TRADE AND ENVIRONMENT: SUSTAINABLE DEVELOPMENT AS PRINCIPLE OF INTERNATIONAL LAW (By- Aishwarya Singh)
TRADE AND ENVIRONMENT: SUSTAINABLE
DEVELOPMENT AS PRINCIPLE OF INTERNATIONAL LAW
Authored by- Aishwarya Singh
Abstract
The free trade policy is designed to
allow markets to utilize resources for their efficient use, while environmental
policy seeks to manage and conserve the earth's resources efficiently.
Conflicts can also arise when similar resources are subjected to shared
marketing efforts as well as natural management and management efforts. Global
environmental problems require global solutions on a multi-national basis.
Therefore, any national effort to address these issues without a network of
international institutional support tools and principles may not work. The UN
is the only international organization with a global membership and is global
in scope. It can better assist governments in their environmental protection
programs due to its multi-sectoral capabilities and comprehensive knowledge
that includes all stakeholders in the trade and environmental system.
In the context of the WTO, the
solution can take the kind of harmonization required by environmental standards
in all countries, which can be encouraged or strengthened by allowing
high-quality countries to use anti-dumping activities abroad whose lower costs
are partly due to the weak environmental protection.
Keywords: Trade,
environmental protection, sustainable development, United Nations, Global
membership
Introduction
What are the initiatives made by the
World Trade Organisation to safeguard the environment? What are its objectives
and the role it plays? There are a number of environmental groups and
green-learning governments whose aim is to balance the bean of trade and the
environment. These groups came to view and coordinate with WTO to achieve the
respective required objectives within a rule-based international regime. The
proponents of expanded global trade are the policymakers in developing
countries, who are doubtful about the expanded role of maintaining
environmental standards in WTO.[1] The
inter-relationship between trade and the environment can be recognised in the
preambular language under the World Trade Organisation Agreement.[2] It
follows:
“[The
WTO Members'] relations in the field of trade and economic endeavor should be
conducted with a view to ... allowing 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.”
This broad objective provided in the
Preamble of the WTO Agreement reflects substantial development that
incorporates environmental aspects in the newly institutionalized international
economic organization. This could not have been predicted even in the Draft
Final Act that embodies the results of the Uruguay Round of Multilateral Trade
Negotiations.
Statement Of Problem
The sectoral and fragmented
development of institutions to address these global problems could not keep
pace with economic and environmental growth. The problems in the trading
interface with the environment; impossible and unintended have done extensive
research on all relevant issues as part of this interface. There is an
inconsistency between the problems that arise from connection the nature of the
global ecosystem, and its solutions, which are required by the framework of a
geopolitical system based on an independent State.
Research Questions
- Whether there is a fundamental
conflict between trade liberty and, concern for global environment?
- What changes in laws and
policies, from the GATT to the WTO, regarding trade and the environment?
- How these changes will affect
procedures, laws and decision-making processes within the WTO?
- What are the factors
contributing to these changes - trade, sustainable development, and
environmental concerns?
Objectives Of The Research
- To enhance the capacity and
capabilities of the member countries that implement trade policies to
promote trade and environmental sustainability along with human well-being
- To strengthen the sustainability
across and cross-border trade. To focus on investment agreements in
bilateral and multilateral trade negotiations.
- To promote trade and environment
consistent with the trade and environmental policies with relevant
principles and concepts in order to make policies mutually supportive of
sustainable development.
- To assist and direct countries
about trade opportunities that arise from the transition to greener
economies.
- To encourage trade practice and
maximize national income, with estimating the cost of recovering
environmental damage or benefit of environmental cleanup.
- To make member states realize
the shift in trade practices to trend sustainable development patterns.
Scope Of The Research
This research work is a virtual
trade-environment interface. covers the broad fabric and covers a multitude of
problems. Considering the size of the work being done, it would be good to
initially describe the scope of this study. The research focuses on law
problems in the trading interface with the environment; impossible and
unintended have done extensive research on all relevant issues as part of this
visual.
This study analyzes the official
international and environmental trade focusing on areas of collaboration, that
is, part of the environment international trade regime and trading provisions
contained in Multilateral Environmental Conventions (MEAs). Criminal law finds
an important place in this study and trade disputes related to the environment
are considered in detail. Analysis of development in an environmentally
friendly environment at the regional level provides a is the background of
comparison.
