Fair Trade Hot Buttons

Some countries have issues with these issues

Comments (0) By Celeste Fraser Delgado and Tristram Korten Thursday, Nov 13 2003

...continued from page 1

Dispute settlement:

If the FTAA goes into effect, how will the new rules be enforced? If government A accuses government B of breaking the rules, then A can challenge any of B's laws, programs, or policies that appear to violate the FTAA. An FTAA panel would decide if there is in fact a violation. If there is, government B has three choices: change its laws; pay compensation to A; or risk heavy trade sanctions from the rest of the member countries. But a company doesn't need to get its own government on board to sue another country for violating the FTAA. Resorting to the investment rules (see Investment), a company can sue another country directly for lost profits. A corporation can, for example, make a government pay to compensate for any profits lost due to domestic environmental or health regulations.

More About

Competition Policies:

Free trade means all trade, so if a government tries to keep a monopoly over a certain national market -- whether that's oil or education -- foreign firms and investors have a right to sue for a piece of the action through a supra-national body the FTAA would set up. That doesn't mean an end to all state-run businesses; it just means that any business run by the state must allow for open competition. Critics worry that such privatization would hit the poor and the civil service, who depend on state enterprise, the hardest. $