As reported in the Scotsman:

The treaty is in [the Costa Rican] Congress, slowed down by a legal battle over whether President Oscar Arias can use a fast-track system to limit debate.

Smaller protests also took place across Costa Rica and several people were arrested when police broke through a protesters roadblock in the town of Siquirres.

Costa Rica is the only country among the DR-CAFTA parties not to have ratified the agreement. For the record, the others are:

• United States
• El Salvador
• Guatemala
• Honduras
• Nicaragua

Though there have been protests, the measure is expected to pass. This comment about the affects of the agreement caught my eye:

Some in Costa Rica worry the trade deal will lead to the privatisation of the state-run telephone company and hurt the social security system.

DR-CAFTA contains an entire chapter (13) that addresses telecoms regulation. Not only that, but there is a specific annex to chapter 13 that addresses Costa Rica. It contains section III 2. Gradual and Selective Opening of Certain Telecommunications Services which makes commitments to open up ‘private network services’, internet services, and mobile phone services on a certain schedule. This list specifically excludes public fixed line telephony, but issues concerning these areas are addressed further in the obligations for interconnection and use of physical infrastructure.

So while the state-run telephone company might not disappear, it will certainly have some competition. Will it, like BT here in the UK, lead to greater competition, and hopefully lower prices (and better quality) for consumers? This is what I see as the central issue, rather than simply wanting to preserve the state telephone system solely because they want a state telephone system.

DR-CAFTA is of course not NAFTA, but this NY Times article has an interesting critique on the immigration and development angle often brought up in relation to Free Trade Agreements. This is a look back at NAFTA and Mexico. Them immigration/development argument generally runs like this: an FTA will encourage investment, which in turn leads to higher wages and better physical infrastructure, and this results in less people seeking to immigrate (illegally). Oftentimes the end product (less illlegal immigration) is also tied to arguing that the result is stronger national security.

The article points out, in short, that the reality of NAFTA did not lead to greatly decreased illegal immigration. The key factor is that the projections on government spending to increase infrastructe did not turn out to be true. Dani Rodrik, an economist and trade specialist at Harvard’s John F. Kennedy School of Government explained:

“We have indeed had one disappointment after another on this score,” Mr. Rodrik said, noting that the same assumption about government spending is part and parcel of the agreements, now before Congress, with Columbia, Peru and Panama.

Rodrik also compared the NAFTA (and DR-CAFTA) approach to the EU:

The European Union, in contrast, assumes little about government spending on the part of economically weaker nations joining it. The union itself has hugely subsidized the improved services needed by entering countries like Portugal, Spain, Greece and Poland, rather than leave financing to the relatively meager resources of entering countries.

Though this goes into the bigger picture questions of FTAs, I note that several legal scholars who have looked at e-commerce in Latin America have noted that a solid infrastructure is required in order to expand e-commerce as well. Roads and other transportation networks are key to deliver products ordered over the internet, as well as increasing telecom infrastructure to get people on the internet in the first place.

DR-CAFTA will become a fertile ground for more comparative study in this area. As this is just the beginning of the agreement, only time will tell.

Panamanian president Martin Torrijos was in Washington DC last week. His meetings included President George W. Bush, but also included key Congressional Democrat Charles Rangel and AFL-CIO representatives to gather support for the US-Panama FTA before the expiration of the President’s Trade Promotion Authority this summer.

Panama, along with Columbia and Peru, are seeking to preserve market access to the United States that had been given to them under the Andean Trade Promotion and Drug Eradication Act (ATPDEA) (Columbia and Peru) and the Caribbean Basin Initiative (Panama) — both of which are set to expire.

Colombian, Panamanian and Peruvian exporters therefore see the FTAs as helping to guarantee permanent access to the U.S. market. The FTAs also help Latin America diversify their export offerings and reduce their dependency on only one or a few commodity items that fluctuate in prices from year to year, Bastian says. Case in point: Venezuela, which has a booming trade with the United States, but no FTA nor plans to negotiate one. Only one product category - oil and gas - accounted for 77 percent of all Venezuelan exports to the United States and with oil prices falling, trade may decline this and next year.

