International trade law is the body of laws and agreements that governs how countries do business with each other. The economic health of many countries depends, at least in part, or the ability to import and export goods. International trade laws set out the parameters for how these trades take place. Most of the time, the laws are designed to ensure fairness to all parties, as well as to create something of a globally uniform and predictable set of rules.
There are three primary types of international trade law. The first is national: any country that makes its own internal rules about how trade will be conducted with other countries, or regulates how much of a certain resource can be exported, has created an international trade law. Second is bilateral. When two countries together agree to conduct their trade in a certain way, or to open trade freely between their borders, they create a bilateral trade agreement or trade law. Finally, countries often engage in multilateral agreement-making, which sets common rules and policies to be followed by a number of different global players.
Multilateral trade agreements are what most people think of when they think of trade law. The World Trade Organization (WTO) and the United Nations (UN) are the two foremost organizations involved in the creation of multilateral agreements. Each group is made up of representatives from around the world who attend meetings, brainstorm ideas, and come up with proposed laws and regulations that can shape the international trade landscape. It is through these meetings that the groundwork for most international trade law is set.
A majority of the world’s most prominent traders are members of both the World Trade Organization and the UN’s Commission on International Trade Law (UNCITRAL). The United States, Canada, most of the European Union, China, and Japan are among the most active participants. Both the WTO and the UNCITRAL make it their mission to facilitate broad discussion between countries. Not all discussions end in agreement, but many do.
When national representatives agree to certain standards or conditions of international trade, they are usually promising that their own national law aligns with the terms of the agreement. Sometimes, these agreements are relatively simple to implement. A promise to open trade with neighboring countries is an example. Agreements to restrict trade with countries known to deal in nuclear weapons, for instance, or promises to set trade rules against the export of certain goods to certain places, can take more time and legal weight to put in motion.
Before an international trade agreement can become trade law, it must be ratified at the national level. This means that each country must make sure that its own national laws reflect the terms and conditions of the agreement. Ratification often requires a lot of legal drafting and amendments, and can take years to finalize.
The process of international trade law can accordingly be quite slow, but it is continuous. There is no certain end point to when trade laws will be completed, in large part because trade customs have a tendency to shift with time. Much of trade law involves international economic law, which requires careful attention to fluctuations in currency and power dynamics between world leaders. As international markets change, new leaders come into power, and the global trade dynamics change, necessitating that international trade law evolve to stay relevant.