Macquarie Journal of International and Comparative Environmental Law
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Macquarie Journal of International and Comparative Environmental Law |
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ABDUL GHAFUR HAMID @ KHIN MAUNG SEIN[*]
NIK AHMAD KAMAL NIK MAHMOD[**]
The debate over free trade and protection of the environment has been on the table of the WTO since its very inception. In 2001, the Doha Development Agenda initiated a set of negotiations on the relationship between the WTO and MEAs. However, the negotiations have so far failed to yield any tangible result. This paper examines the adequacy of the environmental exceptions to WTO rules. Environmentally related disputes decided by the WTO Panel or Appellate Body are analysed to determine whether the rulings are one-sided and if trade rules are given preference over environmental concerns. The paper focuses on how to address the issue of the relationship between the WTO rules and MEAs in light of relevant principles of international law. The paper concludes with suggestions for improvement in the legal rules and dispute resolution.
When the General Agreement on Tarrifs and Trade (GATT) was established after World War II, environmental protection was not regarded as a major trade-related issue. Article XX of the GATT was the only provision that addressed environmental issues. Further, the GATT did not articulate the methods or measures by which the necessity for protection of the environmental should be balanced against strict compliance with the GATT basic principles.
Although the world has dramatically changed, the GATT 1994, the main WTO Agreement on Trade in Goods, is essentially the same as the GATT 1947 with corresponding fundamental principles, Article XX being the only exception for environmental concerns. The Committee on Trade and Environment (CTE) was established under the WTO with the mandate to investigate the relationship between environmental and trade policies.[1] Formation of the CTE ‘was a reaction by GATT contracting parties to the controversy caused by the tuna-dolphin dispute[2] [which] had caused NGOs to consider the GATT anti-environment, and developing countries to worry that environmental norms were being used to restrict trade.’[3]
After the tuna-dolphin dispute, states made an attempt to reconcile trade and environmental concerns at the 1992 Rio Conference on Environment and Development (UNCED)[4]. The Rio Summit adopted Agenda 21, a major non-binding policy document, the implementation of which is overseen by the UN Commission on Sustainable Development. Principle 12 of the Rio Declaration advances three key elements:
(i) Environmental measures dealing with transboundary or global problems should be based on international agreements;
(ii) Unilateral action to deal with such problems should be avoided; and,
(iii) Environmental measures should not be arbitrarily or unjustifiably discriminatory or a disguised restriction on trade.[5]
The CTE has taken Principle 12 as an operational guideline. It also follows the policy guideline of the Preamble to the Agreement establishing the World Trade Organization, which “allow[s] for the optimal use of the world’s resources in accordance with the objective of sustainable development, seeking both to protect and preserve the environment and to enhance the means for doing so in a manner consistent with their respective needs and concerns at different levels of economic development.”[6] After reaffirming commitment to the objective of ‘sustainable development,’ the Doha Ministerial Declaration of November 14, 2001 proclaims:
We are convinced that the aims of upholding and safeguarding an open and non-discriminatory multilateral trading system, and acting for the protection of the environment and the promotion of sustainable development can and must be mutually supportive.... We recognize that under WTO rules no country should be prevented from taking measures for the protection of human, animal or plant life or health, or of the environment at the levels it considers appropriate, subject to the requirement that they are not applied in a manner which would constitute a means of arbitrary or unjustified discrimination between countries where the same conditions prevail, or a disguised restriction on international trade, and are otherwise in accordance with the provisions of the WTO Agreements.[7]
In accordance with the Work Program of the Doha Ministerial Declaration, negotiations have been made on the relationship between existing WTO rules and specific trade obligations set out in Multilateral Environmental Agreements (MEAs).[8] However, the WTO negotiations so far have failed to yield any tangible result. Meanwhile, there have been arguments on the part of environmentalists that the debate about the relationship between trade and environment is threatening to let trade rules further encroach into the regulatory scope of MEAs.[9] They argue that the binding provisions defining the WTO’s scope and purpose largely ignore non-trade concerns (NTCs).[10] According to them, the WTO Agreement requires all member countries to ensure the conformity of its laws, regulations and administrative procedures with its obligations. For example, the WTO dispute settlement procedures allow Panels to declare municipal laws and regulations as illegal trade barriers. The member country accused of impairment of its WTO obligations must either amend the non-complying law or face WTO-authorized sanctions. This enforcement of its supranational powers, through WTO-appointed Dispute Resolution Panels, they said, has resulted in growing criticism that the WTO is a fundamentally undemocratic institution.
On the other hand, there have been arguments that nothing in the WTO Agreements requires that free trade be accorded priority over environmental protect. The preamble to the WTO Agreement acknowledges that expansion of production and trade must allow for ‘the optimal use of the world’s resources in accordance with the objective of sustainable development, seeking both to protect and preserve the environment.’[11] Furthermore, they emphasize the fact that many WTO Agreements contain exceptions for environmental measures.[12]
This paper argues that both promotion of trade and protection of the environment are crucial, what is important is to strike the correct balance between the two objectives of free trade and environmental protection. First the relevant WTO rules will be examined in order to determine the adequacy of the environmental exceptions to the basic obligations under these rules. Environmentally related disputes decided by the WTO Panel or Appellate Body will then be analysed to determine whether the rulings are one-sided with trade rules being given preference over environmental concerns. The paper will then focus on how to address the issue of the relationship between the WTO rules and MEAs in light of the sources of the WTO law and other relevant principles of international law. The paper will conclude with suggestions for improvement in the legal rules and dispute resolution.
GATT 1994, like its predecessor GATT 1947, is primarily founded on principles of free trade, namely the non-discrimination principles of most-favoured-nation and national treatment, and the elimination of quantitative restrictions.
