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June 05, 2007

What Are the Implications of the Trade Treaty Between the Administration and Congress?

Sungjoon Cho of Chicago-Kent School School of Law has written a short note on the May 10 trade agreement between the Administration and Congress: The Bush Administration and Democrats Reach a Bipartisan Deal on Trade Policy (American Society of International Law e-newsletter "Insights", May 31).

A couple of points.  The agreement may or may not require renegotiation of completed agreements -  it may often be possible to handle key issues through other mechanisms, such as interpretive "memorandums of understanding."

Also - with respect to the labor and environmental guidelines, how likely is it that one government will try and impose sanctions on the other for failure to comply?  These are most likely to be violated by private parties, not the governments themselves.  Moreover,

...The government is only responsible for its non-enforcement through a persistent pattern, i.e., “through a sustained or recurring course of action or inaction.”

Therefore, individual labor and environmental scandals, standing alone, may not be attributable to the government, no matter how grave they may be.  Moreover, only those breaches occurring “in a manner affecting trade or investment” can be remedied under the template.

These conditions appear in NAFTA, and have not been "triggered."

For more on the contents of the agreement: The content of changes in U.S. trade negotiating policy (May 11, with later revisions), and on commentary on the agreement here: The Administration's trade treaty with Congress (May 24, with lots of later revisions).

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