JAY GOLDBERG: Canada must avoid pitfalls of EU marriage of convenience

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An ‘ever-closer association.’ That’s the language Prime Minister Mark Carney and European Commission President Ursula von der Leyen settled on in describing what they envision as the future of the relationship between Canada and the European Union.

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In the weeks leading up to Carney and von der Leyen’s summit, there was much speculation the two political figures would announce the beginning of the process to admit Canada to the European Union as its first ‘associate member.’ Apparently, that language was kiboshed by multiple powerful EU member states that objected to the idea of creating a new associate category of EU membership. Regardless of the wording, von der Leyen is reportedly working toward ‘association without accession’ for Canada, seeking the closest possible ties between the EU and Carney’s Canada. Many Canadians, according to the polls, are very much open to the idea of a closer association with the EU, particularly in the wake of U.S. President Donald Trump’s pro-tariff trade policies.

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Marriage of convenience

But before Canada rushes into a marriage of convenience, it’s worth considering what an ‘ever-closer association’ with the EU might mean.

What, exactly, would Canada achieve?

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Many have pointed to the need for more trade and investment between Canada and the EU.

In fact, advocates of Carney’s envisioned new special relationship see this as the primary selling point.

Those folks aren’t wrong.

But here’s the thing: former prime minister Stephen Harper negotiated a free trade deal with the EU well over a decade ago. Yet 10 EU member states have yet to ratify the agreement, including G7 allies France and Italy.

When a new couple is dating, friends and family often advise that they move in together before getting hitched to see if the relationship might work.

Wouldn’t it make sense, then, for Carney to try to get the EU to ratify its free trade deal with Canada as a first step before considering tying the knot through an ‘ever-closer association’?

As with any relationship, there’s also the question of what Canada might have to give up, or accept, as a condition of an ‘ever-closer association.’

Norway, for example, is a member of the European Economic Area but not a full member of the EU. The country has to accept many EU laws and pay into the EU but has no representation at the table as a formal member state.

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Is a Norway-like association really in Canada’s best economic interests?

After all, the EU is notorious for rules that stifle innovation, competition, and free markets, with businesses bogged down in endless amounts of red tape.

Should Canada go the association route, Canada may have to accept all kinds of rules without having a say in them.

For example, the EU has imposed a Corporate Sustainability Due Diligence Directive (CSDDD), which the Hudson Institute calls “a tax on access to the EU market.”

Through a complex web of reporting requirements and regulations, the EU has raised compliance costs on large companies that do business in the EU, as well as businesses that supply them.

If Canada aligns its regulations more closely with Brussels, would it adopt similar rules?

Doing so would effectively tax access to the Canadian market — the last thing Canada’s struggling economy needs. Then there’s the carbon tax question. The proposed relationship includes aligning strategies and standards when it comes to ‘carbon pricing’ and ‘industrial decarbonization.’

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Should Canada really consider aligning our environmental policies with those of Europe? That would effectively mean surrendering any competitive ground Canada has on energy and natural resources, a sector that is a key pillar of Canada’s economy.

Carney won a lot of support by breaking from Trudeau-era policies on the environment, such as consumer carbon taxes. Aligning with the EU on climate policies would take Canada back to unpopular Trudeau-era policies that would both hurt our economy and Canadians’ pocketbooks.

‘Pursuing cooperation’

Canada is already pursuing cooperation with the EU on defence, energy, AI, critical minerals, technology, and financial services. And there’s a decade-old free trade agreement that still needs ratification.

Closer cooperation on these files ought to be pursued first before Canada even considers any kind of formal relationship with the EU.

After all, why would Canada give up its regulatory independence in pursuit of stronger ties with Europe if such stronger ties could be achieved without surrendering our regulatory independence? Icelanders recently voted against resuming talks to join the EU in a national referendum for precisely this reason.

The bottom line is ‘association without accession’ would be a mistake for Canada. We would give up a lot for gains that are already on the table.

Freer trade, yes. More investment, absolutely. But EU-style rules that would kill jobs, hike carbon taxes, and make Canada less competitive on the global stage?

Carney should think twice.

Jay Goldberg is the North American Affairs Manager at the Consumer Choice Center

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