This research work has
tried to appropriate the role of WTO in environment protection at the global
level. This work analyses the role that WTO has played vis-à-vis the protection
of the environment & to study the disputes WTO has handled between many
countries when it comes to the environment. It reflects substantial development
that incorporates environmental aspects in the newly institutionalized
international economic organization.
Methodology
The methodology opted for
research were-
- Qualitative
- Case
Study
- Analytical
research
- Fundamental research
Literature Review
- Environmental Issues in the World Trade Organization by
Chad P. Bown and Rachel McCulloch, (February 2003)
This paper sets the linkage between a
different trade agreement and the environment. It addresses the environmental
impacts of increased trade practices. It focuses on the fair interaction
between income levels and endogenous national environmental standards. The
crucial issue that has been raised is related to the ability of WTO rules to
curtail the ability of signatories to apply the required environmental
safeguards at the national level. This paper revolves around trade and
environment examining the role of the GATT and WTO with economic analysis and
empirical findings on the trade environment nexus.
This paper constructs the single
policy objective to maximize national welfare. It also includes the environmental
issues relating to the silent political considerations under income
distribution seen as tangentially related to trade.
- Trade and the Environment: Fundamental Issues in
International Law by LudivineTamiotti, WTO Law and Legal Theory By Erich
Vranes Oxford: Oxford University Press, 2009, 9 World Trade Review 285–288
(2010).
This paper discusses whether the
measure can be adapted under the World Trade Organisation for protecting the
environment under trade-related aspects subject to carefully crafted
conditions. It also provides briefing over three trade and environment cases
brought under WTO dispute settlement mechanism- The US-Gasoline, US-Shrimp, and
Brazil-Retreaded Tyres cases. These three cases assured the WTO members’
ability to adapt trade-environment measures that address several legal
interconnections between trade and the environment. There are several trades
and environmental legal issues being clarified in this literature, and
specifically dealing with the consequences of the extraterritorial domestic
environmental measures. Finally, I will also cover the three-dimensional
analytical framework of two major environmental issues- ozone and climate
protection.
- Environment and Trade as Partners in Sustainable
Development: A Commentary by Edith Brown Weiss, 86 American Journal of
International Law 728–735 (1992).
This paper is of the opinion that “Trade is not an end in itself; rather, it is
a means to an end.” There needs to be an end to environmentally sustainable
economic development. There are legitimate restrictions and limitations on
trading patterns and practices that ensure “instrument of trade” guides
environmental sustainable development. This paper also takes
care of the measures required to
protect the environment that shouldn’t adversely affect free trading relations.
- Trade, Environment, and Sustainable Development: A
Primer by Robert Housman &DurwoodZaelke, 15 Hastings INT'l& COMP.
L. REV. 535 (1992).
This paper focuses on free trade
policy and environmental policies. Free trade policy is structured to allow the
market and its members to allot resources to their most systematic and planned
use. Whereas, the environmental policy focuses and aims to maintain and manage
the earth’s resources efficiently.
This paper critically discusses the
conflict that arises where similar resources are a matter of concern for both
trades efforts to allocate and environmental efforts to maintain. Therefore,
there is a requirement of two separate trade and environment policies to limit
the conflict between them. Adding some philosophical and jurisprudential twist,
it relates to trade and environment communities with their professional
cultures. With economic principles as efficiency and comparative advantages,
guide trade environmental experts, who are informed more with biological
science and ecological principles.
- An Introduction to Sustainable Development by Elliott,
J. (4th ed.). Routledge (2012).
This paper adds emphasis on the
global challenges of sustainable development. Sustainable development with the
inter-linked crisis in different environmental issues- climate, energy,
economy, poverty, and social injustice. This paper helps me to interlink crises
with a deep questioning of what sustainable development actually is? What does
it actually justify and how sustainable development and policies can be
recognized? The paper provides a substantially expanded discussion of how
poverty and social lacuna lead to central sustainable development challenges as
provided through the Millennium Ecosystem Assessment and Millennium Development
Goals.
