The shrimp Turtle Case: a Battleground for the Environmentalists

and the International Trade Community in the WTO

Teshager Worku Dagne

Abstract

The Shrimp-Turtle Case constitutes one of the most important decisions ever decided by the

WTO Appellate Body that touch upon trade and environment issues. The case left analysts with

mixed feelings as far as the relationship between trade liberalization and environmental

protection is concerned. At one hand, it provided some important clarifications in favor of the

right of governments to protect the environment through unilateral measures. On the other hand,

the government taking such measures at the case at hand once again found itself to be in

violation of its World Trade Organization obligations.

This article analyzes and summarizes the comments and explanations on the issues dealing with

the interaction between environmental purposes and trade in the WTO from the perspective of

the various schools of thought, and highlights the issues of due significance for future

researches. Accordingly, it is divided into three sections. The first section provides a brief

introduction on the decision by the WTO Appellate Body in the Shrimp-Turtle Case. In the

second section, discussion is made on the various issues that arose from the case and have

specific relevance to the trade and environment linkage in the WTO. The third section identifies

the position of the different schools of thought on the issues raised, and ends up formulating

questions that need answers in future researches.

 Table of Contents

Title Page

Abstract----------------------------------------------------------------------------------------------------------i

Table of Contents---------------------------------------------------------------------------------------------ii

1.1 Introduction -----------------------------------------------------------------------------------------2

1.2 The Shrimp- Turtle Case ---------------------------------------------------------------------------4

2 Analyzing the Shrimp-Turtle Case ---------------------------------------------------------------------14

2.1 Outstanding Issues Regarding the Shrimp-Turtle Case ---------------------------------------15

2.1.1 “Relating to” vis-à-vis “Primarily aimed at” Requirements ----------------------------------15

2.1.2 Exhaustible Natural Resources -------------------------------------------------------------------19

2.1.3 Extra-Jurisdictionality ----------------------------------------------------------------------------22

2.1.4 Unilateral Measures --------------------------------------------------------------------------------28

2.1.5 The Chapeau Requirements ----------------------------------------------------------------- -----37

2.1.6 Unjustifiable and Arbitrary Discrimination ----------------------------------------------------39

2.2 Theories Applied in the Shrimp-Turtle Case ----------------------------------------------------40

3 Implications of the Shrimp-Turtle Ruling in Determining the Future of Environmental

Measures in the WTO DSB-------------------------------------------------------------------------------49

3.1 The Environmentalists‟ perspective ------------------------------------------------------------------49

3.2 The Trade Communities‟ perspective ----------------------------------------------------------------57

3.3 The Developing Countries‟ Prospective -------------------------------------------------------------60

3.4 Important Issues of Particular Interest to the Trade and Environment Linkage in the WTO-66
 1. Introduction

Before the Tuna/Dolphin rulings, the prevailing view in the WTO was that Art. XX of the GATT

decided any conflicts between free-trade rules and environmental norms in favor of the latter.1

After the GATT Dispute Settlement Panel‟s ruling that a trade embargo on non-dolphin –friendly

tuna was illegal under the GATT rules, international attention was drawn to the impact that trade

rules can have on domestic environmental policies.2 The WTO system has been under serious

attack by environmentalists who believe that its rules have been used to undermine

environmental protection. This led to the creation of the Committee on Trade and Environment

(CTE) at the end of the Uruguay Round in 1994.3

From then onwards, the most fundamental and divisive issue confronting the CTE has been

whether trade restrictions to protect the environment are permissible under the law of the WTO.4

In recent years, tensions between environment and trade policies have significantly increased,

fuelled by a host of trade disputes over issues as diverse as, shrimps, automobiles, furs, or meat

of cattle treated with certain growth hormones.5

1
Robert Howse, The Appellate Body Rulings in the Shrimp/Turtle case: A New Legal Baseline for the
Trade and Environment Debate, (2002) 27 Colum. J. Envtl. L. 493
2
United States-Restrictions on Imports of Tuna, (1991), GATT Doc.DS21/R (1991),39 th Supp. 155BISD,
30 I.L.M. 1594, 50-51

3
The Uruguay Round was a trade negotiation lasting from September 1986 to April 1994 that transformed
the General Agreement on Tariffs and Trade (GATT) into the World Trade Organization (WTO). It was launched in
Punta del Este in Uruguay (hence the name), followed by negotiations in Montreal, Geneva, Brussels, Washington
D.C., and Tokyo, with the 20 agreements finally being signed in Marrakesh - the Marrakesh Agreement.

4
Alexey Vikhlyaev, The use of Trade measures for Environmental Purposes-Globally and in the EU
Context (Sept,2001) 8,Online: UNCTAD Publications <http://r0.unctad.org /trade_env/ test 1/publicati ons/feem>
5
For an overview, see S. Charnovitz, Trade Measures and the Design of International Regimes, (1996),5
Journal of Environment and development , 176
This article deals with the various issues surrounding the WTO‟s Appellate Body ruling in the

Shrimp-Turtle Case. The Case is regarded as the land mark decision in the long standing trade

and environment debate, also marking perhaps the most complicated and convoluted legal

analyses ever rendered.6 The uncertainties arising from this case regarding the interaction

between trade and environment are causing tensions within the multilateral trading system. The

purpose in this article is to congregate, analyze and summarize the host of issues arising from

this case that have due significance in resolving the tumultuous relationship between trade and

the environment.

1.1 The Shrimp Turtle Case

In its May 15, 1998 Report, the WTO Dispute Panel agreed with complaining countries, India,

Pakistan, Malaysia, and Thailand holding that the U.S Section 609 measure is deemed as a

violation of Art. XI of the GATT. The U.S appealed to the WTO Appellate Body. On October

12, 1998, the WTO Appellate Body rejected the U.S attempt to overturn WTO Dispute

Settlement Panel‟s ruling. It had ruled that Washington‟s import ban on shrimp caught in a

manner that allows the bycatch of endangered sea turtles breaches free trade rules. 7 This decision

caused mixed reactions among scholars. Some see the report as furthering environmental

concerns within the GATT jurisdiction, but many complain that the decision merely reflects the

WTO‟s difficulty with environmental issues.

6
Marc Rietvelt, Multilateral Failure: A Comprehensive Analysis of the Shrimp/Turtle Decision, (2005) 15
Ind. Int‟l &Comp. Rev. 474
7
Appellate Body Report, United States –Import prohibition of certain Shrimp and Shrimp Products,
(Oct.12, 1998) WT/DS58/AB/R), (Appellate Body Report) Online: WTO, <http://docsonline.wto. org/DDF
Documents/t/ WT/DS/58 ABR. Doc> [hereinafter Shrimp-Turtle Case]
2 Analyzing the Shrimp-Turtle Case

The importance of the Appellate Body‟s decision in the Shrimp-Turtle Case arises from the

hodgepodge of issues it raised in disposing the dispute. The Appellate Body made detailed

analysis on some of the important trade and environment issues and arrived at a decision

constituting a fundamental departure from the more polarizing previous Tuna/Dolphin rulings.8

Right after the Appellate Body made its final decision in1998, it has encountered some of the

harshest and most scathing criticisms any international law decision has ever faced, both from

the environmentalists and the international trade community. In pursuance of their respective

policies in future Appellate Body‟s decisions, both sides advanced their own arguments that

construe the decision as favoring and disfavoring of trade and environment policies.

2.1 Outstanding Issues Regarding the Shrimp-Turtle Case

As mentioned above, the WTO Appellate Body‟s in the Shrimp-Turtle Case has enunciated a

range of issues. It has analyzed and applied various legal theories intended to dispose the claims

embodied therein. Space doesn‟t permit for the detailed examination of all these issues and

theories. Among the many issues surrounding the case, I have decided to deal with those topics

which I felt, are likely to impact the future of the trade and environment debate in prospective

WTO cases.

2.1.1. “Relating to” vis-à-vis primarily aimed at” requirements

One of the issues concerns the Appellate Body‟s distinction between “the relating to” and

“primarily aimed at” requirements under Art. XX of the GATT. Art. XX provides exceptions for

8
In Tuna/Dolphin Case, the GATT Dispute Settlement Panel ruled that the U.S trade measure even if
intended for environmental purposes, is not legitimate under the GATT. See Supra, note 2
measures that are “necessary” to protect human and animal life and health (XX (b)) and that are

“in relation to” the conservation of exhaustible natural resources (XX (g)).As a result, the test of

compatibility of measures taken under Art. XX (b) of the GATT has been construed in a rather

stricter manner than Art. XX (g). Accordingly, it was established that at least some of

environmental concerns can find their way within the ambit of Art. XX (g) of GATT. Art. XX

(g) of the GATT gives WTO members the right to deviate from their obligations when adopting

measures “relating to the conservation of exhaustible natural resources if such measures are

made effective in conjunction with restrictions on domestic production or consumption”. The

term “relating to” was most likely perceived as too loose by Panels dealing with Art. XX (g) of

the GATT –type measures and consequently, a series of GATT Panels interpreted it to mean the

measure should be “primarily aimed” at the protection of exhaustible natural resources so that

Art. XX (g) of the GATT test is deemed to have been complied with.9 Accordingly, Professor

Mavroides concludes that the words “primarily aimed at” in the body of Art. XX (g) of the

GATT were perceived to impose a burden comparable to that imposed by the “necessity” test in

Art. XX (b) of the GATT. 10

The Panel report on the U.S - Standards for Reformulated and Conventional Gasoline understood

the phrase “relating to” to require that a direct connection be demonstrated between the measure

at hand and the regulatory objective sought and hence, the phrase was construed as requiring

9
See for example, the panel report on Canada-Measures Affecting Exports of Unprocessed Herring and
Salmon, adopted on 22 March 1998, 358/98, pp. 113-115 at Para. 4.4-4.7
10
Petros C. Mavroides, Trade and Environment after the Shrimps-Turtles litigation, (2000), 34JWT, 69
“substantial relationship” between the measure and the conservation of resources .11 The

Appellate Body in the U.S. - Standards for Reformulated and Conventional Gasoline rejected the

legal standard advanced by the Panel, arguing that “the Panel did not try to clarify whether the

phrase „direct connection‟ was being used as a synonym for „primarily aimed at‟ or whether a

new additional element (on top of primarily aimed) was being demanded.”12

In paragraph 140 of the Shrimp-Turtles Case, though the Appellate Body seems to accept

that the direct connection standard is appropriate in the context of Art. XX (g) of the

GATT, the relevant passage reads:

