some specific interests in common with the European Union which we can pursue in the new round. We face high tariffs in sectors other than agriculture—for fish, value-added forestry products and non-ferrous metals. The fish duties are a special problem because, not only must we export over a high tariff wall, but the European Union also gives preferential treatment to Iceland, Norway and some of our other major competitors. The combination of these two measures is especially trade-distorting. The 6% duty on aluminum is also an important problem and one that makes little economic sense, even from the perspective of key economic interests within the EU.

• 0925

[English]

Another good example is northern shrimp. Some exporting countries pay no duty, while Canadian shrimp exporters face a 20% European Union tariff. We have had some success pursuing short-term solutions. This year, for example, we succeeded in convincing the European Union to establish an autonomous reduced tariff quota for cooked and peeled shrimp at 6% instead of 20%. But this quota is limited in quantity—4,000 metric tonnes—and must be used between April 1, 1999, and March 31, 2000. Its establishment required an extensive campaign by our department, Mr. Plunkett, and the Canadian fish industry.

In the last round, the European Union agreed to eliminate duties on pulp and paper products by January 1, 2004. It is now in the process of phasing out those duties. In recent months competition negotiators have questioned whether paper producers in the European Union have colluded to keep prices high. This may lead publishers to push for acceleration of the phase-out on paper duties to ensure a competitive marketplace. Given the growth potential in the European Union market for Canadian paper producers, this is an issue we are following closely.

[Translation]

The European Union maintains en extensive framework of preferential trade agreements with other countries. In fact, Canada is one of very few countries—the U.S., Japan and Australia are others—which does not benefit from any preferential tariff rates into the EU. This compromises our competitive position for many products. A new round of negotiations will provide us with the opportunity to reduce these disparities by pushing the EU to reduce its most-favoured-nation tariff rate for many products that we export.

At the same time, successive rounds of EU expansion has resulted in the displacement of many Canadian exports. For example, when the UK joined the EU in 1973, exports of wheat and barley were displaced. When Spain and Portugal joined in 1986, cod and cherries were displaced. When Germany was reunited in 1990, we lost about $60 million in annual grain exports almost overnight. Finally, when Austria, Finland and Sweden joined, we were able to negotiate some compensation for displaced trade. For example, we were able to improve our market access for oats, snowmobiles, canary seed and ice skates—but not for the exact products which were displaced. We hope that a new trade round will allow us to push to improve our competitive position in the EU relative to our competitors inside the common customs tariffs, for example, for value-added forestry products, fish and non-ferrous metals.

[English]

As we approach the Seattle ministerial meeting, Canada can begin to fine-tune our negotiating objectives relative to the European Union. Because the European Union is our second most important trading partner, accounting for Canadian goods exports of more than $15 billion last year, and because our trade with the United States is primarily governed by NAFTA, the European Union will be our most important negotiating partner in the new round.

• 0930

The European Union will also be an ally for Canada on many important issues. In the last round, for example, Canada and the European Union were the primary drivers of the proposal to create a world trade organization. We will be looking for opportunities to work constructively with the European Union again. One obvious possibility is in the area of trade and cultural industries and products. Minister Marchi's sectoral advisory group on culture has issued a report on this subject that has elicited much interest in the European Union. Sir Leon Brittan has taken note of its recommendation and has personally suggested to me that leaders of cultural industries in Canada and the European Union consult directly with each other to see if we can establish some common ground. In Brussels we are working to facilitate this, and Sir Leon's views are shared by the commission's officials as well.

Another possibility is to cooperate with the European Union in improvements to the WTO trade rules. In the last round, for example, we made improvements to rules on sanitary and phytosanitary matters. Over the long term, clearer and better developed rules are the best way to prevent and deal with market access problems such as those we have with the European Union for green softwood lumber or asbestos.

Whether we are negotiating for better and more equitable access to the European Union market, trying to discipline European Union export subsidies into markets in which we compete, or working with the European Union to build a stronger international trading system and trade rules, which need both our interests, it is clear that in the next round of negotiations we will have to take an ambitious and proactive approach to dealing with the European Union.

The European Union is certainly actively preparing to negotiate. It is consulting with civil society; pushing forward in the quadilateral trade ministers' meetings, as it has this week; floating ideas in Geneva; getting on with agricultural reform; and trying to improve the climate of its trade relations with the United States to facilitate a successful launch in Seattle and an efficient negotiation to follow.

Romano Prodi, the incoming president of the European Commission, recently told the European Parliament that while international monetary stability is important, the real engine of economic growth for the European Union will be a further round of liberalization of international trade under the World Trade Organization. This suggests we can expect continuity between the approach of the old commission and that of the new.

We will continue to follow developments in the European Union closely. Minister Marchi is meeting with the commission this week at the quadrilateral trade ministers' meetings in Tokyo. Minister Vanclief will meet agricultural commissioner Fischler at the QUINT meeting of agriculture ministers on July 18 in Vancouver. Minister Marchi and Sir Leon Brittan will meet again in Brussels on June 16. The next day Prime Minister Chrétien will meet the commission president and Chancellor Schroeder in Germany for our biannual transatlantic summit with the European Union. Even the European Union's pivotal role in making a success of the new round—I can assure you we will stay on top of every development that is going to take place in Brussels in that respect.

Thank you very much, Mr. Chairman.

The Chairman: Thank you very much, Ambassador. That's a very helpful review of a great many issues.

We'll go straight to questions.

Mr. Deepak Obhrai (Calgary East, Ref.): Thank you, Mr. Ambassador, for the overview of what's happening. I have three questions.

In your submission you talked about the European Union being our number two trading partner, quite an important partner. Having stated that, in all the trade relationships we have, we don't have most favoured nation status with the European Union. We have noticed the government is putting more emphasis on trade with the Asia Pacific over there. Would one then venture to say that because our focus has shifted over there, we have not given much attention to the overall market forces that have been taking place in the European Union?

• 0935

This leads me to the second question, which is on the genetically engineered organisms over there. I think today is the deadline, isn't it, for the Europeans with the last WTO ruling, and nothing has come out of it yet. This would venture to say that we are on our way possibly to a trade war with the Europeans. Is that really what you think is going to happen? You perhaps can elaborate to us as to whether there really is a threat of a trade war going on with the Europeans on that issue. We are pushing for scientific data while the Europeans are not. So what's your view on that?

That leads to my third question, which is on the cultural issue, which is that to us Bill C-55 is pretty important. We have a different view from the government on Bill C-55 or split-run magazines. We know where the French position is on that, but what about the other Europeans? You did mention about Britain. How do they see this tiff going on between the U.S. and us on the cultural industry? What do the other European countries feel on that aspect?

So these are my three questions.

Mr. Jean-Pierre Juneau: Very good. On the first question, I think we have paid attention to our relations with the European countries over the recent years. And I must say that I have always felt at ease with the way we were defining our relations with the various parts of the world. In fact we have a global foreign policy. If we were paying much attention to Asia and the Pacific, at the same time the Europeans were also paying more attention to that part of the world. You may have seen in the press this week, for example, that the summit that was supposed to take place between the European Union and China—they have a summit once a year, and we have twice a year the same opportunity—was postponed at the request of the Chinese.

So we have paid attention. But there are problems we have had in our relations with the Europeans. First there was the fish crisis, which slowed the evolution of our overall relations with the European Union at that time. You may remember that shortly before that crisis the government had made the proposal of negotiating a free trade agreement between the European Union and the NAFTA countries. It's quite clear that this proposal was put on the back burner when we went through our fish difficulties. But this situation has been resolved now.

We have seen also in fact the attraction of the United States to our economy, the fact that our exports to the United States have increased so dramatically, now with us doing 84% of our trade with the United States. It tends to diminish a bit the importance of our relations with the Europeans.

But if you look, for example, at foreign direct investment, the Europeans are major foreign investors in Canada and they are the second most important foreign investors by far in our country. If you look at Canadian investments abroad you will see that Europe is by far the second most important area where Canadian companies decide to invest.

I may give you after our meeting a copy of a booklet we published two months ago, just to give the list of the various agreements we signed with the European Union over the last two or three years. You will see that we have signed agreements that are important from an economic point of view—for example, an MRA agreement, mutual recognition agreement, which we signed during the British presidency of the European Union last May. This is not the kind of thing that people discuss very much in the press, because they are technical agreements by nature, but they are very important to stimulate the economic exchanges between these two parts of the world.

• 0940

The last point I would like to make on this is that at the end of the day it's the Canadian business community that decides where they want to go. If they decide it's more interesting for them to go to the United States, for example, or to Latin American rather than Europe, well, that's their decision. What we do in Brussels is to make sure the Canadian companies, the Canadian people, enjoy a level playing field as far as our relationship is concerned, and to make sure we have an equal footing with the United States in that respect. I would not like it, anyway, for American companies to enjoy advantages we don't have with the European Union.

Today is May 13, the day of the final decisions on the beef hormones. Just before coming here I met with the director of cabinet of commissioner Fischler, who was not available at that time because there was a meeting of the commission that morning. That was my last day before I flew here. It's quite clear that today we will know the kind of compensation we may get from them. There are basically three issues.

First, we have published a list of products we can use for “retaliation” if we are not compensated properly for the problem of the beef hormones.

Second, we say we would like to have the equivalent of $20 million worth of compensation for the injury that has been done to the cattle industry in Canada. Well, we say $70 million; they say $20 million. There is a big gap there that has to be bridged. I doubt, to be very frank with you, that we will be able to bridge that through negotiation, so we may have to go to the WTO again, and the WTO would decide what's the exact figure that should be used.

Finally, we said to the commission that we would have a preference to be compensated by having the Europeans lower their tariffs on products similar to beef, so that the same regions of the country that have been injured by the destructive policies of the European Union can benefit from the reduction of the tariffs. That's also the preference of the European Union.

Obviously, with the Americans the situation may be a bit more complicated, because the amount of money is more substantial. But one point I would like to make on this before leaving the hormones is to say a few words about GMOs. You know, we have the impression that there is a trade war going on between the United States and the European Union, but I think it's very important to put all this in perspective. In fact there is a very substantial and very important economic relationship going on between the European Union and the United States, and.... You know, the trade policy specialists had a great day with the so-called “banana war”. The fact of life is that if you put this in perspective with the overall trade between the European Union and North America, these are basically peanuts. I mean, it's not—

The Chairman: That's another sore point.

Mr. Jean-Pierre Juneau: So the decision has been taken. You saw, for example, that even the commission was divided on that. The German commissioner Bangemann said publicly recently that he never agreed with the policy of the European Union on the importation system for bananas. But I think we hear about a trade war. The fact of life also is it is a difficult adjustment that is taking place between basically what are at this point in time the two major economic powers.

• 0945

Genetically modified organisms is a complicated issue. I must say that the consumers in Europe don't have the same kind of confidence in the scientific advice they get from their governments and their scientific community as we do here in North America. I mean, they had their fingers burnt in the last years about the mad cow disease. And every month, when you live in Europe, you see there is a new problem occurring. It's in Belgium one month, then it's France another month, and then it's.... So this has caused a major preoccupation among the consumers. They see GMOs coming, and it's not very well explained. I must say I don't think the private companies are doing a good job in explaining what the benefit is for the consumers of this new technology.

There was a poll mentioned in the last issue of The Economist:

A Eurobarometer survey conducted across the EU last year found that 86% of those questioned believe that food containing GMOs should always be labelled as such.

—that they are bad for your health. And more than 50% trusted consumers associations more than governments to give the proper advice on that.

So GMO is one of the most difficult issues that will have to be addressed in the next round of the WTO negotiations. While we say that these decisions, the decisions on GMOs, on hormones in beef, have to be taken on the basis of the best science advice available, they also have to take into consideration the desire of their consumers. I must say also that we are worried from time to time that there may be some kind of political interference in the process of scientific advice that is given in relation to issues such as the GMOs and beef hormones.

There is also the fact—this will be my last point on the GMOs—that some European Union countries are trying to catch up a bit. The technology in North America is much more advanced than is the case in Europe, and they like to use these protectionist measures to make sure their industry is going to be able to compete with all North American industries in the years to come.

