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Legal Analysis in Commercial Diplomacy
Analyzing Applicable Domestic Laws and International Agreements

 

Laura Anderson, Jane Earley, Geza Feketekuty and Irving Williamson

© ITCD, 2004. All rights reserved. Reproduction of this document, in whole or in part, is strictly prohibited without written authorization of the authors. No part of this document may be reproduced, stored, or transmitted in any form (electronic, mechanical, photocopy, etc.) without written consent of the authors.


Table of Contents


CHAPTER I: INTRODUCTION

WHAT IS “COMMERCIAL DIPLOMACY”?
HOW ARE LEGAL INSTRUMENTS RELEVANT TO COMMERCIAL DIPLOMACY?
WHAT DOES THE COMMERCIAL DIPLOMAT NEED TO KNOW ABOUT LEGAL ANALYSIS?
WHAT IS THE PURPOSE OF THIS MANUAL?
WHO CAN USE THIS MANUAL?
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS

CHAPTER II: THE ROLE OF LEGAL ANALYSIS IN COMMERCIAL DIPLOMACY
ANALYZING POTENTIAL SOURCES OF TRADE CONFLICTS
Laws, Regulations or Other Government Actions That Adversely Affect the Commercial Interests of Another Country
Laws, Regulations or Other Government Actions Relating To Non-Economic Objectives That Adversely Affect Trade
Government Failure to Take a Trade- Or Investment-Related Action to Address Private Commercial Activity That Is Adversely Affecting the Social or Other Objectives of Another Country
Trade Or Investment Flows That A Government Views As Adversely Affecting Its Trade, Economic, Social Or Other Policy Objectives
NEGOTIATING NEW TRADE RULES AND AGREEMENTS
Drafting International Legal Language
Drafting Domestic Implementing Legislation
Redrafting Affected Domestic Legislation
Drafting Domestic Trade Laws and Measures
HOW TRADE ISSUES THAT MAY REQUIRE LEGAL ANALYSIS COME TO THE ATTENTION OF COMMERCIAL DIPLOMATS
Complaints by Affected Domestic Industry Representatives or Interest Groups
Representation by Domestic Legislative or Other Political Officials On Behalf Of a Domestic Industry
Domestic Legal Proceedings
Reporting by Diplomatic Representatives
Approaches from Foreign Government Officials
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS

CHAPTER III: INTERNATIONAL TRADE AGREEMENTS
WHY GOVERNMENTS REGULATE TRADE AND THE ROLE OF DOMESTIC LAWS
THE RATIONALE FOR INTERNATIONAL TRADE RULES AND AGREEMENTS
THE SCOPE OF TRADE AGREEMENTS
THE MAJOR TRADE AGREEMENTS
The World Trade Organization
Regional Free Trade Agreements
KEY LEGAL PRINCIPLES EMBEDDED IN MOST TRADE AGREEMENTS
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS
TECHNICAL ANNEX ON DOMESTIC AND INTERNATIONAL LEGAL INSTRUMENTS
Terminology of International Legal Instruments
Major International Legal Instruments

CHAPTER IV: RESOLVING INTERNATIONAL TRADE PROBLEMS AND THE ROLE OF LEGAL ANALYSIS
IDENTIFY THE ISSUE
ANALYZE THE ISSUE FROM THE PERSPECTIVE OF THE HOST COUNTRY’S LEGAL SYSTEM
REVIEW ANY RELEVANT INTERNATIONAL LEGAL OBLIGATIONS
EXAMINE THE RANGE OF OPTIONS AVAILABLE TO ADDRESS THE PROBLEM
Consultations with Relevant Host Country Officials
Bilateral or Multilateral Negotiations
International Dispute Settlement Proceedings
Domestic Trade Remedies Available To Private Sector Petitioners
ASSESS THE LEGAL CONSISTENCY OF A POTENTIAL SOLUTION
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS

CHAPTER V: ANALYZING DOMESTIC LAWS: HOW DOES THE MEASURE CREATING THE TRADE ISSUE RELATE TO THE COUNTRY’S LEGAL PROVISIONS?
IDENTIFYING THE LEGAL DIMENSION OF THE TRADE PROBLEM
Arbitrary Actions by Regulators
Interpretation or Implementation of Domestic Law
Substantive Provisions of Domestic Law
Domestic Judicial Rulings
Sub-National Laws
Failure to Implement Domestic Laws
MAPPING OUT THE DOMESTIC LEGAL PROVISIONS THAT APPLY TO THE POLICY MEASURE
ESTABLISHING THE RELATIONSHIP BETWEEN THE TRADE-DISTORTING DECISION OR MEASURE AND THE OBJECTIVES OF THE UNDERLYING LEGAL PROVISIONS
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS

CHAPTER VI: ANALYZING INTERNATIONAL AGREEMENTS: HOW DOES THE TRADE PROBLEM RELATE TO APPLICABLE PROVISIONS OF INTERNATIONAL AGREEMENTS?
WHERE CAN WE FIND INFORMATION CONCERNING THE PROVISIONS OF INTERNATIONAL AGREEMENTS AND TREATIES?
WHAT IF MORE THAN ONE PROVISION OF AN INTERNATIONAL AGREEMENT APPLIES OR MORE THAN ONE AGREEMENT HAS A BEARING ON THE ISSUE?
WHAT IF INTERNATIONAL AGREEMENTS APPEAR TO CONFLICT?
A FINAL WORD OF CAUTION
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS

CHAPTER VII: INVOKING FORMAL INTERNATIONAL DISPUTE SETTLEMENT PROCEDURES
THE WORLD TRADE ORGANIZATION’S DISPUTE SETTLEMENT PROCEEDINGS
Initiating a WTO Case
Consultations
Panels
Steps in the Panel Process
Significance of Panel Decisions
Aftermath of a DSB Ruling
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS
TECHNICAL APPENDIX ON VENUES FOR RESOLVING DISPUTES
USING A COURT SYSTEM TO RESOLVE COMMERCIAL DISPUTES
National Court Systems
Advantages and Disadvantages of Using a National Court System
National Adjudicative Processes for Specialized Claims – Trade Remedies
International Binding Adjudication
WTO Dispute Settlement
Other International Venues
The NAFTA
The European Court of Justice
The International Court of Justice
Agreements Related Primarily to the Environment

CHAPTER VIII: ALTERNATIVE DISPUTE RESOLUTION MECHANISMS TO SETTLE DISPUTES
ARBITRATION AND MEDIATION PROCEDURES
Arbitration Procedures
How Arbitration Works
MEDIATION AND CONCILIATION
What is Mediation?
How Mediation Works
The Success of Mediation
Who Uses Mediation?
Mandatory Mediation
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS

CHAPTER IX: LEGAL ISSUES RELEVANT TO CRAFTING EFFECIVE RESOLUTIONS OF INTERNATIONAL TRADE PROBLEMS
ISSUES RELATED TO INTERPRETATION
ISSUES OF NEGOTIATING AUTHORITY
ISSUES RELATED TO IMPLEMENTATION
ISSUES RELATED TO DIFFERING LEGAL SYSTEMS
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS

CHAPTER X: BASIC PRINCIPLES OF PRIVATE TRANSACTIONAL COMMERCIAL LAW
PRINCIPLES OF PRIVATE TRANSACTIONAL COMMERCIAL LAW
Freedom of Contract
Good Faith
Pacta Sunt Servanda
Fairness
Conclusion
SUMMARY POINTS FOR COMMERCIAL DIPLOMACY PROFESSIONALS
APPENDIX: INTERNET RESOURCES
TRADE-RELATED INSTITUTIONS AND AGREEMENTS
ARBITRATION AND MEDIATION RESOURCES
OTHER RESOURCES

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