91998E2443

WRITTEN QUESTION E-2443/98

by Heidi Hautala (V) to the Commission

(30 July 1998)

Subject: Sea turtle

The European Communities (EC) made a third party submission to the World Trade Organisation (WTO) dispute between the United States (US), India, Malaysia, Pakistan and Thailand concerning the US import restrictions on shrimp obtained using fishing methods likely to cause mortality to endangered species of sea turtle. The WTO Dispute Settlement Understanding also entitles the EC to make a public explanation of its position.

Will the Commission now provide such an explanation, in particular, in order to clarify:

1. Why the EC intervened in this dispute?

2. How the EC intervention, which opposes the US embargo, can succeed without being detrimental to the species of endangered sea turtle, which are listed in Appendix I of the Convention on International Trade in Endangered Species (CITES) - a multilateral agreement to which the EC is also a party?

3. Why for the purposes of the WTO general exceptions (Article XX(g)), the EC proposed that it may be appropriate to define "an exhaustible natural resource" as those species protected under the Bonn Convention or listed in CITES Appendix 1 (but not Appendices 2 or 3)?

4. The extent to which it is satisfied with the Dispute Panel's finding against the US?

Answer given by Sir Leon Brittan on behalf of the Commission

(6 October 1998)

1. and 2. By intervening as a third party in the "shrimp-turtle" case, the Commission, on behalf of the Community, aimed at influencing the evolution of case law on General agreement on tariffs and trade (GATT) Article XX in a manner consistent with the Community's policy line on trade and environment, as reflected, in particular, in the Commission communication of February 1996(1).

The Community third party submissions to the panel and to the appellate body are based on the premise that international co-operation, rather than unilateral action, is the most effective and least trade-disruptive means to address global and transboundary environmental problems. Accordingly, the appropriate way for World trade organisation (WTO) members to promote the preservation of globally shared environmental resources, including migratory species, is to come to an internationally agreed solution. This is fully consistent with principle 12 of the Rio Declaration on environment and development.

Moreover, the Community has not excluded the possibility for a WTO member to adopt unilateral trade measures aimed at protecting global environmental resources. However, such a possibility should be subject to certain requirements. In particular, unilateral trade measures would only be acceptable if genuine efforts to develop internationally agreed solutions had previously been made. This is a fundamental issue in the "shrimp-turtle" case since the United States could not demonstrate that they effectively tried to promote conservation of marine turtles through co-operative channels before unilaterally enforcing trade restrictions.

The Commission is convinced that an interpretation of GATT Article XX along the lines suggested by the Community would contribute significantly to achieving a mutually supportive relationship between trade liberalisation and environmental protection objectives. In the first place, the role of co-operative mechanisms as the main instrument to address global and transboundary environmental problems would be clearly recognised in the WTO. Secondly, such an interpretation would provide a strong incentive to achieve broader participation in multilateral environmental agreements.

3. The Honourable Member's question concerning the interpretation of GATT Article XX (g) seems to be based on a misunderstanding. In its third party submission to the panel, the Community invoked the interpretative criteria developed in previous case law (to reject a narrow interpretation according to which only non-living resources or species of a commercial value should be considered as "exhaustible natural resources" under this provision). The Commission is, therefore, of the view that, in principle, the notion of "exhaustible natural resources" in GATT Article XX (g) encompasses all species of fauna and flora, and certainly all species listed in Appendices I, II and III of CITES.

4. The Community is of the opinion that this ruling is likely to enhance the debate on the wider trade and environment relationship in the WTO committee on trade and environment, where the Community has consistently argued that multilaterally agreed measures should benefit from a preferential treatment vis-à-vis WTO rules. Some of the arguments found in the panel report would however require some further clarification by the appellate body.

The Commission believes that the above considerations demonstrate that the Community intervention in this case has been guided by a genuine interest in devising effective solutions to develop a more harmonious relationship between commercial and environmental concerns and to preserve the scope for accommodating trade-related environmental measures in the WTO.

(1) COM(96) 54 final.