RESTRICTED
WORLD TRADE WT/CTE/M/5
30November 1995
ORGANIZATION(95-3865)
Committee onTrade andEnvironment
REPORT OFTHE MEETING HELD ON26-27 OCTOBER 1995
Note bytheSecretariat
1. TheCommittee onTrade andEnvironment meton26-27 October 1995 under the
chairmanship ofAmbassador JuanCarlos Sánchez Arnau ofArgentina. Theagenda forthe
meeting contained inWT/AIR/174 wasadopted.
2. Itwasagreed thattheSecretariat would circulate draftRules ofProcedure forthe
Committee, based onthose oftheGeneral Council, fordelegations 'comments andthat,if
necessary, theChairman would holdinformal consultations inorder thattheRules could be
considered attheCommittee 'sDecember meeting.
Stocktaking andplanning ofwork
3. TheChairman reported onhisinformal consultations andpresented hisproposal forthe
Committee 'swork programme asitapproached theSingapore Ministerial Conference (Annex 1).
Hesaidthatseveral points hademerged from hisconsultations. TheCommittee hadacomplex
andcomprehensive agenda andthere were highexpectations about theoutcome ofitswork.
There wasalsoanawareness thattheCommittee laboured under anumber ofconstraints. Two
perspectives ontheCommittee 'sfuture work programme hademerged: one,thatefforts should
focus onalimited number ifissues; theother, thatwork should advance onallfronts atthesame
rateinorder topresent abalanced outcome toMinisters inSingapore. TheChairman was
proposing, therefore, tokeepallagenda Items under discussion buttomove, whenever possible,
totheanalysis ofthose issues identified during thedebate asthecoreofeachItem. InMay1996
afurther review ofthework programme would takeplace. Hesaidthathisproposal represented
adelicate balance. Itwasnowincumbent ondelegations toputforward specific proposals sothat
areas ofinterest tothem could beaddressed andprogress made.
4. With respect totheChairman 'sproposal ontheschedule ofmeetings through toMay
1996, some delegations suggested combining theMarch andApril meetings. TheChairman said
meeting dates would beconfirmed atthe14-15 December meeting.
5. Therepresentative ofEgypt saidthatunder Item1oftheCommittee 'sagenda, before
addressing thecompatibility oftrade measures inMEAs withtheWTO itwasimportant tohavea
precise definition ofwhatconstituted anMEA, toexamine thenecessity andeffectiveness ofusing
trade measures inMEAs, andtoexamine howfuture amendments toMEAs would betreated.
Theobligations ofMEAs were notstatic: more stringent measures could betaken ifnew
scientific evidence revealed suchaneed, andlessstringent ordifferent measures could be
advocated ifthose currently inuseproved ineffective. Therepresentative ofMorocco shared this
view.WT/CTE/M/5
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6. Under Item3(b), Egypt saiditwasimportant todiscuss howtostrengthen international
cooperation ontechnical standards. OnItem6,riskassessment, aweighing oftheeconomic costs
against theenvironmental benefits, andthenotion ofproportionality should beaddressed since
some environmental benefits might notbesohighastowarrant trade losses, especially for
developing countries.
7. Therepresentative oftheEuropean Communities saidthatinorder toreach operational
conclusions bySingapore itwould benecessary tomaintain aclear objective intheform ofa
sufficiently elaborate report toMinisters, tomove from agenda Items tospecific issues, andto
haveinformal meetings.
8. Therepresentative ofSwitzerland saidthatwork should progress onallItems, butsome
were riper thanothers andthese should beemphasized.
9. Therepresentative ofIndia saidhisdelegation wasprepared tomove forward onseveral
items, suchasDPGs, TRIPS andmarket access, inorder toarrive atabalanced outcome by
Singapore, andalong withtherepresentatives ofBolivia, Colombia, Hungary, India, Korea,
Morocco, Peru, Uruguay, andVenezuela saidthatthework programme should bebalanced and
openandwelcomed thefactthatdelegations would beabletointroduce newissues under each
Item. Therepresentatives ofKorea andMalaysia, onbehalf ofASEAN saidthatanypapers on
specific issues should becirculated wellinadvance ofmeetings.
10. Therepresentative ofNorway saiditwould bedifficult toachieve concrete results by
Singapore iftoomany issues were discussed. After fouryears, itshould bepossible toformulate
substantive conclusions andpossible recommendations oncertain issues. Theonlywaytoset
about thiswould betointensify informal consultations among delegations andforformal meetings
tobeaccompanied byinformal, open-ended meetings. Without suggesting thatanyItems should
beomitted, some issues hadbeendiscussed atlength andifwork were intensified onthese,
notably MEAs, TRIPS, market access, andDPGs, results could emerge bySingapore. Oneissue
which wasripewasItem1.Itwasclear thatsome parts ofthemultilateral trading system would
havetobemodified toaccommodate trade measures inMEAs. Work onthisItemshould nowbe
oriented towards results, anditshould befeasible toenvisage adraftunderstanding bySingapore
which could operate onaninterim basis untilthere wasamore comprehensive package ontrade
andenvironment.
11. Therepresentative ofBrazil saidthattheSingapore meeting should notcreate expectations
about prescribing changes inWTO rules. Hisunderstanding wasthatMinisters would review the
work andterms ofreference oftheCommittee; itwasnotclear there would beanyresult on
amending WTO provisions. Oneimportant result could betheinstitutionalization ofthe
Committee, which hadproven tobeauseful forum foranalysis. Given thelengthy process of
negotiation inorder toarrive atabalanced work programme, itwould beunrealistic toexpect
concrete results intheform ofproposals foraction which would privilege certain issues deemed as
riper forresults. Theidentification ofcertain issues under eachItemshould nothidetheneedto
reach conclusions ontheoverall work programme. Ananalysis ofalltheissues should be
undertaken byintensifying informal consultations, preferably coupled withthePlenary meetings,
andbyseeking collaborative arrangements withtheTBTCommittee andtheTRIPs Council, as
wellastheUNCTAD, UNEP andMEAs Secretariats.
12. Therepresentative oftheUnited States saidtheChairman 'swork programme and
informal, open-ended meetings would puttheCommittee ontherighttrack forproducing areport
forMinisters which included substantive results. Concerning thelasttwoissues described underWT/CTE/M/5
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Item3(b)oftheChairman 'sproposal andasimilar phrase inparagraph 2(d)1, shesaidthe
wording could givetheimpression thatalltheCommittee wasexamining wasdeveloping more
rules onenvironmental measures. Shedidnotconsider itshould havepreconceived notions about
thenature ofitsresults. Given theCommittee 'sterms ofreference, thepoint ofdeparture could
notbetheneedforfurther disciplines. Forexample, itmight bedetermined that,inorder to
promote mutually supportive policies itwasappropriate torecommend additional flexibility for
environmental measures. Inorder tomaintain abalanced approach, theunderstanding hadtobe
thatwording suchasthiswasonlyillustrative andcould alsobereadtoallow forthepossibility
ofmore flexibility intherules rather thanfurther disciplines. Shereferred totheGeneral
Council 'sefforts inthecontext ofItem10andsaidherdelegation would wishtoreturn toitinthe
nearfuture.
13. TheCommittee adopted theChairman 'sproposal fortheCommittee 'swork programme
through toMay1996 which isattached asAnnex 1and,following thedecision taken attheTBT
Committee 'smeeting of20October, agreed toconvene jointinformal meetings withtheTBT
Committee oneco-labelling.
