-76 220/ grant of authority from Congress, and pursuant to his foreign affairs power, the FTA's establishment of a binational panel will be seen as a compromise reached in order to help advance our foreign relations with Canada. Discussion The three areas of law discussed above-international commercial arbitration, the powers of Congress to regulate international commerce and to lay duties, and the President's power to conduct foreign affairs-are all related to the issue at hand. The creation of a binational panel to arbitrate AD/CVD disputes between the United States and Canada is a concept which is related to these areas of law. Arbitration in the commercial field has been utilized for centuries, and, as the cited cases show, still plays a vital role in international (Footnote continued from previous page) President acts pursuant to an express or implied authorization from Congress, he exercises not only his powers but also those delegated by Congress. In such a case the executive action 'would be supported by the strongest of presumptions and the widest latitude of judicial interpretation, and the burden of persuasion would rest heavily on any who might attack it.') citing Youngstown Sheet & Tube Co. v. Sawyer, 343 U.S. 579, 637 (1952) (Jackson, J. concurring); Curtiss-Wright, 299 U.S. at 320 ("It is quite apparent that if, in the maintenance of our international relations, embarrassment-perhaps serious embarrassment-is to be avoided and success for our aims achieved, congressional legislation which is to be made effective through negotiation and inquiry within the international field must often accord to the President a degree of discretion and freedom from statutory restriction which would not be admissible were domestic affairs alone involved"). 220/ The FTA is, therefore, a "Congressional-Executive Agreement." See generally Henkin, Foreign Affairs 173-76. Note that such agreements may supercede previously passed domestic law. See Restatement (Second) Foreign -77 commercial transactions. The Supreme Court has noted that federal policy favors the use of arbitration to resolve international commercial disputes. The Court has sanctioned the use of arbitration even when U.S. statutory 221/ The Court has allowed rights and federal policy were at issue. arbitration to go forward in an international context even when it assumed 222/ that it could not go forward in a strictly domestic context. Moreover, the Court did so even though the international arbitrators would be 223/ using U.S. law, and even though it acknowledged that international arbitrators could be non-lawyers. 224/ These statements by the Supreme Court support the use of the FTA's binational panel for arbitration of AD/CUD disputes between the United States and Canada. The fact that the binational panel may consist of non-lawyers and will apply U.S. law to a case posed no problems in the commercial context and so should pose no major problems in the context of U.S.-Canada relations. While the issues involved in AD/CVD cases are of a different nature (i.e., involve the use or non-use of certain powers of the U.S. Government), the framework used to arbitrate U.S.-Canada disputes is neither new nor revolutionary. Indeed, one attribute of sovereignty is that the government may make binding commitments regarding the exercise of its 221/ See, e.q., Mitsubishi, 473 U.S. at 639. 222/ See Scherk, 417 U.S. at 515. 223/ Id. at 516. 225/ -78 sovereign powers. Thus, giving power to the binational panel which now resides in the government (i.e., in the CIT) is within the sovereign power of the federal government. In looking at whether a binational arbitration panel can constitutionally perform the tasks that the FTA will assign to it, the powers of Congress and the President must be kept in mind. As noted, above, Congress has plenary power in both regulating international commerce and in establishing duties on imports. Further, the Supreme Court has often stated that Congress may use those two powers in such a way as it deems proper. If the Congress passes enacting legislation to implement the FTA and to establish the binational panel, then the courts should defer to that 226/ enactment. The courts will also take note that the President negotiated the entire FTA with the interests of the U.S. in mind. Moreover, the FTA in its entirety shows that various interests have been carefully balanced. Thus, courts will be unlikely to prevent one integral element of the FTA-the binational panel-from being implemented, since that could mean the collapse of the FTA. When the President and Congress act together in the fields of foreign affairs, international commerce, and the laying of import duties, their 225/ See, e.g., Perry v. United States, 294 U.S. 330 (1985). 226/ This is especially true because the binational panel uses the familiar form of international arbitration. See also Appendix A to this memorandum. -79 combined powers are subject to limited court review at best. the FTA and the subsequent implementing legislation are a combined effort by Congress and the President to further a trade polciy with Canada which both will have determined are in the national interest. In such a situation, courts will probably be quite deferential to the solution chosen by the other 228/ two governmental branches. V. CONCLUSION Based on the above discussion, I have concluded that the use of the binational panel process established by the FTA does not present any major constitutional problems. 227/ See Baker v. Carr, 369 U.S. 186, 217 (1962) (describing which issues are nonjusticiable political questions). See also Frovola v. Union of Soviet Socialist Republics, 761 F.2d 370, 375 (7th Cir. 1985) ("judicial resolution of cases bearing significantly on sensitive foreign policy matters, like the case before us, might have serious foreign policy implications which courts are ill-equipped to anticipate or handle"); Dames & Moore v. Regan, 453 U.S. 654, 688 (1981) (quoted in the Appendix at A-11, n.28). 228/ Cf. Sherk, 417 U.S. at 515-17. In Sherk, the assumed domestic policy against arbitration gave way to the concerns related to the international commercial sphere. Similarly, while the use of a binational panel to review cases in the domestic sphere (e.g., to review decisions of the Federal Trade Commission) could pose constitutional problems, the use of such a panel will not pose the same problems if it reviews cases which fall within the sphere of A-1 APPENDIX A: EXAMPLES OF BINATIONAL PANELS WHICH RESOLVED History provides examples of numerous types of binational and multinational arbitration panels which have been created over time. One type is a binational commission to establish the boundary between the United States and a third country. Another type of tribunal decides monetary claims between 1/ private parties in two nations or between two governments. Below are examples of both boundary commissions and claims tribunals. The examples cited show that the United States has been using these types of international panels continuously for almost two centuries. They also show that such panels have been given "binding" effect on the governments involved. Boundary Commissions United Kingdom 2/ Jay's Treaty, the first treaty ratified under the 1/ A third type of panel is a panel which is used to regulate boundary waters. See, eg, Boundary Waters Treaty, January 11, 1909, United States-United Kingdom, 36 Stat. 2448, Treaty Series No. 548, reprinted in 12 Bevans, Treaties 319-27. The Boundary Waters Treaty established an International Joint Commission ("IJC") to regulate the flow of water from Lake Superior. The decisions of the IJC were made pursuant to the directions contained in the treaty or at the request of the parties. Decisions of the IJC are put into effect by a joint U.S.-Canada staff. Such decisions are not attributable to the United States under the Takings Clause of the Fifth Amendment. See, e.g., Erosion Victims of Lake Superior Regulation v. United States, Appeal No. 87-1279, Slip op. at 9 (November 10, 1987). 2/ Treaty of Amity, Commerce and Navigation, Between His Britannick Majesty; And the United States of America, by Their President, with the Advice and Consent of Their Senate, November 19, 1794, United States-United Kingdom, 8 Stat. 116, Treaty Series 105 reprinted in 12 C. Bevans, Treaties and Other International Agreements of the United States of America 1776-1949 |