EU Reacts to Quebec Asbestos Loan 

by Laurie Kazan-Allen



A statement published today (September 21, 2012) by the European Commission (EC) confirms the Commission's awareness of and concern regarding a multimillion dollar loan promised to international developers of a new Canadian asbestos mining facility at the Jeffrey Chrysotile mine. The clarification of the EC's position came about in a response to a question asked in July 2012 by Stephen Hughes, a Member of the European Parliament (MEP) representing the Durham and Blaydon European Constituency. Since Mr. Hughes became an MEP in 1984 he has raised the asbestos issue in Brussels on numerous occasions. This week he participated at a Parliamentary asbestos hearing before the Committee on Employment and Social Affairs which heard evidence regarding the ongoing epidemic of asbestos-related diseases in Member States.1

In his question to the Commission, Hughes raised the issue of the proposed Quebec loan and asked the Commission to consider whether this government support constituted an illegal subsidy under World Trade Organziation rules.2 Responding on behalf of the EC, spokesperson De Guicht pointed out that the loan would be “subject to the rules of the World Trade Organization (WTO) on subsidies … should it be shown to be a 'specific subsidy' under Articles 1 and 2 of the Agreement and to be either prohibited or causing adverse effects to the interests of another WTO Member.” [LINK to PDF]

Since the September 4, 2012 election of a new Government, the $58 million loan promised by former Premier Charest has been in limbo as the incoming Premier Pauline Marois has promised to revoke government support for the asbestos industry. Nevertheless, a public relations spokesperson for Balcorp Ltd., one of the backers of the mining scheme, claims that despite the change in Quebec's political leadership, it is still very much business as usual at the mine.3 Reacting to the collapse of political and financial support from Quebec and Ottawa, Balcorp's mouthpiece Guy Versailles said:

“I don't want to lack respect against politicans, but I must say that a company cannot govern itself according to a declaration made during an election… This does not change the standing agreement we have with the Government of Quebec.”4

Given the almost total collapse of public and government support for the asbestos industry, it seems likely that Versailles' comments are a ploy to bolster the hopes of beleaguered investors.

Some long-time observers of the Canadian asbestos industry remain unconvinced that the tragic saga of Canada's asbestos industry has really come to an end. Should there, however, be yet another reversal of government policy, Canada might well find itself dragged before the World Trade Organization to defend the unfair advantage bestowed upon the asbestos industry by the government subsidy. The European Commission statement published today is yet another reason for the Quebec loan to be revoked. Premier Marois, Europe is watching you!

September 21, 2012


1 Kazan-Allen L. Asbestos Issues at Heart of European Debate. September 20, 2012.



4 Blatchford A. Canada to stop defending asbestos, striking blow to once-mighty industry. September 15, 2012.



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