Separate Comments of TEPAC Members on the U.S.-Central American Free Trade Agreement (CAFTA)

A statement by members of the Trade and Environment Policy Advisory Council (TEPAC) expressing concerns that the U.S.-Central American Free Trade Agreement (CAFTA) fails to meet the 'no greater substantive rights' mandate of the Trade Act of 2002 and poses threats to national regulatory powers and environmental protections.

• The authors argue that CAFTA is incomplete because it lacks an appellate review mechanism for investment arbitration and has unresolved details regarding the citizen submission process, specifically the lack of a designated institutional home and secure funding for the secretariat.
• The document asserts that CAFTA violates the Trade Act of 2002's requirement that foreign investors not receive 'greater substantive rights' than domestic U.S. investors. This is attributed to the use of ad hoc panels not bound by U.S. Supreme Court precedent and the inclusion of standards like 'fair and equitable treatment' which do not exist in U.S. law.
• The authors criticize the agreement for lacking a general environmental exception in the investment chapter, arguing that Article 10.11 is insufficient and that the lack of such an exception threatens the ability of governments to enact public interest environmental and health policies.
• The statement claims that the expropriation provisions in CAFTA are flawed because they omit critical U.S. jurisprudence, such as the requirement that a government action must permanently interfere with a property in its entirety to constitute a taking, and use ambiguous terms like 'character of government action'.
• The authors express concern that the 'fair and equitable treatment' standard allows for subjective interpretations by arbitral tribunals and could grant foreign investors monetary damages in cases where a U.S. investor would only be entitled to injunctive relief under the Administrative Procedure Act (APA).
• The document notes a lack of evidence that investment rules are necessary for relations with Central American countries, stating there is no public information suggesting these countries have mistreated U.S. investors or that their judicial systems cannot resolve complaints.

APA

Butler, W., Karpatkin, R. H., Magraw, D., & Zaelke, D. (2004). Separate Comments of TEPAC Members on the U.S.-Central American Free Trade Agreement (CAFTA). Center for International Environmental Law. https://www.ciel.org/Publications/TEPAC_CAFTA_18Mar04.pdf

Chicago

Butler, William, Rhoda H. Karpatkin, Daniel Magraw, and Durwood Zaelke. Separate Comments of TEPAC Members on the U.S.-Central American Free Trade Agreement (CAFTA). Center for International Environmental Law, 2004. https://www.ciel.org/Publications/TEPAC_CAFTA_18Mar04.pdf.

Wikipedia

{{cite press release |last1=Butler |first1=William |last2=Karpatkin |first2=Rhoda H. |last3=Magraw |first3=Daniel |last4=Zaelke |first4=Durwood |title=Separate Comments of TEPAC Members on the U.S.-Central American Free Trade Agreement (CAFTA) |publisher=Center for International Environmental Law |date=18 March 2004 |url=https://www.ciel.org/Publications/TEPAC_CAFTA_18Mar04.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@misc{butler2004separate, author = {Butler, William and Karpatkin, Rhoda H. and Magraw, Daniel and Zaelke, Durwood}, title = {{Separate Comments of TEPAC Members on the U.S.-Central American Free Trade Agreement (CAFTA)}}, publisher = {Center for International Environmental Law}, year = {2004}, month = mar, url = {https://www.ciel.org/Publications/TEPAC_CAFTA_18Mar04.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }