Environmental Engineering Reference
In-Depth Information
Guide to WTO treaty provisions addressing the environment
This section examines the various provisions of WTO law that address the environ-
ment. The Marrakech Agreement Establishing the World Trade Organization (WTO
Agreement) mentions the environment and sustainable development in its Preamble. The
Appellate Body has stated that the WTO Preamble informs the interpretation of the WTO
covered agreements, and the jurists used the language above in the
US-Shrimp
case to help
interpret the WTO provisions at issue (Cameron and Campbell, 2002, p. 30).
The foundational WTO Agreement on trade in goods, the GATT, contains General
Exceptions to all rules in that Agreement, including the disciplines governing import bans,
domestic taxes and border tax adjustments. Although most environmental measures can
be carried out without infringing WTO rules, a trade-related environmental measure
(TREM) may come into con
fl
ict with trade rules.
6
With respect to the environment,
Article XX (General Exceptions) states:
Subject to the requirement that such measures are not applied in a manner which would consti-
tute a means of arbitrary or unjustifiable discrimination between countries where the same con-
ditions prevail, or a disguised restriction on international trade, nothing in this Agreement shall
be construed to prevent the adoption or enforcement by any contracting party of measures:
...(b) necessary to protect human, animal or plant life or health;
...(g) relating to the conservation of exhaustible natural resources if such measures are made
effective in conjunction with restrictions on domestic production or consumption. The intro-
ductory paragraph to Article XX, known as the 'chapeau' has been interpreted by the Appellate
Body as a condition for the use of any of the Article XX exceptions. The chapeau is examined
after a disputed measure is found to qualify provisionally under one of the specific exceptions.
Both the (b) and (g) exceptions would be usable for an environmental measure. A panel adjudi-
cating Article XX should first consider the threshold question to see if the governmental measure
being litigated fits within the range of policies covered by the exception. If so, then the specific
discipline in that exception would be examined. The Appellate Body has allocated the burden of
proof to the defendant government for all steps of the Article XX analysis.
For measures regarding human, animal, or plant life or health, the (b) exception requires that
the measure be 'necessary', and that term has been applied strictly. In
EC-Asbestos
, the
Appellate Body found that the XX(b) exception could justify the contested measure. According
to the Appellate Body in that case, the term 'necessary' in Article XX(b) requires that there be
no reasonably available and WTO-consistent alternative measure that the regulating government
could reasonably be expected to employ to achieve its policy objectives. To determine whether a
potential alternative is reasonably available, a panel will engage in a 'weighing and balancing
process' that considers: (1) the extent to which the alternative measure 'contributes to the real-
ization of the end pursued', (2) whether the alternative measure would achieve the same end, and
(3) whether the alternative is less restrictive of trade.
7
The Article XX(d) exception could also be relevant to environmental measures. That
exception is for measures necessary to secure compliance with certain laws or regulations
that are not GATT-inconsistent. In the
Mexico-Taxes on Soft Drinks
case, the Appellate
Body held that this exception is designed only to secure compliance with a WTO member's
own laws and regulations. This holding would seem to preclude the use of the XX(d)
exception to justify laws, such as the US Lacey Act,
8
that prohibits importation of
fi
sh
taken in violation of any foreign law.
For measures regarding the conservation of exhaustible natural resources, the (g) excep-
tion requires that the disputed measure be 'relating to' such conservation. In
US-Shrimp
,
the Appellate Body ended the controversy as to whether 'exhaustible' natural resources
