# An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management), Bill C-282

An Act to amend the Department of Foreign Affairs, Trade and Development Act (supply management), Bill C-282, exempts the supply-managed farm sectors (dairy, poultry, and eggs) from future trade negotiations.

## Purpose

Bill C-282 says that for dairy products, poultry, and eggs, the minister of foreign affairs, trade and development cannot increase the tariff-free import quantity or quota. Further, the minister cannot reduce the tariff applicable to these goods when they are imported in excess of the tariff-free import quota.

## Background

The NAFTA agreement brought removal of tariffs on imports between Canada, the U.S., and Mexico for almost all agricultural products, but Canadian supply-managed sectors were exempt. Very high tariffs on supply-managed goods imported into Canada were maintained (for example, 241% for liquid milk and 298% for butter), although a small amount could be imported tariff-free. Under the Canada–US–Mexico agreement (CUSMA), the U.S. was granted access to 3.6% of the Canadian dairy market, and there were concessions equivalent to 3.25% of the dairy market granted under Canada's entry into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), plus additional market access for 17,500 tons of European cheese under the CETA (the Canada-European Union trade agreement). By 2031, when the CETA, CPTPP, and CUSMA trade agreements have been fully phased in, tariff-free access for imports is estimated to be equivalent to 10% of the Canadian dairy market.
Bill C-282 is a private member's bill, so it does not represent government policy.
Bill C-282's sponsor, Bloc Québécois member Luc Thériault, said that with the CETA, CPTPP, and CUSMA trade agreements, the government "really did a number" on the supply management agricultural system and food producers and processors "are still assessing the scale of the damage caused by the implementation of these three trade agreements." The Trudeau government says that it is fully compensating producers, including paying over $4.8 billion into the supply-managed sectors, because of negotiated access under the CETA, CPTPP, and CUSMA agreements. Also, despite initial concerns about the impact of the trade agreements, farmers in supply-managed sectors are doing well and have increased production.
Prime Minister Justin Trudeau and Agriculture Minister Marie-Claude Bibeau have reiterated the governments' pledge "not to concede any further market shares under supply management during future trade negotiations."
Evidence for the credibility of this commitment was provided when the U.K., Canada's third-largest trading partner, stepped away from trade negotiations in large measure over the lack of access to Canada's supply-managed markets, especially as they relate to cheese.

## Impetus

International trade lawyer Lawrence Herman says Bill C-282 was passed by the House of Commons following intense political lobbying by dairy producers, who wield "outsized" power in Ottawa. In 2023–24, there were hundreds of meetings between the Dairy Farmers of Canada and the prime minister's office, dozens of federal departments and agencies, members of parliament and senators. Among the most prominent subjects discussed were international trade and Bill C-282.
Canada's lobby registry shows 141 actively registered advocates for the dairy industry (compared with 121 for pharmaceuticals), with spending of around $80 to $120 million annually. Supply management proponents pressure politicians, academics, and groups advocating for reform, and no major political party opposes the protection afforded to the sector.

## Response to Bill C-282
### Response by supply-managed sectors

Producers in the supply-managed dairy, egg and poultry sectors support Bill C-282. The bill's advocates argue it will provide income stability and "a living wage" for farmers. Activity from supply-managed farms supports rural economies. Also, the supply management system will privilege locally produced dairy, eggs, and poultry, consistent with the concept of food sovereignty.

### Response by trade experts

No other country in the world has legislation that prohibits its government from including specific commodities in trade negotiations, making Bill C-282 unprecedented according to the Associate Assistant Deputy Minister at the Department of Foreign Affairs, Trade and Development. Former Canadian ambassador to the World Trade Organization and chief negotiator for the NAFTA, John Weekes, said passing the bill would be "like slapping the Americans in the face," and it would ensure that reform of supply management would be a top American demand in CUSMA renegotiations.
Bill C-282 will be "extremely damaging" according to a group of 19 former trade negotiators, because it handicaps Canadian governments in the give-and-take of future trade talks. They maintain that trade talks are vital to opening up new markets and securing access for Canadian products abroad, and because the bill narrows the scope of trade negotiations, it removes the flexibility needed to secure the best deals for the country as a whole.

### Response of trading partners

Global Affairs Canada trade official Doug Forsyth said all of Canada's trading partners are watching the bill, and the U.S. reaction is unlikely to be positive. Bill C-282 could even be counterproductive for the dairy sector by making it a target of foreign negotiators. The US Ambassador expressed concern about Bill C-282 because he didn't think a good way to resolve differences was for Canada to unilaterally take an issue off the table without discussing it. Senior U.S. officials have said passing such legislation could lead the U.S. to "raise the bargaining stakes" such as by demanding concessions on supply management during the 2026 mandatory review of the CUSMA.

### Response of other industries

Industries that are competitive internationally, and rely on access to international markets, are most concerned about Bill C-282. The Canadian Agri-Food Trade Alliance, which includes growers of cereals, pulses, beef, and canola, was "profoundly disappointed" that Bill C-282 was passed in the House of Commons. It says the legislation sets a bad protectionist precedent for a country reliant on trade. The Alliance says it's "shocking" how many MPs really don't know about the bill and its ramifications.
The Canadian Cattlemen's Association opposes the bill, noting that free and open trade is instrumental to the beef industry's success, and that beef is the second largest single source of farm income in Canada. Exports support over a million agri-food jobs, and 3.3 million jobs overall in Canada, approximately ten times the 0.35 million jobs supported by supply management.
In contrast to the export-oriented industries' concerns with market access, the supply-managed dairy sector is not allowed to export much dairy product following a WTO panel ruling, because of Canada's protection of the dairy industry. Also, under the CUSMA, Canada has agreed to limit its dairy exports and, in 2023, dairy exports of $488.1 million were just 5.7% of net dairy farm cash receipts.

## Bloc Québécois ultimatum, Senate amendment, and the bill's demise

On 25 September 2024, Bloc Québécois (BQ) Leader Yves-François Blanchet said Bill C-282 (plus Bill C-319 on OAS payments) had to be passed in the Senate by 29 October 2024 or the BQ would start negotiations with the Conservatives and the NDP on toppling the Trudeau government. Senators said their examination of the bill would not be rushed, in spite of the BQ-imposed deadline. Senator Peter Harder said he wanted the Senate to give adequate consideration to Bill C-282, since the House of Commons' committee consideration was "farcical", with an obvious lack of trade representatives or experts speaking on the trade implications of the bill.
Senators on the foreign affairs committee voted 10-3 to amend Bill C-282 on 6 November 2024 so that the prohibition on supply management changes would not apply to pre-existing trade agreements (such as the existing CUSMA, due for renegotiation by 2026), or to a treaty negotiation that was underway (such as Canada's ongoing talks with the UK). Senator Peter Harder said his amendment would "de-risk" the bill.
Bill C-282 was under committee consideration in the Senate when it died on 6 January 2025 following Prime Minister Trudeau's announcement that parliament would be prorogued, thereby ending the parliamentary session.