FINAL SUBMISSIONS

This briefing consists of final submissions by Howard Mann, Senior International Law Advisor at the International Institute for Sustainable Development, to the House of Commons Standing Committee on International Trade. It provides a legal critique of the Investment Chapter of the Canada-EU Comprehensive Economic and Trade Agreement (CETA), arguing that the draft text significantly expands corporate rights and restricts the ability of Canadian federal and provincial governments to regulate in areas such as health and the environment.

• The Investment Chapter of CETA is described as providing foreign investors in Canada with the most investor-friendly set of corporate rights ever drafted by the Canadian government. This expansion of rights, combined with an investor-to-state dispute settlement mechanism, is expected to increase the number of challenges against federal and provincial government measures, including those concerning human health and the environment.
• The Most Favoured Nation (MFN) provision in the draft agreement is 'fully open and backward looking,' allowing investors to adopt rights from prior investment treaties concluded by Canada. This reverses the approach of the 2004 Canadian Model FIPPA, which applied MFN only on a forward-looking basis to prevent investors from using older, less carefully drafted provisions to bypass modern protections of government regulatory space.
• The Fair and Equitable Treatment (FET) provision is characterized as the most open-ended and unpredictable version ever drafted by a Canadian government. While it includes defined lists of breaches and legitimate expectations, it also includes a third 'box' referring to customary international law without setting thresholds or tests, leaving the scope of the provision to be determined by international arbitration tribunals.
• The proposed 'umbrella clause' from the EU would elevate any specific written obligation a government enters into with an investor to an international law obligation. This would allow investors to bypass domestic courts and move disputes regarding domestic law instruments to an international tribunal.
• CETA changes the process for exceptions to National Treatment and MFN by requiring a complete listing of all existing non-conforming measures, including those at the provincial level. This replaces the previous practice of 'grandfathering' provincial measures used in NAFTA, placing a high burden on provinces where accidental omissions could lead to irreversible challenges by investors.
• The general exception clause (similar to GATT Art. XX) for environment and human health is viewed as insufficient because it imports a strict WTO 'necessity test' that is typically interpreted restrictively against governments. Furthermore, it allows three arbitrators to decide what is necessary for Canada or its provinces without the possibility of appeal.
• The 'right to regulate' clause, intended for the CETA preamble, is argued to actually restrict rather than expand government authority. Because it reaffirms the right to regulate only 'in a manner consistent with the Agreement,' the treaty obligations prevail over the right to regulate, mirroring the legal history of NAFTA Article 1114(1).

APA

MANN, H. (2013). FINAL SUBMISSIONS. International Institute for Sustainable Development. https://www.iisd.org/system/files/publications/CIIT_final_submission_trade.pdf

Chicago

MANN, HOWARD. FINAL SUBMISSIONS. International Institute for Sustainable Development, 2013. https://www.iisd.org/system/files/publications/CIIT_final_submission_trade.pdf.

Wikipedia

{{cite report |last1=MANN |first1=HOWARD |title=FINAL SUBMISSIONS |publisher=International Institute for Sustainable Development |date=5 December 2013 |url=https://www.iisd.org/system/files/publications/CIIT_final_submission_trade.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{mann2013final, author = {MANN, HOWARD}, title = {{FINAL SUBMISSIONS}}, institution = {International Institute for Sustainable Development}, year = {2013}, month = dec, url = {https://www.iisd.org/system/files/publications/CIIT_final_submission_trade.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }