Consumer preferences and the National Treatment Principle: emerging environmental regulations prompt a new look at an old problem

Should consumers’ preference for ‘green’ products help justify,from a WTO perspective, emerging regulations such as restrictions on trade in non-sustainable biofuels? Despite the role consumer preferences have played in WTO disputes, in association with the ‘ like ’ products concept, there has not been enough focused examination of their specific influence, particularly in disputes on ethical public policy issues, such as environmental or health regulations. To this end, this paper examines key GATT Article III disputes, pointing out that they included attempts both to measure, and also to interpret, consumer preferences. The latter approach becomes more tempting when consumer preferences are difficult to measure; import bans or restrictions associated with ethical public policy regulations can bring about such a situation. A hypothetical dispute about EC biofuels sustainability criteria demonstrates this problem. Options to make the concept of consumer preferences more coherent include limitations on how they can be invoked, and an increased commitment to capturing them through measurement

Trade, transboundary impacts and the implementation of SDG 12

The 2015 Sustainable Development Goals (SDGs) were developed to ‘transform our world.’ Yet critics argue that the concept of sustainable development serves to maintain an unsustainable status quo, or provide a positive gloss on a terminal conflict between its ‘pillars’: environmental protection, economic growth and social welfare. In this article, we examine this tension with respect to the implementation of SDG 12 in the European Union. SDG 12 calls for responsible consumption and production, which necessitates reconciling, or ‘decoupling’, economic growth and environmental degradation: the core of sustainable development. Initial examination reveals that the largest implementation gap is among high-consuming countries, including those of the EU, the focus of our article, who are failing to account for transboundary impacts of products consumed domestically. This shortcoming, facilitated by the flexibility of the SDG ‘global target, national action’ approach, undermines the achievement of other environmental SDGs relating to biodiversity and climate, among others. Yet, as compared to other EU approaches to addressing transboundary environmental harm from trade in existing Free Trade Agreements (FTAs) and Multilateral Environmental Agreements (MEAs), which we examine, the global focus and breadth of SDG 12 offers transformative potential. Ultimately, even if the three pillars of sustainable development are not ‘rebalanced’ toward environmental conservation, they can provide a construct for examining interactions and trade-offs between goals. Simply taking account of transboundary consumption, as SDG 12 indicators call for, would encourage more effective cooperation to help producing countries address environmental problems that result from production for export through impact assessment and enforcement

Is it rational and consistent? the WTO’s surprising role in shaping domestic public policy

What makes regulation rational? And why is rationality important to an international tribunal? In the World Trade Organization (WTO) context, these questions have had significant implications for the public policy of its Member countries. The WTO Appellate Body’s emerging emphasis on means–ends rationality testing is based on the questionable premise that consistent regulation is non-discriminatory. It has led regulators, such as the EU, to defend—and probably even construct—complex regulation in a way that emphasizes conformity to one overarching policy objective. More surprisingly, the Appellate Body has re-cast itself as public policy watchdog, pointing out when governments do not appear to be committed to their cause. In response, governments have strengthened disputed regulation, rather than making it less trade-restrictive. This retreat to rationality can be seen as a result of a difficult challenge facing the Appellate Body: how to review national regulation without passing judgment on it. More specifically, the rationality test pays the price of the Appellate Body’s retreat from proportionality

Deep and not comprehensive? What the WTO rules permit for a UK-EU FTA

WTO rules prohibit Free Trade Areas (FTAs) that provide tariff-free access or services liberalization in only one or a few sectors. In this sense, a narrow, sectoral approach to concluding an FTA between the EU and the UK would contravene WTO law. However, assuming the EU and the UK were able to agree a substantially broad tariff-free FTA, WTO rules would not prevent them from moving further to maintain the bulk of the benefits of the Customs Union and the Single Market in a few key sectors. They could establish customs union-like conditions by coordinating external tariffs in some sectors and agreeing on relaxed Rules of Origin (RoOs) administered lightly and Single Market-like access could be approximated through sectoral Mutual Recognition Agreements. Such an approach would enable continued deep integration, whose desirability has been signalled on both sides. It would fall short of current market access levels even in the selected sectors, and, in the case of tariff coordination, re-create some of the limits to an independent trade policy that Brexit aimed to remove. If the trade-off were deemed desirable, however, the approach could be reconciled with WTO rules including the ‘Most Favoured Nation’ requirement that equal treatment be awarded to all WTO Member States