Cultural issues—

The Chairman: Ambassador, I'm sorry to interrupt you, but we try to keep these sessions to about 10 minutes each, and we're now into the 14th minute of this one, so I'm going to have to stop you there and move on to somebody else. Your question was about culture, which is very important for us, so somebody else may get to it too. Maybe Mr. Sauvageau will be asking about that, but we'll try to get to it. I just want to let other people have an opportunity.

[Translation]

Mr. Sauvageau.

Mr. Benoît Sauvageau (Repentigny, BQ): I too will ask about culture.

Mr. Ambassador, thank you for meeting with us and for giving us a very complete picture of the upcoming negotiations.

My list of questions includes one on culture. I'll start with it, so that you can pick up where you left off in your response. However, my question is not about Bill C-55 per se, but about the new international instrument for protecting culture. You touched briefly on the fact that, after the SAGIT report was published, you had discussed it personally with Sir Leon Brittan and that he personally seemed quite favourable to this new approach.

In answering my question, you may at the same time answer the question asked by my colleague to the right, regarding Bill C-55. Apart from Sir Leon Brittan, who is nevertheless a very important person on the European trade scene, do you really believe there's a possibility that France or other countries will join Canada in this new initiative, in order to bring substantial weight to bear on the United States which, for all practical purposes, has not bought into this new approach?

• 0950

You've been in the heat of the action and you've seen how civil society was able, with the help of the Internet, to torpedo the Multilateral Agreement on Investment. Even though we aren't at the OECD, and I'm well aware of that, you are nonetheless very close to the action. We're talking about culture, which is a very important subject in the context of the Multilateral Agreement on Investment, and some would like to bring this issue before the WTO. There's also talk about an investment agreement as part of the WTO process. Do you think there could be a similar outcry, that might spill over the borders of Europe? If so, how can we protect ourselves from it?

My other question has to do with market access. For once, Canadian agricultural producers have adopted a common position for the upcoming WTO negotiations, which will give them a fair amount of clout. On the other hand, however, we have seen some fairly revealing figures illustrating how the European Union and the United States have not met their obligations in this area. Canadian agricultural producers are demanding that the Europeans and the Americans do their duty, before they contemplate making any additional concessions with regard to market access. I'd like to hear your comments from a European perspective, as opposed to an American one.

Thank you very much.

Mr. Jean-Pierre Juneau: Thank you. In the first place, with regard to culture, I must say that it's very significant that Sir Leon Brittan has reacted positively to the major conclusions of the SAGIT report. From an intellectual point of view, it was not a foregone conclusion. Brittan is really what I might call the ultimate free trader. I would even say that he is ahead of the European countries. Moreover, that's why France has always been somewhat uncomfortable with the role that this commissioner has played in Brussels in promoting free trade policies, and the energy with which he has played it.

I therefore find his reaction very interesting for us, especially since he wants us to set up a forum that would allow our cultural industries to meet in a more formal manner to discuss how to prepare for WTO negotiating sessions. I should point out that they themselves consulted fairly broadly with their cultural industries in a Europe-wide context when a new cultural policy and program were adopted about six months ago.

The Commission's role in the area of culture is not as firmly established as in the area of trade policy. Many of the member States are still very reluctant to see the European Commission play a significant role in this area. France would certainly be one of these countries that are somewhat uncomfortable with it. This is manifested in a number of ways. For example, last year we set up the first-ever consultations between the deputy minister responsible for cultural affairs and communications here in Ottawa and his counterpart, the Commission's director general for culture. The first meeting was held last year, and a second consultation meeting will take place in July here in Canada. The exact date has not been set yet.

When we discuss our objectives with the Commission, it always encourages us to discuss them with member States also. Let me tell you just how important it is, given the European Union's new configuration, to work with the Commission, of course, which has decision-making powers in some sectors, such as trade policy, but also with the member States because, at the end of the day, the approval of the member States must be set at the meetings of the councils of ministers that are held periodically.

• 0955

I believe that we will be able to work effectively with the member States and the Commission, since the cultural objectives of Canada and Europe are very close. Our American friends seem to understand this, moreover, because they have always been opposed to Canada's participating with them in the major transatlantic dialogue with the European Union. They are very much aware that we are closer to the Europeans in certain sectors that are very thorny for them, including the cultural sector.

You asked a very interesting question on the MAI. I'll give you my personal opinion. I believe that the problem with the MAI in the OECD is that this agreement was negotiated in secret. No one had heard it discussed and then, suddenly, at one point, the word was out and people wondered what was going on. Then the issue of culture was raised within the framework of this agreement, and people became nervous. They had the impression that decisions were being made for them, without their being consulted. Pressure groups, non-governmental organizations and the general public were excluded from the process.

Governments on both sides of the Atlantic learned a lesson from this. That's why you always hear people mentioning dialogue with civil society these days. There are the contacts, get- togethers and jamboree meetings that the European Commission now organizes with non-governmental organizations on issues like the environment, culture, labour standards and so on. In Canada, we hear Minister Marchi regularly stressing the importance of involving civil society in this process.

At the WTO, the discussions leading up to an investment agreement will be conducted differently and perhaps with more limited objectives. My personal opinion is that if we deal with it in economic terms only, and not in cultural terms, we will ensure that everyone understands and accepts the rule of law that apply to investing in various regions of the world. For example, if you invest in an Asian country, you must be able to understand the national legislation that regulates foreign investments and to ensure that your investments receive equitable treatment, that is, the same treatment as local investments. The main goal is to ensure that adequate information on questions such as investment are shared internationally.

If we are to avoid repeating our mistakes, we will have to hold a very open dialogue with the Canadian groups that are affected by this type of question, to ensure that the opinions of all stakeholders are taken into consideration.

I work in the area of investment and I believe that we can make better progress at the WTO than at the OECD, which is a smaller club. The WTO has 134 member countries, a great majority of which—100 of the 134 countries—are developing countries. The latter will be part of this decision and will feel they are participating in decision-making, rather than having to accept the consequences of a decision that is imposed from on high by another form.

You mentioned market access for agricultural products. I expected to hear a lot about agriculture this morning, and that's why I tried to find information that might be interesting and, above all, encouraging for you with respect to agriculture. First, we all know that negotiations in the agricultural sector will be difficult and tough. However, we have to keep in mind that there are some factors that work in favour of a country like Canada, which wants to facilitate conditions for market access, lower subsidies and so on.

If I may, I will first speak about the European Union and not about the United States. A few minutes ago, I alluded to the expansion of the European Union. There are reasons for the Europeans agreeing to opening up the agriculture agreement this year. It's not just because they have suddenly become free traders on the eve of the 21st century. They know that there will be enormous pressure brought to bear on them by Eastern European nations, when the latter enter the European Union.

• 1000

Second, there is a budgetary problem. I could give you details if you're interested. There are also very strong pressures here because the burden of the European budget is not shared equitably; Germany pays approximately 28 p. 100 of the budget; France, 17 p. 100; and Great Britain, 11 p. 100. The Germans are already showing signs of the strain. As we saw, Chancellor Schroeder attempted to change agricultural policy but, faced with pressure from certain other partners, including France, he had to agree to agricultural reforms that were weaker than what he had wanted.

We should also keep in mind certain technical elements including, for example, the off-cited peace clause, namely article 13 of the agriculture agreement, which will expire at the end of 2003. After that date, if no new agricultural agreement has been signed, we will be able to bring our European partners to the WTO and require that they appear before panels for sectors in which their policies do not comply with the provisions already set out in the agreements.

This peace clause prevents us from bringing such cases to the WTO. But the Europeans are well aware that, in 2003, these provisions will no longer apply. I will quote two extracts from a speech given by Sir Leon Brittan at the 53rd Oxford Farming Conference which was held on January 5, 1999. This is perhaps the best speech ever given by a European Commission representative on agricultural issues.

[English]

Since the result of the reforms will lead to an increase in the “blue box” payments in beef and cereals and to the introduction of new “semi-decoupled” direct payments in the dairy sector, it is obvious that the EU will have to fight hard for the maintenance of this box.

Then later in the speech il dit:

In my opinion, it is in fact likely (and desirable) that the EU will be in a position to make further changes to its system in the direction of more de-coupled and degressive aids.

[Translation]

As I said earlier, it goes without saying that some people will dispute Mr. Brittan's opinion. Not all of his partners and commissioners share his views. I wanted to show you that there is a debate going on in Europe on this issue. The Germans think that they are paying too much and free traders like Sir Leon Brittan are saying that it's a policy that makes no sense. Our agricultural negotiations, like Mr. Craddock, will have to ensure that we show the necessary firmness, without losing sight of the fact that there are certain sectors that are especially sensitive for us.

The Chairman: Mr. Patry.

Mr. Bernard Patry (Pierrefonds—Dollars, Lib.): Thank you, Mr. Ambassador. I am a physician and therefore take a practical approach. I'll try to ask very specific questions.

You have talked about agriculture and mutual concessions, and you have focussed on the fact that agriculture is a very sensitive subject for the European Union. In fact, this message came across clearly when the heads of State recently backtracked in Berlin.

After the preceding rounds, Canada met all of its agricultural obligations, while the United States and the European Union continue to subsidize their own agricultural sectors with billions of dollars. Before agreeing to further concessions—and I don't know whether we have any to give, because I have the impression that we have already given a great deal compared to what we have received—Canada should find a way to force the European Union, which is what you are concerned with—I will not deal with the United States—to fulfill its obligations. It's fine to talk about a new agreement for the year 2003, but we don't have it yet. In Quebec and in the rest of the country, we export huge quantities of agricultural products but farmers have less money in their pockets. We cannot ignore the human aspect of the problem. Some people are concerned about exporting companies, but I am mostly interested in the human aspect, the farmer.

• 1005

My second question has to do with intellectual property and pharmaceutical company patents. The European Union brought a complaint against Canada with regard to stockpiling and... [Editor's note: Inaudible] Canada retaliated by launching proceedings against the European Union regarding the surpassing of 20 years of protection for pharmaceutical patents. In your opinion, does the European Union wish to reopen this file? If so, where is it heading?

My third question is somewhat related to Mr. Sauvageau's, and has to do with the concerns expressed by civil society and NGOs regarding the environment and labour standards. You mentioned the jamboree meetings, but Canada, with the Free Trade of the Americas Area, has opened up a certain component. Very targeted discussions have been initiated with civil society and NGOs. Do you think that the European Union—which is not the WTO as such—is ready, or do you think it is planning to ignore civil society and the NGOs?

Mr. Jean-Pierre Juneau: Well, Canada has respected all its obligations, and I want to believe that. With regard to agriculture, it's very important to remember that Europeans feel that agriculture also takes in the products of the forest and the sea. In my remarks, I referred to two sectors, including fishery products. Of course, the way I see it from Brussels, that should be one of the Canadian government's priorities. It makes no sense that a tariff of 20% is levied on the fishery products that Canada exports. No matter how one looks at it, it's an incomprehensible situation, especially since no tariff is placed on nations such as Iceland and Norway.

Another sector of special importance is green softwood lumber. The pinewood nematode problem is important, but we have been exporting wood to Europe since the 17th century and we've never encountered a problem of this kind. Suddenly, just when the Scandinavian countries, who are our competitors in forest product exports, enter into the European Union, we are told that pinewood nematode represents a problem and Canadian exports are hit with annual losses of about $700 million. This is a very significant amount of money.

Among the other sectors where we should seek improvement, there is of course processed food products. What strikes me when I'm living in Europe is just how much of a set idea Europeans have about what they want to do and the objectives they are pursuing. For example, relatively low tariffs are applied to imports of certain basic products and raw materials. But as soon as you are dealing with processing, and especially agrifood processing, significant tariffs come into play. It's therefore essential to keep in mind the whole aspect of reciprocity. This may affect sectors such as cheese or organic products. As you know, there is a substantial market for organic products in Europe, and it is growing. One of the perverse effects of their subsidized agriculture policy is the significant environmental deterioration taking place in Europe that affects drinking water and agricultural land, because the land is over-exploited. Everything depends on how we want to define our priorities.

