The Council of Canadians and the Canadian Union of Postal Workers (CUPW) have asked the Ontario Superior Court of Justice to find investment rules under the North American Free Trade Agreement (NAFTA) unconstitutional under Canadian law.

According to a report by the Canadian Association of Labour Media (CALM), the court case began in 2001 in response to a complaint by the United Parcel Service (UPS) that Canada's public postal system violates NAFTA rules.

Maude Barlow, national chairperson of the Council of Canadians, said: "UPS claims that simply by having a public postal system Canada is allowing unfair competition."

"By this logic," Barlow said, "every public service from health care to education to the CBC could face similar lawsuits. We don't intend to let foreign corporations destroy our public services without a fight."

CUPW Pres. Deborah Bourque said that NAFTA "allows foreign corporations to put Canadian laws, policies and services like the post office on trial without giving the people affected the right to participate in the process. We are in court to object to an international trade agreement that undermines our democratic rights."

According to CALM, the case is the first time a court will consider whether international trade rules that allow foreign corporations to sue governments are constitutional under national law.

Steven Shrybman, a trade lawyer involved in the fight, said companies have already appealed to NAFTA tribunals to try to overturn environmental laws in Canada and the United States and land use powers of local governments in Mexico.

"Under NAFTA, the government has delegated the powers of Canada's courts to international tribunals that operate outside the boundaries of Canadian law," Shrybman said. "This is certainly undemocratic, and, we plan to argue, unconstitutional as well."