[Weekly Compilation of Presidential Documents Volume 34, Number 21 (Monday, May 25, 1998)]
[Pages 923-925]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Transatlantic Partnership on Political Cooperation

May 18, 1998

    1. Under the New Transatlantic Agenda, launched in December 1995, 
the United States and the European Union made a commitment to further 
strengthen and adapt our partnership to face new challenges at home and 
abroad. We recognized that our political and economic cooperation is a 
powerful force for peace, democracy and prosperity. We agreed to move to 
common action to achieve these ends. We agreed to move to common action 
to achieve those ends. We have since taken specific steps to strengthen 
respect for human rights, to promote non-proliferation, to fight 
terrorism, to address crises in troubled regions and much more. Our 
experience has shown that, working together, the United States and the 
European Union are more effective in pursuing shared goals. When 
differences have emerged between us, however, this has reduced the 
effectiveness of our response.
    2. In order to enhance our partnership, we undertake to intensify 
our consultations with a view to more effective cooperation in 
responding to behavior that is inimical to the goals agreed in the New 
Transatlantic Agenda or which threatens international stability and 
security, in which we have a shared interest. We have instructed senior 
officials to undertake early consultations when there is an evident risk 
of such behavior. To this end, we have agreed to principles that will 
guide us:
    (a) We will seek through exchanging information and analysis and 
through early consultations to pre-empt, prevent and, as needed, respond 
to such behavior. Our objective is to achieve compatible and mutually 
reinforcing policy responses, which are practical, timely and effective.
    (b) These responses should be carefully formulated as part of a 
coherent overall policy approach designed to change unacceptable 
behavior. They should also be in line with international commitments and 
responsibilities.
    (c) We will make full use of diplomatic and political action to 
achieve our objectives.
    (d) Economic sanctions are another possible response. Their use 
requires careful consideration. In general, they would be used only when 
diplomatic and political options have failed or when a problem is so 
serious as to require more far-reaching action.
    (e) In such circumstances, the United States and the European Union 
will make a maximum effort to ensure that they economic sanctions are 
multilateral. They are likely to have the strongest political and 
economic impact when applied as widely as possible throughout the 
international community. Multilateral actions also distribute the costs 
of sanctions on the imposing parties more evenly. Whenever possible, 
effective measures taken by the UN Security Council are the optimal 
approach.
    (f) When multilateral economic sanctions are imposed, our objective 
will be to exert

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the greatest possible pressure on those responsible for the problem, 
while avoiding unnecessary hardship and minimizing the impact on other 
countries.
    (g) Where wider agreement on economic sanctions cannot be achieved, 
or in cases of great urgency, the United States and the European Union 
will consult on appropriate responses. In such circumstances either 
partner could decide to impose economic sanctions.
    (h) To ensure the resilience of our partnership in such 
circumstances:
    --a partner will not seek or propose, and will resist, the passage 
      of new economic sanctions legislation based on foreign policy 
      grounds which is designed to make economic operators of the other 
      behave in manner similar to that required of its own economic 
      operators;
    --that partner will target such sanctions directly and specifically 
      against those responsible for the problem; and
    --the partner not imposing sanctions will take into account the 
      interest of the other in formulating its own policy and continue 
      to pursue, in its own way, those goals which are shared.
    (i) It is in the interest of both partners that policies of 
governmental bodies at other levels should be consonant with these 
principles and avoid sending conflicting messages to countries engaged 
in unacceptable behavior. Both partners will work to achieve this goal.
    3. The United States and the European Union will consult closely, 
including at senior levels, in applying these principles and resolving 
differences. Each side will also develop the necessary internal 
procedures to ensure effective implementation of the principles.

Understanding on Conflicting Requirements

    The United States and the European Union, recalling the 
Understanding of April 11, 1997, which stated, inter alia, that they 
would ``work together to address and resolve through agreed principles, 
the issue of conflicting jurisdictions, including issues affecting 
investors of another party because of their investments in third 
countries,'' wish to confirm in this Understanding their intention to 
propose jointly in negotiation of the Multilateral Agreement on 
Investment the following article regarding conflicting requirements:
    ``1. In contemplating new legislation, action under existing 
legislation or other exercise of jurisdiction which may conflict with 
the legal requirements or established policies of another Contracting 
Party and lead to conflicting requirements being imposed on investors or 
their investments, the Contracting Parties concerned should:
(a)         have regard to relevant principles of international law;
(b)         endeavor to avoid or minimize such conflicts and the 
            problems to which they give rise by following an approach of 
            moderation and restraint, respecting and accommodating the 
            interests of other Contracting Parties;
(c)         take fully into account the sovereignty and legitimate 
            economic, law enforcement and other interests of other 
            Contracting Parties;
(d)         bear in mind the importance of permitting the observance of 
            contractual obligations and the possible adverse impact of 
            measures having a retroactive effect.
    2. Contracting Parties should endeavor to promote co-operation as an 
alternative to unilateral action to avoid or minimize conflicting 
requirements and problems arising therefrom.
    3. Contracting Parties should on request consult one another in 
accordance with paragraph____of Article____ (Consultations section of 
Dispute Settlement provision) and endeavor to arrive at mutually 
acceptable solutions to such problems, it being understood that such 
consultations would be facilitated by notification at the earliest stage 
practicable.
    4. If consultations under paragraph 3 do not result in a mutually 
satisfactory resolution of the claim, either of the Contracting Parties 
may bring the matter to the attention of the Parties Group. Pursuant to 
Article____(The Parties Group), the Parties Group will consider the 
matter in light of the agreed principles in paragraph 1, with a view 
toward resolving the matter.

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    5. The Parties Group may review, in accordance with 
Article____(Review), the implementation and assess the effectiveness of 
this Article.''
N.B.: It is understood that nothing in the MAI excludes this provision 
from MAI dispute settlement.

Note: This statement was made available by the Office of the Press 
Secretary on May 18 but was not issued as a White House press release. 
An original was not available for verification of the content of this 
statement.