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Canada Welcomes Agreement with Dow AgroSciences

Trade minister says deal reaffirms right of governments to regulate pesticide use

(No. 145 - May 27, 2011 - 2 p.m. ET) The Honourable Ed Fast, Minister of International Trade and Minister for the Asia-Pacific Gateway, today welcomed an agreement between the Government of Canada and Dow AgroSciences LLC using the investor dispute settlement mechanism in Chapter 11 of the North American Free Trade Agreement (NAFTA).

“This agreement with Dow AgroSciences demonstrates that the NAFTA dispute settlement mechanism works,” said Minister Fast.

On March 31, 2009, Dow AgroSciences LLC, a U.S. corporation, served a Notice of Arbitration under Chapter 11 seeking US$2 million in damages for losses allegedly caused by the Government of Quebec’s ban on certain uses of pesticides containing the active ingredient 2,4-D.

Under the agreement reached today, Quebec will maintain its ban on 2,4-D and Dow AgroSciences LLC will not receive any compensation. In exchange, the Government of Quebec acknowledges Health Canada’s conclusion that products containing 2,4-D do not pose an unacceptable risk to human health or to the environment, provided that the instructions on the label are followed. The agreement was reached without recourse to arbitration.

“Today’s agreement also confirms the right of governments to regulate the use of pesticides,” said Minister Fast. “This right will not be compromised by Canada’s participation in NAFTA or any other trade agreement.”

For more information on the terms of the settlement with Dow AgroSciences LLC or the dispute settlement process, please visit Cases Filed Against the Government of Canada or the Settlement of Disputes between a Party and an Investor of Another Party.

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Foreign Affairs and International Trade Canada