Shrimp/Turtle WTO case DS 58

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Shrimp/Turtle WTO case DS 58

• United States Vs. India, Malaysia, Pakistan, and
  Thailand

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Background

• Not Your Typical Day At Sea
• Environmental effects
• Lingering Problem
• The Effects

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The issue

• US Conservation Policy
• Turtle Excluder Devices
• Section 609
• Sea turtles are a Shared global resource
• 6 0f 7 species are covered under CITES Convention
  as threatened or endangered

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US Shrimp Market

• Americans consume 900 million lbs of shrimp
  annually
• Shrimp is 1 fresh and frozen seafood in US
• The shrimp industry accounts for 10 bil in US
  consumer spending
• 2/3 of this industry derives from imported shrimp

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US shrimp embargo

• 1989 US starts negotiations with other countries
  to start sea turtle protection policies
• Non-certified countries imports of shrimp are
  banned
• 1996 US NGO Earth Island Institute files class
  action suit against DOS DOC for narrow
  interpretation
• US embargoed shrimp from trading partners to
  protect sea turtles
• Varying timetables for compliance with US
  regulations
• Previous WTO experience with production process
  (PPM) with Tuna/Dolphin case

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Shrimp Turtle WTO Case

• Complainants
• Malaysia
• India
• Pakistan
• Thailand
• GATT Article XI and GATT Article XX
• Section 609 of Endangered Species Act (ESA)

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CASE TIMELINE

• Oct 8th 1996 4 nations (India, Malaysia,
  Pakistan Thailand) jointly have consultations
  with the U.S.
• Nov 19th 1996 Consultations held without
  resolution
• Jan 9th Feb 25th 1997 India, Malaysia,
  Pakistan Thailand request DSB to establish a
  panel to look into the US embargo on importation
  of shrimp shrimp products.
• April 15th 1997 DSB establishes 3 member panel
• June 17th 19th 1997 Sept 15th 16th 1997
  Panel meets with parties concerned
• April 6th 1998 Panel issues final report
  ruling
• July 13rd 1998 US appeals against the panels
  ruling
• Oct 1998 Appellate Body gives its final report

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Arguments by Plaintiff nations

• Embargo of shrimp and shrimp products was against
  the MFN principle of Art 1.1 GATT
• Ban imposed by the US was inconsistent with Art
  XI of GATT (Art X1 limits the use of import
  prohibitions or restrictions)
• Ban imposed by the US was in contravention of Art
  XIII.I as the ban restricted importation of like
  products.

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Arguments by the US

• US measures complied with the relevant
  requirements of Article XX.
• Taken measures to protect sea turtles, an
  endangered natural resource
• Complainants didnt introduce effective
  shrimp/turtle policies
• US is in compliance with the WTO Agreement

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Panel Ruling April 6th 1998

• Ban Imposed by the US inconsistent with GATT
  Article XI
• (Art XI limits the use of import prohibitions or
  restrictions)
• US could not justify its measure under GATT Art
  XX
• (Art XX deals with general exceptions to the
  rules)
• The Panel reached the following Conclusions
• The import ban on shrimp and shrimp products as
  applied by the United States on the basis of
  Section 609 of Public Law 101-162 is not
  consistent with Article XI Section 1 of GATT
  1994, and cannot be justified under Article XX of
  GATT 1994.
• The Panel made this Recommendation
• United States bring this measure into conformity
  with its obligations under the WTO Agreement.
• July 28th 1998 US appeals against the panel
  ruling.

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DS 58 Panel Findings Regarding GATT Article XX

• The U.S. measure at issue constituted
  unjustifiable discrimination between countries
  where the same conditions prevail
• not within the scope of measures permitted under
  this Article.
• Widespread impact of the adoption of measures for
  conditional market access based on U.S.
  environmental conservation policy
• Other WTO Members likewise unilaterally adopting
  their own different conditional market access
  measures would undermine the multilateral trading
  system.

