The sixth round of talks regarding the renegotiation of the North American Free Trade Agreement (NAFTA) were held in Montreal, Canada, from January 23-28, 2018. During that session, the Parties reportedly concluded a chapter on anti-corruption and made significant progress in other areas such as digital trade, sanitary and phytosanitary measures, technical regulations, telecommunications, and certain subsectors (i.e., pharmaceuticals, chemicals, and cosmetics) for which an industry-specific annex is being pursued. The chapter on anti-corruption is the third one to be concluded, adding to the previously closed chapters on competition and small and medium enterprises. Even against this backdrop of apparent success on certain chapter-specific topics, United States Trade Representative (USTR) Robert E. Lighthizer warned about the negotiations “progressing very slowly” and urged all parties “to move much faster.”
The seventh round of negotiations is currently under way in Mexico City, with talks taking place from February 26 to March 6, 2018. Several core issues are scheduled for this round, including agriculture, labor standards, the outstanding sectorial annexes, cross-border trade in services, financial services, energy, digital trade, customs and trade facilitation, and dispute settlement, among others. Continued negotiations on one of the most contentious issues of the entire negotiations, rules of origin, reportedly were postponed as USTR chief rules-of-origin negotiator, Jason Bernstein, left Mexico City after the first day to participate in last minute meetings with U.S. auto representatives in Washington, D.C. An intersessional meeting between the seventh and the eighth round of talks could potentially be convened in Washington, D.C. to discuss rules of origin.
In the seventh round of talks, NAFTA parties are likely to discuss a recent proposal by Canada on eliminating the existing investor-state dispute settlement (ISDS) chapter. The United States reportedly agrees with this approach while Mexico does not. Canada has reportedly raised an informal proposal to establish a special NAFTA annex establishing a Canada-Mexico ISDS mechanism that would exclude the United States. Furthermore, Mexican chief negotiator Kenneth Smith Ramos, tweeted on the first day of talks, that Mexico will advance “constructive proposals” on “dispute settlement, investment, and sunset among others.”
In sum, the NAFTA renegotiation talks appear to be reaching a critical momentum while parties have started to discuss issues that had been strategically sidelined in previous rounds. Further updates on the NAFTA renegotiations will be included in future editions.