This is, essentially, a requirement that a country adopt a regulatory program

requiring the use of TEDs (Turtle Excluding Devices) by commercial shrimp

trawling vessels in areas where there is a likelihood of intercepting sea turtles. This

requirement is, in our view, directly connected with the policy of conservation of

sea turtles.13

This passage arguably reflects the considered view of the Appellate Body on this issue. In

determining whether the U.S. measures and the objective of conserving sea turtles were

related, it stated that “the U.S legislation is not disproportionately wide in its scope and

11
Appellate Body Report, United States –Reformulated Gasoline, Appellate Body Report, (20 May 1996),
WT/DS2/AB/R, (Appellate Body Report), Online: European Journal of international law website, WTO
<http://www.ejil.org/journal/ Vol9/No1/sr1a.html>, Para. 46

12
GATT, United States – Standards for Reformulated and Conventional Gasoline, Panel Report, WT/DS2/R,
adopted 20 May 1996, modified by Appellate Body Report, WT/DS2/AB/R, DSR 1996:I, 29,
online:OxfordJournals,<http://www.oxfordjournals.org/jielaw/for_authors/official%20wto%20dispute%20settlemen
t%20reports% 20citations.doc> ,Para. 46
13
Supra note 7, Para. 140 (Emphasis mine)
reach in relation to the policy objective of protection and conservation of sea turtles species

and that in principle the means are, reasonably related to the ends.”14

This, according to Dr. Bree, indicates the rejection by the Appellate Body of the GATT

Panel‟s decision in the Standards for Reformulated and Conventional Gasoline and the

Tuna-Dolphin Cases of the “substantial relationship standard” used in determining the

acceptability of environmental related measures.15 If this is the case and the direct

connection requirement is the test of compatibility of a measure with Art. XX (g) of the

GATT, we can conclude that the current standard is more relaxed than the GATT standard.

Consequently, a measure which doesn‟t primarily aim at conservation of natural resources

can still pass the Art. XX (g) of the GATT test if there is a direct connection between the

measure at hand and the sought objective. Mavroides affirms and applauds this as a very

welcome change in the GATT/WTO case law.16 He reasons out that very often, domestic

regulatory processes incorporate environmental objectives although they primarily aim at

other than environmental targets. Such processes will not be automatically struck down by

the WTO adjudicating bodies, if the direct connection requirement can be satisfied.17

Accordingly, Carrie Wofford concludes that the rejection by the Appellate Body of “the

primarily aimed at” test has significantly lowered the threshold that environmental policies

must meet to qualify for Art. XX exception.18 This is a radical approach and enables

14
Ibid. Para 141
15
Axel Bree, Article 20 of the GATT-QUO VADIS? The Environmental Exception After The Shrimp/Turtle
Appellate Body Report, (1999) 17 Dick .J. Int‟l L, 112
16
Supra note 9, 71
17
Ibid.
18
Carrie Wofford, A Greener Future at the WTO: The Refinement of WTO Jurisprudence on
Environmental Exceptions to GATT (2000) 24 Harv. Envtl. L. Rev., 580
environmentally motivated trade measures to easily pass the test under the GATT Art. XX

exception.

2.1.2 Exhaustible Natural Resources

In the Shrimp-Turtles Case, one of the most important issues raised was to what extent turtles

can be considered to be an exhaustible resource. Only if the question was answered in the

affirmative, could the U.S invoke Art. XX (g) of the GATT to justify its measures banning the

imports of shrimps. The complainants argued that the expression “exhaustible natural resources”

applied only to resources incapable of biological reproduction –– petroleum or coal reserves, for

example. This is so because, in the Reformulated Gasoline Case, the Appellate Body has ruled

that clean air was an exhaustible natural resource and also because that the complaints argued for

the term to be interpreted according to the understanding of this term in 1947. 19 The Appellate

Body, rejecting the argument that this term refers to non-living natural resources, held that:

We do not believe that “exhaustible” natural resources and “renewable” natural resources

are mutually exclusive. One lesson that modern biological sciences teach us is that living

species, though in principle, capable of reproduction and, in that sense, “renewable”, are

in certain circumstances indeed susceptible of depletion, exhaustion and extinction,

frequently because of human activities. Living resources are just as “finite” as petroleum,

iron ore and other living resources.20

And later, it asserted that:

Given the recent acknowledgement by the international community of the

importance of concerted bilateral or multilateral action to protect living natural

19
Supra note 11, Para. 22
20
Ibid.
 resources, and recalling the explicit recognition by WTO members of the objective

of sustainable development in the preamble of the WTO Agreement, we believe it is

too late in the day to suppose that Art. XX (g) of the GATT 1994 may be read as

referring only to the conservation of exhaustible mineral or other non-living natural

resources. We hold that, in line with the principle of effectiveness in treaty

interpretation, measures to conserve exhaustible natural resources, whether living or

non-living, may fall within Art. XX (g).21

The Appellate Body noted that the generic term “natural resources” was not static in its content

but rather “by definition evolutionary” and therefore, had to be interpreted within the framework

of the entire legal system prevailing at the time of interpretation.22 It then cited examples from

several multilateral environmental agreements in which the term was used to include living and

non-living natural resource. To support its conclusion that the turtles were “exhaustible,” the

Appellate Body noted that they were listed under CITES as being in danger of extinction.23

In this regard, Howse notes that the Appellate Body was bound to reject the appellant‟s

contention on the meaning of “exhaustible natural resources” due to the creation of a new

interpretive context with the incorporation of GATT 1947 in to the WTO framework in 1994.24

It was able to do this not because Article XX itself has been redrafted in the Uruguay Round, but

because the preamble of the WTO Agreement identified sustainable development as an objective

21
Supra note 7, Para 128-131,(Emphasis in the original)
22
Ibid. Para. 130
23
Ibid. Para. 132
24
Supra note 1, 502
of the Organization and demonstrated that the signatories were aware of contemporary

environmental concerns.25

Dr. Appleton, a prominent international trade law expert, however claims that while the

Appellate Body is to be commended for the sensitivity it has shown to environmental concerns,

previous GATT decisions had already found that animal life is an exhaustible natural resource. 26

He comments that the adoption of an “evolutionary approach” to buttress earlier interpretation of

Article XX (g) was therefore not necessary, and may give rise to interpretive problems.

According to him, the application of an “evolutionary” approach to treaty construction implies

the possibility of altering previous GATT/WTO interpretations and thus could affect the balance

of rights and obligations negotiated by the parties in contravention of DSU Article 19.2.27 He

exclaims that this could pose risks for the predictability of the WTO system.

Mavroides, however, argues that the Appellate Body should have added to its reasoning some

reference to expertise to arrive at an interpretation that “exhaustible” includes also

“reproducible” but a pace slower than what is needed to avoid depletion.28 Be it as it may, the

important point that attracts further considerations in this regard is the Appellate Body‟s

acceptance that the language of Article XX should be interpreted in the light of current

environmental concerns. It is important to note that the Appellate Body indicated a willingness to

25
Supra note 7, Para 129
26
Arthur E. Appleton, Shrimp/Turtle: Untangling the Nets, (1999) 2 J. Int‟l Econ. L. 481, See also Canada
-Measures Affecting Exports of Unprocessed Herring and Salmon, 628, adopted 22 March 1988, BISD 358/98, Para.
4.4; also, supra note Appellate Body Report, U.S-Import Prohibitions of Certain Shrimp& Shrimp Products;
Recourses to Article 21.5 of the DSU by Malaysia, (October 22,2001)WTO Doc. WT/DS58/AB/RW, (Appellate
Body Report) Online: WTO, <www.wto.org /english /tratop_e/dispu_e/distabase_e.htm> ( Shrimp
21.5 herein after) Para. 4.9
27
Ibid. 482, Article 19.2 states that the “Appellate Body cannot add to or diminish the rights and
obligations provided in the covered agreements”.
28
Supra note 10 , 86
balance environmental concerns with the restraints of the GATT rules by interpreting the latter in

the light of relevant international environmental law. As indicated below, however, a number of

questions arise on the exact meaning and the implications of the Appellate Body‟s stance in this

regard.

2.1.3 Extra-Jurisdictionality

Another important issue that the Appellate Body raised but did not decide was whether Art. XX

(g) requires a territorial nexus between the exhaustible resource and the WTO member seeking to

justify its measure. Merely noting that all of the endangered species of turtles could be observed

at one time or another in U.S waters, the Appellate Body stated that were a nexus required, it

existed under these facts.29 However, while it is now clear that Art. XX (g) covers resources that

occur outside a nation‟s territory, the degree of connection required between the country enacting

the measure and the resource in question remains problematic.30

In the previous Tuna/Dolphin case, it was ruled that Art. XX (g) is limited to measures that

conserve resources within the jurisdiction of the party taking such measures.31 The Appellate

Body in the Shrimp-Turtle Case, however, rejected this because sea turtles in the Indian Ocean

are not within the jurisdiction of the U.S.32 However, this portion of the Appellate Body‟s

opinion is of particular interest because it emphasizes the migratory nature of the species in

question. It stated:

29
Supra note 7, Para 155
30
In terms of jurisdictional question, with the exception of the Tuna/ Dolphin case, usually termed as Tuna
I, in which the GATT panel decided that Article XX(g) was intended solely to permit trade measures that did not
aim at extra jurisdictional production and consumption, further GATT decisions in Tuna II indicated that
interpretations have not limited the scope of Article XX(g) to internal environmental issues , United States-
Restrictions on Imports of Tuna, Panel Report, Supra note 33, Para. 891-92
31
Ibid.
32
Supra note 7, Para. 156-157
 The sea turtles species here at stake, i.e., covered by Section 609, are all known to occur

in waters over which the U.S exercise jurisdiction. Of course, it is not claimed that all

populations of these species migrate to, or traverse, at one time or another, waters subject

to U.S jurisdiction…We do not pass upon the question of whether there is an implied

jurisdictional limitation in Art. XX (g), and if so, the nature or extent of that limitation.

We note only that in the specific circumstances of the case before us, there is a sufficient

nexus between the migratory and endangered marine populations involved and the US for

purposes of Art. XX (g).33

The establishment of “sufficient nexus” between the U.S and turtle species in the Indian Ocean

strongly suggests that any jurisdictional limitations on Art. XX (g) in future litigations would be

artificial if it distinguished Shrimp-Turtle as a case that dealt only with migratory species. In this

context, it seems that the Appellate Body has come up with a new approach in extending the

jurisdictional limitation of the GATT exception. However, due to the imprecise argument it

forwarded, it is still questionable as to whether it is laying a new jurisprudential framework

abrogating the previous limitations.