Item1
Therelationship between theprovisions ofthemultilateral trading system and
trade measures forenvironmental purposes, including those pursuant to
multilateral environmental agreements
14. Therepresentative oftheEuropean Communities saidthiswasacore-issue onthe
international agenda. Itwasgenerally recognized thatthemultilateral trading system should
favourably consider trade restrictive measures taken pursuant toMEAs. Asstated inPrinciples 7
and12oftheRioDeclaration, international co-operation wasthemost environmentally effective
manner through which totackle transboundary andglobal environmental problems anditwas
likely toprevent theuseofunilateral trade restrictions. Themultilateral trading system should
accommodate theuseoftrade measures inMEAs, although theircompatibility withWTO rules
might bequestionable because thefactthatsuchmeasures hadbeennegotiated andagreed
multilaterally wasthebestguarantee against theriskofprotectionism. Atthesame time, itwas
widely agreed thatunilateral trade action todealwithenvironmental challenges outside an
importing country 'sjurisdiction should beavoided: itmight leadtoprotectionist abuse andhave
theeffect ofinterfering withcountries 'ability toexercise theirrighttodetermine their
environmental policies. International environmental cooperation hadresulted in180agreements
fortheprotection oftheglobal environment andconservation ofnatural resources, ofwhich only
18contained trade provisions; these allowed forthepossibility ofrestricting trade toachieve the
environmental goaleffectively.
15. Thetwomain WTO legalissues concerned thetreatment ofMEA non-parties andthe
impact ofthetrade measure taken under MEAs onthirdcountries. Heenquired astowhatwould
happen, forinstance, ifexports ofnon-ecological goods were banned from anon-party tocontrol
itsproduction andconsumption ofgoods covered bytheMEA andprevent theundermining ofthe
MEA'senvironmental objectives. Thecountry affected bytheimport bancould argue that
quantitative restrictions were WTO-illegal andcould askfordispute settlement. Here, he
considered thattheWTO should, inaccordance withtheUNCED principles, support the
achievement ofoverwhelming environmental objectives while preserving theopen, equitable and
non-discriminatory character ofthemultilateral trading system. Thechallenge wastodesign a
system which wasgeared toaccommodating trade measures inMEAs while establishing
safeguards against theapplication ofunnecessary restrictions onWTO Members, especially MEAWT/CTE/M/5
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non-parties, andpreserving theirrighttodemand thattheDispute Settlement Mechanism beused
toprevent protectionist abuse.
16. Inconsidering theoptions which hadbeenproposed toclarify therelationship between
WTO rules andmeasures taken pursuant toMEAs, abalance should bestruck between the
following principles: flexibility/freedom :flexibility forMEA negotiators toinclude trade
measures inbothpresent andfuture environmental agreements asnecessary toachieve
environmental goals; freedom forWTO Members tochallenge atrade measure which theyfelt
contravened WTO rules; security/certainty :security thattrade measures inMEAs could be
legitimate under theWTO andprotected from undue challenge; assurance thatsuchtrade
measures were implemented inrespect oftheprinciples oftheheadnote toGATT Article XX,
which existed toguard against theuseoftrade measures forprotectionist reasons ortheirarbitrary
ordiscriminatory application. Todate, noGATT/WTO challenge hadbeenmade against trade
measures taken pursuant toanMEA. Thishasledtotalkoftheirdefacto WTO compatibility. A
challenge tothose measures would verylikely facepublic hostility, particularly when thecountry
challenging themeasure wasaParty totherelevant MEA, asthechallenge could beseenasa
direct assault onanenvironmental instrument enjoying international support. Arguably, defacto
compatibility wasnotsufficient because itdidnotprovide MEA negotiators withthelegal
certainty thatthetrade instruments theydeemed necessary tomake theMEA effective would not
bechallenged inthefuture. Toestablish dejurecompatibility, twoapproaches hadbeen
developed: theso-called expostandexanteapproaches.
17. Theexpostapproach envisaged granting awaiver under GATT Article XXV:5 forMEAs
onacase-by-case basis. Theadvantage ofthisapproach would bethatinnocasewould a
measure which wasnotbased onbroad international consensus escape WTO scrutiny, which
provided adefence against protectionist abuse. However, apart from arelevant number oflegal
andprocedural obstacles, which hisdelegation hadnoted inOctober 1994, anyexpostapproach
suchasanArticle XXV:5 waiver seemed unsuitable asitwould imply thatenvironmental
protection remained exogenous totheWTO andwould place theWTO inaposition of
"judgement" onmatters ofenvironmental competence. Thiswould benegatively perceived bythe
environmental community. Thus, itcould beargued thatalthough asituation ofdefacto
compatibility wasnotsufficient, itwasbetter thanpossible WTO scrutiny ofthelegitimacy of
environmental objectives orofthenecessity ofmeasures taken toachieve those objectives.
18. Theexanteapproach, which hisdelegation hadproposed intheEMIT Group andinthe
Sub-Committee, wasbased onacollective interpretation ofGATT Article XXwhich would imply
thattrade measures taken pursuant toMEAs which represented agenuine international consensus
andcomplied withspecific criteria interms ofnecessity andleast-trade-restrictiveness could
derogate from WTO obligations. Theadvantage ofdeveloping criteria fortrade measures in
MEAs andforMEAs themselves would begreater certainty forthose countries wishing infuture
toprovide fortrade measures inMEAs. AslongastheMEA metcriteria forbeing recognized as
enshrining genuine international consensus andthemeasure metthecriteria mentioned above,
countries could beconfident thattheywould notbechallenged intheWTO. Themain
disadvantage oftheexanteapproach wasthatitwould bedifficult todefine criteria thatwere not
solaxastoengender thefearofhanding outa"blank cheque" toMEA negotiators interms ofthe
possibility ofcontravening WTO rules, butwere notsoinflexible thatpossible future trade
measures taken foralegitimate environmental objective would notbeunduly restricted.
19. Toreconcile theneedtoaccommodate thelegitimate goalofenvironmental protection in
theWTO when itwastheexpression ofinternational cooperation withtheneedtopreserve the
open, equitable andnon-discriminatory character oftheWTO, hisdelegation haddevised aWT/CTE/M/5
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possible solution toembody theadvantages ofthetwoapproaches interms ofthetwosetsof
principles, flexibility/freedom andsecurity/certainty. There might beanumber ofpossible
solutions thatwould beworth exploring. Without intending tobeexhaustive ortolimitthescope
offuture work, heoutlined three possible forms ofexanteandexpostapproaches: (i)an
amendment toGATT Article XXentailing anadditional paragraph (k),providing an
Understanding setting outtheprovisions forpreferential treatment oftrade measures taken
pursuant tocertain MEAs; (ii)noamendment toArticle XXbutthesame Understanding (slightly
adjusted); and(iii)anamendment toArticle XX(b), withaninterpretative notetointroduce a
reference tomeasures necessary toprotect theenvironment andtomeasures taken pursuant to
MEAs tosolve global ortransboundary environmental problems.