• 1010

My last example will be canola, because I'd like to use examples that are relevant for different regions in Canada. At one time, we exported $240 million's worth of canola to the European market. Canola is one of the crops for which we do not have to fear competition from our American neighbours. It is important that we define Canadian priorities and that we avoid concentrating our efforts in areas where we may lose our market share to Americans. We have to define opportunities for Canada to increase its exports. Canola is a good example. It's related to the problem of genetically modified organisms, which will of course be discussed at the upcoming WTO negotiating sessions.

When we're negotiating with the European Union, we're dealing with another kind of elephant, if I can use the analogy that one Prime Minister used when he talked about sleeping beside an elephant. We're sleeping beside another kind of elephant, an elephant that is less important to us in terms of bilateral economic relations, but which still has an elephant's reflexes. The European Union represents 40% of the international agricultural market, which is a very high percentage. No one would claim that it's easy to negotiate with this power.

The question of pharmaceutical products is currently being studied by the WTO. It's very clear that the Europeans, and in particular those European companies that are represented in the pharmaceutical market in Canada, would like to benefit for a period beyond 20 years, namely 20 years plus six months. I don't remember exactly what this period of six months represents, but it seems to me that this nevertheless represents a fairly substantial benefit, equivalent to additional revenues of 200 million dollars if they continue to be the only suppliers on the market for this period. I don't have a lot to say on this issue that has been brought before the WTO. At this stage, it's not a matter that is being discussed with the European Commission. The tendency is rather to let these events play out in Geneva.

As far as dialogue with civil society is concerned, the Europeans have made good progress. Have they made more progress than we have? I would say that this is probably the case. They have really thrown themselves into this dialogue and they expect that issues like the environment will receive a great deal of attention in the upcoming multilateral trade negotiations. We still have to determine with them how best to proceed with this dialogue. Should we adopt the conclusions of the committee on trade and the environment, which is already at work in Geneva, or adopt a more global, more horizontal approach? The Europeans tend to favour this more horizontal approach to all environmental issues. Regardless of the sector, whether it be agriculture or industry, they would like environmental concerns to be always considered in each of the sectors.

The partners have not yet come to an agreement on the best way to approach the question of the environment at the next WTO round. As for civil society, I have to say that I'm fascinated to see that, about two months ago, it took part with professional associations, non-governmental organizations and consumers in a one-day meeting chaired by Sir Leon Brittan to debate the key objectives to the be followed by the European Union at the next round of trade negotiations. The Europeans defined, one year ago, the type of objectives that they generally wish to follow for the negotiations.

The Chairman: Thank you.

• 1015

[English]

Let me ask two quick questions, Ambassador, and then we'll pass on to other questioners. One has to do with ice wine, which is a very eminent product of the province of Ontario. I understand that our ice wine does not have any access or has very limited access in Europe because of their rules, and it's from a phytosanitary pretext that its sugar content exceeds whatever the definitions are. But anybody who has ever had a bottle of sauterne in their hands knows that its sugar content well exceeds anything that ever was in an ice wine. I understand that American and Australian ice wines are given a derogation and that in fact it's the German lobby that is keeping Canadian ice wine out.

Does this mean we're not going to see any ice wine in Europe between now and the end of the next Uruguay Round, or do you see some chance of solving that problem before the year 2025 or whatever we're going to drag this thing out till? That would be the first question.

You mentioned the importance of the relationship between the U.S. and Europe. You know that they signed the Madrid accord, and they're obviously galloping ahead of us in terms of the closeness of their relationship with the European Union. Do you see any chance of Canada catching up to the United States now that we've put the problem of the fish war and other issues behind us?

Mr. Jean-Pierre Juneau: Thank you very much. With regard to the wine, in fact we just had consultations two weeks ago with the commission on this subject when Mr. Plunkett was in Brussels. Basically, the problem now with Europe is that they want to negotiate a wine agreement with Canada before improving our access to their market, which is limited to 1,000 hectolitres of wine per year.

The trap in all of this is that basically they want to use these negotiations to discuss the problem of appellations contrôlées, the fact that we are using in Canada appellations such as champagne or port. It has been their objective with all of their negotiations around the world to make sure they have an agreement that would ensure a better protection of des appellations contrôlées.

So the question is the following: Are we going to be in a position to negotiate on these appellations contrôlées and the protection the Europeans want to get in that respect in order to get better access to their market? I think we should negotiate—

The Chairman: Why don't we just tell the LCBO to limit their imports to 10,000 hectolitres of French wine and German wine?

Mr. Jean-Pierre Juneau: We made the point—

The Chairman: Why don't we use the leverage of what is the single largest purchaser of wine in the world to—

Mr. Jean-Pierre Juneau: We import $350 million worth of wine from Europe per year, and we export $1 million worth, so we should not be on the defensive when we negotiate those issues. But the question is, do we want to put the issue of these appellations contrôlées in that kind of a negotiation? That's a question that remains to be resolved.

Mrs. Sheila Finestone (Mount Royal, Lib.): Why not?

Ms. Colleen Beaumier (Brampton West—Mississauga, Lib.): Yes, we do.

The Chairman: No, I don't think so. But anyway....

Ms. Colleen Beaumier: Why not?

Mrs. Sheila Finestone: She obviously has a wine producer in her riding.

Ms. Colleen Beaumier: No. I don't even like wine.

Some hon. members: Oh, oh.

The Chairman: I think Madam Beaumier's response is more to my suggestion that we get the LCBO to weigh in there, rather than to Mr. Juneau's point, which is that if we accede to the European desire to link the issue of access to their markets to the appellations contrôlées system, they're going to say that we have to change the names on all of our wines so that we don't in any way reflect on any French wine.

Mr. Julian Reed (Halton, Lib.): That's not a bad idea.

Ms. Colleen Beaumier: Okay.

The Chairman: That's something they're trying to get everybody in the world to do. Then you get into arguments about the generic nature of grapes and stuff like that.

Mr. Julian Reed: We'll protect the name “Canadian whiskey”.

Ms. Colleen Beaumier: Absolutely.

• 1020

The Chairman: That's from the champagne case. We've already lost it. So we're going down that road, but anyway....

Mr. Jean-Pierre Juneau: [Editor's Note: Inaudible]...would have to be taken, and hopefully we will be able to ensure better access for our wines.

The Chairman: Do we have to wait for the WTO?

Mr. Jean-Pierre Juneau: No, I think it's independent from the WTO process. I think a bilateral negotiation has to take place.

On the relations between the U.S. and Europe, I would say that we are not lagging behind the United States. We were at one point. When the Americans signed their political declaration and action plan at the Madrid summit in 1995, obviously they were speaking about what they call “the transatlantic marketplace,” which had many elements of a free trade agreement between the U.S. and the European Union. But this transatlantic marketplace didn't move ahead, because it was eventually vetoed by some European partners, in particular by France, which didn't want to enter into that kind of negotiation with the United States before the WTO because they knew they would have had to negotiate agriculture, and they don't want to discuss agriculture with the North Americans in too many fora. They prefer to concentrate these negotiations in the WTO.

Eventually the transatlantic marketplace was replaced by something they call the transatlantic economic partnership. We were able to get a similar kind of agreement, which is called the ECTI, Europe-Canada trade initiative, which was signed here in Ottawa at the summit the Prime Minister had with the Austrian president last December. We are moving forward with the implementation of that ECTI, and I would say...not because I want to indicate that we are doing better than the Americans, but we do from time to time, and certainly in this case we are more advanced at this point in time than the Americans in the implementation of the ECTI. We will have the occasion to review the implementation of that program at the summit we are going to have in Bonn on June 17.

I have not received a report, but Mr. Marchi was supposed to have had a bilateral meeting with Sir Leon Brittan in Tokyo earlier this week. Minister Marchi is coming to Brussels, as I said earlier, on June 16. He's going to have a long bilateral meeting with Sir Leon Brittan, and the Europe-Canada trade initiative will be a key element of the discussion he's going to have.

So we are not doing badly compared to the Americans at this point in time.

The Chairman: Thank you. That's encouraging.

I have Madam Finestone, Mr. Turp, and Mr. Sauvageau on my list, and we seven or eight minutes. Can we maybe try all the questions and see if Mr. Juneau could answer all of them? Why don't we do them seriatim?

Mr. Sauvageau and Mr. Turp.

[Translation]

Mr. Benoît Sauvageau: You had a lot to say about fishing and agriculture. Some of the stakeholders in the fishery sector, if I'm not mistaken...

[English]

Mrs. Sheila Finestone: Excuse me, I thought it was my turn. All right, go ahead.

[Translation]

Mr. Benoît Sauvageau: You talked about fishing and agriculture. Some of the stakeholders have told us that these two areas of activity should be separated. What is your position on this suggestion advanced by the fishing industry?

The Chairman: Ask all of your questions now.

Mr. Daniel Turp (Beauharnois—Salaberry, BQ): Mr. Juneau, I'm sorry I was not able to be here for your presentation. I look forward to reading the minutes.

My question has to do with how the European Union is negotiating or will negotiate in the upcoming millennium round. My question has to do more specifically with how the member states will take part in the negotiations. We know, or perhaps it would be interesting for you to tell us about this, that the office of the president of the Commission acts as the negotiator for multilateral trade negotiations, but that the member States participate too.

I'm putting this question quite candidly and I think the provinces should also be party to the negotiation not only during the consultations here, in Ottawa, but also where things are happening. So I'd like to know how the negotiating process works within the European Union.

• 1025

Mr. Benoît Sauvageau: And also the role of the provinces.

The Chairman: By the European Parliament?

Mr. Daniel Turp: If you also want to talk about the role of Parliament, go ahead. It's true that that's a good idea, Mr. Chairman.

[English]

The Chairman: Madam Finestone.

Mrs. Sheila Finestone: It was interesting to hear you say that Sir Brittan was interested and positive with respect to the cultural products being looked at from an economic or investment perspective. Is he talking about through the World Trade Organization? Is he looking at the large picture?

You said as well, in regard to the jamboree meetings, that the NGOs, the civil society, have had a meeting about the cultural industries. Are they looking at the kind of report we have before us from the SAGITs of Canada? Did they have knowledge of that report, and are they supportive of the same? I'm curious about that.

We've looked at culture from an exemption perspective. Are they seeing it better to include culture in the broadest dimension?

I have to tell you as an aside, Monsieur Juneau, I'm very pleased to see you again. We just saw each other in Brussels, and it's nice to say hello to you on Canadian soil.

I got the sense from listening to what you were saying that Canada is awfully mousy in its approach.

[Translation]

They're actually quite timid. You said that the U.S. and Europe has already decided what their priorities were, especially in the area of agriculture, but that we weren't in much of a rush. I thought that the farmers, for the first time, were properly organized in what they were doing and did have a proper grasp of all the dimensions and knew what direction they wanted to take. But from what I'm getting from you,

[English]

you say we, the Canadians, have respected all the decisions of our panels. The Europeans have taken advantage of us, as have the Americans. You said you believe the Europeans and the Americans are very focused and know where their priorities are and what they want to protect, and Canada hasn't focused in the same way, that the civil society has been far more advanced, and that they're looking particularly at the environment, as well as social impact and labour, and yet they abuse their fields to an incredible extent.

I'm getting some kind of a mixed message as to what really is happening. Are we naive? Are we slow? Are we mousy next to these two different elephants?

The Chairman: Mousy or mouthy?

Mrs. Sheila Finestone: Both.

The Chairman: You wish we were more mouthy. Is that it?

Mrs. Sheila Finestone: That's right. Exactly.

The Chairman: Okay.

Mrs. Sheila Finestone: I think we're very mousy.

The Chairman: Unfortunately, we only have about three minutes left. I don't know if you can race through all that, Mr. Juneau, but....

[Translation]

Mr. Jean-Pierre Juneau: I think that fisheries and agriculture are sectors that should be separate, but at some point, you're going to have to go for trade-offs. That could come from that sector or others. In my opinion, the objectives have to be clearly separated.

