Since I found out about it recently, it has seemed to me that there is not enough commentary, blogging, scholarship, etc. about Canada's Agreement on Internal Trade. Maybe there's lots of it, and I'm just not looking in the right places, but I haven't come across it anyway. So, to fill that void, I want to make an effort to highlight legal developments in this area. Unfortunately, I don't know much about the law here. On the other hand, it looks pretty similar to GATT/WTO law, so I'm hoping I can fake it.
The latest is a panel report relating to an Ontario law that allegedly hindered trade in accounting services from other provinces. Here is the panel's explanation of the measure:
On November 6, 2009, Ontario issued a Notice of Measure claiming that material differences exist among the provinces/territories in respect of the competencies and standards established for licensing or authorization to practise public accounting and therefore, to protect consumers, the qualifications of individual applicants would be assessed against Ontario’s public accounting certification requirements.
In other words, if you're an accountant in a province other than Ontario, you cannot automatically practice in Ontario. Ontario will check your qualifications first.
The main allegation was under Article 706.1 of the Agreement, which states:
Subject to paragraphs 2, 3, 4 and 6 and Article 708, any worker certified for an occupation by a regulatory authority of a Party shall, upon application, be certified for that occupation by each other Party which regulates that occupation without any requirement for any material additional training, experience, examinations or assessments as part of that certification procedure.
This provision seems to be a mandatory mutual recognition clause of sorts. Basicaly, if you are certified as an accountant in one province, you are automatically certified in other provinces. The panel found that Ontario's measure violated this provision, on the following basis:
Ontario’s Notice of Measure of November 6, 2009 requires that the qualifications of CGAs from all other provinces be assessed against Ontario’s public accounting certification requirements. Article 706.1 is quite clear that certification of a CGA from another province or territory shall occur “without any requirement for any material additional training, experience, examinations or assessments as part of that certification procedure”.
The use of the word “shall” in Article 706.1 does not allow discretion on the part of the regulatory authority. The applicant “shall” be certified without any requirement for an assessment.
The Panel finds that Ontario’s Notice of Measure is inconsistent with Article 706.1 of the AIT.
So, there was a violation of 706.1. But the real fight in the dispute was about whether the measure was justified by an "exception":
The Respondent contends its Notice of Measure is consistent with Article 708 and therefore with the AIT. The main provisions of Article 708 as it relates to this dispute read:
1. Where it is established that a measure falling within the scope and coverage of this Chapter is inconsistent with Article 401, Article 402, Article 403 or Article 705, or paragraphs 1, 2 or 5 of Article 706, that measure is still permissible under this Chapter where it can be demonstrated that:
(a) the purpose of the measure is to achieve a legitimate objective;
(b) the measure is not more restrictive to labour mobility than necessary to achieve that legitimate objective; and
(c) the measure does not create a disguised restriction to labour mobility.
2. For greater certainty, for purposes of the application of paragraph 1(b) of Article 708 to paragraph 1, 2 or 5 of Article 706, a mere difference between the certification requirements of a Party related to academic credentials, education, training, experience, examination or assessment methods and those of any other Party is not, by itself, sufficient to justify the imposition of additional education, training, experience, examination or assessment requirements as necessary to achieve a legitimate objective. In the case of a difference related to academic credentials, education, training or experience, the Party seeking to impose an additional requirement must be able to demonstrate that any such difference results in an actual material deficiency in skill, area of knowledge or ability. As an example, the imposition of a requirement for additional, education, training or experience may be justified under paragraph (1)(b) where a Party can demonstrate that:
(a) there is a material difference between the scope of practice of the occupation for which the worker is seeking to be certified in its territory and the scope of practice of the occupation for which the worker has been certified by the regulatory authority of another Party; and
(b) as a result of that difference, the worker lacks a critical skill, area of knowledge or ability required to perform the scope of practice of the occupation for which the worker seeks to be certified.
The definition of "legitimate objective" appears in Article 711:
legitimate objective means one or more of the following objectives pursued within the territory of a Party:
(a) public security and safety;
(b) public order;
(c) protection of human, animal or plant life or health;
(d) protection of the environment;
(e) consumer protection;
(f) protection of the health, safety and well-being of workers;
(g) provision of adequate social and health services to all its geographic regions; and
(h) programs for disadvantaged groups;
Here, consumer protection was at issue. The Panel said that the central question here is: “Is the inconsistency of the Ontario Notice of Measure under 706.1 saved by Article 708." It then explained:
The Respondent appears to claim that its market is unique. It states it has “more high risk consumers than Manitoba because it has over 80% of Canada’s capital markets and international companies” and that “Ontario is the financial markets capital of Canada”. In its oral presentation, it reiterates these claims referring to the Toronto Stock Exchange, the presence of larger private concerns using substantial amounts of bank credit, private investment funds and institutional investors. It also refers to substantial layers of government and the size of government entities (e.g. if Toronto were a province it would be the third largest in Canada).
The Panel, after reviewing the issue, concludes that there is no meaningful difference in the nature of the Ontario market compared to the rest of Canada and that the nature and scope of practice of public accounting in Ontario is no different from the rest of Canada.
The Respondent claims Ontario consumers will be hurt if CGAs from Manitoba and other provinces and territories, certified to practise public accounting in their jurisdictions, are allowed to practise public accounting in Ontario. Nowhere does it provide any solid facts to support that claim. ...
Its conclusion: "The Panel finds that the Ontario Notice of Measure concerning Public Accountants cannot be justified under the provisions of Article 708 as necessary to achieve a legitimate objective."
As to the impact on trade:
The Panel concurs with the Complainant and Intervenors that Ontario’s Notice of Measure has had the effect of restricting the ability of CGAs from Manitoba and the rest of Canada to practise public accounting in Ontario and therefore impairs trade. The Panel has reviewed previous Panel rulingsand concludes that it is now well established that denial of opportunity in and of itself constitutes injury and, further, the Complainant is not required to find a specific amount of injury.
The Panel finds that the Notice of Measure has impaired or would impair internal trade and has caused or would cause injury.
And finally, the recommendations:
1) The Panel recommends that the Respondent withdraw its Notice of Measure concerning Public Accountants.
2) The Panel recommends that the Respondent ensure that its regulatory authorities comply with Ontario’s AIT obligations and, in particular, allow CGAs certified to practise public accounting in the jurisdictions of all Parties to be certified to practise public accounting in Ontario without any requirement for any material additional training, experience, examinations or assessments.
It all looks similar to GATT/WTO law, with just a few differences here and there.