Non-discrimination is the main principle on which the rules of the multilateral trading system are founded. It ensures that national environmental protection policies cannot arbitrarily discriminate between foreign and domestically made products, or between products imported from different trading partners. Non-discrimination has two components in the WTO:
Most-favoured-nation treatment (MFN): The MFN treatment is the cornerstone for achieving the objective of non-discrimination in international trade. Under the WTO Agreements, countries cannot normally discriminate between their trading partners. If a country grants another a special favour (such as lowering of a trade barrier - tariffs or non-tariffs - or opening up of a market), that country has to do so for the same goods or services for all its trading partners. This principle is known as MFN treatment. It is so important that it is the first article of the GATT (Art I), which governs trade in goods. MFN is also a fundamental principle in the General Agreement on Trade in Services (GATS) (Art II)[13] and the TRIPS (Art. 4)[14] although in each agreement the principle is handled slightly differently. Article I of the GATT 1994 reads:
…[A]ny advantage, favour, privilege or immunity granted by any contracting party to any product originating in or destined for any other country shall be accorded immediately and unconditionally to the like product originating in or destined for the territories of all other contracting parties.[15]
National treatment: The principle of national treatment can be viewed as a corollary to the MFN treatment. According to this principle, imported and locally-produced goods should be treated equally - at least after the foreign goods have entered the market. The same should apply to foreign and domestic services, and to foreign and local trademarks, copyrights and patents. This principle of national treatment (giving others the same treatment as one’s own nationals) is also found in all the three main WTO Agreements.[16] Article III of GATT 1994, for example, provides:
The products of the territory of any contracting party imported into the territory of any other contracting party shall be accorded treatment no less favourable than that accorded to like products of national origin in respect of all laws, regulations and requirements affecting their internal sale, offering for sale, purchase, transportation, distribution or use.[17]
Article XI of GATT 1994 states:
No prohibitions or restrictions other than duties, taxes or other charges, whether made effective through quotas, import or export licences or other measures, shall be instituted or maintained by any contracting party on the importation of any product of the territory of any other contracting party or on the exportation or sale for export of any product destined for the territory of any other contracting party.[18]
The Article addresses the elimination of quantitative restrictions through quotas, import or export licenses, or other measures, introduced or maintained by countries on the importation or exportation of products. The main purpose of prohibiting such restrictions is to encourage countries to convert them into tariffs, which are more transparent and less likely to distort trade. This Article has been violated in the context of a number of environmental-related disputes in which countries have imposed bans on the importation of certain products, and is thus subject to action that can be taken under the WTO rules.
The “General Exceptions” provision of the GATT, Article XX, constitutes conditional exceptions to GATT obligations, even those in Articles I, III and XI. Although the word “environment” is not used, Article XX may be applied to justify environmentally inspired rules that collide with trade. The wording of Article XX is as follows:
Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where the same conditions 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.[19]
Paragraphs (b) and (g) are designed to allow WTO members to adopt policy measures that would normally be inconsistent with GATT, when “necessary” to protect human, animal or plant-life health, or if related to the conservation of exhaustible natural resources. The opening paragraph (the “chapeau”) of Article XX is designed to ensure that the measures inconsistent with the GATT do not result in arbitrary or unjustifiable discrimination and do not constitute disguised protectionism. The burden of showing that an Article XX exception applies lies on the party asserting it as a defense.
The chapeau: The exceptions under Article XX are qualified by what is commonly known as the “chapeau” (the opening paragraph). Even if a measure meets the requirements of a provision of Article XX, it would be illegal if it constitutes (1) arbitrary or unjustifiable discrimination between countries where the same conditions prevail; or (2) a disguised restriction on international trade.[20].
The anti-discrimination portion of the chapeau forbids both arbitrary and unjustifiable discrimination between “countries” without qualification; this prohibition appears to have the same field of application as GATT Articles I and III. It would include all countries, both importing and exporting. However, in contrast to Articles I and III, it would mean, by implication, that Article XX allows discrimination between countries, as long as it is not arbitrary or unjustifiable.
The best example of the application of the ‘chapeau’ is found in the U.S. Gasoline dispute.[21] Venezuela and Brazil claimed that the US Gasoline Rule, established under the Clean Air Act Amendments of 1990, was inconsistent with GATT Article III (national treatment, i.e. treating domestic and imported products equally), and was not protected by GATT Article XX exceptions. The case arose because it was alleged that the United States applied stricter rules on the chemical characteristics of imported gasoline than it did for that which was domestically refined. The complainants argued that this was unfair because US gasoline did not have to meet the same standards – it violated the national treatment principle and could not be justified as an exception to normal WTO rules. A WTO panel, upon examining the US Gasoline Rule, concluded that it was not consistent with Article III: 4 of the GATT and could not be justified by any of the Article XX exceptions.
The Appellate Body came to the same conclusion, but its reasoning was different from that of the panel. The Appellate Body’s report, for the first time in the fifty-year history of GATT/WTO dispute settlement, provides an authoritative interpretation of the chapeau. Whereas the panel concluded that the U.S. Gasoline Rule failed the tests of Article XX (g), the Appellate Body found that those requirements were satisfied, but that the measure constituted “unjustifiable discrimination” and a “disguised restriction on international trade.” The Appellate Body gave the following interpretation of the chapeau:
“Arbitrary discrimination”, “unjustifiable discrimination” and “disguised restriction” on international trade may . . . be read side-by-side; they impart meaning to one another. . . . We consider that “disguised restriction,” . . . may properly be read as embracing restrictions amounting to arbitrary or unjustifiable discrimination in international trade taken under the guise of a measure formally within the terms of an exception listed in Article XX. Put in a somewhat different manner, the kinds of considerations pertinent in deciding whether the application of a particular measure amounts to “arbitrary or unjustifiable discrimination”, may also be taken into account in determining the presence of a “disguised restriction” on international trade. The fundamental theme is to be found in the purpose and object of avoiding abuse or illegitimate use of the exceptions to substantive rules available in Article XX.[22]
Thus, the Appellate Body interpreted the chapeau as invalidating a measure that otherwise meets the requirements of Article XX if it involves unjustified or arbitrary discrimination. The success of the Appellate Body in this respect is commendable. Nevertheless, its interpretation of Article XX appears to be an entirely textual based approach. Although it is true that the text is the basis for interpretation of a treaty rule, our concern here is whether the text of the WTO rules are adequate for the protection of the environment in view of the fact that GATT provisions were drafted in 1947 at a time when environmental protection was not considered to be a serious issue.
There has already been a series of environmentally-related disputes that have arisen within the framework of the WTO.[23] Six of these occurred under the GATT, and five under the WTO itself. The “Tuna Dolphin” case,[24] which was decided by a GATT panel, will be commented on first to demonstrate the seriousness of the problem followed by an examination of the WTO’s approach in respect of the environmentally-related disputes.
Before 1991, the relationship between protection of the environment and international trade was a topic that attracted little attention. However, the situation totally changed with the decision of the Tuna Dolphin I case in which a GATT Panel declared a US embargo on tuna caught by fishing methods causing high dolphin mortality to be illegal.[25] This case created an explosive academic debate and was the catalyst for an intense clash between trade specialists and environmentalists.[26]
Acting under the US Marine Mammal Protection Act (MMPA)[27]
, the United States had adopted a unilateral ban on imports of yellow-fin tuna using fishing methods that killed dolphins, a protected species under the MMPA. Upon Mexico’s complaint to the GATT, a dispute settlement Panel found that the US tuna embargo violated GATT Article XI:1, which forbids measures prohibiting or restricting exports or imports. The United States sought to justify the embargo under GATT Article III:1 and III:4 because US fishermen were subject to the same MMPA rules. The GATT panel rejected the US argument on the ground that Article III:1 and III:4 permit only regulations relating to products as such. As the MMPA regulations concerned harvesting techniques that could not possibly affect tuna as a product, the ban on tuna could not be justified.
This holding was reiterated by a second GATT panel in the Tuna-Dolphin II decision, which involved the legality of a secondary embargo on tuna products from countries that processed tuna caught by the offending countries.[28] The Tuna Dolphin II panel condemned the unilateral boycott in even stronger terms.
