UPDATE: A Guide to MERCOSUR Legal Research – Sources and Documents

By Edgardo Rotman [1]

Update by Gloria Orrego Hoyos and Mariel Romani

Gloria Orrego Hoyos has a law degree from the Pontificia Universidad Javeriana in Bogotá, Colombia. She has a Masters in Constitutional Law and Human Rights from the Universidad de Palermo in Buenos Aires and a postgraduate degree in Library and Information Management from the Universidad de Ciencias Empresariales y Sociales (UCES) in Buenos Aires, Argentina. She is currently a professor at the Legal Research Methods course in the Law Department of the University of San Andrés and also, in the same course at the Universidad Torcuato DiTella (UTDT). For 10 years she worked at the Max von Buch Library of the University of San Andrés in Buenos Aires as head of the reference services. She currently serves as a legal reference at the General Secretariat of Training and Jurisprudence of the Public Defender's Office.

Mariel Romani is an Argentine librarian in charge of the Serials library at the Max von Buch Library at the Universidad de San Andrés, Buenos Aires, Argentina. She assists faculty in their research and is in charge of legal reference and information literacy at the institution.

Published July/August 2018

(Previously updated by Euyelit Moreno in January/February 2010)

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1. Background

On March 26th, 1991 Argentina, Brazil, Uruguay and Paraguay signed the Treaty of Asunción, establishing “Mercosur,” an acronym for Mercado Comun del Sur (Art. 1) that took effect on December 31, 1994. The purpose of the agreement was to set up a common market and eliminate trade barriers among the signatory parties.

There are many precedents to Mercosur. The first one was the creation of the unsuccessful Latin American Free Trade Association (LAFTA) in 1960. In 1980, the Treaty of Montevideo [2] replaced LAFTA with the Latin American Integration Association (ALADI). This new integration initiative was based on a series of bilateral treaties within a flexible framework of multilateral tariff preferences, with no more success than its predecessor. Argentina and Brazil decided to approach a mutual integration process by means of a series of sectoral protocols, subsequent to the 1986 “Declaration of Buenos Aires,” followed by the 1988 Agreement on Argentine-Brazilian Integration,[3] which was joined by Uruguay and Paraguay.[4]

Currently, Chile, Bolivia, Ecuador, Peru and Colombia are associate members of Mercosur. Chile and Bolivia became associate members in 1996 and Peru in 2003. Mexico started talks over a bilateral agreement on tariffs reduction with Argentina and aims at becoming an associate member of Mercosur. [5] Also, the Brazilian Senate approved last December the entry of Venezuela into the Common Market of the South. In this way, Brazil joined Argentina and Uruguay in endorsing Venezuela’s membership, while approval by Paraguay is still pending. In connection to these initiatives, Mercosur and the Andean Community initiated negotiationson the formation of a preferential trade area in 1995. The establishment of a comprehensive preferential trade area between these two customs unions could potentially be a major stepping-stone for the creation of a South American Free Trade Agreement. The result has been negotiations to achieve this objective through automatic tariff reductions and a maximum tariff reduction schedule of 15 years for the most sensitive products. Brazil’s strategic target is to establish a South American Free Trade Area that could be instrumental in the negotiations with the United States on the Free Trade Areas of the Americas.

In 2003, the Mercosur countries celebrated the 24th presidential summit in Asunción, Paraguay, celebrating its commitment to strengthen the political agenda and expand regional integration creating a genuine single market by 2006.

Article 2 of the Asunción Treaty established reciprocity of rights and obligations between the State Parties to Mercosur. This common market would include the gradual elimination of all customs duties among its signatories, the creation of a common external tariff, the adoption of a common trade policy, and the harmonization of economic policies.

In December 17th, 1994, the Protocol of Ouro Preto set up the institutional structure of Mercosur, which started to function in 1995.

