Document Type

Article

Disciplines

International Law

Abstract

On January 1, 1989 the Canada-United States Free Trade Agreement' (FTA) went into effect, thereby. integrating the United States and Canada into one single economic market of 265 million people. The agreement will create the world's largest free trade area, affecting trade of approximately $125 billion.

An integral part of the FTA is its provision for settlement of disputes between the two countries. Although Canada and the United States share the largest undefended border in the world, the two countries are not without their squabbles, particularly in the realm of trade." The dispute settlement mechanism was incorporated into chapter 19 of the agreement in an attempt to maintain some relief from unfair trade practices while the two countries seek to develop a new bilateral system to replace current unfair trade laws.5 The striking aspect of the dispute-settlement mechanism is its removal of all judicial review of U.S. antidumping (AD) and countervailing duty (CVD) determinations from the United States federal court system. A binational panel system, rather than the domestic judicial courts of the two countries, will determine whether these trade remedy laws are applied in proper compliance with the nations' laws.

An international agreement which attempts to replace U.S. federal court judicial review with binational panel review raises three serious questions under U.S. constitutional law.7 First, does substitution of binational panel review for the U.S. domestic system of judicial review deprive a litigant of due process under the fifth amendment? Second, does the presence of Canadian citizens on the binational panels violate the Appointments Clause of article II of the U.S. Constitution? Finally, and most importantly, does the FTA's preclusion of panel decisions from U.S. judicial review violate article III of the U.S. Constitution?

This Note will discuss these constitutional questions raised by the dispute settlement mechanism of the FTA. First, the paper will briefly overview U.S. antidumping and countervailing duty laws. The specific provisions of chapter 19 of the FTA will then be outlined. In addition, the article will briefly discuss chapter 19 and conclude that it probably does not violate the Constitution's Due Process Clause or Appointments Clause. The Note will then turn to the most significant constitutional issue: whether the replacement of U.S. judicial review with binational panel review violates article III of the U.S. Constitution. The Framers' intent to create an independent judiciary by specifically providing for a judiciary with article III protections will be examined. Furthermore, the paper will discuss the "public rights" exception to article III review and assert that, with respect to American importers, the binational panels do not adjudicate public rights and, therefore, these panels cannot be sustained under this exception. Indeed, importers have at stake a private property interest when the government requires them to pay a duty on imports. Under the FTA, such governmental action which affects individual rights under the Constitution will not be subjected to constitutionally mandated scrutiny by an article III court. Finally, it will be argued that international law does not support chapter 19 of the agreement. The Note will conclude that, despite important international considerations, chapter 19 of the FTA contravenes article III of the U.S. Constitution insofar as it fails to provide for article III review of panel decisions which will adjudicate importers' constitutionally-protected property rights, as directed by the United States Constitution.

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