Professor Ilona Cheyne claims that though the Appellate Body applied Art. XX (g) more

liberally than the Tuna/Dolphin Panels, it also imposed a new and ill-defined test of “sufficient

nexus”.34 She argues that this test affects the very well established treaties, including some that

were cited by the Appellate Body in support of its argument that multilateralism is the

33
Ibid. Para. 157
34
Ilona Cheyne, Trade and the Environment: the Future of Extraterritorial Unilateral Measures after the
Shrimp Appellate Body, (2000), 16, Online: Web Journal of Current Legal Issues, < http://webjcli. ncl.ac.uk
/2000/issue5/cheyne5.html
appropriate means to tackle international environmental problems.35 This is so because,

according to her, trade measures introduced to promote protection of the ozone layer or to slow

climate change, or to restrict trade under CITES, may be challenged by WTO members who are

not party to the relevant multilateral agreements for lack of “sufficient nexus”.36 She cites the

Montreal Protocol, which is designed to reduce the threat of damage to the ozone layer, as an

example. This Protocol cannot work unless all parties work together to control trade in ozone-

depleting substances. Yet, the test introduced by the Appellate Body suggests that only those

states directly threatened by ozone depletion might be entitled to use Art. XX (g) in order to

defend their actions under the GATT because these are the states that have “sufficient nexus”

with the problem at hand.37

Howse, however, argues that the requirement of restrictions on domestic production or

consumption makes the issue of whether there is an implicit territorial or jurisdictional limitation

in Art. XX (g) a moot point. He states :

The Appellate Body‟s failure to resolve the question of whether Art. XX (g) has

jurisdictional or territorial limits must be understood in light of the section‟s condition

that unilateral trade measures be taken in conjunction with restrictions on domestic

resource production or consumption. By virtue of this condition, Art. XX (g) already

requires a link between environmental trade measures and domestic regulations dealing

with the same conservation problem. Were a WTO member to target its conservation

concerns solely at the policies of other countries, without putting its own house in order,

then it would not be able to meet this condition of Art. XX (g).The question, then, of

35
Ibid.
36
Ibid.
37
Ibid.
 whether there is an implicit territorial or jurisdictional limitation in Art. XX (g) by its

explicit language only applies to environmental trade measures that are coupled with

domestic environmental regulations.38

Commenting on this argument, however, Professor Condon makes the remark that Howse‟s

argument at this point, though sounds reasonable at first glance, has missed the point.39

According to him, the reason why the issue of territorial nexus is important is not simply due to

concerns over protectionism disguised as environmental measures.40 He claims that jurisdiction

is an important issue because the Understanding on Rules and Procedures Governing the

Settlement of Disputes (DSU), Art. 3(2) requires that WTO rules be interpreted in accordance

with public international law.41 Accordingly, the holding that the U.S had a sufficient

“jurisdictional nexus” for its measure to qualify for provisional justification under GATT Art.

XX (g) is consistent with customary international law in so far as harm to the turtles would have

an effect within its territorial jurisdiction.42 This is so because, according to international law

principles, the territorial basis for jurisdiction is subject to a developing principle of substantial

and genuine connection between the subject matter of jurisdiction, on one hand, and the

territorial base and reasonable interests of the jurisdiction sought to be exercised, on the other.43

The migratory nature of turtles in which the turtles would be in the U.S jurisdiction for a winter

season was regarded by the Appellate Body to establish the required jurisdictional link required

by international law.

38
Supra note 1,504
39
Bradly J. Condon, Environmental Sovereignty and the WTO: Trade Sanctions and International Law
(New York: Transnational Publishers Inc., 2006)168
40
Ibid.
41
Ibid.
42
Ibid.
43
See Ian Brownlie, Principles of Public International Law, 6th ed. , 2003, 297, cited in J. Condon, 169
The general rule that may be derived from the Appellate Body‟s report in this context, according

to Bree, is that a sufficient nexus between the protected subject and a country exists when the

natural resource is at least temporarily within the jurisdiction of the country that invokes the Art.

XX exception, even though the damaging activity takes place outside its territory.44 On this

understanding of the Appellate Body‟s decision, Professor Condon affirms that the measures

aimed at the conservation of transnational or global resources would fall in to the range of

subjects that fit the exception. However, he also argues that measures aimed at the conservation

of resources that only occur outside the territory of the country enacting the measure might also

fit, since the importing country could impose restrictions on consumption of a resource that is not

produced in its territory.45 He cites the CITES convention as an example that effectively imposes

domestic consumption restrictions with respect to endangered species that do not occur inside

their territories.46

Bree goes further and remarks that the Appellate Body‟s rationale in maintaining U.S‟s

extraterritorial measure GATT compatible can be related to the “principle of common concern of

human kind.”47 This principle has its base on the growing consensus that the world is

ecologically interdependent and that humanity has a collective interest in certain activities or

resources, no matter where they take place or where they are located.

Alan Oxely, a former Australian Ambassador to the GATT and Chairman of the GATT

Contracting Parties, agrees that the trade measures may be employed to serve this purpose.

44
Supra note 15, 112
45
Supra note 39, 176
46
Ibid. 178
47
Supra note 15, 112
However, he comments that the ruling in this regard ignores the WTO member preferences that

unilateral trade restrictions with extraterritorial reach should be avoided, and that respect for

national sovereignty should be the guiding principle of international endeavors to improve the

environment and labels this as a worrying precedent having serious implications for the future.48

Generally, the Appellate Body‟s ruling with regard to the extra-territorial effect of the measures

taken under Art. XX (g) seems to impart a laissez-faire approach, as compared to the previous

Panel rulings. The criteria it adopted, however, did not offer a principle on which such questions

might be decided in the future, although the policy-interest linkage is likely to be a crucial issue.

Therefore, a number of questions with regard to the extraterritorial effect of environmentally

motivated trade measure still remain unanswered.

2.1.4 Unilateral Measures

The other and maybe the most important aspect of the debate is the unilateral character of the

measure‟s application.49 Allegedly, recognizing the political sensitivity of striking down an

environmentally-friendly statute in favor of trade,50 the Appellate Body concluded its decision in

the Shrimp-Turtle with a recitation of what it did not decide: “we have not decided that the

sovereign nations that are members of the WTO cannot adopt effective measures to protect

endangered species, such as sea turtles. Clearly, they can and should.”51 In paragraph 121, the

Appellate Body even went so far as to indicate that unilateralism may, in fact, be a common

aspect and application of Art. XX (g):

48
Alan Oxely, Environmental Trade Sanctions: What is at stake? (2002) Feature articles , 46 Online: The
Center for Independent Studies, <http://www.cis.org.au/Policy/summer02-03/polsumm0203-4.htm>
49
John Jackson: “This case is really about unilateralism- One country imposing its view of what is
appropriate for the environment, with out adequate attempt to build multilateral mechanisms,” cited in Julie
Kosterlitz, Shell Game, (1998)30 Nat‟l J. , 2105
50
Supra note 6, 487
51
Supra note 2,Para 185
 It appears to us…that conditioning access to a member‟s domestic market on whether

exporting members comply with, or adopt, a policy or policies unilaterally prescribed by

the importing member may, to some degree, be a common aspect of measures falling

within the scope of one or another of the exceptions... … It is not necessary to assume

that requiring from exporting countries compliance with or adoption of, certain policies

(although covered in principle by one or another of the exceptions) prescribed by the

importing country renders a measure aproiri incapable of justification under Art. XX.

Such an interpretation renders most, if not all, of the specific exceptions of Art. XX

inutile, a result abhorrent to the principles of interpretation we are bound to apply.52

The analysis, however, contains much nuanced sentences. It still raises the question of whether

unilateralism will prevail (even after all the other hoops have been jumped through).53 For this

reason, Professor John Jackson regards the Appellate Body decision on the issue as an evidence

of jurisprudence in process, and hence, according to him, the answer to the question of whether a

unilateral measure can be justified under Art. XX of the GATT is not yet known.54 In this

decision, the Appellate Body has put an end to the long-standing interpretation of the GATT,

according to which conditioning market access to prior acceptance of environmental policies was

in violation of the GATT.55 However, as asserted by Professor Gaines, the practical application

of such an assertion is open for debate for the reasons stated below.56

52
Ibid. Para. 121
53
John Jackson, Comments on shrimp/Turtle and the Product/Process Distinction, (2000) 11EJIL, 306
54
Ibid.
55
Supra note 2, Para 7.15
56
Gains Sanford, The WTO's Reading of the GATT Article XX Chapeau: A Disguised Restriction on
Environmental Measures, (2001) 22 U. Pa. J. Int'l Econ. L. ,743
Even if the Appellate Body recognized the right of WTO member states to impose unilateral

measures under the Art. XX (g) exception, however, it found the U.S. measure illegal because

the measure didn‟t pass the test of the chapeau under Art. XX. It is notable that the Appellate

Body did not necessarily exclude unilateral measures, but that it required serious negotiations

before taking unilateral actions as a last resort. The Appellate Body referred to sections of a

number of MEAs that declare multilateral actions to be the most effective conservation

measures.57 It cited Principle 12 of the Rio Declaration which states that “Unilateral actions to

deal with environmental challenges outside the jurisdictions of the importing country should be

avoided. Environmental measures addressing transboundary or global environmental problems

should, as far as possible, be based on international consensus.”58 It concluded that “the

unilateral character of the application of Section 609 heightens the disruptive and discriminatory

influence of the [measure at stake] and underscores its unjustifiability.”59

On this decision, Professor Trachtman comments that the Appellate Body held open the

possibility that unilateral measures may be crafted in such a way and developed in particular

contexts, in which they might satisfy the requirements of Art. XX.60 Further, he claims that while

the Appellate Body declined to reach a number of important issues, and did not explicitly accept

that a MEA would be a sound basis for an exception under Art. XX, it welcomed environmental

measures, and recommended those that are not unilateral.61

57
These treaties are the 1982 United Nations Convention on the Law of the Sea (UNCLOS), The
Convention on Biological Diversity, the Resolution on Assistance to Developing Countries (adopted in conjunction
with the Convention on the Conservation of Migratory Species of Wild Animals), Convention on International
Trade in Endangered Species of Wild Fauna and Flora ("CITES"), Supra note 7, Para. 130
58
Supra note 7, Para. 123-124
59
Ibid. Para 172
60
Joel P. Trachtman, The Domain of WTO Dispute Resolution, (1999), 40 Harv. Int‟l. L. J, 363
61
Supra note 7, Para, 185-86
Despite this, however, environmentalists have argued that the U.S nevertheless was justified in

acting unilaterally, because there is a broad international consensus for protecting endangered

species.62 On this line of argument, Dr. Bree remarks that the underlying rationale of the holding

is that the unilateral measures are not permissible, because they are not the most effective

possible solutions.63 He maintains that this rational is based on the idea of effectiveness and

proportionality that are non-existent under the language and structure of the chapeau of Art. XX.

