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Are governments signing away
our democratic rights?
by Connie Hargrave

A report on the little-known Multilateral Agreement on Investment (MAI) to be signed behind closed doors by 28 of the world's wealthiest countries in May 1998, which many fear will empower global corporations/investors to override national and local government regulations and safeguards.

The French are indicating that the MAI would wipe out their film industry; in Britain the MAI has been criticized in Parliament and in the Financial Times; the 'Asian Tigers' are resisting the MAI, and a small but persistent group of Canadians are warning that the MAI will give corporations so much power that Parliament will not matter much any more.

What is the MAI? Unknown to most people, representatives of the world's 28 wealthiest countries are meeting at the Organization for Economic cooperation and Development (OECD) in Paris to negotiate a Multilateral Agreement on Investment, called the MAI, scheduled to be signed behind closed doors in May 1998. Virtually no one had heard about the MAI until citizens sounded the alarm, and very few still know and understand its implications.

Proponents of the MAI say simply that it creates a level playing field for investors globally, and that it will be beneficial especially for developed countries. From their point of view, the different rules and regulations of national, provincial, state or local governments are a hindrance to doing business. Regulations and laws vary from place to place, and these are a nuisance. The consistency guaranteed by the MAI would reassure investors, and this would be beneficial to all OECD countries, they say.

Not so, say opponents. Rather, the MAI gives the world's corporations a virtual charter of rights and freedoms, ensuring them the right to conduct business and move their operations wherever and whenever they like, without any government regulations.

National and local laws represent national sovereignty, or the power of governments to set regulations, say those who are alarmed. National laws, for instance, protect the environment or give employment or financial incentives such as grants for job creation to local businesses, or financial support for films, books, magazines and other cultural enterprises. Such preferential treatment would be challenged under the MAI, because foreign companies would expect to have rights equal to local businesses. Opponents suggest that laws to protect the environment, labour, business and culture would eventually interfere with the rights to make profits, and that local laws would no longer hold under the MAI.

It is no wonder that a few Canadians have become very worried. Canada has historically been vulnerable to being overpowered by the culture of its neighbour to the south, the US. Because there is no language barrier outside Quebec, Canadians are flooded with American movies, magazines, and other US products. This is so pervasive that, in a recent survey, Canadian high school students were asked to name the Prime Minister of Canada, and one-quarter of them named the American President instead. To counteract this trend, the Canadian Government has in the past given financial incentives to Canadian books, magazines, films, and other cultural items to offset the barrage of materials produced by its more populous neighbour.

Seeing the danger of the MAI, a small group of Canadian citizens began to educate others via the Internet and by giving lectures. They approached politicians to ask their position on the MAI, and found that politicians generally did not know much about it. Since then, the Province of British Columbia has officially opposed the MAI, although the agreement is under the jurisdiction of the Federal Government. In addition, one citizen, Connie Fogal, is launching a legal challenge to the Federal Government's authority to sign away the power of the citizen.

Under the MAI, products such as films are simply an investment. A recent Canadian Broadcasting Corporation newscast reported that the French film industry has become concerned, recognizing that the French Government would no longer be able to give preferential treatment to, or subsidize, films made by the French. As a result, they believe, the French film industry would essentially be wiped out.

A French film industry spokesman threatened that "The Americans, who are the driving force behind the MAI, are not going to bully us into creating a world-wide mono-culture." American negotiators have, on the other hand, indicated that if culture is taken out of the agreement, it would be too watered down for them to sign. French opponents have responded by saying that this would be a dream come true.

David Weston, who began to raise the MAI issue in Canada in the spring of 1997 by approaching both federal and provincial politicians, and subsequently key political advisers in Britain, says: "The OECD has recognized the MAI's unpopularity, and is abandoning it under its present name and sponsor. Negotiations are already under way in Paris to rename the agreement and sign it under the World Trade Organization (WTO) instead. I have confirmation from Claude Laverdure, Assistant Deputy Minister (Europe) in the Canadian Department of Foreign Affairs and International Trade, that the MAI is indeed being removed from the OECD and that while its move to the WTO was possible, he was not aware of the timeline."

Weston explains further: "The original WTO-sponsored Multilateral Investment Agreement faltered because the Third World saw its neo-colonialism implications. The International Chamber of Commerce (ICC), along with its Canadian counterparts, who seem to be the main lobbyists in this game, subsequently moved the responsibility for its implementation to the OECD, changing the name to MAI, in the hope of pushing it through. They then 'invited' the Third World to clamber on board under OECD rules."

However, Weston adds: "Now that the ICC and their ilk have discovered that public awareness and ire are aroused, they have decided to re-route it once again back to the WTO. The implications of WTO's involvement are important, for under C.57, Chapter 47 (1994) WTO Implementation Act, the Canadian Prime Minister is given authority to sign any international agreements within the purview of the WTO, without reference to Parliament."

Nevertheless, Weston says: "Any agreement our country signs under the WTO Implementation Act would be illegal. Under the Canadian Constitution Act (Interpretation Act, R.S.C. 1985, c.1-21, section 42(1)), it is absolutely clear that no parliament, present or future, can be shackled or bound by the decisions of any previous parliament. It is my contention, therefore, that because the WTO Implementation Act does attempt to bind present and future parliaments, that it is 'ultra vires', that is, beyond the jurisdiction of parliament. If any of its agreements signed bind any parliament beyond the life of any one parliament, then this government is acting illegally, and as such, is bordering on treason, because the right of citizens to bring in whatever legislation they please, is sacrosanct."

Weston says that he is taking such an active role in raising public awareness about these obscure negotiations because "These agreements are not primarily about trade and investment but, rather, an attempt to replace democratic involvement and control by citizens with corporate control by a tiny elite. My concern is that while our attention is being diverted over the MAI, other similarly obnoxious agreements are being signed under our noses."

Weston and a small group of citizens remain active in interpreting these agreements to the public and politicians alike. It appears that this minority has had some successes, as people like David continue to try to bring down the Goliath of unregulated international commerce.

From the April 1998 issue of Share International.

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First published April 1999, Last modified: 15-Oct-2005