A disturbing trend recently in the negotiation of multilateral environmental agreements is the push to include World Trade Organization (WTO) “supremacy clauses” in these agreements. These clauses threaten to make international trade law automatically superior to multilateral environmental agreements.
Supremacy clause language states that the environmental agreement will not alter rights and obligations under existing international agreements. The POPs negotiations have been no exception. The text of the draft POPs Convention that came out of the Second Intergovernmental Negotiating Committee Meeting (INC2) in Nairobi proposes such a supremacy clause.i The proposed text is contained in article N bis, and is still bracketed (i.e. not yet agreed). It reads:
The provisions of this Convention shall not affect the rights and obligations of any Party deriving from any existing international agreements.ii
Similar text was proposed in drafts of the Prior Informed Consent (PIC) Agreement, but eventually it was moved out of the text of the Agreement proper and into the preamble.iii The POPs Protocol to the Convention on Long-Range Transboundary Air Pollution did not contain a WTO supremacy clause, but its preamble does state “that measures taken to reduce [POPs] emissions should not constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on international competition and trade[.]”iv
The WTO Supremacy Clause Would Subordinate the POPs Convention to the WTO
Inclusion of a supremacy clause would likely operate to make international trade law automatically superior to the POPs Convention. This threatens to make the goals of the POPs Convention (e.g., elimination of POPs) subordinate to the goals of the international trading system. The precise legal impact of the WTO supremacy clause will depend on future interpretations of multilateral environmental agreements and WTO rules.
As this briefing paper will show, the supremacy clause
- threatens to undermine the environmental exceptions in the WTO and the emerging consensus at the WTO to accommodate trade-related environmental measures in multilateral environmental agreements.
- confers on the WTO dispute settlement process the final authority to decide any future controversy between the POPs Convention and the WTO rules.
- sets a dangerous precedent of environmental negotiators limiting – unnecessarily – the policy tools they have to achieve sustainable development.
- is unnecessary since the international rules of treaty interpretation are available to address conflicts between trade and environmental agreements that may arise.
The POPs negotiations are the appropriate forum for determining the balance between trade and environment measures and the most appropriate mix of measures — trade and non-trade — to achieve the goal of POPs elimination. For these reasons, the supremacy clause should be removed from the POPs agreement.
The Supremacy Clauses Undermine the Emerging Consensus at the WTO to Accommodate Environmental Measures Agreed Upon in Multilateral Negotiations
The WTO rules themselves explicitly acknowledge that countries may take measures to protect human, animal and plant life and health and to conserve exhaustible natural resources even when those measures might otherwise violate WTO rules.v No multilateral environmental agreement has ever been directly challenged in the WTO, and experts widely believe that this is because any measure authorized under such an agreement would be presumed to be covered by these environmental exceptions. Such a presumption recognizes the legal equality of environmental agreements and trade agreements.vi
The inclusion of a supremacy clause in an environmental agreement, such as the POPs Convention, might call into question whether the WTO’s environmental exceptions apply to measures developed through multilateral environmental agreements. Simply by calling this presumption into question, supremacy clauses, and the countries that promote them, do great harm to the growing, yet fragile, consensus at the WTO to ensure that trade rules are interpreted in a manner that accommodates environmental mandates developed through an open, multilateral process. Measures taken pursuant to international environmental agreements are unlikely to be disguised restrictions on trade, since they are developed in multilateral fora where producing and consuming, large and small, rich and poor countries are all represented. A supremacy clause could reverse the recognition of most WTO Member States that multilateral environmental agreements should never be challenged by the WTO.
The WTO is the Wrong Forum for Resolving Disputes Between the POPs Convention and the Trade Rules
Including a WTO supremacy clause in the POPs Convention could also function in practice to lead countries to resolve all trade-related issues at the WTO’s dispute settlement body (DSB). The WTO DSB does not provide an objective or appropriate forum in which to determine the proper balance between the trade rules and measures contained in a future POPs Convention (or any environmental agreement). The WTO dispute settlement panels are staffed by trade experts, who do not have sufficient expertise in environmental matters or international law to impartially balance the relative interests of trade and environment. Thus, sensitive issues involving the relationships between trade and environmental policies are likely to be resolved in a one-sided way by trade experts who lack expertise in environmental policy and sustainable development.
Moreover, the mandate of the WTO dispute settlement process is only application of WTO rules. Resolving disputes between the POPs Convention and the trade rules will, to be handled properly, require an interpretation of whether the measure at issue is authorized under the POPs Convention – a question of interpreting the POPs Convention, not the WTO rules. Although the WTO may take upon itself the task of interpreting the POPs Convention in this context, it does not have the appropriate expertise to do so.
