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GN, NTI settle NNI squabble

No more grandfathering after April 1, 2003

JIM BELL

Lawyers representing Nunavut Tunngavik Inc. and the government of Nunavut won’t be facing off in court after all.

The squabbling organizations announced this week that they’ve reached a settlement in their dispute over the Nunavut government’s unilateral one-year extension of "Nunavut business" status to a group of 35 long-established companies.

The deal is made up of three elements:

• A promise by the government of Nunavut not to extend its grandfathering agreement — which provides "Nunavut business" status to non-compliant companies — beyond March 31, 2003;

• A detailed process for consulting NTI if the government proposes changes or adds new policies for carrying out its obligations under Article 24 of the Nunavut land claims agreement, and;

• the appointment of an "advisor" to suggest solutions to the current impasse over the mandate of a board that would hear appeals on NNI contract awards.

"I’m sure it will improve a lot of things, and that the GN will consult with NTI on any changes in the future," James Eetoolook, NTI’s first vice-president, said this week. "So hopefully they will live up to their commitment in the future."

The "Nunavut business" label gives certain firms a 14-per-cent competitive advantage when bidding on Nunavut government tenders. ("Inuit-owned" companies may claim an extra three per cent, while "local" companies may claim another three-per-cent advantage on top of that.)

It’s similar to the "northern business" designation used under the Northwest Territories’ old business incentive policy, or "BIP."

On April 1, 2000, the GN replaced the BIP with the NNI to comply with Article 24 of the Nunavut land claims agreement.

About three dozen companies lost that status because they didn’t meet some or all parts of the NNI policy’s definition of "Nunavut business," such as having a resident manager in Nunavut or majority ownership by Nunavut residents.

That group includes Inuit-owned firms such as Norterra, and non-Inuit-owned firms such as Tower Arctic and Northern stores. To ease their way into compliance with the new rules, the GN gave them a two-year grace period, ending March 31, 2002. That provision became known as "the grandfathering clause."

But on April 5, after intense lobbying from some of those companies, the GN extended the grandfathering period by one year.

NTI officials denounced the move, calling it a violation of the Nunavut land claims agreement.

So on May 3, NTI lawyers gave notice that they would ask the Nunavut court of justice to quash the GN’s one-year extension of the grace period.

Eetoolook said NTI’s executive did this as a last resort, after they exhausted all other ways of changing the GN’s mind.

"We tried everything — through correspondence, through meetings of our staffs, through meetings at the political level, and even through the media, and so at the end, the executive, with the blessings of the board, decided to take the course that we have made, and agreed that if we can settle anything out of court, we will settle," Eetoolook said.

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