National laws, NAFTA panels and multilateral privisions: sovereignty or supranational rules at bay?

Abstract

Extending a previous investigation of farm dispute settlement under the Canadian-U.S. Free Trade Agreement of 1989 to include the North American Free Trade Agreement of 1994, this study inquires if regionalism in this part of the world threatens the sovereignty of national trade laws and multilateral provisions. The adjudication process, spelled out by Chapter 19 of the two free trade agreements, is singled out and disaggregated into four stages for analysis. This, in turn, allows for (a) a reassessment of the sovereignty-supranational theoretical debate; and (b) undertaking a comparative study of the national trade relief laws in Canada, Mexico, and the United States. Whereas extant works, almost exclusively of disputes under G.A.T.T., find that supranational rules influence outcomes more than the pursuit of sovereign interests by states, the preliminary findings of this study suggest that both forces are equally strong in North America. By and large, they suggest that reciprocal relations between states, regional entities, and multilateral organizations are necessary for the viable operation of each; yet this necessity may, in the long-term, constrain the multilateral organization more than the regional. This interpenetrating relationship is unique, and the source of institutional innovations of relevance to the pursuit of both state sovereignty and supranationalism.