- Minister of Supply and Services Canada, North American Free Trade Agreement (1992) (NAFTA).
- The US administration under President Clinton negotiated separate side agreements with Canada and Mexico dealing with deficiencies in NAFTA's provision for environmental protection, the threat of import surges and labour standards. To this point, these side agreements have satisfied only a few of the US critics of NAFTA and opposition to the agreement in the US remains intense.
- Thea Lee, “Happily Never NAFTA: There's No Such Thing as a Free Trade”, Dollars and Sense (January/February 1993) 12.
- Brent Blackwater, Vice-President of Friends of the Earth, responded to the Bush administration's claim that NAFTA is the greenest trade agreement ever negotiated by characterising this description as “mere green sheen. It's like algae on a pipe—it's going to slip right off”. (1992) 15 Int'l Env Reporter 695.
- General Agreement on Tariffs and Trade, TIAS No 1700, 55 UNTS 194 (GATT). NAFTA, 2101.1 incorporates GATT, XX(b) and (g).
- The “maquiladora” programme allows duty-free movement of components to Mexico and the return of those goods to the United States with tariffs paid only on the value added in Mexico. Malissa Hathaway McKeith, “The Environment and Free Trade: Meeting Halfway at the Mexican Border” (1991) 10 UCLA Pacific Basin LJ 183 at 185.
- In April 1991 a group of attorneys from the US Environmental Protection Agency and the Department of State visited Mexico to work cooperatively with officials from Mexico's Secretariat of Urban Development and Ecology in studying Mexican environmental legislation and assessing compliance monitoring and enforcement. The group found that Mexican environmental laws, regulations and standards are largely comparable to those in the United States; however, there are serious deficiencies in the degree of compliance monitoring and enforcement of environmental policies and standards: Edith Brown Weiss, “An US Perspective on the North American Free Trade Agreement and the Environment: The Competitive Aspects of Mexico's Accession to an Enlarged Free Trade Agreement” (1992) 18 Canada-United States L J 199 at 202–203.
- Testimony of John Cavanagh, Institute for Policy Studies in a hearing before the Trade Staff Policy Committee of the Office of the US Trade Representative, in Washington, DC on 3 September 1991 reprinted in part in Frances Lee Ansley, “North American Free Trade Agreement: The Public Debate” (1992) 22 Ga J Int'l & Comp L 329 at 405 (the Public Debate).
- Weiss Supra note 7 at 203.
- Thomas J Schoenbaum, “Free International Trade and Protection of the Environment: Irreconcilable Conflict?” (1992) 86 The Am J Int'l L 701. Although some businesses relocate due to laxity of environmental regulation or enforcement (particularly where there are unusually strict standards), the prevailing view is that relocation is motivated more often by other factors such as labour and transport costs, available resources, access to markets, and political stability: “The Greening of Protectionism” The Economist (27 February-5 March 1993) 25 at 26; McKeith Supra note 6 at 194. Some studies conducted have indicated that the amounts allocated to compliance with environmental regulation as a percentage of total output are relatively low for the great majority of industries: Patrick Low, “Trade Measures and Environmental Quality: The Implications for Mexico's Exports” in Patrick Low, ed, International Trade and Development, World Bank Discussion Papers No 159 (Washington: The World Bank, 1992) 105 at 106. For a similar conclusion see Interagency Task Force Coordinated by the Office of the United States Trade Representative, Draft Review of US-Mexico Environmental Issues, 15 October 1991 at 134–143 (US Environmental Review).
- Canada, North American Free Trade Agreement Canadian Environmental Review, October 1992 at 33 [hereinafter Canadian Environmental Review]; testimony of Lori Wallach of the Public Citizen and John Audley of the Sierra Club at a hearing before the Trade Staff Policy Committee of the Office of the US Trade Representative held at Washington DC on 4 September 1991 and reprinted in part in the Public Debate Supra note 8 at 416–417. NAFTA, however, does not include provisions for a countervailing duty in these circumstances. Subsidy and countervail rules applicable to trade among the NAFTA parties continue to be those contained in the GATT Subsidies Code: Canadian Environmental Review, see this note at 32–33.
- Canadian Environmental Review Supra note 11 at 13–14.
