Forum Shopping and Fairness in Mexico–United States Trade Disputes

Abstract

Of all the countries in Latin America, Mexico has the strongest economic ties to the United States, formalized by the creation of the North American Free Trade Agreement in 1994, but this Agreement does not preclude Mexico from targeting the United States in the World Trade Organization's Dispute Settlement Mechanism. In fact, the Agreement's dispute‐settlement system encourages it to do so if the complaint at hand is to have a fair consideration. The North American Free Trade Agreement's dispute‐resolution system goes to a board containing representatives from the three‐member countries, which includes by default the complainant state and the defendant state. Therefore, even though Mexico has the closest economic relationship with the United States of the Latin American states considered in this project, it is also the most likely to target the United States in the World Trade Organization. This article focuses on how trade ties constrain Mexico's use of the Dispute Settlement Mechanism against its largest trade partner.