- Environmental Principles and Concepts, Organisation for Economic Co-operation
and Development (Paris 1995)
This paper discusses trade -
environmental principles and related concepts. Its main objective of the
discussion is to promote the consistency of the trade-environment principles
and concepts with the aim to make those policies and principles mutually supportive
of sustainable development.
- The United Nations' Approach to Trade, the Environment
and Sustainable Development by ShawkatAlam, 12 ILSA J. INT'l& COMP. L. 607 (2006).
This paper discusses the complex and
transboundary environmental issues that have turned into global issues. The
issues linking ecology, economics, and politics address the sectoral and
fragmented development of institutions. The issues arise out of the increasing
interdependence of the economy and ecology. Discusses the global environmental
issues that require global solutions.
The paper discusses the United
Nations and its exceptionally well-positioned address issues. The UN helps the
government with its environmental protection initiatives. This paper provides a
summary of emerging environmental concerns in the UN, and the manner in which
the UN members link their environmental concerns with international trade
issues. Further, it outlines the role and function of UN organizations
explicitly mentioned with respect to trade and environmental issues known to be
the UN Conference on the Human Environment.
General Agreement On Tariffs And
Trade
The Tuna-Dolphin case [3] was
between Mexico and the United States. This case began in 1991, when the Mexican
fishing fleets were in the process of killing an excessive amount of dolphins.
The United States imposed trade restrictions on Mexico over import of tuna.
Mexico filed the complaint with the General Agreement on Tariffs and Trade
against the restriction imposed from the Marine Mammal Protection Act of 1972.
The issue arose because of the unwanted death of dolphins. The school of
yellow-fin tuna swims under the school of dolphins, and at the time of fishing
many dolphins are caught with purse-seine nets and die unless released.[4] The GATT
panel ruled against the United States with the reasoning that the prohibitions
of imports of tuna from Mexico is irrational. Countries cannot ban or restrict
importation of products because the process of another country is not
compatible with the process preferred by the importing country.
The U.S. Standards for Gasoline case come to light when the United
States applied stricter rules on gasoline chemical characterised imports than
the domestically refined gasoline imports. The Venezuela filed complaint against
the United States to the Dispute settlement Body for imposing rules
discriminating against gasoline imports. The issue was in context of trade
discrimination –
Whether the US measures adapted
against gasoline import is discriminatory and favours domestic refineries.The
central question was about discrimination — whether the US measure
discriminated against imported gasoline and in favour of domestic refineries.
Venezuela argued that the United States imposed unfair trade restriction and it
violates the national treatment principle, which is not justified under
exceptions to normal WTO rules for health and environmental conservation
measures. The dispute panel favored and agreed with Venezuela and Brazil. The
panel stated that the WTO rules were discriminatory against gasoline and it
violates the trade rules.
The United States appealed. The
United States appealed. The appeal was upheld. The panel suggested making
certain changes, and the United States agreed with Venezuela that concluded
with an amendment in trade rules.[5]
In heShrimp-Turtle
case, United States impose an import ban on shrimp harvest. The manner the
shrimps were harvested, it could damage sea turtles. The import ban was
challenged by India, Malaysia, Philippines, Pakistan, and Thailand before the
panel established under World Trade Organisation. The countries argued that the
US policy violates the General Agreement on Tariffs and Trade (GATT 1994).
Provisions Within Trade Agreements
Relevant To Environmental Agreements And Concerns
The GATT looks after all trade among
nations and provides the adequate legal framework. The samples are - the
European Free Trade Association - regional, and United States-Canada Free Trade
Agreement - bilateral trade agreements that co-exist with the GATT.
The GATT and following trading
agreements seeks to provide a secure and predictable international trade
environment with higher economic efficiency and efficient trade liberalisation,
The GATT preamble recognizes “that... trade and economic endeavor should be
conducted with a view to raising standards of living,... developing the full
use of the resources of the world and expanding the production and exchange of
goods ....”[6]The
trade activities for advancement of economic structure have both positive and
negative consequences for the environment when examined and studied in the
theme of sustainable development.
