Investigation C-122-839 160 Pages Full document Investigation PUBLIC DOCUMENT
BEFORE THE INTERNATIONAL TRADE ADMINISTRATION UNITED STATES DEPARTMENT OF COMMERCE ________________________________ ) In the matter of: ) ) CERTAIN SOFTWOOD LUMBER ) PRODUCTS FROM CANADA ) ) ) ________________________________ )
PETITION FOR THE IMPOSITION OF COUNTERVAILING DUTIES PURSUANT TO SECTION 701 OF THE TARIFF ACT OF 1930, AS AMENDED
PUBLIC DOCUMENT ON BEHALF OF NATURAL RESOURCES DEFENSE COUNCIL, DEFENDERS OF WILDLIFE NORTHWEST ECOSYSTEM ALLIANCE Patti Goldman Earthjustice Legal Defense Fund 705 Second Ave, Suite 203 Seattle, WA 98104-1711 (206) 343-7340 (206) 343-1526 (fax)
[email protected] Attorney for the Natural Resources Defense Council, Defenders of Wildlife and the Northwest Ecosystem Alliance
GRAND COUNCIL OF THE CREE (Eeyou Istchee) INTERIOR ALLIANCE (Nlaka’pamux Nation, Okanagan Nation, Secwepemc Nation, St’at’imc Nation, Southern Carrier Nation) Dated: May 10, 2001
TABLE OF CONTENTS INFORMATION ABOUT SUBMITTERS
6
SUMMARY
9
PART I – CANADA AND BRITISH COLUMBIA WAIVER OF ENVIRONMENTAL RESTRICTION SUBSIDY A.
Tab 1 - 11
Canada Does Not Enforce Its Fisheries Act Against Logging Companies 1.
Canada Has Jurisdiction Over Management Of Streams In Forest Areas 11 a)
Constitution And Fisheries Act
b)
Provincial Logging Regulations Do Not Override The Federal Fisheries Act
2.
3.
B.
11
11
12
Canada Has Taken A Substantive Position On What Riparian Buffers Should Be
14
a)
General Canadian Position
14
b)
February 2000 Letters
16
Canada Has Failed To Enforce Its Riparian Buffer Provisions
17
a)
Authority To Enforce
17
b)
Failure To Enforce In The Face Of Systemic Violations
18
Canada’s Failure To Enforce Fisheries Act Habitat Provisions Constitutes A Countervailable Subsidy 1.
2.
20
Failure To Enforce Fisheries Act Habitat Provisions Is A “Waiver Of Environmental Restriction Subsidy”
21
Financial Contribution And Benefit
22
a)
22
Timber From Riparian Areas Is A Financial Contribution
2
3. C.
b)
Reduction In Logging Costs
24
c)
Foregone Revenues
25
Subsidy Is Specific To The Timber Industry
26
Magnitude Of The Subsidy
28
1.
Value Of The Riparian Timber
28
a)
Area Logged In Violation Of The Fisheries Act
28
b)
Timber Volume From The Area
30
c)
Countervailable Value
31
2.
Reduction In Logging Costs
31
3.
Foregone Revenues
32
PART II – QUEBEC WAIVER OF FIRST NATION TREATY OBLIGATIONS SUBSIDY
Tab 2 - 33
A.
Introduction
33
B.
The Rights Of The Crees and Quebec’s Forestry Regime
34
1.
The Cree People
34
2.
The Grand Council of the Cree
35
3.
The Rights of the Crees in Canadian Law
35
a)
The James Bay and Northern Quebec Agreement
36
b)
The Hunting, Fishing and Trapping Rights of the Crees
37
c)
The Environmental and Social Regime
38
4.
Quebec’s Forest Act
40
3
C.
The Impact Of The Forest Act On the Rights Of The Crees
41
D.
The Impact Of The Forest Act On Eeyou Istchee
45
E.
The Pre-Eminence Of The James Bay And Northern Quebec Agreement
48
F.
The Mario Lord Case
49
G.
Legal Issues Before The Department Of Commerce
50
H.
Conclusions
52
PART III - BRITISH COLUMBIA NON-RECOGNITION OF ABORIGINAL TITLE SUBSIDY
Tab 3 - 54
A.
Application
54
B.
Interior Alliance
55
C.
Logging In Interior Alliance Territory
57
D.
Macro-Economic Data
60
E.
Relevant U.S. Legislation On Subsidies
61
F.
Aboriginal Title
66
1.
Basic Concepts
66
2.
Constitutional Protection
67
3.
Ownership And Economic Aspect
70
4.
Infringement And Compensation
72
5.
Mandated Negotiations
74
G.
Subsidies Concerning the Environment: Externalized Environmental Cost
77
H.
Conclusions
79
4
LIST OF SUBMITTERS
Tab 4 - 83
CERTIFICATIONS
APPENDICES Appendix I-1
Overview of NRDC’s Forest Initiative
Tab 5
Appendix I-2
Fisheries and Oceans Correspondence (Petrachenko Letters)
Tab 6
Appendix I-3
B.C. Ministry of Forests Correspondence (Emails Received through Freedom of Information Request)
Tab 7
Appendix I-4
Fisheries and Oceans Canada Riparian Management Zones
Tab 8
Appendix I-5
Western Forest Products Correspondence
Tab 9
Appendix I-6
Picard – Hedges Correspondence
Tab 10
Appendix II-1 Treaty Rights in Canadian Law
Tab 11
Appendix III-1 Interior Alliance Resolution 02, April 27, 2001
Tab 12
Appendix III-2 Ministry of Indian Affairs Correspondence
Tab 13
Appendix III-3 Case Study: Innovative Forestry Plan Interfor – Adams Lake and Adams Lake Correspondence
Tab 14
5
INFORMATION ABOUT SUBMITTERS This submission is being made on behalf of the Natural Resources Defense Council, et al as additional information pursuant to the petition In the Matter of Certain Softwood Lumber Products from Canada, Investigation C-122-839.1 We are submitting this additional and clarifying information concerning countervailable subsidies in accordance with the Tariff Act of 1930, as consumer organizations.2 Under the relevant U.S. statute, consumers may submit “relevant information and argument” to the Department of Commerce concerning dumping or a countervailing subsidy.3 This submission is made on behalf of consumers by representative consumer organizations in accordance with the underlying principles of the law to allow all interested parties access to the proceedings. Our membership includes consumers of softwood lumber products from retailers across the United States. The Natural Resources Defense Council (NRDC) alone has over 400,000 individual members nationwide. Not only are individual members consumers of softwood lumber at the retail level, but consumer issues and specifically forest products consumption issues are a substantive part of our mission and activities. The Natural Resources Defense Council, Defenders of Wildlife, and the Northwest Ecosystem Alliance (NWEA) are organizations concerned that the consumption of forest products in the United States not harm the environment, nor violate human rights anywhere else in the
1
Investigation C-122-839 before the International Trade Administration United States Department of Commerce and the United States International Trade Commission In the Matter of Certain Softwood Lumber Products from Canada, Petitions for the Imposition of Countervailing Duties Pursuant to Section 701 of the Tariff Act of 1930, as amended, on behalf of Coalition for Fair Lumber Imports Executive Committee, the United Brotherhood of Carpenters and Joiners, and the Paper, Allied-Industrial, Chemical and Energy Workers International Union, April 2, 2001. 2 Tariff Act of 1930, 19 U.S.C. §1671 et seq. 3 19 U.S.C. §1677f(h). 19 C.F.R. 351.312.
6
world. For this reason, we have a direct stake in the softwood lumber trade issues between the United States and Canada.
For example, the Natural Resources Defense Council’s Forest Initiative uses “the power of consumers to help transform markets for wood products and promote responsible forest stewardship.”4 Inter alia, NRDC represents consumers through the following activities: •
NRDC is a member of the Forest Stewardship Council (FSC), helping to establish the environmental labeling of consumer products from forests.5
•
NRDC is a member of and an environmental adviser to the Certified Forest Products Council (CFPC) in order to promote environmentally-labeled forest products.6
•
NRDC has worked on behalf of consumers directly with major retailers of forest products and builders on responsible procurement, including Home Depot, Andersen Windows, and Kaufman and Broad. The groups submitting this additional information work together as a coalition reflecting our
members’ belief that trade and the environment are inextricably linked. Specifically, our concern is that the softwood lumber entering the United States retail market from Canada has been produced with environmentally-damaging subsidies and in violation of the treaty and land rights of First Nations. We have submitted information to the United States Trade Representative concerning the expiration of the Softwood Lumber Agreement.7 We submitted a joint complaint before the Commission
4
Overview of NRDC’s Forest Initiative, Forests for Tomorrow: Responsible Forest Stewardship through Consumer Power, Natural Resources Defense Council. 5 The Forest Stewardship Council is an international non-profit organization founded in 1993 to support environmentally appropriate, socially beneficial, and economically viable management of the world's forests. Both the Natural Resources Defense Council and the Defenders of Wildlife are members of the FSC. See, www.fscoax.org. 6
The Certified Forest Products Council is an independent, not-for-profit, voluntary initiative committed to promoting responsible forest products buying practices throughout North America in an effort to improve forest management practices worldwide. See, www.certifiedwood.com.
7
on Environmental Cooperation concerning lack of enforcement of the Canadian federal Fisheries Act under the North American Free Trade Agreement in the context of softwood lumber logging in British Columbia.8 We have worked extensively with our membership and the broader public in the United States to raise awareness concerning the threat subsidized Canadian softwood lumber poses to the environment and to First Nations rights.9 In making this submission, we represent the concerns of all responsible consumers of softwood lumber regarding the urgent need for a change in the system of subsidies in Canada that cause environmental and economic damage.
7
For example, Submission of the Natural Resources Defense Council to the Trade Policy Staff Committee regarding Softwood Lumber Practices in Canada and Softwood Lumber Trade between the United States and Canada, April 13, 2000. 8 See, Submission Pursuant to Articles 14 and 15 of the North American Agreement on Environmental Cooperation, David Suzuki Foundation, Greenpeace Canada, Sierra Club of British Columbia, Northwest Ecosystem Alliance, and Natural Resources Defense Council, March 15, 2000. 9 NRDC produced a policy brief, “United States-Canada Timber Trade: Protecting Old Growth Forests and Endangered Species, Winter 2001. NWEA has extensive information on their website concerning the United StatesCanada softwood lumber trade at www.nwea.org .
8
SUMMARY When U.S. industry competes with foreign industry provided with traditional subsidies, the injury is to U.S. companies and workers. When U.S. industry competes with foreign industry provided subsidies from violations of environmental laws, as well as First Nations treaties and rights, U.S. companies and workers are equally injured, but there is an added injury – to the world’s ecosystems, to the livelihood of First Nations, and to future generations. The submitters support many elements of the submission of the Coalition for Fair Lumber Imports et al regarding Certain Softwood Lumber Products from Canada. The submitters seek to present additional information regarding subsidies granted to Canada’s softwood lumber industry. The submitters allege that the Canadian and British Columbia governments are providing a ‘waiver of environmental restrictions subsidy’ to the British Columbia forest industry through a deliberate and systematic failure to enforce Canada’s federal Fisheries Act habitat provisions in British Columbia. Canada has taken a clear substantive position on the need for greater stream buffers to be left around streams in order to meet the Fisheries Act and yet stands by while the British Columbia government mandates the logging of these buffers. Canada’s failure to enforce Fisheries Act habitat provisions constitutes a countervailable subsidy under U.S. law. The magnitude of this subsidy is significant. The submitters conservatively calculate that this subsidy to the B.C. industry is in the order of at least C$243 million each year, or equivalent to 3.5% of B.C.’s lumber shipments. The submitters further allege that across Canada, First Nations see their treaty and land rights violated so that timber companies may benefit. In 1975, the James Bay Cree of Quebec entered into a treaty with the government of the province of Quebec and the federal government of Canada. The James Bay and Northern Quebec Agreement is primarily a land and environmental treaty. It recognizes the Cree
9
right to occupy territory through the traditional subsistence economy and to have a major role in other types of future economic development in the region. The agreement established an environmental protection regime to safeguard the resources necessary for a viable subsistence economy in the context of development. Neither Quebec nor Canada has honored this treaty, giving yet another type of subsidy to timber companies who are allowed to clearcut Cree lands in violation of treaty obligations. Finally, the submitters allege that as in British Columbia no treaties were signed with indigenous peoples, the government of British Columbia confers a subsidy in allowing timber companies to log lands under land claims disputes. The Canadian Supreme Court recognized the inherent land rights as Aboriginal Title and furthermore found that they were protected under Section 35 of the Canadian constitution. While British Columbia fights First Nations land rights claims in the courts, the province allows destructive resource practices to continue, such as wide-spread clear-cutting of Native hunting and fishing grounds. Forest companies are the beneficiaries of these delay tactics. They can continue harvesting undervalued timber and in the case of a finding against the governments they would have to account for the difference in value. Forest companies are therefore receiving financial contribution both through revenue foregone and through the provision of services under market value. The submitters request the Department of Commerce to investigate these subsidies in support of Investigation C-122-839 In the Matter of Certain Softwood Lumber Products from Canada.
10
PART I CANADA AND BRITISH COLUMBIA: WAIVER OF ENVIRONMENTAL RESTRICTION SUBSIDY
A.
Canada Does Not Enforce Its Fisheries Act Against Logging Companies 1.
Canada Has Jurisdiction Over Management Of Streams In Forest Areas a)
Constitution And Fisheries Act
Under Section 91(12) of the Canadian Constitution Act, fisheries management falls under Canadian Federal jurisdiction, while under Section 92(5), forestry management falls to the Canadian Provinces. Canada’s fisheries management takes place through the Fisheries Act, which includes sections pertaining to fish habitat and water quality. Section 35(1) of the Fisheries Act states that “no person shall carry on any work or undertaking that results in harmful alteration, disruption or destruction of fish habitat.” Fish habitat is defined under Section 34(1) to be “spawning grounds and nursery, rearing, food supply and migration areas on which fish depend directly or indirectly in order to carry out their life processes.” According to the Habitat and Enhancement Branch of Fisheries and Oceans Canada, “Certain riparian (streamside) areas are considered fish habitat as well and are therefore protected under the Fisheries Act. This would include many areas that are adjacent to streams, lakes and marine environments.”10
Section 36(3) of the Fisheries Act states that “no person shall deposit or permit the deposit of a deleterious substance of any type in water frequented by fish or in any place under any conditions where the deleterious substance or any other deleterious substance that results from the deposit of the
10
See, http://www-heb.pac.dfo-mpo.gc.ca/english/water_quality/fish_and_pollution/phys_hab.htm.
11
deleterious substance may enter any such water.” A deleterious substance would include silt that results from disturbance of streams or their surroundings. Regarding the types of “fish” regulated by the Canadian Federal Government, ocean-going or dwelling species, including anadramous species such as salmon, fall under the federal purview. There is an established history of the participation of Fisheries and Oceans Canada in forestryrelated planning and management in the various Canadian provinces regarding the issue of fish habitat in forests. There is also an established case history of Fisheries and Oceans Canada exercising its authority under the Fisheries Act to prosecute parties who have violated various habitat provisions. Relevant to this submission, in its Policy for the Management of Fish Habitat, first published in 1986, Fisheries and Oceans Canada states: “The wise management of fish habitat supporting Canada's productive fisheries will ensure that the socioeconomic benefits and employment generated by the fisheries sector are not forfeited unknowingly by actions in other economic sectors...” 11
Fisheries and Oceans Canada therefore has the express responsibility under the Fisheries Act to protect against the harmful intrusion upon fish habitat by various economic sectors, including the forest industry. b)
Provincial Logging Regulations Do Not Override The Federal Fisheries Act
Under Section 92(5) of the Canadian Constitution Act, the provinces are given jurisdiction over forestry. Each Canadian province has therefore enacted forestry guidelines to govern the activities of the forest industry within its jurisdiction.
11
See, http://www.dfo-mpo.gc.ca/habitat/Policy/english/chap1_e.htm#1.4.