20. Thefirstapproach consisted ofanadditional paragraph (k)inArticle XX,mentioning
explicitly MEAs andreferring toanUnderstanding ontherelationship between MEA-based
measures andWTO rules. Theproposal would takeintoaccount theneeds andfears of
environmentalists andthetrade community. Itwould provide alegalandprocedural framework
fordejurecompatibility ofMEA-based trade measures. Recognizing thatMEA-based trade
measures should beaccorded preferential treatment, itdidnotexempt suchmeasures from the
possibility ofachallenge. WTO Members which were non-parties totheMEA inquestion would
seeinnowaytheirrighttoresort toWTO dispute settlement restrained. Intheevent thatan
MEA-based trade measure were challenged byanon-party, apanel would apply athree step-
approach, thesame asintheTuna-Dolphin panel: (i)thepanel would review whether the
measure hadbeentaken under anMEA which wastheexpression ofgenuine international
consensus andtaken fortheachievement ofalegitimate environmental objective; (ii)ifso,the
panel would deem themeasure tobenecessary fortheachievement oftheenvironmental objective
oftheMEA; (iii)thepanel would retain fullcompetence todetermine whether themeasure had
beenapplied inconformity withtherequirements oftheheadnote toArticle XX. Insum, apanel
would examine whether aMEA metthecriteria setoutintheUnderstanding. Ifitfound thatthe
criteria hadbeenmet,thenitwould notexamine aparticular MEA-based trade measure to
determine either thelegitimacy oftheenvironmental objective orthenecessity ofthemeasures
taken toachieve thatobjective, butitcould examine theapplication ofthemeasures according to
theprovisions oftheArticle XXheadnote. Where anMEA wasfound nottomeetthecriteria of
theUnderstanding, thenapanel would examine boththe"necessity" ofthemeasures andthe
application ofthose measures inthelightoftheheadnote toArticle XX. TheMEA-based trade
measure would notbenefit from thepreferential treatment forwhich provision hadbeenmade in
theUnderstanding, anditwould besubject tothepanel'susual fullscrutiny procedures.
21. Interms oftheneedforpredictability/security andflexibility, suchaproposal provided
some security toMEA Parties thatwhere anMEA metthecriteria setoutintheUnderstanding, a
panel would notexamine either thelegitimacy oftheenvironmental objective orthenecessity of
themeasures taken toachieve thatobjective. Itwasimportant tounderline thatMEA-based trade
measures were nevertheless governed bytheArticle XXheadnote. Thiswould beaguarantee
against protectionist ordiscriminatory abuse ofthose trade measures provided forinMEAs. The
proposal would provide flexibility forenvironmental policymakers interms ofjudgement onthe
legitimacy ofenvironmental objectives andtypes oftrade measures. Byavoiding specifying those
trade measures which might ormight notbetaken, theproposal would alsomaintain forthe
trading system theflexibility todevelop more sophisticated orlessdistortive instruments bywhich
toachieve environmental objectives. Atthesame time, there would besecurity forthe
multilateral trade system since theriskofprotectionist abuse intheimplementation ofthetrade
measures would bedispelled bythepreservation oftherights ofMembers toqualified WTO
scrutiny. MEAs would retain fullcompetence tojudge thelegitimacy ofanenvironmental
objective andtoselect theappropriate means foritsachievement. TheWTO would retain itsfullWT/CTE/M/5
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potential tocounter protectionist abuse oftrade measures through thedispute settlement
mechanism. With thegoalofcooperation between thetrade andenvironment communities, and
withaviewtotheavoidance oftheneedfordispute settlement, theproposal could encourage
consultation between theWTO Secretariat andtheMEA Secretariat bothduring initial negotiations
ofanMEA andduring anysubsequent amendment.
22. Asecond approach would betodevelop anUnderstanding thatmeasures forwhich
provision wasmade inArticle XXmight alsoinclude those taken pursuant toMEAs according to
certain criteria. Thisapproach would differ informat from thefirstbutthepreferential track
would remain unchanged. Theadvantage ofthisoption wasthatitwould notrequire an
amendment toaGATT Article andratification byMembers. Thedisadvantage wasthatthe
environmental window oftheWTO would belessvisible totheoutside world, although in
substance itwould havethesame impact astheprevious approach.
23. Athirdapproach would betoamend Article XX(b)soastocover measures necessary to
protect theenvironment andmeasures taken pursuant toMEAs. Thiswould bewellreceived by
environmentalists. Thepossible coverage under thisexception ofextraterritorial trade measures to
influence other countries 'environmental policies raised concerns, andinorder toaddress them it
might beappropriate toinclude aninterpretative notereaffirming some ofthekeynotions included
inPrinciple 12oftheRioDeclaration. Aninterpretative notecould alsoinclude provisions to
clarify thenotion ofanMEA andhowtheexpostscrutiny ofMEA-based trade measures would
bearticulated through theWTO dispute settlement mechanism.
24. Therepresentative ofHong Kong saidtheissues raised under thisItemwere directly
relevant tothefirsttwoobjectives oftheCommittee 'smandate forSingapore. Thefirsttaskwas
toensure thattrade measures taken under MEAs were WTO-compatible. Itwasincorrect to
interpret theCommittee 'stasktheother wayround, i.e.toensure thatWTO provisions were
compatible withtrade measures inMEAs, asWTO provisions tookprecedence overMEAs forthe
timebeing. Attheoutset ofwhatmight beamore pragmatic series ofdeliberations, the
discussions should notdriftinthewrong direction. Inthisrespect, theCommittee needed tohave
anadequate knowledge ofthetrade measures inquestion, thetypes andnature oftrade measures
inMEAs, themanner inwhich theywere taken, andtheirtrade andenvironmental effects ona
case-by-case basis. Thebasis onwhich these measures were taken, namely therelevant MEA
provisions, must alsobestudied andcompared withWTO provisions asappropriate. An
examination ofWTO-compatibility must consider theopenness, equity, andnon-discriminatory
nature ofthemultilateral trading system, which wasacomplex task.
25. Therepresentative ofIndia appreciated document WT/CTE/W/12 which outlined the
requests made bytheOzone Secretariat toCommittee Members sothatadialogue could takeplace
onanydecision onthedumping ofproducts containing ozone depleting substances andof
equipment manufacturing suchproducts inArticle 5countries. Hisdelegation hadspoken inother
foraofthebasic domestic needs ofdeveloping countries, andwould continue consultations with
other interested Members onthissubject asitwasconcerned about thecircumstances inwhich
trade measures were being proposed, aswellasthechoice ofsuchmeasures andmodalities for
theirapplication. Inhisdelegation 'sview, trade measures were notthebestwaytodealwith
environmental concerns anditwasagainst theadoption ofanyunilateral trade measure ortrade
sanction, evenifintroduced withtheobjective ofsafeguarding theenvironment. Itwasimportant
fortheCommittee toconsider theissues involved. Inconsidering thedefinition ofanMEA,
several factors must betaken intoaccount: (i)theMEA must haveawidegeographical scope;
(ii)itmust include countries indifferent stages ofdevelopment soastobalance thedemands and
aspirations ofdeveloping countries; (iii)theMEA must beopentoallcountries tojoinandonnoWT/CTE/M/5
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account should itcondone thecreation ofanexclusive club, asanydecision which wastaken on
thissensitive issue would affect allmembers oftheinternational community; and(iv)theMEA
should beunder international auspices, asonlythenwould itbecredible anditsimplementing
organs safeguarded.
