Canadian government is ordered to pay U.S. PCB-recycling firm damages under NAFTA Chapter 11 Tuesday, October 22, 2002 By Steven Chase A NAFTA tribunal has ordered Ottawa to pay more than $8.2-million in compensation to an Ohio waste-recycling company that had suffered under a temporary ban on exports from Canada of polychlorinated biphenyls (PCBs). S.D. Myers Inc. ,a small family-owned company that treats PCBs in the United States, had sued Ottawa under Chapter 11 of the North American free-trade agreement for wrecking its Canadian business through the interim ban. Yesterday's award includes more than $6-million in damages plus interest. The NAFTA ruling stems from November, 1995, when then-environment minister Sheila Copps banned the export of Canadian PCB waste. The ban was later lifted in February, 1997, but S.D. Myers argued the interim prohibition on exports wiped out more than $50-million in PCB export work it had lined up in Canada. Barry Appleton, a Toronto lawyer for S.D. Myers, celebrated the award as a victory for small companies because NAFTA compensated the Ohio firm for discrimination and poor treatment at the hands of the Canadian government. '[The ban] was one of the clearest examples of anti-American policy making we've ever had in Canada,' Mr. Appleton said. 'The regulation was specifically targeted against S.D. Myers.' Canadian government reaction to the award was muted. International Trade Minister Pierre Pettigrew said only that Ottawa would have to examine the decision. 'This is an extremely complex case, and we must study the ruling closely,' Mr. Pettigrew said. 'It is particularly important to do so in light of the fact that we have asked the federal court to review this case.' The award comes nearly two years after the international arbitration tribunal initially decided in November, 2000, that Canada broke two obligations under NAFTA when it shut the borders to southbound shipments of PCBs. It found that Canada treated U.S. investors less favourably than its own. Dana Myers, president of S.D. Myers, lauded the decision. 'The NAFTA tribunal recognized the effort that our company put into the Canadian market, and that was totally lost due to the unfair treatment caused by the policies of the former Canadian minister of the environment, Sheila Copps.' Ms. Copps, now Heritage Minister, declined to discuss the tribunal award yesterday. 'I don't know anything about that,' she told reporters in Ottawa. 'I didn't shut the borders. It was a cabinet decision.' Ottawa has challenged the November, 2000, decision, asking the Federal Court of Canada to review it, and it is waiting for the court to determine a hearing date. S.D. Myers initially asked the NAFTA tribunal for about $20-million in damages, but Mr. Appleton said the award of more than $8-million sufficiently recognizes the profit that the Ohio company would have made from the more than $50-million in contracts that were sideswiped by the ban. Ottawa sought to assure Canadians that the tribunal decision of November, 2000, doesn't detract from Canada's ability to regulate the 'safe movement and disposal of hazardous wastes,' saying it only applied to the interim ban. Mr. Appleton said Canada's mistreatment of S.D. Myers undermines Ottawa's attempts to seek fair treatment from the United States in the current softwood lumber dispute under NAFTA. 'The NAFTA tribunal has said the government singled out this particular company, whose only crime was they were on the wrong side of the U.S. border,' he said.