Gatt
The GATT consists of three major
parts:
- Part I: Articles I to III -
comprises the most-favored-nation and tariff concession obligations;
- Part II: articles III to XXIII -
comprises the GATT's substantive provisions and the exceptions to its
obligations; and
- Part III: articles XXIX to
XXXVIII - comprises procedural mechanisms for implementing the other
obligations and provisions contained within the GATT.[7]
1. GATT's General Trade Principles And
Their Environmental Implications
a. The Most-Favored-Nation-Principle
Article I: under this
article, it provides that the most-favoured-nation principle (MFN) guarantees
the contracting parties not to discriminate among imported products because of
their national origin. The MFN mandates the contracting parties to extend any
privilege or advantages immediately irrespective of the “like product” to other
GATT contracting parties. This obligation applies to-
1. customs, duties, and charges related
to imports and exports;
2. the methods of levying all such
duties and charges;
3. rules, regulations, and procedures
connected with importation and exportation; and
4. internal taxes, charges, laws,
regulations, restrictions, and rules affecting the internal sale or offering
for sale, purchase, transportation, warehousing or storage, distribution, or
use of a product.[8]
2. The National Treatment Principle
Article III as used appears to
prevent the country from using taxes, levies, or other import restrictions to
protect the competitiveness of the domestic industry which incurs environmental
costs within its product costs. Foreign competitors whose product costs do not
reflect the environmental costs associated with the production of their
products may receive a competitive advantage over domestic products.
As the GATT Secretariat has noted:
“Production and consumption activities in other countries can also be a
source of domestic environmental concern. Pollution may be spilling over
borders and harming either the regional environment (acid rain) or the global
commons (ozone depletion). Or land development projects may be threatening the
extinction of an animal or plant species, and uncontrolled fishing may be
depleting fish stock in the high seas. It is not unreasonable that the
government of a country concerned by such practices would seek to see them
changed-and that it would find it difficult to accept that this would not be
possible.... In principle it is not possible under GATT's rules to make access
to one's own market dependent on the domestic environmental policies or
practices of the exporting country.”[9]
Article III as used appears to
prevent the country from using taxes, levies, or other import restrictions to
protect the competitiveness of the domestic industry which incurs environmental
costs within its product costs. Foreign competitors whose product costs do not
reflect the environmental costs associated with the production of their
products may receive a competitive advantage over domestic products.
The Un Conference On The Human
Environment
The UN Conference on the Human
Environment created held in and it led to the creation of the first subsidiary
body of the UN focusing on the protection of the environment.[10] This was
the United Nations Environment Program (hereinafter "UNEP").[11] Three
main topics provided the basis for the Stockholm conference: the planning and
management of human settlements; natural resources and aspects of development,
which could be seen to include developing countries; and the identification and
control of pollutants.'[12] The most
important instruments that emerged from the UNCHE are the various action plans,
and the "Stockholm Declaration.”[13]Trade
and environment issues emerged in that UNCHE in the context of competitiveness
concerns associated with the trade and environment interactions.[14]
- Right to Development
The Stockholm Declaration recognized
that “developing countries should focus their efforts
on development that takes into
account their priorities and the need to protect and develop the environment.”
countries and their own, and the process of industrial development and
technological development. In its objective, the Stockholm Declaration warned
of the negative impact of any natural action on the development prospects of
developing countries. It explicitly stated that “the natural policies of all
provinces must develop and not adversely affect current or future development.”
It also states that an agreement must be reached “to meet the possible national
and international consequences for the implementation of natural measures.”
- Finance and Technological Assistance
The Stockholm Declaration emphasized
the need to provide financial and technical assistance to developing countries
to address their own environmental problems. The situation of developing
countries in this context was marked by:
“Environmental shortages, caused by
underdeveloped conditions and natural disasters, cause serious problems and can
best be solved by rapid development through the transfer of large sums of
financial and technical assistance as an addition to the domestic effort of
developing countries.”
- Commodity Prices
Developing countries rely heavily on
exports for their profits. As a result, further declining commodity prices
could seriously undermine developing countries' ability to address sustainable
development issues. Principle 10 of the Stockholm Declaration recognizes. this
issue, and states that commodity price stability “is important for
environmental management. This is because, in order to develop sustainable
development strategies,” economic factors, and environmental pressures must be
taken into account.
- The Special Situation of Developing Countries
The special situation and needs of
developing countries in addition to international technical and financial
assistance have been recognized in Principle 12 of the Stockholm Declaration
which states that "resources should be made available taking into account
any costs which may emanate from their [incorporation of] environmental
safeguards into their development planning. However, trade-related
environmental measures and environment-related trade measures do not seem to
have emerged at that point in time.