As for how Europeans negotiate, first you have the Commission that takes the initiative to make recommendations to the European councils, in this case, the Trade Ministers Council.

I mentioned in my presentation that in March 1998, the European Union Trade Ministers Council had supported the proposal of the Commission to the effect that the next multilateral round of negotiations, the millennium round, should be extended, limited to three years and so on.

When you're in Geneva or discussing trade policy, the only spokesperson is the representative of the Commission, Sir Leon Brittan, for the forums or international organizations, or the Ambassador of the European Commission to Geneva, who speaks for all member states.

• 1030

However, there is a regular and ongoing consultation and concertation process. In any case, earlier this week, there was a meeting of the international trade ministers from the European Union countries in Berlin and they reiterated the objectives they wanted the Commission to pursue during the next international round.

I am abroad, but from what I understand, there is also consultation between Minister Marchi and the provinces on these matters. I've never been a participant because I'm over there, but I believe there are consultations on that.

Mr. Daniel Turp: My real question is this. During the negotiations, after November 1999, are the member states of the Union going to be there, in Geneva, to participate in the discussion while the negotiations are ongoing?

Mr. Jean-Pierre Juneau: They're there, in another room. I even think that for some meetings, they can be in the room where the General Council is meeting but the interlocutor intervening on that subject is the Commission.

I'll give you an example.

[English]

The Chairman: We've had provincial representatives on our delegation, certainly at the last two I've been at.

[Translation]

Mr. Daniel Turp: Not always, no, no, no.

[English]

Mrs. Sheila Finestone: Now and again they're consulted with in-between...when decisions are taken.

[Translation]

Mr. Daniel Turp: I was asking if they were there.

Mr. Jean-Pierre Juneau: It must also be said that the member states are also members of the WTO.

Mr. Daniel Turp: Yes.

Mr. Jean-Pierre Juneau: So on that level, there's a difference. The Canadian provinces are not, yet.

I wanted to say something else. Concerning the selection of the next WTO director general, in a way, the European Commission is paralyzed because the States can't agree. For example, we know that Sir Leon Brittan supports Roy MacLaren, the Canadian candidate. All of a sudden, France is supporting New Zealander Mike Moore while other countries like Great Britain, Sweden and the Netherlands tend to support the Thai candidate. Finally, the European Union isn't expressing itself. In Geneva, they have no voice, if you will.

They report annually to the European Parliament on the relationship with the WTO. They recently presented their second annual report to the European Parliament concerning the upcoming WTO negotiations.

Ms. Finestone, I think I didn't express myself correctly. I came here to explain the preparatory work that was done by the European Union to date.

[English]

It's important to understand that for the first time in the history of the WTO, you will have a next round, which is going to take place at the initiative of Europe, not the United States. So that's why they have been at the forefront on many issues. That's why they have given a mandate to the commission. That's why, for example, Sir Leon Brittan has been calling for that millennium round for the last three years.

I don't think they are necessarily more advanced in all the sectors. For example, the agricultural sectors have announced a very modest reform of the CAP, and some of them are suggesting they are not going to move from there. It's quite clear they will have to move. Where are they going to move? How are they going to move? They don't know. And that's going to be a very nice exercise, to see how they trade between themselves on this issue.

You mentioned culture. They didn't have a jamboree meeting on culture. The only thing they have on culture is a group of cultural industry advisers to the commissioner who is responsible for culture, Commissioner Oreja.

Last year he received a first report on what should be the cultural policies of the European Union. The SAGIT reports on culture clearly show that we are more advanced than the Europeans. We have distributed that report widely to the European Parliament, to the commissioners.

• 1035

As I said, Sir Leon Brittan came back to me and said it's very interesting; we'll have to make sure our cultural industries meet and have a discussion together. This is an area where we are more advanced than the Europeans and certainly more advanced than the Americans, who would like a kind of status quo.

Mrs. Sheila Finestone: Hegemony.

Mr. Jean-Pierre Juneau: As far as the United States is concerned, I have not followed their degree of preparation, but my impression is that we are more advanced than they are. They know where they would like to go generally, but at some point in the negotiation like this you have to move from the general to the specific. It's when you move to the specifics that you encounter some difficulties.

That's the problem the Europeans are going to have. They are going to have a change of commission, by the way, in September. There will be a new commissioner responsible for trade policy, so Leon will be leaving. We don't know who's going to replace him. It will be interesting to see how they move forward with their new team.

The Chairman: We have to leave it at that, because we're well over our time. We're going to have a vote this morning, which is going to eat into the next panel. So we really have to get going.

Thank you very much for coming, Mr. Juneau. There was a question asked about the European reaction to Bill C-55.

Mr. Jean-Pierre Juneau: They are curious. They have no reaction.

The Chairman: They have no reaction, positive or negative?

Mr. Jean-Pierre Juneau: They are just following that with great interest. Obviously, some comments were made to us that the level of possible retaliation from the United States was, as far as they were concerned, totally out of proportion.

The Chairman: They were seeing it in the light of the banana war rather than—

Mr. Jean-Pierre Juneau: Yes, very much so....

The Chairman: We appreciate your coming, Monsieur. Have a good return to Brussels. We'll all try to come and visit you there.

Mr. Jean-Pierre Juneau: It's always a pleasure to have you there.

The Chairman: Thank you.

Okay, members, let's ask our next group to come up. This is the preclearance bill, again, which we're going to hear. We have the Canadian Bar Association and the Air Transport Association of Canada.

We'll start with the Canadian Bar Association. We're going to have to get this going because there's the risk of a vote.

• 1040

We know there were some problems in the Senate with the bill, and we're very anxious to hear from the Bar Association on what happened and whether they're satisfied with the changes made to the bill. Then we'll turn to the Air Transport Association.

Are you going to start, Ms. Bercovich?

Ms. Joan Bercovich (Senior Director, Legal and Governmental Affairs, Canadian Bar Association): I'll start, thank you.

On behalf of the Canadian Bar Association, I would like to thank you for the opportunity of allowing us to appear before you this morning.

[Translation]

As you know, the Canadian Bar Association is a national association whose members are jurists from all across Canada. One of our objectives is to improve the law and the administration of justice. Our presentation here today is in pursuit of that objective.

[English]

Our brief will be presented by Michael Greene, who is an immigration lawyer in Calgary. He will be happy to take your questions following his presentation.

Thank you.

Mr. Michael A. Greene (Treasurer, National Citizenship and Immigration Law Section, Canadian Bar Association): We have prepared a letter that should be read as a supplement to our brief. A copy of that letter would have been circulated in the last day or two, because we had rather short notice of this and we just put that in for you. That letter summarizes our key concerns.

As immigration lawyers in the immigration law section of the Canadian Bar Association, we represent people going across the borders in both directions. We became aware of this bill at a rather late hour, when it was already before the Senate. We prepared a brief, which you should also have before you, that outlined our concerns. Then we appeared before the Senate.

We bring some concerns regarding legal issues. We are not policy people so much, and we leave the policy issues to the lobbyists, the interest groups and the lawyers representing the airlines. We have a number of those at the table here who will be presenting after us.

We are aware of ATAC's position and we've spoken with everybody at this table. We want to make it clear that we support preclearance legislation. We support the concept of preclearance, we support the concept of in-transit facilities, and we also support the need for legislation. The way we see it right now is there is no legislation in place, there is no legal authority for what is happening at preclearance areas. It is a highly questionable process right now, and that needs to be cleaned up.

We have a number of serious concerns about the way the particular legislation is drafted and about a number of the provisions in the legislation. Some of the concerns were addressed by the amendments put forward at the Senate, but some of them weren't, and some of them are very fundamental.

It's our belief that there's a substantial intrusion upon Canadian sovereignty and that there's a compromise of Canadian integrity that is unnecessary. We can achieve the stated purpose you see in clause 4—that is, to facilitate the movement of travellers and goods—without that compromise to Canadian integrity.

We have very briefly read the submissions of ATAC, which were just prepared in response to our brief. We gave them a draft of our brief on Monday and they hastened to respond so we could have some informed discussion. I must apologize I can't meet everything.... We can do that in questions. I know their concern is that it's an all or nothing thing: if every one of these provisions doesn't go through, the U.S. is going to pull up stake and move out of the country, and we're not going to have preclearance areas. That's the way I read it, and we don't want to sabotage the preclearance process. We do feel there are some amendments that need to be made to the legislation before it is enacted into law.

The Chairman: Mr. Greene, I'm afraid the unfortunate thing has happened: they've called the vote. In fact the bell has already started. We only have seven minutes, so we're going to have to hike it there right now.

Mrs. Sheila Finestone: Are we coming back?

The Chairman: Yes, we'll come back.

Please, members, do come immediately back, because this is very important. We have to get this evidence in, because this is the one area where we'll be....

I apologize for this. Mr. Greene and everybody, if you would just stay here, we'll come back here immediately afterwards.

• 1045

• 1119

The Chairman: Let's reconvene, members.

I apologize to the witnesses for the break. We'll try to prolong this session until 12.15 p,m. or 12.20 p.m. to see if we can catch back some of our time.

• 1120

Mr. Greene, you were coupé à mi-parole. Go ahead.

Mr. Michael Greene: Thank you.

The Chairman: We'll have to read your letter when we're up there taking the votes.

Mr. Michael Greene: There you go, read and walk across the street at the same time.

In terms of our position, we'd just state that we are in favour of legislation, and we'd like to see it happen soon. First, we understand there's a lot of pressure to make it happen fast to legalize what's happening there. And there's also a lot of interest in the airline industry in getting these in-transit facilities going, because it will be a boon to the Canadian industry.

What we want to talk about is our concerns regarding specific provisions of the bill and how we think those concerns can be addressed so that the purpose of facilitating the movement of goods and people across the border can be facilitated without an unnecessary compromise of our integrity.

The concerns we have are highlighted in the letter. I will not stick to the exact wording of our letter, but I refer you to the letter to see the specific points. Also, we have during the break taken the liberty of drafting specific proposed amendments and showing the wording we would use. I am prepared to read that into the record in a moment. We will have that typed up and we'll have it to you by this afternoon, because I think it could be of use in a clause-by-clause or in your analysis of what we see would fix the bill.

The Chairman: Given the shortness of time, maybe if you were just to speak to them and then, as you say, you could distribute the actual technical wording to everybody—

Mr. Michael Greene: Okay.

The Chairman: We're not going to do clause-by-clause until the week after the break, so we'll have time to look at it.

Mr. Michael Greene: You'll be able to see from our suggested changes that we think the problems can be remedied, but that's not to say they don't make a substantial change. So let me talk about how that works.

At the present time, if you approach a preclearance area you do it on the basis of you want to travel to the United States, so you agree to submit to custom searches, to examination, to answer all their questions. And that means to let them go through your goods and to let them go through you if they want to, to make sure you comply for entry. And they need to do that; there's no doubt they need to do that, and it wouldn't work if they couldn't do that. It's the framework of how you make that work.

What we're saying is you're on Canadian soil. It is different from a land crossing; you are still in Canada. At the land crossings they take great pains at the present time to be on American soil to do their thing, because American law applies there; Canadian constitutional remedies don't apply. The American constitutional remedies do apply, which is a major distinction. But when you do it at a preclearance area, you're on Canadian soil.

What we're saying is that you should have a right to walk away from that inspection. If you don't like the way you're being treated, if you think the officer is being rude, that the whole process is intrusive, that you don't like the accusations that are being made against you, you can say “I don't want to travel to your country. I'm going to turn around and walk away.”

Now, there may be consequences as a result of that. You may have information entered in the computer. If they think you've lied, you may be inadmissible to the United States as a result of that. But at least you can walk away.

If there is a Canadian offence that is suspected you can be detained by a Canadian officer. There is a gap there, because you can't be detained by the American officer at the present time. We support clause 24, which would allow the detention of a person on reasonable grounds to believe they've committed an offence, a Canadian offence.