These two GATT panel decisions represent the first tentative steps of the multilateral trading system to reconcile with the protection of the environment. Neither decision was binding under the GATT because both were not adopted by the contracting parties. Even if they were adopted, they would have little force as precedents because their reasoning was partially inconsistent and the decisions of prior GATT or WTO panel are not binding on future panels. Furthermore, the WTO Appellate Body is initiating its own approach to Article XX that makes greater allowance for legitimate measures of environmental protection. Much of the reasoning in the Tuna Dolphin cases has been effectively overruled later on.
In 1995, after the WTO was launched and the world’s trade dispute process was restructured, the appellate body of the WTO was asked again to look at a similar dispute, known as the “Shrimp-Turtle” case.
In 1997, India, Malaysia, Pakistan and Thailand requested the establishment of a panel against the US concerning a ban on importation of shrimp and shrimp products from these complainants imposed by the US under Section 609 of US Public Law 101-102. The US Endangered Species Act of 1973 listed as the five species of sea turtle as endangered. The Act requires that US shrimp trawlers use “turtle excluder devices” (TEDs) in their nets when fishing in areas where there is a significant likelihood of encountering sea turtles. Section 609 of US Public law deals with imports ruling that shrimp harvested with technology that may adversely affect sea turtles may not be imported into the United States. Essentially the act requires that shrimp boats use TEDs at all times. The complainants alleged that the US import ban violated Articles I, XI and XIII of GATT 1994.
The Panel found that the import ban on shrimp and shrimp products as applied by the United States is inconsistent with Article XI:1 of the GATT 1994, (which limits the use of import prohibitions or restrictions), and could not be justified under GATT Article XX (which deals with general exceptions to the rules, including for certain environmental reasons).
On appeal, the Appellate Body reversed the Panel’s decision that the US measure at issue is not justified under Article XX of the GATT 1994. Yet it concluded that the US measure, while qualifying for provisional justification under Article XX (g), fails to meet the requirements of the chapeau (in particular, the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries) of Article XX. The US lost the case, not because it sought to protect the environment but because it discriminated between WTO members. It provided countries in the Western hemisphere – mainly in the Caribbean – technical and financial assistance and longer transition periods for their fishermen to start using turtle-excluder devices. It did not give the same advantages, however, to the four Asian countries that filed the complaint with the WTO.
The Appellate Body concluded that it was legitimate in WTO disputes to refer to the international obligations member states agreed to under multi-lateral environmental agreements (MEAs); these, like the GATT, are valid and concurrent international legal instruments.[30] According to the Appellate Body, however, the United States had failed in that particular instance to engage thoroughly in dialogue with countries it identified as potentially breaching U.S. environmental regulations. According to the Appellate Body, it was acceptable to put environmental protection measures in place, so long as the United States treated all trading partners equally; the United States, could not (as it in fact did do) offer technical assistance to some countries but not others.[31] As a result, the United States was required by the GATT to address and rectify this issue.
The ‘Shrimp-Turtle’ case is a clear indication of the fact that GATT Article XX(b) and (g) exceptions may be used to protect the environment, provided that the measures are not discriminatory in nature. The ruling was also an acknowledgment that the WTO Appellate Body respected international obligations assumed by the United States under the Convention on International Trade in Endangered Species (CITES).[32] Before the adoption of this ruling, many environmentalists were concerned because they felt that multilateral environmental agreements, such as CITES, should be accorded the same significance in WTO dispute panels as the obligations of member countries under the GATT.[33] The “Shrimp-Turtle” decision somewhat satisfied the environmentalists, because it found that the United States could invoke the exception even without being party to an MEA, so long as it acted in a non-discriminatory fashion.
In the EC-Asbestos case both the Panel and the Appellate Body rejected Canada’s challenge against a French import ban on asbestos and asbestos-containing products. This reinforced the view that the WTO Agreements support members’ ability to protect human health and safety at a level they deem appropriate.
Chrysotile asbestos is generally considered to be a highly toxic material, exposure to which poses significant risks to human health. However, due to certain qualities (such as resistance to very high temperature), it has been widely used in various industrial sectors. To control the health risks associated with asbestos, the French Government imposed a ban on the substance as well as on products that contained it. The European Community justified the prohibition on the grounds of human health protection. Being the second largest producer of asbestos world-wide, Canada contested this prohibition through the WTO claiming that the Decree violated GATT Articles III: 4 and XI. The European Community (EC) requested the panel to confirm that the Decree was either compatible with Article III: 4 or necessary to protect human health within the meaning of Article XX (b).
Despite finding a violation of Article III, the panel ruled in favour of the EC. Under Article III (which requires countries to grant equivalent treatment to like products) the Panel found that the EC ban constituted a violation since asbestos and asbestos substitutes had to be considered “like products” within the meaning of that Article. However, the Panel found that the French ban could be justified under Article XX (b). The measure could be regarded as one which was “necessary to protect animal, human, plant life or health” reference. It also met the conditions of the chapeau of Article XX. On appeal, the WTO Appellate Body upheld the panel’s ruling in favour of the EC, while modifying its reasoning on some issues. This ruling is a clear indication that the WTO dispute settlement mechanism would uphold any measure by the member states to protect the environment so long as it does not constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on international trade.
As stated earlier, Venezuela and Brazil claimed that the Gasoline Rule was inconsistent, among other things, with GATT Article III (national treatment i.e. treating domestic and imported products equally), and was not covered by GATT Article XX. The Panel found that the Gasoline Rule was inconsistent with Article III because it discriminated against the gasoline imports, and could not be justified under Article XX (b) (d) or (g). On appeal, the Appellate Body upheld the panel’s conclusion (although it made some changes to the panel’s legal interpretation). It modified the panel report on the interpretation of GATT Article XX (g). The Appellate Body found that the baseline establishment rules contained in the Gasoline Rule fell within the terms of Article XX (g), but failed to meet the requirements of the “chapeau” of Article XX. It concluded, however, that Article XX (g) was not applicable in this case.
The complainants brought a case against European Communities, asserting that the moratorium applied by the EC from October 1998 on the approval of biotech products, restricted imports of agricultural and food products from their countries.
On 29 September 2006, the panel reports were circulated to Members. The Panel found that the European Communities applied a general de facto moratorium on the approval of biotech products between June 1999 and August 2003. The Panel further found that, by applying this moratorium, the European Community acted inconsistently with its obligations under Annex C(1)(a), first clause, and Article 8 of the WTO Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement) because the de facto moratorium led to undue delays in the completion of EC approval procedures. The Panel, however, ruled that the European Community had not acted inconsistently with obligations under other provisions raised by the complainants.
