Support for UN declaration on native rights may spell trouble for Canada’s resource sector

Commentary, Tom Flanagan

The new Liberal government says it will implement the 2007 United Nations Declaration on the Rights of Indigenous Peoples. It’s no surprise, as the Liberals campaigned on it. Nonetheless, there is great potential for mischief here because the sweeping language of the declaration is inconsistent with well-established principles of Canadian property law.

Article 32 of the declaration would require Canada to obtain from indigenous peoples “free and informed consent prior to the approval of any project affecting their lands or territories” for developing natural resources. The words sound nice, but they raise three big problems in Canadian law.

First, aboriginal ownership of land in Canada is poorly defined. Land-surrender treaties were never negotiated in the Atlantic provinces, most of Quebec and most of British Columbia. Does that mean aboriginal peoples still own the land in those regions? Perhaps, but the Supreme Court of Canada is still working on the question. Treaties were signed in Ontario and the three Prairie provinces; but the Assembly of First Nations maintains the First Nations surrendered the land only to “the depth of a plow” for agriculture and still own all subsurface resources.

The concept of “traditional territory” has never been legally defined, so claims to traditional territory often overlap among First Nations and Métis. If the UN declaration is adopted, any natural resource project, almost everywhere in Canada, could be greeted by one or more native groups – First Nations or Métis, or perhaps both – arguing that nothing can proceed without their consent.

Second, the Supreme Court of Canada has proclaimed a duty to consult on development projects where aboriginal title may still exist, or where First Nations have harvesting rights on Crown land that was surrendered through treaty. But in every major decision, the court has also emphasized that the right to be consulted is not the same as a power of veto. Development can still go ahead against the wishes of a First Nation if consultation has been adequate.

Like other politicians, native leaders tend to pick and choose among court decisions, emphasizing what they like and ignoring the rest, so they typically claim possession of a veto. But that is not what the Supreme Court has said. Adopting the UN declaration could convert a right to be consulted into a right of veto, which is ominous to say the least for natural resource industries, including mining, oil and gas, forestry and hydroelectric power – major elements of the Canadian economy.

Third, a veto power would be particularly threatening to corridor projects, such as pipelines, railways, highways and power lines. Anything of this type already encounters claims of “traditional territory” from dozens of First Nations and Métis communities. To be of any use, a road or pipeline must go all the way from beginning to end. In the larger society, Canadian governments solve such problems with the power of expropriation, the threat of which usually brings holdouts to accept reasonable compensation at market prices. But the UN declaration does not mention expropriation for the common good, or anything like it.

The duty to consult First Nations, combined with the environmental movement, has already made it extremely difficult to build new pipelines and frontier roads in Canada; overlaying an aboriginal veto on top of the right to be consulted would create a bleak outlook for Canada’s resource industries. They might continue with existing operations, but how much would they invest in future?

Resource industries are a leading private-sector employer of aboriginal people in Canada and the only hope for many First Nations in remote locations to work their way out of poverty. It is not in anyone’s interest to handicap Canada’s resource industries by endowing aboriginal leaders with veto power over all proposals.