So we say the drug trafficker, the suspected terrorist, is going to get caught by that. Let the Americans detain under clause 24 and turn the person over to a Canadian officer; then you won't have the weak link that DFAIT is concerned about here. But the person should still be able to withdraw because they are on Canadian soil.

What's wrong with this bill is it takes away that right to withdraw. Although clause 10 purports to give you a right to withdraw if you read the subclause of clause 10, it's clear that the officer can detain you on mere suspicion that you violated a Canadian offence. And the framework for what they've done is they've created Canadian offences for misleading a foreign officer or for resisting or obstructing. That's what clauses 33 and 34 do: they create Canadian offences for misleading, obstructing, or resisting a foreign officer who is enforcing their foreign civil laws.

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That's what we find objectionable. We do not think it's necessary to create Canadian offences for this preclearance facility to work. Our friends at ATAC and the Department of Foreign Affairs are saying no, it's absolutely fundamental to the legislation that you have that. We don't think it's there. They say that will make it correspond to what happens at the land crossings. With respect, I don't think it does. They're saying what we want to do is duplicate what happens at the land crossings. This doesn't duplicate it. It creates a different system. It creates Canadian offences. If you go to a land crossing and you lie to a U.S. officer, you don't commit a Canadian offence, but that's what we're going to create here under the preclearance.

Mrs. Sheila Finestone: Under clause 34?

Mr. Michael Greene: Under clauses 33 and 34 there are Canadian offences created.

I think this is quite significant. I'm not aware of any other law in Canada that does this, that creates a Canadian offence for misrepresenting or misleading or resisting a foreign officer enforcing foreign law. That's the concern we see. This is a huge step we're taking. Do we really need to take that big a step? We're saying this framework can work without those Canadian offences.

That is, I'd say, the main thrust of our submissions: get rid of the Canadian offences. You can still cover yourself so you're not creating a weak link in the system. Remember, it doesn't duplicate it if it creates those Canadian offences, because it creates a different situation.

I'll give you another analogy. We let foreign visa offices operate consulates and embassies on Canadian soil. We let them issue visas. It does facilitate the movement of people in particular. You don't create any Canadian offences if you lie to them. You may suffer consequences in dealing with that country. If you present a fraudulent document you may be committing a Canadian criminal offence. So for the person who goes in with a false passport or forged document to the U.S. preclearance area we're saying you don't need to create a separate offence; you already have a criminal offence for that, for using a forged document. It's already there. Use clause 24. That person can be detained under clause 24, turned over to a Canadian peace officer forthwith, and that peace officer can decide whether to enforce the law.

In the same way, if you have say a suspected drug smuggler, we're saying use the test in clause 24, which is reasonable grounds to believe an offence has been committed, and if they form that reasonable grounds, call in the Mounties or the local police or whoever. They can enforce the Canadian law, because that is an offence. We are not going to be letting terrorists and drug smugglers off the hook because we don't create Canadian offences here. There will not be a weak link in the chain.

I read the ATAC brief, and it says it will be an easy access for criminals and terrorists. It's not going to be, because for one thing you have those remedies, that they could be turned over to Canadian peace officers. The other thing is if, let's say, it's a suspected terrorist the Americans want to get their hands on, all they have to do is let them on the plane and meet them when they enter if they want to. Then they can get them if they really want their hands on that person that badly. But they can do it using clause 24. So we're saying with the wording you'll see we're suggesting, take clause 10, and make it clear there's a right to withdraw. Just delete the second half of clause 10. We're saying delete clauses 33 and 34, which are the offence clauses.

In our original brief you'll see we made a major objection to clause 33 for a number of reasons that are no longer relevant because they tightened up that wording quite a bit. We didn't make a major attack on the wording of clause 34, but I will now. I'll say that if you're going to leave those offence clauses in, there is no justifiable reason for making clause 34 different from clause 33. That is, clause 33 has been changed now. It's only a summary conviction offence punishable by fine. Under clause 34 they left it as is; it can be punished by indictment and you can get a prison sentence. I don't see any reason, any justification, if you are leaving those offence clauses for leaving that particular wording in. They should both be summary conviction offences.

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Our friends at the Department of Foreign Affairs say “We don't really intend to pursue this vigorously. We just had to create a mechanism here so they could do their detentions and their searches, etc. That's why we put those Canadian offence sections in.” If that's the reason, then make them as weak as possible if you're not really intending to prosecute people.

I have a feeling that if we have those sections there they will get used—that's the way laws tend to be. There will be a lot of pressure on us from the Americans to enforce them, and when we choose not to we'll hear about it.

In terms of the other powers, we are saying you can give the powers to conduct searches—that's not difficult. If you accept that if you want to go to the United States you have to submit and use a consent-based model, it's understood you give them the power to conduct searches, including physical searches. Leave it. The wording's fine where it says Canadian officers will be called in. But I think you can do it on the basis of consent. If a person wishes to travel forward and there's reasonable grounds to believe it's necessary to search them, you have a search. That can happen. Just take out the compulsory language and the offences.

Our members tell of people who have had bad experiences at the preclearance areas, but also at the U.S. borders. Part of our concern is when we allow foreign officers to operate on Canadian soil, they're not accountable to any Canadian authority. They take their marching orders from a foreign government. While we can say the Constitution applies and Canadian criminal law applies, we have to remember that operationally the policy, the direction and the laws they enforce are all outside of our country.

For that reason we are concerned about giving what we would see as excessive powers, when we don't have that level of accountability. It just doesn't exist. The wording that has been used in much of this bill comes from the Canadian Customs Act. There's a fundamental difference there. First of all you're protecting the integrity of Canadian soil there, but you're also dealing with customs officers who are reporting to Canadian authorities, and we have far more control over the situation.

If Canadians don't like the way this foreign government is treating them on Canadian soil at preclearance areas—and that is the fundamental difference—they should be able to say “I don't want to proceed with this entry. I'm leaving. I'd like to holiday in Canada”, or whatever.

There are some other concerns that we've raised in the letter. I'll leave them for questions. There are questions about information—privacy issues—and some specifics on detention and thresholds. I'll leave that for questions and cut off my submission here.

The Chairman: Thank you very much. I appreciate that, Mr. Greene.

Is Mr. Elliot going to make the presentation of behalf of ATAC? Obviously, because of the shortness of time, I don't want to try to disturb the way you were going to make your presentation, but we have heard quite a bit of evidence on the issue of the benefits of the system to the airports, the airlines, the industry, and the economic benefits and things like that. Maybe we could focus more this morning on any of the problems that are in the bill in that dimension. But it's up to you entirely.

Mr. Geoffrey Elliot (Executive Vice-President, Air Transport Association of Canada): Mr. Chair, thank you very much. It is our intention to focus on the issues that have been raised by the Canadian Bar Association, primarily because I know those are the most difficult ones for you to address.

In my brief I have a small section that deals with benefits, so I may skip it when we get to it. I know you've heard from the Canadian Airports Council already, and my impression is that their brief focused almost entirely on the importance of preclearance, from an economic and industry point of view.

I'm executive vice-president of the Air Transport Association in Canada. I have to say at the beginning that I'm not a lawyer, but I am accompanied by several members of the legal committee of the Air Transport Association, who are practising lawyers and members of the Canadian Bar Association. Christine Kurrant is corporate counsel for Canadian Airlines, and George Petsikas is corporate counsel for Air Transat. George also happens to be chair of the air and space law section of the Canadian Bar Association. Guy Poppe is corporate counsel for Air Canada.

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As you know, the Canadian transport industry strongly supports Bill S-22, and there's no difference of view among the Canadian carrier community. The bill is important. We believe it needs to be acted on as soon as possible, and we respectfully urge you to get on with it.

I'll come back to the business and economic reasons for supporting the bill in a moment, but as I said, the immigration section of the Canadian Bar Association has raised a number of concerns on behalf of the CBA about Bill S-22 today and at their earlier appearance before the Senate. That's what I want to address this morning.

We understand the basis for the immigration section concerns, but frankly we don't agree with them. My purpose today is to explain why ATAC and the legal community involved in aviation law have a different view.

The main thrust of the CBA concerns—and you heard it this morning—is that Bill S-22 represents an intrusion upon Canadian sovereignty, as it allows the U.S. to have powers to enforce their laws on Canadian soil. We believe that assertion is misleading because Canadian law will remain supreme in the preclearance area of airports. Only Canada will enforce criminal law, and the agreement with the United States is fully reciprocal. Canadian officials will have similar powers in the United States, at such time as Canada exercises its right to have preclearance stations in the U.S. While that may not happen soon in the air mode, I understand there are developments afoot in that area.

The drafters of Bill S-22 and Canadian preclearance negotiators with the United States had a very difficult challenge. They had to square or balance the legitimate need of the American authorities to protect the integrity of the U.S. border control system, with the fact that U.S. inspection officers happen to be on Canadian soil when they perform their duties at Canadian airports. That was not an easy task. No doubt it required compromises, but ATAC believes the negotiators and the legal drafters did a first-class job.

The nub of the CBA argument is that because the inspection process takes place in Canada before a passenger boards the aircraft for a transborder flight, the passenger should be treated differently from the same person who presents himself to a U.S. inspection officer at a land border crossing or at a post-clearance point at a U.S. airport.

The CBA position asserts that U.S. officers whose job it is to enforce U.S. customs and immigration laws would somehow intrude upon Canadian sovereignty, if they were permitted under Canadian law to apply an enforcement standard at Canadian airport preclearance stations that is equivalent to—not necessarily identical to—the enforcement standard that applies at U.S. inspection stations and at Canada Customs and other border crossings.

Put another way, the implication of the CBA position is that Canada should insist that the U.S. accept a lower border control standard for people who choose to seek entry to the U.S. by air from Canada, compared to those who travel to the United States by train, bus or car because in all of those cases, inspection would of course take place in the United States.

The fact is that at a land border crossing, U.S. enforcement authorities have always been free to apply the full extent of U.S. law to detain, search, seize, prosecute, fine, imprison or expel from the United States any individual who presents himself for entry, including Canadians. Canadians who enter the U.S. at a land border crossing do not have an automatic right to simply change their minds and walk back across the border into Canada if the questions are too intrusive, or they believe a U.S. customs officer has reason to suspect they have committed an offence under U.S. law. Incidentally, the same is true of Americans heading north across the border to Canada. Once they encounter a Canadian inspection officer, they are subject to the full application of Canadian law. They don't have the right to walk back across the bridge.

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The reality is that the willingness of the U.S. government to station inspection officers at Canadian airports so that travellers are able to secure their entry to the United States in Canada prior to boarding an aircraft is an obvious benefit and convenience to travellers. For passengers, U.S. preclearance eliminates the need for inspection after arrival at busy U.S. gateway airports. Preclearance facilitates onward connections as a result of the ability of transborder flights to proceed directly to domestic gates at U.S. airports and with passengers' luggage already checked through to final destinations. Here I'm not talking about economic benefits to airlines; I'm talking about benefits to passengers.

Preclearance also permits the full use of open skies to provide non-stop flights from Canada to U.S. domestic airports that do not have facilities for customs and immigration inspection. As a result, many Canadian scheduled and charter carriers are able to provide non-stop services to scores of U.S. destinations that would otherwise be unavailable. That may be good for the airlines, but it also benefits millions of Canadians who take advantage of it every year.

Even so, the CBA brief argues that the U.S. government should be required to accept a lower standard of border control and thereby a lower level of enforcement of its laws and a greater amount of risk as a price for providing that convenience to Canadians at Canadian airports. We believe the CBA insistence on the U.S. accepting a higher level of border control risk at Canadian airports would be unacceptable to the United States for good and sustainable reasons. We therefore submit that adoption of the amendments proposed by the CBA would be most likely prejudicial to the whole concept of U.S. preclearance at Canadian airports.

Now I'm going to turn to the specific recommendations that were included in the latest submission by the CBA. The first one relates to extending to officers of a foreign government the power to enforce foreign preclearance laws in Canada. The CBA makes the point that this is an intrusion into Canadian sovereignty.

