U.S.-Korea Free Trade Agreement: Potential Economy-wide ... - USITC

environmental laws. 102 In the U.S.-Korea FTA, all FTA environmental obligations would be
enforced on the same basis as the commercial provisions of the agreements and would be
subject to the same remedies, procedures, and sanctions. 103
FTA Chapter 21—Transparency
Chapter 21 of the U.S.-Korea FTA is similar to the transparency chapters in recent FTAs.
As in recent agreements, the U.S.-Korea FTA would require each party to make publicly
available all laws, regulations, and procedures regarding any matter covered by the
agreement. Further, under the chapter, each party must establish or maintain procedures to
provide review and appeal capabilities to any entities that would be affected by actions,
rulings, measures, or procedures under the FTA. The agreement would also require the
adoption of transparency principles within specific industries, including financial and
telecommunication services. Applicable provisions also cover protection for U.S.
trademarks, procedures for government procurement contracts, and the administration and
enforcement of environmental laws. The U.S.-Korea FTA contains a prior notice and
comment period for all new laws and regulations. This chapter also includes anticorruption
provisions relating to trade and investment that would require each party to make corruption
a criminal offense and to establish penalty procedures for bribery and corruption.
FTA Chapter 22—Institutional Provisions and Dispute
Settlement
The first section of the chapter deals with the administration of the FTA. It would require
each party to designate one or more contact points to facilitate bilateral communication on
matters under the FTA. Such contact points would, on request, identify other offices or
officials responsible for the pertinent matter and assist in linking an official with a question
to the person who might answer it. Article 22.2 would set up the Joint Committee comprising
officials of each party and cochaired by the USTR and the Minister for Trade of Korea or
their designees. This committee would have a wide range of functions in supervising the
implementation and operation of the agreement, and play a part in dispute resolution for
covered matters. It could delegate responsibilities to ad hoc bodies, seek input from outside
experts, consider possible FTA amendments, interpret FTA provisions, and handle its own
procedures. It would meet at least once per year in as transparent a manner as possible,
seeking views of the public and taking into account the need for protection of confidential
information.
Under the provisions in this chapter, although the parties commit to consult and cooperate
on FTA matters, one party could invoke dispute settlement on a subject matter not excluded
by any FTA provision if it believes that the other has an FTA-inconsistent measure or has
failed to carry out an FTA obligation, or that a benefit it reasonably expected has not been
given. Where a dispute arises, the complaining party could choose the forum for settling the
matter. If a party requests consultations and the consultation fails to resolve the matter by a
102 USTR, “Bipartisan Trade Deal,” May 2007, 2.
103 For additional information on such remedies, procedures, and sanctions, see the section on Dispute
Settlement in this chapter of the report.
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