Treaty that went into effect in 1994 and creates an economic bloc between Canada, the United States, and Mexico. The North American Free Trade Agreement (or Tratado Libre de Comercio), which went into effect in 1994, creates an economic bloc between Canada, the United States, and Mexico. Designed to promote free trade and more efficient transfers of capital and goods, the agreements have been criticized by many Mexican and U.S. environmental groups insisting on the inclusion of stricter provisions regarding negative impacts on the biosphere and working peoples' conditions.