12
Provincial forestry legislation often includes regulations pertaining to fish habitat. For example, the Forest Practices Code of British Columbia Act (herein after the “Forest Practices Code”) includes a system of stream classification based on the size of streams and the presence of fish, plus a system of mandatory and voluntary protections pertaining to those streams.12 Fisheries and Oceans Canada has adapted its level of involvement in provincial forestry practices depending on the level of provincial regulations pertaining to streams. For example, upon the passage of the Forest Practices Code in 1995, Fisheries and Oceans Canada responded: “ [Fisheries and Oceans Canada] is changing its logging referral procedures in view of the increased stream protection provided by the Forest Practices Code … In view of this enhanced protection for fish streams detailed block by block responses will no longer be provided on Forest Development Plans.”13
While Fisheries and Oceans Canada has adapted in this manner, it is important to establish that provincial regulations pertaining to fish habitat do not supersede the Fisheries Act. Canada operates on the principle of federal supremacy, meaning “where there are inconsistent (or conflicting) federal and provincial laws, it is the federal law which prevails.”14 Under Canadian law, the fact that an activity is also subject to provincial regulation does not diminish federal authority. A court case pertaining to the Canadian energy sector found that: “The fact that the E.R.C.B. [Energy Resources Conservation Board] regulates the oil and gas industry in this province does not, in my view, diminish the necessity or importance of the enforcement of provisions of statutes such as section 36 of the Fisheries Act, which has been enacted to protect the environment and the public welfare.”15
12
For more on the riparian provisions of the Forest Practices Code, see below. Letter from H. Allan Chambers, Fisheries and Oceans, to MacMillan Blodel Ltd., 31 January 1996. 14 Hogg, Peter G., Constitutional Law of Canada, 4th Edition (Loose-leaf, 1997), Vol. 1, Chapter 16, page 2. 15 R. v Amoco Canada Petroleum Co. 13 C.E.L.R. (N.S.) 317 (Alta., Prov. Ct.) 13
13
In an exchange of letters between Canada and British Columbia directly relevant to this submission (see below for more), Donna Petrachenko, Director General, Pacific Region, Fisheries and Oceans Canada, writes: “…permits and approvals provided under the [Forest Practices] Code do not exempt forest tenure holders from complying with [the Fisheries Act].”16
2.
Canada Has Taken A Substantive Position on What Riparian Buffers Should Be a)
General Canadian Position
Over the years, Fisheries and Oceans Canada has taken substantive positions defining what kind of riparian buffers are needed to protect fish habitat in order to implement the Fisheries Act. In 1997, Fisheries and Oceans Canada published the report Establishing Fisheries Management and Reserve Zones in Settlement Areas of Coastal British Columbia, in which it reviewed the latest science regarding buffers for riparian zones. The science contained in the report is applicable to all streams everywhere. The report demonstrates Fisheries and Oceans Canada’s knowledge of processes and functions of riparian zones, and the distance from streams that these processes and functions take place. For example, it shows that to prevent “large organic debris recruitment,” buffers from 35 to 65+ meters are needed, and that to protect bank stability, buffers of 25 to 50+ meters are needed.17 In the report, Fisheries and Oceans Canada finds that at least 50 meter buffers are needed for all fish-bearing permanent streams, and that at least 30 meter buffers are needed on all ephemeral and intermittent streams.18
16
Letter to Lee Doney, Deputy Minister, B.C. Ministry of Forests, July 5, 2000. Fisheries and Oceans Canada, Establishing Fisheries Management and Reserve Zones in Settlement Areas of Coastal British Columbia, 1997 at page 21. 18 Id. at page 29. 17
14
This position of Fisheries and Oceans Canada is in keeping with that of agencies in other jurisdictions. In 1993, several U.S. agencies conducted an ecological, economic and social assessment of forest ecosystem management in the types of ecosystems that also are found in British Columbia. Their report recommends riparian buffers on fish-bearing streams equal to the height of two site potential trees, or 300 feet (about 91 meters) slope distance, whichever is greatest. It also recommends a buffer of one potential tree height, or 150 feet (about 45 meters) slope distance for permanent non fish-bearing streams.19 In the United States, following this report, state and federal agencies established mandatory buffers for all fish bearing streams in Washington and Alaska federal, state, and private lands.20 Fisheries and Oceans Canada also has taken substantive positions on what is not adequate regarding riparian buffers. As noted above, following the passage of the B.C. Forest Practices Code in 1995, Fisheries and Oceans Canada judged that the Forest Practices Code would satisfy the requirements of the Fisheries Act, but the accumulation of evidence since that time has made the agency reconsider its stance. In 1997, the Sierra Legal Defense Fund, a non-profit environmental legal firm in Vancouver, B.C., conducted an independent study of logging practices around streams. The study found that 83% of B.C. streams surveyed were clearcut to the banks, and only 12% of the streams surveyed had explicit prohibitions on the damaging practice of dragging logs through them on the way to logging trucks.21 These practices are still permitted under the Forest Practices Code. The B.C. law does not prohibit clearcutting to the banks of most streams, including the smaller fish-bearing ones.
19
Forest Ecosystem Management: An Ecological, Economic and Social Assessment. Report of the Forest Ecosystem Management Assessment Team (FEMAT), United States Departments of Agriculture, Commerce, Interior, and the Environmental Protection Agency, 1993. 20 Forests and Fish Report, 1999; Modified 1997 Forest Plan, Forest Service, U.S. Department of Agriculture, Record of Decision for Tongass national Forest Land and Resource Management Plan, 1999; AK ST s41.17.116, s41.17.118. 21 Sierra Legal Defense Fund, “Stream Protection Under the Code: The Destruction Continues,” February 1997.
15
By 1999, Fisheries and Oceans Canada staff were specifically criticizing the Forest Practices Code, as the following statements from agency staff reveal: “…MacMillan Bloedel’s assertion that adherence to the Forest Practices Code will fulfill their commitment to maintain fish, fish habitat, and riparian attributes is not the Department of Fisheries and Oceans’ position, particularly with regard to small streams.”22 “If you look at the small streams that are harvested under the Forest Practices Code, they are no longer ecosystems.”23
It is therefore clear that Fisheries and Oceans Canada has the knowledge that riparian buffers are needed to protect fish habitat, and that the agency also knows that the Forest Practices Code does not provide adequate buffers. b) February 2000 Letters In early 2000, Fisheries and Oceans Canada formally expressed to British Columbia forestry officials and companies what it considered to be adequate buffers to protect fish habitat. In letters to the British Columbia government and industry, Donna Petrachenko, Regional Director General of the Pacific Region of Fisheries and Oceans Canada, writes: “My staff inform me that current logging practices in this province rarely provide riparian strips or setbacks that adequately protect [small] streams…Given the current practice and importance of [small] streams, we wish to confirm that the Federal Fisheries Act…continues to apply to the practice of logging adjacent to small streams in this province.”24
22
Dovetail Consulting, “An Evaluation of DFO Involvement in Land and Resource Management Planning in British Columbia,” prepared for the Habitat and Enhancement Branch, Fisheries and Oceans Canada, March 5, 1999 at page 56. 23 Id. at page 59. 24 Letter from Donna Petrachenko, Director General, Pacific Region, Fisheries and Oceans Canada, to Lee Doney, Deputy Minister, Ministry of Forests, February 28, 2000.
16
The letters recommended a review of the Forest Practices Code and outlined guidelines for riparian buffers until that review could be completed. The guidelines included 30 meter buffers with tree retention approaching 100% on small fish-bearing streams, and the same buffers 20 meters on each side of non-fish bearing streams that feed directly into fish-bearing streams. The sending of these letters in early 2000 was significant in that it represented the first formal and systematic communication of riparian buffer standards that Fisheries and Oceans Canada wished the British Columbia government and logging industry to follow. The Government of Canada, however, has failed to enforce these standards, allowing instead for the B.C. logging industry to continue to profit from the degradation and destruction of fish habitat, contrary to the Fisheries Act. 3.
Canada Has Failed To Enforce Its Riparian Buffer Provisions a)
Authority To Enforce
The Fisheries Act imposes a duty on Fisheries and Oceans Canada to enforce habitat provisions in various ways. The most relevant are outlined below. First, Sections 35 and 36 of the Fisheries Act authorize the Canadian federal government to pass specific habitat regulations to implement and enforce the act. For example, under Section 36 of the Fisheries Act, the Canadian government has regulated pulp mill effluent emissions (as clean water is one element of fish habitat).25 The Canadian government has the same powers under Section 35. Thus, the Canadian federal government has the authority to develop and implement regulations setting specific standards for riparian buffers in order to protect fish habitat. Second, Section 40 of the Fisheries Act authorizes Fisheries and Oceans Canada to pursue prosecution after-the-fact of those who harmfully damage fish habitat. It has the ability to assess penalties
25
Pulp and Paper Effluent Regulations, SOR/92-269.
17
ranging from summary convictions with C$300,000 fines and up to six months imprisonment, to indictable convictions with fines up to C$1 million and three years imprisonment. Third, under Section 37 of the Fisheries Act, Fisheries and Oceans Canada may require information from the proponent of a work or undertaking to allow the agency to determine if the work or undertaking will result in a harmful alteration, disruption, or destruction of fish habitat, or if the work or undertaking will result in the deposit of a deleterious substance. If the information obtained indicates that a violation of the Fisheries Act is likely to occur, the agency may require modifications to the activity or restrict its operation. b)
Failure to Enforce in the Face of Systemic Violations
It has been established that Fisheries and Oceans Canada has taken a substantive position on what kinds of riparian buffers are needed to protect fish habitat, and it has been established that the agency has the authority under the Fisheries Act to enforce these necessary buffers. After sending the February 2000 letters, field staff of Fisheries and Oceans Canada attempted to hold the B.C. logging industry to the federal riparian buffers. For example, field staff in Campbell River, B.C. and Prince Rupert, B.C. commented on recently proposed logging plans, indicating that the federal buffers should be followed.26 In these cases, British Columbia logging officials and logging companies refused to follow the buffer guidelines. Shawn Hedges, Small Business Officer for the British Columbia Forest Enterprise Program responded to Fisheries and Oceans Canada that he would not follow the guidelines because he considered them “overly conservative.”27 Bill Dumont, Chief Forester of Western Forest Products, wrote “we do not intend to undertake a huge investment that would be required to change our riparian management plans and practices to address the [Fisheries and Oceans Canada] position.” Dumont also
26
Letters from Chris Picard, Habitat Management Biologist, Fisheries and Oceans Canada, to Shawn Hedges, Small Business Officer, MoF, November 8, 2000, and from Mike Austin, Habitat Field Technician, DFO, to Jason Laird, Field Engineer, Western Forest Products, June 20, 2000.
18
went further, urging a British Columbia government official to "…take this matter up with senior [B.C. Ministry of Forests] executives and their counterparts in [Fisheries and Oceans Canada]."28 Documents obtained through the Freedom of Information and Privacy Act of British Columbia indeed show the British Columbia Ministry of Forests officials and the B.C. forest industry working to gain a retraction of the Petrachenko letters. An e-mail from the B.C. Council of Forest Industries to British Columbia forestry officials reads: “Until revoked or appropriately modified, the letters could constitute evidence of the standard of practice that must be taken to avoid contravention. [The Ministry of Forests] and [Fisheries and Oceans Canada] should be focusing immediately on how to remove licensees from this position.”29
A representative from the British Columbia Interior Lumber Manufacturers Association urged provincial forestry officials to take “an aggressive stance” with Fisheries and Oceans Canada.30 British Columbia forestry officials met with Fisheries and Oceans Canada officials and it was agreed that the governments would talk about the issue, along with the forest industry. At present, more than a year after Fisheries and Oceans Canada put forth riparian standards, they are yet to be implemented. Meanwhile, B.C. logging companies continue to log to the banks of small fish streams in B.C., and continue to receive provincial approval to yard logs through streams, causing the degradation of fish habitat and water quality in clear violation of the Fisheries Act. There is a systemwide refusal on the part of the British Columbia government and logging industry to implement the federal riparian buffers.
27
Letter from Hedges to Picard, November 15, 2000. Letter from W.E. Dumont, Chief Forester, Western Forest Products, to Ken Colingwood, Regional Manager, MoF, faxed June 29, 2000. 29 Brian Gilfillan, Council of Forest Industries in an email to Larry Pedersen, B.C. Chief Forester, March 20, 2000. 30 Id. 28
19
Fisheries and Oceans Canada has not used any of its enforcement capabilities under the Fisheries Act to remedy the situation. Fisheries and Oceans Canada has not enacted regulations under Sections 35 or 36 that would allow its field staff to require compliance with its buffer provisions. Fisheries and Oceans Canada has not filed a single charge against a logging company under Section 40 for failing to comply with its buffer provisions. And, Fisheries and Oceans Canada has not required that logging plans be formally submitted under Section 37 to it in order to require modifications. Canada’s actions go beyond normal prosecutorial discretion in enforcement actions to a systematic and deliberate stance to not enforce the law.31 In sum, there is a failure to enforce the Fisheries Act on the part of Fisheries and Oceans Canada with regard to its riparian buffers. As outlined below, this equals a subsidy in the hundreds of millions of dollars to the B.C. logging industry. B.
Canada’s Failure to Enforce Fisheries Act Habitat Provisions Constitutes A Countervailable Subsidy
U.S. law states that a countervailable subsidy must do at least one of the following: provide a financial contribution, provide any form of income or price support within the meaning of Article XVI of the GATT 1994, or entrust or direct a private entity to make a financial contribution that confers a benefit, if providing the contribution would normally be vested in the government.32 Further, the regulations state that where the provisions concerning the identification and measurement of countervailable subsidies do “not expressly deal with a particular type of alleged subsidy, the Secretary will identify and measure the subsidy, if any, in accordance with the underlying principles of the
31
See also, Submission Pursuant to Articles 14 and 15 of the North American Agreement on Environmental Cooperation, David Suzuki Foundation, Greenpeace Canada, Sierra Club of British Columbia, Northwest Ecosystem Alliance, and Natural Resources Defense Council, March 15, 2000. 32 19 U.S.C. §1677(5)(B).
20
Act…”33 The subsidies outlined in this submission meet the requirements of the U.S. law, when measured in accordance with the underlying principles of the Tariff Act of 1930. 1.
Failure To Enforce Fisheries Act Habitat Provisions Is A “Waiver Of Environmental Restriction Subsidy”
Both the federal Canadian government and the British Columbia provincial government grant B.C. timber companies the equivalent of a “waiver of environmental restriction subsidy.” As explained above, British Columbia allows timber companies to violate the Fisheries Act through its Forest Practices Code. Canada has acknowledged that B.C.’s fish habitat provisions are not adequate to meet the Fisheries Act, yet has not used its regulatory or enforcement powers to remedy the situation. This results in a financial contribution to timber companies and lost revenue for the Canadian government. It is clear that the riparian buffers asked for by Fisheries and Oceans Canada have the ecological value needed to meet the habitat provisions of the Fisheries Act. It is equally clear, however, that these buffers also have an economic value to the B.C. logging industry, and it is for this reason that the Canadian and B.C. governments have failed to uphold them. The failure of Fisheries and Oceans Canada to uphold its own buffer requirements, coupled with the actions of the British Columbia government both in lobbying against these buffer requirements and also in awarding logging activities in the buffers, constitutes a “waiver of environmental restriction subsidy” for the British Columbia forest industry. At this point in time, both governments are acting (or not acting) in concert so that the federal buffer requirements are not implemented or enforced. There is a causal nexus between the actions and inactions of these governments and the benefit conferred on B.C. timber companies – in allowing logging of areas that should otherwise be denied, in reducing logging costs, and in foregone fines. This program of deliberate and systematic nonenforcement is a clear subsidy to B.C. loggers.
33
19 C.F.R. 351.501.
21
2.