26. Heenquired about thecharacteristics ofthetrade measures which could beusedtoachieve
MEAs 'objectives. Issues ofalocalenvironmental nature must beaddressed bythecountry
concerned, respecting itsnational sovereign economic space, anditwould notbedesirable for
individual countries tobepressured byexternal sources toredress localenvironmental problems.
Ontheother hand, issues ofaglobal environmental nature should betackled onaninstitutional
basis bytheinternational community. Such issues would bydefinition require thecooperation of
several countries andwould belinked totheproblems associated withphysical transborder
spillover. Ofcourse, trade measures contemplated under anMEA totackle suchproblems must
beWTO-consistent. Inthisregard, hesupported thesuggestion bythedelegation ofEgypt fora
necessity andeffectiveness test.
27. Therepresentative ofKorea joined India inexpressing concern about developments inthe
Montreal Protocol relating tomeeting basic domestic needs forozone depleting substances in
developing countries andsaidhewasinterested indiscussing thismatter withother Members.
Unilateral measures taken outside thejurisdiction oftheimporting country posed fundamental
challenges tothemultilateral trading system. TheWTO wastheappropriate andauthoritative
forum foraddressing trade measures forenvironmental purposes. There wasnoreason tomodify
itsprovisions. Allpossible efforts should bemade toaccommodate trade measures within its
framework. Bearing thisinmind, hisdelegation didnotsupport theexanteapproach which
would leadtoabroader interpretation ofWTO exception clauses. Although efforts toclarify
GATT Article XXwere desirable, theyshould bedistinguished from attempts tobroaden its
scope. Hisdelegation wasinfavour ofacase-by-case expostapproach based onArticle XXV as
onlyafewMEAs contained trade measures andmost ofthese were notWTO-inconsistent. There
wasaneedfortheWTO togiveguidance toMEAs which contained orwould contain trade
measures toenhance thepredictability andcompatibility oftrade measures inMEAs; thecriteria
forsuchguiding principles would needtobeelaborated. Therecent decision toamend theBasel
Convention showed theneedfortheWTO todevelop guidelines, since heconsidered the
amendment tobeWTO-inconsistent. Assuch, acombined approach based onexpostprocedures
withconcrete guidelines deserved consideration.
28. Therepresentative ofEgypt saidthatalthough noagreed synthesis hadbeenreached, a
number ofvalid theses andanti-theses hadbeenelaborated andwould needtobestudied. First,
outof180international environmental treaties andagreements, lessthan20included trade
provisions which restricted trade forenvironmental purposes, andtheirlegality hadnever been
challenged under GATT/WTO. Astrade measures hadbeenusedinMEAs toaddress different
problems, itwasdifficult toformulate general conclusions: therelationship between thetrade
provisions inMEAs andWTO rights andobligations necessitated anexamination ofeachMEA
separately. Second, theex-ante andex-post approaches hadbeendiscussed atlength butno
solution wasinsight. Third, theruleofonetreaty taking precedence overanother under thelex
posteriori andlexspecialis principles wasofnoavail. Herdelegation considered thatArticle XX
asinterpreted todatewassufficient tocover trade provisions inMEAs, andthatitcould be
coupled withanex-post waiver approach.
29. Inthatregard, shesupported thesuggestions ofIndia fordefining specific criteria, and
added thefollowing: (i)theuniversal scope ofMEAs. There should beaclear distinction
between MEAs negotiated under theaegis oftheUNandregional orplurilateral agreements;WT/CTE/M/5
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(ii)amendments toMEAs should beaddressed separately, interms oftheirscope, application,
levelofsignatories, andtrade provisions; (iii)thedomestic versus international impact oftrade
provisions inMEAs. Itwasimportant alsotoapply anecessity andeffectiveness testandto
assess theimpact ofthetrade provisions. Before initiating anynegotiation onreinterpreting
Article XX,there would needtobeareview ofwhich Articles inWTO Agreements might need
reinterpreting toexplicitly adapt them forenvironmental protection. Coordination oftrade and
environment onahorizontal basis inWTO Agreements wasofvitalimportance andshould be
studied indepth before addressing Article XXonitsown.
30. Therepresentative ofMexico noted thatseveral delegations hadoutlined approaches which
involved tosome extent derogation from WTO rules fortrade measures inMEAs, butsaiditwas
premature tocomment onthem astheCommittee hadnotyetanalyzed anumber ofelements
which were essential inassessing theirsuitability. Some delegations placed emphasis onconcepts
suchasnecessity, effectiveness, leasttrade-restrictiveness, andproportionality, andsheagreed on
theimportance ofconsidering these before reaching anyconclusions ontheWTO-compatibility of
trade measures contained inMEAs. Anassessment oftheneedforpossible changes toWTO
provisions would havetobebased onanevaluation oftheneedforusing different trade measures
forenvironmental purposes, including theneedtoinclude trade measures inMEAs. One
approach proposed under thisagenda Iteminvolved renouncing theWTO principle ofnon-
discrimination andshequestioned whether thatwould bejustified inthecaseofameasure which
could notbeconsidered necessary, effective orproportional andhowthiscould bereconciled with
theCommittee 'smandate thatanyrecommendation forchanges totheWTO must becompatible
withthenon-discriminatory nature oftheWTO.
31. Document WT/CTE/W/12 illustrated howtheanalysis could beadvanced onthebasis of
case-by-case studies. Herdelegation wasinterested inexamining inthecontext oftheBasel
Convention thenecessity forincluding theprohibition oftransborder movement ofhazardous
wastes forrecycling purposes, bearing inmind thatrecycling capacity existed incountries which
would notbeabletoimport rawmaterials asaresult. Shequestioned theeffectiveness ofthe
measure, astheprohibition applied onlytotrade from onegroup ofcountries toanother, andthe
logic oftheproportionality ofthemeasure from theperspective ofeffectiveness andtrade impact
andwhether itcontributed tosustainable development. Consideration alsoneeded tobegiven to
thequestion ofdiscrimination between MEA Parties. Document WT/CTE/W/12 raised questions
which would havetobeaddressed, among them thedefinition ofaconsensus-based measure.
Principle 12oftheRioDeclaration stated thatglobal andtransborder environmental problems
should beaddressed through international cooperation andMEAs. Assuch, thediscussion centred
onspecific trade measures contained inMEAs andnottheMEAs perse.However, defining what
constituted anMEA wasimportant. Shesaidthatherquestions andcomments were notintended
toprejudge thevalidity ofanyspecific MEA oritspurposes butwere intended toencourage the
analysis ofissues before anyapproach wasdiscussed.
32. Therepresentative ofChile saidthatthediscussions todateonItem1indicated thatthere
wasnofundamental incompatibility between trade measures inMEAs andtheWTO andthatthere
were onlyalimited number ofMEAs which required trade-related measures toaccomplish their
objectives. When these measures hadbeenincluded, efforts hadbeenmade tobring them into
linewithWTO disciplines. Anequilibrium needed tobefound. Trade measures should onlybe
included inMEAs exceptionally when nosuitable environmental measure existed toachieve the
objectives. Parties using trade measures inMEAs should ensure thattheywere notdiscriminatory
andwere theleasttrade restrictive. There wasaneedtohaveadegree ofproportionality between
trade measures andtheenvironmental objective. Forexample itwould notbeacceptable toapply
measures which caused significant trade distortion toachieve limited environmental objectives.WT/CTE/M/5
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33. Therepresentative ofNorway saidthisItemwasatthecoreofthetrade andenvironment
interface asitraised thequestion ofhowtoensure thecompatibility oftrade measures taken
pursuant toMEAs withWTO provisions while avoiding protectionist abuse. Ofthetwomain
options which hademerged intheCommittee 'sdiscussions, hisdelegation favoured anexante
approach based onacollective interpretation oramodification ofArticle XX. Anexpost
approach would notprovide policymakers withtheflexibility tonegotiate anMEA norsecurity in
relation tothetrade rules. Under theexanteapproach, parameters could besetfortheuseof
trade measures inanMEA topromote sustainable development andavoid disguised protectionism.
