Mexico’s bold plan to transform its food system toward healthier, more sustainably produced foods that support rural livelihoods and respect the country’s cultural heritage is an essential example of food sovereignty. Former President Andrés Manuel Lopez Obrador’s decree to restrict the use of GM corn for human consumption, phase out the use of glyphosate and eventually reduce imports of GM corn for animal feed and industrial uses was a direct response to years of advocacy and campaigns by Mexican farmers and other social movements.
That expression of sovereignty ran headlong into the rules in the U.S.-Mexico-Canada Agreement (USMCA) that treat the food we eat as mere commodities to buy and sell. The dispute panel’s ruling against Mexico in a challenge brought by the U.S., and Mexico’s eventual agreement to withdraw the provisions on corn, points to the limitations of existing trade rules, which are heavily influenced by industrial agriculture and biotechnology interests. In these times when governments face immense pressures from the Trump administration on all fronts, charting a policy course that challenges the status quo and corporate interests is particularly difficult to sustain.
The trade challenge to Mexico’s GM corn policies
The U.S. filed a formal dispute against Mexico in 2023, asserting that the Mexican government’s actions violate Sanitary and Phytosanitary Standards (SPS, food and plant safety provisions) in the USMCA. Even though it does not export corn to Mexico, Canada joined the complaint as a third party.
Civil society groups in the three countries submitted detailed comments on the case, focusing especially on the science behind Mexico’s restrictions on GMOs and glyphosate and Mexico’s transition to more sustainable production that advances rural livelihoods and food security. IATP’s comment (submitted with the Rural Coalition and the Alianza Nacional de Mujeres Campesinas) focused on the Mexican government’s rights to take these actions in order to comply with its commitments to Indigenous rights and conserving biodiversity as described in the USMCA text.
After a public hearing and several rounds of written comments by the Parties, the Panel released its final report on Dec. 20, 2025. Taken as a whole, the decision is overwhelmingly negative. It found against Mexico on every claim it took up, relied on the U.S. version of most disputed facts, invoked questionable science, and enunciated an overly broad definition of trade effects. We have published a detailed analysis of the ruling, focusing especially on the issues involving biodiversity and an exception intended to protect each country’s ability to honor its legal commitments to Indigenous peoples. A few highlights include that:
- The Panel found that the Mexican measures violated USMCA commitments on SPS, asserting that the voluminous scientific information Mexico supplied throughout the process did not meet the formal risk assessment criteria in the trade rules. It also found that even though the restrictions were also based on concerns that go beyond food safety — including honoring Mexico’s legal commitments to Indigenous people and enhancing biodiversity — those imperatives were eclipsed by the SPS rules.
- The Panel asserted that Mexico’s measures to avoid genetic contamination of native varieties by GM corn were not tailored to effectively address the risk and also impermissibly restricted trade with the U.S. since there were not equivalent measures to restrict hybrid corn. The Panel based this conclusion on its theory, which echoed U.S. arguments, that non-GM hybrid corn also threatens the integrity of native corn varieties. In rejecting the applicability of the Exhaustible Natural Resources Exception provided under the General Agreement on Tariffs and Trade (GATT), the Panel stated: “The Panel understands Mexico’s position to be that there are different types of threats to genetic integrity, and that traditional hybridization is different from transgenic introgression. But Mexico has not demonstrated that this is a distinction of any significance for its stated objective of preserving native varieties of corn.” [¶303, footnotes deleted].
- While the Panel accepted Mexico’s factual case that the domestic and international legal instruments it referenced establish a linkage between Indigenous Peoples and native corn, and that Mexico has a right to take measures to protect native corn in order to fulfill its legal obligations to Indigenous Peoples, it still rejected Mexico’s argument that the Indigenous Peoples Legal Rights Exception in USMCA Article 32.5 applied in this case. The Exception in USMCA Article 32.5 provides that even if a measure doesn’t comply with the SPS requirements of Article 9, a country may still be able to defend the measure if it is necessary to fulfill Indigenous legal rights. As it did in its rejection of the applicability of the GATT natural resources exception, the Panel claimed that Mexico’s measures “… single out GM corn and do not address other forms of gene flow to native corn by non-native, non-GM corn. Otherwise put, the Measures take aim only at a type of non-native corn that is imported from abroad, and not at any types of non-native corn that are grown domestically or imported.” [¶328]
- The Panel also gave short shrift to Mexico’s argument that the biodiversity conservation obligations in USMCA Article 24.15 on Trade and Biodiversity supported its Measures on GM corn. Mexico argued that Article 24.15 provides important context for its obligations to Indigenous peoples. Mexico argued, as did IATP in its brief, that its Measures “contribute to the protection of culture, heritage, traditions, communities, and the identity of people of indigenous origin, in relation to the natural biodiversity of native Mexican corn and its various varieties of corn.” [¶257] The Panel ignored Mexico’s arguments in its analysis of the Indigenous Peoples exception, leaving the impression that any context provided by the biodiversity article was of little account to the Panel.