Financial Contribution And Benefit a)
Timber From Riparian Areas Is A Financial Contribution
A financial contribution under the U.S. statute can include the situation where the government provides a good.34 The financial contribution also must confer a benefit.35 In this first instance, the submitters allege that the government of British Columbia provides a good in the form of wood fiber. Thus, the financial contribution under the statute is the provision by the British Columbia government of wood fiber to lumber producers. Both Canada and British Columbia’s actions concerning the Fisheries Act are the cause of this financial contribution. The government action in allowing timber companies to have access to otherwise inaccessible logs from public lands is the equivalent of the provision of funds or goods to the timber companies that these companies would otherwise not have access to were it not for this “waiver of environmental restriction subsidy.” Benefit means better treatment than you would receive in the market but for the government action in question.36 The statute states that in the case where goods are provided, a benefit is conferred if goods are provided for less than adequate remuneration.37 The statute continues that the adequacy of remuneration shall be determined in relation to prevailing market conditions for the good being provided.38 The U.S. regulations state that for government programs, the Secretary of Commerce will normally consider a benefit to be conferred where a firm “pays less for its inputs (e.g., money, a good, or a service) than it otherwise would pay in the absence of the government program, or receives more revenues than it otherwise would earn.”39 The use of the word “normally” implies that there are other options and, indeed, the regulations follow by making clear that this methodology:
34
19 U.S.C. §1677(D)(iii). 19 U.S.C. §1677(B). 36 19 U.S.C. §1677(5)(E). 37 19 U.S.C. §1677(E)(iv). 38 19 U.S.C. §1677(E)(iv). 35
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“…is not intended to limit the ability of the Secretary to impose countervailing duties when the facts of a particular case establish that a financial contribution (or income or price support) has conferred a benefit, even if that benefit does not take the form of a reduction in input costs or an enhancement of revenues.”40
In determining whether or not a government received “adequate remuneration,” the regulations require the Commerce Department to go beyond factors such as product similarity and quantities sold. The regulations leave the door open for “others factors affecting comparability.”41 In this case, the standard tests for determining market value do not apply to timber logged from protected riparian ecosystems. Examining other factors affecting comparability, the timber logged in areas that are protected under the Fisheries Act have “infinite” value. By protecting buffers of trees along fish habitat, the Fisheries Act has given those trees a value based on the ecological value as elements of the riparian ecosystem, rather than based on the economic value of logs. The market can never adequately pay for this ecological value, and the value is therefore “infinite.” Because an “infinite” countervail charge is impossible to levy, the submitters request a countervail duty on these logs in the amount equivalent to their entire value as sawn lumber. Such a countervail duty is equivalent to canceling out the existence of these logs, which is in turn equivalent to the enforcement of the Fisheries Act. See below for a more detailed explanation of this calculation. b)
Reduction in Logging Costs
As stated above, the Secretary of Commerce will consider a benefit to be conferred where a firm pays less for its inputs than it would in the absence of the government program.42 These inputs can
39
19 C.F.R. 351.503(b)(1). 19 C.F.R 351.503(b)(2). 41 19 C.F.R. 351.511(a)(2)(i). 42 19 C.F.R. 351.503(b)(1). 40
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include money, a good, or a service. The waiver of environmental restriction subsidy provides British Columbia timber companies with lower logging costs. Specifically, under the subsidy, timber companies profit from the extra ease with which they can plan and carry out their logging operations without the need to lay out and log around riparian buffers. For example, a 1997 study for the British Columbia Ministry of Forests on logging costs in the province explored the costs incurred by the British Columbia industry for the lower riparian provisions of the Forest Practices Code. It concluded: “Riparian management area (RMA) requirements were found to be a major cost driver in all areas of the province, with the greatest impact occurring on the Coast. The cost categories which have been significantly impacted by riparian management area requirements include: •
Tree to truck: increases in tree to truck costs were related to the additional costs of falling, yarding and skidding around RMAs. Where cable systems were used, additional costs were incurred in feathering riparian management zones, more frequent equipment moves and reduced yarding efficiency where the location and orientation of RMAs reduced yarding distances below optimum. Where skidding was employed, additional costs were incurred in skidding to designated crossings, often coupled with a second machine entry or handfalling in riparian management zones.
•
Road expenses: increases in road costs were related to restrictions in road practices within RMAs, locating roads outside RMAs where possible, single machine crossings of streams during road construction, etc.
•
Forest management and engineering: forest management and engineering cost increases were the result of increased planning and layout requirements to
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properly locate and classify streams and delineate riparian reserve zone and riparian management zone boundaries.”43
It can be safely assumed that should the larger riparian buffers required under the Fisheries Act be implemented, the same types of costs would be incurred by the British Columbia industry in greater magnitude. Thus, through the waiver of environmental restriction subsidy, the B.C. industry is able to, in effect, lower its logging costs, therefore lowering the costs of logs to B.C. sawmills. c)
Foregone Revenues
Under the U.S. statute, financial contribution also means “foregoing or not collecting revenue that is otherwise due.”44 The third category of financial contribution in this case is the revenue that Canada foregoes through refraining from enforcement actions. Under the Fisheries Act, Canada has the right to assess penalties ranging from summary convictions with fines up to C$300,000 to indictable convictions with fines up to C$1 million.45 Each year, Canada does indeed pursue financial penalties against parties who violate the Fisheries Act. Fisheries and Oceans Canada statistics show fines for the B.C./Yukon region totaling C$426,401 in 1999/2000, C$721,824 in 1998/1999, and C$554,701 for 1997/1998.46 However, Canada has not sought fines from B.C. logging companies who violate its February 2000 buffer guidelines, despite the fact that since that time, the B.C. timber industry has logged more than 200,000 hectares (490,000 acres), including logging in the riparian buffers of many hundreds of streams.47
43
“Financial State of the Forest Industry and Delivered Wood Cost Drivers,” April, 1997, prepared for British Columbia Ministry of Forests by KPMG. See, http://www.for.gov.bc.ca/het/costs/fin-10.htm. 44 19 U.S.C. §1677(D)(ii). 45 Section 40 of the Fisheries Act. 46 See, http://www-heb.pac.dfo- mpo.gc.ca/english/habitat_policy/offender_lists.htm#1999/2000%20Offenders
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The decision to refrain from enforcement actions in the case of logging to the banks of small fish-bearing streams means that Canada is foregoing millions of dollars of revenue (see below). This is a financial benefit to B.C. timber companies who would have to pay this revenue to the Canadian government. 3.
Subsidy is Specific To The Timber Industry
For a subsidy to be countervailable, it also must meet the test for specificity set forth in the U.S. statute.48 Under the statute, “specificity” means that the authority limits the subsidy to a particular enterprise or industry. The Coalition for Fair Lumber Imports petition makes it clear that the timber industry in Canada meets the statutory requirements for “enterprise or industry” under 19 U.S.C. § 1677(5A)(D).49 The forest products industry and the lumber industry, therefore, are “industries” or “groups of industries” for purposes of the specificity requirement under the statute. The subsidy claimed in this submission is specific to the timber industry, as it is not broadly available nor widely used throughout the economy. Canada’s failure to enforce the Fisheries Act is de jure specific. De jure specificity exists where "the authority providing the subsidy, or the legislation pursuant to which the authority operates, expressly limits access to the subsidy to an enterprise or industry."50 In the present case, Canada’s failure to enforce the Fisheries Act pertains to activities
47
B.C. Ministry of Forests, “Sustainable Harvesting Levels” U.S. Fact Sheet, January 2001, www.gov.bc.ca/for 19 U.S.C. §1677(5A). 49 The statute recognizes that a subsidy may be specific under either of two types of specificity, de jure (where the subsidy is specific as a matter of the administering authority's law and regulations), and de facto (where it is specific as a result of its actual use). Within de facto specificity, furthermore, there are four factors the Department may consider. 19 U.S.C. §1677(5A)(D)(iii)(I)-(IV). Reversing the Chapter 19 Lumber panel, Congress has made clear that the Department can find de facto specificity based on any "one or more" of these. 19 U.S.C. §1677(5A)(D)(iii); accord S. Rep. at 94 ("Commerce shall find de facto specificity if one or more of the above factors exists") (emphasis original); accord SAA at 931. 132 That is, if a subsidy meets any one of these tests, it is capable of distorting allocation of resources in the economy. Accordingly, the Department provides in its present regulations that it will consider each factor in order, and that "if a single factor warrants a finding of specificity, the Secretary will not undertake further analysis." 19 C.F.R. 351.502(a). 50 19 U.S.C. §1677(5A)(D)(i). 48
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mandated by the Forest Practices Code. The Forest Practices Code expressly regulates the British Columbia logging industry.
Canada’s failure to enforce the Fisheries Act is also de facto specific. A subsidy is de facto specific if it meets any one of the following four criteria: “(I) The actual recipients of the subsidy, whether considered on an enterprise or industry basis, are limited in number. (II) An enterprise or industry is a predominant user of the subsidy. (III) An enterprise or industry receives a disproportionately large amount of the subsidy. (IV) The manner in which the authority providing the subsidy has exercised discretion in the decision to grant the subsidy indicates that an enterprise or industry is favored over others.”51
The sole beneficiaries of this subsidy are timber companies operating under the B.C. Forest Practices Code. Thus, a single industry group receives a disproportionately large amount of the subsidy. Moreover, the authority providing the subsidy has exercised discretion in the decision to grant the subsidy, favoring the timber industry over others. In January 2001, British Columbia passed the Fish Protection Act giving municipal governments the authority to require mandatory 15-30m buffers for fish streams inside their jurisdictions.52 This means that other industries such as housing developers are held to a higher standard of stream buffers than the B.C. logging industry. This underlines the fact that the B.C. government gives an advantage to the timber industry that it does not extend to other development sectors and industrial groups. C.
Magnitude Of The Subsidy 1.
51 52
Value Of The Riparian Timber
19 U.S.C. §1677(5A)(D)(iii). Fish Protection Act, Bill 25, Province of British Columbia, Ministry of Environment, Lands, and Parks.
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As noted above, the submitters request that timber from protected riparian areas be countervailed at its entire sawn lumber value. The actual benefit is much higher, based on ecological, economic, and social factors, however, for the purposes of this submission, the sawn lumber value can act as an indicator of the benefit, although it far undervalues the loss. Below is a methodology to arrive at the entire sawn lumber value. a)
Area Logged In Violation Of The Fisheries Act
It is possible to calculate the difference in area between the riparian buffer provisions of the B.C. Forest Practices Code, which we assume is the standard that the B.C. industry currently meets, and the riparian buffer provisions laid out by Fisheries and Oceans Canada, which the industry has refused to meet.
The difference between the buffers center on three classes of streams, called “S4”, “S5” and “S6” streams under the Forest Practices Code.53 Under provincial law, these streams receive ‘Management Zones’ of 30 meters, 30 meters, and 20 meters, respectively, but within these Management
53
S4 streams are fish streams or community watershed of less than 1.5 meters average channel width. S5 and S6 streams are not fish streams.
28
Zones, logging companies are not required to provide any mandatory protection for the streams. The British Columbia government has a voluntary “maximum overall retention” of trees in these Zones of 25%, 25% and 5% respectively.54 The buffers put forward by Fisheries and Oceans Canada in early 2000 require “retention levels approaching 100% retention” of trees in the Management Zones of S4 streams, and of S5 and S6 streams that are direct tributaries to fish-bearing streams. For simplicity, we assume that this equates with noharvest buffers. A readily understandable explanation of the position of Fisheries and Oceans Canada is that the Forest Practices Code Management Zones of S4 streams need to become mandatory buffers, and the Forest Practices Code Management Zones of those S5 and S6 streams that are direct tributaries to fishbearing streams are also to become mandatory buffers. To calculate the area that this equates to, we rely upon documents obtained under the Freedom of Information Act of British Columbia that reveal the British Columbia government’s calculations of stream length by classification, along with associated areas of mandatory and voluntary buffers. According to British Columbia, S4 streams account for 16.3% of the stream lengths within harvest areas, S5 streams account for 5.7% of the length, and S6 streams account for 59.9% of the length. Because it is not possible at this time to calculate what proportion of S5 and S6 streams are direct tributaries to fish-bearing streams, we will make the conservative assumption that no S6 streams are direct tributaries, whereas all S5 streams are. S5 streams are more likely to be direct tributaries given their larger size, and this is a very conservative assumption given that S6 streams are far more numerous. According to British Columbia, the Management Zones of S4 streams account for 4.1% of the area within harvest areas, and the Management Zones of S5 streams account for 1.4%, for a total of 5.5%.
54
See, http://www.for.gov.bc.ca/tasb/legsregs/fpc/fpcguide/riparian/rmatab04.htm.
29
b)
Timber Volume From The Area
We make the assumption that the 5.5% area would produce 5.5% of the volume. Affording for the remote possibility that the Forest Practices Code’s voluntary 25% retention maximums are always met in B.C. on both S4 and S5 streams, we further adjust the volume percentage associated with the differences between the provincial and federal buffer guidelines to 4.125% (a reduction of 25%).
c)
Countervailable Value
The countervailable value is charged against B.C. sawmill shipments. The percentage B.C. timber consumed by sawmills is 86%.55We therefore take 86% of 4.125% to arrive at a sawmill-related volume of 3.5%. The total value of B.C. sawmill shipments in the time period under investigation is C$6,965,793,395.56 We calculate that 3.5% of this figure is C$243,802,769. Given that this amount is ‘extra’ revenue that would not exist if Canada were to enforce its Fisheries Act, we believe that it is therefore appropriate to charge this amount against B.C. imports in the form of a countervail duty. The percentage countervail duty that we therefore request against B.C. sawmill shipments in this instance of provision of logs from protected riparian areas is 3.5%.
55
Coalition for Fair Lumber Imports, Petition in the Matter of Certain Softwood Lumber Products from Canada, Investigation C-122-839, Volume IV A-2. 56 Id. at Volume IV A-1.
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A.
2.
Reduction In Logging Costs
While the submitters do not have the necessary information to calculate the amount of the subsidy involved with the reduction in logging costs associated with failure to implement the Fisheries and Oceans buffers, we believe it to be significant. Studies have estimated that the (inadequate) Forest Practices Code riparian provisions “cost” the B.C. industry C$0.80 per cubic meter of wood in operating costs.57 On an annual harvest of almost 64 million cubic meters, this amounts to about C$50 million.58 It is unclear how the Fisheries and Oceans buffer provisions would compare with the Forest Practices Code provisions in terms of costs, but the numbers are clearly in the order of magnitude of tens of millions of dollars. 3.
Foregone Revenues
If Fisheries and Oceans Canada were to enforce the Fisheries Act, it would collect fines from violations in accordance with the provisions in the Act as explained above. We assume that each offense would bring the maximum C$300,000 under the Section 40 provisions on summary convictions. The average clearcut size in British Columbia is approximately 30 hectares (about 75 acres).59 This equates to roughly 6,500 distinct harvest areas each year. If one assumes conservatively that even half of these areas contain the small streams in question, then this could amount to 3,250 annual violations, equating to almost C$100 million in annual fines.
57
“Financial State of the Forest Industry and Delivered Wood Cost Drivers,” April, 1997, prepared for British Columbia Ministry of Forests by KPMG. See, http://www.for.gov.bc.ca/het/costs/fin-10.htm. 58 Cubic meters estimate is taken from Coalition for Fair Lumber Imports, Petition in the Matter of Certain Softwood Lumber Products from Canada, Investigation C-122-839 at IV A-2. 59 B.C. Ministry of Forests, http://www.growingtogether.ca/facts/forest_practices.htm
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PART II QUEBEC WAIVER OF FIRST NATION TREATY OBLIGATIONS SUBSIDY
A.
