It may not be a new idea, but recent developments remind me how the status of US trade agreements as executive agreements, and the consequent (lack of a) role for them in US domestic law, has hindered the United States’ ability to comply with its international obligations, and generated unnecessary disputes that have undermined US public support for trade agreements.
First example, the USMCA trucking safeguard. The USMCA allows limitations where necessary to address “material harm” to US truckers, with material harm defined as “a significant loss in the share of the US market for long-haul truck services”. But US implementing legislation defines “material harm” as “a significant loss in the share of the United States market or relevant sub-market for cross-border long-haul trucking services”. In effect, Congress redefined the domestic industry in a way that facilitates affirmative findings. When Mexico objected to implementing regulations as inconsistent with the USMCA, the US ITC responded in effect that it must follow US law, not the USMCA. Should we be surprised that Mexico is now threatening to bring a dispute settlement case?
Second example, expedited reviews in countervailing duty investigations. The SCM Agreement requires that Members provide for expedited reviews of CV actions, the URAA’s Statement of Administrative Action recognizes that requirement, and Commerce (apparently noting an oversight) issued regulations providing for them. Recently, however, the Court of International Trade has ruled that Commerce lacked the legal authority to issue such regulations, as the URAA does not specifically provide for them, thus leaving the United States in flagrante delicto in respect of this clear WTO requirement.
Third example, non-market economy status for Russia in US anti-dumping investigations. The United States granted Russia market economy status back in 2002, before Russia acceded to the WTO, and nothing in the Russian Protocol of Accession envisions differential treatment for Russia in AD investigations. However, Commerce recently initiated an AD investigation on Urea from Russia, and is considering whether Russia should be treated as a non-market economy under US law. Although the closing date for public comment has not yet arrived, I predict with confidence that the WTO-consistency of an NME designation for Russia will be raised, and that Commerce will respond that it is bound by US law, not the WTO Agreement.
My point is not that the courts and agencies have got it wrong (indeed, the URAA is quite clear about the relationship between the WTO Agreement and US law), but that a system where the US’ international obligations are in effect legally irrelevant in interpreting US law (the Charming Betsy doctrine notwithstanding) places the US Government in a position where it has little, if any, ability to adjust its behavior to take into account international norms. Not surprisingly, the outcome is frequent dispute settlement challenges, lost cases, and difficulty implementing when we lose. In short, the United States is unable to engage in dispute avoidance, or to comply when avoidance fails. Those frequent cases, and losses, in turn have undermined public confidence in international rules.
