Charming Betsy, Chevron, and the World Trade Organization: Thoughts on the Interpretive Effect of International Trade Law

By Williams, Michael F. | Law and Policy in International Business, Spring 2001 | Go to article overview

Charming Betsy, Chevron, and the World Trade Organization: Thoughts on the Interpretive Effect of International Trade Law


Williams, Michael F., Law and Policy in International Business


I. INTRODUCTION

"The capitalist achievement," Joseph Schumpeter observed, "does not typically consist in providing more silk stockings for queens, but in bringing them within the reach of factory girls."(1) Ironically, Schumpeter's analytical accuracy has eroded the persuasive force of his maxim. Today, deprivations of panty hose and other important commodities are inconceivable in the United States. People tend to thank Wal-Mart and other retailers for low prices. They offer no gratitude to the abstract notion of economic freedom. Considering the prosperity that free trade has generated, trade as an institution garners little regard among its beneficiaries.

In a similar manner, the United States accords little deference to international trade law. The General Agreement on Tariffs and Trade ("GATT") and the World Trade Organization ("WTO") have facilitated economic growth,(2) increased efficiency,(3) and established the rule of law as an organizing principle for international trade.(4) However, the United States, which championed the development of the WTO/GATT(5) internationally, tends to regard the agreement with suspicion and hostility.(6)

The decision of the U.S. Court of Appeals for the Federal Circuit in Suramerica de Aleaciones Laminadas, C.A. v. United States,(7) which upheld an administrative action that contravened U.S. obligations under the WTO/GATT, suggests that aversion to the WTO/GATT exists in the judiciary as well. The court ignored the Charming Betsy canon, a principle that requires courts to construe laws as consistent with international law whenever possible. This Note explores whether the application of the Charming Betsy canon should have precipitated a different result in Suramerica.

Part I of this Note surveys the domestic legal status of the WTO/GATT. Part II examines the Suramerica decision and describes its implications for international trade law. Part III introduces the Charming Betsy canon, explaining the canon's methodology and reviewing its relation to international trade agreements. Part IV reconsiders Suramerica in light of the Charming Betsy canon.

II. THE STATUS OF THE WTO/GATT IN U.S. DOMESTIC LAW

The WTO/GATT is a multilateral international agreement intended to reduce distortions in global commerce.(8) Some commentators praise the agreement as an indication that national governments have come to reject protectionism and isolationism.(9) Others maintain that the WTO/GATT is merely a natural consequence of interest-oriented politics.(10) Their motivations for entering the WTO/GATT aside, 140 states have approved the agreement,(11) and the WTO/GATT legally binds its member states under international law.(12)

While the WTO/GATT is effective law on the international plane, its status as domestic law in the United States is not entirely clear. The WTO/GATT is a valid executive agreement, an international treaty incorporated into domestic law via statute.(13) Congress enacted the terms of the WTO/GATT under its authority to regulate foreign commerce,(14) and approval of the WTO/GATT satisfied the constitutional prerequisites of federal law.(15) As such, the agreement should be identical to other federal statutes in its domestic legal effect.(16) However, the authority of the WTO/GATT is clouded by provisions of the Uruguay Round Agreements Act(17) and the Trade Agreements Act of 1979(18) that purport to clarify the agreement's relation to U.S. law. The provisions, codified at 19 U.S.C. [subsections] 2504(a) and 3512, prevent terms of the WTO/GATT that conflict with existing federal laws from having domestic effect.(19)

Section 2504(a) distinguishes the WTO/GATT from other federal laws by disfavoring the agreement under the later-in-time rule, which mandates that valid treaties, statutes, and executive agreements supersede prior inconsistent legislation.(20) In applying this rule, the judiciary construes new laws to avoid conflict with existing laws. …

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