San José, Costa Rica, since 1956

CAFTA Sideshow Erupts in Assembly

You might think removing the most controversial decision on the Legislative Assembly’s agenda would allow for an improvement in parliamentary efficiency and harmony.

Think again. If enough Costa Ricans turn out to vote in a nationwide referendum tentatively scheduled for Sept. 23, the Legislative Assembly will no longer have to decide the fate of the Central American Free-Trade Agreement with the United States (CAFTA).

However, disagreements flared this week over how lawmakers should handle the implementation legislation for the polemic pact – a series of legal reforms the country must implement before the trade agreement can take effect.

The set of 13 bills is arguably just as hotly contested as the trade agreement itself.

CAFTA’s implementation agenda contains bills to open the telecommunications and insurance sectors, as well as legislation to modify the country’s intellectual property rights laws. Opponents of the agreement say these changes could produce a laundry list of unwanted consequences, from undermining Costa Rica’s sovereignty to destroying state-owned institutions created to guarantee citizens access to services including electricity, public phones and affordable medicines.

This week, the most pressing question became whether the assembly should move forward on these bills now that the Supreme Elections Tribunal (TSE) has placed the decision-making power on whether to ratify the trade pact in the hands of the country’s voters. Those who support the agreement say lawmakers should move full speed ahead on the implementation agenda so that Costa Rica will be prepared should voters ratify CAFTA; those who oppose the pact want to freeze the bills until the results of the referendum on CAFTA are known.

What’s on the Table?

The implementation bills are in various stages of legislative trámite. The agenda includes two laws to reform the insurance sector; two laws to reform the telecommunications sector; a reform to laws regulating foreign businesses; six different reforms to intellectual property rights laws, which simplify the process of obtaining protections and registering brands; an environmental cooperation agreement between the CAFTA countries; and Criminal Code reforms to punish company executives, as well as public employees, for bribery and corruption (TT, Jan. 26).

Three of these bills are already on the assembly floor: the Reform to the Law on Foreign Businesses, the Treaty on Brand-Name Rights, and the Budapest Treaty, which would facilitate the process of obtaining a patent for microorganisms, allowing foreign businesses to register a patent here without providing a sample of the organism in this country.

Two additional intellectual-property bills are under consideration in one of the assembly’s three comisiones plenas, each made up of one-third of the legislature’s members and with the power to approve most bills.

The rest of the implementation agenda is still in commission, including what is perhaps the most controversial aspect: the bills regarding state monopolies. As anyone who’s watched an anti-CAFTA march knows, participants usually include a sea of workers from the Costa Rican Electricity Institute (ICE) and National Insurance Institute (INS), both of which would gradually lose their monopolies under CAFTA.

One of the twin bills regarding ICE, which holds a monopoly on the country’s $1.5 billion telecom sector, would lift that monopoly by 2011; the other, the Law to Modernize ICE, would prepare the institute to compete in that open market. A special commission formed last year to consider these bills has until May 16 to vote on whether to send them to the assembly floor. Similarly, in the insurance sector, one bill lifts the state monopoly of the National Insurance Institute (INS), while the other modernizes the sector; both bills are backed up in the Economic Affairs Commission.

ICE unions, which oppose CAFTA, argue that with foreign competition taking over part of the lucrative telecommunications market, the institute would no longer have the revenue for unprofitable services it provides, such as telecom infrastructure in remote towns.

CAFTA advocates maintain that ICE will survive, and that opening the telecom monopoly will benefit consumers with or without CAFTA. President Oscar Arias has long criticized the ICE monopoly: In 2003, before his second run for office, he told reporters that “if most think ICE is good, they need to be educated because they are wrong” (TT, Oct. 17, 2003).

Another controversial bill is the revised version of an agreement on intellectual property rights for those who develop new plant varieties. National Liberation Party (PLN) legislator Salvador Quirós said the Agriculture, Fishing and Natural Resources Commission is getting ready to debate a revised version of a bill intended to promote research and development of seed technology as part of CAFTA reforms.

The proposal would protect the developer of a new seed variety’s exclusive right to sell that variety for up to 25 years.

Quirós, the commission’s president, said the new version, recently submitted to the assembly by the Executive Branch, softens punishments for those who violate protections – reducing punishments from jail time to fines. He said six of the commission’s nine legislators are in favor of the law, which could be voted on as early as next week.

Opponents of the project say it could threaten Costa Rican small farmers as well as the country’s food security (TT,March 30).

Political Standoff?

According to PAC, none of these issues should take up time on the assembly floor until the referendum on CAFTA takes place.

“Our position is that CAFTA should be understood as a set of 14 laws together – one is the treaty, but that treaty, without the implementation laws, is nothing,” said Rafael Elías Madrigal, interim faction head of the opposition Citizen Action Party (PAC), who is filling in for faction head Elizabeth Fonseca this month as she recovers from a scheduled operation.

Madrigal told The Tico Times this week that voting on implementation bills before a CAFTA referendum is held “would be like teasing (voters)” and called for a multiparty agreement to postpone a decision on the bills.

So far, the leading National Liberation Party (PLN), which brought pro-CAFTA Arias to power, doesn’t appear ready for such an agreement, and is planning to apply a fast-track mechanism to limit discussion on the implementation bills. However, the President’s brother and spokesman, Rodrigo Arias, said Wednesday that compromise is possible.

The bills “should move forward on the assembly floor,” he said, but added that perhaps Liberation and PAC could reach a compromise wherein legislators will continue to process the 13 bills, but will suspend the vote if any get that far along in the process before the referendum.

Asked whether PAC might accept such a solution, Madrigal said they’re willing to negotiate.

But if the ruling party doesn’t give ground, PAC lawmakers plan to take any and all actions permitted by assembly regulations to slow the process, he added.

Tico Times reporter Blake Schmidt contributed to this report.


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