GATT/WTO SYSTEM AND THE PROTECTION OF NON-TRADE VALUES

Text of article XX:Text of article XX:

See the WTO websiteSee the WTO website

http://www.wto.org/english/docs_e/http://www.wto.org/english/docs_e/legal_e/gatt47_02_e.htm#articleXXlegal_e/gatt47_02_e.htm#articleXX

GATT/WTO SYSTEM AND THE PROTECTION OF NON-TRADE VALUES

Article XX : general exceptions from free tradeArticle XX : general exceptions from free trade protection of public interests and of State protection of public interests and of State

sovereigntysovereignty Sanitary and Phitosanitary Agreement and Sanitary and Phitosanitary Agreement and

Agreement on Technical Barriers to Trade are a Agreement on Technical Barriers to Trade are a dev't of article XXdev't of article XX

the meaning of art.XX is qualified by the meaning of art.XX is qualified by jurisprudencejurisprudence

evolutionary interpretationevolutionary interpretation

The Tuna-Dolphin cases

import ban by the US because nets used in import ban by the US because nets used in order to fish tuna accidentally catch dolphinsorder to fish tuna accidentally catch dolphins

violation of art.XI and justification by art.XX b)violation of art.XI and justification by art.XX b) extraterritoriality: indirect modification of WTO extraterritoriality: indirect modification of WTO

members' law members' law PPMs issue : process and production methods: PPMs issue : process and production methods:

can i distinguish products on the basis of the can i distinguish products on the basis of the way they are processed? way they are processed?

The Tuna-dolphin casesThe Tuna-dolphin cases

the measure is refused : the measure is the measure is refused : the measure is not “necessary”not “necessary”

GATT accused to be not favorable to GATT accused to be not favorable to env'tal protectionenv'tal protection

a second panel created about the same a second panel created about the same problem does not rule out the possibility problem does not rule out the possibility of extraterritorial measuresof extraterritorial measures

The LTRAT and the necessity principle

some paragraphs of article XX use the term some paragraphs of article XX use the term “necessary”“necessary”

necessity is a principle of int'l law : a measure necessity is a principle of int'l law : a measure is not stronger than necessary to achieve its is not stronger than necessary to achieve its aimaim

a measure is illegal if there are other measures a measure is illegal if there are other measures less restrictive and equally effective to reach less restrictive and equally effective to reach that aimthat aim

The LTRAT and the necessity principle

LTRAT= least trade restrictive alternative LTRAT= least trade restrictive alternative testtest

heavy burden of proof on the State heavy burden of proof on the State invoking art.XXinvoking art.XX

alternative measures are easy to find but alternative measures are easy to find but often more expensiveoften more expensive

art.XX is an exception= restrictive art.XX is an exception= restrictive interpretation interpretation

The LTRAT and the necessity principle

example: Thailand cigarettesexample: Thailand cigarettes import ban on cigarettes for public health import ban on cigarettes for public health

reasonsreasons the measure is not necessary: the measure is not necessary:

- less restrictive alternatives (training - less restrictive alternatives (training programs)programs)

- no internal measures = discrimination - no internal measures = discrimination

The weighing and balancing test

in the light of the critics need to refine the in the light of the critics need to refine the LTRATLTRAT

Korea-Beef (2000): imported and Korea-Beef (2000): imported and domestic meat are sold in different shopsdomestic meat are sold in different shops

Korea invokes art.XX d): protection of Korea invokes art.XX d): protection of consumersconsumers

inspiration from EU jurisprudenceinspiration from EU jurisprudence

The weighing and balancing test

assessing the necessity of a measure assessing the necessity of a measure implies the application of 3 criteria : implies the application of 3 criteria :

- importance of the aimimportance of the aim- effectiveness of the measureeffectiveness of the measure- trade restriction trade restriction

The weighing and balancing test

risk to apply the test differently according risk to apply the test differently according to the disputeto the dispute

ex. France - ban on asbestos productsex. France - ban on asbestos products the aim is of the highest importancethe aim is of the highest importance the measure is indispensablethe measure is indispensable trade restrictiveness is not assessedtrade restrictiveness is not assessed

The weighing and balancing test

problems of the test:

- are some interests more important than others?

- the third criterion implies a balancing of the aim with trade interests

- in principle WTO cannot put into discussion members' level of protection of public goods

The chapeau

applied after the paragraphs it deals with the way the measure is

implemented prevention of abuse of right striking a balance between the rights of

the State imposing the measure and the right of other States to free trade

The chapeauThe chapeau

ex. US-Shrimpsex. US-Shrimps

- import ban on shrimps fished without a - import ban on shrimps fished without a turtle excluding deviceturtle excluding device

- the measure falls under art.XX g) but it - the measure falls under art.XX g) but it violates the chapeauxviolates the chapeaux

- non transparent, unilateral and - non transparent, unilateral and discriminatory process discriminatory process