Introduction
This intervention by the Grand Council of the Crees of Eeyou Istchee is based on violations by the Government of Quebec, and by the Quebec forest industry, of provisions of The United States Code, Title 19, Chapter 4, Subtitle IV, concerning subsidies. Such violations enable the U.S. government to impose countervailing and antidumping duties. This intervention concerns direct and indirect subsidies provided by Quebec to the forest industry operating within the James Bay watershed in the east, central and northeastern portion of the province of Quebec. This is the land we call Eeyou Istchee, the traditional home of the Cree People. The Grand Council of the Crees accepts, supports and endorses the application of the Natural Resources Defence Council concerning the failure of the Government of Canada to enforce the Fisheries Act when forestry companies or provincial Ministries of Forests violate the provisions of that Act. The continued failure to prosecute these violations constitutes an ongoing indirect subsidy to the industry. The Grand Council also supports the claim of the Coalition for Fair Lumber Imports that unfair subsidies are provided by the Government of Quebec to softwood lumber producers.60 These subsidies include artificially low stumpage rates that do not reflect the true value of harvested timber. Along with these direct subsidies, Quebec’s forestry industry is granted unfair competitive advantages through the
60
Investigation C-122-839 before the International Trade Administration United States Department of Commerce and the United States International Trade Commission In the Matter of Certain Softwood Lumber Products from Canada, Petitions for the Imposition of Countervailing Duties Pursuant to Section 701 of the Tariff Act of 1930, as amended, on behalf of Coalition for Fair Lumber Imports Executive Committee, the United Brotherhood of Carpenters and Joiners, and the Paper, Allied-Industrial, Chemical and Energy Workers International Union, April 2, 2001.
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province’s Forest Act, which has established a regime of indirect subsidies through unsanctioned environmental degradation in violation of Cree rights. The application of U.S. countervailing duties against Canadian lumber industry exports, and in particular against Quebec’s lumber industry’s exports, will achieve the following material benefits: a) The market value of harvested wood established by countervailing duties will more closely approximate the true market value of the product unaided by direct and indirect subsidization. b) The unfair competitive advantage of Quebec’s lumber industry will be reduced. c) The increase in the price of timber in Quebec will reduce the pace and volume of logging in Eeyou Istchee. d) This reduction will result in less damage to the boreal forest in Eeyou Istchee, including wildlife habitat, soils, and water. e) This in turn will reduce the negative impacts on the Cree’s guaranteed rights to hunt, fish and trap in Eeyou Istchee. f) The Crees’ ability to exercise those guaranteed rights will increase.
Thus the application of U.S. trade law will work directly to benefit the environment, promote sustainable development of the forests, and uphold the rights of Indigenous People, while eliminating unfair competitive advantages for Quebec’s lumber industry. Therefore, we are submitting this additional and clarifying information in accordance with the Tariff Act of 1930.61 B.
The Rights Of The Crees And Quebec’s Forestry Regime 1.
The Cree People
The people who comprise the Cree Nation of Eeyou Istchee have inhabited the eastern region of James Bay since time immemorial. Thriving as a hunting, fishing and gathering society, the Crees of
61
Tariff Act of 1930, 19 U.S.C. §1671 et seq.
33
Eeyou Istchee ranged over an area from approximately the 79th meridian in the west to the 70th meridian in the east, and from the 48th parallel in the south to just north of the 56th parallel. Today nine communities are home to over 12,000 people who make up the Cree Nation of Eeyou Istchee. The Cree families still occupy the full extent of their traditional lands. They depend upon their harvest from the land for food, and as an important element of their culture and society. The Crees are recognized as one of Canada’ First Nations or Aboriginal Peoples. In U.S. law they would be designated an “Indian Tribe”. 2.
The Grand Council Of The Crees
The Grand Council is the regional political representative organization of the nine Cree communities. The Grand Council is comprised of elected representatives from each community and is headed by a popularly elected Grand Chief. The Council is charged with the duty of ensuring that the Governments of Canada and Quebec fulfill their obligations with respect to the implementation of the James Bay and Northern Quebec Agreement (see below), and also with the protection of other Cree rights and interests. 3.
The Rights Of The Crees In Canadian Law
As Aboriginal People, the Crees have particular constitutional rights that are guaranteed protection from government legislation, regulation, policy or action. Generally these rights relate to: a) the Crees’ status as “Indians”, endowing them with constitutionally guaranteed Aboriginal rights; and b) the Crees’ status as signatories to the James Bay and Northern Quebec Agreement, a modern Treaty between Indians and government, endowing them with constitutionally guaranteed Treaty rights.
Briefly described, in Canadian law, Aboriginal rights are held by the Indian people of Canada and relate to the customs, practices and traditions that were of central significance to their various societies
34
prior to the arrival of Europeans. These rights have formal constitutional protection from government action, which restricts government executive, administrative and legislative abilities. Prior to 1982, Canadian law allowed Aboriginal rights to be extinguished if government met strict legal tests. However, a 1982 amendment to the Canadian Constitution barred government from extinguishing Aboriginal rights. Government may infringe on these rights only if specific, strict, and exacting legal tests are met prior to the government taking any infringing action. (This issue is further detailed in Appendix II-1.) Briefly described, Treaty rights are held by “Indian” people who have signed land-sharing agreements with government. Since at least 1763, governments have been legally and constitutionally required to deal honestly and openly with Indians who are the original landowners. Government is required to enter into Treaties prior to opening up any land for settlement, natural resource extraction or similar purposes. Treaty rights are upheld in the Canadian Constitution in the same manner as Aboriginal rights. They may not be extinguished and are protected from government action. They exist independently of Aboriginal rights and are seen in law as “super added” to Aboriginal rights. (See Appendix II-1.) a)
The James Bay And Northern Quebec Agreement
In 1975, the Crees (and, further north, the Inuit) of Quebec entered into the James Bay and Northern Quebec Agreement with Canada and the province of Quebec. This Agreement arose out of pressure to develop the region’s rich natural resources. First of the modern Treaties in Canada, the Agreement recognized and affirmed numerous pre-existing Cree rights, including their unique relationship and dependency upon the land and natural resources in Eeyou Istchee. The James Bay and Northern Quebec Agreement covers in excess of 410,000 square miles of land, a Territory greater than the area of California, Arizona and New Mexico combined, or one and a half times larger than Texas.
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Key among the diverse provisions of this Treaty is a land regime that guarantees the continuation of the Crees’ right to occupy the Territory through subsistence activities—hunting, fishing and trapping—and that ensures them a major role in other types of future economic development in the region. The James Bay and Northern Quebec Agreement is not designed to preclude resource development. Rather, its function is to ensure that resource exploitation occurs in a manner that does not significantly infringe upon the Crees’ ability to carry out their traditional way of life and in particular their ability to exercise their guaranteed rights to hunt, fish, trap and gather.62 b)
The Hunting, Fishing and Trapping Rights of the Crees
Section 24 of the James Bay and Northern Quebec Agreement guarantees that the Crees shall be able to continue their traditional practices of hunting, fishing and trapping in a modern and even commercial fashion, so as to maintain the viability of their way of life and ensure their social, cultural and economic well-being.63
Cree hunting, fishing and trapping may be conducted throughout the year
and across all of Eeyou Istchee, except where there is actual physical conflict with other uses. The definition of physical conflict is narrow and promotes wide exercise of Cree rights: “. . . [T]he creation or existence of parks, reserves, wilderness areas, ecological reserves and the grant or existence of concessions or rights with respect to forestry or mining shall not in themselves be considered conflicting physical activities and the Native people shall continue to have the right to harvest in such areas.”64
The James Bay and Northern Quebec Agreement requires that activities undertaken in the Territory adhere to the principle of conservation, and defines conservation as the pursuit of the optimum
62
The James Bay and Northern Québec Agreement, 1991 ed., (Québec: Editeur officiel du Québec) Sections 4, 5, 22, 24, 28. 63 See James Bay and Northern Quebec Agreement, supra, section 24.3.12 - 24.3.16, for example. 64 Ibid, section 24.3.6.
36
productivity of all living resources, protection of eco-systems and endangered species, and conditions that ensure continuation of Cree traditional pursuits.65 The specific Cree rights are further explicitly guaranteed and protected with respect to forestry development by Section 22 of the James Bay and Northern Quebec Agreement (see below).66 c)
The Environmental and Social Regime of the James Bay and Northern Quebec Agreement
To give effect to and safeguard the hunting, fishing and trapping rights of the Crees in Eeyou Itschee guaranteed under Section 24 of the James Bay and Northern Quebec Agreement, the Agreement established a detailed Environmental and Social Protection Regime. This Regime is fundamental to the Treaty, as stated in the introductory Philosophy of the Agreement: “Land is the very basis of the Cree and Inuit cultures. And it is not just a matter of sustaining themselves with the harvest of the land, which of course they do. They have a mystique about the land, and what it contains. They have a special relationship with the land that their ancestors inhabited, a link, something indefinable but real and genuine nevertheless. . . . So we are by no means talking about a dying way of life. On the contrary, it is strongly maintained. The native peoples hold to it with every fibre of their being. And as the North is inevitably opened up to other peoples, it would be wrong not to do what is in our power to do to guarantee and protect this way of life. . . . That is why there will be a specific Environmental and Social Regime in the North. Its guiding principle will be development in harmony with the protection of the environment.”67
Section 22 of the Agreement establishes strict rules for development in the Territory, including development activities undertaken by the forestry industry.68 Through sub-Section 22.2, the James Bay and Northern Quebec Agreement provides for:
65
Ibid, section 24.1.6. Ibid, section 24.11. 67 Ibid, Philosophy of the Agreement. pp. XXI-XXII. 68 Ibid, section 22.l.4. 66
37
a) A procedure whereby environmental and social laws and regulations and land use regulations may from time to time be adopted if necessary to minimize the negative impact of development in or affecting the Territory upon the Native people and the wildlife resources of the Territory; b) An environmental and social impact assessment and review procedure established to minimize the environmental and social impact of development when negative on the Native people and the wildlife resources of the Territory; c) A special status and involvement of the Cree people over and above that provided for in procedures involving the general public through consultation or representative mechanisms wherever such is necessary to protect or give effect to the rights and guarantees in favour of the Native people established by and in accordance with the Agreement; d) The protection of the rights and guarantees of the Cree people established by and in accordance with Section 24; e) The protection of the Cree people, their economies and the wildlife resources upon which they depend; f) The right to develop in the Territory.
In balancing development with the rights of the Crees, the Environmental and Social Protection Regime detailed in Section 22 of the James Bay and Northern Quebec Agreement established a series of social and environmental review panels. The task of these panels is to review proposed development as well as legislation concerning any associated government policy and projects that might affect the Crees, their rights, and traditional lands.69 These review panels provide the framework for fulfilling the promises of the James Bay and Northern Quebec Agreement. 4.
69
Quebec’s Forest Act
Ibid, Section 22.2
38
Since coming into force in 1987, Quebec’s Forest Act has been the guiding legislation for the operation of the forestry industry in Quebec. The Act sets up a forestry regime under a legal instrument known as a “Timber Supply and Forest Management Agreement.” Timber Supply and Forest Management Agreements have become the principle means by which forestry companies in Quebec are granted access to public timber. These timber agreements, which can be held only by companies with wood processing plants, give near-perpetual cutting rights over most of Quebec’s public forests, including some 27,000 square miles of Cree Territory covered by the James Bay and Northern Quebec Agreement. 70 As of March 31, 1996, a total of 262 Timber Supply and Forest Management Agreements had been signed, allocating over 97.5% of the available supply of softwood lumber in Quebec.71 Sections 42, 43 and 66 of the Forest Act clearly state that a forestry company with a Timber Supply and Forest Management Agreement has the right to harvest a volume of timber within a specific geographic area sufficient to meet the requirements of that company’s processing plant.72 Sections 45 and 46 of the Act state that the only limit on the volume of timber cut is “the maximum volume of annual timber harvests that may be obtained in perpetuity” from that geographic area without reducing “the production capabilities of the forest.” This right to cut timber in a Timber Supply and Forest Management Agreement is granted for a minimum period of 25 years, and thereafter automatically extended every five years. Sections 51 and 52 of the Forest Act stipulate that the holder of a Timber Supply and Forest Management Agreement must prepare 25-year, 5-year and annual forest management plans. These plans set out the long, medium and short term forest management and harvesting activities of the Agreement
70
Forest Act, RSQ, c.F-4.1. Figures are based on a compilation of the 5-year management plans of Timber Supply and Forest Management Agreement holders in Eeyou Istchee. 71 Ministry of Natural Resources, Le Bilan du régime forestier (Quebec: Ministry of Natural Resources, 1998). 72 In the James Bay Territory, one company, Barrette Chapais, has a Timber Supply and Forest Management Agreement covering 17,000 km2 or 6,560 mi2 (1995). This is the largest Agreement in the province.
39
holder. All of these plans are submitted for approval to the Quebec Minister of Natural Resources in 5year renewable cycles. The annual plans are further submitted and approved yearly. Public participation and input into decisions on how forestry companies operate on public lands in Quebec is permitted only through a 45-day review period for the 5- and 25-year management plans. Participation in this review first requires an application to be made in writing, giving reasons and stating the interest of the applicant in the forest to which the management plan applies. The Timber Supply and Forest Management Agreement holder is bound to consult only with those members of the public who applied for review of the management plan in the first 20 days of the 45-day review period. Even timely application does not guarantee effective public input, however, as the Timber Supply and Forest Management Agreement holder is not bound to alter its management plan based on recommendations submitted in this public review process. C.
The Impact Of The Forest Act On The Rights Of The Crees
Despite the provisions of Section 24 of the James Bay and Northern Quebec Agreement, which guarantee the Crees continuing hunting, fish and trapping rights, and despite the various requirements set out in Section 22 of the Agreement regarding forestry development, the Forest Act has no special provisions to address or safeguard Cree rights. Maximization of the timber harvest is at the forefront of the Forest Act. No concerns beyond the “the production capabilities of the forest” are mentioned in the Act. There were no public consultations or environmental assessments conducted prior the assignment of currently held Timber Supply and Forest Management Agreements. Nor was any forestland within the Territory of the James Bay and Northern Quebec Agreement set aside for preservation or conservation. There are no Cree hunting and fishing grounds, ecological reserves, or parks secure from logging in the entire Territory. In addition to granting forestry companies complete access to the Territory, the Government of Quebec has foregone environmental assessment of forestry activities in the Territory. Neither the Forest
40
Act nor the Timber Supply and Forest Management Agreements, nor any 25-year, 5-year, or annual forest management plans have ever been subject to assessment under the Environmental and Social Regime of the James Bay and Northern Quebec Agreement. It is the same situation for wood processing plants and their upgrades. This represents a direct violation of the Treaty. Section 22 of the Agreement includes a schedule of “Future Developments Automatically Subject to Assessment.” Developments listed under the heading of “Forestry and Agriculture” include: a) Major access roads built for extraction of forest products; b) Pulp and paper or other forestry plants; and c) In general, any significant change in land use substantially affecting more than 25 square miles.73
This clearly indicates that “significant” forestry developments, such as those allowed by Timber Supply and Forest Management Agreements, should be automatically subject to a full environmental and social impact assessment.74 In addition to the Timber Supply and Forest Management Agreements themselves, the corresponding 25-year and 5-year management plans substantially affect more than 25 square miles, thereby making them legally subject to assessment. However, the Government of Quebec has not subjected the Timber Supply and Forest Management Agreements and their corresponding plans—or, moreover the Forest Act itself—to the various review panels established by Section 22 of the James Bay and Northern Quebec Agreement. The same is true of wood processing facilities. Instead, Quebec has chosen to adhere only to those environmental assessment requirements noted in the provincial Environment Quality Act. In 1986, the same year the Forest Act was introduced, the Government of Quebec amended its Environment Quality
73
The James Bay and Northern Quebec Agreement, 1991ed., (Quebec: Editeur officiel du Québec), Sections 22, Schedule 1(4). 74 According to company management plans, in 1995 the average size of Timber Supply and Forest Management Agreement in region under the jurisdiction of the James Bay and Northern Quebec Agreement’s was 1350 square miles.
41
Act to specifically exempt forestry developments from environmental assessment and review in breach of the various amendment clauses required by the James Bay and Northern Quebec Agreement; particularly in paragraph 22.7.10, which states that provisions of the Environmental and Social Regime (Section 22) can only be amended with the consent of the Crees and the government. The Crees believe this action was a deliberate attempt to circumvent the provisions of the James Bay and Northern Quebec Agreement that were designed to safeguard the environment of the James Bay Territory and the Crees’ continued right to hunt, fish and trap.
