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By Alan Alexandroff —

Canada Must Sign in New Zealand with Other Ministers, According to the Government of Canada. Is This Right?

My colleague Sean Stephenson, in his personal capacity, had some thoughts on the presumption that Canada's Minister of International Trade must attend in New Zealand and sign the TPP in order for Canada to retain full membership.

Enjoy his views.

Alan

In the lead up to a signing ceremony on February 4th in New Zealand, the majority of TPP countries have publically indicated that they will sign the Agreement, despite continued debate on the merits of the Agreement. However, Canada’s announcement, in the form of an Open Letter to Canadians by the International Trade Minister, Chrystia Freeland, draws specific attention to the TPP’s entry into force provisions, its effects, and its rare language. The Minister said:

Not attending would mean withdrawing from the TPP altogether, even before Canadians have had an opportunity to fully debate its implications.

…

In addition, it is important to note that signing next week preserves Canada’s status as a potential full partner in the Agreement, with all of the rights and powers that go with it.

Shortly after the Minister’s Announcement, in an article in the Globe and Mail, a leading Canadian newspaper, the former Director General of the Department of Global Affairs (formerly DFATD), Matthew Kronby, supported Minister Freeland’s action. He wrote:

…The problem is that the TPP does not define an “original signatory.” Instead, it assumes that all of the 12 negotiating countries would sign the agreement at the same time. But what if that were not the case? Could a negotiating party such as Canada still have qualified as an “original signatory” if it signed at a later date but before the TPP entered into force?

The agreement’s text offers no clear answers. The TPP does provide that after it is in force for the first group of six or more original signatories, other original signatories can join if the first group agrees. It also offers an accession process for new parties that were not among the original negotiating parties to join. But it is silent on when or how it can enter force for any of the 12 original negotiating parties that are not “original signatories.”

This uncertainty meant that the risks for Canada in not signing on Feb. 4 greatly outweighed any criticism the Liberals may endure by signing it.

In light of these statements a careful review of the words of the TPP are instructive. The TPP text, like the text of many treaties, says nothing about the process of signing the treaty. The TPP refers simply to the process for the “entry into force” of the TPP in Chapter 30 of the Agreement. Article 30.5 says:

  1. This Agreement shall enter into force 60 days after the date on which all original signatories have notified the Depositary in writing of the completion of their applicable legal procedures.
  1. In the event that not all original signatories have notified the Depositary in writing of the completion of their applicable legal procedures within a period of two years of the date of signature of this Agreement, it shall enter into force 60 days after the expiry of this period if at least six of the original signatories, which together account for at least 85 per cent of the combined gross domestic product of the original signatories in 20131 have notified the Depositary in writing of the completion of their applicable legal procedures within this period.
  1. In the event that this Agreement does not enter into force under paragraph 1 or 2, it shall enter into force 60 days after the date on which at least six of the original signatories, which together account for at least 85 per cent of the combined gross domestic product of the original signatories in 2013, have notified the Depositary in writing of the completion of their applicable legal procedures.
  1. After the date of entry into force of this Agreement under paragraph 2 or 3, an original signatory for which this Agreement has not entered into force shall notify the Parties of the completion of its applicable legal procedures and its intention to become a Party to this Agreement. The Commission shall determine within 30 days of the date of the notification by that original signatory whether this Agreement shall enter into force with respect to the notifying original signatory.

As Mr. Kronby notes, the term “original signatory” is not defined. However, it is difficult to ascertain how both Canada and Mr. Kronby came to the conclusion that by not signing on February 4 that Canada may lose some or all of its status. Using the well known rules of treaty interpretation that all words in a treaty must be given meaning and this meaning must be interpreted in the context of the entire treaty- it becomes clear that an “original signatory” should not take this meaning but most likely was intended to mean an “original negotiating party.”

If Canada and Mr. Kronby’s interpretation of the entry into force provision is correct, then the TPP agreement should enter into force 6o days after the ratification of the agreement by the parties signing the agreement on February 4, 2016. This would be the case if only two of the parties signed, or if all other parties signed.  In the event that only two parties signed on that date, all the other parties, who would sign at a later date, would have to be formally approved again by the newly created “TPP Commission” before becoming Treaty Parties.

Additionally, the parties clearly thought of the alternative where not all parties would sign at the same time.  The Treaty notes the key threshold of six parties comprising of 85 percent of GDP.  Here again, the conclusions would be illogical if the term “original signatories” meant only the parties that are intending to sign on February 4.

  • First, if the entry into force requirement of 85% of GDP only applies to the parties that sign on February 4, then theoretically, the TPP could enter into force without either the US or Japan having signed it. For example, if eight parties signed the TPP and six of those parties, comprising 85% GDP of the “original” eight signing parties, ratify the TPP, the TPP would enter into force. This hardly seems like the intent of the drafters, who appear to have wanted an agreement of scale.
  • Second, one interpretation of the requirement of “six parties” ratifying the Agreement could result in the TPP never entering into force. In this hypothetical, if six parties signed at the same time becoming the “original signatories,” and one of those six parties did not ratify, the Agreement could never enter into force. There would be no mechanism through which other parties could be considered the sixth “original” party. The same reasoning would apply even after the two year period from the date of signing.

In short, it is unclear how “original signatory” could mean anything but “original negotiating party.” While Canada undoubtedly is facing external pressures to sign the TPP does not require Canada, or any other party to sign with the some other parties on February 4th. On a larger scale, small misstatements like these exemplify the importance of accuracy from public officials in the contentious public debate that lies ahead for the TPP. Clarity of what the TPP does and does not do, and its corresponding rights and obligations would be a great benefit for everyone involved in the debate.