He makes the additional comment that multilateral negotiations are usually more time-

consuming and for that reason might be less effective than unilateral measures which can be

adopted immediately.64 Further, arguing that they can be seen as an interim solution until a

multilateral agreement is concluded, or as incentive to convene multilateral negotiations, he tries

to secure a room for unilateral measures.65 In relation to this, Kibel argues that demanding

multilateral negotiations prior to taking unilateral action ignores the fact that unilateral measures

have in the past often been the impetus for international agreements.66

The Appellate Body reconfirmed its preference for measures taken under international

agreements over measures taken unilaterally in the shrimp 21.5 decision too. It, however, upheld

a unilateral measure because serious efforts to conclude an international agreement had failed. It

endorsed negotiated agreements as the preferred means of solving environmental problems and

considered this as “a principle that was central” to its decision.67

62
Supra note 49, 2105
63
Supra note 15,125
64
Ibid.
65
Ibid. 126
66
Ibid.
67
Supra note 26, Para.138
Neuling asserts that this finding makes it unlikely that future Panels will overturn measures taken

pursuant to MEAs, at least in any disputes between two parties.68 According to him, the Panel

might treat the MEA as evidence of an international standard and render the trade measure

justifiable and non-arbitrary within the meaning of Art. XX. He claims that the Appellate Body

has done this by relying on non-WTO convention as “factual reference” in its holding that to

avoid “arbitrary or unjustifiable discrimination” in the sense of the chapeau of GATT Art. XX,

the U.S. had to provide all exporting countries “similar opportunities to negotiate” an

international agreement.69 The WTO Panel has affirmed this stating “the Inter- American

Convention [for the protection and Conservation of Sea Turtles, in force as of 2 May 2001] can

reasonably be considered as a benchmark of what can be achieved through multilateral

negotiations in the field of protection and conservation”70

On appeal, the Appellate Body approved the Panel‟s reliance on the Inter-American Convention

saying:

The Panel rightly used the Inter-American Convention as a factual reference in this

exercise of comparison [as between U.S. efforts to negotiate the Inter- American

Convention with one group of exporting countries and US efforts to negotiate a similar

agreement with another group of exporting countries, including the complainant

Malaysia].71

68
Bruce Neuling, The Shrimp-Turtle Case: Implications for Article XX of GATT and the Trade and
Environment debate, (2000) 22 Loy. L.A. Int‟l & Comp. L. Rev., 44
69
Supra note 7, Para. 122
70
Panel report, United States - Import Prohibition of Certain Shrimp and Shrimp Products, (15 May 1998)
WTO Doc.WT/DS58/R Para. 98), (Panel report), Online: Foreign Trade Information System, < http://www. sice.oas
.org /DISPUTE/wto/58r00/shrius.asp>, Para. 57
71
Supra note 7, Para. 124
Criticizing this decision, Professor Gaines states that, while the Appellate Body‟s decision in the

Shrimp-Turtle Case appears to open the door to unilateral national environmental measures

under Art. XX (g), that open door only leads to a second and more tightly guarded gateway, the

Art. XX chapeau.72 He, then, concludes that the arguments for earlier cases condemning

unilateral measures under Art. XX seem to have merely transferred bases from the interpretation

of the exceptions to the interpretation of the chapeau.73

In contrast to these criticisms, however, Carrie Wofford argues that the Appellate Body‟s

decision affirmed that unilateral environmental policies are not only legitimate, but also to be

expected under Art. XX exceptions.74 By requiring multilateral negotiations, she argues that the

Appellate Body lowered the legitimate threshold that unilateral environmental policies will face

in future WTO cases.75 She notes that the Appellate Body‟s straightforward suggestion in the

Shrimp-Turtle that unilateral environmental policies are both “a common aspect” and “to be

expected” contrasts the strong opposition to unilateral environmental policies voiced by earlier

Panels. She applauds the Appellate Body‟s decision, claiming that the Appellate Body‟s

openness to unilateral environmental policies, through its embrace of the text of Art. XX‟s

environmental exceptions, is a welcome shift in jurisprudence for environmentalists.76

A point worth considering in relation to the Appellate Body‟s decision in this regard is its

criticism on U.S for “failure … to engage …other members exporting shrimp to the U.S, in

serious, across-the-board negotiations with the objective of concluding bilateral or multilateral

72
Supra note 56 ,743
73
Ibid.
74
Supra note 18,581
75
Ibid.
76
Ibid. 582
agreements for the protection and conservation of sea turtles, before enforcing the import

prohibition against the shrimp exports of those other members.”77 On this line of reasoning, the

Appellate Body might reject the measure as unjustifiable, unless the importing nation made

serious efforts to encourage the non-party to join the MEA prior to the imposition of the

measure.

Howse opposes this stance arguing that there is nothing in the wording of the chapeau (or any

other part of Art. XX) to suggest that a nation must first secure agreement by WTO members or

any other nation before exercising its rights under Art. XX (g).78 While agreeing to this assertion,

Condon, however, argues that Howse‟s argument holds for some kinds of unilateral actions

only.79 As an example, he mentions that Art. XX (e) permits trade restrictions relating to the

products of prison labor and Art. XX (f) permits trade restrictions imposed for the protection of

national treasures of artistic, historic or archaeological value. According to him, neither category

appears to require the prior negotiation of a multilateral agreement as Art. XX (e) and (f)

themselves may be considered an agreement to permit such restrictions.80 This is so because the

measures to be taken under Art. XX (e) and (f) are specific and narrowly bounded, compared to

the more general and (and ambiguous) language contained in Art. XX (b) and (g).81 As such, he

concludes that measures taken pursuant to the Art. XX (b) and (g) exceptions would not be

unilateral at all and to inquire as to whether there is a duty to negotiate prior to imposing

unilateral measures under the other headings is a red herring.82

77
Supra note 7, Para 166
78
Supra note 1, 510
79
Supra note 39, 174
80
Ibid.
81
Ibid.
82
Ibid.
Howse however, argues that negotiation efforts in the Shrimp-Turtle Case were only relevant to

determining under the chapeau whether the U.S had discriminated between the countries around

the Indian Ocean and the countries in the Americas. According to him, negotiation efforts were

only one of the several factors that determined the outcome of this analysis, rather than a

decisive factor.83 Condon, however, maintains that even efforts to negotiate may be essential to

justify a unilateral measure under Art. XX (g).84

Another problem that Simmons and other academics point out with regard to the Appellate

Body‟s decision for the undertaking of negotiations prior to taking unilateral action under Art.

XX refers to the “attempt to negotiate”. Though the Appellate Body criticized the U.S for failing

to make a “serious attempt” to achieve an international consensus, the extent to which a country

must attempt to negotiate multilateral solutions remains uncertain.85 For example, it is unclear

whether an unsuccessful attempt to negotiate will satisfy the requirement. Neuling also raises the

same concern and comments that it is questionable how a Panel would view a measure taken

pursuant to an MEA, but against a non-party that was engaged in unsuccessful negotiation.86

After analyzing the difficulties involved in the Appellate Body‟s requirements to legitimize the

U.S. measure, Eric Richards and Martin McCrory, conclude that as a result of these

requirements, it is “permissible for a country to adopt unilateral measures” only “in rare

circumstances.” 87

83
Supra note 1, 507
84
Supra note 39, Page 173
85
Benjamin Simmons, In search of Balance: An analysis of the WTO Shrimp/Turtle Appellate Body Report,
24 Colum. J. Envtl. L. 1999, 444
86
Supra note 68, 44
87
Eric L Richards. & McCrory A. Martin, The Sea Turtle Dispute: Implications for Sovereignty, the
Environment, and International Trade Law, (2000) 71 U. Colo. L. Rev.340-41
As the above analysis indicates, the Appellate Body‟s position on unilateral measures on

environmental grounds is compounded with many complications. Intense arguments are still

going on what the Appellate Body decided and what it didn‟t with regard to unilateralism. More

specifically, the Appellate Body‟s reasoning leaves considerable uncertainties about the test for

the legality of unilateral measures and the significance of multilateral agreements in justifying

unilateral trade measures. Its legal reasoning is sufficiently ambiguous that it is nearly impossible

to predict how trade-environment disputes may be resolved in the future. However, resolving the

quandary in this regard serves a vital role in determining the fate of environmentally motivated

trade measures and the place of environmental agreements in the WTO system.

2.1.5 The Chapeau requirements

Another key decision by the Appellate Body is the finding that the U.S measure met the

requirements of Art. XX (g), but not the chapeau. In the chapeau under Art. XX of the GATT,

the words “discrimination between countries where the same conditions prevail” and “disguised

restrictions on international trade” provide little guidance on what conditions are relevant or

what constitutes a disguise. Accordingly, the Appellate Body in the Shrimp-Turtle Case focused

on the manner in which a measure is applied, rather than the content of the measure.

In defining the role of the chapeau, the Appellate Body focused on the theme of reasonableness.

It stated:

The chapeau … is, in fact, but one expression of the principle of good faith… One

application of this general principle, the application widely known as the doctrine of

abuse de driot, prohibits the abusive exercise of a state‟s rights and enjoins that whenever
 the assertion of a right “impinges up on the field covered by a treaty obligation, it must be

exercised bona fide, that is to say, reasonably.88

The Appellate Body broke down the chapeau analysis to first ask whether a measure is applied in

a manner that constitutes “arbitrary or unjustifiable discrimination between countries where the

same conditions prevail,”89 An important point that the Appellate Body embarked on its analysis

of this issue is its reading of the chapeau as requiring an effort at international cooperation. We

shall first see its analysis with regard to the chapeau requirements.

2.1.6 Unjustifiable and Arbitrary Discrimination

The Appellate Body found that the American regulation failed the chapeau test that the measure

should not constitute “arbitrary or unjustifiable discrimination” for four reasons. First, the

regulations required the WTO members to adopt “essentially the same policy” as that applied in

the U.S without taking in to account other policies and measures a country may have adopted

that would have a comparable effect on sea turtle conservation.90 Second, the U.S applied the

same standard without taking into consideration whether it was appropriate for the conditions

prevailing in other countries.91 Third, the U.S failed to engage in “serious, across-the-board

negotiations with the objective of concluding bilateral or multilateral agreements for the

protection and conservation of sea turtles, before enforcing the import prohibition.”92 Fourth, the

U.S pursued negotiations with countries in the Americas but not in South and Southeast Asia and

gave the former three years to adopt TED requirements while the latter had only four months. In

this regard, it concluded that having successfully negotiated the Inter-American Convention, the

88
Supra note 7, Para. 158
89
Ibid. Para, 150
90
Ibid. Para 163
91
Ibid. Para165
92
Ibid. Para 166
U.S had demonstrated that there was an alternative course of action reasonably available to

achieve its goal of turtle conservation.93

As regards the issue of arbitrary discrimination, the Appellate Body found that “lack of

flexibility embodied in the American requirement to adopt essentially the same policy without

consideration for differences in prevailing conditions constituted not only unjustifiable, but also

arbitrary discrimination.”94 It also held that the lack of transparency in the certification process

through which U.S officials determined whether a country could be exempted from the import

ban constituted arbitrary discrimination.95 There was no opportunity for the applicant country to

be heard, no opportunity to respond to arguments made against it, no notice given of a negative

decision, no reasons provided for the decision, and no procedure for review or appeal.96

Therefore, it concluded that the lack of due process in the denial of certification constituted

arbitrary discrimination compared to those who were granted certification.97 The decision by the

Appellate Body on this point has, as indicated above, been seriously attacked by

environmentalists for raising the standard of review of the chapeau, thereby closing the door on

member countries‟ ability to initiate the much needed unilateral environmental measures.

