Mediation and Arbitration in Political-Economic Relations Using the Example of the US-Mexico-Canada Agreement (USMCA) 2020–2023

Abstract

Consultation, mediation or arbitration are important elements of the dispute resolution system in the international environment. Both world wars of the 20th century taught societies and governments that a lack of willingness to agree and giving vent to aggression in international relations usually leads to collapse and huge losses for all participants in the conflict. Therefore, it is not surprising that after the Second World War an atmosphere of understanding developed for a series of political and economic agreements and the creation of international organisations. Organisations and agreements of a defence, political, economic, financial, cultural nature, as well as integration groupings, were created. Within the latter, free trade zones and customs unions began to gain popularity. The end of the twentieth century with its gradually increasing globalisation has further intensified the expectations of states. However, the lack of success in the area of transatlantic economic agreement did not prevent the search for free trade agreements on the North American continent. Thus was born the success of the North American Free Trade Agreement (NAFTA) and its new incarnation, the US-Mexico-Canada Agreement (USMCA). All of these agreements and organisations presuppose the need to implement a dispute settlement system, preferably in a non-judicial manner. Member states of these agreements, as well as economic operators acting on their behalf, can thus seek assistance in resolving disputes. The purpose of this study is to examine the dispute settlement mechanism of the USMCA. A working hypothesis can be made that the functioning of the dispute settlement mechanism avoids the escalation of economic conflicts so characteristic of the first half of the 20th century. The analysis of dispute resolution mechanisms will emphasise the identification of informal and amicable methods, such as consultation, mediation or arbitration, as it is these methods that minimise the cost of proceedings. The research carried out uses a document analysis method, a literature review and a comparative method involving case studies.

Keywords: US–Mexico–Canada Agreement (USMCA); North American Free Trade Agreement (NAFTA); mediation; arbitration; dispute settlement