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Much of the discussion about Canada and the Far North focuses on "Arctic sovereignty." And in the minds of many, this evokes the image of a threat to Canada. Somehow, the country is in danger of losing its sovereignty in the Arctic. If we don't "use" the Arctic, we will "lose" it.

This whole notion is misplaced. Focusing on it obscures real future challenges in the Arctic and opportunities for Canada to redefine itself as an Arctic leader. It's time to move beyond our perpetually defensive Arctic posture.

What is the loss we fear? We cannot lose land. No one is challenging Canada's sovereignty over its Arctic land territories; the disagreement with Denmark over Hans Island is a somewhat minuscule issue in the whole Arctic panorama. We cannot lose our rights over the waters and the seabed in our 200 nautical-mile exclusive economic zone. Again, no one is challenging that right and our boundary in the Beaufort Sea with the United States could be readily resolved through arbitration. We cannot lose our right to an extended continental shelf beyond 200 nautical miles under the Arctic Ocean. We have to define the limits of that shelf, which is what we are doing.

Furthermore, there is no gigantic "grab for resources" in the Arctic, although the Russian flag-dropping stunt two years ago fuelled such speculation. But the event was a publicity side play in the course of scientific investigations to determine the outer limits of the Russian continental shelf. Indeed, scientific research of this nature is what all of the Arctic-basin states are currently doing, Canada included. And this is not a free-for-all with each state trying to out-manoeuvre the other. There is a framework of legal rules and mechanisms for determining the extent of the shelf and for dealing with overlapping shelves between states, and all of the Arctic states are operating within them.

Of course, there is the question of whether the waters of the Northwest Passage are the internal waters of Canada and governed solely by the laws of Canada or an international strait governed by international rules. There is a legal framework, too, for dealing with that question and the issues are clear. The United States could at any time challenge Canada's position in court, but it has never shown any interest in doing so. Moreover, there is nothing that Canada can do under the guise of "protecting sovereignty" that will make Canada's legal position any stronger.

To be sure, Canada could abandon sovereignty, turn its back on the Northwest Passage and let ships go through at will, ensuring that the waters will ultimately become an international strait. But that has never been or will be the policy of a Canadian government. Instead, Canada must continue what it is doing - ensuring that we have the infrastructure to manage a vast area of land and water and ensuring that it acts in the interests of, and in close co-operation with, the indigenous peoples who inhabit the area.

It is time, therefore, to stop talking about "Arctic sovereignty" and look at the real challenges. The melting of Arctic ice makes the potential for commercial shipping in these waters a reality, carrying with it the need for proper management of shipping (and not just in the Northwest Passage), as well as measures to deal with marine pollution. The prospect for resource extraction on the outer continental shelves of the Arctic states also raises the potential for navigational hazards and environmental harm.

These are challenges for the five Arctic-basin states - Canada, the United States, Russia, Denmark/Greenland, and Norway. They must develop regimes for environmental protection. They must co-ordinate approaches to shipping and environmental regulation, both within and beyond areas of national jurisdiction. If they do not, non-Arctic states will assert an interest in managing the area. In the long run, co-operation by these five states is the best way to secure Arctic security.

Canada has a substantial Arctic coastline that carries significant rights to the resources of the waters and seabed off that coast. It is a major regional player. It is time for Canada to stop worrying about losing Arctic sovereignty and act instead as an Arctic leader, giving voice to the indigenous peoples of the North and engaging the United States in forging a new regional partnership to act as responsible stewards for this unique and fragile environment, for the benefit of all Arctic peoples.

Donald McRae is Hyman Soloway professor of business and trade law at the University of Ottawa. This article is drawn from his contribution to Carleton University's Canada-U.S. Engagement Project.