So far, we have been dealing with the specific issues that have formed a ground of analysis for

the Appellate Body‟s finding the U.S measure illegal. Underlying the legal reasoning in all these

and the other issues is the theory it adopted to resolve the dispute. I will now turn to examining

the bunch of literature on the theory adopted in the Shrimp-Turtle Case.

93
Ibid. Para164
94
Ibid. Para 177
95
Ibid. Para 104
96
Ibid.
97
Ibid. Para 181
2.2 Theories Applied in the Shrimp-Turtle Case

There exists a spectrum of views about the extent to which the WTO system is, and should be,

integrated in to the broader body of international law. At one end of this spectrum is the view

that the WTO and its dispute settlement system is essentially a closed system that is independent

of public international law rules and principles.98 This view considers the WTO legal system as a

“closed” or “self-contained” regime. A “self- contained regime” is a subsystem of international

law intended to exclude the application of other legal consequences more or less, totally.99

Accordingly, academics from this school of thought are critical of the Appellate Body‟s use of

outside legal rules and obligations to interpret the WTO texts, limiting the applicable law to

WTO covered agreements only.100

At the other end of the spectrum is the view that WTO Panels can refer to in principle, all valid

and legal international law binding on the disputing parties, in order to decide on a WTO

claim.101 This view portrays international law as a “system” of international law in the sense of

an “operating system” within which treaties, custom and international organizations maintain a

minimum of coherence and interaction between the different branches of international law.102

Within the system, states are presumed to enforce their treaty obligations in good faith. The good

faith principle implies that states are presumed to have negotiated all their treaties taking into

98
G. Marceau, A Call for Coherence in International Law: Praises for the Prohibition against ‘Clinical
Isolation’ in WTO Dispute Settlement, (1999)33 J. of World Trade , 107
99
J. Combacau and D. Alland, Primary and Secondary Rules in the Law of State Responsibility:
Categorizing International Obligations, (1985),47 Netherlands Year Book of International Law, 117
100
Joseph Weiler, The Rule of Lawyers and the Ethos of Diplomats : Reflections on the Internal and
External Legitimacy of Dispute settlement, in Roger Porter, Pierre Sauve, Arvind Subramanian and Americo
Zampetti(eds.), Efficiency, Equity, and Legitimacy: The Multilateral Trading System at the Millennium (Washington
: Brookings Institution Press, 2001), 337) See list of WTO covered agreements, Infra, note 138
101
Supra note 98, 107
102
Joost Pauwelyn, Fragmentation of International Law, Para 34, Online < http://www.law.duke
.edu/fac/pauwelyn/pdf/fragmentation_of_international_law.pdf>
account all their other international law obligations (general principles, custom and treaty

obligations).103 In this sense, States‟ obligations are cumulative. Accordingly, they should be

interpreted taking in to account other relevant and applicable rules between the same parties,

with a view to avoiding conflicts with other relevant rules of international law applicable to the

relations between the same countries.104

The precedent the Appellate Body laid on this issue remains a point of divergence among the two

schools of thought. First, because the Appellate Body has not formulated a coherent legal reason

to justify its use of other agreements and law to interpret WTO obligations. Second, because

some WTO members have questioned its view on the use of non-WTO law persistently.

Some academic commentators argue that the Shrimp-Turtle Case stands witness to the increased

openness of the WTO regime to other branches of international law, in particular international

environmental law.105 Among the various reasons raised to strengthen the Appellate Body‟s

application of this uniting theme is its adoption of the “evolutionary interpretation” of the phrase

“exhaustible natural resources”. In making this decision, it stated:

The words of Art. XX (g), “exhaustible natural resources”, were actually crafted more

than 50 years ago. They must be read by the treaty interpreter in the light of

103
Gabrielle Marceau, Conflicts of Norms and conflicts of Jurisdictions: The Relationship between the
WTO Agreement and MEAs and Other Treaties, (2001) 35 J. of World Trade, 1088
104
Ibid.
105
Joost Pauwelyn being the major advocate of this idea, there are other academicians arguing this way,
See Joost Pauwelyn, Conflict of Norms in Public International Law, (Cambridge: Cambridge University Press,
2003), 484. See also David Palmeter and Petros Mavroidis, The WTO Legal System: Sources of Law (1998) 92
AJIL, P.398, Lorand Bartels, Applicable Law in WTO Dispute Settlement Proceedings, (2001), 35 J. of World
Trade, P. 511. Contra: G. Marceau, A Call for Coherence in International Law: Praises for the Prohibition against
‘Clinical Isolation’ in WTO Dispute Settlement, (1999)33 J. of World Trade, 109-115, L.D. Guruwamy, Should
UNCLOS or GATT/WTO Decide Trade and Environment Disputes? (1998) 7 Minn.J. Global TradeP.311 Joel
Trachtman, The Domain of WTO Dispute Resolution, (1999) 40 Harv. Int‟l L.J , 342 )
 contemporary concerns of the community of nations about the protection and

conservation of the environment…. From the perspective embodied in the preamble of

the WTO Agreement, we note that the generic term “natural resources” in Art. XX (g) is

not “static” in its content or reference but is rather “by definition, evolutionary”.106

Accordingly, the Appellate Body used non-WTO law (other international law)107 to interpret the

phrase in accordance with the “customary rules of interpretation of public international law”

referred to in Article 3.2 of the DSU. The use of these treaties to interpret WTO provisions has

been construed as recognition of the harmonizing approach to international law, making other

non-WTO conventions applicable before the WTO Panel.108 For example, Jackson argues that

the language in the Shrimp-Turtle Case follows the international law approach described

above.109 He substantiates his contention by quoting the Appellate Body‟s decision that “the

various conventions that incorporate environmental policies are part of the interpretive material

that the Panels and the Appellate Body should use.”110

Another argument on this school of thought relates to the decision by the Appellate Body that

referred to an international agreement concluded by the U.S (the Inter-American Convention for

the Protection and Conservation of Sea Turtles). In this regard, Dr Lorand Bartels makes the

argument that the Appellate Body used this international convention as evidence that other

courses of action were reasonably open to the U.S and therefore its actions constituted “arbitrary

or unjustifiable discrimination”.111 He argues that in this regard, the Appellate Body used

106
Supra note 7, Para. 129
107
See the list of these non-WTO agreements, Supra note 57
108
Supra note 105, 461
109
Supra note 53, 306
110
Ibid.
111
Lorand Bartels, Applicable Law in WTO Dispute Settlement Proceedings, (2001) 35 J. World Trade, 511
international law as evidence of a party‟s compliance with its obligations under the WTO

covered agreements.112 Pauwelyn agrees to this and claims that in this situation, the non-WTO

Convention played a role, not as a set of norms part of the law applicable to the dispute (as has

been suggested by the harmonizing view described above), but as a factual benchmark to gauge

whether the U.S had engaged in “comparable negotiations” as required under GATT Art. XX.113

The significance of applying non-WTO rules as “facts” arises in defending trade restrictions

prescribed by environmental convention against nonparties. Even if those nonparties (however,

members of WTO) are not legally bound by the convention and a WTO Panel could therefore not

apply this non-WTO rule, the convention could nonetheless constitute strong support for the

defendant‟s contention that the trade measure is “necessary” pursuant to GATT Art. XX (b).114

An important question arising from the decision of the Appellate Body in this regard is; if the US

can be absolved under GATT Art. XX by concluding a MEA with Malaysia (in which both states

agree, for example, on the imposition of certain trade restrictions), would this imply that once

such MEA is concluded, the U.S can also rely on it as a legal defence against any future WTO

claim that Malaysia may bring? Indeed, if Malaysia were to bring a WTO complaint subsequent

to the entry in to force of the MEA, targeted at the very trade restrictions agreed on in this MEA,

should the U.S be permitted to invoke this MEA as a defence also before a WTO Panel, in

112
The WTO covered agreements are: (A) Agreement Establishing the World Trade Organization, (B)
Multilateral Trade Agreements, Annex 1A: Multilateral Agreements on Trade in Goods, Annex 1B: General
Agreement on Trade in Services , Annex 1C: Agreement on Trade-Related Aspects of Intellectual Property Rights ,
Annex 2: Understanding on Rules and Procedures Governing the Settlement of Disputes, (C) Plurilateral Trade
Agreements, Annex 4: Agreement on Trade in Civil Aircraft, Agreement on Government Procurement, International
Dairy Agreement, International Bovine Meat Agreement, read Understanding on Rules and Procedures Governing
the Settlement of Disputes, Apr. 15, 1994, appendix 1,
113
Supra note 105, 464
114
Ibid. 463
addition to the MEA compliance Panel? Pauwelyn, arguing in line with the harmonizing view of

international law described above, gives an affirmative reply to these queries and concludes that

non-WTO rules can play a role not only as a factual reference, but also as a valid legal

defence.115

The arguments forwarded by other commentators arguing for reining in the application of non-

WTO laws in the Appellate Body, however, do not suggest concurrence with these conclusions.

