Various methods and attempts employed in the harmonization of international trade law - Coursework Example

? INTRODUCTION International trade is the kind of trade that takes place across nations all over the worldeither bilaterally or multilaterally. In a world getting smaller day by day courtesy of the agents of technology, globalisation becomes indispensable. As the world gets digital and globalisation gains root, the prominence of international trade as an aspect of international relations demands careful attention. It is realized that as trade continues to gain momentum across nations, so do the impediments hampering free trade emerge. Free trade is meant to be a mutual agenda between the countries. Nations across the world strive as much as possible to benefit from the trade. In the same vein, challenges emerge as no nation can derive ultimate benefits. Different nations across the world operate under different systems. Such differences have become so diverse that much attention has now been drawn towards addressing them. It therefore begs the analysis of the factors that limit international trade. It is in that vein that the difference in trade laws comes to light. It is becoming much difficult for nations across the globe to freely trade due to the sharp differences that exist in laws governing trade in different parts of the world. For instance a North American exporter will find it almost difficult to export certain products to the Asian countries courtesy of the legal rigidities that are artificially created for various reasons. Nations limit trade so as to regulate deficits on their budgets. Considering that such a deficit might be disastrous to the affected economy. Moreover the need to control the dumping of products into the economy also necessitates the introduction of regulatory measures. In one respect, such measures are never malicious. Rather they are of great essence in ensuring that the international trade benefits all the parties involved. The need to remove such limiting factors therefore sparks off the debate. The discourse becomes further intricate when dealing with legal the aspects of international trade. There exist several statutes and regulations in the world governing international trade. Such statutes are normally enacted to regulate price fixing, competition and to govern free trade between countries. Trade regulation is a theme of law that encompasses governments’ regulations of international trade, the laws relating to fair competition, ethical considerations in international trade and antitrust law. Antitrust law is a branch of trade regulation law that widely includes consumer protection law, distribution law and franchise law. (Osle, 2008) International trade laws exist in various respects both at private and public law. Private international law is derived from the various countries that relate internationally. It controls treaties, conventions and guides model laws. Private international law is applied in monitoring local and foreign judgements relating to legal disputes (Shaw, 2005).It is therefore a great concern in business dealings. The Hague conference on Private international law was a great milestone toward the development of private international law. It encompasses all aspects relating to private law from jurisdictional considerations to contract law. Public international law on the other hand comprises of all the rules and laws that relate to the demeanour of states and other organizations within them as well as their relationships with both artificial and natural persons (Shaw, 2005). A merchant dealing in international trade is inevitably drawn into this complex nexus of differing intricate laws that require attention. These diverse laws have continued to be an impediment towards the achievement of the benefits that accrue by virtue of a free global trade. This therefore creates the need to address this emerging problem by seeking avenues to harmonize these laws into a single streamlined legal system that enhances free trade. The sooner this is achieved the better. Myriad avenues have been proposed as modalities of combating these legal challenges. Some are practical while some, it must be admitted, can only operate under ideal systems. The paper seeks to look into some of the ways that may bring sanity in the rather murky waters of international trade. Conventions and treaties Conventions and other get-togethers provide forums through which international affairs can be deliberated upon. As nations come together, they articulate their various opinions regarding international trade, addressing the challenges that are evidenced therein. A case in point is the 1980 UN Convention on Contracts for the International Sale of Goods (CISG) (M.Flechtner, 1980). The convention was a great milestone toward the redress of the legal factors that hamper international trade with respect to the Sale of goods. The treaty was an efficient masterpiece that seeks to address the intricate area of Sale of Goods by synchronizing modern substantive law into a unified system that will boost trade. Among the objectives addressed in the treaty includes the harmonisation of the sellers’ and the buyers’ obligations towards, the laws relating to offers and payments. It also provides provisions for any subsequent modifications thereof. Another timely session was the Hague conference on private international law, a convention that was held out of the need to harmonize the laws and rules relating to private international law through the creation of multilateral conventions and treaties .as a result, a number of treaties have been established as a follow