- Assessment of UNCHE
UNCHE was the first comprehensive
effort to address environmental issues worldwide. Although this Declaration was
not binding on all nations, it was unanimously adopted by
the 113 nations making up the UN
General Assembly.[15] In fact,
the Stockholm Declaration "received widespread recognition and acceptance
in the international community because of the fundamental nature of the stated
values.[16]
Polluter Pays Principle
In the early 1970s, the polluter pays
principle was adopted, when there was a requirement for stricter environmental
regulations being introduced in OECD countries. The OECD governments were
pushed to help and cover the cost of complying with new regulations for
industries and also impose similar costs on imports. This similar cost on
imports should be made through compensatory import levies. The government and
member states had a widespread concern for both environmental subsidies and
environmental tariffs that caused severe issues due to trading systems or
patterns.
In 1972, the OECD Recommendation of
the Council was released on guiding Principles for International Economic
Aspects of Environmental Policies[17] that
includes recommendations as - 1. Not to subsidise the environmental costs of
industry, excluding exceptional cases,
2. Not to use trade remedies or
import duties to compensate for trading costs.
The EC Convention provides that the
principle that “pollutants must pay” is one of the cornerstones of public
policy on the environment. Also, Rule 16 of the Rio Declaration relating to the
inclusion of environmental costs internally refers to the Polluter Payment
Policy. The “Pollution PollutionPolicy”, which is a fundamental principle of
economic policy rather than the rule of law, states that a polluter must bear
the cost of taking steps to prevent pollution or compensate for the damage
caused by pollution. As outlined in the 1972 OECD Guiding Principles on the
International Economic Aspects of Environmental Policies, it reads: and the
investment is the so-called ‘Paymaster’. This policy means that the polluter
must bear the costs of implementing the above-mentioned measures by government
officials to ensure that the environment is in good condition. In other words,
the cost of these measures must be reflected in use. Such measures should not
be accompanied by funding that could cause serious disruption to international
trade and investment between government and private companies to pay for
domestic pollution or to protect their national property.
Conclusion
Trading is not the end in itself;
rather, it is a means to an end. The result is environmentally sustainable
economic development. So, when considered, there are formal barriers to trading
patterns and processes needed to ensure that the “trading tool” leads to the
sustainable development of the environment. Measures needed to protect the
environment cannot be sworn in because they could disrupt free trade relations.
This publication introduces a unique
legal relationship between trade and the environment in terms of three related
perspectives: (i) ‘horizontal’ relationships between WTO law and international
civil law, including treaty law as contained in international environmental
agreements; (ii) ‘direct’ communication between domestic measures that regulate
environmental protection, including their effects in other countries, and WTO
legislation; and (iii) the link between trade and the environment in the
context of relevant WTO rules and principles. With the rapid growth of world
trade and the acceleration of environmental degradation, both international
trade, and environmental law empires are growing rapidly - but until recently,
they have developed equally well tracks.
Reference
- Chad P. Bown and Rachel
McCulloch, Environmental Issues in the World Trade Organization, (2007),
(April 27, 2022, 11:10 AM), https://people.brandeis.edu/~cbown/papers/bown_mcculloch_kluwer.pdf.
- DukgeunAhn, Environmental
Disputes in the GATT/WTO: Before and After US-Shrimp Case, 20 MICH. J.
INT'L L. 819 (1999), (April 27, 2022, 12:07 PM),
https://repository.law.umich.edu/mjil/vol20/iss4/5.
- Tuna/Dolphin I, reprinted in 30
ILM 1594 (1991); Tuna/Dolphin II, reprinted in 33 ILM 839 (1994).
- Jonathan Wert, Tuna Dolphin
Case, (April 29, 2022; 09:25 PM),
https://www.bartleby.com/essay/Tuna-Dolphin-Case-PJTADEGFYBT.
- Venzuela, Brazil versus US:
gasoline, (April 29, 2022, 10:11 PM),
https://www.wto.org/english/tratop_e/envir_e/edis07_e.htm#gasolinerule
- General Agreement on Tariffs and
Trade, opened for signature Oct. 30, 1947, pmbl., 61 Stat. at A 11.