A representative authority in this regard is Professor Trachtman who maintains that “the mandate

of WTO Dispute Settlement body is clear: apply (directly) only the WTO law.116

He argues that several provisions of the DSU provide this limitation:

Art. 3.2 provides that the dispute settlement system “serves to preserve the right and

obligations of members under the covered agreements and to clarify the existing

provisions of those agreements in accordance with the customary rules of interpretation

of public international law.” Art. 3 .2 further provides that “recommendations and

rulings of the DSB cannot add to or diminish the rights and obligations provided in the

covered agreements.” This language would be absurd if rights and obligations arising

from other international law could be applied by the DSB. The standard Panel terms of

reference provided under Art. 7 provides for reference only to law arising from the WTO

agreements.117

115
Supra note 105 465
116
Supra note 60, 342
117
Ibid.
Moreover, it is argued that Art. 11 of the DSU specifies the function of Panels to assess the

applicability of and conformity with the covered agreements.118 With so much specific reference to

the covered agreements as the law applicable in WTO dispute resolution, it would be odd if the

members intended non-WTO law to be applicable.119 By citing previous Panel decisions to

strengthen his position, he concludes that the role of non-WTO laws is limited only to two

circumstances: first, for interpretive purpose as specifically authorized by Art. 3.2 of the DSU,

which doesn‟t include substantive non-WTO law.120 Second, only when the substantive non-WTO

law is incorporated by reference in WTO law such as the reference made in TRIPS to intellectual

property treaties.121

Along the same line of argument, Marceau claims that sound policy militates against permitting

WTO Panels and the Appellate Body to enforce outside obligations.122 He makes the point that

while the WTO should ensure that its interpretation and application of WTO rules are consistent

with public international law, permitting it to enforce outside rules by providing remedies for

breach of public international law would threaten to overload the multilateral trading system.

Further, he argues that the application of non-WTO law in the WTO system may avert focus from

the need to improve dispute resolution and enforcement in other sub-systems of international law,

such as the MEAs.123

118
Understanding on Rules and Procedures Governing the Settlement of Disputes, Apr. 15, 1994, art. 7
119
Supra note 60, 342
120
Ibid.343
121
Ibid.
122
Supra note 104, 111
123
Ibid.
The existence of divergent views on the relationship between WTO- covered agreements and the

non-WTO laws, coupled with the ambiguity in the Appellate Body‟s reasoning leaves the issue

unresolved. This calls for further researches and investigations on the jurisprudence and the

international rules, and spell out the contours of the arguments on both sides.

As indicated above, those are the main issues surrounding the recent Shrimp-Turtle Case decision

by the WTO Appellate Body. Its stand on each of those issues has led it to arrive at the final

decision disallowing the U.S from implementing its trade measure against the shrimp imports from

India, Pakistan and Malaysia. The final report is not easy to categorize from a trade and

environment prospective. Depending on one‟s understanding of the issues raised and the reasoning

it went through, the general allusion of the case is construed in differing ways. In the following

chapter, I will try to summarize the range of opinions in this regard.

3. Implications of the Shrimp-Turtle Ruling in Determining the Future of

Environmental Measures in the WTO DSB

The implications of the case within the larger scope of the trade-environment debate have been

the subject of opinion both on the environmental and international trade communities. On the

environmentalists‟ side, the Appellate Body‟s decision was met with both relief and

disappointment. Although they were relieved that the extreme positions taken by the Dispute

Panel were rejected, they were disappointed that yet another environmental protection law was

not fully protected by Art. XX. They questioned whether any law with an important

environmental goal could sustain a WTO challenge. On the other hand, the trade communities, in

camaraderie with critics from the developing countries, berate the Appellate Body‟s stand in

laying what they characterized as a harmful jurisprudence that threatens to undermine the goals
of the trading system. The following pages are devoted to the treatment of the range of

deliberations in this regard. I will begin by examining the merits of the decision that

environmentalists consider as welcoming environmental policies.

3.1 The Environmentalists’ Perspective

The environmentalists, despite their disappointment for the actual outcome of the case, praise the

Appellate Body‟s decision for reversing the age old view that environmentally motivated

measures cannot sustain the WTO‟s approval. They count a number of issues that they think will

ensure the WTO DSB will not reject future trade measures taken in pursuance of environmental

objectives embodied in MEAs.

According to Pauwelyn, the Appellate Body‟s interpretation of the GATT Art. XX through the

lens of the WTO‟s Preamble is one of such areas. By doing so, he argues that the Appellate Body

took a significant step towards ensuring that GATT is interpreted consistently with evolving

principles of international environmental law.124 It made use of the GATT Preamble, which

explicitly acknowledges “the objective of sustainable development” and the importance of

protecting and preserving the environment.125 This approach led the Appellate Body to conclude

that Art. XX is “not static in its content or reference but is rather by definition, evolutionary.” It

stated:

The words of Art. XX (g), “exhaustible natural resources” were actually crafted more

than 50 years ago. They must be read by a treaty interpreter in the light of contemporary

concerns of the community of nations about the protection and conservation of the

environment…. From the perspective embodied in the preamble of the WTO Agreement,

124
Supra note 105, 485
125
Supra note 7, Para. 155
 we note that the generic term “natural resources” in Art. XX (g) is not “static” in its

content or reference but is rather “by definition, evolutionary.” 126

The Appellate Body‟s interpretation of the requirements of Article XX in this manner, it is

argued, lowers the bar that environmental policies must clear.127 Moreover, by embracing future

use of Article XX for unilateral policies and by articulating a contemporary understanding of

“exhaustible natural resources,” that includes living resources, the Appellate Body has opened

the door to greater use of Article XX‟s environmental exceptions.128

He also argues that the Appellate Body has laid the jurisprudence that even though a particular

MEA provision may not be legally binding on all WTO members, or not even on all disputing

parties in a particular case, such an agreement may still play a role under Art.31 of the Vienna

Convention.129 This happens if it can be said to reflect the “common intentions” of WTO

members, or if it can be said to reflect the “ordinary meaning” of a WTO treaty term. 130 This was

arguably the case when the Appellate Body referred to certain treaties that were not binding even

126
Ibid.
127
Supra note 18, 583
128
Supra note 105, 464
129
The Vienna Convention reads: Article 31 (1) A treaty shall be interpreted in good faith in accordance
with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and
purpose.(2) The context for the purpose of the interpretation of a treaty shall comprise, in addition to the text,
including its preamble and annexes:
a)any agreement relating to the treaty which was made between all the parties in connection with the
conclusion of the treaty;
b) any instrument which was made by one or more parties in connection with the conclusion of the treaty
and accepted by the other parties as an instrument related to the treaty.
(3) There shall be taken in to account together with the context:
a) any subsequent agreement between the parties regarding the interpretation of the treaty or the application
of its provisions;
b) any subsequent practice in the application of the treaty which establishes the agreement of the parties
regarding its interpretation;
c) any relevant rules of international law applicable in the relations between the parties.
(4) A special meaning shall be given to a term if it is established that the parties so intended. The Vienna
Convention on the Law of Treaties, signed at Vienna, Austria 23 May 1969, Online:
<http://72.14.203.104/search?q=cache:TZZtDdNpikJ:www.worldtradelaw.net/misc/viennaconvention.pdf+The+Vie
nna+Convention&hl=en&ct=clnk&cd=1>
130
Supra note 105, 465
on the disputing parties, let alone on all WTO members.131 Pauwelyn argues that, though the

Appellate Body remained silent as to the legal basis for this reference to non-WTO treaties, the

non-WTO treaties it referred to, though not legally binding on all WTO members, reflected the

“common intentions” of all WTO members and/or the “ordinary meaning” of the term

“exhaustible natural resources” as is used in Art. XX (g) of GATT 1994.132 This is an essential

point in setting the precedent for the applicability of MEAs in resolving future disputes in the

WTO.

Due to these and the other positive environmental features with regard to unilateral trade

measures and extraterritoriality as well as the laxity it goes through in determining the “direct

connection” test discussed above, the Shrimp-Turtle decision was warmly welcomed by green

NGOs. For this reason, many academic commentators from the environmental side consider it as

the most important systematic case decided in the WTO so far.133

Despite this, however, the decision is not lacking criticisms and commentary from other

environmental communities. Most legal comments thus far have exhaustively focused on the

perceived overbroad, or depending on one‟s point of view, overly narrow, and substantively

incorrect interpretation of the WTO‟s Art. XX chapeau.134 For example, right after the Appellate

131
See the list of these treaties, Supra note 57
132
Supra note 105, 245
133
Supra note 6, 303-7
134
Marlo Pfister Cadeddu, Turtles in the soup? An analysis of the GATT Challenge to the United States
Endangered Species Act Section 609 Shrimp Harvesting Nation Certification Program for the Conservation of Sea
Turtles, (1998)11 Geo Int‟l Envtl. L. Rev. , 27
Body‟s decision, the National Wildlife Federation (NWF) announced that it was “seriously

concerned” about the impact of the WTO case.135 It stated:

Since the Appellate Body found that the language of the law itself falls within the

boundaries of the exceptions allowed to trade rules, they have opened the door for a

country to take strong measures to protect shared global resources such as sea turtles.

Yet, with their analysis of the implementation of the law, the WTO has also established a

stringent requirement that countries implement a conservation law perfectly in order for it

to be allowed by the WTO.136

The NWF was most concerned about the difficulties the opinion might cause for future attempts

to protect the environment through the use of trade measures. It wrote:

Sometimes, it is impossible to negotiate with all countries when trying to protect a

species on the verge of extinction. Sometimes timing or political situations necessitate

that one country take the lead in promoting comprehensive environmental protections.

Although they did it imperfectly, the U.S government made a good faith effort to protect

endangered sea turtles around the world from death in shrimp nets. While efforts by one

country are not enough, and are not the ideal solution to international environmental

problems, sometimes, in cases such as this one where an entire life form is threatened,

they are necessary.137

The NWF is expressing the concern that the Appellate Body‟s strong suggestion that

international negotiations precede the imposition of environmental trade measures could limit the

135
National Wildlife Federation, Breaking News: WTO Appellate Body Strikes Down U.S. Turtle
Protection for the Last Time, in Bruce Neuling, The Shrimp-Turtle Case: Implications for Article 20 of GATT and
the Trade and Environment Debate, (1999), 22 Loy. L.A. Int‟l &Comp. L. Rev. , 42
136
Ibid.
137
Ibid.
ability of the WTO members to act quickly and unilaterally to protect the environment.138 This is

so because; usually, comprehensive treaties can take years to negotiate. Hence, according to the

NWF, the decision in this regard might impede environmental protection.