TheGATT hadatradition ofnotinterfering inother fora'swork; forexample, commodity
agreements were exempted from GATT/WTO disciplines through Article XX. Also, no
GATT/WTO dispute stemming from measures taken pursuant toMEAs hadarisen. Thus, trade
measures forenvironmental purposes should notbesubject toandisproportionate number of
criteria inrelation toother issues covered byArticle XX. Hisdelegation considered thefollowing
criteria tobeessential toensure thattrade measures taken pursuant toMEAs didnotaccommodate
protectionism butserved thegenuine purpose ofenvironmental protection: (i)theMEA should
satisfy formal criteria concerning openness; (ii)theMEA should bespecific withregard tothe
useoftrade measures; (iii)trade measures inMEAs should benecessary toachieve the
environmental goal; and(iv)theleasttrade restrictive trade measures thatallowed for
achievement oftheenvironmental goalshould bechosen. Ifadispute were referred toWTO
dispute settlement, expertise ontheMEA should beincluded.
34. Therepresentative ofSwitzerland attached importance toprogress onItem1asitwould
haveimplications fordiscussions onother items. OftheMEAs inplace, onlyafewcontained
trade measures andonlyafewofthose measures could beconsidered contrary toWTO principles.
There hadbeennoWTO challenge toanyMEA which contained trade measures, which might
suggest itwasnoturgent toachieve apragmatic solution. However, international environmental
lawhadevolved rapidly inthepastfewyears andrecent developments intheMontreal Protocol
andtheBasel Convention hadrevealed atrend tostrengthen existing andinclude newtrade
measures inMEAs, sothatitwasnecessary toadopt apreventive attitude anddevelop rules
before adispute occurred. After having reviewed document WT/CTE/W/4, hisdelegation
supported anexanteapproach toreconcile trade measures inMEAs withtheWTO. Anexpost
approach hadimportant drawbacks inthatitwould examine WTO-compatibility oftrade measures
inexisting MEAs andnotensure thatfuture trade measures inMEAs would beWTO-consistent.
Inthisrespect, WTO procedures forgranting waivers were notadapted toenvironmental problems
andshould bechanged totakethem intoaccount. Apermanent waiver, which would permit trade
measures tobetaken toachieve MEA objectives, would notbereconcilable withWTO Article IX.
Also, anexpostapproach would entail establishing ahierarchy between MEAs andtheWTO,
which hisdelegation considered undesirable andwhich international lawhadattempted toavoid.
35. Anexanteapproach presented several advantages. Itwould produce adurable solution
forsome trade andenvironment conflicts. Itwould contribute tostrengthening juridical security
byintroducing thenecessary predictability forthenegotiation offuture MEAs which conformed to
WTO rules. Itwould avoid establishing ahierarchy between MEAs andtheWTO. Inelaborating
suchasolution, itmust bemade clear thatunilateral measures should conform strictly toWTO
disciplines, thatmultilateral solutions were preferable tounilateral ones, andthattheWTO was
notanenvironmental organization.
36. Trade liberalization wasnotincontradiction totheneedtobetter protect theenvironment.
Aregular dialogue between environmental institutions andtheWTO andbetween authorities
responsible fortrade andforenvironmental matters atthenational levelwasnecessary tofurther
thepursuit ofthese twoobjectives. Inthisregard, hisdelegation welcomed thecontactWT/CTE/M/5
Page10
established between theWTO Secretariat andtheMontreal Protocol Secretariat. Ashadbeen
stated bytheWTO Secretariat attheMontreal Protocol 'slastmeeting, theestablishment ofsucha
dialogue "would appear tobeoneofthebestmeans ofensuring thatanyriskofentering into
potentially conflicting obligations under separate international agreements isavoided".
37. Therepresentative ofAustralia saidtheex-ante approach focused onthedevelopment ofa
setofcriteria toclarify when trade measures taken pursuant toMEAs should beconsidered as
qualifying foranexception under GATT Article XX. Thesame orsimilar criteria could alsobe
applicable toArticle XIVoftheGATS. Asetofcriteria orprinciples should not,however, be
seenaspeculiar toanex-ante approach; itcould alsobeimportant inimplementing anex-post
approach toguide WTO Members intheirconsideration ofarequest forthegranting ofawaiver.
Criteria alsofigured prominently inalternative approaches thathadbeensuggested, suchas
combining theexanteandexpostapproaches. Also, anapproach based onArticle XX(h) would
giveakeyroletothedevelopment ofcriteria orprinciples toclarify when MEAs containing trade
measures should beseenasfalling within itsscope, andwould alsoprovide scope toconsider
MEAs onacase-by-case basis.
38. Further work inrelation toMEAs would benefit from distinguishing between twobroad
issues. ThefirstwastheWTO 'scontribution tointernational efforts tofurther theobjective of
mutually supportive trade andenvironment policies topromote sustainable development. Thiswas
centred onthecontribution which theWTO might make toachieving good policy outcomes on
those environmental concerns thatrequired theuseoftrade measures inMEAs. Thesecond
focused more onlegalthanpolicy questions andinvolved clarifying Members 'WTO rights and
obligations inrelation totrade measures usedinMEAs. Thislegalclarification might bean
important stepincontributing tomutually supportive trade andenvironment policies, and
providing greater certainty andpredictability totrade andenvironment activities. Discussions of
exante,expostandcombined approaches illustrated there were arange ofoptions forachieving a
legalclarification. However, theCommittee 'smandate required ittotakeabroader policy view
andnotfocus onlyonelaborating theoptions forlegalclarification. Principles orcriteria could
bedeveloped toprovide guidance onwhen theuseoftrade measures inMEAs would be
compatible withtheopen, equitable andnon-discriminatory nature ofthemultilateral trading
system. These criteria orprinciples could make animportant contribution toadvancing theaimof
making international trade andenvironment policies mutually supportive andtopromoting an
informed dialogue between trade, development andenvironment communities ascalled forin
Agenda 21.They could alsoprove useful tothose involved inMEA negotiation and
implementation andcould assist them intheirefforts toputintopractice theobjective ofmaking
trade andenvironment policies mutually supportive. They could provide agood basis forthe
Committee 'sfurther consideration ofthevarious options forachieving alegalclarification. In
particular, theycould helpidentify theapproach which would bemost effective inresponding to
thechallenge posed inAgenda 21ofmaking surethatinternational cooperation ontrade and
environment issues wasconsistent andreinforced theprocess ofsustainable development. The
development ofprinciples should draw from experience todatewiththeuseoftrade measures in
MEAs. Astarting point wasthemodel provided byArticle XX,whereby theGATT/WTO had
always recognized there were overriding public policy objectives which required theuseof
measurers inconsistent withitsbasic provisions. Atthesame timeArticle XXinvolved anumber
ofdisciplines andsafeguards toensure these exceptions were usedinaWTO-consistent manner.
