NAFTA: Free Trade and the Rule of Law

Article excerpt

AS "trade follows the flag," so lawyers follow trade. With the ever expanding trade in goods and services around the world, business lawyers are shuttling across international borders like bills of lading.

Today a growing number of American lawyers aren't just advocates: They're also avocats, abogados, and whatever the Chinese, Japanese, and Timbuktese equivalents are.

It's hardly surprising, therefore, that many lawyers in the United States, and the American Bar Association, support the North American Free Trade Agreement, the proposed treaty that would lower trade barriers between the US and Mexico (complementing the recent Free Trade Agreement between the US and Canada). Commercial lawyers in the US anticipate that the ratification of NAFTA would significantly expand trade across the Rio Grande, and that this in turn would raise the demand for lawyers with trade expertise.

"An increase in trade and investment with Mexico inevitably means an increase in legal services," says Gary Horlick, a trade lawyer in the Washington office of O'Melveny & Myers. "Lawyers help facilitate international trade and investment by explaining the rules. There will be so many rule changes in Mexico under NAFTA that US companies will want American counsel there as well as Mexican counsel."

A few US law firms - especially Texas firms - already have outposts in Mexico City to service American business clients there, and the number of such outposts, or of other kinds of affiliations between US and Mexican lawyers, would likely rise quickly in the wake of NAFTA, just as American lawyers have had a steadily growing presence in Europe as trans-Atlantic commerce has expanded. More recently, though still in small numbers, US lawyers have been setting up shop in Hong Kong, Tokyo, Beijing, and elsewhere around the Pacific Rim to keep abreast of trade growth.

NAFTA would throw work to trade litigators as well as to business counsel. Among the pact's most innovative features are elaborate and unprecedented mechanisms to speed the resolution of trade disputes. Lawyers would serve on the arbitration panels established under the treaty and also would represent aggrieved clients bringing disputes to the panels. …