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Other Results of the DS 58 Panel

• Procedural Legal Interpretation of DSU Article
  13 Panel would not consider the information
  (amicus briefs) submitted by the NGOs
• The Panel did not request these submissions.
• Article 13 lays out that the initiative to seek
  and to select the source of information rests
  with the Panel.
• However, any party to the dispute (i.e., a Member
  of the WTO) is allowed to put forward the briefs,
  or any part thereof, as part of its own
  submissions.

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U.S. Appeal of DS 58

• Did Panel err in not considering information
  submitted by third party NGOs?
• Did Panel err in finding that the measure at
  issue constituted unjustifiable discrimination
  between countries where the same conditions
  prevail and thus is not within the scope of
  measures permitted under Article XX of the GATT
  1994?

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Summary of Actions of the DS 58 Appellate Body

• Reverses the Panel's finding that accepting
  non-requested information from non-governmental
  sources is incompatible with the provisions of
  the DSU.
• Reverses the Panel's finding that the United
  States measure at issue is not within the scope
  of measures permitted under the chapeau of
  Article XX of the GATT 1994.
• Concludes that the United States measure, while
  qualifying for provisional justification under
  Article XX(g), fails to meet the requirements of
  the chapeau of Article XX, and, therefore, is not
  justified under Article XX of GATT.

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Findings of the DS 58 Appellate Body Regarding
AMICUS BRIEFS

• Panel erred in its legal interpretation that
  accepting non-requested information from NGO
  sources is incompatible with the provisions of
  the DSU.
• The legal interpretation adopted by the Panel of
  the word "seek" in Article 13.1 of the DSU was
  too strictly technical.
• Instead, information could have been requested or
  not.
• However, whether the Panel requested/sought
  information or not, it still has the
  discretionary authority either to accept and
  consider or to reject information and advice
  submitted to it, in order to prevent a deluge of
  information.

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DS 58 Appellate Body Findings REGARDING SCOPE OF
ARTICLE XX

• Appraisal of Section 609 Under Article XX of the
  GATT 1994
• Panel erred in its legal interpretation that the
  U.S. measures fell outside of the scope of the
  Article.
• Rather, Paragraphs (a) to (j) of the Article
  comprise exceptional measures, whereby the
  domestic policies embodied in such measures have
  been recognized as important and legitimate in
  character.

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DS 58 Appellate Body Findings REGARDING ARTICLE
XX Contd

• Although qualifying for provisional justification
  under Article XX(g), the AB finds unjustifiable
  and arbitrary discrimination by the U.S.
• Measure fails to meet the requirements of the
  chapeau of Article XX, and therefore, is not
  justified under this.
• Throughout its application and certification
  processes under Section 609, the U.S. failed to
  meet certain minimum standards for transparency
  and procedural fairness in the administration of
  trade regulations as established under Article
  X3 of the GATT 1994.

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Implementation of Decision

• US and parties to the dispute reached agreement
  on a 13 month compliance period which ended in
  December 1999
• The US Department of State guidelines for
  implementing Section 609 was revised and issued
  after providing notice and an opportunity for
  public comment.
• US provided financial and technical assistance
  (training in the design, construction,
  installation and operation of TEDs to any
  government that requests it)

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Implications of the Case

• Opened NGO participation in WTO cases
• Production Process (PPM) for future cases
• Eco-imperialism by US?
• Enviro-trade related measures with no
  multilateral agreement (MEA)
• WTO treatment as trade issue but did not address
  environmental concerns

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WTO JURISPRUDENCE

• Development of WTO laws
• Must recognize the participation of global
  actors, including NGOs
• Unilateralism and Sovereignty
• Execution of trade-related environmental
  regulations across international boundaries
• Narrow legal interpretation versus the spirit of
  chapeau

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Updates

• Shift to aquaculture as wild shrimp resources are
  depleted
• Aquaculture criticized as polluting
• Inter American Convention for Protection and
  Conservation of Sea Turtles