At the Dispute Settlement Body (DSB) meeting on 19 December 2006, the EC announced its intention to implement the ruling of the Panel. However, due to the complexity and sensitivity of the issues involved, it requested a reasonable period of time for implementation. Furthermore, it decided not to appeal the Panel ruling. Nevertheless, several civil society and environmental groups have sharply criticized the EC’s decision, voicing concerns that some of the panel’s conclusions could undermine other bodies of international law. In particular, they have warned that the ruling could undermine the ‘precautionary principle’[37], because the panel concluded that it was not obliged to take other international treaties into account if not all parties to the dispute were also parties to these treaties.[38] In fact, the Panel’s ruling is correct as far as international treaties are concerned but what the Panel failed to recognize was the role of customary international law and that the precautionary principle is accepted by many international lawyers as reflecting a customary rule.
On 17 November 2005, the European Community brought a case against Brazil on the imposition of measures that adversely affect exports of retreaded tyres from the EC to the Brazilian market. Brazil had justified its import restrictions on environmental and health grounds. During the course of the proceedings, environmental groups submitted amicus curiae briefs to the Panel pertaining as to why the import restrictions were necessary. It was the subject of heavy debate because it involved a clash between rules that promote open trade and those to promote environmental protection. The case is also notable for being the first in which a developed country challenged an ostensibly environmental measure taken by a developing one.
Brazil maintained that its measures were justified under GATT Article XX, which spells out exceptions in which members may deviate from their WTO obligations. The EC countered that such an argument was not justifiable, not only because it imported retreaded tyres from elsewhere in Mercosur, but that it also continued to import used tyres to convert them into retreaded tyres domestically.
On 12 June 2007, the Panel’s report was circulated to Members. The Panel concluded that Brazil’s import prohibition on retreaded tyres was inconsistent with Article XI:1 of the GATT 1994 because it prohibited the issuance of import licences for retreaded tyres. It further ruled that it was not justified under Article XX because Brazil applied the measure in a manner that constituted a means of unjustifiable discrimination and a disguised restriction to international trade within the meaning of the chapeau of the same article.[40]
Out of the six cases analyzed above, the WTO decided in favour of the environmental measures in only one: that is, the EC-Asbestos case. It is clear that the panel decisions in the Tuna Dolphin case were totally unsatisfactory. In the remaining four cases, the WTO in effect decided the environmental measures to be contrary to the WTO rules. Not because the WTO does not recognize environmental concerns but rather that the measures did not fulfil the requirement of the chapeau (in the three cases) and failure to comply with the requirement of ‘undue delay’ under the SPS Agreement (the Biotech case).
Environmentalists argue that the WTO Dispute Settlement Body is anti-environmental. While trade specialists argue that the Appellate Body is establishing its own jurisprudence on the WTO rules in respect of environmentally-related disputes and that the interpretations of Article XX of the GATT 1994 by the Appellate Body have transformed the article into an adequate tool for a balanced approach to the trade and environment controversy.[41] Even though the latter statement could not entirely be accepted, we can at least say that the Appellate Body has done its best to address the issue of environmentally-related disputes on the basis of whatever is available under the present WTO rules. The adequacy or otherwise of these rules is another matter.
A question of paramount importance is how the WTO system will accommodate multilateral environmental agreements (MEAs) that employ trade restrictions. There are over 250 MEAs dealing with various environmental issues that are currently in force. About 20 of these include provisions that can affect trade. Three major MEAs will be analyzed as examples.
The Montreal Protocol on Substances that Deplete the Ozone Layer (Montreal Protocol) is the most widely accepted MEA and at the time of writing, there are 191 states parties[43]. It is, therefore, an extremely relevant MEA in relation to the WTO due simply to the fact that among the 191 States parties, 147 are WTO members.[44] The Protocol phases out the consumption and production of certain Ozone-depleting substances (ODS) and adopts trade controls that are more restrictive as to non parties than parties. Article 4 deals with the control of trade with non-parties and requires each party to ban the import of controlled substances from any state not a party to the Protocol.[45] Although trade measures are supplementary to the phasing out schedules, they are of major importance to the Protocol and the international ozone regime. It is apparent that the more restrictive trade measures against non-parties clashes with the basic rule of the WTO: non-discrimination.
Furthermore, the Montreal Protocol is equipped with an enforcement mechanism that provides the institutional and legal basis for ordering trade sanctions against violators. For example, in accordance with the “Non-compliance Procedure” adopted in 1998,[46] an ‘Implementation Committee’ was established in order to supervise the implementation of the Protocol. In the event of a submission by one party regarding the non-compliance of another, the Implementation Committee shall review the submission and then report to the Meeting of the Parties (MoP) any recommendations it considers appropriate. On the basis of the report, the Parties may decide upon and call for necessary measures to enforce full compliance with the Protocol. To restrict the extent and content of the measures members may take, the 4th Meeting of the Parties sets out a list of measures that might be taken in respect to non-compliance. In addition to non-coercive and incentive-based measures, suspension of trade is clearly specified in paragraph C.[47] This provision has, however, not yet been invoked. In any case, what is important here is that the Protocol, as an MEA, has its own system of dispute resolution and enforcement.
The Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), was adopted in Washington, D.C., on 3 March 1973 and entered into force on 1 July 1975. As of 4 September 2007, there are 171 States parties to CITES (one of the conservation agreements with largest membership), of which 137 states are WTO Members.[49] The key objective of CITES is to ensure that no species of wild fauna or flora becomes or remains subject to unsustainable exploitation due to international trade. It regulates the import and export of certain species of animals and plants allowing for punitive trade restrictions to be imposed on non-complying parties.
A potential area of tension between CITES and WTO rules is the practice of using trade measures to ensure compliance with the Convention. The Convention allows for a temporary suspension of commercial trade in CITES-listed species with specific parties that fail to demonstrate within a certain period of time that they have adopted adequate legislation for implementation of the Convention. Although there is no specific provision in the Convention on ‘non-compliance’, Article XIII on International Measures provides for cooperative procedures and institutional mechanisms for dealing with possible non-compliance. Additional CITES measures to ensure compliance derive from a set of procedures approved by the Conference of Parties (COP) over a number of years.[50]
A distinctive feature of CITES is Article XIV, entitled “Effect on Domestic Legislation and International Conventions”. Paragraph 2 of the Article provides that: “The provisions of the present Convention shall in no way affect the provisions of any domestic measures or the obligations of Parties deriving from any treaty, convention, or international agreement relating to other aspects of trade, taking, possession or transport of specimens which is in force or subsequently may enter into force for any Party including any measure pertaining to the customs, public health, veterinary or plant quarantine fields.”[51] This can be seen as a ‘conflict clause’ that may help in determining the issue of conflicting obligations.
