Food Labels, NAFTA, and Harmonization: A Maze of Regulation in North America

Abstract

In 1992, Canada, Mexico and the U.S. entered into the North American Free Trade Agreement (NAFTA) whose goal was to increase trade in North America by uniting the three nations in a free trade zone. Through the reduction of tariffs, trade among the three countries has significantly increased in the last 17 years. However, a truly free market eludes the continent. Incongruent regulations have created technical barriers to trade for businesses trying to operate across borders. The regulation of food labels is a good example of this problem. America, Canada, and Mexico have three different and incompatible systems for regulating food, and any cross-border vendor must treble their allotted time, effort, and cost to ensure compliance. Any attempts to change this situation, however, will require more than a mere summit of the regulators from each country. While each country has a tripartite government creating statutes that are then administered by administrative agencies, the influences on policy making and procedures for changing regulation in each country actually vary widely. Though the countries may all benefit from harmonization of regulations, the countries will have to overcome cultural, historical and political obstacles to create beneficial economic policies. The challenges are many, but not overwhelming. For one, harmonization of regulation is but one step in a process. There is no reason for the three countries to feel their differences are insurmountable. Only 50 years ago, Europe faced much deeper and older intra-continental hang- ups, but now Europe is as close to a continental free market as the world has known. If Europe can overcome their problems, so can North America. Both creative and practical solutions may be needed, but harmonization is possible.