The United States appears ready to initiate a formal trade complaint against Mexico following that country's failure to meet its latest self-imposed deadline for easing restrictions on United Parcel Service's small-package delivery business.
Mexico's transport minister said last week it will take his government another month to complete a long-delayed rule-making on the issue.Carlos Ruiz Sacristan said regulations pertaining to the UPS request will be completed "within four weeks" and that licenses for the company will be issued "immediately thereafter."
Mexican officials had promised to complete the regulations by last Friday. That date was seized on by the Clinton administration as the deadline for avoiding a trade complaint under the North American Free Trade Agreement.
In letters to Mr. Ruiz in March, U.S. Trade Representative Mickey Kantor and Transportation Secretary Federico Pena said procedures under the Nafta would be the next step if March 31 passed without action.
UPS has complained since the Nafta took effect that it is unfairly barred
from using anything larger than small delivery vans for its small-package business in Mexico. The company charges that its Mexican competitors are able to use large trucks under licenses for "cargo" business that have been denied UPS.
UPS argues that its small-package business is fundamentally different from this service and that a Mexican commitment to treat all small-package companies the same ought to extend to the use of heavy trucks.
Part of the problem is that Mexico obtained an exemption from the Nafta's free-trade rules for conventional freight-hauling by heavy truck, and has been able to limit U.S. investment in that sector. It is not clear, however, that the "reservation" taken by Mexico was sweeping enough to protect Mexican companies completely in this case, and U.S. officials believe they have a good chance of winning a dispute process.
Under the Nafta, the first step in resolving a trade complaint is to call for "consultations" between the countries, a formality that cannot stand in the way of formation of a dispute panel.