Foreign investors in agriculture say that American prices could eliminate them – and they can test America in the world court
Foreign business investors in the agriculture sector are planning to bring claims against the US government, as some people think that prices have violated international investment treaties that promise them fair treatment.
International agricultural companies with investments such as distribution networks and subsidiaries in the United States are alteration prices, which has led them to modify their commercial activities, renegotiate contracts with distributors and even threaten the market prices, say experts Fortune. In response to these pricing products, foreign investors plan to bring claims against the United States under international investment treaties, which include a myriad of stipulations such as fair and fair treatment and protect against private investors from benefiting from their American investments.
Produce imports on largely cultivated goods outside the United States, including bananas, blueberries and lawyers, totaled more than $ 33 billion last year. Many major international -based agriculture companies establish American subsidiaries instead of selling wholesalers directly, investing in machines, workers and a distribution network to sell their product. But the prices have tightened margins for these products, which made us parts of these AG companies difficult to maintain, Tiffany Compar, founding partner and co -president of international disputes in Pierson Ferdinand LLP, said Fortune.
“Fresh products have not had any fare since the 90s,” said compared, adding that investments in an American distribution network for fresh products sellers have been made while the prices would remain at zero. “Right now, you are imposing prices, and it is already a low margin business, so you effectively destroy the capacity of this business to work.”
This is the assertion that some foreign GA companies plan to continue the US government, compaties, which represent certain foreign agricultural investors.
If foreign investors decide to follow, they could start the process by providing a complaint against the United States in an international arbitration court, rather than in a national court, alleging that prices violate the investment processing standards described in international investment treaties. International litigation on the investment treaty is arbitrated within the framework of a third -party institution which employs lawyers specialized in international law and has no particular link with one or the other of the parties. None can be a citizen of one or the other country.
Although the USMCA agreement is currently excluding prices for the goods of the largest business partners in the country in Mexico and Canada, imports from Latin American countries – especially bananas and coffee, on which the United States is based to meet consumer demand – are confronted Fortune.
“Brazil is the largest coffee producer. They are a major source of our coffee imports, and are currently faced with 50% prices,” said Ortega. “This therefore increases the cost of the product, the cost of importing coffee into the United States and having very important impacts on the roasters here, but also on Brazil producers who no longer have price access or without service to the American market.”
Although Brazil has no international investment treaty with the United States, the countries protected by the investment treaty of the Republic of free trade in Central Dominican America (CAFTA-DR) such as Guatemala and Honduras, which collectively exports billions of products to the United States, may have a complaint. Argentina and other countries under bilateral investment treated (BITS) also have protections that can be raped by prices, said compaties.
Compared said that his clients were waiting for the Supreme Court’s decision on the legality of the prices before carrying complaints, and even then, they will have to determine if their case is strong enough to wear a court.
“Investors want to assess their damage,” said composed. “They must determine if it really makes sense to them.”
Compared stressed that on average, there is a five -year window to have the treaties with deadlines claim, and that foreign investors will want to make sure they have their “aligned ducks”. Some treaties do not have a time limit at all.
“I would be shocked if we were not starting to see (the statements) in the next five years,” said Clie.
However, all potential complaints under international investment treaties have a difficult battle.
“The United States has never lost a complaint for investor-state disputes,” said Robert Howse, professor of international law at the Nyu School of Law, Fortune.
Howse added that foreign investors bringing a complaint should meet a very specific criterion and would not be eligible for a complaint if they only sold products to American wholesalers.
“You actually have an investment, a distribution network, a warehouse … These are all things that would matter as investments in the United States,” said Howse. Then, the company should prove that its investments were made largely without value due to prices. But even then, Howse said that the United States could say that prices do not violate fair and equal treatments, because it reflects the country’s sovereignty on business issues – and commercial policy, including tariff policy, is part of the general regulatory environment that investors can change.
“This is a fundamental aspect of President Trump’s agenda, even from the moment he presented himself for the first time,” said Howse.
