Environmental and public interests groups condemned a recent NAFTA tribunal decision that ruled against the Canadian government's right to ban the export of hazardous waste.
"This decision is another example of the environment losing out to corporate interest and the government's ability to sign international environmental agreements," said Jennifer Story from the Council of Canadians.
Also a sidebar following the story gives a short history of PCB's and their use and ban in North America.

Environmental and public interests groups condemned a recent NAFTA tribunal decision that ruled against the Canadian government's right to ban the export of hazardous waste.
"This decision is another example of the environment losing out to corporate interest and the government's ability to sign international environmental agreements," said Jennifer Story from the Council of Canadians.
Story is referring to the Nov. 13, 2000 ruling by a North American Free Trade Agreement tribunal against the Canadian government brought on by S.D. Myers Inc., an American PCB disposal company based out of Ohio. S.D. Myers filed a NAFTA Chapter 11 claim in October 1998 stating that the Canadian government discriminated against them by preventing the export of PCBs from Canada into the United States as well as denied them the right to due process and economic right.
A three-member tribunal panel agreed, ruling that the Canadian government violated international law concerning national treatment and the minimum standard treatment of the Investment Chapter of the NAFTA treaty (commonly referred to as Chapter 11).

Tapping in Canadian market

In 1993, S.D. Myers incorporated a Canadian subsidiary in the hopes of tapping into the large PCB remediation market in Canada. S.D. Myers quickly began lobbying the U.S. government for approval to import PCBs into the U.S. for destruction at their hazardous waste disposal complex in Ohio.
In October 1995, the U.S. Environmental Protection Agency, through the use of an enforcement discretion, approved S.D. Myers' request for import rights and allowed for the importing of PCBs from Canada between Nov. 15, 1995 to Dec. 31, 1997.
The Canadian government, however, had concerns. Legally, the term "enforcement discretion" is not defined within U.S. law. So although technically still illegal, the EPA was allowing S.D. Myers to import PCBs into the U.S. by not enforcing the law.
Additionally, the Canadian government was concerned that the PCBs may not be disposed of in an environmentally friendly manner and that once movement of the materials was allowed to take place, the border might effectively be closed again to PCB import/export without warning. (An action that ultimately did take place in July 1997 when a U.S. Court ruled that the "enforcement discretion" was unlawful.)
As a result, in February 1996, then-Minister of Environment Sheila Copps signed a final order banning the export of PCBs from Canada unless they were PCBs in Canada owned by an American business.
It is this order that S.D. Myers claimed effectively severed their ability to provide commercial PCB remediation services as the company would need to buy off PCBs from other Canadian companies in order eventually ship it to the U.S. This forced the company to reduce operations in Canada.
S.D. Myers contended that Copps implemented the order banning PCB exports strictly to conserve Canadian commercial interests, a thought rejected by the Sierra Club.
"Companies always claim discrimination by commercial protectionism rather than accept some things as environmental protectionism," said Christine Elwell, senior policy analyst for the Sierra Club of Canada.

NAFTA tribunal disagrees

Yet the NAFTA tribunal disagreed, stating that "the evidence established that Canada's policy was shaped to a very great extent by the desire and intent to protect and promote the market share of enterprises that would carry out the destruction of PCB's in Canada and that were owned by Canadian nationals."
In fact, the tribunal went further, stating "the protectionist intent of the lead minister in this matter was reflected in decision-making at every stage that led to the ban."
The tribunal has deferred the decision on the amount of the monetary award payable to S.D. Myers until a later phase of arbitration. The compensation should be in the millions of dollars.
S.D. Myers could not be reached for comment before press time.
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PCBs: a short history

by Derron Bodell
Polychlorinated Biphenyl is a synthetic chemical compound that was used as an inert, fire-resistant and insulating material. As a result of its properties, it was mainly employed in electrical equipment and as insulation.
PCB slowly degrades and in order for it to be destroyed it must be incinerated at extreme temperatures (1,600 degrees Fahrenheit) or by chemical processing at government certified processing facilities within Canada and the United States.
Early in the 1970's PCBs were found to be highly toxic, harming both animals and humans alike. As a result, Canada and the U.S. banned the future production of PCBs in 1973.
In 1977, Canada added PCBs to the toxic substance list under the Environmental Contaminants Act that effectively prohibited the import of PCBs into Canada.
In 1980, the U.S. closed its borders to the importing and exporting of PCBs completely.
In the 1980s, S.D. Myers Inc. began its PCB remediation services in the U.S. PCB remediation consists of the analyzing, transportation, extraction and destruction of PCB laden equipment and oil.
In 1986, Canada and the U.S. signed the Trans-boundary Agreement detailing that hazardous material could be transported across borders to be disposed of at the nearest disposal facility. The Canadian government, though, believed that PCBs were not covered in the agreement because the U.S. never considered PCB as hazardous material.
In 1989, the Basel Agreement was established to provide rules for countries to follow in the trans-border movement and destruction of hazardous materials in order to protect human health and the environment. Some 143 countries signed the Basel Agreement, including Canada. The U.S., although registered, has yet to ratify its decision citing four objections to the agreement in principal, which does not make them full adherents to the accord.
In 1990, the PCB Waste Export Regulation was implemented in Canada banning the export of PCBs to all countries other than the U.S., where the prior approval of the U.S. Environmental Protection Agency was required.
In 1993, S.D. Myers Canada was incorporated so that S.D. Myers could tap into the large PCB remediation market in Canada as the American market was dwindling.
In October 1995, the EPA, through the use of an enforcement discretion, opened the U.S. border to import of PCBs by S.D. Meyers Inc. from Nov. 15, 1995 to Dec. 31, 1997.
In November 1995, the Minister of Environment signed an interim order banning the export of PCBs from Canada unless they were PCBs in Canada owned by a U.S. business. In February 1996, the interim order became a final order.
In February 1997, the Minister of Environment reversed its previous order and opened the Canadian border to export of PCBs.
In July 1997, the U.S. Court of Appeals ruled that the enforcement discretion used to allow for the import of PCBs was unlawful and closed the U.S. border to the import/export of PCBs.
Ultimately, the Canadian and U.S. borders were opened for the import/export of PCB's for only five months (from February to July 1997).
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