Environmental Engineering Reference
In-Depth Information
in a world increasingly controlled by private industry, mainly multinational
corporations.
The cost of environmental protection to businesses
There is good reason to ask why states and their taxpayers should be respon-
sible for environmental protection if environmental damage is caused by
multinational businesses with global shareholders, employees and strategies.
Before open markets, a state was able to control the operations of companies
through its political and legal system. This was because big businesses did not
actually need to compete, since there were fewer competitors fi ghting for
market share. Economic globalization has completely changed this.
We fi nd ourselves, therefore, in a very different global situation now.
Multinational businesses have become increasingly competitive, and are able
to determine factors such as which country offers them the cheapest labour,
the safest operational environment, and the least environmental obligations in
expense for companies, so those states that mandate or enforce only minimal
environmental obligations (or, for example, low labour standards, weak tax
requirements, lax anti-corruption measures) are potentially more attractive to
companies to locate within their jurisdiction. Some experts argue that this has
already caused competition between countries to reduce environmental
protection measures (the 'race to the bottom').
Ships are being withdrawn from the registries of those countries that set
stricter rules related to their condition and operation. Certain so-called 'fl ag of
convenience' states set no strict requirements on ships, and collect high tax
revenue by offering ships the opportunity to register with limited oversight.
As the regulation of seafaring is essentially based on the principle that the fl ag
state has jurisdiction, it can be diffi cult to bring these states to account for
failing to regulate and control the extent to which ships are fulfi lling safety and
environmental protection standards.
Companies that continue to operate in countries with stricter environmen-
tal controls face unequal competition as rivals based in countries with less strict
environmental controls can potentially be more competitive. Shouldn't inter-
national environmental law regulate companies instead of states? Wouldn't it
be better if international agreements were concluded by businesses in order to
lay down identical environmental obligations to all those who operate in a
particular market segment?
The 'polluter pays' principle
International environmental law is not an independent legal system, as we
have seen above, but one of several branches of international law (such as
international human rights, international law of the sea, and international trade
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