The Basel Convention regulates international trade in hazardous waste. It was adopted at Basel on 22 March 1989 and entered into force on 5 May 1992. At the time of writing, there are 169 States parties to the Convention, of which 135 States are WTO Members.[53] The Convention initially confined the regulations of international trade in hazardous waste to a “prior informed consent” (PIC) approach. Subsequently, the third Conference of Parties (COP) adopted the so-called Ban Amendment that revises the original PIC approach. According to the Ban Amendment (which is not yet in force), all international shipments of hazardous waste for final disposal and reuse are banned from Annex VII countries (i.e. members of the OECD and EC, and Liechtenstein) to all other countries. The Convention contains some trade measures that might be considered special trade obligations (STOs).[54]
The Compliance Mechanism, adopted at COP6 in December 2002, promotes the identification, as early as possible, of implementation and compliance difficulties encountered by Parties. Such difficulties may relate to dealing with illegal traffic, or meeting reporting obligations. The mechanism is non-confrontational and preventive in nature, and seeks to assist Parties in implementing appropriate and effective solutions. A ‘Compliance Committee’ consisting of 15 members states drawn in equal numbers from the five regional groups of the UN was established to administer this mechanism.[55]
The Basel Convention contains a dispute settlement mechanism that is rather similar to that of the 1982 United Nations Convention on the Law of the Sea (UNCLOS) . According to Article 20 of the Convention, states parties are required to seek a settlement of disputes by negotiation or any other peaceful means of their choice. If they so agree, they can submit the dispute to the International Court of Justice for arbitration. States parties may declare that they accept compulsory jurisdiction of the ICJ or arbitration established under Annex VI.[56]
The crucial question that arises is whether trade measures under a multilateral environmental agreement are compatible with WTO rules. For example, an MEA could authorize trade in a specific product between its parties, yet ban trade in the same product with countries that have not signed the agreement. This could be found to be incompatible with WTO’s non-discrimination principle known as “most-favoured-nation treatment”, which requires countries to grant equivalent treatment regarding same (or “like”) products imported from any WTO member country.
No formal dispute involving a measure under a multilateral environmental agreement has so far been brought to the WTO. Yet what if MEA-related disputes are brought to the WTO system - should the WTO opine on the relationship between the WTO and MEAs? No WTO dispute resolution panel has yet addressed the conformity of any MEA trade restrictions with GATT rules. However, many MEA traded restrictions in one form or another have elements of discrimination between parties and non parties.
Many interesting proposals have been put forward in order to reconcile the WTO rules with MEAs. There appear to be four basic ways of addressing the issue. The first possible solution is to apply the “waiver” provision of the WTO Agreement. MEAs could be examined on a case-by-case basis under Article IX:3 of the WTO Agreement, which allows the waiver of any obligation in “exceptional circumstances.”[57] This solution seems unsatisfactory for several reasons: (1) The meaning of “exceptional circumstances” is rather vague; (2) approval under the waiver provision would be a political decision rather than one based on the substance of the case; and (3) the status of MEAs, which often take years to negotiate, would be in doubt until they enjoy the privilege of waiver.[58]
A second possible solution is to follow the approach of The North American Free Trade Agreement (NAFTA), which provides that certain MEAs (such as the Montreal Protocol, CITES and the Basel Convention) take precedence over NAFTA obligations.[59] This procedure clarifies the status of certain MEAs but does not provide for the approval of future MEAs. Furthermore, an ad hoc approach such as this may be workable for an organization of three states but would not be possible for the 151 member WTO.
A third alternative is to amend GATT Article XX itself. We have seen earlier that the Article was drafted at a time when environmental protection was not regarded as a crucial issue. The drafters, therefore, gave little thought to the protection of the environment. Recently however the situation has dramatically changed and protection of the environment has become an important issue for most countries in the world, a fact that can clearly be seen from almost universal participation in major MEAs. It seems advisable to amend Article XX to add the more comprehensive phrase ‘necessary to protect the environment’ in replacement of the phrase “necessary to protect human, animal or plant life or health”, and by adding a separate exception for MEAs. However, to amend the GATT itself is obviously a tedious task because it would require further prolonged negotiations.
The fourth alternative is to adopt a collective interpretation of Article XX that would validate existing MEAs and set out criteria for future ones. In accordance with Article IX: 2 of the WTO Agreement, the Ministerial Conference has “the authority to adopt interpretations of this Agreement and of the Multilateral Trade Agreements….The decision to adopt an interpretation shall be taken by a three-fourths majority of the Members.”[60] However, an interesting question is whether it is necessary for the Ministerial Conference to interpret Article XX while the Appellate Body is trying its best to consolidate its jurisprudence in relation to the meaning of the article.
Since the World Trade Organization is a subject of international law with the members being primarily sovereign States, the law of the WTO is nothing but international law, albeit a special type. What are the sources of the WTO legal system? What is the law that the WTO Dispute Settlement Body should apply? The sources of international law as laid down in Article 38(1) of the Statute of the International Court of Justice can generally be applied mutatis mutandis in the case of the WTO.
WTO agreements or covered agreements are the fundamental source of law: All the multilateral trade agreements annexed to the Agreement Establishing the WTO are known as the ‘WTO agreements’ or ‘covered agreements’. The WTO Agreement and all the agreements annexed to it (covered agreements) are “particular international conventions establishing rules expressly recognized by the contesting parties”[61]
within the meaning of Article 38(1) (a) of the Statute of the International Court of Justice. The fundamental source of law in the WTO is, therefore, the texts of the relevant covered agreements themselves. All legal analysis begins there.
As far as interpretation of the WTO agreements is concerned, Article 3: 2 of the Dispute Settlement Understanding (DSU) specifies that the dispute settlement system of the WTO is to clarify these agreements “in accordance with customary rules of interpretation of public international law”[62]. Customary rules of treaty interpretation are codified in Articles 31 of the 1969 Vienna Convention on the Law of Treaties (Vienna Convention). Which provides: “a treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose”.[63]
Customary international law: Customary international law plays a specific role in WTO dispute settlement by virtue of Article 3:2 of the DSU. These customary rules of interpretation are, so far, the only portions of customary international law which have been taken as part and parcel in the law of the WTO.[64] The WTO, like the GATT before it, is grounded in agreement, not in custom, therefore questions of custom are extremely rare.
Reports of prior panels and Appellate Body: By virtue of Article 38:1(d) of the Statute of the ICJ (read together with Article 59), in principle, the ICJ is not required to follow the examples of its prior decisions. The same system is applied in the WTO in respect to the reports of GATT panels as well as WTO panels and those of the WTO Appellate Body.