up to the Hague conference to address wide array of issues of jurisprudence relating to international trade (Brown, 1996). The General Agreement on Trade and Tariffs (GATT) was another classic agenda in the journey towards trade liberalization. A committee was established that endeavours to look into the national laws and regulations relating to international trade. The committee critically examines such aspects of all the member countries of the GATT. It further comes up with recommendations on how the free trade can be boosted by finding feasible ways through which the impediments outlined can be mitigated. The imperative of treaties and conventions should never be overlooked in the attempt towards the achievement of accordance in global trade. Economic integration Economic integration connotes the systems through which economic units integrate so as to eliminate the barriers to international trade (Swash, 1999). The need to establish economic zones has been necessitated by the existence of various limiting factors to global free trade. This has seen several forms of economically integrated systems emerge across the world. The simplest form of economic integration is the Free Trade Area. This is whereby countries establish an agreement to harmonize their laws relating to the tariffs charged on the importation of goods across the countries. On the other hand, the countries are at liberty to establish their own policies of dealing with non-member countries. The next step in economic integration is the customs union. Here, apart from the elimination of tariffs among the nations, the countries normally adopt a similar policy of dealing with non-member countries. A common market is the next step towards the achievement of a full economic integration. In a common market, apart from the attributes realized in the customs union, the member countries allow for the free movement of labour and capital across the region. It is therefore an elaborate economic region that if utilized well can generate substantial benefits to the member countries. An economic union comes next in the process towards full economic integration. Members in an economic union will normally harmonize their economic operations to the extent of adopting a common monetary system. The European Union is a classic example of an economic union. Across the globe, various attempts have been made to liberalize trade as much as possible. In North America, the North American Free Trade Agreement (NAFTA) is an instrument that was specifically formed to react to the decision of the European Countries to establish the European Union. Their objective, like in any other economically integrated unit, is to liberalize trade by reducing trading barriers (Nigrid, 2001). The import and export trade involves a great deal of legal implications. Nowhere in the world have these policies been similar in implication. The laws relating to merchant shipping differ a cross countries. Further differences are evidenced in tariffs, customs and other methods of import regulation. Competition In both common and legal parlance, competition has always been considered as an effective instrument of enhancing free trade. Competition normally treats the need to improve survive delivery and stimulates businesses all over the world to find ways of gaining competitive advantage in the market. In a world getting smaller and smaller day by day, courtesy of technology and globalisation, any firms hoping to survive must strive to offer the best. As such, with competition flourishing, countries will inexorably relax their laws relating to the trade laws thereby facilitating the international trade. Competition encourages firms to go multinational. As a result they encounter different legal structures in place that encourages the authorities to intervene by moderating the legal structures in question. The concept of protectionism advocated by many developing nations has been seen to further slump such economies despite the fortunes normally expected. Protecting local industries from foreign competition bloats the forward growth of such industries. They supply substandard goods that cannot compete in the international market. Financial support It has been established that one of the reasons why countries employ legal barriers of free trade is to protect the infant industries at home (Haddad, 2003). Such industries normally exist in developing countries and cannot effectively compete with the great multinationals of the West. It is therefore prudent to nurture their growth by all possible means. These industries nevertheless can be made to be completive participants in the global market. In most cases, they are supported through financial hand outs to enhance their investment. Through that, they can gain competitive advantage ion the market and effectively compete in the international market. The governments of such countries will therefore have no reasons to justify the existence of legal barriers to the free trade. The World Trade Organisation and the International Monetary Fund has assisted many economies in developing countries with funds for investment. The objective is normally to make such economies be at par with the rest of the world. In the event, free trade will be encouraged through the removal of all trading barriers legal or otherwise. The World Trade Organization The World Trade Organisation is the only global agency that deals with the rules of trade between nations. Based in Geneva, the agency seeks to encourage free trade across nations by persuading countries to eliminate trade restrictions that hinder trade on the global altar (Graham, 