Canada offers EU some concessions

OTTAWA — The Harper government has agreed to smooth the way for more takeovers of Canadian companies by European firms in one of several concessions during free-trade talks, sources tell The Canadian Press.

Canada has also agreed to open up parts of its hydro-electric sector to a limited amount of foreign investment, say sources in Canada with intimate knowledge of the talks.

With Prime Minister Stephen Harper in Europe over the next week hoping to hammer out the remaining barriers to the ambitious deal, sources say Canadian negotiators have agreed to a provision to raise the threshold for reviewing foreign acquisitions from Europe to $1.5 billion.

All acquisitions under that value would not be subject to a government assessment about whether they create a net benefit for Canada.

Just this Monday, the House of Commons passed the budget implementation bill raising the threshold from the current $334 million to $1 billion over the next four years. The new threshold would only apply to private, not state owned firms.

While the concession will be seen as controversial with some in Canada, especially after issues arose over recent foreign acquisitions in the resources sector, Europe is treating the issue as a major climb-down from its starting position of no restrictions.

In return, Europe has apparently gained ground on investor protection dispute settlement rules, meaning the deal calls for few restrictions on the ability of European firms to sue Canadian governments for policies judged unfair to investors.

As well, the current state of the talks has Canada giving Europeans more market access in protected sectors such as telecommunications, which has restrictions on foreign ownership, as well as uranium mining, postal services and insurance.

Overall, the two sides say they will eliminate all industrial tariffs within seven years, a measure that will save Canadian exporters $213 million annually — and European exporters $635 million — at current exchange rates.

Canada has also significantly moved to appease demands for opening up provincial energy utilities, affecting mostly those in Ontario and Quebec, in procurement of goods and services.

Documents obtained by a Quebec civil society network, the Reseau quebecois sur l’integration continentale, suggest that 35 per cent of Hydro Quebec’s annual procurement — currently about $1.1 billion — will be up for grabs to European suppliers.

Original Article
Source: thechronicleherald.ca
Author: CP