As I said before, the work of a U.S. preclearance officer is to apply U.S. law and U.S. standards with respect to border control. Bill S-22 does not extend rights to U.S. officers to go marauding across Canadian airports, subjecting people to U.S. law. In fact, Bill S-22 codifies and limits U.S. inspection powers and constrains the exercise of those powers to precisely defined areas at designated Canadian airports.

The only Canadians that U.S. inspectors encounter are those passengers voluntarily seeking entry to the United States as the last thing they do before they board an aircraft. For the CBA to suggest that the U.S. should be persuaded to accept a lower standard of border control for preclearance passengers at Canadian airports than applies at other border crossings we believe is unrealistic.

We also believe Bill S-22 protects the legal rights of Canadians in those circumstances. Protecting the legal rights of Canadians—and, by extension, citizens of foreign countries passing through Canadian airports—is of course an important and delicate consideration. We're convinced that Canadian preclearance negotiators were extremely careful and prudent both in their negotiations with the United States and in the drafting of the legislation. The Preclearance Act will in fact safeguard rights under Canadian law for persons entering the United States via Canadian airports.

The Charter of Rights and Freedoms and all Canadian laws will continue to apply in the preclearance area. Application of Canadian criminal law and penalties will compensate for the inability of U.S. inspectors to apply U.S. criminal law at Canadian airports. Law enforcement within the preclearance areas will be provided by Canadian police officers. Only Canadians will pursue criminal prosecutions, under Canadian law and in Canadian courts. In the event that strip searches are required—and that has been an area of controversy in the past—these will be conducted only by Canadian law enforcement officers and only on grounds that are consistent with Canadian law.

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The CBA believes that persons undergoing inspection should have the right to withdraw from the inspection process at any time. We don't agree with that. As I said before, that right to walk away is not available to bus, train, or automobile travellers at land crossing points, who may, in addition, find their means of transportation seized and impounded.

In fact, at airport preclearance zones Canadians would retain the right to change their minds about entering the United States and to walk away from the preclearance zone until such time as a U.S. officer has reasonable grounds for suspicion of an offence.

Adoption of the CBA “walk away at any time” position would result in a lower standard of U.S. inspection at Canadian airports than at land crossings or at U.S. post-clearance airports and would thus make Canadian airports a more attractive entry point to the United States for criminal elements and other undesirables. Not only would this lower standard likely be unacceptable to the U.S. authorities, but it would also result in an unacceptable increase in security risks at affected Canadian airports as those elements in society discover that this is the weak link.

In respect of the right to levy fines and seize property, we believe that's a universal component of border control administration, law, and practice, and should be allowed also to the U.S. authorities when they administer their entry laws at preclearance points. Again, these are normal powers of customs authorities the world over, to combat smuggling, organized crime, and to deal with contraband. To deny those powers would undermine the integrity of U.S. border control at Canadian airports and would not be acceptable to the United States.

Absence of power to levy fines and to seize property would also create a dual standard between land crossings and airport preclearance, with a distinctly lower level of risk for the criminal who selects entry to the U.S. via a Canadian airport. This would not be acceptable to the United States and would be a bad policy for Canada for the same reasons I've already mentioned.

Another point raised by the CBA is related to the ability to use as much force as necessary to detain suspected criminals. We do not object in principle to the CBA proposal to insert the word “reasonably” before “necessary” in subclause 12(1), but we're not sure this adds anything, because we believe it is in any event implicit that U.S. officers would not be authorized by the legislation to use force unreasonably.

Mr. Greene mentioned the test for search. We believe the test for search should be based on “suspicion on reasonable grounds,” and not on “belief on reasonable grounds,” as proposed by Mr. Greene.

Again, the CBA is demanding a dual standard. It would be unreasonable to argue that the U.S. authorities should have to accept the higher test of “reasonable belief” in respect of persons seeking entry to the United States than the standard of “reasonable suspicion” when that lower threshold for search is in fact applied under Canadian law by Canadian customs officials in respect of persons entering Canada.

The CBA also expresses concern about passenger information and potential abuse of privacy. That's a much broader issue. Inspection authorities in the United States, Canada, and around the world are seeking access to advance passenger information so they can identify potential areas of risk in advance and allocate diminishing border control resources to the highest risks. The information eventually becomes available anyway at the time of inspection through direct questioning of the passenger.

Passenger information in the context of Bill S-22 does not apply to Canadians who are simply crossing the border into the United States. It will only be provided with respect to in-transit passengers arriving from a third country en route to the United States, so that U.S. inspection agents at Canadian airports have some advance information of who is arriving. Prior to that, they had the comfort of knowing that all passengers had previously cleared Canadian customs and immigration, so the risk was therefore less.

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The CBA opposes making it an offence under Canadian law to resist or mislead a U.S. inspection officer. Mr. Greene mentioned that again this morning. There is a need to create a basis on which to trigger the availability of other powers to the U.S. inspection officer. A false statement could be considered an offence only if it is relevant to the entry of the person and goods to the United States. However, lies and false utterances at the time of questioning by an inspection officer may provide the necessary grounds for reasonable suspicion that an offence has been committed, thus triggering the potential use of other powers of search, seizure, and detention, pending the availability of a Canadian law enforcement officer. Incidentally, it is also an offence under Canadian law to make a false statement to a Canadian customs officer. So there is nothing new about this.

While I have a section, Mr. Chair—and I know that you're short of time—in which I deal with why the passage of the Preclearance Act is important to the industry, it's in the brief, which I know all of you have, so I'm quite happy to dispense with going through that.

The Chairman: We can stop there, because we're going to lose our members, and I know the members do want to ask some questions.

[Translation]

Mrs. Sheila Finestone: May I ask him if their level of protection and verification is lower or higher than Canada's?

[English]

Thank you very much for your presentations. I found this whole thing very interesting. And I must say, for the first time I understand this bill a little bit better. I don't know who's right and who's wrong, and it doesn't matter. I'm going to study it myself. But I do appreciate the presentation, and I like the term “reasonably” instead of “as much force as is necessary” in subclause 12(1). I can tell you that right now.

I have a great interest in privacy and the rights of privacy, and I will review that personally and get some information about it. If it's there as a concern, I want to know about that. We have enough ways to lose our personal and private information as it is in this world.

I do want to know why, Mr. Elliot, you seem to infer—and I might have misunderstood—that American law is higher in quality or higher in its level or its yardstick than Canadian law, or vice versa. That's my first question.

Secondly, you are not concerned at all about the issue that was raised about clauses 32, 33, and 34. Do you feel they're not relevant?

And lastly, when is the American law that is supposed to mirror this law supposed to come into effect? Was it presented yet to Congress? This being an electoral year, do you think the American Congress is going to think about this law and put it through?

I got an underlying sense—and I hope I'm wrong—of a threat that if we don't pass it as is, then we lose the opportunity to have what is an important and necessary undertaking: the preclearance. I found that very discomforting. I don't like to be threatened that if we don't do it, the big brother next door is not going to accept any changes. Well, I'm sorry, we do have a Canadian law. If it's a higher or lower bar, I want to know. And we do have the right, as a sovereign country, to express a position and a concern. If it's seen as right by the parliamentarians and by the executive office, then I think it should be acceptable to Canadians.

So I want to know when and where the American law is. When is it on the books? I believe you have to have another law in the United States. Second is the privacy issue, and third, the amendments.

Thank you very much. And I'm really sorry, but you were supposed to be—

The Chairman: Don't leave before you hear the answer.

Mrs. Sheila Finestone: I might. I'll read it in Hansard.

The Chairman: They don't publish our committee meetings in Hansard any more.

Mr. Geoffrey Elliot: I'll respond, Mr. Chair, and I'll invite my legal colleagues to contribute to any failings in my answer.

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First of all, I was not saying that U.S. laws are a higher standard than Canadian laws. What I was saying was that the U.S. standard of enforcement at land border crossings would be higher than the standard of enforcement at Canadian airports should the amendments proposed by the CBA be accepted. The point of that is that the U.S. authorities, for good reason, would not wish to create a weak link in the border control entry to the United States at Canadian airports.

Mrs. Sheila Finestone: Does that mean both of them are exactly equivalent right now and are interchangeable?

Mr. Geoffrey Elliot: I think you would have to consult with the Canadian Department of Justice officials for an assessment of that. But at the moment, my understanding is that there is no legal codification of what U.S. customs offices do at Canadian preclearance stations, in which case there is the potential that what they do could be challenged under Canadian law. This bill is designed to rectify that situation in part.

It's not that U.S. laws are of a higher standard for border control than Canada's. It's the need for the ability of the U.S. to enforce its law with a standard in Canada equivalent to what applies in the United States when they're enforcing the same laws. And while they are not enforcing U.S. criminal law at Canadian airports, the trade-off provided under this act is the ability to apply Canadian criminal law in those circumstances where there is an offence. Triggering that is based on the ability of the U.S. inspection agents to engage in search, seizure, and detention activities when they have reasonable grounds to suspect that a person applying has committed an offence.

Mr. Deepak Obhrai: Madam Finestone, this is a very legal question you asked, and it should be answered by the justice committee, not by Mr. Elliot, who is not a lawyer. I know what you're saying.

Mrs. Sheila Finestone: [Inaudible—Editor].

Mr. Deepak Obhrai: But it should come from the justice committee, I think. She has a very good point. She's going on a very strong legal issue, but I think it has to come—

Mrs. Sheila Finestone: I really want to know what its impact is in the bill, and it doesn't matter who gives the answer, if you know what I mean.

Mr. Deepak Obhrai: I would still say that this is for the record here.

Mrs. Sheila Finestone: Yes.

[Translation]

Mr. Daniel Turp: I find that a good question.

Mrs. Sheila Finestone: Thank you very much. All the better.

[English]

The Chairman: It's not for the justice committee to deal with. We have to decide whether we're going to adopt this bill or not. The justice committee has nothing to do with this, and we're not going to bring them into it, either.

Mr. Deepak Obhrai: I meant the justice department.

The Chairman: Well, believe me, I trust that there will be somebody from the department here listening to this who will be able to address these issues when it comes up for clause-by-clause, because these clearly are issues.

As you see, Mr. Elliot has legal counsel there, and he's just going to give his opinion.

Mr. Geoffrey Elliot: There were some other components to Madam Finestone's question. One was are we doing this under threat from the United States? Well, again, there were I think—

Mrs. Sheila Finestone: I didn't say under threat. You had the threat. I didn't say the U.S. threatened. You threatened.

Mr. Geoffrey Elliott: I threatened?

Mrs. Sheila Finestone: I think in the way you presented the observation.... You said if we do anything to change the bill as it presently stands, it will be lost and gone, because the United States won't accept any changes.

Mr. Geoffrey Elliott: I didn't say that.

Mrs. Sheila Finestone: Yes, you did. And the Hansard will show that. That was the reason for my question. Where is it in the United States? Is the bill drafted? Have you seen the mirror image of this bill? Do you know whether or not they'll accept it? At what point is it in the pipeline?

Mr. Geoffrey Elliott: Again, I think you should address that question to Canadian officials. I'm not even sure whether the U.S. requires legislation in order to implement the provisions of the preclearance agreement.

Mrs. Sheila Finestone: I believe they do. Anyway—

Mr. Geoffrey Elliott: I don't know the answer to that.

I thought you were asking whether there would be a threat of the U.S. moving out of preclearance in Canada if the bill were not passed in the present form. I don't think I said that precisely. But certainly the Preclearance Act defines the circumstances under which U.S. officials are permitted to do their job in Canada, and if Canada is not prepared to agree to circumstances—regardless of the precise wording of the bill—that will enable U.S. enforcement officers to do their job with a reasonable level of equivalence as to the quality of their border control at Canadian airports compared with the quality of their border control at other entry points, then yes, there will be a substantial risk that the existence of preclearance operations in Canada would be at risk. But this bill is designed to deal with that.

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Mrs. Sheila Finestone: Thank you very much.

The Chairman: Thank you.

Next is Mr. Obhrai and then Mr. Turp.

Mr. Deepak Obhrai: Thank you for your submission.

Before I go to Mr. Greene, I just would like to comment to Mr. Elliot that the issues raised by Mrs. Finestone are legal issues and for you to go into that regarding the official of the department is quite risky, I would say. She has brought up a lot of legal questions.

My question is for Mr. Greene. Mr. Greene, before you started your presentation you made a statement I think I would not agree with. You said you represent people crossing the border from both sides. I would venture to suggest that you don't represent people crossing both sides. You definitely don't represent me, I mean to say. You're putting your representation on the basis of your position as being from the Canadian Bar Association.

That in turn brings me to another point. You have members from your bar association on this side, and you're a member of the bar association on that side. So I do not really know how much—

Mrs. Sheila Finestone: And never the twain shall meet. It's great.

Mr. Deepak Obhrai: Let me finish, Mrs. Finestone.

I don't know how many of your own members are in agreement with your submission. But based on your submission here, I have a question, because I find it a little problematic that in your brief you say that it should be a voluntary measure. Perhaps you can give that opinion. But if the U.S. government and the Canadian government are going to pour in a lot of money and open up their borders, I think the voluntary method would totally not be a workable solution.

That brings me back to this issue. This bill has a tremendous amount of economic impact and convenience for the Canadian public. As such, your statement that the U.S. can let people go in and arrest them when they land in the U.S.A. defeats the major purpose as to why this bill is here, which is to create a faster flow that is advantageous not only to the airline industry but also to the Canadian public.

So there are these two points coming in.

You have raised one point, which I can't comment much on, but you did. You said that clause 33 was amended and clause 34 wasn't, so there is some kind of contradiction there. I'll agree that “reasonable” seems to be an appropriate word.

Perhaps you can comment on those.

Mr. Michael Greene: Sure. Perhaps I can just address your various points.

First of all, when I said that we represent people going both ways, what I was saying is that immigration lawyers tend to represent people going in both directions. That's all I'm saying. A lot of my practice, for instance, is representing business clients who have to take business trips to the U.S. So we often have to deal with these things.

In terms of whether or not the voluntary system is workable, I will tell you that it has been working for 40 years without any legislative authority whatsoever. It has been working reasonably well and well enough that the Americans have been quite happy to be here. Some issues came up, and the desire to extend it to in-transit is what precipitated the legislation. But it can work on a voluntary basis quite effectively, and it has in the past.

The Chairman: Mr. Greene, did you say 40 years?

Mr. Michael Greene: Since the 1950s they've been operating preclearance areas in Canada.

With regard to this issue that they would close their facilities down if they didn't have these powers, they haven't had them for 40 years and they haven't closed them down. So I don't think the fact that we don't give them to them now is going to cause them to do that. Yes, it is a benefit to Canadian travellers to have this, but it is also a tremendous benefit to the United States to operate preclearance outside of the U.S.

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I've spoken to a number of U.S. immigration authorities on this. It is a real benefit to them to do it, and it's partly because of the funnel effect. They can operate say 10 preclearance areas in Canada, and then those people can funnel to airports all over the U.S. They don't have to put up their U.S. customs and immigration facilities at 50 different airports in the U.S. They can do it at 10 different places in Canada. It's a huge benefit. There's no way they're going to shut them down if we take out the Canadian offence provisions. I find it very difficult to believe that would have that effect.

You made a comment about the Canadian Bar Association. I'll just tell you how this happened. We were contacted. In fact, when the foreign affairs department spoke before the Senate, they were asked if there had been any opposition to this bill. The person presenting said this is a bit like asking a pitcher who has a no-hitter going if there are any problems. He said no, we've given this to immigration lawyers, and the bar is usually vocal on this, and they haven't said anything.

With respect, we hadn't seen it at that point. The analogy is more like when you have a no-hitter going and you haven't told the other team there's a baseball game happening. We didn't know about it till the last minute. We found out about it a week before we appeared before the Senate. We were very concerned about it. I think my colleagues in the Air Transport Association knew, but they didn't inform the CBA. We had no idea this was happening.

We did a brief. It was circulated to the legislation and law reform committee of the CBA, which represents the entire CBA, not just the immigration section. The members of that committee come from throughout the CBA. They approved it. In fact they strengthened some of the wording in what we were saying. Then it went to the CBA executive, who also read and approved it.

Now, there are members here who are members of the CBA. They're not appearing in a CBA capacity. There are members on both sides of the House of Commons who are members of the CBA. Just because they are members of the CBA doesn't mean you know where the CBA stands on specific positions. We do take positions. We are concerned about this, and that's the position we have.

As I've said, we do have common interests here. My colleagues here from the air section support the idea of having legislation. We do too. We have that much in common.

I don't know if that answers all of your questions.

The Chairman: Mr. Greene, without getting into the CBA politics of this thing, you are speaking for the immigration committee of the CBA. You're not speaking for the entire CBA. Otherwise, this would have to go through the trade committee and the air transport committee of the CBA, and then you'd have to have a Canadian Bar Association coordinated response. You're speaking exclusively for the subcommittee you represent, aren't you?

Ms. Joan Bercovich: Yes, and I can explain the process. The immigration law section of the CBA prepared this submission. The approval process happens at various levels within the association. First, it's within the immigration law section itself, which has an executive of 20 members, all of whom had the benefit of reviewing the submission and circulating it within their own constituencies in all the various provinces and territories across the country that have CBA sections on immigration law, which is all of them.

Once it is approved by that very large group as a statement of the immigration law section, it then goes to what we call the legislation and law reform committee, which is a standing committee of the CBA consisting of six people. The mandate of that committee is to look at the submission and assess it against CBA's standards so that it's not inconsistent with previous CBA policy and it meets the standard of the CBA. They bring a very rigorous point of view to the submissions. As Michael mentioned, most of the time that committee tones down the submissions we would bring to House or Senate committees. In this case that committee actually toned it up. That committee then makes a recommendation to the executive of the CBA, which consists of the past-president, president, treasurer, and—sorry, I've forgotten the last position—and they approve it as a policy statement of the immigration law section.

The Chairman: Thanks. So it has gone through more than just one section.

Mr. Deepak Obhrai: My other question was in reference to clauses 33 and 34.

Mr. Michael Greene: Sorry, I didn't answer the question on clauses 33 and 34. Did you want—

The Chairman: You wanted to say something about the CBA process, Mr. Petsikas. Let's deal with this so that everybody understands what's going on here.

[Translation]

Mr. George Petsikas (Air Transport Association of Canada): Mr. Chairman, I agree that this isn't the time to get into a debate concerning the internal procedures of the Canadian Bar Association. However, as you know, I am the President of the Air and Space Section of the Canadian Bar Association and I must say that some of our lawyer members also work for air transporters and that is normal. So we have a clear interest in this matter but we were never consulted by the Canadian Bar Association on this matter.

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I believe the distinction you have just made is correct. What you have before you is the position presented to the Canadian Bar Association Council.

We are here as members of the Canadian aviation community but it must be said, for the record, that this is not a unanimous opinion coming from the Canadian Bar Association.

[English]

The Chairman: Ms. Bercovich has made it very clear that it's coming from the immigration section and this is the normal process. It goes through the Bar Association and it's been vetted through the process. So we understand the process.

[Translation]

Mr. Daniel Turp: I could add that your section could have done exactly the same thing as immigration and that was not done, if I've understood this correctly.

Mr. George Petsikas: It's true, but for that we would have had to be formally put on notice and consulted by the mechanism within the Canadian Bar Association here, in Ottawa. There's a central unit organizing these activities. We were never given the opportunity to express ourselves on the pretext that there was not enough time to consult us. What can I say?

[English]

The Chairman: Let's go back then to the problem of the distinction between clauses 33 and 34. Was that addressed to Mr. Greene?

Mr. Deepak Obhrai: I think he alluded to that point. There was some discussion.

Mr. Michael Greene: We lost a little bit in the shuffle there.

Are you asking what the reason is for amending clause 34 to make it look like clause 33?

Mr. Deepak Obhrai: No. If I read your letter correctly, you were concerned that the government had modified clause 33 to make it a summary conviction offence, but it did not do so in clause 34.

Mr. Michael Greene: Right.

Mr. Deepak Obhrai: So am I to presume that under clause 34 it's still a criminal offence?

Mr. Michael Greene: Yes, it looks to us like it is a criminal offence.

Mr. Deepak Obhrai: Can you give me an idea where the conflict is coming? Where is the conflict between clauses 33 and 34? Are we talking of two separate issues here?

Mr. Michael Greene: When we saw the way clause 33 was worded with respect to a number of points, including how widely the misrepresentation clause was worded, we said there were a number of things wrong with this clause, including the question of why we were creating indictable offences, criminal offences for not complying with foreign law. So what they did was they changed clause 33, and no change was made to clause 34. I think it was an oversight, but I'm not sure.

Perhaps they have a good reason, but the offences are more or less.... It should be on the same footing if they are going to remain. There's no reason they shouldn't both be summary conviction offences that are not criminal offences. If you look at the subclauses in clause 33, they make it clear it's not a criminal offence, but they didn't do that with clause 34 when they amended the bill.

The Chairman: Can I help this along a bit?

Mr. Deepak Obhrai: Yes, go ahead.

The Chairman: It seems to me that you have a valid point in one sense. Why would you make a distinction? One clause says it's an offence if you make an oral or written statement to a peace officer for preclearance, so they said they're going to make that a summary conviction offence, rather than an indictable offence. Okay, you made an oral declaration that's wrong. The other clause says that if you resist or wilfully obstruct a preclearance officer in the execution of the officer's duty.... It may well be that there is an inherent logic in differentiating the nature of those two acts. One is you set something down on a piece of paper, and you give it to them, etc. The other one is you're wilfully obstructing the person in the execution of their act. There seems to me a qualitative difference in the nature of those two offences that might justify a higher penalty in one than the other.

I take it you're telling me that in your view it doesn't, but I don't think you disagree with me that there is a difference in the nature of the conduct that is being expressed.

Mr. Michael Greene: They are different offences.

We think you could actually roll them into one offence. If you're going to leave them there, just roll them into one offence, because they are of the same nature. Misleading...that could be pretending you're someone you're not. You could be a terrorist pretending you're not a terrorist. You could be presenting false documents, for instance. I don't know that I'd say that “resisting” is any more serious. Anyway, we'll leave that to the foreign affairs department.

Our view is that we don't want these clauses at all. We don't think we need that.

The Chairman: I thought it was coming to that.

Mr. Michael Greene: If you're going to leave them in, make them compatible. There's no reason for us to have criminal offences for summary convictions.

Mr. Deepak Obhrai: Yes, you actually answered that question, so thank you very much.

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Mr. Michael Greene: I can give you a little bit of information on the reciprocity question that was asked by Senator Finestone. And she asked what stage is the U.S. at on this. The U.S. does have a provision that says if a foreign government grants them preclearance powers, they can institute reciprocal powers. They would have to create legislation to do that.

It's our view that there is no reciprocity. In fact, this is a one-way street at the present time. It might change in the future, but let's remember it is right now a one-way street. There is no preclearance happening. Canada isn't doing preclearance anywhere else. It's only being done in Canada by the U.S., in terms of our relationship with the United States.

If you look at our brief, we deal with the reciprocity issue. They're saying there is reciprocal legislation in the U.S., but it is clearly not the same as this legislation. There would clearly need to be more legislation. I really seriously question with this Congress whether they would be willing to do that, but that's another matter.

The Chairman: It's an interesting observation.

Mr. Turp.

[Translation]

Mr. Daniel Turp: Thank you, Mr. Chairman. That was one of my concerns and I'll probably have another question on that but I'd first like to thank the witnesses.

This morning, we witnessed a good example of a debate between witnesses. That does cast a bright light for the committee's future work and we appreciate it very much. During the examination of a bill like this one, which limits sovereignty or at least grants jurisdiction to another State over one's territory, which is quite exceptional, we must make sure that the exercise of the jurisdictions of this other State over one's territory does not contravene the broader aspect of legislation and does not limit the scope of that legislation abusively.

