Wednesday, May 03, 2006

All About CAFTA-DR. What About Bolivia?

Customs has revised the instructions to the field for dealing with CAFTA-DR claims. The one issue it does not cover is whether we have to continue to call this agreement "CAFTA-DR." It seems like we should declare the Dominican Republic to be part of Central America and call it a day at "CAFTA." Also, has anyone figured out how to pronounce USAFTA, the U.S.-Australia Free Trade Agreement. Is it "us afta" or "oo safta?"

Anyway, from a substantive point of view, this memo pretty much lays out what you need to know about making a CAFTA claim, CAFTA verifications, and retroactive textile claims. If you are interested in that stuff, read it.

A more interesting drama is playing out in Bolivia where the President Evo Morales is threatening to nationalize natural gas production facilities. According to this NY Times article, he plans to start with an audit of foreign companies while negotiating new contracts. If the negotiations don't go well (for Bolivia, that is), he may seize the companies. The Energy honcho in La Paz even used "the X word." Expropriation is such a nasty concept in international law that there are hundreds of treaties designed to protect direct foreign investment. These are generally known as "bilateral investment treaties." Similarly, NAFTA and other trade agreements tend to include provisions giving investors of member countries certain protections and rights. In NAFTA, this is all in Chapter 11 and has spawned a mini industry of Chapter 11 lawyers. It is interesting and complicated work.

Apparently, the U.S. has had a bilateral investment treaty with Bolivia in effect since 2001. I don't know who owns the natural gas production facilities in Bolivia. But, I can guarantee that if they are American companies, they are dusting off copies of that treaty right now.

2 comments:

Anonymous said...

I think that people will learn to pronounce the Australian agreement after they actually start using it...

bathmateus said...

ok ok

Bathmate