The administration and implementation of Mercosur is entrusted to the Council of the common market and the Common Market Group (Art. 9 of Asunción Treaty). The Common Market Council is composed of the member states’ ministers of foreign relations and ministers of economy (Art. 11). It is the most important and powerful Mercosur institution and is responsible for its political leadership and for decision-making to ensure compliance with the objectives and time frames set for the final establishment of the common market (Art. 10). The Common Market Group is the executive board of Mercosur. Composed of 16 members representing the foreign affairs ministries, the economic ministries, and the central banks of each of the countries, it has established its administrative headquarters in Montevideo, Uruguay. The Common Market Group branches out into the Trade Commission of Mercosur which is responsible for advising and enforcing trade policies, as well as setting directives; the Joint Parliamentary Commission in representation of the four Parliaments; the Economic and Social Consultation Forum which has representatives from the different economic and social groups, and finally the Administrative Secretariat, in Montevideo, which supports the whole operation and is responsible for advising the other offices of Mercosur. In addition, the Olivos Protocol established a Permanent Appellate Tribunal to hear appeals of arbitration awards.[6]

The Brasilia and Olivos Protocols establish Mercosur’s dispute resolution procedures and institutions regarding the interpretation, application, or failure to comply with the Asunción Treaty or any of its Protocols, Council Decisions and Group Resolutions. The Olivos Protocol permits a dispute to be submitted, either by the complainant or by mutual agreement of the parties, to the dispute resolution systems of the World Trade Organization (WTO) or other preferential trade systems that the Mercosur State Parties may have entered into, as long as the parties to the dispute jointly agree on a forum.[7] This dispute resolution mechanism changed Mercosur by making arbitration awards appealable to the Permanent Appellate Tribunal. The Tribunal will decide the controversy based on the dispositions of the Treaty of Asunción, on the decisions of the Common Market Council, the resolutions of the Common Market Group, as well as on the principles and norms of international law, which are applicable to the matter.[8] The Tribunal must render its decision within ninety days.[9] The Mercosur dispute resolution system, even though strengthened by the addition of the Permanent Appellate Tribunal by the Protocol of Olivos, is still wanting because it lacks an effective mechanism to protect the rights of individual entities or persons and is limited to disputes exclusively arising among member states regarding the application of Mercosur norms.[10] Individuals may only file their claims with the National Chapter of the Common Market Group of the State Party where they reside. These claims are considered automatically concluded, with no further formal steps if the matter is not settled within fifteen days from initial notice of the claim.[11]

Mercosur represents the third largest trading bloc in the world after the European Union and NAFTA (the FTAA is not taken into account because it is not fully active and has not been completed).[12] Its initial success brought about a reduction of around 95% of trade barriers among its members. Since the signing of the Asunción Treaty in 1991 inter-regional trade has almost tripled from 5.1 billion US dollars to 14.38 billion in 1995, while trade with the rest of the world increased from 67 to 120 billion US dollars (Merco Press, June 15, 2004). The automobile industry is one of the areas that specially boomed as a consequence of Mercosur. In the area of foreign direct investment, the member countries experienced major developments in the late 1990s, because of the process of privatization in telecommunications and investment in financial services. As of 2000, Mercosur’s GDP was $900.9 billion in US dollars.[13] The Protocol of Montevideo signed on December 15th, 1997 attempts to liberalize the trade in services, setting out a ten-year program especially in the areas of financial services, insurance and professional services, satellite communications, and air transportation. Of all the member countries, Argentina has committed itself to a higher rate of liberalization than the other Mercosur countries.

Although Mercosur was to a certain extent inspired by the European Union model, it is not a supranational organization. Rather, Mercosur is an intergovernmental organization geared towards the creation of a common market, without discarding a future economic and monetary union, and even a common currency. Mercosur stands at an integration stage known as a customs union. A customs union is characterized by a common external tariff among members of the union as well as elimination of barriers of trade between member states.[14] Mercosur has managed to eliminate most of the trade barriers in goods and services and achieved the establishment of a common external tariff, despite the historic rivalry of the members involved.[15] It has been questioned, however, whether Mercosur can accurately be termed a “customs union,” given its difficulties in maintaining its common external tariff because of the current economic problems of the countries involved.[16]

Pitou van Dijck and Marianne Wiesebron, editors of a significant retrospective study on the subject, determined that “by 1999 Mercosur had become the single largest destination of foreign direct investment among newly industrializing countries, larger even than China.”[17] An important reason for its success is the vast reserves of natural resources and energy provided by its members. Currently, economic crisis, currency volatility and economic conflicts among member countries have made investments less attractive and the foreign direct investment flow has become unpredictable. The central theme appears to be in finding equilibrium between macroeconomic stability and policy coordination in order to achieve successful economic integration.

