Sinclair on Binding Enforcement
Last week, Scott Sinclair released an excellent briefing paper on efforts to attach $5-million penalties to the existing Agreement on Internal Trade (AIT). The debate about interprovincial barriers has become a four-ring circus: TILMA, the Ontario-Quebec negotiations, proposals to amend the AIT, and federal threats to invoke the trade and commerce power. In all of these areas, progressives need to prevent overblown concerns about alleged trade barriers from being used to grant business new powers to directly challenge public policy.
Federal procurement, the area of the AIT currently subject to binding enforcement, provides a cautionary example. Sinclair notes that the Canadian International Trade Tribunal has received 315 procurement complaints under the AIT during the past five years, compared to only 15 under international deals. The general feeling at the Treasury Board Secretariat, at least when I worked there under Canadaâ€™s Old Government, was that the costs of running scrupulously armâ€™s-length procurement processes often outweighed any cost savings from having more suppliers bid.
Creating binding enforcements at the national level is the easy part (economically, not politically); the real challenge will be creating targets on an international level where they will have enough scale to actually make a difference.