The U.S. should settle more trade cases

A defeat of the United States at the World Trade Organization on Wednesday, in which the U.S. was found to have discriminated against Mexican tuna fishermen, is an example of a characteristic failure by American trade authorities to negotiate such disputes – which is what the WTO procedure was designed to encourage – even with one of its two NAFTA partners.

Consequently, the decision is favourable to both Mexico and Canada. It is a less happy result for dolphins. Importers of Mexican tuna have not been allowed to label their products as "dolphin safe." In the eastern tropical Pacific Ocean, dolphins are in the habit of swimming in close proximity to tuna, and when Mexican fishermen use purse seine nets to catch tuna, they often catch dolphins, too. But the WTO found that other tuna-fishing methods used in other areas of the world's oceans may be comparably dangerous for dolphins.

Predictably, some economic libertarians are pleased by the WTO decision, while environmentalists and economic nationalists are outraged.

In itself, the protection of dolphins, and dolphin-safe labelling in particular, are good things, but regulations to that end should be applied consistently to all fishing techniques that harm our fellow mammals.

The WTO rules were constructed so as to require a long preliminary phase in which the disputing nation-states ought to explore possibilities of settlement. But the United States did not see fit to negotiate with Mexico and look for a compromise. As Lawrence Herman, an international trade lawyer at Cassels Brock LLP, says, "Surely this was a case where some tweaking of the rules was warranted, rather than duking it out in court."

Canada, in its non-tropical waters, may not have the same tuna-dolphin problem as Mexico. But this country has often experienced the trade litigiousness of the American trade authorities. Mexico and Canada should act together to persuade their partner in NAFTA to make better use of opportunities for accommodation.