Role of the indigenous exceptions in international economic law for effective protection of indigenous peoples’ rights and interests: A case study of Mexico – GE corn dispute under the USMCA

Abstract

This paper examines an ongoing trade dispute initiated by the US in 2023 over Mexico's nationwide prohibition on using GE corn for human consumption, focusing on the volume of the legal arguments related to the indigenous exception clause under Article 32.5 USMCA that allows state parties to deviate from all other treaty obligations, if they deem it necessary to fulfill legal obligations to indigenous peoples. By analyzing this case, the paper aims to illuminate the legal impacts and limitations of indigenous exception clauses in trade agreements. Our research found that, throughout the adversarial panel proceedings, both the Mexican and US sides devoted minimal attention to the indigenous exception, constituting no more than 4% of their legal arguments. As arguments related to SPS compatibility decreased, emphasis on exception clauses increased, primarily focusing on general exceptions despite their recognized difficulty. Mexico did not increase its reliance on the indigenous exception, which, though offering broader discretion, was ostensibly not considered a major defense for justifying the measures under the USMCA. We discuss that while balancing values and interests is crucial to mitigate trade disputes, indigenous exception clauses should not be used for protectionist purpose and hinder indigenous participation in world trade.