- Astoundingly, the panel rejected food self-sufficiency as a valid policy goal, asserting that it is evidence of a disguised restriction on international trade: “The Panel’s view is that the 2023 Decree as a whole contains language that makes it clear that it intends to stop the importation into Mexico of GM corn. For example, Article 1 sets out the purpose of the 2023 Decree as establishing the actions to be taken by the relevant authorities “in relation to the use, sale, distribution, promotion and import” of both glyphosate and GM corn, in order to achieve various objectives, including self-sufficiency. The 2023 Decree also refers to Mexico’s “food self-sufficiency policies” on multiple occasions. Self-sufficiency by definition means the ability to provide for one’s own needs independently, without imports.” [¶306, footnotes deleted]. This is a willful misreading of the aspiration to eventually reduce Mexico’s dependence on imported corn as it builds up domestic supplies through more agroecological production.
- The Panel also found that actual trade effects, including an increase in trade, are irrelevant under Article 2. The decision states: “The fact that imports of GM corn from the USA apparently have increased to date has no bearing on the Article 2.11 analysis, because there is no requirement under Article 2.11 to show actual trade effects, as both Parties accept.” [¶252] At the same time, the Panel seems to assert that vague speculative impacts on trade are relevant: “The creation of market uncertainty about Mexico’s announced ‘substitution’ plan logically may well have a chilling effect on plans for continued export of these products.” [¶253] The Panel used circular reasoning to defeat Mexico’s claims that its policies were neutrally applied. It repeatedly found impacts on trade based on nothing but U.S.-claimed “market signals,” and discriminatory intent where Mexico had adopted neutral policies applicable both domestically and internationally.
- Because the Panel had already thrown out Mexico's policies on other grounds, it did not make any findings relating to a U.S. argument under USMCA Article 32.2(c) that Mexico’s measures to protect native corn varieties “nullified” expectations of the U.S. (and Canada) that were set when the USMCA was written in 2020. The U.S. argued that it expected Mexico to continue to approve GM corn varieties and accept imports of GM corn into the future. The nullification argument is a dangerous theory that could be used to challenge policy changes in the U.S. and Canada as well as Mexico, based on vague claims that “expectations” were upset. Such arguments are similar to — but even more vague than — now-discredited claims of investor expectations common to investor-state dispute settlement (ISDS), which was largely removed from USMCA at the behest of U.S. negotiators.
A path forward?
While it is difficult to see any silver lining here, despite ruling against Mexico repeatedly, the Panel nonetheless preserved a narrow path for Mexico to justify and implement its GM corn measures. The remedy recommended by the Panel is for Mexico to carry out a rigorous risk assessment. It potentially could do so and re-adopt versions of the policies challenged in this case at some point in the future.
Additionally, the Panel accepted that Mexico has the right to set the “Appropriate Level of Protection” (ALOP) for SPS measures under Article 9 at zero risk, which is a win for the precautionary principle — even though the Panel rejected Mexico’s arguments that reliance on the precautionary principle justified its classification of the substitution measure as a temporary policy. The Panel also agreed that Mexico can define for itself what constitutes Indigenous legal rights.
The USMCA Indigenous legal rights exception was nonetheless defeated by the requirement that the challenged measures not be “a disguised restriction on trade” and a cramped reading of the scope of those legal rights. While the self-judging nature of the Article 32.5 exception was upheld in part, it did not extend to Mexico’s designation of the measures it deemed necessary to implement Indigenous legal rights. The Panel failed to consider the interconnectedness of the USMCA’s biodiversity obligations and Indigenous legal rights. As IATP pointed out in its brief, the Environment Chapter imposes obligations on the Parties to protect biodiversity, and in Article 25.15.3 specifically recognizes the importance of Indigenous lifestyles and culture in conserving that biodiversity. Yet the Panel ignored Mexico’s arguments that its USMCA obligations to protect biodiversity should inform the scope of the Indigenous legal rights it was obligated to protect, despite agreeing that Mexico can define for itself the measures “necessary to fulfill its legal obligations to indigenous peoples,” Article 32.5.
The upcoming USMCA review provides an opportunity to further clarify the applicability of the Indigenous legal rights exception and biological diversity provisions. For example, the Indigenous exception could be clarified to explicitly address what the dispute panel can and cannot consider under the exception, and biodiversity provisions could be specifically referenced under the Indigenous legal rights exception. The nullification provisions in Article 32.2(c) should be clarified to ensure that vague and speculative claims cannot be used to undermine USMCA exceptions.
Provisions recognizing the Indigenous Peoples legal rights and the imperative to conserve biodiversity must have much higher levels of protection in trade agreements. The USMCA provisions were already far more specific and central than in prior trade agreements, yet in the final analysis that specificity counted for little. As long as these are exceptions and not carve-outs from the agreement, the burden of proof is on Mexico to defend its policies under trade rules that don’t recognize cultural issues that are so central to Mexico’s identity and policies. Trade agreements are designed to promote trade and corporate objectives, and USMCA is no exception. It is time for new rules that instead enhance each country’s right to determine its path to food sovereignty, human rights and sustainable livelihoods.
Read the full analysis here.
