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How P3s Could Make Local Governments Vulnerable to CUPA

Steven Shrybman

January 01, 2010

Capital Regional District Wastewater Treatment Program – How the use of P3s could make local governments vulnerable to CUPA

This legal opinion, prepared for the Canadian Union of Public Employees’ B.C. Division, concludes that the public private partnerships (P3s) currently being considered for the Capital Regional District’s new sewage treatment would make local governments more vulnerable to the restrictions of the Canada-United States Procurement Agreement (CUPA).

The CUPA contains temporary rules that will make it difficult for the Capital Regional District to achieve environmental protection and local economic development objectives. The best way to avoid the CUPA requirements is to go with conventional public procurement rather than a P3.

The opinion identifies a number of vulnerabilities for the Capital Regional District – including being prohibited from specifying some portion of local or even Canadian goods, services and labour and from supporting a market for innovative Canadian environmental or energy design or Canadian green technologies. He also cautions that the agreement creates a litigation risk arising from the rights US companies have under the CUPA to challenge both the method and the terms of certain Capital Regional District procurements.


Steven Shrybman