- United States—Restrictions on Imports of Tuna, GATT Dispute Settlement Panel Report, submitted to the Parties 16 August 1991, (1991) 30 ILM 1594 (Tuna/Dolphin Panel Report).
- KGwen Beacham, “International Trade and the Environment: Implications of the General Agreement on Tariffs and Trade for the Future of Environmental Protection Efforts” (1992) 3 Colo J Int'l Envt'l L & Pol'y 655 at 667 and 678–679.
- David Ross, “Making GATT Dolphin-Safe: Trade and the Environment” (1992) 2 Duke J Comp p Int'l L 345 at notes 77–80 and accompanying text.
- In that region, dolphins swim over schools of yellowfin tuna. Fishing vessels locate the tuna by finding and chasing dolphins on the ocean surface; a purse-seine net encircles the tuna and captures the dolphins, injuring or drowning many of them in the process. For details of the purse-seine fishing method used and its effect on dolphins, see the text and notes in Beacham Supra note 14 at 664–665.
- 16 USC 1361–1407.
- Marine Mammal Protection Act Amendments of 1988, Pub L 100–711, 102 Stat 4755.
- To gain access to the US market for the yellowfin tuna it has caught, a foreign country must prove that its overall regulatory regime for the taking of dolphins is comparable to that of the United States. To meet this requirement, the foreign country must prove that the average rate of incidental taking of dolphins by its tuna fleet is not in excess of 1.25 times the average incidental taking rate of US vessels during the same period. The United States linked the maximum incidental dolphin taking which a foreign country had to meet during a particular period to the taking rate actually recorded for US fishers during the same period. Consequently, foreign authorities could not know whether, at a given time, their policies conformed to the US dolphin protection standards: Tuna/Dolphin Panel Report Supra note 13 at par 5.2 and 5.28.
- For details of the actions see David Wirth, “A Matchmaker's Challenge: Marrying International Law and American Environmental Law” (1992) 32 Va J Int'l L 377 at 407 notes 106, 107.
- Tuna/Dolphin Panel Report Supra note 13 at par 5.28.
- Ibid at par 5.26.
- Ibid at par 5.27.
- Ibid at par 5.31.
- Ibid at par 5.28 and 5.33. See note 19 above for a description of these “unpredictable conditions”.
- Ibid at par 5.11–5.15.
- For a view of the Tuna/Dolphin Panel Report from the environmental community see Robert Housman and Durwood Zaelke, “Trade, Environment, and Sustainable Development: A Primer” (1992) 15 Hastings Int'l & Comp L Rev 535 at 546–551 and Beacham Supra note 14 at 664 to 667.
- Housman and Zaelke Ibid at 548.
- Ibid at 549–550.
- Robert Housman and Durwood Zaelke, “The Collision of the Environment and Trade: The GATT Tuna/Dolphin Decision” (1992) 22 Env'l L Reporter 10268 at 10275–10276.
- Ibid.
- Weiss Supra note 7 at 204 where Weiss maps out some approaches that she hoped NAFTA would take in integrating trade and environment issues.
- External Affairs Canada, Canada-United States Free Trade Agreement, 10 December 1987. The agreement is implemented in the United States by the United States-Canada Free Trade Agreement Implementation Act of 1988, Pub L 100–449, and in Canada by the Canada-United States Free Trade Agreement Implementation Act, SC 1988, c 65 (Canada-US FTA).
- US Environmental Review Supra note 10 at 55.
- NAFTA, 101. GATT requires that a free trade area facilitate trade among the countries concerned, without raising the barriers to trade with countries outside the free trade area.
- NAFTA, 302, Annex 302.2.
- NAFTA, Annex 302.2 and Canada, North American Free Trade Agreement: An Overview and Description, August 1992 at 2.
- Canada, North American Free Trade Agreement: The NAFTA Manual, August 1992 under the heading entitled “NAFTA-Removal of Tariffs and Trade Barriers” (Issues Series unnumbered); Anne M Driscoll, Office of Mexico, US Department of Commerce, “Key Provisions of the North American Free Trade Agreement”, Business America (19 October 1992) 3.