Another concern environmentalists raise in relation to the Shrimp-Turtle Case relates to the

suggestion by the Appellate Body that the U.S government should not exclude shrimp caught

with TED simply because the exporting country was not certified.139 This, according to the

critics, implies that the U.S government is wrong to concern itself with the practices of all shrimp

fishermen in a foreign country. Instead, it should focus only on those who export to the U.S.140 If

this reading is correct, a foreign country could adopt to a U.S trade measure without requiring all

of its producers to change their practices. Only those who trade with the U.S would need to

conform. This obviously limits the ability of the U.S environmental measure to influence

environmental practices abroad by denying access to its huge market.141 Moreover, from the

standpoint of enforcement, it is far simpler to determine whether or not a country has imposed a

TED regime (or some other scheme) on all of its shrimp fishermen.142

The other concern is the fear that the future of Art. XX litigation could be significantly affected

by the Appellate Body‟s conclusion that a trade measure is “arbitrary” if the exporting nation is

not given due process rights, such as prior notification, an opportunity to be heard, written

findings, rights of appeal, and so forth.143 It is feared that greater due process in this regard will

138
Ibid.
139
Supra note 7, Para 138
140
Ibid
141
Ibid.
142
Supra note 134,44
143
Supra note 135, 48
result in a more rational application of laws containing trade measures. However, it will also give

WTO members endless opportunities to challenge environmental trade measures imposed by

other members.144

Some have even concluded that the WTO, as an arbiter of international law and jurisdiction,

failed to properly heed pertinent authority and customary international law in deciding Shrimp-

Turtle and other decisions.145 They assert that the WTO should have affirmed that trade-related

environmental measures authorized under internationally recognized environmental principles

and customary law are consistent with WTO rules.146 In particular, the critics argue that the

application of sustainable development as a legal concept was conveniently ignored in the

Appellate Body‟s Shrimp-Turtle ruling.147 They blame the Appellate Body for ignoring a well-

established, overarching international environmental standard-the principle of sustainable

development-that exists with or without a treaty on point.148 Such “oversights” have tempted

some commentators to agitate for a more neutral forum and arbiter of international trade-

environment issues.149

Bret Puls adds to this criticism holding that the Dispute Panel and Appellate Body reports bend

the text of GATT in order to find extraterritorial unilateral regulations per se invalid because

144
Ibid.
145
Supra note 6, 475
146
Ibid.
147
Ibid.
148
Virginia Dailey, Sustainable Development: Reevaluating the Trade vs. Turtles Conflict at the WTO,
(2000) 9 Transnat‟l L. & Pol‟y, 379
149
At least one author has proposed the United Nations Convention on the Law of the Sea (UNCLOS) as a
more impartial alternative to the WTO. See Lakshman Guruswamy, The Annihilation of the Sea Turtles: World
Trade Organization Intransigence and U.S. Equivocation, (2000) 30 Envtl. L. Rep.,10274 (“ In light of all the
shortcomings of GATT/WTO tribunals as a forum for trade and environment disputes, it is useful at this point to
emphasize the importance and viability of UNCLOS as another international forum for such cases.”)
they run contrary to the WTO‟s overriding policy to facilitate trade internationally. 150 He

contends that both the Panel‟s and Appellate Body‟s decision are consistent with the WTO‟s

unfortunate tendency to compromise environmental issues for the sake of increased trade

levels.151 According to him, unilateral environmental regulations may not be completely

consistent with the need for open, even-handed international trade. However, he also asserts that

the WTO Dispute Panel and Appellate Body have unconvincingly disparaged the text of GATT

Art. XX in order to maintain a strong, predetermined, and unnecessary position against unilateral

environmental trade measures.152

Summarizing the criticisms by the environmentalists, Marc Rietvelt stated that:

In concluding that Section 609 violated the conditions established by the chapeau, the

Appellate Body unduly privileged trade considerations, showed little understanding of

how customary international law or environmental policy works, and gave little hope that

the WTO will ever tolerate any real-world unilateral measures related to the protection

and conservation of the environment. In so doing, the decision in Shrimp-Turtle joins a

long line of disputes settled in the WTO (and under the predecessor GATT) in which the

trade organization has rejected Art. XX exceptions for national environmental measures

that may restrict trade.153

Generally, these critics wrap-up their concern on the Appellate Body‟s decision by posing certain

questions: Given the number of environmental concerns and the stringent requirements that must

be met to achieve WTO approval, will countries choose to incur the substantial costs required to

150
Bret Puls, The Murky Waters of International Environmental Jurisprudence: A Critique of Recent WTO
Holdings in the Shrimp- Turtle Controversy, 8 Minn. J. Global Trade, 343
151
Ibid.
152
Ibid.
153
Supra note 6, 498-499
implement a unilateral trade measure? Are the WTO requirements so cost-prohibitive that they

effectively foreclose any resort to environmental trade measures under Art. XX? The Shrimp-

Turtle Case indicates that the U.S is willing to incur such costs. But, do other countries have the

resources and the determination to do the same?154 Anticipating the difficulty in responding to

these questions, Neuling concludes that as a result of the Appellate Body‟s opinion, saving sea

turtles from destruction is now a more complicated undertaking for both the U.S and other

countries.155

3.2 The Trade Community’s Perspective

The International trade community also makes its criticism against the Shrimp-Turtle Case,

targeting the Appellate Body‟s backing of unilateralism. The international trade community

protests the Shrimp-Turtle holding on the ground that it gives the possibility for countries to

unilaterally impose extraterritorial trade restrictions based on individual, domestic agendas-

perhaps more importantly –without necessitating changes to the WTO rules.156

A representative critic in this regard, Alan Oxley, the former Australian Ambassador to the

GATT and Chairman of the GATT Contracting Parties, holds that:

This judgment of the Appellate Body follows the example set by the most activist of the

U.S. Supreme Court judges. It has interpreted WTO provisions to permit restrictions

which the membership of the WTO has previously indicated, overwhelmingly and

emphatically, they do not support ….There is now an urgent need to quarantine or, better,

154
Note, The WTO’s Shrimp-Turtle Decisions: The Extraterritorial Enforcement of U.S. Environmental
Policy via Unilateral Trade Embargoes (2001-2002) 8 Envtl. Law. 450
155
Supra note 39, 43
156
Alan Oxley, Implications of the Decisions in the WTO Shrimp Turtle Dispute (Feb.2002) Online: Int‟l
Trade Strategies LTD,< www.worldgrowth.org/pages/PDFs/shrimp-turtle.pdf.>, 3
 reverse, the opening for widespread imposition of trade restrictions on environmental

grounds which the Appellate Body has now legitimized.157

There are also other oppositions against the decision on what the trade community views as

dangerous precedents that the Appellate Body laid. Among these is the concern that Art. XX (g)

can have extraterritorial reach laying the precedent for the violation of state sovereignty .158

There is also the fear that trade restrictions can be imposed on a product if the way it is processed

has negative environmental consequences as determined by the importer, not by a neutral judicial

organ.159 Countries have different national environmental priorities and resources, as well as

different goals with regard to tapping the global trade system. What one country or society might

find objectionable as far as production process is concerned may not be perceived as such by

another. Accordingly, the critics argue, the U.S measure defeats the basis of all international

trade–the capacity of WTO members to exploit their comparative advantage.160

Some also express the fear that international declarations and conventions, regardless of whether

or not they have widespread support or adherence, may create legitimate grounds to trigger the

use of the exceptions under Art. XX.161 There are other critics arguing that non-trade elements of

the Preamble, e.g., “sustainable development,” now diminish the standing of the international

trade responsibilities of the WTO as its primary purpose.162 In its Preamble, the WTO purports to

have a commitment to “an open, non-discriminatory and equitable multilateral trading system on

157
Ibid.
158
Ibid.
159
Supra note 80, 40 See also Jerry Velasquez, Trade and Environment: Prospects for the Millennium
Round of Trade Talks, (2000-2003), Discussion Paper Series, 3 Online: Global Environment Information Centre,
<http://202.253.138.71/ENV/SIMPLE/publication1.cfm?type=1&ID=270>
160
Ibid
161
Ibid.
162
Ibid.4
the one hand,” and to the “protection of the environment, and promotion of sustainable

development on the other.”163 The critics go on arguing that yet, the Appellate Body never

whole-heartedly addresses or applies these dual principles whereas a non-trade organization

probably would have.164

3.3 The Developing Countries’ Perspective

Siding with the international trade community, but with a peculiar concern for their peculiar

realities, developing country members of the WTO also decry the so-called riddance of the

previous anti-environmentalist edifice by the Appellate Body. They fear that the decision

sanctions US unilateralism by permitting the grant of trade advantages conditional on the

adoption of US-style domestic policies in exporting developing countries.165 The critics on this

side argue that as is so often the case in such disputes, it is an industrialized country where

domestic pressure for international species conservation is perhaps greater, that is implementing

policies that affect developing countries, where the main concern is for development.166 This

raises the thorny issue of “eco-imperialism”. In this regard, the questions that arise are: Should

the U.S be allowed to impose its environmental standards on other countries? Don‟t such policies

put an unfair burden on developing countries? As indicated above, some people would argue

with the aim of the policy- to protect endangered sea turtles- but whether the US should be

allowed to make other countries accept its own shrimp fishing standards to achieve this is a moot

point.

163
Supra note 56, 739
164
Supra note 48
165
Supra note 111, 485
166
Ibid.
In this regard, the former Indian Minister for Environment, Kamal Nath, suggested that greater

trading opportunities will enable developing countries to invest more in environmental protection

and give them an opportunity to correct historical imbalances.167 He further maintains that till

then, there should be a moratorium on linking trade with environment.168 Professor Kelly also

argues that permitting individual nations to unilaterally regulate how goods are produced in other

countries as a condition of entry treads on the fundamental social policy decisions of other

societies.169 He argues that such “judicial activism” undermines the ability of developing

countries to participate in international policy formation because only the largest, most

developed nations possess the market power to impose their social policy on other nations.170

The approach by the Appellate Body in this regard enthused some of these critics to blame the

Appellate Body for illegitimate judicial activism under the influence by the rich northern

environmental NGOs. A fairly representative criticism in this regard is that of Jagdish Bhagwati,

a preeminent economist at Columbia University and a former adviser to the U.N. on

globalization who writes:

I have some sympathy for the view that the dispute settlement Panels and the Appellate

court must defer somewhat more to the political process instead of making law in

controversial matters. I have little doubt that the jurists were reflecting the political

pressures brought by the rich-country environmental NGOs and essentially made law that

affected the developing countries adversely, and in the process increasing the latter‟s

disquiet over the anti-developing-country turn they fear the WTO to be under pressure to

167
India for Delinking Trade from Ecology, Economic Times, November 24, 1994
168
Ibid.
169
J. Patrick Kelly, The Seduction of the Appellate Body: Shrimp/Turtle I and II and the Proper Role of
States in WTO Governance, (2005) 38 Cornell Int‟l L.J., 462
170
Ibid.
 take. Unless the WTO legal process understands that NGOs do not necessarily speak for

developing countries, contrary to their assertions, the WTO will stand in danger of

accentuating the problems of the North-South divide that are opening up so sharply after

Seattle.171

The “judicial activism” critique of the Appellate Body‟s Shrimp-Turtle ruling has another

dimension or alternative formulation. It has been argued that the law regarding “unilateral”

global environmental trade measures was a matter of controversy at the time of the Shrimp-

Turtle case, and that the Appellate Body over-reached in resolving a controversy that, given the

sensitivities involved,(including the delicate North-South issue) should properly have been

settled through negotiation, not litigation.172 This side of the argument asserts that now, the

Appellate Body was required to decide the appeal, and however the appeal was decided, it is

hard to imagine that the Appellate Body would not find itself on one side of the controversy or

the other, merely by virtue of having to make a legal ruling. The point is, according to these

critics, the Appellate Body was not institutionally situated such as to be neutral or completely

deferential to a political determination of the problem posed by the Shrimp-Turtle dispute.173 A

third version of the judicial activism critique on the Shrimp-Turtle Appellate Body ruling focuses

on the general notion that the Appellate Body somehow should have stepped aside, and allowed

the controversy to be resolved politically.174

This being the dominating position on the developing countries‟ side with regard to the Shrimp-

Turtle case, Southern environmentalists seem to be stranded between the two extremes. On the

171
Jagdish Bhagwati, After Seattle: Free Trade and the WTO, (2001) 77 International Affairs , 28
172
Supra note 1, 519
173
Ibid.
174
Ibid. 520
one hand, they are concerned that the sea turtle is indeed in danger of extinction and deep-sea

shrimp fishing without turtle-excluding devices does contribute seriously to their decimation.

