William Watson: They\u2019re legalizing marijuana but they still won\u2019t trust us with beer<\/a><\/li>\n<\/ul>\nNot so, said the court. Even though Section 121 talks about goods being admitted \u201cfree,\u201d the court said that doesn\u2019t really mean free of all restrictions. Only if the \u201cprimary purpose\u201d of the measure restricts trade does it run afoul of the Constitution. As stated by the court: \u201c . . . a party alleging that a law violates s. 121 must establish that the law in essence and purpose restricts trade across a provincial border.”<\/p>\n
Establishing that a provincial law \u201cin essence and purpose\u201d restricts trade is a very high bar indeed. Many laws, regulations and measures have a variety of objectives, only one of which could be to restrict trade. A provincial law ostensibly aimed at other factors, when its genesis is examined, could include a disguised trade barrier even if that is not its \u201cessence and purpose.\u201d Under the Supreme Court\u2019s dictum, that law would still pass muster.<\/p>\n
Of course, the court is charged with interpreting Canadian law and doesn\u2019t have to look at larger international treaties or jurisprudence under Canada\u2019s trade agreements. But it would have been highly instructive for the court to have considered the array of decisions of the World Trade Organization and its predecessor, the General agreement on Tariffs and Trade (GATT), two bodies that have had over 60 years of experience dealing with border issues and trade barriers. Had it done so, it may well have used different language and come to a more balanced decision.<\/p>\n
The WTO and GATT agreements aimed at opening up markets and dealing away direct and disguised trade restrictions. These differ in obvious respects from Canada\u2019s Constitution and so we can\u2019t ascribe total comparability between the two. However there are aspects of the WTO agreement that inform aspects of Canada\u2019s Constitution, particularly the free-trade aspects of Section 121, and these weren\u2019t even considered by the court.<\/p>\n
The WTO agreement obliges signatory states to maintain open markets, subject to only very limited exceptions. Canada\u2019s Constitution is not so direct, except if one considers the use of the word \u201cfree\u201d under Section 121, which implies the objective of open markets from coast to coast. In that sense, Canada\u2019s Constitution shares common attributes with the GATT and WTO agreements in that, while creating Canada as a confederation, the Constitution was \u2014 and is \u2014 based on the principle of a single political and economic union where, one would expect, goods are allowed to enter markets freely from one end to the other.<\/p>\n
Under the WTO agreement and the GATT, countries can only deviate from free-trade obligations where a restrictive measure is demonstrably \u201cnecessary\u201d to protect life, health or the environment and, importantly, isn\u2019t either arbitrary or discriminatory or a \u201cdisguised restriction on international trade.\u201d<\/p>\n
The WTO\u2019s panel decisions and appeal decisions have been very successful at ferreting out such disguised trade restrictions, making it clear that even if a measure meets the test of necessity it is still not considered acceptable if there are less trade-restrictive alternatives that could be employed,<\/p>\n
In the WTO\u2019s famous \u201cAsbestos Case,\u201d where Canada challenged the EU\u2019s restrictions on asbestos imports, the WTO panel and the Appellate Body (to which Canada had appealed) looked carefully at the measure and its human health underpinnings balanced against the rules of free trade and concluded that there were no reasonable alternatives available to the European Union other than preventing asbestos imports.<\/p>\n
Had the Supreme Court looked into some of this WTO-GATT jurisprudence, it might well have modified its \u201cprimary purpose\u201d test, placing a burden on the province to justify interfering with the flow of goods within Canada\u2019s economic union on the basis of \u201cnecessity\u201d and lack of available alternative measures.<\/p>\n
In other words, instead of concluding that under Section 121 the burden is on the complaining party to prove that the \u201cessence and purpose\u201d of a provincial measure is to restrict trade, the court might have concluded \u2014 as in the WTO-GATT \u2014 that the burden is on the province to show that the measure is necessary, that it isn\u2019t a disguised protectionist device, and that no reasonable alternatives exist other than prohibiting imports. It seems that the Supreme Court got this backwards.<\/p>\n
Lawrence L. Herman practices international trade law at Herman & Associates and is a Senior Fellow of the C.D. Howe Institute in Toronto.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"Lawrence Herman: It would have been highly instructive for the court to have considered the array of decisions of the World Trade Organization<\/p>\n","protected":false},"author":578,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[],"tags":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/8070"}],"collection":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/users\/578"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/comments?post=8070"}],"version-history":[{"count":2,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/8070\/revisions"}],"predecessor-version":[{"id":8072,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/posts\/8070\/revisions\/8072"}],"wp:attachment":[{"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/media?parent=8070"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/categories?post=8070"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/wp-json\/wp\/v2\/tags?post=8070"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}