Environmental Engineering Reference
In-Depth Information
includes requirements that governments compensate companies hurt by changes in envi-
ronmental rules that may mean that the exceptions are in practice less environment-
friendly than they are in the WTO context (NAFTA, 1993, Chapter 11). But the
environmental innovation in NAFTA is a side-agreement, called the North American
Agreement on Environmental Cooperation (NAAEC), that addresses environmental reg-
ulation explicitly (CEC, 1993).
The NAAEC has two key components. The
fi
rst is a requirement that members of
NAFTA e
ectively enforce their own environmental laws. The Agreement does not
specify what those laws should be. It notes that 'each Party shall ensure that its laws and
regulations provide for high levels of environmental protection' (CEC, 1993, Article
3).The Agreement does not de
ff
ne what it means by high levels, but it does require that
individuals and corporations hurt by poor enforcement of environmental rules have legal
recourse. The second key component of the NAAEC is the creation of a new institution,
the Commission for Environmental Cooperation (CEC) to oversee the trade and envi-
ronment aspects of NAFTA, and to help with the coordination and enforcement of envi-
ronmental law within the NAFTA area. The CEC di
fi
ers from the CTE in that the former
has an executive rather than a legislative function. It is sta
ff
ed with people who answer to
it, rather than to member governments, and its job is to implement policy rather than
create it. There are di
ff
ective the CEC has been since its
creation a decade and a half ago (Kirton, 2002), but few would disagree that it represents
an approach to dealing with trade and environment issues that is distinct from the WTO
exceptions model.
Of the two potential problems noted at the beginning of this section, the exceptions
model of dealing with the e
ff
erences of opinion about how e
ff
ff
ects of trade rules on environmental management is on the
whole more e
ne their own level of appro-
priate environmental management. Meanwhile, the environmental rules model is more
e
ff
ective at protecting the ability of states to de
fi
ning their level downwards to create comparative
advantage. The exceptions model evolved in the context of a broadly multilateral agree-
ment, in which developed countries were the key players. The environmental rules model
was developed in the context of a more limited trilateral negotiation, in which a powerful
developed country (the USA) was concerned about the lowering of levels of environ-
mental regulation as a tool for creating comparative advantage by a developing country
(Mexico). In other words, in the
ff
ective at preventing states from de
fi
rst case the more powerful developed countries were
more concerned about maintaining their own freedom to regulate, and in the latter case
the key developed country was more concerned about limiting the freedom of the relevant
developing country to negotiate. We can therefore expect a tendency towards the excep-
tions model in more multilateral trade institutions, where the more developed countries
involved are more concerned about each other than about the less developed countries.
Meanwhile, we can expect the environmental rules model when there are fewer countries
involved, and when the richer ones are more concerned with the poorer ones than with
each other.
The pattern of existing organizations seems to bear out these expectations. Following
NAFTA, the USA has engaged in a series of bilateral and small-group trade negotiations
with developing countries. These agreements tend strongly to include explicit environ-
mental side-agreements modeled on the NAAEC, although without the creation of a new
bureaucracy modeled on the CEC (e.g. USTR, 2006, ch. 18). The developing countries in
fi
