The International Politics of Agricultural Trade: Canadian-American Relations in a Global Agricultural Context

By Theodore H. Cohn | Go to book overview
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Binational Dispute Settlement

Chapter 19 of the BFT accord deals with binational dispute settlement, which is relevant to agriculture because of the large number of trade relief cases involving agricultural products. Canada viewed dispute settlement as the single most important negotiating issue since it wanted more assured access to the U.S. market. While Canada wanted a binding arbitration panel to resolve all trade complaints, it did not achieve this objective. Instead, trade complaints are to proceed through normal domestic procedures in each country, with access to a binational dispute panel only after the domestic process has been completed.

The binational dispute-settlement panels will examine the trade rules in each country and determine whether or not the country in question has made a decision in accordance with its own laws. The panels will consist of five members, with each government choosing two panelists and both jointly choosing the fifth; findings of the panels are to be binding on both governments. The panel system will exist for five to seven years, during which time the United States and Canada will try to develop a new set of joint rules for the use of antidumping and countervailing duties. If no agreement is reached after the seven years, either country can terminate the BFT accord on six months' notice. In the interim, the U.S. and Canada may continue to bring trade relief cases against each other's imports under current domestic laws. Canadian critics have argued that the binational dispute-settlement mechanism does not provide assured access to the U.S. market, but it is clear that a stronger provision would have raised serious constitutional questions in the U.S. Congress. Indeed, a former senior official in the U.S. Department of Agriculture stated that "it seems rather far-fetched for Canada to think that it might be inoculated against retaliation by the U.S. in response to real and imaginary threats to U.S. farm interests."128


CONCLUSIONS

Conclusions were discussed above regarding agricultural trade barriers, and these comments focus primarily on efforts to break down trade barriers through the BFT agreement. The most important variable affecting the BFT negotiating process in agriculture was the lack of regime norms and rules. Thus, a former U.S. agricultural policy-maker has stated that

agriculture is different . . . because the rules for agriculture, in essence, now say that any policy instruments are allowed as long as the outcome is agreeable to the contracting parties. Thus, GATT disputes over nonagri

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