Dispute Settlement Mechanisms in U.S. FTAs with Korea, Panama, Peru and Colombia: Basic Designs, Key Characteristics and Implications

Abstract

Abstract The United States concluded free trade agreements (FTAs) with Korea, Peru, Panama and Colombia in late 2000s. Since the four FTAs were negotiated and concluded largely contemporaneously, key traits and characteristics of the agreements are similarly formulated. In light of this, dispute settlement mechanisms (state-to-state dispute settlement proceedings, investor-state dispute settlement proceedings, and Joint Committees) of the four FTAs also share commonalities. At the same time, new ideas and suggestions are explored in the four FTAs. While issues and disputes under the four FTAs have arguably not been ripe for the constitution of dispute settlement proceedings under the FTAs at the moment, sooner or later they are likely to end up in the dockets of the respective proceedings. The key elements of the four FTAs’ dispute settlement mechanisms are also adopted in other FTAs that the United States have concluded afterwards including most recently the Trans-Pacific Partnership, since these elements are reflective of the general scheme of the United States in their FTAs. What remains to be seen is how the general scheme of dispute settlement proceedings can be applied and implemented in actual settings when the FTAs produce increasing numbers of disputes in the future. In particular, marked disparity in human and financial resources between the United States and the four FTA’s parties may bring about disparate impacts and consequences among contracting parties. Continued attention needs to be paid to the development concerning implementation of the four FTAs, in particular their dispute settlement proceedings.