- External Affairs and International Trade Canada, Highlights of the North American Free Trade Agreement, August 1992 at 2.
- GATT, XI. 1, NAFTA, 309.1.
- NAFTA, 309.2.
- NAFTA, 301.1.
- GATT, III.
- John H Jackson, The World Trading System (Cambridge, Mass: MIT Press, 1989) at 189.
- See discussion in Part 1.2 above.
- Eliza Patterson, “International Trade and the Environment: Institutional Solutions” (1991) 21 Env'l L Reporter 10599 at 10600.
- Ibid.
- Ibid.
- See discussion in Part 1.2 above.
- NAFTA, 301.1.
- For a summary of the principal environmental provisions found in NAFTA, see Canadian Environmental Review Supra note 11 at 35–36.
- Unfortunately, NAFTA's Preamble does not contain legally binding commitments; however, courts will examine a preamble for the history and purpose of a treaty as an aid in interpreting the intention of the parties with respect to their treaty obligations: Hugh M Kindred, gen ed, International Law: Chiefly as Interpreted and Applied in Canada, 4th ed (Canada: Emond Montgomery, 1987) at 159–160.
- NAFTA, 1114.2. The provision, however, is hortatory not mandatory.
- NAFTA, 1114.2.
- NAFTA, 104. See discussion in Part III.2 below.
- NAFTA, Chapter 9. See discussion in Part III.3 below.
- For example, where a party challenges an environmental standard as being inconsistent with NAFTA, that party has the burden of proof: NAFTA, 914.4. This is in contrast to GATT where a party seeking to justify an environmental measure under Article XX(b) or (g) has the burden of proof.
- GATT, XX(b).
- GATT, XX(g).
- GATT, opening clause of XX.
- Thailand—Restrictions on Importation of and Internal Taxes on Cigarettes, GATT Dispute Panel Report, adopted by GATT council 7 November 1990, (1991) 30 ILM 1122 at par 74–75 (Thailand Cigarettes).
- Tuna/Dolphin Panel Report Supra note 13 at par 5.28.
- Thailand Cigarettes Supra note 61 at par 77–81; Tuna/Dolphin Panel Report Supra note 13 at par 5.28.
- NAFTA, 2101.1.
- Tuna/Dolphin Panel Report Supra note 13 at par 3.43.
- See discussion above at note 22.
- Ludwig Kramer, “Environmental Protection and Article 30 EEC Treaty” (1993) 30 Common Market L Rev 111 at 117–118. Kramer argues in the context of the European Economic Community Treaty that many environmental measures such as those enumerated in this paragraph would be excluded from the scope of a provision which aims to protect the health and life of humans, animals or plants.
- Canadian Environmental Review Supra note 11 at 13–14; Malissa Hathaway McKeith and Mary Hall, “Environmental Compromise: Striking the Balance Between Trade and Ecology” (1992) 15 Int'l Env Reporter 724 at 725.
- NAFTA, 103.1.
- NAFTA, 103.2.
- Article 104 reads: “1. In the event of any inconsistency between this Agreement and the specific trade obligations set out in: (a) the Convention on International Trade in Endangered Species of Wild Fauna and Flora, done at Washington, 3 March 1973, as amended 22 June 1979, (b) the Montreal Protocol on Substances that Deplete the Ozone Layer, done at Montreal, 16 September 1987, as amended 29 June 1990, (c) the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal, done at Basel, 22 March 1989, on its entry into force for Canada, Mexico and the United States, or (d) the agreements set out in Annex 104.1, such obligations shall prevail to the extent of the inconsistency, provided that where a Party has a choice among equally effective and reasonably available means of complying with such obligations, the Party chooses the alternative that is the least inconsistent with the other provisions of this Agreement. 2. The Parties may in writing modify Annex 104.1 to include any amendment to an agreement referred to in paragraph 1, and any other environmental or conservation agreement.” Annex 104.1 lists the following: “1. The Agreement Between the Government of Canada and the Government of the United States of America Concerning the Transboundary Movement of Hazardous Waste, signed at Ottawa, 28 October 1986. 2. The Agreement Between the United States of America and the United Mexican States on Cooperation for the Protection and Improvement of the Environment in the Border Area, signed at La Paz, Baja California Sur, 14 August 1983”.
