WTO Public Symposium 2003: Relationship between MEAs and the WTO

Background

It is widely recognized that sustainable development and environmental regulation is better accomplished multilaterally rather than through numerous unilateral agreements. To this end, at the Rio Earth Summit in 1992[1], conference participants endorsed what are now commonly known as Multilateral Environmental Agreements (MEAs)[2]. According to the WTO, out of over 200 MEAs in existence only twenty concern trade[3]. Because MEAs and WTO trade agreements address many of the same issues and concerns from different perspectives, occasional conflict between the two must be mitigated in some way to ease controversy for future environmental regulations. The resolution of the interface problem between MEAs and the WTO was cited as a key negotiating issue and mandated as a topic of discussion in paragraph 31(i) of the Doha Declaration[4], but just how to reconcile the two remains to be decided.

The Problem

Problems are most likely to occur when an MEA allows those who sign to take action against non-signatories because this requirement violates the WTO principal of non-discrimination. For example, the Montreal Protocol on Substances that Deplete the Ozone Layer and the Basel Convention both encourage those who sign to apply heavier trade restrictions against countries that have not signed the agreement than to those who have[5]. While concrete disputes have yet to arise, the potential for conflict exists and the international community must clarify the relationship between trade obligations set out by the MEAs and the WTO's trade rules to mitigate further conflict.

The uncertainty as to whether the trade related portions of MEAs are compatible with WTO rules can be used to the advantage of countries that would rather have MEAs remain weak. For example, subordination to WTO rules in environmental negotiations weakens their provisions and their effectiveness once adopted as in the scenario with Biosafety Protocol and POPs negotiations[6].

Issues

In order to elucidate the relationship between these two types of regulatory bodies, the negotiators will have to address many legal and practical issues. Firstly, the language of the Doha Declaration on this topic has raised a few concerns. While the document ensures that negotiations in this round do "not add to or diminish the rights and obligations of Members under existing WTO agreements…nor alter the balance of these rights and obligations,"[7] it includes no similar safeguard for the MEAs. The WTO has yet to grant representatives of MEAs observer status for WTO negotiations, as outlined in the original agreement, leaving them at a significant disadvantage. Lastly, the WTO mandate is limited to the least controversial aspects of the relationship and does not set out the goal of addressing non-parties to MEAs and trade-related measures that are permitted but not listed by an MEA.

The question remains: should disputes under an MEA be decided by the WTO since it has a dispute settlement framework? International law states that if all parties to a treaty are also party to a more specialized treaty, the provisions of the specialized agreement (the MEA in this case) takes precedence. [8]. But each MEA has a different method for review and they could benefit from a universal standard[9]. The limited financial and managerial capacity of MEAs is one source of the problem of avoiding non-compliance and non-enforcement of these agreements [10].

In order to avoid conflict in the future, the Committee on Trade and Environment (CTE) has focused on facilitating information exchange between MEAs and the WTO[11], and other suggestions involve the simultaneous enactment of some regulations, use of WTO committees for goals of the MEAs, and efforts to enhance the input of non-trade negotiators in WTO negotiations[12]. A report by UNEP, has investigated potential synergies that may be uncovered through mutual cooperation of the WTO and MEAs to aid in establishing a more concrete framework for trade and environmental issues. [13]

[1] General Info on the UN Conference on Environment and Development (1992)

[2] What is an MEA?, IIED

[3]  CTE on: trade rules, environmental agreements and disputes, WTO

[4] The text of the Doha Ministerial Declaration

[5]  CTE on: trade rules, environmental agreements and disputes, WTO

[6] A letter written by the WWF to the WTO about the MEA-WTO relationship

[7] The text of the Doha Ministerial Declaration

[8]  CTE on: trade rules, environmental agreements and disputes, WTO

[9] Raustiala, Kal, "Reporting and Review Institutions in 10 MEAs"

[10] Summary of a CUTS report on MEAs

[11] WTO: Trade, Environment Officials Progress on MEA-WTO Links, ICTSD Bridges Weekly Trade Digest

[12] UNEP Meeting on Enhancing Synergies and Mutual Supportiveness of MEAs and the WTO, Summary

[13] Enhancing Synergies and Mutual Supportiveness of MEAs and the WTO, A Synthesis Report from the Johannesburg Summit