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CANDU Sales to China

The Chrétien government’s CANDU negotiations with China and its subversion of the public consultation process should have been an election issue. The Sierra Club of Canada has made it a legal issue and intends to challenge the Canadian government in Federal Court.

On November 26, 1996, Prime Minister Chretien signed a contract with China for the sale of two CANDU reactors, a project worth 4 billion dollars. To finance Canada’s portion of the project, the government announced it was lending China 1.5 billion dollars, the largest single loan in Canada’s history for an overseas project. On Nov.6, prior to signing the contract, the federal cabinet met in a hastily arranged special session to make changes to the Environmental Assessment Act. The government changed regulations under the Act so it would not have to do a review. Under the Act, all federal government-funded projects on foreign soil must undergo complete environmental review at home if one is not required by the recipient country. The government argues that projects undertaken and funded by Crown corporations, such as the Export Development Corp., are already exempt from the Environmental Assessment Act. The government claims the new regulations “clarify” the law and that the loan is being provided by the Export Development Corporation (EDC). Apparently the loan is being administered by the EDC but is not lent by them for the simple reason that the EDC doesn’t have that kind of money to lend at this time:

In their legal challenge Elizabeth May of the Sierra Club will argue that the government triggered the Environmental Act when it passed legislation in March 1996, authorizing payment of up to $1.5 billion to finance the CANDU deal. She argues that the new regulations, which were passed into law on Nov. 7, are too late to exempt the government in this case. Moreover, she argues that the federal cabinet does not have the power to pass regulations that effectively destroy part of an important piece of environmental legislation, without any public or parliamentary debate.

At this point, the courtis hearing preliminary motions related to various aspects of the case. The Sierra Club forwarded a second motion to have several key government documents related to the sale released. The trial itself is not expected to begin until fall.

To help fund the Sierra Club’s legal challenge to force the federal government into subjecting the CANDU reactor sale to a full environmental assessment, please send as generous a donation as you can to the Sierra Club at 1 Nicholas St., #420, Ottawa ON, K1N 7B7. The Canadian Environmental Defence Fund, (CEDF), which helps to raise funds for citizens’ groups’ legal challenges is also accepting donations. They can be reached at: PO Box 15021 STN BRM B, Toronto, ON, M7Y 2Y1.

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