Disputes between trade rules and environmental agreements are better resolved through the environmental agreement’s dispute settlement process. The POPs Convention will have a dispute settlement mechanism that ought to be the mechanism to resolve any future conflicts between the POPs treaty and the WTO rules. Only the POPs Convention will be able to answer the crucial question of whether a particular trade measure is authorized by the POPs Convention – the crucial factual determination in a dispute with the trade rules.
Expansion of the WTO into additional policy areas is not only bad for environmental policy – it is also bad for the WTO. The multilateral trading systems is in danger of being overloaded through its extension into too many other policy areas. To preserve the integrity of the trading system, its boundaries must be clearly and carefully defined to prevent it from straying into other policy areas – such as environmental policy, or POPs policy in particular. To support expansion of WTO authority into the environmental policymaking arena does a disservice to both environmental policy and trade policy.
The POPs Convention Negotiations are the Right Place to Select the Appropriate Mix of Measures — Trade and Non-Trade — to Achieve the Goal of POPs Elimination
When negotiating a very specific goal – like the elimination of POPs — countries are willing to make compromises and sacrifices, even of trade principles, that they are not willing to make in the abstract. They should be allowed to do so. It was never the intent of the WTO Members in negotiating the trade rules to eliminate forever and under all circumstances the use of trade-related measures to achieve non-trade goals, such as protection of health and the environment.
Ideally, countries will identify a process that negotiators should follow when identifying and fashioning trade-related environmental measures for environmental conventions. POPs negotiators should follow this process to ensure that trade-related measures will not sanction arbitrary or unjustifiable discrimination.
Trade agencies and ministries traditionally wield far greater political leverage than their environmental counterparts. As a result, trade interests are likely to be better represented in environmental fora than environmental interests are to be represented in trade fora. Therefore the POPs negotiations are a better forum than the WTO for selecting the best mix of measures – trade and non-trade – to achieve the goals of the POPs Convention.
The Supremacy Clause is Unnecessary – International Law on Treaty Interpretation Can Resolve any Conflicts between the POPs Convention & other International Agreements
Principles of international law governing interpretation of treaties are available for resolving any disputes that may arise under the POPs Convention with the WTO (or any other international agreement).vii There is no need to provide in advance that the WTO agreement will trump the POPs Convention. If the Parties feel it is necessary to specify how such disputes should be resolved, they should specify that Parties shall seek interpretation of measures implementing the POPs Convention only under the Convention’s own dispute resolution procedures. At the very least, the Convention could provide that parties challenging its implementation under other procedures (such as the WTO’s) must defer to the POPs Convention’s dispute-resolution procedure on the question of whether the measures are truly authorized by the Convention.
The Supremacy Clause Should be Removed from the Draft Text of the Pops Convention
For all the reasons laid out above, the WTO supremacy clause contained in article N bis of the current draft of the POPs Convention should be removed.
i Report of the Second Intergovernmental Negotiating Committee Meeting to Negotiate a Legally Binding Instrument for Implementing International Action on Certain Persistent Organic Pollutants, Annex 1, UN Doc. UNEP/POPS/INC.2/6 (1999).
ii Article N bis.
iii The relevant preambular text reads:
Recognizing that trade and environmental policies should be mutually supportive with a view to achieving sustainable development,
Emphasizing that nothing in this Convention shall be interpreted as implying in any way a change in the rights and obligations of Party under any existing international agreement applying to chemicals in international trade or to environmental protection,
Understanding that the above recital is not intended to create a hierarchy between this Convention and other international agreements.
Rotterdam Convention on the Prior Informed Consent Procedure for Certain Hazardous Chemicals and Pesticides in International Trade, UN Doc. UNEP/FAO/PIC/CONF/5.
iv Protocol to the Convention on Long-Range Transboundary Air Pollution on Persistent Organic Pollutants, UNEP Doc. EB.AIR/1998/2.
v General Agreement on Tariffs and Trade (GATT) art. XX(b) & (g).
vi As a legal matter, environmental agreements have equal status to trade agreements, such as the WTO Agreements. If all the parties to the future POPs Convention were to agree to a rule that conflicted with a WTO rule, then the rules of the POPs Convention would apply between parties to that Convention. Difficulties would only arise if a POPs Convention included measures against a state that is a WTO Member, but not a party to the POPs Convention. Even in such circumstances, however, trade-related environmental measures should not be rejected out of hand.
vii Vienna Convention on the Law of Treaties, 1155 U.N.T.S. 331, entered into force 27 January 1980, arts. 30-38