NAFTA at 20: Unfinished Business

By Jasper MacSlarrow

In many ways, 1994 is similar to today. A young president sits in the White House. Congress is at odds. Technological breakthroughs are happening every day. Innovators are pushing the boundaries of human imagination and creativity. And the United States, Canada, and Mexico are looking to trade agreements to spur innovation and create jobs.

However, twenty years ago, nobody had seen anything the likes of the North American Free Trade Agreement (NAFTA), one of the first agreements to tie three very different and powerful nations by a single goal: dissolve economic borders.

The 20th anniversary of NAFTA has put trade within the North American region back in the spotlight, highlighting the importance of free trade and ensuring the right, comprehensive rules in these agreements. Yesterday before the House Foreign Affairs Committee, Subcommittee on the Western Hemisphere, Mark Elliot, executive vice president of the U.S. Chamber’s Global Intellectual Property Center (GIPC) provided testimony on key intellectual property (IP) matters related to NAFTA and the North American region:

“At the time of signing, NAFTA included IP language that was of high standard. However, this was signed 20 years ago and this level of IP protection now represents a very low bar by 2014 standards. Even with this low bar, we continue to see IP challenges in both Mexico and Canada.

Particularly, GIPC underscored industry concerns with Canada’s current IP system, which is further evidenced by Canada’s low score in the 2012 GIPC International IP Index, Measuring Momentum. From inappropriate patent utility requirements for pharmaceutical innovations to weak copyright laws, Canada is underperforming at a level that is out of line with global best practices.

Graph Poster_smEven enforcement at the U.S. – Canadian border is problematic because Canada has not granted its border officials ex officio authority to seize suspected counterfeit goods. As former Canadian Ambassador to the U.S. Derek Burney has noted, it is more difficult to transport a used mattress across the border than it is to import a trunk-load of counterfeit software, DVDs, or running shoes. Why? As Ambassador Burney points out, the mattress is deemed a health and safety risk under Canadian law unless it is certified to have been properly cleaned and fumigated.

Since the ratification of NAFTA, our economic ties with Canada have grown, making issues such as IP protection and enforcement that much more important. Notes Elliot: “Canada is the largest trading partner for the United States… [making] it all the more bewildering to the business community at how substandard Canada’s IP system is.

So now the United States finds itself twenty years later amidst another pending trade agreement with Canada, and ten other key trading partners.

The experience with NAFTA, and with trading partners Canada, and Mexico, has made it all the more necessary to ensure that trade agreements- particularly the 12-country behemoth known as the Trans-Pacific Partnership (TPP) Agreement- include meaningful and robust intellectual property provisions. The goal of the TPP is not mediocrity. We cannot strive for anything less than setting the bar high: for high standards and high achievement.

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