They have appreciations to the environmental edifice that the Appellate Body laid because of

their concern for the protection of the Biodiversity that peculiarly characterizes their

environment.

On the other hand, they are bothered greatly by the US move to apply its domestic law to

activities that take place outside US jurisdiction. The US ban, to them, seeks to achieve a fine

objective with the wrong approach─ unilateralism.175 They argue that restrictions ought to be

applied not only to shrimps harvested in the wild but also to those that are produced in

environmentally damaging aquaculture farms.176 But they also argue that international

restrictions, bans, sanctions, etc. concerning the environment should be imposed according to

clear -cut rules of MEAs that are negotiated among countries and not through unilateral action by

a single, powerful nation. 177 They complain that the U.S, before imposing the ban had not raised

the issue in the CITES conferences, it had not signed the Convention on the Conservation of

Migratory Species or the United Nations Convention on the Law of the Sea or ratified the

Convention on Biological Diversity, all possible avenues for multilateral action on the protection

of endangered species.178

175
Walden Bello, The ‘Shrimp-Turtle Controversy’ and the Rise of Green Unilateralism,( 1997) 2 Online:
Focus on the Global South, < http://www.focusweb.org/trading-the-environment-4.html>
176
Ibid.
177
Shalmali Guttal, Trading the Environment, (2001), 2 , Online: Focus on the Global South, <
http://cice.kfem.or.kr/datafile/eng_pds/24_wto&environment.doc>
178
Stephen L. Kass &Jean M. Mc Carroll, Fidel, Saddam and the World Trade Organization, (1999)
4Linkages Journal , 13
Therefore, most Southern Environmentalists do not oppose the raising of environmental product

standards in the North. In fact, they support it. But in order to prevent this trend from turning into

a situation of de facto green protectionism that discriminates against developing country

producers, they underline the importance of positive measures, such as technology transfer aimed

at upgrading and rendering the production processes in the South more environmentally

friendly.179 This would include loosening patent and copyright rules so as to facilitate the

adoption, at low or reasonable prices, of Northern-owned eco-friendly technology-something

which Northern corporations maybe loathe to do.180 But support may not only be in the form of

the transfer packaged technology but also in that of financial assistance for indigenous research

and development activities in the South meant to come up with appropriate technology that meet

higher environmental standards.181

This position by environmentalists from the developing countries seems plausible for the

following reasons. First, in advocating a multilateral arrangement, it goes in line with the

approaches taken by the UN in dealing with environmental issues. The Rio declaration as well as

the various resolutions by the UNCTAD and UNEP sanction cooperation and joint action to

protect the environment.182 Second, the plea for technology transfer and technical assistance is

well supported by the “enabling clauses” of the GATT agreement, and hence, is consistent with

the WTO members‟ commitment.183 Creating a proper balance in integrating these requires

179
Supra note 169, 2
180
Ibid.
181
Ibid. 3
182
Rio Declaration on Environment and Development, Rio de Janeiro, June 1992, Principle 12, Online:
United Nations Environment Programme, <http://www.unep.org/Documents.multilingual/Default.
asp?Document ID=78&ArticleID=1163>
183
Part IV of the General Agreement on Tariffs and Trade (GATT 1947) stipulates Principles of
cooperation between the developing and developed country members and provides for the commitment by the
developed countries of extending various modes of preferential treatments to developing country members. The
further efforts of negotiations as well as a careful analysis of the rights and duties of WTO

members on the issue.

Those are the noteworthy analyses from the environmentalists and the international trade

community on the Shrimp-Turtle decision. As indicated above, all the commentators argue one

way or another, trying to accentuate on their respective positions. On the environmentalist‟s side,

this case presents a good case for consideration because it distills a lot of the environment issues

in a good way. However, they still have objections on what they think the WTO Dispute

settlement Body should consider in future similar cases. On the trade side, the inclusion of the

production method (how the Shrimp was caught) was interpreted as a good example of a

protectionist and unilateral scheme that obviously corrodes confidence between trading partners

involved in the issue. On the developing countries side too, the decision marks a de facto green

protectionism with tremendous negative consequences for their export-oriented development

strategies.

3.3 Important Issues of Particular Interest to the Trade and Environment Linkage in

the WTO

As indicated above, the wooly reasoning by the Appellate Body in the Shrimp-Turtle Case has

subjected the issue of trade measures in the WTO to groundswell of legal comments and

theoretical analyses. The Appellate Body decision has left a number of issues undecided and

nebulous, paving the way for further explanations and speculations on the fate of disputes in the

WTO arising from environmentally motivated trade measures. Therefore, future efforts are

General Agreement on Tariffs and Trade, 1947, Geneva, Online: The World Trade Organization, <
http://www.wto.org/english/docs_e/legal_e/06-gatt.doc>
necessary on a number of important issues that are crucially important to the relationship

between trade and the environment and the Appellate Body spawned in its decision in the

Shrimp-Turtle Case.

One of such issues is the finding that the term “exhaustible natural resources” in GATT Art. XX

“must be read by a treaty interpreter in the light of contemporary concerns of the community of

nations about the protection and conservation of the environment”. Accordingly, as opposed to

previous rulings, it found that the term includes non-living resources.184

Here, it is important to stipulate what the implication of adopting “evolutionary interpretation”

by the Appellate Body and accepting MEAs as a modality of action is in this regard. What is the

implication of the Appellate Body‟s reference to a number of MEAs in arriving at such finding?

Can we say that in this regard, all/at least some MEAS reflect the “common intention” of WTO

members and hence, have to be applied to all disputes involving WTO members? Does this

mean that the terms of reference to the Art. XX environmental exceptions of the GATT should

exist in the MEAs? As indicated above, the environmentalists welcome the decision by referring

to these issues as marking the strengthening of environmental position within the trade-

environment debate. However, failing explicit recognition of environmental policies and in light

of the intense debate on the mode of incorporation of environmental objectives in the WTO, the

answers to the questions seems to be somehow complicated.

The other important issue concerns environmentally motivated unilateral trade measures adopted

by the WTO members. The Appellate Body‟s decision has, in some cases, been interpreted to
184
Supra note 7, Para. 128-32
mean that unilateralism is acceptable to some degree. This is even though in the WTO, decision

by consensus is the over-riding theme and that no one country should solely dictate the rules. In

this regard, confusion still reigns as to whether sovereign states can or should be able to

unilaterally effectuate environmental goals through the channels of trade. Are unilateral trade

measures for environmental purposes permissible under the WTO? If permissible, what prior

actions with trading partners are necessary before such measures as the U.S measure in the

Shrimp-Turtle Case can be upheld? What is the implication, on the relationship between WTO

rules and MEAs, of the Appellate Body‟s requirement that multilateral negotiations should

precede unilateral measures?

As indicated above, the Appellate Body has scolded the U.S for failing to engage in “serious,

across-the-board” negotiations. This raises many practical questions: should the negotiations

necessarily result in an international agreement? Since Art. XX is intended to permit countries to

protect important non-trade interests and the word “party” in the Appellate Body‟s reasoning is

singular,185 the answer seems to be not. But, if the negotiations do not result in an actual

agreement, then how much of a diplomatic effort must the importing nation make? Could an

importing nation table a take-it-or-leave-it proposal and remain “serious”? Or must it enter in to

protected negotiations? If so, to what extent must it compromise its environmental objectives in

order to strike a deal? And if negotiations are unsuccessful, will Dispute Panels review the

negotiating record to determine whether the importing nation acted in good faith and showed

sufficient flexibility? Could an importing nation use a trade measure as a bargaining tactic to

force other countries to negotiate?

185
Supra note 105, 470
On the question of extrajurisdictionality discussed above, the Appellate Body seems to set an

implied rule that trade measures can be applied even if they purport to encourage other countries

to change their environmental policies. However, the Appellate Body‟s language on this issue is

carefully hedged. It stated “it is not necessary to assume that requiring from exporting countries

compliance with, or adoption of, certain policies… renders a measure a priori incapable of

justification…”186 Whether this will provide effective guidance to panels dealing with similar

circumstances is unclear, but this certainly leaves room for future litigation.187 The only thing

ruled out is an assumption that a measure designed with this intent is unjustified. Therefore, it is

not clear whether an environmental measure taken under the WTO can have an extra-territorial

reach. It is not also clear whether the natural resources, for the conservation of which the

measure is to be taken, should necessarily exist within the country‟s boundary, or a measure for

the conservation of any other natural resource in the globe can qualify.

There is also the fear that there could arise a series of “slippery slope” problems in placing limits

on the kind of unilateral measures that are permissible while creating a large loophole that will

be difficult and potentially expensive to police through adjudication.188 It becomes questionable

as to whether unilateral trade measure are also available for process regulations in other areas

such as labor policies under Art. XX (a) or health and safety policies under Art. XX (b).

Also, an important issue lies in the long-standing debate as to whether the WTO legal system is a

“self-contained regime” or part of the system of international law. Though the Appellate Body‟s

186
Ibid. Para 152-153
187
Supra note 68, 45
188
Supra note 167, 462
decision seems to tilt towards accepting the latter position as indicated above, much debate

reigns on the issue.

Due to the uncertain position of the WTO on these issues, the Shrimp-Turtle case remains a

battlefront for the unwon race between the international trade community and the

environmentalists. As indicated above, though many commentators construe it as favoring or

disfavoring their own stream, trade or environment, an objective assessment is needed to

articulate the exact precedent that the Appellate Body laid down. This will have much

significance in determining the place of environmental policies in the WTO.