Other international agreements: Other international agreements may become sources of WTO law either because they are referred to specifically in the covered agreements or because the parties to a WTO dispute are also parties to another agreement. The texts of several covered agreements explicitly refer to other international agreements and by this measure these international agreements may become direct sources of WTO law in dispute settlement proceedings. The examples include international conventions such as the 1967 Paris Convention, and the 1971 Berne Convention as provided by the Agreement on TRIPS. Again, since the WTO agreements are treaties, it goes without saying that the relevant provisions of the Vienna Convention may also apply in WTO proceedings.[65]
Many WTO members are parties to many other international regulatory agreements that address economic, environmental, and social problems. A question may arise as to the extent that these agreements affect the rights and obligations of WTO members in relation to other WTO members. This has never directly occurred so far, although the issue was raised in the EC-Hormones case[66] where the relevance of the ‘precautionary principle’ was argued by the EC. The case involved a conflict between WTO law and an alleged rule of customary international law. If such a conflict should arise in the future between the WTO Agreements and other rules of international law, be they conventional or customary, WTO dispute settlement bodies will have to consider recognised rules under public international law to settle the conflict.
In recent years, the increase in both the number of treaties and the number of State parties to these treaties has given rise to the crucial issue of conflicting obligations under these treaties. Therefore, when drafting a new treaty, it is preferable to include express provisions as to its relationship with other treaties (including future treaties). Such a provision is called a ‘conflict clause’ by the International Law Commission.[67] As prevention is better than a cure, in practice, a number of multilateral treaties contain such a conflict clause governing their relationship with earlier or later treaties, or both. A popular provision of this kind is that “the treaty prevails over all other treaties, past and future”. An example of this is Article 103 of the United Nations Charter.[68] Some treaties provide that “the parties shall not enter into later inconsistent treaties”.[69] UNCLOS spells out clearly and precisely its relationship with other treaties and Article 311(1) states that “this Convention shall prevail, as between the States Parties, over the Geneva Conventions on the Law of the Sea of 29 April 1958”.[70]
If no such conflict clause is included in the treaty, and a conflict arises between treaties ‘on the same subject matter’, one must rely on the rules set out in Article 30 of the Vienna Convention, which codified customary international law. Article 30 applies to inconsistent treaties apart from the UN Charter.[71]
If parties are identical: The maxim Lex posterior derogat legi priori applies. There should not be any problem if parties to both treaties are identical. If the earlier treaty is not considered as terminated or suspended in accordance with Article 59, it applies only to the extent that its terms are compatible with those of the later treaty. This means, therefore, that the later treaty prevails over the earlier treaty.[72]
If parties are not identical: In this situation, Art. 30 (4)(b) applies, which is in effect based on the rule pacta tertiis nec necent nec prosunt. Therefore, as between a State party to both treaties and a State party to only one of the treaties, the treaty to which both States are parties governs their mutual rights and obligations.
Consequences of concluding treaties inconsistent with prior treaty obligations: In fact, a treaty lays down binding rules of conduct on the parties, who owe a duty to each other to refrain from acts inconsistent with their treaty obligations. This includes the duty not to sign with third States treaties inconsistent with the obligations of their existing treaties. If such an inconsistent treaty is concluded, the existing treaty nevertheless continues to apply to the relations of the parties and is in no way amended by the provisions of the later treaty.[73]
Then what are the consequences of ratifying such a later treaty? Suppose that State A has a prior treaty with State B. Later, State A enters into a treaty with State C, obligations under which are inconsistent with those under the earlier treaty.[74] The following appears to be the consequences:
(i) State A’s act may amount to a denunciation of the prior treaty;[75]
(ii) State A may be responsible under international law by virtue of being in breach of its obligations under the earlier treaty;[76]
(iii) State B may as a result of State A’s act, acquire a right to terminate or suspend the operation of the earlier treaty.[77]
However, in certain cases, the two conflicting norms may not be on the same subject matter. They may be on different subjects and could still result in conflicting obligations between the two. The conflict of obligations between the WTO Agreements and MEAs or human rights treaties provides a good example. The maxim lex posterior derogat legi priori alone may not be adequate and the solution could be found in the three fundamental principles, namely:
(i) lex posterior derogat legi priori (a later law repeals an earlier law);[78]
(ii) lex specialis derogat legi generalis (A special law prevails over a general law); and
(iii) Lex posterior generalis non derogat legi priori specialis (a later law, general in nature, does not repeal an earlier law which is more special in nature).[79]
The final and most pertinent issue would be which law will take priority: the WTO rule or the relevant environmental rule? What is clear is that we cannot just assume that the WTO rules take priority in all circumstances.
Both trade and environment are crucial for the well being of human society. What is most important is to strike a proper balance between free trade and environmental protection. There are a large number of multilateral environmental agreements. Although special trade obligations (STOs) can be found in only a minority, these MEAs usually incorporate environmental norms that may result in clashes with trade norms of the WTO. How is it best, therefore, to reconcile them? The following are suggested as possible models for achieving reconciliation:
(i) Reconciliation can only be possible with good faith negotiations under the Doha Development Agenda with renewed vigour and full commitments from both trade and environment advocates.
(ii) Since both the WTO Agreements and MEAs are international treaties, they are subject to the interpretative rules of the law treaties. Should a dispute involving a clash between the WTO rules and MEAs arise, a crucial question that needs to be tackled first is the selection of the forum: whether the appropriate forum is the dispute settlement body of the WTO or that of the relevant MEA.
(ii) In the event of any future conflict between the WTO rules and MEAs, trade advocates cannot simply argue that the WTO Agreements take priority and thus prevail over any other conflicting international treaties because the environmental side has the ability to argue the same. The best way to avoid such a situation is to include a ‘conflict clause’ or at least to contain cross-references in both types of Agreements.
[*] LL.B. (Yangon), LL.M. in International Law (Yangon), Ph.D. (IIUM), Professor of Law and Member of the WTO and Globalization Unit of the International Islamic University Malaysia. This is a revised and updated version of a research paper presented at the Asia WTO Research Network Regional Conference, “Trade, WTO and Sustainable Development: A Cause for Concern?” held on 23-24 April 2007 at Seri Pacific Hotel, Kuala Lumpur, Malaysia.
[**] LL.B (UM), LL.M (London), DSLP (IIUM), Ph.D (Aberdeen), Professor of Law and Member of the WTO and Globalization Unit of the International Islamic University Malaysia.
[1] The 1994 Ministerial Decision on Trade and Environment created the Committee on Trade and Environment (CTE), which is open to the entire WTO membership, with some international organizations as observers. The committee’s mandate is broad, and it has contributed to identifying and understanding the relationship between trade and the environment in order to promote sustainable development.
[2] United States - Restrictions on Imports of Tuna, DS 29/R, 16 June 1994, (1994) 33 ILM, 839.
[3] B M Hoekman and M M Kostecki, The Political Economy of World Trading System: WTO and Beyond (2001) 441, 441.
[4] United Nations Conference on Environment and Development (UNCED), Rio de Janeiro, 3-14 June 1992
[5] Rio Declaration on Environment and Development, A/CONF.151/26 (Vol. 1), 12 August 1992. Principle 12 of the Rio Declaration reads: “States should cooperate to promote a supportive and open international economic system that would lead to economic growth and sustainable development in all countries, to better address the problems of environmental degradation. Trade policy measures for environmental purposes should not constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on international trade. Unilateral actions to deal with environmental challenges outside the jurisdiction of the importing country should be avoided. Environmental measures addressing transboundary or global environmental problems should, as far as possible, be based on an international consensus.”
[6] ‘Preamble’ to the Agreement Establishing the World Trade Organization, opened for signature 15 April 1994, 1867 UNTS 187, (entered into force 1 January 1995) <http://www.wto.org/english/docs-e/legal-e/04-wto.pdf> at 30 November 2007 (hereinafter referred to as the ‘WTO Agreement’).
[7] Doha Ministerial Declaration, art. 6, WT/MIN (01) DEC/W/1 (14 November 2001).
[8] Ibid, art. 31. These negotiations focus on how WTO rules are to apply to WTO members that are parties to environmental agreements, in particular to clarify the relationship between certain trade measures taken under the environmental agreements, and WTO rules.
[9] ‘Is the WTO the Only Way?: Safeguarding MEAs from International Trade Rules and Settling Trade and Environmental Disputes Outside the WTO’, Briefing Paper, Adelphi Consult, Friends of the Earth Europe and Greenpeace, (2005), 3.
[10] See WTO Agreement, above n. 6, arts II (Scope) and III (Functions).
[11] See Ibid, ‘Preamble’.
[12] See for example, General Agreement on Tariffs and Trade 1994 (hereinafter ‘GATT 1994’) art. XX; General Agreement on Trade in Services (hereinafter ‘GATS’), art. XIV.
[13] GATS art II: 1 provides: ‘With respect to any measure covered by this Agreement, each Member shall accord immediately and unconditionally to services and service suppliers of any other Member treatment no less favourable than that it accords to like services and service suppliers of any other country.’
[14] TRIPS art 4 provides: ‘With regard to the protection of intellectual property, any advantage, favour, privilege or immunity granted by a Member to the nationals of any other country shall be accorded immediately and unconditionally to the nationals of all other Members… .’
[15] GATT 1994, art I: 1.
[16] GATS art XVII, and TRIPS art 3.
[17] GATT 1994 art III: 4.
[18] Ibid art XI: 1.
[19] Ibid., art. XX.
[20] WTO Analytical Index: Guide to WTO Law and Practice, GATT 1994, Art. XX, see also United States - Standards for Reformulated and Conventional Gasoline, Appellate Body Report, WT/DS 2/AB/R (29 April 1996), 25.
[21] United States - Standards for Reformulated and Conventional Gasoline, Panel Report, WT/DS 2/R (29 January 1996); Appellate Body Report, WT/DS 2/AB/R (29 April 1996).
[22] United States – Standards for Reformulated and Conventional Gasoline, Appellate Body Report, 35 ILM 603 (1996), at 25.
[23] Environmental Disputes in GATT/WTO, <http://www.wto.org/English/tratop-e/envir-e/e-dis00-e.htm> at 4 September 2007.
[24] The “Tuna-Dolphin” case was brought by Mexico against the United States under the old GATT dispute settlement procedure. See <http://www.wto.org/English/tratop-e/envir-e/e-dis00-e.htm> at 5 September 2007.
[25] United States - Restrictions on Imports of Tuna, GATT B.I.S.D. (39th. Supp.) at 155 (1993) (hereinafter ‘Tuna Dolphin I’).
[26] Among the most vocal commentators has been, on the environmentalist side, Steve Charnovitz, and on the trade side, Jagdish Bhagwati. See, for example, Steve Charnovitz, ‘Free Trade, Fair Trade, Green Trade: Defogging the Debate’ (1994) 27 Cornell International Law Journal 459, 461; Jagdish Bhagwati, ‘Trade and Environment: The False Conflict’ in D. Zaelke et. al. (eds.), Trade and Environment: Law Economic and Policy (1993) 159.
[27] The Marine Mammal Protection Act (MMPA), October 21 1972, 16, USC Chapt. 31 <http://www.nmfs.noaa.gov/pr/laws/mmpa/pdf > at 23rd. Feb. 2008.
[28] United States - Restrictions on Imports of Tuna, DS 29/R, 16 June 1994, (1994) 33 ILM, 839 (unadopted) (hereinafter ‘Tuna Dolphin II’).
[29] United States – Import Prohibition of Certain Shrimp and Shrimp Products, Panel Report, WT/DS 58/R (15 May 1998); Appellate Body Report, WT/DS58/AB/R (12 October 1998).
[30] United States - Import Prohibition of Certain Shrimp and Shrimp Products, Appellate Body Report, WT/DS58/AB/R (Oct. 12, 1998), 185.
[31] Ibid., 172, 175, 186.
[32] Convention on International Trade in Endangered Species of Wild Fauna and Flora, opened for signature 3 March 1973, 993 UNTS 243 (entered into force 1 July 1975) (hereinafter ‘CITES’) <http://www.cites.org/eng/disc/text.shtml> at 6 September 2007.
[33] See Amicus Brief to WTO: Shrimp-Turtle Dispute (September 1997), at <http://www.field.org.uk/files/shrimpbrief.pdf> at 6 September 2007.
[34] European Communities – Measures Affecting Asbestos and Asbestos-Containing Products, Panel Report (18 Sept. 2000), WT/DS 135/R; Appellate Body Report (12 March 2001), WT/DS 135/AB/R.
[35] United States - Standards for Reformulated and Conventional Gasoline, Panel Report, WT/DS 2/R (29 January 1996); Appellate Body Report, WT/DS 2/AB/R (29 April 1996); Brazil’s case (DS 4) was decided by the same Panel.
[36] European Communities – Measures Affecting the Approval and Marketing of Biotech Products, Panel Report, WT/Ds 291/R (US), WT/DS 292/R (Canada), WT/DS 293/R (Argentina), (29 September 2006).
[37] The proclamation of the ‘precautionary principle’ can be considered one of the most important provisions in the Rio Declaration. Principle 15 provides: “In order to protect the environment, the precautionary principle shall be widely applied by States according to their capabilities…” For the text of the Rio Declaration on Environment and Development, see Report of the United Nations Conference on Environment and Development, Rio de Janeiro, 3-14 June 1992, A/ CONF.151/26 (Vol. 1).
[38] See ‘EC Decides Not to Appeal WTO Biotech Ruling’, Trade Biores Main Page, 6 (21), 1 December 2006, <http://www.ictsf.org/biores/06-12-01/story4htm> at 3 September 2007.
[39] Brazil – Measures Affecting Imports of Retreaded Tyres, WTO, DS 332.
[40] Brazil – Measures Affecting Imports of Retreaded Tyres, Panel Report, WT/DS 332/R, 12 June 2007. On 10 August 2007, at the joint request of Brazil and the EC (WT/DS332/8), the DSB agreed to extend the deadline for the adoption or appeal of the panel report. In the joint request, the EC said it would appeal the panel report on 3 September 2007. Brazil declared the findings of the panel were satisfactory and it would not appeal the report. ‘DSB agreed to extend the timeline for the adoption or appeal of the Panel report on retreaded tyres; Brazil Calls WTO Ruling in Retreaded Tyres Dispute “Favourable”’, WTO News Item 2007, <http://www.wto.org/English/news_e/news07_e/dsb_10aug07_e.htm> at 5 September 2007.