The Government of Quebec’s decision to amend its Environment Quality Act and ignore its commitments to the Crees was made in direct contravention to Section 22.2.3 of the James Bay and Northern Quebec Agreement. This provision requires that all applicable federal and provincial laws comply with the provisions of the Agreement: “All applicable federal and provincial laws of general application respecting environmental and social protection shall apply in the Territory to the extent that they are not inconsistent with the provisions of the Agreement and in particular of this Section. If necessary to give effect to the present Section of the Agreement, Quebec and Canada shall take the required measures to adopt suitable legislation and regulations for such purposes.” (emphasis added)
Clearly this requires Quebec to legislate in compliance with the provisions of the James Bay and Northern Quebec Agreement. When drafting legislation related to natural resource development, Quebec must give due consideration to the guiding principles set out in paragraph 22.2.4 of the Agreement, which are as follows: a) The protection of the hunting, fishing and trapping rights of Native people in the Territory, and their other rights in Category I lands, with respect to developmental activity affecting the Territory;
42
b) The environmental and social protection regime with respect to minimizing the impact on Native people by developmental activity affecting the Territory;
c) The protection of Native people, societies, communities, economies, with respect to developmental activity affecting the Territory;
d) The protection of wildlife resources, physical and biotic environment, and ecological systems in the Territory with respect to developmental activity affecting the Territory;
e) The rights and guarantees of the Native people within Category II lands established by and in accordance with Section 24 until such land is developed;
f) The involvement of the Cree people in the application of this regime;
g) The rights and interests of Non-Native people, whatever they may be;
h) The right to develop by persons acting lawfully in the Territory; and
i)
The minimizing of negative environmental and social impacts of development on Native people and on Native communities by reasonable means with special reference to those measures proposed or recommended by the impact assessment and review procedure.
In (1) setting out a forestry regime that places the maximization of its timber harvest above all other concerns and laws; (2) allocating all available forestland within the jurisdiction of the James Bay and Northern Quebec Agreement despite its impact on the rights of the Crees; (3) establishing a Forest Act that provides no special consideration for the Aboriginal and Treaty rights of the Crees; and (4) amending its Environment Quality Act so as to rationalize its non-compliance with the requirement for extensive environmental and social assessment under the Agreement, the Government of Quebec has
43
clearly disregarded provisions 22.2.3 and 22.2.4 of the James Bay and Northern Quebec Agreement. In doing so, Quebec has disregarded the guaranteed rights of the Crees in favour of benefiting the forestry companies operating in Eeyou Istchee. D.
The Impact Of The Forest Act on Eeyou Istchee
As stated at the outset of this brief, the Crees are recognized as an Aboriginal People or Indian Tribe. As such, they have a special relationship with the environment in which they reside. Their occupancy spans millennia and is rooted in the productivity of the land that sustains them physically, spiritually and culturally. This relationship has been recognized through the Crees’ Aboriginal and Treaty rights. The Crees’ ability to freely hunt, fish and trap in Eeyou Istchee is a vital economic and cultural expression of these rights. Obviously, to conduct these subsistence activities, a viable land base must be available. This is why the Crees depend and even insist upon suitable protection of wildlife and its habitat. Unfortunately, the necessary habitat is being systematically fragmented by large-scale forestry operations. At the signing of the James Bay and Northern Quebec Agreement in 1975, approximately 9,000 square miles of forestland in Eeyou Istchee were allocated to the forestry industry. Today, as noted previously, over 27,000 square miles are allocated under Timber Supply and Forest Management Agreements. This is an area equal in size to Vermont, New Hampshire and Connecticut combined. Large-scale clear-cutting is the principle means of harvesting in Eeyou Istchee. It is estimated that over 6,000 square miles of forestland have been cumulatively clear-cut since the Treaty was signed in 1975, with an additional 300 square miles of forest now cut each year.75 This annual cumulative clear-cut is nearly equivalent to the average size of one Cree family hunting territory (350 square
75
Figures are based on a compilation of 5-year management plans of Timber Supply and Forest Management Agreement holders in Eeyou Istchee. 44
miles).76 In human terms, this means that one or more Cree extended family groupings are dispossessed of their hunting grounds each year. According to records kept by the Forestry Department of the Grand Council of the Crees (neither Quebec nor Canada keep such records), over 90 Cree hunting territories have been directly affected by forestry. At least 32 of these areas have had in excess of 50% of the mature forest cover removed. In time, virtually 100% of the mature forests in the 27,000 square miles of land covered by Timber Supply and Forest Management Agreements will be clear-cut. This will affect at least 98 Cree hunting territories. Another serious problem is the road network associated with extensive forestry operations. According to satellite mapping produced by the Grand Council of the Crees, there are over 11,000 miles of logging roads running through Eeyou Istchee. This spider web network of roads makes the entire region easily accessible to non-native sport hunters and anglers. Expansion of the road network has been accompanied by downsizing of the government department responsible for enforcing hunting and fishing regulations, and as a result harvesting activities in the Territory have become almost unregulated. Cree hunters repeatedly complain about the establishment of provincially unauthorized non-native hunting or fishing camps on lands reserved for the exclusive use of the Crees. During the fall sport hunting season, Cree subsistence hunters have reported being intimidated out their camps by non-native sport hunters wanting sole use of those areas. Theft and vandalism of Cree camps and equipment is also a regular occurrence. These pressures from sport hunters and anglers are undermining the Crees ability to hunt, fish and trap in their own Territory.
76
“Hunting territories” is the English translation in common use of the Cree words “ndoho istchee.” This refers to the traditional hunting, fishing and trapping lands used by a Cree extended family group. The “ndoho ouchimau” or “tally man” is the Cree owner and steward of the land who is responsible for environmental management and therefore for determining the location, season and number of animals harvested and which Cree hunters and nuclear families may harvest them. The “ndoho ouchimau” must ensure the ecological integrity of the land and the health and populations of wildlife species. Cree society requires the environment to be managed wisely so as to secure the future of the next seven generations of people living off the land. 45
Of even greater concern, forestry operations at this scale have significantly altered the character of the boreal forest, to the detriment of the flora and fauna. It should be noted that all of the forestry development described in this intervention is occurring at the northern extremes (49th –52nd parallel) of the commercial forests. At these latitudes the boreal forest ecosystem is characterized as fragile due to its thin soils, low nutrient availability, and extremes in climate. Under such harsh conditions it takes at least 100 to 120 years for the forest to regenerate itself. This means that large areas formerly inhabited by small and large game animals remain barren for long periods (several generations) after clear-cutting. The current rate of logging in the far north is not sustainable, nor does it approach harmony with Cree subsistence activities, as called for in the James Bay and Northern Quebec Agreement. In opening up the James Bay Territory to such widespread logging operations, the Government of Quebec has clearly favoured the interests of the industry over those of the Crees. By allowing access to 100% of the commercial forest, and not balancing this access with suitable provisions to protect lands for Cree subsistence purposes, the Government of Quebec has disregarded the requirements of the James Bay and Northern Quebec Agreement, thereby indirectly subsidizing the forestry companies operating on those lands. To truly balance the needs of the forestry industry with those of the Crees and fulfill the promise of the Agreement would require a significant amount of forestland, perhaps as much as 50%, to be set aside as wildlife habitat and undisturbed hunting grounds. Modifying existing Timber and Supply Forest Management Plans to reflect this 50% reduction in available timber supply would significantly alter these companies’ competitive profiles. E.
The Pre-Eminence Of The James Bay And Northern Quebec Agreement
In 1982, the Government of Canada amended its Constitution with adoption of the Constitution Act, 1982. Section 35 of that Act affirms constitutional protection for the Aboriginal and Treaty rights of all Canadian Indigenous Peoples, including the Crees.77 Thus the James Bay and Northern Quebec
77
The Constitution Act 1982, as enacted by Schedule B of the Canada Act, 1982 (U.K.), c. 11. Section 35 states: “The existing aboriginal and treaty rights of the aboriginal peoples of Canada are hereby recognized and 46
Agreement was enshrined as a constitutional instrument. It is a foundation of the Rule of Law in Canada and Quebec, unambiguously pre-eminent over conflicting legislation. Under Section 52 of the Constitution Act, 1982, legislation of federal or provincial governments is of no force or effect to the extent of any conflict with provisions of the Constitution. 78 The James Bay and Northern Quebec Agreement, like every other Treaty, was entered into by the Crown under its constitutionally anchored trust and fiduciary duties to Aboriginal People. The Crown was under a legal obligation to deal honestly, openly and fairly during the negotiations leading to the Agreement and, as a fiduciary, was legally required to place the interests of the Native signatories above its own. The Crown, whether federal or provincial, retains these same duties when interpreting and implementing the James Bay and Northern Quebec Agreement. Both the Government of Canada and the Government of Quebec have failed in these legal duties. Quebec’s failure is nowhere more evident than in the current Forest Act and the forestry regime it endorses. In addition to the constitutional weight carried by the Agreement, the Treaty and its implementing legislation clearly acknowledge the paramountcy of the Agreement’s provisions over conflicting national or provincial legislation.79 Case law with respect to the status of the James Bay and Northern Quebec Agreement has also confirmed its standing as a Treaty with pre-eminence over any conflicting federal or provincial law.80
affirmed. In this Act “aboriginal peoples of Canada” includes the Indian, Inuit and Metis peoples of Canada. For greater certainty, in subsection (1) ‘treaty rights’ includes rights that now exist by way of land claims agreements or may be so acquired.” 78 Ibid. Section 52(1) states: “The Constitution of Canada is the Supreme Law of Canada, and any law that is inconsistent with the provisions of the Constitution is, to the extent of the inconsistency, of no force or effect.” 79 Ibid, Section 2.5, see also the federal implementing legislation: James Bay and Northern Quebec Native Settlement Act, S.C. 1976-77, c. 32, section 8: “Where there is any inconsistency or conflict between this Act and the provisions of any other law applying to the Territory this Act prevails to the extent of the inconsistency or conflict;” And see the provincial implementing legislation: An Act approving the Agreement concerning James Bay and Northern Québec, S.Q. 1976, c. 46, section 7: “In case of conflict or inconsistency this Act shall prevail over any other act applicable to the territory described in the Agreement to the extent necessary to resolve the conflict or inconsistency.” 80 Bande d’Eastmain c. Gilpin, [1987] R.J.Q. 1637 (S.C.); Cree Regional Authority v. Canada, [1992] 1 F.C. 440 (C.A.); Cree School Board v. Canada (Attorney General.), [1998] 3 C.N.L.R. 24 (Qué. S.C.); See also Canada v. Coon-Come, [1991] R.J.Q. 922 (C.A.); Canada v. Lord [2000], JE 2000-937 (Que. C.A.) leave to appeal by Canada 47
The Treaty’s pre-eminent standing within the Canadian legal landscape is of utmost importance to this intervention. The Grand Council of the Crees contends that in ignoring, circumventing and bypassing the legal requirements of the Agreement and the Crees’ Aboriginal and Treaty rights, the Government of Canada and, more importantly, the Government of Quebec has established a system of indirect subsidies in favour of Quebec forestry companies operating in Eeyou Istchee. F.
The Mario Lord Case
On July 15, 1998, the Crees instituted the legal proceedings Mario Lord et al v. the Attorney General of Quebec et al. in the Superior Court of Quebec, Court File No.: 500-05-043203-981. Defendants include the Governments of Canada and Quebec, various Ministers of each, and some 28 forestry companies that are operating or have operated within Eeyou Istchee. The case cites Cree traditional use of the lands and forests throughout Eeyou Istchee, invokes Aboriginal and Treaty rights under the James Bay and Northern Quebec Agreement, and Aboriginal rights of their own accord, and alleges breach of those rights by Canada, Quebec and the forest industry. Citing priority Cree use of the land and pre-eminence of the James Bay and Northern Quebec Agreement, the case contests the constitutional applicability of Quebec’s Forest Act, of and all Timber Supply and Forest Management Agreements and forest management plans, to Eeyou Istchee. The case seeks a variety of relief, including declarations, injunctions and orders of mandamus, certiorari and prohibition, and claims damages of more than C$500 million. The Crees estimate that this C$500 million is the value of the indirect environmental and social subsidies Quebec has provided to the forest industry between November 1975 and July 1998. Additional amounts accrue on a daily basis since the filing of the Mario Lord case. G.
Legal Issues Before The Department of Commerce
to the Supreme Court of Canada refused March 15, 2001. 48
The United States Code, Title 19, Chapter 4, Subtitle IV prohibits subsidization of imports into the country to compete with American products. Part I, “Imposition of Countervailing Duties,” requires that if: (1) . . the government of a country . . . or any public entity . . . is providing, directly or indirectly, a countervailable subsidy with respect to the manufacture, production or export of a class or kind of merchandise, imported . . . into the United States, and
(2) in the case of merchandise imported from a Subsidies Agreement country [any WTO country such as Canada], the Commission determines that: (A) an industry in the United States (i) is materially injured, or (ii) is threatened with material injury . . . by reason of the import of that merchandise . . . then there shall be imposed upon such merchandise a countervailing duty, in addition to any other duty imposed, equal to the amount of the net countervailable subsidy.
Part IV, “General Provisions,” defines “Country” as “a foreign country or a political subdivision” and “industry” as “the producers as a whole of a domestic like product.” Section 5 finds the occurrence of a “countervailable subsidy” when any authority provides price support within the meaning of Article XVI of the 1994 GATT, which defines a subsidy to include: . . . any form of income or price support, which operates directly or indirectly to increase exports of any product from . . . its territory. . .
Section 5A, subsection D, dealing with domestic subsidies, defines “specific subsidy” as a matter of law in the following terms: (i) Where the authority providing the subsidy, or the legislation pursuant to which the authority operates, expressly limits the subsidy to an enterprise or industry, the subsidy is specific as a matter of law. 49
The same subsection finds “specific subsidy” to exist as matter of fact, in part, when: (I) The actual recipients of the subsidy, whether considered on an enterprise or industry basis, are limited in number.
The above criteria clearly apply to Quebec and the forest industry operating in Eeyou Istchee. Quebec is a political subdivision of Canada, which is a Subsidies Agreement country. Indirect social and environmental subsidies are offered by Quebec to an entire industry within Eeyou Istchee. Quebec’s Forest Act limits the number of entries into that industry by restricting entry to holders of Timber Supply and Forest Management Agreements. The subsidy provided is a subsidy in both law and in fact. Moreover, the subsidy operates to increase the export of softwood lumber from Quebec into the United States by protecting the Quebec forestry industry from assuming the costs of complying with the demands of the James Bay and Northern Quebec Agreement. The provision of this indirect subsidy causes material injury to the U.S. industry. The injury is set out in the petition of the Coalition for Fair Lumber Imports et al, and the Crees endorse and adopt that argument. In 1999, the Quebec forest industry exported in excess of C$10 Billion worth of timber products to the United States. Of this amount more than C$4.1 Billion was lumber or other wood products, the overwhelming majority of which were softwood exports. 81 H.
81
Conclusions
Ministère des Ressources Naturelles du Québec website, March 29, 2001. http://www.mrn.gouv.qc.ca/3/30/301/ 50
With this intervention, the Grand Council of the Crees of Eeyou Istchee respectfully requests the Department of Commerce to exercise its legal authority and place countervailing duties against softwood lumber exported from Eeyou Istchee, for the following reasons. i.
Under provisions of The United States Code, Title 19, Chapter 4, Subtitle IV, the Department of Commerce is authorized to apply countervailing duties when a foreign government provides direct or indirect subsidies to an industry which exports its goods to the United States, and those goods thereby compete unfairly with domestic U.S. products and harm U.S. industry.
ii.
The government of Quebec provides both types of subsidies to its softwood lumber industry operating on Cree traditional lands.
iii.
Direct subsidies are provided through artificially low stumpage rates as detailed in the petition of the Coalition for Fair Lumber Imports et al, Investigation C-122-839.
iv.
Indirect subsidies are further provided by Quebec through its Forest Act, forest management regulations, and general forestry regime.
v.
The Government of Quebec’s forest legislation and policy are in breach of the James Bay and Northern Quebec Agreement’s constitutionally protected Environmental and Social Protection Regime and violate guaranteed Cree Aboriginal and Treaty rights. These breaches and violations inter alia constitute subsidies through weaker environmental and social protections.
vi.