39. Theapproach taken inArticle XXrevolved around three keyissues. First, identification
ofthepublic policy objectives itcovered. Second, specification ofthecircumstances inwhich
trade measurers inconsistent withtheother GATT obligations could beused; forexample, the
requirement inArticle XX(b) thatmeasures must benecessary fortheprotection oflifeandWT/CTE/M/5
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health. Third, safeguards toensure fairandequitable treatment ofWTO Members inthe
application ofthetrade measures.
40. Inrelation tothefirstissue, international cooperation toaddress transboundary, regional
orglobal environmental problems wasimportant. MEAs might involve theuseoftrade measures
toprotect anenvironmental resource located outside thejurisdiction ofthecountry imposing them.
Insome cases, thismight beaglobal resource, asintheMontreal Protocol. Inothers itmight be
anenvironmental resource located inanother country, inwhich casetheMEA might reflect the
needforcooperation andashared responsibility between importing andexporting countries to
address aspecific environmental concern, asinCITES andtheBasel Convention.
41. AsaGATT Panel hadnoted, there wasnothing inthetextofArticle XXthatindicated
thatsub-paragraphs (b)or(g)onlyapplied topolicies toprotect living things orconserve
exhaustible natural resources located within theterritory ofthecountry invoking these provisions.
Thissuggested thatArticle XXcould cover policies toprotect animal orplant resources or
conserve natural resources located outside acountry 'sterritorial jurisdiction andthatwere
implemented incooperation withother countries concerned suchasthrough anMEA. Theissue
ofthelocation oftheenvironmental resource being protected needed tobeclearly distinguished
from theseparate issue oftheuseoftrade measures toforce other countries tochange policies
pursued intheirownjurisdiction. Anumber ofpanels hadconcluded thatArticle XXprovided no
cover fortheunilateral useoftrade measures forsuchpurposes. Guidelines should alsoclarify
thattheoverriding public policy objective being addressed could include theprotection of
environmental resources located outside theterritorial jurisdiction ofthecountry imposing atrade
measure specified inanMEA andinclude anumber ofrequirements guaranteeing themultilateral
andopennature oftheMEA. These requirements would ensure thattheagreement hadbeen
negotiated inawaythatwasfairandequitable andwasrepresentative ofabroad range ofthe
international community. Anumber ofthese requirements hadalready beenproposed: for
example, (i)thenegotiating process andmembership oftheagreement should beopenonequal
terms toallinterested countries; (ii)other countries should beabletojointheMEA on
comparable terms toexisting Parties; (iii)theagreement should provide foradequate participation
bycountries withaninterest intrade intheproducts covered.
42. Asecond issue indeveloping asetofguidelines modelled onArticle XXwasthe
specification ofthecircumstances inwhich trade measures inconsistent withother WTO
obligations could beusedtoachieve MEA objectives andwhether itwaspossible tousesuchtrade
measures toadvance MEA objectives inamanner compatible withthebasic principles ofthe
multilateral trading system. Thisissue concerned therange ofproducts which could besubject to
trade measures andtheextension oftrade measures toMEA non-parties. Guidelines modelled on
Article XXwhich, forexample, specified thatthetrade measures must benecessary forachieving
MEA objectives would limittherange ofproducts thatcould beaffected. Thiswould normally
confine trade measures toproducts directly linked toenvironmentally-damaging behaviour, suchas
ozone depleting substances andtoproducts containing those substances intheMontreal Protocol
species subject tospecific trade-related threats inCITES, andwastes defined ashazardous under
theBasel Convention. Thisapproach alsorequired thattheapplication under anMEA oftrade
measures tonon-parties must benecessary fortheachievement oftheenvironmental objectives.
Thetreatment ofnon-parties intheMontreal Protocol, CITES andtheBasel Convention would
appear tofollow thisapproach: (i)trade measures applied tonon-parties inthe
Montreal Protocol, were necessary astheenvironmental goalofprotecting theozone layer would
notbeachieved unless there wasglobal regulation ofODS; (ii)inCITES, theextension tonon-
parties oftherequirements imposed onParties wasnecessary asthegoalofprotecting endangered
andthreatened species through international trade would otherwise beundermined bytrade withWT/CTE/M/5
Page12
non-parties; (iii)intheBasel Convention, theextension tonon-parties oftherequirements
imposed onparties wasnecessary asthegoalofprotecting human health andtheenvironment
against thedangers oftrade inhazardous wastes would otherwise beundermined bytrade with
non-parties.
43. Athirdissue intheArticle XXapproach wasasafeguard toensure fairandequitable
treatment ofWTO Members intheapplication ofthetrade measures used. Article XXachieved
thisthrough itspreamble which imposed lessstrict or"softer" obligations ofMFN treatment and
national treatment thanrequired bybasic WTO provisions. Thissuggested thatthetreatment
accorded tonon-parties should becentred onwhether theymettherequirements necessary for
achieving theMEAs objectives andnotonthefactthattheywere non-parties. The
Montreal Protocol, CITES andtheBasel Convention alladopted thisapproach. While the
Montreal Protocol banned imports ofcontrolled substances from non-parties, itpermitted trade
withanon-party ifaMeeting oftheParties determined thatthenon-party wasinfullcompliance
withthecontrol regime andhadsubmitted datatothateffect. CITES permitted trade withanon-
party onthesame terms aswithParties ifthecompetent authorities inthenon-party hadissued
comparable documentation thatsubstantially conformed withtherequirements ofCITES for
permits andcertificates. While theBasel Convention prohibited trade withnon-parties, Article 11
permitted trade withanon-party ifthattrade wasgoverned byabilateral, regional ormultilateral
agreement thatimposed requirements thatwere notlessenvironmentally sound thanthose ofthe
Convention.
44. Work could focus onexploring three issues inparticular: (i)defining thepublic policy
objective being addressed; (ii)defining thecircumstances inwhich theuseoftrade measures that
might beWTO-inconsistent toachieve thispublic policy objective would becompatible withthe
basic principles ofthemultilateral trading system; and(iii)elaborating safeguards thatcould
ensure fairandequitable treatment ofWTO Members intheapplication ofthese trade measures.
45. Therepresentative ofJapan saidthepoints upon which tofocus discussions were: (i)the
most effective wayofachieving environmental goals; (ii)thecriteria foreligible MEAs; and(iii)
thereconciliation oftrade measures inMEAs withWTO rules. Inthecaseofglobal and
transboundary environmental problems, multilateral cooperation wastheprerequisite foreffective
action. AnMEA wasoneofthemost effective tools fordealing withenvironmental protection.
International environmental cooperation wasmutually supportive andcompatible withthe
preservation oftheprinciples ofinternational trade since bothinitiatives shared theobjective of
attaining thebalance ofequality andfairness.