Article XX and the precautionary

principle

Brasilian tyres : unlikely cause-effect Brasilian tyres : unlikely cause-effect chain between the use of retreated tyres chain between the use of retreated tyres and the spread of diseasesand the spread of diseases

precautionary reasoning of the ABprecautionary reasoning of the AB application of the chapeau : decision by application of the chapeau : decision by

another judicial organ does not justify another judicial organ does not justify discrimination discrimination

Recent art.XX casesRecent art.XX cases EU-ban on seal meat and productsEU-ban on seal meat and products

- exception for Inuit traditional production- exception for Inuit traditional production

- seals are an endangered species- seals are an endangered species

- integral part of indigenous lifestyle- integral part of indigenous lifestyle case dealt with by the EU courtcase dealt with by the EU court ECHR and IACHR case-law ECHR and IACHR case-law possible application of art.XX g)possible application of art.XX g)

Recent art.XX casesRecent art.XX cases

Korea-imports of bovine meat from Korea-imports of bovine meat from Canada (panel stage) : fear of BSECanada (panel stage) : fear of BSE

the ban can only be lifted by Korean the ban can only be lifted by Korean assemblyassembly

EU-poultry meat from US: ban on any EU-poultry meat from US: ban on any chemical product other than waterchemical product other than water

various EU agencies issued reports various EU agencies issued reports according to which there's no real risk according to which there's no real risk

China-raw materialsChina-raw materials

export ban of raw materials supported by:export ban of raw materials supported by:

- sovereignty over natural resources- sovereignty over natural resources

- need to protect and manage raw - need to protect and manage raw materialsmaterials

- DCs right to preserve resources for their - DCs right to preserve resources for their economic dev'teconomic dev't

art.XX cannot be used for violations of art.XX cannot be used for violations of accession protocolsaccession protocols

China-raw materialsChina-raw materials

art.XX g): general principlesart.XX g): general principles is the measure related to...? no conflict is the measure related to...? no conflict

between sovereignty, sustainable dev't between sovereignty, sustainable dev't and trade liberalisationand trade liberalisation

is the measure adopted in conjunction is the measure adopted in conjunction with...? even-handednesswith...? even-handedness

China-raw materialsChina-raw materials

art. XX g) : applicationart. XX g) : application is the measure related to..? NOis the measure related to..? NO

- it would make more sense to limit extraction and - it would make more sense to limit extraction and not exportsnot exports

- long-term effects on the downstream sector - long-term effects on the downstream sector (subsidy)(subsidy)

- why a quota and not a duty? the link with the - why a quota and not a duty? the link with the aim is not clear aim is not clear

China-raw materialsChina-raw materials

is the measure adopted in conjunction is the measure adopted in conjunction with...? NOwith...? NO

- long list of domestic conservation - long list of domestic conservation measures but their actual effect is not measures but their actual effect is not clearclear

is the measure even-handed? NOis the measure even-handed? NO

- the import ban and the production cap do - the import ban and the production cap do not have an even impact on not have an even impact on importers/exportersimporters/exporters

China-raw materialsChina-raw materials

art.XX par. b) supported by:art.XX par. b) supported by:

- production from scrap products is less - production from scrap products is less pollutingpolluting

- export duties make sure there is a stable - export duties make sure there is a stable supply of scrapssupply of scraps

- restrictions on primary production reduce - restrictions on primary production reduce pollutionpollution

China-raw materialsChina-raw materials

restrictions on primary productsrestrictions on primary products

- the measure does not fall under par.b) because - the measure does not fall under par.b) because the real aim is economicthe real aim is economic

- contribution to the aim- contribution to the aim

export restrictions = reduced production and export restrictions = reduced production and pollution?pollution?

unreliable datasetunreliable dataset

upstream-downstream interactions not accounted upstream-downstream interactions not accounted forfor

China-raw materialsChina-raw materials

selection effect?selection effect?

link between export restrictions on raw materials link between export restrictions on raw materials and production of value-added goods?and production of value-added goods?

env'tal Kuznets curveenv'tal Kuznets curve

- trade restrictiveness- trade restrictiveness

China able to affect world pricesChina able to affect world prices

entry of new and more efficient competitors entry of new and more efficient competitors uncertainuncertain

China-raw materialsChina-raw materials

- existence of alternatives- existence of alternatives

improved technology to reduce the level of improved technology to reduce the level of pollutionpollution

recycling of consumer goodsrecycling of consumer goods

increased env'l standardsincreased env'l standards

China says there are already in place/they do not China says there are already in place/they do not workwork

the panel disagrees: China policy do not include the panel disagrees: China policy do not include these measures and those in place do not workthese measures and those in place do not work

China-raw materialsChina-raw materials

restrictions on scrap productsrestrictions on scrap products

scrap = less pollution?scrap = less pollution?

export restrictions necessary to enhance export restrictions necessary to enhance recycling?recycling?

reducing scrap price can also reduce the reducing scrap price can also reduce the incentive to collect it incentive to collect it

- the are alternatives- the are alternatives CHINA IS IN BREACHCHINA IS IN BREACH