A busy year for trade lawyers in 2017

By Mariane Gravelle January 5, 20175 January 2017

A busy year for trade lawyers in 2017


The unequal distribution of benefits from globalization dominated much of world politics in 2016. The coming year will be a crucial one for trade law. 

North American Free Trade Agreement (NAFTA):

Signed in 1994 by Canada, the United States and Mexico, the North American Free Trade Agreement (NAFTA) created the largest free trade area in the world. According to GAC, “The NAFTA, being the first comprehensive trade agreement of its type, has set a valuable example of the benefits of trade liberalization for the rest of the world.”

Spurred by PEOTUS Donald Trump’s protectionist trade agenda and his promise to bring jobs back to America, we might see NAFTA being reopened to negotiation in the near future, which may or may not be in the best interest of Mexico and Canada. Renegotiation of this agreement will impact all of Canada’s trade with the USA, and Canada’s economy as a whole. One of the trade goods we’ll be watching for is softwood lumber, which is vitally important to many regions in Canada.

The Canadian-European Union Comprehensive Economic and Trade Agreement (CETA):

After years of negotiation between the European Union and Canada, a free-trade agreement (CETA) was signed on October 30, 2016. Amongst other things, the deal will abolish most tariffs on trade between Canada and the EU’s 28 member states. A second reading of this new, high-tech trade agreement was conducted in Parliament before the holiday break, and it is expected that the agreement will come into effect in Canada around mid-February 2017.  The EU will likely implement CETA on a conditional basis as some portions of it will need to be ratified by all member states individually.

With a shift from decades of more liberal trade towards a global movement of protectionism – which the U.S. is poised to join should Donald Trump get his way – Canada will undoubtedly find itself in a more enviable position than its neighbours to the South, as they won’t have a free-trade agreement with Europe.

International sanctions:

An important consideration for Canadian companies in the coming year will be the imposition of sanctions (economic or otherwise) on foreign nations. This is a uniquely interesting time regarding sanctions as Canada and the U.S. will potentially be moving in different directions:

  • An important and emerging trading partner for Canada, Iran has seen its Canadian-imposed economic sanctions repealed in February 2016. The U.S., on the other hand, has maintained its sanctions on the country (which date back to 1979). It was party to the 2015 Iran Nuclear Deal framework negotiations, which Donald Trump views as “the worst deal ever negotiated”. He has declared that his “No. 1 priority is to dismantle the disastrous deal”, which may lead to more unrest between the nations and further economic sanctions.
  • Canada and the U.S. may remain at odds over another nation: Russia. In March 2014, in response to “the gravity of Russia’s violation of the sovereignty and territorial integrity of Ukraine”, Canada’s Special Economic Measures (Russia) Regulations came into force. These regulations include asset freezes and financial prohibitions. Doubt still remains regarding Donald Trump’s future treatment of Russia. However, his pick of EXXON Mobile Corp. CEO Rex Tillerson as Secretary of State raises questions about seemingly close connection with Russian Prime Minister Vladimir Putin. It’s anyone’s guess how these developments will have an impact on foreign relations with the Eurasian nation.
  • Canada and the U.S. have long had diverging policies relating to Cuba. During his presidency, President Barack Obama took steps to renew ties with Cuba, marking the beginning of the end of the trade embargo imposed on the island nation since the 1960s. Many worry that Trump will reverse the progress made between the two nations as he has indicated that “U.S. policies towards Cuba could change if he were elected President, calling the agreement one-sided and benefitting the “Castro regime.”

Canadian Free-Trade Agreement (CFTA):

In July 2016, an Agreement-in-Principle was struck in Whitehorse, Yukon, regarding a “new” interprovincial free-trade agreement. While many details of this deal remain shrouded in mystery, according to Yukon Premier Darrell Pasloski, the new agreement “virtually covers the entire Canadian economy and will have unprecedented transparency on how the federal government, the provinces and the territories will regulate.”

Brad Duguid is Ontario’s Minister of Economic Development and is also the spokesman for the group working to finalize the CFTA (see CBC.ca). In July 2016, his office released a statement indicating that “Until the final details are ironed out, it would be premature to discuss details of the agreement. [It] will be published in full after it’s finalized by the premiers, which is likely to be this fall [2016].” At this time, we are still awaiting details of this agreement.


The UK is an important trade partner for Canada and their vote to exit the European Union will mean that our trade agreements will need to be renegotiated. Brexit will likely take a few years to fully come into effect so we can expect serious trade talks with the UK to begin 3-4 years down the road. Even so, Canada’s relations with the UK in 2017 will probably start to slowly reflect the new trade landscape.

Trans-Pacific Partnership (TPP):

The Trans-Pacific Partnership (TPP) is a trade agreement signed in February 2016 by 12 Pacific Rim countries – including Canada and the United States – that would cover approximately 40 per cent of the world’s economy. According to the BBC

The pact aims to deepen economic ties between these nations, slashing tariffs and fostering trade to boost growth. Members had also hoped to foster a closer relationship on economic policies and regulation. The agreement was designed to potentially create a new single market, something like that of the EU.

For the TPP to come into effect, the agreement needs to be ratified by all 12 signatories. However, Trump has vowed to put a stop to the TPP, until now shepherded by President Obama, on his first day in office.

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