46. Concerning thecriteria foraneligible MEA, firstthelevelofparticipation hadtobe
considered. MEA Parties should include allthemajor producing andconsuming countries andthe
countries affected bythetrade measures. Thiscondition would contribute tobuilding acommon
ground forpossible jointwork between theWTO andother international organizations. Second,
theMEA should contain aprovision which defined clear conditions under which thetrade
measures could beapplied based onanagreement concerning scientific justification forthe
measures, therealcause oftheproblem andthetrade effect, andthenecessity ofapplying those
measures. Third, theMEA should haveavariety oftools, including non-trade measures. The
costandeffectiveness should beexamined before applying atrade measure, since insome cases it
would beaccompanied bydisadvantages forthirdparties. Itmight alsoriskchallenging the
fundamental principles ofMFN andnational treatment andcould create disguised protectionism.
Therefore, themenu ofremedies inMEAs should consider alternative non-trade measures soasto
minimize theriskoftrade restriction. Assuch, amechanism tomake anoverall judgementWT/CTE/M/5
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concerning thebestmethod from bothanenvironmental andtrade perspective needed tobe
developed.
47. Interms ofreconciling MEAs andtheWTO, theaccommodation oftrade measures
pursuant toaneligible MEA withWTO rules required consideration of:(i)thelegalfoundation;
and(ii)themodality oftheapproval mechanism, namely anex-ante orex-post approach. The
ideaofatrumping clause oracollective interpretation ofArticle XXhadbeenraised, butthissort
ofcomprehensive exanteapproval system raised concerns thatenvironmental protection might
override WTO rules. There alsoexisted adanger oftheWTO 'seventual inability tocheck the
abuse oftrade measures which were disguised protectionism. Thewaiver approach was
considered tobeexpostandWTO approval would bemade onacase-by-case basis. Thiswould
effectively address potential concerns raised bytheexanteapproach. However, there seemed to
beapreference fortheex-ante approach, since anMEA'slegalstability would beassured by
defining inageneric waythestatus ofenvironmental issues within theWTO. TheCommittee
should further examine thetwoapproaches bycomparing theirpositive andnegative effects.
Setting aside thequestion ofhowafinaljudgement should bemade, itwould beuseful todevelop
certain guidelines todetermine which trade restrictive measures would beallowed. These
guidelines could taketheform ofacheck listwhich covered therequirements foraneligible
MEA, including thecause oftheenvironmental problem, levelofparticipation, andscientific
justification fortheuseoftrade measures. Thischeck-list would alsoserve asaguideline for
future MEAs thatmight contain trade restrictive measures.
48. Thedispute settlement mechanism fortrade measures inMEAs needed further discussion.
AWTO Member, non-party toanMEA, could haverecourse totheWTO dispute settlement
process fordisputes concerning trade measures taken pursuant toMEAs. Trade measures for
environmental purposes which were notpursuant toMEAs required acautious approach sothat
WTO-consistency could bemaintained. Here, theriskofprotectionist abuse washighandarigid
discipline wasrequired. Countries should avoid taking unilateral trade restrictions toredress
environmental problems ofatransboundary nature orthatlayoutside theirjurisdiction. Ifitwere
necessary tousetrade measures toprotect theextra-territorial environment, those must bebased
onMEAs among related countries.
49. Therepresentative ofMorocco saidtheuseoftrade measures inMEAs waslinked to
consideration ofGATT Article XX,which allowed countries totaketrade measures toprotect
human, animal andplant lifeandhealth. Discussions onthese issues intheCommittee would
benefit from participation ofexperts from theUN,FAO, UNCTAD andother international
bodies. Theresult could bethepreparation ofadraftamendment toArticle XX(b) containing a
reference toMEAs, ortoaddanother paragraph suchthatMEA Parties could benefit from
preferential treatment ifMEA trade provisions were inconformity withWTO principles andwere
applied without aprotectionist objective. Thedelegation oftheEuropean Communities had
outlined auseful solution totheissue inthisrespect.
50. Therepresentative ofVenezuela saidthattheproposals which hadbeenoutlined under this
Itemwere tantamount torenouncing theprinciple ofnon-discrimination. Three alternatives had
beenraised toensure thecompatibility oftrade measures taken pursuant toMEAs andtheWTO.
Thefirst, which seemed tohavebeendisregarded bymany delegations, wasthatitmight notbe
necessary tomodify theWTO asexiting provisions enabled countries todevelop anenvironmental
policy without acting against WTO provisions. Hesaidthatconsideration ofthisalternative
should becontinued. Inpanel reports which hadincluded anenvironmental aspect, ithadnot
beennecessary forthepanel toevaluate theenvironmental justification ofthemeasures. Thishad
notprevented insome cases ameasure being found tohavebeenapplied inaGATT-consistentWT/CTE/M/5
Page14
manner. Ifsome environment-related trade measures hadbeenfound tobeGATT-inconsistent it
wasbecause theycontravened therules thatrequired ameasure tobenon-discriminatory, theleast
trade restrictive andnecessary according toArticle XX,andnotbecause thepanel haddisregarded
environmental objectives infavour ofarigidsetofnorms thatprevented thedevelopment ofa
national environmental policy.
51. Theproblem posed bynon-discrimination intheapplication ofenvironmental measures
hadtobeexamined. Itwasnotacceptable tofacilitate theadoption ofmeasures which were
contrary toArticles IandIIIasawayinwhich toputpressure oncountries which hadopted, for
legitimate reasons, nottojoinaparticular MEA. Thiswentbeyond theCommittee 'smandate and
would establish anundesirable precedent. Theconcept oflikeproduct should bebetter defined
before considering options concerning theapplication oftrade measures onimported products.
Another element which should beclarified wastheunilateral application ofPPM-based measures
which were WTO-inconsistent. TheCommittee should takeadecision tothiseffect before going
intodetail onthebestwayofadopting anymeasures thatwere WTO-inconsistent. Hisdelegation
considered thatcurrent WTO provisions were sufficient toenable Members toattain legitimate
environmental objectives.
52. Hiscountry hadbeensuccessful intheprocess ofindustrial restructuring required toadapt
tonewandstricter environmental standards, asinthecases oftheInteramerican Commission on
Tropical Tuna andtheMontreal Protocol, where sustainable development models hadbeen
adopted. Thiswasdue,inlarge part,tothetechnical andfinancial cooperation inthese
mechanisms. Nevertheless, hiscountry faced severe restrictions which were notbased on
environmental objectives andwhich were incompatible withWTO provisions. Therefore, itwould
beunacceptable tointroduce changes totheWTO which would allow easier recourse totrade
restrictions forenvironmental purposes unless there were serious efforts toprovide incentives to
assist developing countries toconvert theirindustries andincorporate environmentally sound
technology. Itwasnotnecessary ordesirable tomake anychanges totheWTO which would
havetheeffect ofgiving aloophole fordisguised protectionism. Hesupported theproposal bythe
delegation ofEgypt toexamine thenecessity, effectiveness andproportionality ofenvironmental
measures.
53. Therepresentative oftheUnited States saidthatherdelegation attached importance to
solving environmental challenges through international cooperation andviewed trade measures as
animportant andsometimes central element forachieving environmental objectives inMEAs,
suchastheBasel Convention andCITES. Shenoted theincrease inthenumber andscope of
international environmental negotiations since UNCED. Only alimited proportion ofexisting
MEAs included trade measures, butanexamination ofnegotiations underway indicated that
trade-related elements were being considered. Thisunderlined theimportance ofcoordination
between trade andenvironment officials atthenational andinternational levels, andthe
importance oftheCommittee 'swork. Shenoted thereferences toeffectiveness andnecessity as
criteria tobeconsidered, andquestioned whether MEA negotiators didnotthink about whether
trade measures were necessary andwhether trade measures would beputinplace iftheywere
considered tobeineffective. Iftrade officials considered thattheywould havecome todifferent
conclusions thenthatwasanissue which would bebestworked outincapitals, notinthe
Committee.