- NAFTA, 104.2. See note 71 for the complete text of 104.
- NAFTA, 104.1. See note 71 for the complete text of NAFTA, 104.
- Alex Hittle and Scott Nilson, Response of Environmental and Consumer Organisations to the 6 September 1992 Text of the North American Free Trade Agreement, 6 October 1992 at B. (Endorsing organisations: American Cetacean Society, Arizona Toxics Information, Border Ecology Project, Centre for International Environmental Law, Defenders of Wildlife, Earth Island Institute, Fair Trade Campaign, Friends of the Earth, Humane Society of the United States, Public Citizen, Sierra Club).
- Ibid.
- Ibid.
- “US Lawmaker Says NAFTA ‘More Brown than Green’” (1992) 15 Int'l Env Reporter 611 citing a letter dated 14 September 1992 from Representative Ron Wyden (D-Oregon) to US Trade Representative Carla Hills; see also Hittle and Nilson Supra note 74 at 8.
- NAFTA, 104.2.
- Hittle and Nilson Supra note 74 at 8.
- GATT, Trade and Environment, Doc GATT/1529 (3 February 1992) reprinted in (1992) 4 World Trade Materials, 37 at 50–52.
- John Kirton, “Canada's Contribution to a New Trade-Environment Regime” in John Kirton and Sarah Richardson, eds, Trade, Environment & Competitiveness (Ottawa: National Round Table on the Environment and the Economy, 1992) 235 at 255–256.
- In this section of the article, the term “standards” is used in the general sense of specifications, with which compliance may be voluntary or mandatory, which lay down characteristics of a product or a process. Occasionally, “standard” is used as defined in NAFTA, 915: see Scope of Coverage of Chapter 9 below for the definition; this particular usage should be clear from the context.
- John H Jackson, Jean-Victor Louis, and Mitsuo Matsushita, Implementing the Tokyo Round: National Constitutions and International Economic Rules (Ann Arbor: The University of Michigan Press, 1984) at 12.
- R W Middleton, “The GATT Standards Code” (1980) 14 J World Trade L 201.
- Ibid at 201–202.
- Jackson Supra note 44 at 197. Jackson cites, as an example, agency or industry groups which consciously try to “gerrymander” standards to make it comparatively more difficult for foreign producers to comply.
- NAFTA, 904, 905.
- NAFTA, 906, 908.
- NAFTA, 909, 910.
- NAFTA, 911, 914.
- NAFTA, 913.
- The subject matter of standards under Chapter 9 is unlimited: NAFTA, 904.1. See Part C.3(b) below for a discussion of the scope of coverage of Chapter 9.
- Organisation for Economic Co-operation and Development, Environmental Standards: Definitions and the Need for International Harmonisation (Paris: OECD, 1974) at 6. The OECD distinguishes between four major categories of environmental standards: quality standards which lay down the maximum permissible levels of pollution in air, water and soil; emission standards which specify the quantity of pollutants which may be discharged from a given source per unit of time or during a given cycle of operations; process standards which impose certain production processes or methods for stationary sources such as factories; and product standards which prescribe the physical or chemical properties of a product, the rules for making up, packaging or presenting a product and the maximum permissible polluting emissions from the product during its use: ibid at 6–10.
- Ibid at 6.
- For the full text of NAFTA, 904.1, see Part III.3(c) below.
- Chapter 9 does not apply to sanitary and phytosanitary measures which are dealt with in Chapter 7, Section B, nor to technical specifications relating to government procurement, which are dealt with in Chapter 10: NAFTA, 901.1, 901.2.
- NAFTA, 907 reads: “1. A Party may, in pursuing its legitimate objectives, conduct an assessment of risk. In conducting an assessment, a Party may take into account, among other factors relating to a good or service: (a) available scientific evidence or technical information; (b) intended end uses; (c) processes or production, operating, inspection, sampling or testing methods; or (d) environmental conditions. 2. Where pursuant to Article 904(2) a Party establishes a level of protection that it considers appropriate and conducts an assessment of risk, it should avoid arbitrary or unjustifiable distinctions between similar goods or services in the level of protection it considers appropriate, where the distinctions: (a) result in arbitrary or unjustifiable discrimination against goods or service providers of another Party; (b) constitute a disguised restriction on trade between the Parties; or (c) discriminate between similar goods or services for the same use under the same conditions that pose the same level of risk and provide similar benefits.”
