Trade Measures to Address Environmental Concerns in Faraway Places: Jurisdictional Issues

• Published date: 01 November 2014
• DOI: http://doi.org/10.1111/reel.12096
• Author: Margaret A. Young
• Date: 01 November 2014

Trade Measures to Address Environmental

Concerns in Faraway Places: Jurisdictional Issues

Margaret A. Young

States sometimes restrict imports to address environ-

mental concerns that arise from conduct outside of

their territory: common examples include deforesta-

tion in foreign places or illegal fishing in the high seas.

Apart from the need to comply with the agreements of

the World Trade Organization (WTO), the adoption of

such trade measures gives rise to two jurisdictional

issues: first, the importing State might be alleged to be

engaging in extraterritorial jurisdiction; and second,

the importing State may affect the economic interests

of indigenous communities. This article analyzes WTO

jurisprudence and other international instruments. It

shows that jurisdictional issues are underpinned by

sovereignty – of the importing State, the exporting

State and even other groups. If there is a need for a

nexus between the importing State and the relevant

product or measure in order to fall within any juris-

dictional limitations of the WTO agreements (which

remains uncertain), it will be more easily satisfied if

environmental problems impact upon the ‘public

morals’ of citizens or consumers, as was found in the

recent challenge to the European Union’s ban on seal

products. However, the complex needs and interests of

other States must also be considered, especially if the

trade measures impact on the interests of indigenous

peoples, and on the established or emerging legal

arrangements between indigenous peoples and

domestic governments. The design and application of

trade measures to address environmental concerns

requires flexibility and a commitment to seeking inter-

national consensus as well as an openness to rights

and norms from outside the trade regime.

INTRODUCTION

When the World Trade Organization (WTO) became a

new regime1twenty years ago, a major debate was

occurring within the trade and environment commu-

nity. The debate was whether unilateral trade measures

– such as bans on imports, quotas, tariffs, product-

labelling requirements and other policies – that

addressed environmental challenges arising outside of

the jurisdiction of the importing state were permissible

under trade law. The General Agreement on Tariffs and

Trade (GATT) – first enshrined in 1947 – is silent on

this issue; key provisions of GATT Article XX provide

that countries should not be prevented from adopting

or enforcing certain trade measures where the mea-

sures are ‘necessary to protect public morals’, ‘neces-

sary to protect human, animal or plant life or health’ or

relate ‘to the conservation of exhaustible natural

resources’, with no express jurisdictional limit.2The

debate raged during a trade dispute over a United

States embargo on tuna fished in ways that harmed

dolphins within and outside of American coastal juris-

diction. Many developing countries saw this measure as

representing a ‘new wave of environmental colon-

ialism’.3The 1991 GATT Panel report – never

adopted – found the American embargo to have ‘extra-

jurisdictional application’ and held this to be impermis-

sible under the terms of the GATT.4This position

shifted with the institutionalization of the WTO in 1994

(which, among other things, introduced the principle of

sustainable development into the GATT’s preamble). In

1998, the newly established Appellate Body ruled on a

United States ban on shrimp designed to protect sea

turtles,5and noted that there was a sufficient nexus

between the sea turtles and the importing country given

that waters subject to American jurisdiction were tra-

versed by the migratory animals.

1I am drawing upon def‌inition of regimes as ‘sets of norms, decision-

making procedures and organisations coalescing around functional

issue-areas and dominated by particular modes of behaviour,

assumptions and biases’. M.A. Young, ‘Introduction: The Productive

Friction between Regimes’, in: M.A. Young (ed.), Regime Interaction

in International Law: Facing Fragmentation (Cambridge University

Press, 2012), 1, at 11. This def‌inition builds on works such as S.

Krasner, ‘Structural Causes and Regime Consequences: Regimes as

Intervening Variables’, in: S. Krasner (ed.), International Regimes

(Cornell University Press, 1983), 1; and A. Fischer-Lescano and G.

Teubner, ‘Regime-Collisions: The Vain Search for Legal Unity in the

Fragmentation of Global Law’, 25:4 Michigan Journal of International

Law (2004), 999.

2General Agreement on Tariffs and Trade 1994 (Marrakesh, 15 April

1994; in force 1 January 1995) (‘GATT’), Article XX (a), (b), (g).

3I.M. Porras, ‘The Rio Declaration: A New Basis for International

Cooperation’, 1:3 Review of European Community and International

Environmental Law (1992), 245.

4GATT Panel Report 3 September 1991, United States –Restrictions

on Imports of Tuna, DS21/R (‘US-Tuna I’).

5WTO AB 6 November 1998, United States – Import Prohibition of

Certain Shrimp and Shrimp Products, WT/DS58/AB/R (‘US-Shrimp’).