2005). The WTO’s mandate cuts across the whole sphere of international trade. It provides a platform where member countries can present their disputes regarding trade and amicable solutions are sought to eliminate them. The WTO basically derives its mandate from the deliberations of the Uruguay Round negotiations and the General agreements on Trade and Tariffs (WTO, 2011). The WTO has on several occasions mediated on legal disputes relating to international trade. Nations have been called upon to reconsider their rigid stances regarding the adoption of global free trade. The Organisation further makes it a duty to educate the member countries of the effects of such limiting factors on trade and even the benefits that would accrue should free trade be a norm. As a result, much progress has been made. Several nations have been seen to heed the call and have adopted better mercantile policies. This have seen several laws relating to foreign trade such as agency, sale of goods and insurance law harmonized across nations for the interests of such nations. Global Awareness Studies have shown that national across the world are ignorant of the benefits inherent in global free trade (Hills & Tracy, 2001). It must be remembered that intensive global trade has only gained roots over the last few years. Consequently, many participants are still ignorant of the all the workings and the modalities that should be in place. Most countries impose legal barriers to free trade for no reason other than to rake in cash in the form of taxes. Attempts are there fore being made to create awareness among nations to harmonize their differing trade laws. It becomes quite difficult for a multinational company, inured to the legal workings of its home country, to step into a totally different legal environment and conduct operations. This necessitates the dire need to present a similar commercial environment upon which free trade can flourish. Several agencies have been at the forefront in creating awareness across the world through the use of intensive calls and campaigns. Forums have been held where deliberations have revolved around the imperative need to harmonize both private and public laws relating to international trade. It must however be stressed that the creating awareness among nations can only prove fruitful if the countries become cooperative and receptive. For instance, cases have emerged where countries have ignored calls to harmonize particular aspects of their laws of trade. This, in most instances, has forced dire measures to be taken against such countries. Forced Measures International diplomacy has been seen to plummet in several instances. In the same vein, cooperation across thyme world has never been efficient. Several countries have been seen to prove quite uncooperative in the journey towards trade liberalisation by refusing to harmonize their commercial laws in line with global regulations. As such, alternative remedies have been sought. Such countries are normally forced to comply with the international rules of the game or face consequences. Consequences have normally included the calls to persuade nations to shun trading with such countries and even neglecting and ignoring them on international affairs (Baumol & Gomory, 2006). Further, international funds from such agencies as the WTO and other agencies have been withdrawn from them. Such dire measures are normally instituted to bring sanity to the altar of global trade. Several countries, especially in the East, have seen such grave measures meted upon them as consequence of their obduracy to harmonize their trading laws with the global standards. It has been proven that the fastest growing economies in the globe have gained such status courtesy of their open door policy toward free trade (Fross, 2003). A country that strives to remove the unnecessary red tape and legal barriers to trade automatically gains the lead toward economic growth. China for instance, has it greatly harmonized its trade laws to be in tandem with those of many world nations. As a result the country has greatly leaped ahead to achieve the rank of the fastest growing economy in the world. On the total scorecard, it must be emphasized that the essence of a global free trade can only be realized if the legal aspects that govern free trade are harmonized effectively. Both Public and private laws should be in tandem all across the globe. All facets of law, substantive, contract, sale of goods etc., should be a synchronized. REFERENCES Baumol, J. W., & Gomory, R. E. (2006). Global Trade and Conflicting National Interests. London: Lionel Robbins Co. Brown, M. (1996). Global Free Trade. New York: Dexton Books. Fross, P. (2003). Moving Towards A Common Trade Agenda. Auckland: Oxford University Press. Graham, B. (2005). Enhancing free trade:A Global perspective. Toronto: HarperCollins . Haddad, M. (2003). Managing Openness: Trade and Outward-Oriented Growth after the Crisis. New York: Ben Shepherd. Hills, J. E., & Tracy, L. (2001). Managing Trade Barriers. Oriental Free Trade , 3, 26-28. M.Flechtner, H. (1980, April 11). Retrieved April 12, 2011, from http://untreaty.un.org/cod/avl/ha/ccisg/ccisg.html Nigrid, J. (2001). Uruguay Round of Multilateral Trade Negotiations. Punjab: Bernan Associates. Osle, R. D. (2008). the New Global Law. London: Cambridge University Press. Shaw, M. N. (2005). International law. Cambridge University Press. Swash, R. (1999). Legal Barriers to Free Trade. Toronto: House of Anansi Press. WTO. (2011, january 15). World Trade Today. Retrieved April Tuesday, 2011, from World Trade Organisation: http://www.wto.org/english/news Read More