Multilateral Environmental Agreements and the GATT: Conflict and Resolution?

By Wold, Chris | Environmental Law, Fall 1996 | Go to article overview

Multilateral Environmental Agreements and the GATT: Conflict and Resolution?


Wold, Chris, Environmental Law


I. INTRODUCTION

International trade increasingly is making human society economically and socially interdependent. A Chevrolet, the quintessential American automobile, may contain predominately Japanese parts, and the design of the automobile and the management of the factory may rely on German ingenuity and Japanese efficiency.(1) Such interdependence has led to stunning growth in international trade.(2) Similarly, resolution of global environmental problems demands cooperative action by a large number of countries. The restoration of the ozone layer, depleted by the use of chlorofluorocarbons (CFCs) and other ozone depleting substances for refrigeration and air conditioning, cannot be accomplished without most countries agreeing to eliminate their consumption and production of ozone depleting substances. Global warming and international traffic in endangered species likewise cannot be resolved without the participation of many countries.

Although conflict is not inherent, trade can cause environmental problems or conflict with environmental goals.(3) International trade rules, as declared in the General Agreement on Tariffs and Trade (GATT) and incorporated into the new World Trade Organization (WTO),(4) the principal international trade agreement and institution, often conflict with environmental goals and laws. Nations, however, continue to treat trade and environment separately, rather than make them mutually reinforcing. This dichotomy could pose significant problems for resolving global environmental problems, because many multilateral environmental agreements rely on trade restrictions to achieve their goals.

Although no country has challenged a trade measure of a multilateral environmental agreement as inconsistent with GATT, countries have challenged domestic environmental laws, and GATT and WTO dispute resolution panels have concluded that several national environmental laws are inconsistent with GATT rules.(5) Recent opinions of GATT panels and the failure of the negotiators of the WTO to exempt multilateral environmental agreements from GATT's scrutiny--as the parties to the North American Free Trade Agreement (NAFTA) did(6)--cast doubt on whether trade measures in multilateral environmental agreements would survive a GATT challenge. Moreover, according to the GATT Working Group on Trade and the Environment, GATT parties that are nonparties to a multilateral environmental agreement

may wish to use their GATT rights if they believe they are suffering from

unfair or unnecessary discrimination; the provisions of [a multilateral

environmental agreement], or the judgment of parties to a [multilateral

environmental agreement], should not be allowed to override those rights,

especially without there being an obligation to explain the case for trade

discrimination if there were to be a challenge under the GATT.(7)

Other international bodies are compiling evidence of the effectiveness and necessity of the trade provisions in various multilateral environmental agreements in light of GATT.(8) The tension between trade rules and environmental rules seems likely to increase in the near future as the use of trade restrictions in multilateral environmental agreements becomes more prevalent and trade rules become more stringent. In fact, the GATT parties recently rejected a proposal to ease GATT sCrutiny of trade restrictions adopted pursuant to multilateral agreements.(9)

Because multilateral environmental agreementS increasingly use trade measures to implement and enforce their objectives, some reconciliation must occur. The Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES)(10) and the Montreal Protocol on Substances That Deplete the Ozone Layer (Montreal Protocol)(11)--perhaps the two most successful multilateral environmental agreements--as well as the Basel Convention on the Control of TranSboundary Movements of Hazardous Wastes and Their Disposal (Baser Convention),(12) rely on trade measures to achieve their environmental goals and to enforce the treaties' provisions against parties and nonparties alike. …

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