My first question has to do with the Canadian Charter. In the Canadian Bar Association's brief, it says several times that with the present wording, there are many provisions contradicting the Charter that might conceivably be found inoperative by a Canadian court.

I'd like you to indicate if, in your opinion, there are provisions in this bill contrary to the Charter that could be declared unconstitutional were they to be questioned before the courts. That's my first question. If you don't mind, I'll ask them all together.

On reciprocity, is it a problem that there is no reciprocity in the present state of affairs? Do you think we should consent to this limitation of jurisdiction over the Canadian territory only if there is, in the treaty following up on this legislation, a formal commitment of the same nature from the other government? This would mean that there would be an obligation to pass similar legislation when Canada wanted to get, in the USA, a preclearance right equivalent to the one it would recognize in its legislation.

My third question has to do with an element that you have raised and that I find quite interesting. You say that clause 4 shouldn't use the expression "right of preclearance". It's true that, through that legislation, we're giving a right to the USA; we're giving the American government and its officials a right. It's far more than authorizing the exercise of some jurisdiction on Canadian territory. Do you think it's appropriate to create a right? And if we shouldn't create a right, how should the provision in clause 4 be worded?

One last thing, Mr. Chairman. You suggest abrogating a specific provision in clause 28. You suggest the simple abrogation of the provision on confiscating goods seized in Canada that would be allowed by clause 28. I'd like you to explain why you wish for the abrogation not only of clauses 33 and 34, but also 28.

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Mr. Graham and I teach international law and we just adore debates like this one.

The Chairman: Up to a certain point. I also adore having lunch.

Mr. Daniel Turp: Be patient, Mr. Chairman.

[English]

Mr. Michael Greene: Perhaps I can address them in order.

With respect to the Canadian Charter of Rights and Freedoms, at the present time if a Canadian peace officer stops you on the street and wants to search you, that peace officer cannot search you unless he has reasonable grounds to believe you have committed an offence and you have some evidence on your person. In fact, there has to be more than that. A peace officer has to get a warrant in most cases out of our courts.

In section 8 of the Canadian charter we have a right against unreasonable search and seizure, and it's been well litigated in the courts. They can't stop you and say “I suspect you have narcotics in your possession, so I'm going to search you.” They can't even stop you in normal cases and say “I believe you have narcotics” and search you. Often they need to do an arrest and do the search in consequence of an arrest. There is a fairly high standard before we allow the searches.

The Chairman: I don't like to interrupt you, but we were told the other day that a Canadian customs officer could do all of those things.

Mr. Michael Greene: Let me take that another step. I'm talking about a Canadian peace officer.

The Chairman: Let's not pose an argument; a customs officer can do it. It's true if you're walking down Bay Street, but if you're walking into a Canadian customs shed, wherever you're coming from, and they just smell something about you, they have all these powers you don't like.

Mr. Michael Greene: Absolutely, sir; that is correct. Under Canadian law a peace officer doesn't have these powers. We make an exception for the Customs Act. If you're coming into Canadian territory, the Customs Act is what sets a lower standard. It says they can do it if they have reasonable grounds to suspect you've contravened a law.

What's happened here is they've taken the wording of the Customs Act and they've moved it over to the Preclearance Act. They've said “We think we should be able to give American preclearance officers the same powers that our officers have under the Customs Act”.

The Customs Act provisions went to the Supreme Court in the case called Simmons, and the Supreme Court said those powers were constitutional for people coming into Canada. It would be a legitimate reading down of the right to freedom from unreasonable search and seizure.

We are seriously concerned. We questioned whether the courts would take that same interpretation they've applied to our Customs Act and apply it when we're protecting the sovereignty of another nation.

Mr. Daniel Turp: Why not?

Mr. Michael Greene: That's the question. When we're dealing with other countries, would we drop our standards? We apply a very high standard to searches and seizures in all other cases except for customs.

The Chairman: Do you recall the Chemical Weapons Convention, which this committee put through a couple of years ago? Have a look at the search and seizure provisions under the Chemical Weapons Convention for foreign purposes in this country. Anybody, including some United Nations inspectors, can walk into a paint plant and grab anything and say “We think this is a chemical weapon”, and trot you off to jail.

Mr. Michael Greene: With section 1 of the charter you have the right to have reasonable limits that are demonstratively justifiable. And the question is, is that the case here?

We've had this debate with the foreign affairs department and we have met with their people. They believe the Simmons test would uphold this. From a constitutional position we have questioned it, but from a practical position we say it's not necessary.

Mr. Daniel Turp: Why do you say it would not be upheld, just because it's about foreign officers?

Mr. Michael Greene: Because you're acting on mere suspicion; you're doing searches on mere suspicion, as opposed to....

Mr. Daniel Turp: That has been upheld.

Mr. Michael Greene: Yes, because it's foreign law.... Arguably, the reason for Simmons is you're protecting the Canadian territory so that we can enact laws to lower the standard. We want to protect our own territory, because it's our territory to protect. Here we're not; we're doing a favour for them and we are protecting their territory. So we're saying we don't think the courts are going to adopt a lower standard when it's not the Canadian territory that needs to be protected; we're doing a favour for another country. And we could be wrong.

Mr. Daniel Turp: I understand the distinction, but I'm not sure the courts will.

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Mr. Michael Greene: That's the legal position the courts have taken on other search and seizure cases. I admit there are some limits, but they have taken the position of a fairly high standard on search and seizure. So in protecting other legitimate Canadian interests, such as to be free from narcotics trafficking, they still apply a very high standard. We don't know. The debate will go there.

Your question on the reciprocity.... Sorry, I don't want to go too far. It's also the same thing with detention on suspicion. The forfeiture of property is an interesting one because we don't have property rights under our charter. It's an interesting question. I was asked about the forfeiture provisions and why we take the position we do.

The problematic thing about forfeiture is we're allowing another country to seize and keep property on Canadian soil—that's what's happening—and it may not be illegal to have that property in Canada. The U.S. has prohibitions against all kinds of goods manufactured in countries they embargo, but we don't. Cuba is the best example I can think of. A box of Cuban cigars, for instance, is often worth $400 to $500. In Canada you can possess them, but in the U.S. you can't because it's illegal to import them.

We're saying that when you enforce those laws and allow people to seize those things at preclearance centres, you're basically allowing them to expropriate property they wouldn't be able to expropriate in Canada and under provisions that we might find quite offensive, because we do trade with some of those countries and we don't see a problem.

The counter-argument as well is they're trying to import that property into the United States. If they went to a land crossing, they would lose it. But we're not at a land crossing; we're here in Canada. That is the distinction we make. You're here in Canada. That person should be able to—

Mr. Daniel Turp: That's a distinction Mr. Elliot and his colleagues do not think is appropriate.

Mr. Michael Greene: They think it should be exactly the same as it is at the border, but it isn't the same.

Mr. Daniel Turp: Why?

Mr. Michael Greene: Because we're on Canadian soil. We say “We want you to be effective; we want to help you to be effective. But we ask you to compromise to some extent, in terms of which tools you can use in Canada. We don't think you need to use all the tools you have at the land crossing, because some of them don't fit well with our Canadian law.”

Another example is firearms. If you go to a land crossing, those officers have firearms. They carry them on their belt. They have the right to use them. There have been frequent instances of people complaining that when they started to question the officer, they put their hand on their gun. It's maybe an intimidation tool or whatever. But they can't do that here. We don't let them have firearms at the preclearance area.

The Chairman: The police do it.

Mr. Michael Greene: I've heard that so many times I believe it's probably a training thing, but we don't let them have firearms. Are we creating a weak link because we don't let them carry guns? No. That's something about our integrity. We say that's not appropriate.

This is like that. We're saying, with the Canadian offences, that they don't have that one at the border anyway—that's a new one, creating Canadian offences. But with the kinds of powers this bill wants to give them, we're saying there has to be some compromise because they're on Canadian soil. We think it's an acceptable compromise. We do not think they're going to pack up and go home with some of these compromises. It's the same compromise when they can't carry guns. They're quite happy to be here. Let's remember that this system has worked fairly effectively for 40 years without—

[Translation]

The Chairman: Mr. Turp, I'm sorry, but I have an appointment and I'm already 20 minutes late. So I'll give the floor to Mr. Elliott and that will be the end of it.

[English]

Mr. Geoffrey Elliot: I won't be very long. I just wanted to comment on the last part of Mr. Greene's intervention, simply because that really is the nub of the issue. You have to bear in mind the question “Why should the U.S. enforcement officers have equivalent powers in Canada?” The airport has become the border. That's what the agreement does. That is where they have to exercise their control.

As I pointed out, under open skies, Canadian airline carriers fly to destinations in the United States where there is no post-clearance. I don't think it's a satisfactory argument to say the Americans can always post policemen to catch people when they get off the plane. I just don't think it's practical to insist that the U.S. have two levels of border control—one at a preclearance station at an airport in Canada, and another one when people get off the plane, because Canada is not prepared to provide an equivalency in terms of enforcement powers. They're not identical enforcement powers. We've gone through that in the discussion, but they are designed to be equivalent. It's a very fine balance.

• 1230

I think the negotiators of the preclearance agreement and the drafters of the legislation have been sensitive to the concerns Mr. Greene has expressed. I'm not saying there isn't room for fine-tuning of the words—it was never my intention to convey that. But the fundamental solutions that have been negotiated, accepted, and included in the text represent a fine balance, in terms of ensuring the integrity of the U.S. border control system and our interests.

Mr. Daniel Turp: Is it in balance when it comes to reciprocity, though? I'm not convinced the Americans are willing to do the same thing we seem to be doing now. Is that correct?

Mr. Geoffrey Elliot: Yes. Could I address the reciprocity issue in a practical sense, not so much in a de jure sense?

First of all, we've had the theoretical right to have preclearance at U.S. airports, I believe, since the preclearance agreement between Canada and the United States was negotiated in 1974. It's never happened because the economics simply don't justify putting preclearance stations at U.S. airports. There's no interest on the part of airlines in having preclearance at U.S. airports because of the different geography between Canada and the United States.

You can fly directly to all the major points in Canada from the United States, and there is not a lot of flow traffic for transborder travellers behind the gateway, which makes preclearance make sense from an airline point of view. I suspect the real significance of the reciprocity issue will occur later, in the context of initiatives by the customs authorities in both countries to make it more efficient to cross the border at land border points.

I believe the provisions of the Preclearance Act will go a considerable distance toward enabling Mr. Dhaliwal in his portfolio to engage in constructive discussions with his U.S. colleagues on how to achieve those greater efficiencies. In that context, I suspect there will be a very real U.S. interest in ensuring that the reciprocal arrangements are in place. It's not the same in the air mode, but it will be important in the other modes.

The Chairman: We got the impression too, from our other hearings, that this is a precursor to a sort of condominium arrangement at various borders, where they're very active and where you could—

Mr. Daniel Turp: Land border.

The Chairman: Land border crossings. Condominium seems to be a good word to use, where they kind of collaborate with one another. We'll see whether that comes.

Thank you both very much. As Mr. Turp said, it's helpful to have a dialogue or even a debate between you, because it really makes us understand the issues much better.

Mr. Greene, if you could actually prepare the specific amendments you think would be appropriate, we'll circulate them to the members and they'll be available when we do the clause-by-clause. That would be very helpful.

Mr. Michael Greene: We're pretty sure we can do that today.

The Chairman: You don't have to worry about doing it today, because there's a week's break next week. Clause-by-clause will be on May 25, so there's certainly time. But some time prior to May 25 would be helpful.

Mr. Michael Greene: All right. We'll be quite pleased to meet with the Department of Foreign Affairs—we've done it in the past—to discuss it with them, or to appear at clause-by-clause. It wouldn't necessarily be me, but somebody from our department.

The Chairman: Sure. You might want to meet with them to discuss and sort things out in advance. That's always helpful to us and to them.

Thank you very much, everyone, for coming. We appreciate it. Sorry about the vote, but we ended up getting about as much time anyway.

The meeting is adjourned.