Turning to the question of whether Article III of the Constitution requires that the review process remain in the Federal courts, I would emphasize that Congress is universally regarded as having wide authority over the allocation of Article III power. Indeed, in some prior regimes, tariff issues have remained wholly in the executive with no judicial review and the predecessors of the current Article III courts that exercise the review function were at one time Article I legislative courts. Both schemes were upheld by the Supreme Court. So, in general, the Congress is free to keep judicial review within the Article III judiciary as it finds it now, to put it in Article I legislative courts, or to put it wholly in the executive. What about arbitration? Twice the Supreme Court has upheld the use of arbitration in domestic Federal programs. In both of those, there was some retained Article III review on a very limited basis. The possibility, then, is that it is necessary to bring these duty determinations under the nose of an Article III judge at some point for review. I don't think that's true. In programs having an international flavor, the Supreme Court has repeatedly held that administrative determinations are not subject to judicial review even when statutes seem to provide for it. There is, however, one caveat to this I would like to enter. The Supreme Court has repeatedly shown a reluctance to interpret statutes to forbid all judicial review of constitutional questions about the overall nature and operation of a program. Therefore the constitutionality of this agreement can be maintained by just continuing the silence that is in current versions of it on whether the Supreme Court may exercise constitutional review of the whole scheme. If so, I think the Supreme Court will address that question and will uphold it, but I would not do anything in the implementing legislation that would seem to forbid Supreme Court review of the constitutionality of the scheme. Then finally, Article II. The question is whether Article II requires that if these decisions be made not by Federal judges, they be made by officers of the United States. Here broad language in Buckley v. Valeo raises some concern. It requires that officers of the United States appointed in conformity with the appointments clause exercise all "significant duties pursuant to the public laws." However, the context of Buckley is critical. It involved congressional attempts to strip the executive's appointments power concerning the appointment of ordinary regulators, the members of the Federal Election Commission. No one seriously criticizes this aspect of Buckley today. I think people realize that ordinary regulators need the kind of executive supervision that Article II contemplates in placing appointment power ordinarily within the executive. However, the international context is and always has been fundamentally different on this score. For example, in Dames & Moore versus Regan, a decision after Buckley, the Court upheld the transfer of United States claims into the Iranian-U.S. claims tribunal, an international tribunal that is not staffed by officers of the United States. The Court did not pause to ask whether Buckley versus Valeo forbade this scheme. Similarly, if we look at the history and nature of international arbitral panels of all kinds, we see that they flow from the international powers of the United States and fit comfortably within our scheme. If the current Free Trade Agreement is unconstitutional, that is due to aspects that it has in common with the Jay Treaty in 1794 and many international agreements since. What I'm saying is that if this sort of agreement is unconstitutional now, that fact has escaped the Supreme Court for 200 years, and it escaped the founding generation as well. I would like to add one point that is not covered in my statement with regard to Mr. Gibbons' statement. At one point he suggests that members of the Court of International Trade be appointed to the arbitral roster. With all due respect to Mr. Gibbons, I think that would be a mistake in the implementing legislation. The reason is essentially this: Article III jurisprudence forbids Article III judges to perform functions that are inconsistent with their judicial duties. The law of what is inconsistent with Article III duties is most unclear, but there would be at least some concern, I should think, with whether the barrier there was being transgressed here. There is little case law on it. It is not very helpful. So my advice to you would be to avoid, if you can, building in a constitutional issue when you do not need to. More broadly, the reasons why Free Trade Agreement arbitration is constitutional have to do with the fact that it is not meant to exercise the functions of an Article III court. It is meant to be a body that is international, that is impartial, and it draws its support from the international powers of the United States. To put an Article III judge on the panel blurs those distinctions and I think might conceivably threaten a court's view of the overall scheme, so I would advise against that. Thank you, Mr. Chairman. I will, of course, welcome your questions. [The statement of Harold H. Bruff follows:] Statement Before the Subcommittee on Courts, Civil Liberties and Harold H. Bruff John S. Redditt Professor of Law I am pleased to present my views on the constitutionality of certain provisions of the proposed Canada-United States Free Trade Agreement (FTA). Under existing law, antidumping and countervailing duty determinations are made through the interaction of the International Trade Administration (ITA) of the Department of Commerce and the International Trade Commission (ITC). Judicial review may then be had in a sequence of Article III courts: the Court of International Trade, the Court of Appeals for the Federal Circuit, and the possibility of Supreme Court review. The FTA would create an international arbitral tribunal to perform these review functions. I conclude that these provisions of the FTA are within the constitutional powers of the United States government, pursuant to its authority to enter international agreements. Although displacing other features of the domestic law of the signatory nations, the FTA would temporarily retain in force their bodies of statutory and administrative law that impose duties to offset international price discrimination (dumping) and subsidization of exports (countervailing duties). Under Article 1904, each Party nation is partially to replace judicial review of final administrative determinations with binational panel review. Either Party may request a panel review of any final antidumping or countervailing duty determination of the administrative agencies, and they must do so if a private person otherwise qualified to invoke judicial review so requests. If no request is made, however, ordinary domestic judicial review is available. The panels are constructed in a manner common to international arbitration (Annex 1901.2). The Parties jointly develop a roster composed of their citizens, a majority of whom are to be lawyers. Each Party appoints two members of a panel from the roster, and the fifth is selected by a series of procedures designed to maximize mutual assent. A panel then holds an appellate hearing and applies the legal standard of review that a domestic court would employ. Both the administrative agencies and private persons having standing under domestic law may appear and argue. The panel is empowered to uphold the agency, or to remand its order for action "not inconsistent with the panel's decision" (Art. 1904.8). The FTA makes the panel's decision final, except for an "extraordinary challenge procedure" before another specially constituted panel. There, parties could raise the very limited grounds for review that typify arbitral schemes, for example a member's conflict of interest or a claim that the panel "manifestly exceeded its powers" (Art. 1904.13). A frame of reference for analysis of this scheme is provided by some general principles about the nature and effect of international agreements, the nature of tariff determinations, and the extent of congressional power to assign the judicial power created by Article III to courts, executive officers, and arbitrators. I first review these principles, and then turn to a series of discrete constitutional objections that may be raised against the FTA. The proposed FTA is not a treaty, but rather a species of international agreement called a "Congressional-Executive agreement." Legislation authorized executive negotiations leading to formulation of the FTA; legislation will implement it. If completed, the agreement will modify domestic law, as would a treaty.1 Nevertheless, it seems to be firmly established that no international agreement is "free from the restraints of the Constitution," such as those in the Bill of Rights.2 international compacts can alter our law, but not our system of separated powers or our constitutionally protected liberties. In sum, Tariff controversies are as old as the Republic. Pursuant to its powers to lay duties and to regulate foreign commerce, Congress has granted the executive widely varying degrees of discretion to set particular tariffs. The constitutionality of broad delegations to the executive has long been settled in this area, in part due to the presence of the President's own foreign 1. L. Henkin, Foreign Affairs and the Constitution, Ch. 6 (1972). 2. Reid v. Covert, 354 U.S. 1, 16 (1957) (declining to find authority for courts-martial of military dependents overseas in an executive agreement). |