[41] Mitsuo Matsushita, Thomas J Schoenbaum, and Petros C Mavroidis, The World Trade Organization: Law, Practice and Policy (2003) 456.
[42] Montreal Protocol on Substances that Deplete the Ozone Layer, opened for signature 16 September 1987, 1522 UNTS 3 (entered into force 1 January 1989) (hereinafter ‘Montreal Protocol’)<http://www.globelaw.com/Climate/montreal.htm> at 6 September 2007. The Protocol has four amending instruments: the London Amendment of 1990, the Copenhagen Amendment of 1992, the Montreal Amendment of 1997 and the Beijing Amendment of 1999.
[43] See http://ozone.unep.org/Ratification_status/> at 6 September 2007.
[44] See Matrix on Trade Measures Pursuant to Selected MEAs, prepared by the WTO Secretariat, available at <http://www.docsonline.wto.org> at 6 September 2007.
[45] See Montreal Protocol, art 4.
[46] See Annex II of the Report of the 10th Meeting of the Parties. Source: Handbook for the Montreal Protocol on Substances that Deplete the Ozone Layer (Ozone Secretariat, UNEP, 7th ed, 2006).
[47] ‘Indicative List of Measures That Might be Taken by a Meeting of the Parties in Respect of Non-Compliance with the Protocol’, Annex V of the Report of the Fourth Meeting of the Parties. Source, ibid.
[48] CITES, above n 32.
[49] See Matrix on Trade Measures Pursuant to Selected MEAs, above n 42.
[50] Decision 11.15 of COP XI in April 2000, for example, stated that four states parties (Fiji, Turkey, Vietnam and Yemen) had high volumes of international trade in CITES-listed species and that their national legislation did not meet the implementation requirements of CITES. They were given 1 year for compliance. Upon failure, Decision 11.16 of COP XI asked all Parties to suspend trade in all CITES-listed species with the four countries in question.
[51] CITES, above n. 32, art. XIV, para. 2.
[52] The Basel Convention on the Control of Trans-boundary Movements of Hazardous Wastes and Their Disposal, 1989, opened for signature 22 March 1989, 1673 UNTS 57 (entered into force 5 May 1992) (hereinafter ‘Basel Convention’).
[53] See Matrix on Trade Measures Pursuant to Selected MEAs, above n 38.
[54] See Basel Convention arts 4, 6, 8, 9 and 13.
[55] See <http://www.basel.int/convention/basics.html> at 9 September 2007.
[56] Basel Convention, above n. 52, art 20.
[57] WTO Agreement, above n. 6, art IX: 3 provides: ‘In exceptional circumstances, the Ministerial Conference may decide to waive an obligation imposed on a Member by this Agreement or any of the Multilateral Trade Agreements, provided that any such decision shall be taken by three fourths of the Members… .’
[58] For criticism against the waiver approach, see Steve Charnovitz, ‘GATT and the Environment’, (1992) 4 International Economic Affairs 41.
[59] North Atlantic Free Trade Agreement, opened for signature 17 December 1992, (Canada, Mexico, and US), 32 ILM 296 & 605, art 104, para. 1 (entered into force 1 January 1994).
[60] WTO Agreement, above n. 6, art. IX: 2.
[61] The Statute of the International Court of Justice, 26th. June 1945, http://www.icj-cij.org/documents/index.php, art. 38(1)(a).
[62] Understanding on Rules and Procedures Governing the Settlement of Disputes, Annex 2, WTO Agreements, above n. 6, art. 3: 2.
[63] For a detailed study of interpretation of treaties, see Abdul Ghafur Hamid & Khin Maung Sein, Public International Law: A Practical Approach, (2nd ed, 2007) 231-238.
[64] The issue of custom did arise in one important WTO proceeding. It relates to the question of whether ‘precautionary principle’ is part of customary international law. See Panel Report, EC - Hormones, Complaint by the US, para 8.157.
[65] The reference in art 3.2 of the DSU to the ‘customary rules of interpretation of public international law’ has been held by the Appellate Body to refer to arts 31 and 32 of the Vienna Convention on the Law of Treaties, opened for signature 23 May 1969, 1155 UNTS 331 (entered into force 27 January 1980)(hereinafter ‘Vienna Convention’). Other provisions of the Vienna Convention which may be law in WTO proceedings include art 26 (Pacta sunt servanda), art 28 (non-retroactivity of treaties), and art 30 (application of successive treaties relating to the same subject matter).
[66] European Communities--Measures Concerning Meat and Meat Products (Hormones), WTO Doc. WT/DS26/AB/R, WT/DS48/AB/R (16 Jan 1998).
[67] See Yearbook of the International Law Commission, (1996) vol. II, 214.
[68] Article 103 of the UN Charter, commonly known as the ‘clause paramount,’ provides: ‘In the event of a conflict between the obligations of the Members of the United Nations under the present Charter and their obligations under any other international agreement, their obligations under the present Charter shall prevail.’
[69] See e g, art 8 of the North Atlantic Treaty 1949.
[70] The United Nations Convention on the Law of the Sea, signed at Montego Bay, Jamaica, 10th December 1982, entered into force 16th November 1994, at www.un.org/Depts/los/convention
_agreements/texts/unclos, art. 311(1).
[71] Article 30 of the Vienna Convention is subject to art 103 of the UN Charter, which provides that ‘In the event of a conflict between the obligations of the Members of the United Nations under the present Charter and their obligations under any other international agreement, their obligations under the present Charter shall prevail.’
[72] Vienna Convention art 30 (3). In determining which treaty is the earlier and which the later, the relevant date is the date of adoption, not entry into force. See Vierdag, ‘The Time of the Conclusion of a Multilateral Treaty: Article 30’, (1988) 59 BYIL 75, 90-111.
[73] Vienna Convention art 30 (4)(b).
[74] Aust is of the view that State A will have to seek to amend or terminate one or other of the treaties or risk being in breach of one of them. See A AUST, Modern Treaty Law and Practice (2000) 174.
[75] See Vienna Convention art 56 for denunciation of a treaty.
[76] It will be a question of construction in each case whether state A would be in a breach of its obligations by virtue of the mere conclusion of the inconsistent treaty, or only by virtue of some action subsequently taken pursuant to it. See Vienna Convention art 30(5).
[77] See Vienna convention art 30(5) and also arts 41 and 60.
[78] M E Villiger, Customary International Law and Treaties (1985), 36.
[79] See the comment of AGO, Yearbook of the International Law Commission (1966), Vol. 1, Part 2, 167, para 50.
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