Originally Published: April 20, 2020
Canada is liable to compensate Chinese companies for losses incurred due to the coronavirus disease (COVID-19) pandemic, under the terms of a trade agreement the Harper government signed with China.
Former Prime Minister Stephen Harper’s Conservative government signed the Agreement Between the Government of Canada and the Government of the People’s Republic of China for the Promotion and Reciprocal Protection of Investments[1], commonly known as FIPA, with China on September 9, 2012 without even releasing the full text to the public.
The Harper government ratified the agreement two year later in October 2014 despite warnings from experts and labour, human rights and environmental advocates that the agreement was detrimental to Canada’s interests.
“Article 11 of the FIPA states that if Chinese firms in Canada suffer losses due to ‘war, state of national emergency, insurrection, riot or other similar events,’ they can sue the Canadian government for compensations,” explains Mukesh Khanal of University of Calgary’s The School of Public Policy. “War and insurrection are well-understood concepts. War is an armed combat or conflict within a country or between different countries. An insurrection is a violent rebellion by the people against their own government. However, a riot or a national emergency needs to be defined clearly.”
However, Canadian firms may not be able to sue China for compensation easily.
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