Potential Obama US Trade Representative designate Xavier Becerra is a member of the House Ways and Means Committee. In July 2005, he signed a dissenting views section of the committee's report on the Dominican Republic - Central American Free Trade Agreement (DR-CAFTA) trade agreement.
Simon Lester, at the International Economic Law and Policy Blog, suggests that the dissent may provide some good insights into Becerra's thinking about trade: Becerra's Trade Views.
Here are some extracts and key issues from Lester's post:
Labor
The CAFTA agreement should have been changed to bring parties'...
...(1) ... labor laws into compliance with the basic standards of the International Labor Organization (ILO) within 3 years; and (2) subject this commitment to meet ILO labor standards and other obligations... to the regular dispute settlement mechanisms that apply to all other commercial provisions in the agreement.
Add to that, the U.S. should provide...
....meaningful technical assistance to assist the CAFTA countries to meet these goals.
Public health
...Article 15.10.1 of the CAFTA requires parties to protect certain test data submitted to obtain regulatory marketing approval of a drug. The provisions operate as follows: if a government requires submission of test data in order to obtain marketing approval for a drug (e.g., FDA approval), the government may not allow any other company to use these test data as the basis of obtaining marketing approval for a similar drug for a period of 5 years. The company first submitting the data has the right to prevent anyone else from using those data to enter the market for that period. Test data rights are separate and distinct from patent rights, and can exist for drugs not covered by a patent.
The key issue raised by the test data requirements in the CAFTA is whether they can be waived if a CAFTA country wants to approve a producer other than the test data owner to produce and sell a drug in the CAFTA country during the test data protection period. The following example illustrates the issue:
Assume Guatemala decides that it needs to increase the supply of an HIV/AIDS drug in its market. Company A owns the patent on the HIV/AIDS drug, and also is the only producer to have obtained marketing approval for the drug in the Guatemalan market. If Guatemala is unable to convince Company A to produce more of the HIV/AIDS drug at a reasonable price, Guatemala could issue a compulsory license to another drug manufacturer, Company B. However, the compulsory license, which is allowed under the FTA, is an exception only for the patent rights related to the HIV/AIDS drug. The compulsory license does not affect Company A's right to prevent any other company from receiving marketing approval for the drug based on the data it submitted.
Obviously, if the United States invoked its right to test data protection as to the drug in question, the compulsory license would be useless--and Guatemala's right under specified circumstances pursuant to WTO rules to issue such a license would be defeated....
Environment
...The agreement includes no benchmarks for countries to meet in improving their environmental laws and practices, and instead requires only that the countries enforce their existing laws. In addition, although the CAFTA includes commitments by the countries to engage in cooperative activities to improve and conserve the environment, these obligations are largely rhetorical, as the CAFTA also includes no commitments for funding such activities.
Investor protections
...The investor-state [dispute settlement - Ben] mechanism can be a useful tool to ensure that U.S. investors overseas are protected against unfair treatment.
However, if not properly crafted to reflect current U.S. laws, the investor-state mechanism can provide foreign investors greater rights than U.S. investors in the U.S. market. Congress recognized the potential for this problem during debate over the Trade Act of 2002 (P.L. 107-210), and included a mandate to USTR that U.S. trade agreements ensure that `foreign investors in the United States are not accorded greater substantive rights with respect to investment protections than [U.S.] investors in the United States.'
Unfortunately, the CAFTA still leaves out key elements of U.S. law, notwithstanding that it arguably is an improvement over the standard contained at Chapter 11 of the NAFTA. The result is to empower CAFTA panels to issue decisions that could go well beyond U.S. law--allowing foreign investors to receive greater rights than U.S. investors in the U.S. market. Given the aggressive reasoning of some arbitration panels that have considered claims brought under the NAFTA, it is particularly important that the investor-state provisions included in free trade agreements closely track U.S. constitutional and Supreme Court jurisprudence in order to ensure that legitimate U.S. laws and regulations are not threatened--and there is no chilling effect on local, state or federal authorities.
Redirect USTR focus from bilateral to multilateral negotiations:
...we urge the Administration to recognize that the most important U.S. trade priorities should be the ongoing negotiations in the World Trade Organization and opening markets that achieve the largest gains for Americans. We are concerned that the Administration has focused too heavily on FTAs. In the case of CAFTA, we are concerned that Congress as well has had to dedicate enormous resources and attention to this agreement at the expense of other important trade priorities, largely because the CAFTA negotiated by the Administration could not attract broad, bipartisan support.
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