Quebec’s forestry legislation and regime protect the industry operating in Eeyou Istchee from incurring the real market costs of harvesting timber and manufacturing softwood lumber.
vii.
The environment, Cree hunters and trappers, and Cree society have been illegally forced to assume the true market costs of these operations.
viii.
These direct and indirect government subsidies allow Quebec’s forest industry to export softwood timber to the U.S. to be sold at rates below true market costs.
51
ix.
The U.S. industry is unable to sell its products at prices that can compete with the subsidized softwood lumber imported from Quebec and suffers consequent economic harm.
52
PART III BRITISH COLUMBIA VIOLATION OF FIRST NATION LAND RIGHTS SUBSIDY
A.
Application
This section of the petition is submitted on behalf of the Interior Alliance and its member nations, the Nlakapa’mux Nation, the Okanagan Nation, the Secwepemc Nation, the St’at’imc Nation and the Southern Carrier Nation regarding Softwood Lumber imports to the United States from the Province of British Columbia. The application is based on violations by Canada and the Province of British Columbia of provisions of the United States Code, Title 19, Chapter 4, Subtitle 4, concerning subsidies. It is our submission that the Canadian federal government and the province of British Columbia violate their constitutionally protected fiduciary obligation to Aboriginal Peoples by not protecting their Aboriginal Title interests. A benefit is conferred upon forest companies operating in British Columbia because they do not have to pay for the collective proprietary interests of indigenous peoples, in the following referred to as Aboriginal Title. The companies can then sell the timber extracted from Aboriginal Title lands under market value in the United States. The Interior Alliance Nations therefore request that the U.S. government impose countervailing duties on lumber imports from the province of British Columbia. The Interior Alliance Nations also endorse and add further dimensions to arguments brought by environmental organizations that the present Canadian and British Columbian environmental and forestry legislation and practices do not meet international standards. Finally, the Interior Alliance nations support the claim of the Coalition for Fair Lumber Imports Executive Committee and other United States Industry groups who claim that the present British Columbia stumpage system confers an unfair competitive advantage to Canadian producers. The economic incentive provided by the province’s practice of selling timber at artificially low stumpage rates leads to the increased liquidation of forests in 53
the Aboriginal Title lands of the Interior Alliance nations and to unsanctioned environmental degradation. B.
Interior Alliance
The Interior Alliance groups together 5 indigenous nations in the South Central Interior of British Columbia their combined Aboriginal title territories amount to 25.749.600 hectares and cover almost one third of the present day Province of British Columbia and beyond, with the lands of the Sewepemc reaching into the province of Alberta and the traditional territories of both Nlaka’pamux and Okanagan reaching into the United States. Nlaka’pamux Nation The St’at’imc and Secwepemc Lands bound Nlaka’pamux Territory on the north, along the west by the Coastal Mountains and on the east by Okanagan Territory. As with the Okanagan’s, Nlaka’pamux Territory extends south past the Canadian border into Washington State. The Nlaka’pamux were known by Europeans as Thompson Indians. Okanagan Nation The Okanagan, or Syilx-speaking people, occupy a territory of approximately 43,000 square miles located on the Interior Plateau of south central British Columbia and north Washington state. The American and Canadian border divides the territory politically. The lands of the Syilx that fall within Canada make up a Nation of seven communities. Today the Okanagan’s number approximately 6,000. Secwepemc Nation The Secwepemc People, known by non-natives as the Shuswap, are a Nation of 17 bands occupying the south-central part of the Province of British Columbia. The Secwepemc occupy a territory extending from the Columbia River Valley westward to the Fraser District and south of the Arrow Lakes. The Secwepemc nation was traditionally a political alliance of communities that were separate and
54
independent, but united by a common language - Secwepemctsin - and by a similar culture and belief system. The population of the Secwepemc Nation today is 7,200. St’at’imc Nation Today there are eleven communities in St’at’imc, the St’at’imc Territory, which is located on the western-most edge of the Interior Plateau and extends into the Coastal Mountains. St’at’imc spans the upper Fraser River, and the St’at’imc People, known by Europeans as the Lillooet, were traditionally important traders between their Interior allies and the Coastal Peoples. Southern Carrier Nation The Southern Carrier are four Dené communities occupying territories stretching from the Rocky Mountains in the east – to the Coast mountains on the west. They are centered on the Dean, Blackwater and Quesnel Rivers. The largest communities are the Ulkatcho, the Lhoosk'uz Dené, the Nazko and the Lhtako. These five Indigenous Nations have never ceded or surrendered their respective Aboriginal title and rights to Great Britain, Canada, the United States, or the present day Provinces of British Columbia or Alberta. They have also refused to enter into land claims negotiations with the federal government that necessarily would lead to the extinguishment of their inherent land rights, also referred to as Aboriginal Title. Instead they have joined together in the fight for the recognition of their Aboriginal Title and the protection of their traditional territories that their peoples still extensively use. Although the neighboring Interior Alliance Nations have always maintained trading relationships and shared parts of their territories, they only formed this political union in the past century to ensure that their inherent land rights are protected. The Chiefs of the Interior first gathered in 1910 to call upon the then Prime Minister of Canada, Sir Wilfrid Laurier to recognize their land rights82:
82
Interior Chiefs, Memorial to Sir Wilfrid Laurier, Kamloops, August 25th, 1910. 55
“This was their proposal not ours, and we never accepted these reservations as settlement for anything, nor did we sign any papers or make any treaties about same. They thought we would be satisfied with this, but we never have been satisfied and never will be until we get our rights.”
Despite successive government policies disallowing indigenous peoples to organize around the land question, the Interior Alliance Nations continue to stand strong behind the position of their ancestors and maintain their inherent rights to their traditional territories. Today, collective land rights have been recognized by the Canadian Supreme Court as Aboriginal Title and are protected by the Canadian constitution. Their non-recognition is a violation of national and international law. Therefore, the Interior Alliance nations have decided to take their concerns to the international level. The large-scale exploitation of timber has had a disastrous impact on their traditional territories and multifaceted use. Already, in a submission to the U.S. Trade Representative,83 the Interior Alliance argued that present Canadian logging legislation and practices violate indigenous rights and do not take Aboriginal Title into account. Those arguments will be further elaborated in the following. Despite the fact that the Interior nations have formed this political alliance, each nation remains the holder of Aboriginal Title, their collective proprietary interest according to their own indigenous laws. This submission is therefore presented in the name of the Interior Alliance and in the name of each of its constituting nations, who have unanimously given the mandate to:84 “… make a formal complaint to the United States Government, regarding the matter of Canada subsidizing Softwood Lumber with our respective Aboriginal Title and rights.” C.
Logging In Interior Alliance Territory
Today the Interior Alliance represents almost 21,000 persons. This is the majority of the indigenous population of British Columbia that does not negotiate under the British Columbia Treaty Process which aims at the extinguishment of Aboriginal Title. It is also the majority of the indigenous
83
Interior Alliance, Submission to the US Trade Representative, May 2000. 56
population of the Interior. The Indigenous Peoples of the Interior remain the poorest population groups in their own territories mainly because they are not allowed to share in the wealth of their lands that sustain the local non-indigenous economies. However, many community members still rely upon hunting, fishing and the multifaceted use of their territories to sustain their families. Indigenous elders and land users collectively hold the traditional knowledge that constitutes the longest term ecological data available to scientists, who believe that this knowledge should be the basis for sustainable land and resource use plans.85 However, traditional knowledge is not presently used in land and resource management. The ecosystems of the Interior are very diverse and sensitive, ranging from alpine areas to dry grasslands. Each area was and is intensively used by indigenous peoples according to their traditional calendar. The Interior Alliance has developed an ecosystems-based approach to collecting traditional use data. Studies show that the areas most intensively used are the Montane Forests, located between 610 and 1980 meters elevation. Most of the Interior Alliance Traditional Territory was covered by the closed canopy of Montane Forests. At higher elevations, the predominant trees are subalpine fir, Engelmann spruce and lodgepole pine. In the middle elevations, forests include western red cedar and western hemlock. At the lowest elevations, forests include mostly Douglas fir, lodge pole pine, western larch and western white pine86. Most of those tree species are classified and traded as softwood lumber. The exploitation and trade in softwood lumber directly affects the indigenous land users of the Interior whose traditional hunting and gathering areas are negatively impacted by unsustainable logging practices. In the past, environmental organizations have mainly criticized the destruction of the temperate rainforests along the Coast of British Columbia. However, most of the wood logged in British Columbia is in the Interior – almost two and a half times the volume logged on the Coast. The unsustainable logging practices
84
Resolution 02-April 27-2001, Interior Alliance Leader Council, Cayoosh Creek, St’at’imc Territory. For more information see: Interior Alliance Submission to the Conference of the Parties on the Convention on Biological Diversity, May 2001, regarding Traditional Knowledge and the recognition of Aboriginal Title. 86 For more information on traditional and current land use see: Adams Lake and Neskonlith Indian Bands (1999). 57 85
criticized on the coast are even more prevalent in the Interior. Stumpage rates in the Interior are below coastal rates and the potential for industry manipulation is greater due to the employment of “weigh scaling methods” rather than the “individual scaling methods” used on the Coast.87 The Indigenous peoples of the Interior are concerned about unsustainable logging practices, whose environmental cost is externalized and borne by indigenous land users. Indigenous peoples bear the double cost. Their lands are being destroyed at an increasing rate due to the selling of resources extracted from their traditional territories under market value in international markets, mainly because the collective proprietary interest of indigenous peoples is not taken into account and compensated in decisions and transactions regarding their traditional lands and extraction of natural resources, such as softwood lumber. Without indigenous consent, extractors and purchasers cannot legitimately acquire full title over the resources. The Canadian federal government has a constitutional obligation to protect Aboriginal Title lands. Its continued policy of non-recognition of indigenous land rights violates the Constitution and confers a direct benefit upon companies operating in Aboriginal Title lands without having to pay for the full proprietary interests. Indigenous interests are forfeited in the international marketplace, where Canadian producers liquidate the competitive advantage and most of the profits drawn from not compensating indigenous peoples. The Interior Alliance Nations therefore call upon the U.S. Department of Commerce to take action against the unfair trade practice sustained by the Canadian government’s non-recognition of Aboriginal Title which constitutes a countervailable subsidy under U.S. law. D.
Macro-Economic Data88
The economic dimension of Aboriginal Title becomes clear when looking at the province of British Columbia, the largest area in North America where no treaties were signed. The traditional
Land Traditions of the Neskonlith and Adams Lake Shuswap, Unpublished report (available upon Request). 87 For more detail see: Interior Stumpage Report, Sierra Legal Defence Fund, Vancouver, 2001. 88 Information from: Sadik, Tonio, A Snapshot of Forestry and Mining in BC, Union of BC Indian Chiefs, British Columbia, 2000. 58
territories of the Interior Alliance Nations add up to 25.749.600 hectares, almost a third of the Province of British Columbia with a size of 95.200.000 hectares. The basic tenure system establishes that Crown Title is the radical title underlying all other tenures, from fee simple lands to leases and forest licenses. The Supreme Court has recognized that Aboriginal Title similarly underlies the traditional territories of the respective indigenous nations that add up to the totality of the province. Unlike the United States, where the majority of the forests are privately owned and the European Union where more than ninety percentof the logging occurs in private forests, ninety-three percent of British Columbia forests are public or “Crown” land. More than ninety percent of the logging occurs on those lands which also are Aboriginal Title lands. The process of extracting resources from Crown lands takes place through land tenures (leases, licences, permits, etc.). Approximately thirty percent of the province’s GDP is derived from the export of resources extracted from Crown lands. Many of these commodities leave the province in a raw or nearly raw form. Thus, export revenues are derived predominately from the difference of the cost of extracting a commodity and the value of the raw material in the global market. Forestry is British Columbia’s single largest commodity sector, representing C$16.8 billion of the provincial economy in the fiscal year 1997/98. This includes C$1.4 billion collected by the Ministry of Forests in the form of stumpage fees. In 1997-1998, 154 000 hectares of Crown Land were logged translating into approximately sixty-three million cubic meters of timber. Of this over thirty-five million cubic meters was cut under forest licenses. Another twelve million were cut under tree farm licenses, while the remaining sixteen million was cut through a variety of other permits.
59
Sixty-nine percent of the Annual Allowable Cut in British Columbia comes from the Interior, the traditional territories of the Interior Alliance Nations. The amount of the exploitation is best understood when examining the nine largest Interior forest companies and their Annual Allowable Cuts:89 i.
Canfor: 6,739,117 cubic meters (in 1999, Canfor sent 56% of net sales to the U.S.)
ii. Slocan: 5,638,041 cubic meters (in 1999, Slocan sent 69% of overall sales to the U.S.) iii. West Fraser 4,042,685 cubic meters iv. Riverside 2,356,776 cubic meters v. Weldwood 2,041,303 cubic meters vi. Weyerhaeuser 1,664,813 cubic meters vii. Tolko 1,621,914 cubic meters viii. Ainsworth 1,349,034 cubic meters ix. Pope & Talbot 1,175,137 cubic meters
E.
Relevant U.S. Legislation on Subsidies
This application for the imposition of countervailable duties is brought according to the United States Code, Title 19, Chapter 4, Subtitle 4, foreseeing as a: i.
General rule: If – a. the administering authority determines that the government of a country or any public entity within the territory of a country is providing, directly or indirectly, a countervailable subsidy with respect to the manufacture, production, or export of a class or kind of merchandise imported, or sold (or likely to be sold) for importation, into the United States…
The Canadian government and the province of British Columbia meet the above criteria of “government”.
89
Data from the B.C. Ministry of Forests: http://www.gov.bc.ca/for/. 60
(2) in the case of merchandise imported from a Subsidies Agreement country, the Commission determines that i.
(A) an industry in the United States 1. (i) is materially injured, or 2. (ii) is threatened with material injury…
The criterion of material injury to the U.S. industry has been developed adequately in the petition of the Coalition for Fair Lumber Imports Executive Committee et al. The criteria of degree of industry support and others are best described by the affected industries themselves and the Interior Alliance relies upon those arguments as the basis of their application. Their participation in this investigation before the U.S. Department of Commerce is mainly motivated by the fact that the majority of lumber extracted from Aboriginal Title lands in British Columbia is exported to the United States. The below criteria are enshrined in U.S. legislation and used to determine countervailable subsidies. In the following chapters those criteria will be applied to the specific situation of the Interior Alliance Nations. The three main conditions that have to be met are that: i.
a financial contribution is made by a government,
conferring a benefit, ii. to a specific enterprise or industry.
The contributions of the Province of British Columbia and the government of Canada, both falling within the definition of government in the act, are also provided to a specific industry, the forest industry, which identifies itself as a specific industry group. The petition of the Coalition for Fair Lumber Imports shows that the timber industry in Canada meets the statutory requirements for
61
“enterprise or industry” under 19 U.S.C. §1677(5A)(D). The Department of Commerce has repeatedly determined that the B.C. provision of Crown Wood meets the criteria of specificity90. In the Interior, the non-recognition of Aboriginal Title is a de facto specific subsidy because forestry is the major resource extraction industry in the area and most of the exploitation occurs on Aboriginal Title lands. No other industry conducts similar large scale operations and all the exploitation occurs on Aboriginal Title lands. The subsidy claimed in this submission is specific to the timber industry, "the authority providing the subsidy, or the legislation pursuant to which the authority operates, expressly limits access to the subsidy to an enterprise or industry."91 In the present case, B.C. law and regulation expressly pertain to the forest industry. The numbers of entries to the industry is limited by law. The Interior Alliance also believes that the non-recognition of Aboriginal Title and the nonenforcement of Canada’s obligations regarding indigenous peoples and environmental protection increase the extraction and export of softwood lumber from British Columbia to U.S. markets. In its substance a subsidy92 is defined as a financial contribution, which does not necessarily have to be a direct payment, rather it is defined in Section 1677: a.
(D) Financial contribution The term ''financial contribution'' means i.
