U.S. – EU Free Trade Agreement, Sovereign Debt and New Global Landscape — New DNA in Trade Relations?

Here are three items concerning the EU (and the U.S.), the multilateral trading system, and Argentina (sovereign debt restructuring) indicating how global trade issues are changing every day and how important they are to be understood by policy makers in a legal, business and political perspective.
….The WTO Director-General discusses the new DNA of the global trading system as encompassing a changing landscape of geo-political shifts and technological advances. This new world includes the emergence of a range of new state actors who are not “policy takers” but makers in a multi-polar world. He also discusses global value chains (“Made in the World“) involving trade in intermediate goods and the rise of regulations as a non-tariff barrier. This calls for new ways of measuring trade. Lamy, “Future of the International Trading System.” WTO News (November 26, 2012).
….The EU and the U.S. are in very early stages of perhaps discussing a bilateral free trade arrangement, in light of the failure of DOHA. This primarily involves non-tariff barriers (NTBs) involving the impact of regulatory actions on actual trade flows.”Trade Deal Between U.S. and Europe.” New York Times (11.26.12).
…. A U.S. federal court has held against Argentina in its sovereign debt restructuring since it did not have a “Collection Action Clause” (CAC) in its sovereign debt. This is really a simple matter of contract law and a choice-of-law clause.  The court interpreted the “pari passu clause” (“on equal footing“)
to protect non-consenting bondholders — new debt cannot be senior to existing debt. “Markets: An Unforgiven Debt.” Financial Times (Nov. 28, 2012). “Sovereign Debt. Financial Times (11.26.12). “Courts and Argentine Brinksmanship.” New York Times (Nov. 28, 2012).

About Stuart Malawer

Distinguished Service Professor of Law & International Trade at George Mason University (Schar School of Public Policy).
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