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No promise to renegotiate 6,000-page TPP deal, new Liberal trade minister says

The General Motors automobile assembly plant in Oshawa, Ont. Auto makers are upset fuming over a provision in the Trans-Pacific Partnership that would phase out tariffs on imported vehicles.

Moe Doiron/The Globe and Mail

The new Liberal government in Ottawa is making no promises about renegotiating a massive Pacific Rim trade deal now that the text of the Trans-Pacific Partnership agreement has been made public.

Instead, Justin Trudeau's international trade minister is urging Canadians to review the accord, which numbers 6,000 pages. The text was released early Thursday.

"I really want to invite all Canadians – not everyone is going to read the full 6,000-page text -- but please familiarize yourself with it," Chrystia Freeland told reporters in Ottawa.

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Ms. Freeland said the Liberals plan to consult Canadians on the deal before Parliament ratifies it.

But she made no mention of asking the 11 other Trans-Pacific Partner countries to reopen the deal and make changes to what was negotiated by Stephen Harper's defeated Conservative government.

Ms. Freeland encouraged Canadians to send Ottawa their comments on the deal. "We will review those, we will have serious consultations."

The new trade minister said the Liberals are strong supporters of foreign trade.

"We believe in trade, we understand that Canada is a trading nation. We are the 11 sized economy in the world, the prosperity of the middle-class, which is a central part of our agenda, depends very much on Canada being fully plugged-into the global economy," Ms. Freeland said.

"Having said that, a real leitmotiv of the Trudeau is going to be openness and consultation. That hasn't happened yet with this agreement. We weren't the ones negotiating it. What we really want to happen is a period for Canadians to become familiar with this agreement."

She said there will be a full Parliamentary debate on the deal before it's ratified.

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The deal, which will provide duty-free trade on most goods, reduce tariffs on others and provide mutual recognition of many regulations, took five years and 19 formal rounds of talks to forge, and its members account for 40 per cent of the world economy.

New details of the pact are beginning to emerge. For instance, Investment Canada scrutiny of foreign takeovers of Canadian companies will be reduced.  Investments in Canadian companies of less than $1.5-billion by companies from countries that have signed the TPP will not be subject to Investment Canada examination, the text of the agreement says.

The current threshold for a takeover bid to be examined is $600-million. That is scheduled to rise to $800-million by 2017 and $1-billion by 2019 under current Investment Canada Act rules.

The new rule does not apply to cultural businesses. Acquisitions of Canadian companies by state-owned enterprises in TPP countries will be subject to review at a value of $369-million.

The text also reveals that Canada has retained the ability to restrict foreign investment in some key Canadian companies, including Air Canada and uranium miner Cameco Inc.

The higher threshold for an Investment Canada review of foreign takeovers is also a feature of the Canada-European Union free-trade agreement, but that deal has yet to be put in place.

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The increase to $1.5-billion is not "hugely significant," trade lawyer Lawrence Herman said Thursday, given that the level is already set to rise to $1-billion by 2019. The TPP is expected to come into force in 2017 once all approvals are granted.

"I think the new government will want the whole TPP looked at by a parliamentary committee," Mr. Herman said, but he believes that Canada should approve it.

Foreign investors in Air Canada have been limited to 25-per-cent ownership since the airline was privatized by the federal government.

The deal, containing hundreds of pages of provisions governing the trade of a vast range of goods, including cars, cheese and wine, must now be ratified by all 12 countries involved, and in many cases, that will be a multistep process. While most of the countries are expected to approve it, a newly elected Liberal government in Canada and electoral politics at play in the United States could mean long delays and risks to passage.

Negotiations on the deal, which will set common standards on issues ranging from workers' rights to intellectual property protection, was kept largely from public scrutiny, angering transparency advocates concerned over its broad implications.

When the agreement was announced during the federal election campaign, then-prime minister Stephen Harper hailed it as a landmark deal. But a few industries – namely the auto and dairy sectors – decried it, saying it would threaten the livelihoods of thousands of workers.

The dairy industry expressed concerns that the TPP would dismantle supply management, a system that limits foreign competition through tariffs in an effort to protect domestic production.

Auto workers were fuming over a provision that would phase out tariffs on imported vehicles.

Copyright activists also said they feared that Canadians could face lawsuits, fines or worse for ripping CDs or uploading animated GIF files and called on Prime Minister Justin Trudeau to act.

After the tentative deal was announced, Mr. Harper promised a $4.3-billion package for dairy farmers and $1-billion for the auto sector in an effort to boost exports and protect jobs in those industries.

The White House said that in a phone call, Mr. Trudeau and President Barack Obama discussed "the need to move forward with implementing the high standards" of the TPP, and Japan has also said it is keen to move forward with Canada on the deal.

With reports from The Canadian Press, Bloomberg and Reuters

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About the Authors
Parliamentary reporter

Steven Chase has covered federal politics in Ottawa for The Globe since mid-2001, arriving there a few months before 9/11. He previously worked in the paper's Vancouver and Calgary bureaus. Prior to that, he reported on Alberta politics for the Calgary Herald and the Calgary Sun, and on national issues for Alberta Report. More

Auto and Steel Industry Reporter

Greg Keenan has covered the automotive and steel industries for The Globe and Mail since 1995. He also writes about broader manufacturing trends. He is a graduate of the University of Toronto and of the University of Western Ontario School of Journalism. More

Parliamentary reporter

Daniel Leblanc studied political science at the University of Ottawa and journalism at Carleton University. He became a full-time reporter in 1998, first at the Ottawa Citizen and then in the Ottawa bureau of The Globe and Mail. More

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