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Review of European Community & International Environmental Law

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In recent times, questions of jurisdiction have become

more complex with the acknowledgement that trade

measures seeking to address environmental concerns

arising abroad may impact upon indigenous peoples

and other groups such as artisanal and subsistence

fishers, forest dwellers or Inuit seal hunters. Irrespec-

tive of legal status, these people may have a continuous

connection to the land or natural resources that pre-

dates formal settlement, and may be forced to alter

income-generating activities due to the policies of

States other than the ones in which they live.6When the

European Union (EU) imposed a ban on seal products

in 2009, it exempted trade from Inuit and other indig-

enous communities in an attempt to reconcile these

interests. The challenge to the EU’s ban by Canada and

Norway forced the Appellate Body to address this issue

for the first time.7While the case arguably rendered

moot the question of the GATT’s jurisdictional limita-

tions (because, although the ban extended to products

from seal hunts conducted outside EU territory, the

jurisdictional link to the EU was established by the

sense of moral ‘indignation and revulsion’8held by EU

citizens and consumers at home), it impacted on sover-

eign controversies elsewhere.

In this article, I address these jurisdictional issues in

two parts. First, I determine whether trade measures

addressing environmental concerns arising abroad

violate any jurisdictional limitations of the GATT. This

requires a close reading and textual analysis of WTO

jurisprudence and related literature on sovereignty and

jurisdiction in public international law. Second, I

examine the situation of trade measures addressing

environmental concerns abroad which impact upon

indigenous peoples or other groups. This requires an

examination of the EC-Seals decision and a review of a

broader set of norms and principles from other inter-

national regimes, including the United Nations Decla-

ration on the Rights of Indigenous Peoples (UNDRIP).9

In the third part, I offer some tentative conclusions

from the perspective of sovereign States (and their

trade law commitments) and from the perspective of

indigenous peoples or other groups. My aim here is not

to provide a normative account of the incorporation of

indigenous issues into the trading regime – which

would be a complex and difficult task, harder even than

accounting for the WTO regime’s treatment of ‘devel-

oping countries’ and associated questions about the

differentiation of socio-economic groups within coun-

tries.10 Instead, limited observations are made about

the special quandaries currently arising when WTO

members seek to use trade measures to deal with envi-

ronmental challenges in remote places, especially when

such measures affect particular communities who may

have faced historic injustice in dealing with sovereign

rulers and whose cultural or other practices may be

affected by the relevant trade measures. Thus, the

article is a reflection on ‘trade and the environment’

(noting that the WTO regime’s approach to unilateral

trade measures has become more nuanced and sensi-

tive over time), but also points to emerging issues

which, I argue, require at the very least an openness on

the part of the WTO regime to other legal regimes.

ADDRESSING ENVIRONMENTAL

CONCERNS THROUGH TRADE

Addressing environmental concerns through trade

measures gives rise to fears of protectionism. When the

concerns are manifested outside of the jurisdiction of

the importing State, these fears morph into concerns

about a foreign State’s interference in domestic affairs,

and thus give rise to allegations of exercises of extrater-

ritorial jurisdiction. This section discusses these issues

by: (i) giving an historic overview of the apprehension

that trade measures to protect the environment could

be a mask for protectionism; (ii) differentiating

between trade measures addressing environmental

concerns within and outside the territory of the import-

ing State; (iii) setting out the current jurisprudence on

the need for a sufficient nexus between the importing

State and the relevant environmental concern; and (iv)

illustrating how trade measures to address environ-

mental concerns might be necessary to protect public

morals, as argued for the first time in the EC-Seals case.

6As an example of this scenario, recent efforts within the United

Nations Framework Convention on Climate Change (Rio de Janeiro,

9 May 1992; in force 21 March 1994) (‘UNFCCC’) to reduce emis-

sions from deforestation and forest degradation (REDD+) have

focused on creating f‌inancial incentives for the preservation of tropi-

cal forests. Yet indigenous communities have disputed that they

should alter their forest practices to address a global environmental

challenge that they have not caused (and expressed scepticism that

they will receive compensation from the State bureaucracies that

have historically marginalized them). See, most recently, the Warsaw

Framework for REDD+. See further UNFCCC, Report of the Confer-

ence of the Parties on Its Nineteenth Session, Warsaw, 11–23

November 2013 (UN Doc. FCCC/CP/2013/10, 31 January 2014), at

paragraph 44.

7WTO DS 25 November 2013, European Communities – Measures

Prohibiting the Importation and Marketing of Seal Products,

WT/DS400/R, WT/DS401/R, (‘EC-Seals, Panel’) WTO AB 18 June

2014, European Communities – Measures Prohibiting the Importation

and Marketing of Seal Products, WT/DS400/AB/R, WT/DS401/AB/R

(‘EC-Seals, AB’).See also G. Marceau, ‘A Comment on the AB

Report in EC-Seal Products in the Context of the Trade and Environ-

ment Debate’, 23:3 Review of European, Comparative and Interna-

tional Environmental Law (2014).

8The phrase is from the European Commission proposal cited in

EC-Seals, Panel, n. 7 above, at paragraph 7.395.

9Declaration on the Rights of Indigenous Peoples (UN General

Assembly Resolution A/RES/61/295, 13 September 2007)

(‘UNDRIP’).

10 See, e.g., how these questions are posed in the climate change

regime: D. Farber, ‘Beyond the North-South Dichotomy in Interna-

tional Climate Law: The Distinctive Adaptation Responsibilities of the

Emerging Economies’, 22:1 Review of European, Comparative and

International Environmental Law (2013), 42.

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