[CTC] Interagency labor committee seeks input on NAFTA challenge procedures

[Arthur Stamoulis]

Interagency labor committee seeks input on USMCA challenge procedures
June 29, 2020 at 2:46 PM, INSIDE US TRADE
An interagency committee charged with monitoring the enforcement of the U.S.-Mexico-Canada Agreement’s labor obligations is inviting public comments on procedures for submissions alleging violations.
USMCA is slated to enter into force on Wednesday and many Democratic lawmakers and labor unions have said they plan to work hard to ensure the Trump administration holds its trading partners -- especially Mexico -- accountable for upholding its labor obligations. U.S. Trade Representative Robert Lighthizer told lawmakers earlier this month that he planned to take frequent action <https://insidetrade.com/node/169032> should any violations arise.
As outlined in Section 716 of the U.S. implementing bill, the Interagency Labor Committee is required to establish procedures for public submissions “with respect to potential failures to implement the labor obligations of a USMCA country.” A Federal Register notice <https://insidetrade.com/sites/insidetrade.com/files/documents/2020/jun/wto2020_0287.pdf> set to be published on Tuesday outlines those procedures and asks that all input be submitted by Aug. 15.
The committee’s new procedures address potential challenges brought under the USMCA labor chapter as well as a new facility-specific rapid-response tool. All petitions will be submitted to the trade arm of the Labor Department’s Bureau of International Affairs, the notice states.
To be considered, petitions submitted to the committee must include a written statement “asserting that there is a denial of rights at a covered facility (Rapid Response Petition) or any other failure to comply with the obligations of another Party under the Labor Chapter of the USMCA (Labor Chapter Petition),” the notice states.
The committee asks that each rapid-response petition include information that addresses whether “the facility to which the petition pertains is a covered facility.” The notice denotes a “covered facility” as one in Mexico that produces or supplies a good or service traded between the parties in a “priority sector.” A priority sector “produces manufactured goods, including but not limited to, aerospace products and components, autos and auto parts, cosmetic products, industrial baked goods, steel and aluminum, glass, pottery, plastic, forgings, and cement; supplies services; or involves mining,” the notice continues.
Rapid-response petitioners also should address specific provisions of Mexican laws “with which there is alleged non-compliance” and say whether relief has already been sought under the “domestic laws or procedures of Mexico.” Additionally, they should include any information on whether “any matter referenced in the petition has been addressed by, or is pending before, any international body.”
The committee plans to review such petitions within 30 days of their receipt by ILAB’s Office of Trade and Labor Affairs and determine the next steps. The Office of the U.S. Trade Representative will be informed by the committee should it decide there is sufficient evidence of a denial of rights at a covered facility “to enable the good faith invocation of enforcement mechanisms.” USTR will then initiate dispute settlement proceedings. If the committee does not find credible evidence, it will certify its decision to the Senate Finance and House Ways & Means committees as well as the petitioners.
Petitions alleging a violation of the USMCA labor chapter will follow similar guidelines, according to the notice. Specifically, petitions should include information about the particular provision in the labor chapter “with which the petitioner considers there is non-compliance.”
Among other items, the petition should document whether harm has been incurred by the petitioner and others involved.
For claims alleging a party’s failure to enforce its labor laws, the petition should address whether “there has been a sustained or recurring course of action or inaction of non-enforcement of labor law by another Party” and if the situation “occurred in a manner affecting trade or investment.”
Such language led to a U.S. loss, in 2017, in a nine-year labor dispute against Guatemalan labor practices filed under the Dominican Republic-Central America FTA. USMCA included footnotes that clarified those provisions and shifted the burden of proof to the respondents, among other changes, which analysts have touted as welcome improvements <https://insidetrade.com/node/167850>.
The committee plans to review labor chapter petitions within 20 days of receipt by the OTLA. If the committee determines that further review is warranted, it will “conduct a further review focused exclusively on determining, not later than 60 days after the date of submission, whether there is sufficient, credible evidence that the other Party is not in compliance with its labor obligations, for purposes of initiating enforcement action under Chapter 23 or Chapter 31 of the USMCA,” the notice adds.
“If the Committee determines that there is sufficient, credible evidence that the other Party is not in compliance with its obligations under the Labor Chapter for purposes of initiating enforcement action under Chapter 23 or Chapter 31 of the USMCA, the Committee will immediately so inform the U.S. Trade Representative.” -- Isabelle Icso(iicso at iwpnews.com <mailto:iicso at iwpnews.com>)
Arthur Stamoulis
Citizens Trade Campaign
(202) 494-8826




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