Dow AgroSciences is considering using the controversial investor-protection provisions of the North American free-trade agreement to seek compensation from the federal government over Quebec's ban on the cosmetic use of pesticides.
The company, a maker of the weed-killer 2,4-D, filed a notice of intent to submit a claim to arbitration under NAFTA in late August. The 27-page legal action was posted yesterday on the Foreign Affairs website, where it is listed as a dispute to which Canada is a party.
In its notice, Dow says the Quebec ban outlawing the use of bug and weed sprays for merely appearances' sake around homes breaches legal protections owed by Canada to U.S. investors under the trade agreement.
NAFTA has provisions, known as Chapter 11, that restrict the ability of a country to take measures "tantamount to nationalization or expropriation" of an investment from a firm from another NAFA member. Besides Canada, the United States and Mexico are in the trade pact.
The Indianapolis-based company, whose 2,4-D is a standard ingredient in many commercial weed sprays, is seeking compensation of not less than $2-million, plus legal costs and yet-to-be specified damages.
Dow's legal brief accuses the Quebec government of implementing a pesticide ban that "is not based on science" and was applied to 2,4-D "without providing any meaningful opportunity" for the company to make its case that the herbicide is safe.
Quebec instituted its pesticide ban in 2006, and Dow's action could have wide-ranging impacts. Ontario has recently adopted a similar measure, as have many municipalities, based on a precautionary public-health approach of minimizing exposures to these chemicals.
Although pesticide bans are spreading in Canada, the degree of health risk posed by the sprays is highly contentious. While such respected groups as the Canadian Cancer Society have argued in favour of bans, Health Canada says the pesticides it allows on the market are safe, if used as directed.
Ironically, Health Canada issued its assessment backing the safety of 2,4-D in May, shortly after Ontario said it would follow Quebec's lead by banning the lawn and garden chemicals.
Full Story: http://www.theglobeandmail.com/servlet/story/RTGAM.2008
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