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Holding Water

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The second provision is Chapter 11, the investor-state clause, and it applies to water in two ways. First, if any NAFTA country tries to allow only domestic companies to export water, corporations in the other NAFTA countries would have the right to sue for financial compensation – Canada had to pay US $20 million for attempting to ban a potentially harmful additive from our gasoline under this clause. Second, if any NAFTA government introduced legislation to ban bulk water exports, water would automatically become a commercial good, and the first part of Chapter 11 would come into play.

It’s a Catch-22 – if we sell water, it becomes a commodity that we have to sell. If we try to protect it, it becomes a commodity that we have to sell. Either way we are selling.

The third provision, is Article 315, called "proportional sharing" – this is the same provision that has created a continental market for Canada’s energy supplies and the reason why the U.S. has to go to such lengths to put a countervailing duty on Canadian softwood exports.

Under Articles 315 and 309, no country can reduce or restrict the export of a resource once the trade has been established. Furthermore, no country can place an export tax or charge more to the consumers of another NAFTA country than they charge domestically. Therefore Canadian exports of water would be guaranteed to the level they had acquired over the preceding 36 months – the more water we send south, the more water we are required to send south. Even if new evidence was found that massive movements of water were harmful to the environment, these requirements would remain in place.

The proposed FTAA accord poses another threat as water treatment and delivery could be labeled an environmental service. Public water services could be challenged under

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the national treatment provision of the proposed agreement, forcing us to privatize or contract out control to international water corporations like Vivendi and Suez Lyonnaise des Eaux. If any government tries to maintain public control, these corporations could sue us under Chapter 11.

If either NAFTA or FTAA could allow water to be exempt, we could start to sell water, but that will never happen because the current arrangement works in the favour of the U.S. – the moment we sell one drop of our freshwater south, it becomes a commodity. Right now it’s a waiting game with the federal government saying no and provinces asserting their rights over their resources. The first province to open the tap will open the floodgates.

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