The Catalyst

Past free trade agreements provide valuable lessons for future success

Posted by Jay Taylor on March 8, 2016 at 9:00 AM

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Catalyst_Promo4.pngLast week, the Senate Committee on Finance held a hearing to discuss free trade agreement implementation and lessons learned from past agreements. The hearing focused on recent examples where compliance of existing U.S. trade agreements have failed – an occurrence not limited to one trade pact or to one industry. As recent trade negotiations have dominated policy and media conversations, including the Trans-Pacific Partnership and Transatlantic Trade and Investment Partnership, we often lose sight of the implementation phase that follows. Taking a step back and examining past free trade agreements, there are numerous best practices that can be garnered.

Steven Tepp, former aide to Sen. Orrin Hatch and chief counsel for the U.S. Chamber of Commerce Global Intellectual Property Center and now president and CEO of Sentinel Worldwide, served as a witness at the Committee’s hearing. As a participant in several bilateral trade agreement talks and an expert in intellectual property protections, Tepp is well versed on the opportunity and power free trade agreements bring.

During his testimony, Tepp echoed the vital need for strong international standards protecting one of America’s strongest assets, intellectual property. The United States remains the envied leader in innovation ranging from electronics to biopharmaceuticals. During trade agreement negotiations, the United States is able to retain our powerful position, but once an agreement is implemented, it remains up to our trading partners to uphold the terms. Unfortunately, transitional periods are diminishing our power to enforce these terms.

One example in which implementation has been challenging is the North American Free Trade Agreement (NAFTA), which was signed by the United States, Mexico and Canada in 1992 and initiated in 1994. NAFTA created strong intellectual property provisions, the highest level of protection and enforcement at the time; however, the Canadian Patent Utility Doctrine compromises these agreed upon protections and imposes arbitrary standards on the “utility” of medicine or other invention, allowing for the revocation of existing patents in question. The Promise Utility Doctrine is responsible for revoking 20 pharmaceutical patents since 2005 and, in turn, questioning the enforcement of NAFTA.

President Obama’s 2016 trade agenda will be the centerpiece of a hearing later this month, as well as a prime opportunity to bring up the lack of past trade agreement implementation. Before addressing interest by countries to join free trade agreements in progress, we must ensure that existing ones are enforced and implemented as agreed.

As Sen. Hatch voiced, a “full and faithful” implementation by all parties involved is key for implementing negotiations and agreements, and for all U.S. citizens to reap the benefits they provide.

Topics: IP, Congress, trade

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