- JOHN H. JACKSON, THE WORLD
TRADING SYSTEM: LAW AND POLICY OF INTERNATIONAL ECONOMIC RELATIONS 40
(1989).
- GATT, supra note 7, art. 1, 61
Stat. at A12; see also Jeanne J.
Grimmett, Environmental Regulation and the GA7T, Aug. 1991, at 3-4 Cong.
Res. Service, No. 91-285-A (1991).
- GATT Secretariat, Trade and the
Environment, supra note I, at 8-10 (emphasis in the original).
- Patricia Bimie, Environmental
Protection and Development, 20 MELB. U. L. REv. 69-70, 81.
- Id. at 70, 81.
- Id. at 81.
- United Nations Conference on the
Human Environment, Stockholm, Sweden, June 5-16, 1972, U.N. Doc
A/CONF.48/14/Rev.I [hereinafter Stockholm Declaration].
- Charles S. Pearson, The Trade
and Environment Nexus: What is New Since '72?, in TRADE AND THE
ENVIRONMENT LAW, ECONOMICS, AND POLIcY 23, 24 (DurwoodZaelke et al. eds.,
1993).
- Principle 21 of the Stockholm
Declaration affirmed an existing international legal obligation which
reads as follows:
- Tony Simpson and Vanessa
Jackson, Human Rights and the Environment, ENV'T & PLAN. L.J. 268, 271
(1997).
- OECD (1972), Recommendation of the Council on Guiding Principles concerning International Economic Aspects of Environmental Policies [C(72)128].
[1] Chad P. Bown and Rachel McCulloch, Environmental
Issues in the World Trade Organization, (2007), (April27, 2022, 11:10 AM),
https://people.brandeis.edu/~cbown/papers/bown_mcculloch_kluwer.pdf.
[2]DukgeunAhn, Environmental Disputes in the GATT/WTO:
Before and After US-Shrimp Case, 20 MICH. J. INT'L L. 819 (1999), (April27,
2022, 12:07 PM), https://repository.law.umich.edu/mjil/vol20/iss4/5.
[3]Tuna/Dolphin I, reprinted in 30 ILM 1594 (1991);
Tuna/Dolphin II, reprinted in 33 ILM 839 (1994).
[4] Jonathan Wert, Tuna Dolphin Case, (April29, 2022;
09:25 PM), https://www.bartleby.com/essay/Tuna-Dolphin-Case-PJTADEGFYBT.
[5]Venzuela, Brazil versus US: gasoline, (April29, 2022,
10:11 PM), https://www.wto.org/english/tratop_e/envir_e/edis07_e.htm#gasolinerule
[6]General Agreement on Tariffs and Trade, opened for
signature Oct. 30, 1947, pmbl., 61 Stat. at A 11.
[7]John H. Jackson, The World Trading System: Law and Policy
of International Economic Relations 40 (1989).
[8]GATT, supra note 7, art. 1, 61 Stat. at A12; see also
Jeanne J. Grimmett, Environmental Regulation and the GA7T, Aug. 1991, at 3-4
Cong. Res. Service, No. 91-285-A (1991).
[9]GATT Secretariat, Trade and the Environment, supra
note I, at 8-10 (emphasis in the original).
[10] Patricia Bimie, Environmental Protection and
Development, 20 MELB. U. L. REv. 69-70, 81.
[11]Id. at 70, 81.
[12] Id. at 81.
[13] United Nations Conference on the Human Environment,
Stockholm, Sweden, June 5-16, 1972, U.N. Doc A/CONF.48/14/Rev.I [hereinafter
Stockholm Declaration].
[14]Charles S. Pearson, The Trade and Environment Nexus:
What is New Since '72?, in TRADE AND THE ENVIRONMENT LAW, ECONOMICS, AND POLIcY
23, 24 (DurwoodZaelke et al. eds., 1993).
[15] Principle 21 of the Stockholm Declaration affirmed an
existing international legal obligation which reads as follows:
[16]Tony Simpson and Vanessa Jackson, Human Rights and the
Environment, ENV'T & PLAN. L.J. 268, 271 (1997).
[17]OECD (1972), Recommendation of the Council on Guiding
Principles concerning International Economic Aspects of Environmental Policies
[C(72)128].