Havana to NAFTA and the continuing need for an effective dispute settlement mechanism

A review is undertaken of the dispute settlement mechanisms in the Havana Charter, GATT, Uruguay Round, Canada-United States Free Trade Agreement, North American Free Trade Agreement and its Side Agreements.;The GATT dispute settlement mechanism remains a non-binding, diplomatic mechanism with a remedy based upon retaliation. The Uruguay Round Understanding does introduce an effective appellate procedure.;The FTA introduced an innovative antidumping/countervailing dispute mechanism in Chapter 19 which replaces the process of domestic judicial review of final administrative duty investigations. Chapter 19 is an improvement due to the concentration of trade and legal expertise in a five member panel. Its weakness is that the binational panels are limited by the standard of judicial review.;NAFTA duplicates the FTA dispute settlement mechanisms and extends them to Mexico in return for the substantive reform. The most notable developments are firstly, the provisions respecting arbitration in the areas of Investment and Financial Services, and, secondly, the unique remedy of monetary enforcement assessments, which is a damages remedy, included in the Environmental and Labour Side Agreements.;The premise of the paper is that significant change will not occur if the Working Groups undertake a clause-by-clause analysis of the antidumping and countervailing duty codes and understandings. Significant reform will occur only if the Working Groups reject the status quo and try to re-adjust the regimes and place them on a new theoretical footing.;Policy alternatives for reform are set out respecting substantive law reform and institutional reform. Antipredation/competition law principles are reviewed as an appropriate replacement for the existing antidumping regime. Canada is encouraged to re-think its use of subsidies. Institutional reform is reviewed from the standpoint of placing effective limits upon the exercise of administrative discretion. In the alternative, the broadening of the Chapter 19 process is recommended. (Abstract shortened by UMI.).