The Panama-US FTA contains provisions for higher IP standards, similar to CAFTA. More details on the USTR site. The full story is available at the Latin Business Chronicle.

The US business community is gearing up for a fight on passing free trade agreements.

‘We have to make sure that we as a business community win the debate,’ Christman [of the US Chamber of Commerce] said, adding, ‘It is by no means clear that we will win.’

From the Miami Herald [via bilaterals.org]

A Dominican Republic news site is blaming Texaco-Chevron for the US dragging its heels on bringing the country into the DR-CAFTA fold. [Link]

At least one site is mentioning that a Mercosur-US FTA is more likely than moves towards the Free Trade Area of the Americas. [Link].

The Hill.com has some thoughts on the Sugar lobby and their future in the US Congress.

American Crystal is one of several groups representing the U.S. sugar industry that stepped up their political activity in the wake of the fight over CAFTA. The cooperative spent a record sum — more than $1 million — on political contributions to House and Senate campaigns in the 2005-2006 election cycle, according to the PoliticalMoneyLine website. This is almost twice what the company spent during the 2002 cycle and $250,000 more than the total for 2004.

DR-CAFTA was seen as a defeat by the sugar lobby because it allowed for an increase (though small) of sugar imports. [Link].

Investment ratings firm Fitch Ratings has given El Salvador a ‘BB+’ Rating in part because of its participation in DR-CAFTA. [Link]. Wikipedia for Fitch Ratings here.

US Vice-President Dick Cheney predicts a tough fight for an extension of the Trade Promotion Authority, a law that allows for the fast tracking of free trade agreements by the President. House Ways and Means Committee Chairman Charles Rangel (D-N.Y.) predicts that the fight will involve labour and environmental standards.[Link].

Development bank the Central American Bank for Economic Integration has predicted GDP growth in Central America up by over 5% for 2007 in part because of DR-CAFTA related projects. [Link].

The DR-CAFTA agreement, in Article 15.4 Domain Names on the Internet requires that the parties provide, for their respective ccTLDs:

an appropriate procedure for the settlement of disputes based on the principles established in the Uniform Domain-Name Dispute Resolution Policy.

For those of you who don’t know, a ‘ccTLD’ is the Top Level Domain name (TLD) based on the individual nation’s country code (cc). A TLD is the last part of any domain name, i.e. the ‘.com’, ‘.uk’ or ‘.eu’. Individual countries have control over how their own ccTLD is administered, and this Article requires parties to use a specific method of resolving domain name disputes — the UDRP developed by ICANN.
The ‘UDRP-like’ requirement is in other FTAs involving the United States:

• Chile-US in Article 17.3
• Singapore-US in Article 16.3
• Australia-US in Article 17.3

In addition, a UDRP requirement can be found in the drafts of the Free Trade Area of the Americas agreement.

In the course of conducting my research, I haven’t run across much in the way of legal academic work examing the proliferation of the UDRP in the FTA context. Searches in the UK and US Westlaw databases (UK-JLR & TP-ALL), and on the general web, have turned up few mentions of the subject. This looks like at least one area that will come out of this project as being identified for further research.

Follow up posts on this issue to come.

There are really two perspectives on just what is ‘e-commerce’ within the international legal community. For those of us that focus in on teaching and researching in the field of IT law, we tend to think about the following in terms of e-commerce:

• Intellectual Property and its impact on the field, including domain name issues and peer-to-peer file sharing;
• Internet governance;
• Taxation and e-payments;
• Contracting electronically;
• Security and reliability issues, including spam and DDOS attacks;
• Authentication issues and digital signatures;
• Consumer protection issues;
• Content regulation issues, including defamation and pornography;
• Competition law aspects of e-commerce related businesses;
• Human rights issues, in particular privacy;
• Jurisdictional issues and the internet;
• Telecoms issues, such as net neutrality and the interplay between telecoms policy and the law.

However, from the trade lawyer perspective, e-commerce tends to be look at in terms of:

• Does e-commerce fit (if at all) within GATT, GATS, or both agreements?
• How do trade policies involving e-commerce fit within the policy of technology neutrality in the WTO?