(i) the direct transfer of funds, such as grants, loans, and equity infusions, or the potential direct transfer of funds or liabilities, such as loan guarantees,
ii. (ii) foregoing or not collecting revenue that is otherwise due, such as granting tax credits or deductions from taxable income, iii. (iii) providing goods or services, other than general infrastructure, or
90
See, for example: Lumber III Final, 57 Fed. Reg. 22,583; Remand 12, 20, 120. 19 U.S.C. §1677(5A)(D)(i). 92 United States Code, Title 19, Chapter 4, Subtitle IV, Part IV, General Provisions, Section 1677, (B) Subsidy described. 62 91
iv. (iv) purchasing goods.
The Province of British Columbia is providing a financial contribution in the form of a good by making lumber from Crown and Aboriginal Title lands available to forest companies. Also revenue that is due is foregone by not collecting compensation for the collective proprietary interests of indigenous peoples, which the federal government is under an obligation to protect and take into account. A clear benefit is conferred upon companies who do not have to take Aboriginal Title into account and do not even have to compensate for it. Furthermore, a clear economic benefit is conferred to the companies according to the Act Section 1677 (E) Benefits: “A benefit shall normally be treated as conferred where there is a benefit to the recipient, including – (…) (iv) in the case where goods or services are provided, if such goods or services are provided for less than adequate remuneration, and in the case where goods are purchased, if such goods are purchased for more than adequate remuneration.” The failure to include the economic dimension of Aboriginal Title in the price of wood products makes the remuneration inadequate as Aboriginal peoples as the traditional owners of the forests and resources extracted from them do not get paid. According to the Canadian legal system, Aboriginal Title has to be taken into account implying the determination of new market prices that will adequately remunerate indigenous peoples. Any other pricing regimes confer illegal benefits upon Canadian forest companies.
63
Recent international trade law jurisprudence, such as the World Trade Organization Appellate Body Decision concerning Canada – Measures affecting the importation of milk and the exportation of dairy products93 shows that the concept of subsidies is evolving. Although Canada has always called for a restricted interpretation of terms like “direct subsidies,” which according to it, cannot be constituted by payments in kind because they are not to be considered a financial contribution, other countries, like the United States, have argued that payments in kind can be the basis for a direct subsidy. In addition, the WTO Appellate body found against Canada and its restrictive interpretation that payments must be in the form of money:94 “We, therefore, agree with the Panel that the ordinary meaning of the word "payments" in Article 9.1(c) encompasses "payments" made in forms other than money, including revenue foregone.”
According to that decision, it is not necessary that the cost for the reduced price of an export be borne by the government. It is deemed as sufficient that the such a transfer of resources takes place by virtue of “governmental action.” This is clearly the case regarding the sale of lumber resources from British Columbia, where it is through governmental action that revenue due to indigenous peoples is not paid out leading to the artificial undervaluing of the resource. It should be noted that the government of British Columbia has repeatedly refused to discuss resource revenue sharing from the forestry resource with the Interior Alliance. Although the decision was made in the context of the Agreement on Agriculture, the Appellate Body clearly also made reference to the WTO Subsidies Agreement and ensured its interpretation of the integrative factors of subsidies was consistent with it. This agreement in return is the basis for the U.S. legislation regarding countervailing duties. In return, a broader definition of subsidies is consistent with international and U.S. trade laws.
93 94
WT/DS103/AB/R, WT/DS113/AB/R, 13 October 1999. WT/DS103/AB/R, WT/DS113/AB/R, 13 October 1999, paragraph 112. 64
F.
Aboriginal Title 1.
Basic Concepts
Aboriginal Title is the term employed by the Supreme Court of Canada to refer to the collective proprietary interest of indigenous peoples in their traditional territories. The Indigenous Peoples of the Interior have held their inherent land rights connected to their indigenous laws and land use since time immemorial and have always maintained their validity. The Supreme Court of Canada moved to recognize Aboriginal Title in the 1997 Delgamuukw Decision. Aboriginal Title is recognized at common law, it is not defined by it. Rather it is defined according to the locally specific indigenous laws that give rise to it. We are therefore confronted with highly complex and diversified indigenous laws and believe systems that are perfectly adapted to their local environments can help ensure their sustainable use. In the following the term “inherent rights” will be used to refer to Aboriginal Title and rights, due to the fact that they flow from indigenous laws and form the basis of indigenous identity and nationhood. Inherent rights have to be distinguished from treaty rights that are enshrined in and flow from treaties signed between indigenous nations and the Canadian Crown. Both are protected under Section 35 of the Canadian constitution. The Interior Alliance Nations have never signed treaties ceding their inherent land rights. According to the courts, Aboriginal Title is a broader term than Aboriginal rights:95 “111. Aboriginal title is a right in land and, as such, is more than the right to engage in specific activities which may be themselves aboriginal rights. Rather, it confers the right to use land for a variety of activities, not all of which need be aspects of practices, customs and traditions which are integral to the distinctive cultures of aboriginal societies. Those activities do not constitute the right per se; rather, they are parasitic on the underlying title. However, that range of uses is subject to the limitation that they must not be irreconcilable with the nature of the attachment to the land which forms the basis of the particular group’s Aboriginal Title. This inherent limit, to
95
Delgamuukw v. British Columbia (1997) 3.S.C.R., 1010, paragraph 111. 65
be explained more fully below, flows from the definition of aboriginal title as a sui generis interest in land, and is one way in which aboriginal title is distinct from a fee simple.”
The courts categorize Aboriginal Title, as a right sui generis, meaning that it cannot be subsumed into any of the other categories of property known in Canada. Aboriginal Title is held collectively by the respective Aboriginal Nations, based upon the fact that they occupied those lands prior to contact.96 Another factor that makes Aboriginal Title unique is that it is inalienable and cannot be sold or transferred to any third parties. Indigenous peoples can only transfer it to the federal Crown. This unique entitlement of the Crown also gives rise to a fiduciary obligation to protect the interests of indigenous peoples. Although the courts have repeatedly held that Aboriginal Title and rights give rise to a fiduciary obligation, 97 the federal government has so far refused to take positive action to protect Aboriginal Title interests. 2.
Constitutional Protection
According to the Canadian federal system, the provinces administer the majority of all public lands, excluding national parks and other federal lands. They are also in charge of Forestry. In 1982, Section 92 A was added to the Canadian Constitution to ensure that: “92A. (1) In each province, the legislature may exclusively make laws in relation to (…) (b) development, conservation and management of non-renewable resources natural resources and forestry resources in the province, including laws in relation to the rate of primary production therefrom”
96
See: Delgamuukw v. British Columbia (1997) 3.S.C.R., 1010, paragraphs 112-115. Regina v. Guerin (1983) 1 CLNR 20, Regina v. Sparrow (1990) 1 S.C.R. 1075, Delgamuukw v. British Columbia (1997) 3.S.C.R., 1010. 66 97
Also in 1982, Section 35 was added to the Canadian constitution to protect the rights of indigenous peoples. The Courts have found that the provinces do not have jurisdiction to extinguish Aboriginal Title:98 “179. The vesting of exclusive jurisdiction with the federal government over Indians and Indian lands under s. 91(24), operates to preclude provincial laws in relation to those matters. Thus, provincial laws which single out Indians for special treatment are ultra vires, because they are in relation to Indians and therefore invade federal jurisdiction…”
The provinces therefore have to respect Aboriginal Title and are under a constitutional obligation not to pass legislation undermining it. Present legislation in British Columbia that regulates forestry operations on Aboriginal Title lands violates this principle. A direct obligation to protect Aboriginal Title lands is imposed on the federal government. Section 91 (24) the constitutional head of power conferring federal jurisdiction over “24. Indians, and Lands reserved for the Indians” which was found to extend to Aboriginal Title lands:99 “In St. Catherine’s Milling, the Privy Council held that aboriginal title was such an interest, and rejected the argument that provincial ownership operated as a limit on federal jurisdiction. The net effect of that decision, therefore, was to separate the ownership of lands held pursuant to aboriginal title from jurisdiction over those lands. Thus, although on surrender of aboriginal title the province would take absolute title, jurisdiction to accept surrenders lies with the federal government. The same can be said of extinguishment -- although on extinguishment of aboriginal title, the province would take complete title to the land, the jurisdiction to extinguish lies with the federal government.”
The result is a complex interaction between jurisdiction and ownership. Indigenous peoples own their traditional territories over which the provinces hold Crown Title in parallel, still the jurisdiction over Aboriginal Title lands lies with the federal government and Aboriginal peoples. In 1982, when the
98 99
Delgamuukw v. British Columbia (1997) 3.S.C.R., 1010, paragraph 179. Delgamuukw v. British Columbia (1997) 3.S.C.R., 1010, paragraph 175. 67
Canadian constitution was patriated, Aboriginal peoples ensured that their rights were explicitly recognized. Section 35 now extends constitutional protection to: “The existing aboriginal and treaty rights of the aboriginal peoples of Canada are hereby recognized and affirmed.” The Supreme Court found that Aboriginal Title falls within the meaning of this section:100 “133. Aboriginal title at common law is protected in its full form by s. 35(1)… S. 35(1) did not create aboriginal rights; rather, it accorded constitutional status to those rights which were existing in 1982. Since aboriginal title was a common law right whose existence was recognized well before 1982… s. 35(1) has constitutionalized it in its full form.”
Now it is clear that the federal government has a fiduciary responsibilityto safeguard Aboriginal title lands, 101 as per their exclusive federal jurisdiction under section 91(24) and section 35(1) Constitutional authority. Like the Grand Council of the Cree in the Mario Lord Case where damages are claimed for the violation of Aboriginal and Treaty rights through forest operations,102 other indigenous groups in Canada have and will file cases claiming that the federal and provincial governments are breaching their fiduciary obligation to indigenous peoples by not enforcing their Aboriginal Title and Rights. Damages will be sought for past infringement and revenue sharing schemes to be devised for future resource development. It is clear that the federal government would be responsible to set up compensation schemes specifically for Indians, whereas the province could only include Aboriginal proprietary interests in their general formula. The revenue that the governments are under a fiduciary obligation to collect are presently foregone through government (in)action and confer a benefit to forest companies in British Columbia.
100
Delgamuukw v. British Columbia (1997) 3.S.C.R., 1010, paragraph 133. R v. Adams (1996) 3 S.C.R. 101. 102 Mario Lord et al. in the Superior Court of Quebec, Court File No.: 500-05-043203-981. 68 101
3.
Ownership And Economic Aspect
This obligation is based upon the fact that Aboriginal Title now is a clearly recognized proprietary interest and constitutionally protected according to the Supreme Court of Canada: “117. I have arrived at the conclusion that the content of aboriginal title can be summarized by two propositions: first, that aboriginal title encompasses the right to exclusive use and occupation of the land held pursuant to that title for a variety of purposes, which need not be aspects of those aboriginal practices, customs and traditions which are integral to distinctive aboriginal cultures; and second, that those protected uses must not be irreconcilable with the nature of the group’s attachment to that land.” Indigenous peoples have maintained their proprietary interests in their traditional territories and have the right to use them in a variety of ways, even exclusively: “185. This is particularly so because aboriginal title encompasses an exclusive right to the use and occupation of land, i.e., to the exclusion of both non-aboriginals and members of other aboriginal nations.”
At the same time indigenous peoples are bound by the courts and by their own indigenous law not to use the land in an irreconcilably destructive way. Therefore, they also oppose unsustainable logging practices in their traditional territories. For the further discussion of the economic factors it has to be borne in mind that the Supreme Court of Canada made it very clear that103: 169. Second, aboriginal title, unlike the aboriginal right to fish for food, has an inescapably economic aspect, particularly when one takes into account the modern uses to which lands held pursuant to aboriginal title can be put. The economic aspect of aboriginal title suggests that compensation is relevant to the question of justification as well, a possibility suggested in Sparrow and which I repeated in Gladstone.
103
Delgamuukw v. British Columbia (1997) 3.S.C.R., 1010, paragraph 169. 69
The economic aspect has been furthermore built into the infringement test that will be discussed below, but the court also bears in mind a general restructuring of the allocation process:104 “What is required is that government demonstrate (at para 62) “both that the process by which it allocated the resource and the actual allocation of the resource which results from that process reflects the prior interest’ of the holders of Aboriginal title in the land. By analogy with Gladstone, this might entail, for example, that governments accommodate the participation of Aboriginal peoples in the development of the resource in British Columbia, that the conferral of fee simples for agriculture, and of lease and licences for forestry and mining reflect the prior occupation of Aboriginal title lands, that economic barriers to Aboriginal uses of their lands (e.g.: licencing fees) be somewhat reduced… No doubt, there will be difficulties in determining the precise value of Aboriginal interest in the land and any grants, leases or licences given for its exploitation. These difficult economic considerations obviously cannot be solved here.”
Instead it was held that it fell within the fiduciary obligation of the governments to set up the relevant schemes for taking indigenous proprietary interest into account. Still, both governments refuse to take the necessary steps. An independent study regarding the implications of the recognition of Aboriginal Title on correct forest practices, commissioned by the Forest Stewardship Council British Columbia found that:105 “This has huge implications for the provincial economy, particularly for the forest industry. For this reason the province refuses to admit the existence of any unproven Aboriginal Title and has taken a more aggressive stance in the courts.” Some Interior Alliance member groups are presently in court with the Province of British Columbia regarding Aboriginal Title and forestry operations, in which they argue that the province does
104
Delgamuukw v. British Columbia (1997) 3.S.C.R., 1010, paragraph 167. Stevenson Marc (2000) Legal Memorandum Regarding Principle 3 of the Forest Stewardship Council’s (FSC) Principles and Criteria, Forest Stewardship Council BC, Vancouver, p.9. Copy available upon request. 70
105
not have the right to unilaterally dispose over Aboriginal Title lands, because indigenous peoples also hold collective proprietary interests in those lands.106 In order to follow the direction of the Supreme court, the province would have to develop new schemes for consultation, in certain cases even consent, new licensing regulations that foresee redistribution to indigenous peoples or conceivably would allow indigenous peoples to set up their own licences. It should be noted that the government of British Columbia has repeatedly refused to discuss resource revenue sharing from the forestry resource with the Interior Alliance. In closing the Forest Stewardship Council study found that:107 “However, the activities suggested by the court as part of the justification are not followed. Compensation is not being paid. Consent is not a requirement for economic development. There is no priority right of access to timber for Aboriginal Communities. And, the economic barriers with respect to access to timber are not being reduced.” 4.
Infringement And Compensation
The Supreme Court of Canada foresaw compensation schemes to be set up in very specific circumstances in which infringement of Aboriginal Title might be justified according to a very strict test to be applied in every single case. First of all, Aboriginal people have to be consulted regarding the specific development and in certain cases even have to give their consent. It is the submission of the Interior Alliance Nations that at present no specific meaningful consultation processes have been set up with indigenous groups in the Interior regarding their Aboriginal Title and Rights. Even in cases where indigenous groups actively opposed developments on their lands and concerned companies called for the active involvement of the governments in the disputes, the governments refused to discuss Aboriginal Title.
