ABSTRACT
North American Free Trade Agreement (NAFTA) trade and tightly related investment liberalisations were particularly important for smaller firms from smaller countries, which depend on access to the larger US market for much of their trade and, in Canada's case, for much of its gross national product (GNP). This chapter discusses the phenomenon of environmental regulatory protection and examines how emerging conditions of 'complex institutional responsiveness' affect the ability of US, Canadian, and Mexican governments to take environmental or trade actions that have an impact on the prevailing behaviour in the other domain. There has been a similar post-NAFTA expansion in the range of environmental regulatory protection, seen in the broad range of sectors that have been affected by it. The new generation of environmental regulations, with provisions for expanded public participation, and the activism of sub-federal governments have increased the access and power wielded by such groups.