- NAFTA, 915, definition of “standard” and “technical regulation.”
- David Robertson, “Trade and Environment: Harmonisation and Technical Standards” in Patrick Low, ed, International Trade and the Environment, World Bank Discussion Papers No 159 (Washington: The World Bank, 1992) 309 at 315–316. Robertson makes this argument in the context of the GATT Uruguay Round drafts of the Agreement on Technical Barriers to Trade where the addition of the word “related” is intended to link process and production methods to the characteristics of the product itself.
- Ibid.
- NAFTA, 904.3(a) referring to NAFTA, 301 which incorporates GATT, III.
- NAFTA, 904.3(b).
- GATT, XX(b) and (g) in an amended form is incorporated into NAFTA by NAFTA, 2101.1. See Part III. 1 above for a discussion of NAFTA, 2101.1.
- In doing so, NAFTA improves on the GATT Agreement on Technical Barriers to Trade which has been criticised for failing to clarify what is meant by its use of “unnecessary obstacles to international trade” in Article 2.1: Middleton Supra note 84 at 206.
- The formulation of this test largely tracks the wording of the Trade Agreements Act of 1979, Title IV which is the US legislation which implements the GATT Agreement on Technical Barriers to Trade, Pub L 96–39 s 2531 (codified at 19 USCA s 2531).
- Housman and Zaelke Supra note 27 at 548–549.
- Ibid.
- Black's Law Dictionary, 5th ed (St Paul Minn: West Publishing, 1979) at 389.
- The Oxford English Dictionary, 2nd ed, Vol IV at 447.
- From the legislative history and purpose of the Trade Agreements Act of 1979, reprinted in [1979] US Code Cong & Adm News 381 at 538. Also see note 105 above.
- Canada's Landing Requirement for Pacific Coast Salmon and Herring, Canada-United States Trade Commission Panel, Final Report, 16 October 1989, 2 TCT 7162 (Salmon and Herring FTA Report).
- GATT, XI is incorporated into the Canada-US FTA by Article 407.
- GATT, XX(g) is incorporated into the Canada-US FTA by Article 1201.
- Salmon and Herring FTA Report Supra note 111 at par 7.07.
- Ibid at par 7.38.
- For example, because of the particular means used to achieve the level of protection specified in the SRM: Supra note 110.
- Thailand Cigarettes Supra note 61 at par 74–75; Tuna/Dolphin Panel Report Supra note 13 at par 5.27–5.28.
- NAFTA, Article 103.1 which reads: “The Parties affirm their existing rights and obligations with respect to each other under the General Agreement on Tariffs and Trade and other agreements to which such Parties are party.”
- Ludwig Kramer, “Environmental Protection and Article 30 EEC Treaty” (1993) 30 Common Market L Rev 111 at 120.
- Case 302/86 [1988] ECR 4607, [1989] 1 CMLR 619 (Danish Bottles case).
- Treaty Establishing the European Economic Community, Article 30 reads: “Quantitative restrictions on imports and all measures having equivalent effect shall, without prejudice to the following provisions, be prohibited between Member States.”
- Danish Bottles case Supra note 120 at par 6 of the Decision.
- Transcript of the Danish Bottles case cited in Toni R F Sexton, “Enacting National Environmental Laws More Stringent than Other States’ Laws in the European Community: Re Disposable Beer Cans: Commission v Denmark” (1991) 24 Cornell Int'l L J 563 at 581, note 134.
- Danish Bottles case Supra note 120 at par 29 of the Opinion. The application of the proportionality principle suggested in this paragraph is speculative. It is necessarily so because many details of the operation of this principle have yet to be decided, especially where environmental matters are concerned; few environmental cases have been decided on the basis of Article 30: Kramer Supra note 119 at 120–121.
- NAFTA, 905.2.
Journal of Energy & Natural Resources Law
Volume 12, 1994 - Issue 1: International Energy Trade