106
HMQ (MOF) v. Chief Ronnie Jules et al (1999) Action No. 23914, at present before the Court of Appeal, HMQ (MOF) v. Derrickson et al., Act. No. 46440, HMQ (MOF) v. Chief Dan Wilson et al. Act. No. 23911. 107 Stevenson Marc (2000) Legal Memorandum Regarding Principle 3 of the Forest Stewardship Council’s (FSC) Principles and Criteria, Forest Stewardship Council BC, Vancouver, p.10. Copy available upon request. 71
It would therefore not even be necessary to consider the further steps in the infringement tests that are set out below, because infringement can never be justified without consultation. Still it will also be made clear that present BC forestry schemes do not meet the other criteria, especially: “161. …First, the infringement of the aboriginal right must be in furtherance of a legislative objective that is compelling and substantial…”
Compelling legislative objectives have to be clearly stated and specific regulations have to be put in place. The BC Forest Act does not even refer to Aboriginal Title let alone set out clear criteria for its infringement as demanded by the Supreme Court:108 “Parliament may not simply adopt an unstructured discretionary administrative regime which risks infringing Aboriginal rights in a substantive manner…” The British Columbia Forestry System, especially its stumpage scheme has long been found to be such a discretionary administrative regime. Even more so that the setting of the Annual Allowable Cut and the allocation of quota is left at the absolute discretion of the Chief Forester without having to take indigenous interests into account. No compensation schemes have been set up and no compensation has been paid to indigenous groups for the extraction of lumber from their Aboriginal Title lands. Due to this lack of clear regulation, consultation and compensation the continued infringement of Aboriginal Title interests cannot be justified. The economic aspect of Aboriginal Title remains unaccounted for despite the fiduciary obligation of the federal and provincial governments. The failure to provide for adequate schemes obligating forest companies whose activities clearly constitute infringements on Aboriginal Title to compensate indigenous peoples for their proprietary interest constitutes a financial contribution and provides them with an unfair economic advantage. As outlined above damages are being claimed from
72
the governments and damages for past infringements are expected to be awarded. This would further illustrate the nature of the financial contribution of the governments to companies: instead of following their constitutional obligation to set up adequate compensation schemes for Aboriginal Title, the governments make themselves liable to damage claims by indigenous groups, that will likely result in high damage payments that will not be recuperated from the companies who would have to pay for the proprietary interests of indigenous peoples in the first place. A clear benefit is conferred upon forest companies by government action. According to WTO jurisprudence,109 those actions do not even have to involve a charge on the public account, which they would if compensation had to be paid. It is enough that a benefit is conferred to the forest industry by government action, which is clearly the case, through both refusing to recognize Aboriginal Title and refusing to implement compensation schemes for the case of infringement. The government refusal to recognize Aboriginal Title is enshrined in the federal land claims policy that will be discussed in the following. 5.
Mandated Negotiations
It is noted that the Supreme Court saw infringement as a necessary evil to be tolerated under exceptional circumstances. However, it should not be made the rule or underlie public policies such as the present Comprehensive Claims Policy of the federal government which aims at the extinguishment of Aboriginal Title and as long as negotiations are underway allows the exploitation of indigenous lands to continue unaccounted. In its ongoing negotiations, the government also does not pay any compensation for past infringements. The Comprehensive Claims Policy was announced by the federal government in 1973 after the courts had first discussed the concept of Aboriginal Title. The Policy foresaw the blanket extinguishment of Aboriginal Title. As this approach was not acceptable to most Aboriginal Peoples in British Columbia
108 109
Regina v. Adams (1996) 3 S.C.R. 101. WT/DS103/R, WT/DS113/R, 17 May 1999. Panel Report, para. 7.102. 73
it was repeatedly revised changing terminology but in essence still aiming at the extinguishment of Aboriginal Title:110 “The purpose of settlement agreements is to provide certainty and clarity of rights to ownership and use of lands and resources in those areas of Canada where Aboriginal Title has not been dealt with… When the agreement comes into effect certainty will be established as to ownership rights and the application of laws.” What the government aims at is the perfection of their own Crown Title and the extinguishment of Aboriginal Title, in order to achieve “certainty,” a claim long made by companies who grew worried about the recognition of Aboriginal Title and rights by the different courts and did not want to lose their economic advantage by having to recognize and account for the proprietary interest of indigenous peoples. Since 1982, the Comprehensive Claims Policy has come under increased scrutiny, now that Aboriginal Rights were protected under the constitution. The fiduciary obligation of the federal government to protect indigenous interests now was also raised to a constitutional obligation. Still the federal government kept pushing for negotiations leading to the extinguishment of Aboriginal Title. It was also clear since 1982 that the government cannot unilaterally extinguish Aboriginal Title, it needed the consent of Aboriginal peoples. The federal government therefore set up what they call voluntary negotiation processes aiming at final settlements that would extinguish Aboriginal Title. Those processes were and at present are the only way the federal government will negotiate indigenous access to lands and resources. Otherwise the nations were denied access to their traditional territories and their inherent rights were not recognized. Due to poverty in the communities and economic incentives many indigenous groups saw themselves forced to enter into the negotiation processes set up by the federal government who justified their continued extinguishment policy with the fact that Aboriginal Title had not yet been defined by the courts.
110
Department of Indian Affairs (1986) Comprehensive Land Claims Policy, DIAND, Ottawa, Page 9. 74
The 1997 Delgamuukw Decision changed this condition. Aboriginal Title was unanimously recognized by the Supreme Court of Canada. It was also made clear that Aboriginal Title is protected under Section 35 of the Canadian Constitution. Still the federal government refused to change their policy and negotiate with the Interior Alliance Nations under the condition of the recognition of their Aboriginal Title.111 The Supreme Court of Canada had mandated a different approach reminding the federal government that:112 “Ultimately, it is through negotiated settlements, with good faith and give and take on all sides, reinforced by the judgments of this Court, that we will achieve what I stated in Van der Peet, supra, at para. 31, to be a basic purpose of s. 35(1) – A the reconciliation of the pre-existence of aboriginal societies with the sovereignty of the Crown. Let us face it, we are all here to stay.”
In order to be in good faith, negotiations have to be led on the basis of the recognition of Aboriginal Title and develop schemes for the co-management of Aboriginal Title lands. Canada’s present land rights policy violates those principles. The Interior Alliance Nations have never entered negotiations under the Comprehensive Claims Policy, because they refuse to extinguish their Aboriginal Title. It is their submission that the federal policy is not only unconstitutional, it also violates international commercial law. Instead of recognizing Aboriginal Title and accounting for it in the market prices of resources, the federal government actively chose to violate its fiduciary obligation to protect Aboriginal Title interests and thereby confers an illegal benefit on forestry companies in British Columbia who do not have to pay the full price for the resources they harvest and therefore can sell them under market value in internationally.
111 112
Letter by Minister Nault to Chief Arthur Manuel, Chairperson Interior Alliance, December 22nd, 2000. Delgamuukw v. British Columbia (1997) 3.S.C.R., 1010, paragraph 186. 75
G.
Subsidies Concerning the Environment: Externalized Environmental Cost
The Nations of the Interior insist that the recognition of Aboriginal Title has to be the basis of all future fair negotiations that would lead to the co-management of Aboriginal Title lands and forests. The Indigenous Peoples as the Traditional Owners of the Forests and Lands of the Interior have lived in a close relationship with the environment and ensured its sustainability over generations and generations. Their traditional knowledge can help protect the environment and find new sustainable ways of using resources. Indigenous land users are also the first to feel the negative impacts of large-scale developments and exploitation such as clear-cut logging on their lands that they still use in a multifaceted way. Therefore indigenous peoples can give further substance to the arguments brought forward by environmental groups that international trade law has to take human rights and environmental rights law into account. Indigenous peoples strongly support the principle of internalization of environmental cost, as the only way of ensuring sustainability and fair trade in free market economies. The Organization of Economic Cooperation and Development (OECD) was the first international trade organization to propose the “Polluter Pays Principle” in 1972113. The cost of any measures necessary to restore the environment should be reflected in the cost of the goods that cause pollution in their production. This principle has also been reinforced by the nations participating in the United Nations Earth Summit in Rio 1992 in Principle 16 of the Rio Declaration. Present logging operations in British Columbia externalize environmental cost, parts of the profit margins of the big companies over-cutting B.C. forests are drawn from the non-implementation of environmental standards that exist in competing markets, mainly the United States. The lack of equally strong rules and their efficient enforcement amounts to a countervailable subsidy in those foreign markets. The present forestry regime in British Columbia provides an incentive for the over-cutting and has disastrous effects on diverse ecosystems. Canada is
113
OECD Guiding Principles on the Environment (1972). 76
home to twenty-five percent of the world’s remaining primary forests. Ninety percent of logging in Canada occurs in old growth or primary forests. Ninety percent of this logging is done by clear cutting methods. Eighty percent of Canada’s forest products are exported to the United States. The U.S. timber trade therefore fuels the liquidation of Canada’s old growth and primary forests. The majority of forest products exported from Canada to the United States come from British Columbia.114 Indigenous peoples can give the fullest account of the negative impacts of unsustainable forest practices on their lands. Collectively they hold traditional knowledge that constitutes the most comprehensive data about the area. Elders who have still seen many untouched areas can talk about the impact of logging operations on the specific flora and fauna and very diverse ecosystems they used and continue to use in a multifaceted way. Still they are not consulted and their knowledge is not taken into account in land use planning and forest management plans.115 It remains at the discretion of the forester to set the Annual Allowable Cut and announce policies that limit the possibility to reduce the annual allowable cut to a maximum of six percent for the implementation of the Forest Practices Code, four percent for biodiversity and one percent for at-risk species protection.116 The mandatory cut levels are not informed or constrained by ecological values, rather they are set at discretion, and under pressure from the B.C. forest industry. The top ten companies control over sixty percent of the annual allowable cut in British Columbia. This excessive scope and exercise of discretion further points at the necessity to impose countervailing duties. In closing it can be said that indigenous peoples do not only share and add a further dimension to the concerns of environmental organizations, they also strengthen their legal arguments, due to national
114
For more detail see: Price, Matt (2000) Submission of the Natural Resource Defense Council to the Trade Policy Staff Committee regarding Softwood Lumber Trade between the United States and Canada, April 2000. Washington, D.C. 115 Some indigenous groups conducted Traditional and Current Use studies and made them available to the provincial government, who still does not incorporate this data that could easily be transferred into their planning systems in their land management and forestry plans. For more detail see: Adams Lake and Neskonlith Indian Bands (1999) Land Traditions of the Neskonlith and Adams Lake Shuswap, Unpublished Report. 116 Comments of the Northwest Ecosystem Alliance, Earthjustice Legal Defense Fund and Defenders of Wildlife on 77
and international legislation that recognizes and protects their collective rights to lands and resources. The non-recognition and non-implementation of those specific rights of indigenous peoples amounts to a countervailable subsidy, against which trade remedies should be imposed to secure the protection of indigenous rights and the environment. H.
Conclusions
According to the United States Code, Title 19, Chapter 4, Subtitle IV, the Department of Commerce can apply countervailing duties when a foreign government provides a financial contribution that benefits a specific industry which exports its goods to the United States, and those goods thereby compete unfairly with domestic U.S. products and harm U.S. industry. Both the governments of British Columbia and Canada provide countervailable subsidies to the B.C. forest industry that identifies itself as a clearly defined industry and is to be considered specific according to the Act. The concept of subsidies is yet to be clearly defined in international trade law. Whereas countries like Canada have insisted on a very narrow definition of subsidies, international trade tribunals, such as the Dispute Settlement Body of the United Nations, have shown tendency to interpret the terms and conditions set out under the WTO Agreement on Subsidies and Countervailing Measures and transformed into respective national legislation such as United States Code, Title 19, Chapter 4, Subtitle IV, in a broader sense. Indigenous peoples have become involved in the ongoing Softwood Lumber dispute because they have long suffered the large scale exploitation of timber resources from their lands, which results in a depletion of their traditional use areas and thereby the loss of their livelihoods. They are not compensated for their loss and their collective proprietary interest in the very forests that are exploited. Current
the Canada/U.S. Softwood Lumber Agreement, April 2000, Washington D.C. 78
Canadian legislation and policy allows Canadian forest companies to sell their timber under market value in international markets like the United States. In British Columbia, no treaties were signed with indigenous peoples, who therefore retain their inherent rights over their traditional territories. The Canadian Supreme Court recognized these inherent land rights as Aboriginal Title and furthermore found that they were protected under Section 35 of the Canadian constitution. Especially the Canadian federal government who has jurisdiction over lands reserved for Indians and by extension Aboriginal Title lands is under a fiduciary obligation to protect the interests of indigenous peoples. They would therefore be responsible to redistribute part of the revenue collected for resource exploitation to indigenous peoples and secure “adequate remuneration” for them. Aboriginal Title has an “inescapably economic aspect” its non-recognition and implementation through the respective governments has lead to actions brought by indigenous peoples suing for damages. Whilst the governments take an aggressive position in the courts destructive resource practices continue, such as wide-spread clear-cutting of Native hunting and fishing grounds. Forest companies are the beneficiaries of those delay tactics, they can continue harvesting undervalued timber and in the case of a finding against the governments they would have to account for the difference in value. Forest companies are therefore receiving financial contribution both through revenue forgone and through the provision of services under market value. Only in very specific cases can governments justifiably infringe on Aboriginal Title and rights, their actions would need a clear legislative intent, which in the case of forest legislation that does not even refer to Aboriginal Title cannot be found. Clear guidelines would have to be set up for dealing with Aboriginal interests, discretionary administrative schemes, such as the setting of the Annual Allowable Cut and Stumpage Fees in British Columbia, do not meet those criteria. Indigenous peoples would also have to be consulted in a meaningful way, whereas at present the province of British Columbia even 79
refuses to discuss resource-sharing issues with the Interior Nations and the federal government refuses to discuss issues such as Aboriginal Title. No compensation is provided although this is also a mandatory condition for justifying infringements. Clearly case-by-case negotiations regarding infringements were meant to be the exception rather than the rule, therefore the Supreme Court of Canada called for comprehensive negotiations leading to the co-management of Aboriginal Title lands. Still the federal government refuses to change its comprehensive land claims policy that aims at the extinguishment of Aboriginal Title. It is the submission of the Interior Alliance nations that this policy is not only unconstitutional but that it also violates international commercial law as it actively undervalues Aboriginal Title lands and resources. Canadian timber producers are the true beneficiaries as they liquidate the price difference internationally especially in the United States where most of the timber is exported. Indigenous peoples therefore bear the double cost, their collective proprietary interest is not “adequately remunerated” and their traditional territories and uses are destroyed. According to the Polluter Pays Principle also the cost for the environmental degradation should be borne by the lumber producers. Present Canadian logging legislation and practices allow the externalization of environmental cost. Such a waiver of environmental restrictions constitutes a subsidy program. Subsidies provided through artificially low stumpage rates that do not take Aboriginal Title into account increase the liquidation of forests in the Interior of British Columbia. Even Innovative Forest Plans mainly aim at increasing cut volumes and help channel stumpage fees back into the forest industry. The Adams Lake – Interfor example shows how individual companies are receiving clearly specific subsidies. The Interior Alliance Nations therefore requests that the United States impose the trade remedies necessary to restore fair competition and ensure that fundamental conditions for fair trade such as
80
environmental protection and the recognition of indigenous rights, especially Aboriginal Title be respected and met by the Canadian government and Canadian forest companies in the future.
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SUBMITTERS Part I is respectfully submitted this 9 day of May 2001 by: Patti Goldman Earthjustice Legal Defense Fund 705 Second Ave, Suite 203 Seattle, WA 98104-1711 (206) 343-7340, (206) 343-1526 (fax)
[email protected] Attorney for Part I submitters: Susan Casey-Lefkowitz, Senior Attorney Matt Price, Resource Specialist Natural Resources Defense Council 1200 New York Ave, N.W., Suite 400 Washington, D.C. 20005 (202) 289-2366, (202) 289-1060 (fax) (Responsible for presentation of the factual information in Part I) Bill Snape, Vice President Defenders of Wildlife 1101 14th St., N.W., Suite 1400 Washington, D.C. 20005 (202) 682-9400, (202) 682-1331 (fax) Joe Scott, Conservation Director Northwest Ecosystem Alliance 1421 Cornwall, Suite 201 Bellingham, WA 98225 (360) 671-9950, (360) 671-8429 (fax)
Part II is respectfully submitted this 9 day of May 2001 by: Geoff Quaile, Environmental Analyst Grand Council of the Crees (Eeyou Istchee) Embassy of the Cree Nation 24 Bayswater Avenue Ottawa (Ontario) K1Y 2E4, Canada (613) 761-1655, (613) 761-1388 (fax) (Responsible for presentation of the factual information in Part II) Part III is respectfully submitted this 9 day of May 2001 by: Chief Arthur Manuel, Chairperson Interior Alliance Nicole Schabus, International Relations Interior Alliance Shuswap Nation Tribal Council
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304-355 Yellowhead Highway Kamloops, British Columbia V2H 1H1, Canada (250) 828-9789, (250) 374-6331 (fax) (Responsible for presentation of the factual information in Part III)
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