The European Union and Mercosur are expected to confirm negotiations and free trade agreements. Although negotiations were suspended in 2004 because of fundamental differences in the trade chapter, political relations have nevertheless evolved, with an agreement made at the last Summit in Lima in 2008 to extend relations to three new areas, science and technology, infrastructure and renewable energy. Despite the desire to create an economic and trade area with significant political dimensions, there is caution because of fundamental differences with the European Union over certain sensitive issues, such as the agricultural subsidies of the industrialized nations. In addition, Mercosur and China will begin negotiating a free-trade agreement.[18]

Before presenting the sources it is important to point out that research on Mercosur presents certain difficulties for the English-speaking researcher because a considerable amount of sources and information about Mercosur are available in Spanish and Portuguese and have not been translated to English.

2. Basic Documents

2.1 Organization and Structure

2.2. Investment and Competition

2.3. Civil Procedure

2.4. Criminal Procedure

2.5. Illegal Traffic of Minors

2.6. Illegal Traffic of Immigrants

2.7. Transportation

2.8. Trade in Services

2.9. Education

2.10. Consumer Rights

2.11. Insurance

2.12. Labor Law

2.13. Postal Agreements

2.14. Trademarks

2.15. Social Security

2.16. Environment

2.17. Agreements Between Mercosur and Other Regional Organizations and States

3. Selected Materials

3.1. Books by Chronological Order

Most of the books cover a variety of subjects; the only exceptions are Sardegna’s work on labor law and Baigún and da Rocha’s study on economic crimes. On the other hand, there has been a fast development in many areas, turning older literature less useful. On this basis, a chronological index seems to be the most appropriate format.

3.2. Recent Law Review Articles

Mercosur: Organization and Structure (general)

Investment and Competition

Social aspects

Trade in Services

Labor Law

3.3. Journals

3.4. Lexis-Nexis and Westlaw Database

3.5. Internet Sources

[1] 2004 Edgardo Rotman.

[2] 20 I.L.M. 672 (1981).

[3] 27 I.L.M. 901 (1988).

[4] Evelina Teubal de Alhadeff, Introductory Note to the Treaty establishing Mercosur. 30 I.L.M 1041 (1991).

[5] Latin American News Digest (June 8, 2004).

[6] Protocol of Ouro Preto.

[7] Olivos Protocol, Article 1-2.

[8] Brasilia Protocol, Article 19-20, Olivos Protocol, Article 16, 34.

[9] Id.

[10] Rafael A. Porrata-Doria, Jr., Mercosur: The Common Market of the Twenty-First Century? 32:1 Ga. J. Int’l & Comp. L. 20 (2004).

[11] Olivos Protocol, Article 39-42.

[12] Christopher M. Bruner, Hemispheric Integration and the Politics of Regionalism: The Free Trade Area of the Americas (FTAA). 33 U. Miami Inter-Am. L. Rev. 1 (2002).

[13] World Bank, World Development Report 2002: Building Institutions for Markets 236-237 (2001).

[14] General Agreement on Trade and Tariffs (GATT), Article XXIV.

[15] Otero-Lathrop, Miguel, Mercosur and NAFTA: The Need for Convergence. 4 NAFTA: L. & Bus. Rev. Am. 116 (1998). See also Maria Angélica Espinosa, The Andean Community: Reaching Out to Bolivar’s Dream. 7 L. & Bus. Rev. Am. 329.

[16] Mario Esteban Carranza, South American Free Trade Area or Free Trade Area of the Americas? Open Regionalism and the Future of Regional Economic Integration in South America, cited by Christopher M. Bruner, Hemispheric Integration and the Politics of Regionalism: The Free Trade Area of the Americas (FTAA) in 33 U. Miami Inter-Am. L. Rev. 28, at n. 126 (2004).

[17] Pitou van Dijck and Marianne Weisebron, Ten Years of Mercosur 10 (Amsterdam: Centre for Latin American Research and Documentation 2002).

[18] Brazil: Lula’s China Commitments in Economist Intelligence Unit – Business Latin America, available in 2004 WL 63625789 (June 7, 2004).

[19] Mercosur-European Community Strategy Paper

[20] In order to search for regulations, access from here: http://www.mercosur.int/innovaportal/v/387/11/innova.front/busqueda-de-normativa.