NAFTA ANTI-CORRUPTION PROVISIONS
Early this year, representatives of the governments of Canada, the US and Mexico started a new set of negotiations to update the 23 year-old North American Free Trade Agreement (NAFTA). Within this free trade area, goods and services are traded and exchanged in amounts close to 1.14 trillion dollars every year, creating one of the most productive, dynamic and larger free trade zones in the world.
The NAFTA compels members to eliminate barriers and tariffs during trade and investment between them, and to comply with a broader set of rules, such as rules of origin, customs procedures, agriculture and sanitary and phytosanitary measures, government procurement, investment, trade in services, protection of intellectual property rights, and dispute settlement procedures, in order to promote fair and harmonic trade among the members. In this new round of negotiations, the United States is requesting the inclusion of some anti-corruption provisions within the text of the agreement.
The document entitled ‘Objectives for the NAFTA Renegotiation’, presented by the US government, contains a request to include in the text new treaty provisions that will compel members to criminalise government corruption, take steps to discourage corruption and provide adequate penalties and enforcement tools in the event of prosecution of persons suspected of engaging in corrupt activities, in particular by: (i) requiring companies to maintain accurate books and records to detect and trace corrupt payments; (ii) encouraging the establishment codes of conduct to promote high ethical standards among public officials; and (iii) requiring parties to prohibit the deduction of corrupt payments for income tax purposes.
Jan-Mar 2018 Issue
ScottHulse PC