UNDERSTANDING BETWEEN THE PARTIES TO THE NORTH AMERICAN FREE TRADE AGREEMENT
CONCERNING CHAPTER EIGHT- EMERGENCY ACTION
Article 1: Objectives
The objectives of this Understanding are to establish additional
procedures to facilitate the effective use of Chapter Eight of
the North American Free Trade Agreement (NAFTA).
Article 2: Working Group on Emergency Action
1. The Parties hereby establish a Working Group on Emergency
Action comprising one representative of each Party to the NAFTA.
The Working Group shall be deemed to be a working group established
under Article 2001(2)(d) of the NAFTA.
2. The Working Group shall report to the Free Trade Commission
established under the NAFTA, and shall be subject to the supervision
of the Commission.
3. The NAFTA Secretariat shall provide technical support to
the Working Group.
4. The Working Group shall meet at least annually, unless
the Parties otherwise agree, and on request of any Party.
5. The Working Group may call on the assistance of such experts
and advisers as it deems appropriate.
6. All decisions of the Working Group shall be taken by consensus,
except as otherwise agreed or provided for in this Understanding.
Article 3: Functions of the Working Group
1. The Working Group shall consider any issue related to recourse
to Chapter Eight of the NAFTA and may make recommendations to
2. The Working Group shall consider any recourse to Article
XIX of the General Agreement on Tariffs and Trade by any Party
to the NAFTA, and, at the request of any Party, may serve as a
forum for consultations before or during any such use of Article
3. The Parties may consult in the Working Group on the request
of a Party where a Party considers that:
(a) in accordance with Article 801 or 802, goods originating
in the territory of another Party are being imported in such increased
quantities as to constitute a substantial cause of, or contribute
importantly to, serious injury, or threat thereof, to its domestic
industry, as evidenced by the factors set out in Annex 803.3(9)
of the NAFTA, including trade, productivity, and employment; or
(b) another Party is contemplating having recourse to Chapter
Any consultations under this paragraph shall be without prejudice
as to whether any subsequent emergency action proceeding is consistent
with the NAFTA.
4. The Parties may agree that consultations under paragraph
C shall constitute consultations under Article 801(2) or 802(5)
of the NAFTA.
5. Subject to the rights and obligations of the Parties under
the NAFTA, the Working Group shall serve as a forum for examining,
at the request of any Party and with the agreement of two thirds
of the Parties, trade, productivity, employment and other economic
factors with respect to any good, provided that such discussions
shall not serve as a justification for restricting or prohibiting
trade in any manner inconsistent with Chapter Eight.
6. The Working Group may make recommendations to the Commission
for any improvements to Chapter Eight of the NAFTA that the Working
Group deems appropriate, consistent with the objectives of the
NAFTA and of this Understanding.
Article 4: Definitions
Unless otherwise specified, all terms of this Understanding shall
have the meaning assigned to them in the NAFTA.