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Responsible Trade Program:
The Language of International Trade

Introduction
Today's trade rules are not designed to protect workers, the environment or public health. They are written by corporate lawyers and trade bureaucrats with no citizen input and very little Congressional oversight. Current trade rules allow companies to set up shop wherever labor costs are lowest and environmental rules weakest, increasing toxic pollution in countries least able to responsibly dispose of it and eliminating jobs in countries with strong labor laws, such as the U.S.

The free trade regime also has dispute-settlement bodies that allow foreign corporations to sue governments when they feel that particular laws and regulations violate a trade agreement. Since the establishment of this dispute resolution system, numerous cases have been brought forward that have the potential to negatively impact the environment and public health.

International trade rules governing procurement can block even the most benign efforts of Congress, federal agencies, and even state governments to act responsibly when making purchasing decisions. Commonsense policies aimed to encourage economic development and environmental protection are prohibited by trade agreement procurement rules designed to keep countries from "discriminating" in their purchasing decisions.


Fast Track Negotiating Authority

Fast Track Negotiating Authority (a.k.a. Trade Promotion Authority) allows the executive branch to negotiate and sign international trade agreements without the prior approval of Congress. After terms have already been decided by the executive branch, Congress is allowed only a "yes" or "no" vote on international trade agreements with no amendments permitted. Each body of Congress, the House and the Senate, has a maximum of 20 hours to debate a trade agreement, which can pass with only a simple majority vote. The entire Congressional approval process, from introduction of the agreement to vote, may take no longer than 90 days.

Though this system was adopted under the auspices of expediting the negotiation process, in reality, it inverts the traditional legislative process while facilitating the passage of trade agreements that have not been adequately debated by Congress.

Despite the expiration of Fast Track authority in June of 2007, detrimental trade agreements like the Dominican Republic-Central America-U.S. Free Trade Agreement (CAFTA-DR) and Peru-US Free Trade Agreements have been implemented under this system. Fortunately, the expiration of Fast Track provides us with an opportunity to revise our trade negotiating priorities to ensure a fair, democratic process and adequate safeguards for the environment, workers and public health. Click here for more detailed information about Fast Track.


Foreign Investor Rights / U.S. Model Bilateral Investment Treaty

The U.S. has signed bilateral investment treaties (BITs) with dozens of countries, almost all of which we do not already have full-fledged free trade agreements. Bilateral investment treaties aim to protect US investments abroad and to protect foreign investments in the US. However, the rights granted to investors in BITs have serious and far-reaching implications for the environment.

Much of the blame rests on the model text off which most US BITs are based-the model BIT. The model BIT, while providing strong protections for multinational companies, contains only unbinding, weak protections for the environment. In fact, the model BIT allows foreign investors to challenge domestic public interest laws, thus giving foreign investors greater rights than their domestic counterparts. In contrast, foreign investors under the model BIT have zero responsibility to ensure the sustainable development of the communities in which they operate. Under the model BIT, protecting foreign investments comes at the expense of the public interest.

[tk links in this graf -- where exactly?] The model BIT also serves as a template for the investment chapters of free trade agreements. The model BIT contains extremely similar language as the investment chapters of NAFTA, CAFTA, and the U.S.-Peru free trade agreement. So it comes as no surprise that these major trade agreements share many of the same problems as the model BIT.

The Sierra Club and other public interest organizations also submitted comments for the previous review of the model BIT, which took place in 2004. Read the comments here.

More information:
·Text of the 2004 US model BIT
·United States reviews its model bilateral investment treaty


Procurement

Should an international trade agreement determine how we are allowed to spend our domestic tax dollars? The Government Procurement Agreement of the WTO, of which the United States is a signatory, acts as the main vehicle to constrain government procurement policies across the globe.

International trade rules governing procurement can block even the most benign efforts of Congress, federal agencies, and even state governments to act responsibly when making purchasing decisions. Commonsense policies aimed to encourage economic development and environmental protection are prohibited by trade agreement procurement rules designed to keep countries from "discriminating" in their purchasing decisions.

Trade rules governing procurement open up the door to international lawsuits against a government that requests steel made only by workers earning fair wages or paper and wood that must come from sustainably harvested forests. Our responsible purchasing standards are unnecessarily discriminatory in the eyes of a foreign company seeking profits, profits which may come at the expense of American jobs and the global environment.

Several NAFTA-style "free trade" agreements, including the Peru, Panama, and Korea Free Trade Agreements, expand the threat of a trade challenge to socially responsible purchasing laws.

The United States and all other countries should retain the right to purchase products that are made responsibly. The United States should not remain a signatory to any procurement agreements that undermine labor and human rights or environmental protection.




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