54. Document WT/CTE/W/12 provided information onrecent developments inrelevant MEAs
which hadtrade provisions. Itcould beupdated inthefuture on,forexample, theFAO'sCode
ofGood Conduct forResponsible Fishing. Document WT/CTE/W/12 included anannexed setof
questions thattheWTO Secretariat hadprovided totheMontreal Protocol Secretariat onaWT/CTE/M/5
Page15
proposal being considered byParties. Herdelegation wasconcerned thattheWTO Secretariat
hadtaken upon itself tosubmit thislistofquestions. Therecipients ofthequestions might
misunderstand some ofthem tocontain implicit suggestions astothehandling oftheproposal in
question. Also, thequestions might create undue expectations thatasubstantive response might
beforthcoming from thisCommittee. Itwasdifficult torespond toquestions suchasthose that
hadbeenraised bytheMontreal Protocol Secretariat atthisstage inthediscussions. Without a
common understanding ofhowcurrent WTO rules related toMEAs, itwasdifficult toimagine
howtocollectively answer suchquestions. ThefactthattheCommittee wasreceiving such
enquiries underlined theimportance ofwork onthisItem.
55. Therepresentative ofCanada saidthatMEAs should haveclear environmental objectives
andobligations. Theonlyappropriate andeffective waytoaddress transboundary environmental
issues attheinternational levelwasthrough MEAs which hadbroad-based participation. Onthis
basis, WTO rules should notbeanarbitrary impediment totheuseoftrade measures thatmight
beincluded inMEAs. Hereiterated thattrade measures should notbeexpected tobearegular
feature ofMEAs, given thattrade measures were notnecessarily themost effective means to
achieve environmental objectives. Anysuchtrade measure, however, must beclearly specified in
theMEA itself. Hisdelegation 'ssupport formultilateral approaches reflected itsopposition to
unilateral actions. There wasnobasis forproviding authority intheWTO fortheuseofunilateral
trade restrictions toapply environmental programmes orstandards inanextraterritorial manner.
Itisnotforonecountry orgroup ofcountries todecide forothers whataction should betaken
domestically orintheglobal commons. Thedanger ofsuchunilateral actions being captured by
protectionist pressures wasclear. Hisdelegation hadapreference foranapproach tothisissue on
acase-by-case basis thatrecognized MEAs 'evolving nature, asexemplified bytheBasel
Convention; while hisdelegation hadsupported theoriginal trade measures, itopposed therecent
amendment thatexpanded theirscope. Some exanteapproaches could amount tothewriting ofa
blank cheque, without fullknowledge andconsideration ofthenature andfuture effect ofsuch
trade restrictions. Thiswasnotacceptable.
56. Itwasuptonational governments toevaluate theenvironmental objectives andprovisions
ofMEAs, nottheWTO. However, theWTO hadaninterest inspecific trade measures contained
inanMEA inthecontext oftherights andobligations assumed byWTO Members, which could
notbesetaside. Forinstance, inconsidering anArticle XXV waiver approach, itwould be
necessary toknow whatwasexempted from therules andonwhatbasis thatshould bedone, prior
toassessing theimpact ofanyproposed measure. Inaddition toassessing therelative merits of
alternative approaches toaccommodating trade measures inMEAs intheWTO, themerits of
developing guidelines should beconsidered. Guidelines could beaimed atassisting environmental
policymakers intheirconsideration ofthepossible future useoftrade measures inMEAs, would
make itmore likely thatnewtrade measures inMEAs would operate inaWTO-consistent
manner, andwould helptopromote compatibility between trade andenvironmental policies.
57. Therepresentative ofNewZealand saidrecent developments described indocument
WT/CTE/W/12 underscored theimportance ofmaking progress onItem1.Regarding the
questions which were annexed todocument WT/CTE/W/12, herecalled thattheMontreal
Protocol Secretariat hadinitiated theprocess byseeking WTO advice andtheWTO Secretariat
hadnotsought aroleforitself, andsaidhisdelegation wascomfortable withtheSecretariat 's
approach inthisinstance. Herecalled theCommittee 'saimofmaking trade andenvironment
policies mutually supportive, andsupported theimportance ofeffective coordination between trade
andenvironment officials, particularly incapitals. TheCommittee 'staskwastoconsider whether
andhowtheWTO could accommodate theuseoftrade measures which were necessary toachieveWT/CTE/M/5
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legitimate environmental objectives, while atthesame timeensuring thattheydidnotcreate
unnecessary trade restrictions orundermine thetrading system.
58. Therepresentative ofArgentina recalled hisdelegations 'proposal foracombination ofthe
exanteandexpostapproaches, whereby criteria would beadopted toserve asguidelines andasa
compliment toArticle XXfortrade measures inMEAs. Anexanteapproach would be
accompanied byasortofwaiver sothatmeasures under MEAs would beconsistent withthe
criteria which hadbeenoutlined bythedelegations ofAustralia andtheEuropean Communities.
With theadoption ofthenewwork programme, theCommittee 'swork wasnowmore focused and
itwaslikely thatclear cutproposals andresponses would emerge. Progress should notprejudge
orprescribe theresults which would beattained bySingapore. Thefirststepwastoidentify the
problems. Thesecond stepwastopropose solutions. Then solutions would havetobeadapted in
order thatMembers could accept them. Theonlyprecondition hisdelegation considered onthe
outcome oftheCommittee 'swork wasthatthebalance berespected, which didnotmean that
operative andconcrete recommendations needed tobemade onevery Itembutthatthere should be
noItems which were taboo. Hisdelegation would consider theproposal bytheEuropean
Communities, although certain changes totheWTO might beimplicit andthiswould callfora
degree ofprudence. Whatever flexibility wascalled forwithrespect toMEAs, there needed tobe
anunambiguous renunciation ofunilateral action.
59. Therepresentative ofPakistan saidthatfordeveloping countries adegraded environment
waspartly amanifestation ofpoverty andifpoverty andunemployment were notaddressed an
undue emphasis ontheenvironment might leadtonewprotectionism. Many developing countries
were concerned thatincreased environmental standards indeveloped countries would constrain
trade opportunities andefforts tolinktrade andenvironment would create loopholes thatcould be
exploited torestrict trade. Despite some evidence oflinks between trade andenvironment, the
waytodealwiththisissue posed more questions thananswers, suchastheextraterritoriality of
national laws, appropriate dispute settlement mechanisms toensure thatenvironmental policies
were notemployed asdisguised trade restrictions, andtheappropriate roleofenvironmental
subsidies.
60. TheChairman noted thattheSecretariat hadreceived several requests forinformation and
advice from MEAs. There wasnoWTO procedure which would permit ittoadequately reply to
suchrequests andtheestablishment ofnewprocedures wentbeyond theCommittee 'smandate and
wasofinterest totheWTO ingeneral. Forthisreason, hehadreferred thismatter tothe
Chairman oftheGeneral Council who, heunderstood, would beconsulting ontheissue. After
theGeneral Council hadtaken upthismatter, hewould inform theCommittee oftheresults.
61. There were several views onhowtotackle Item1,thestatus quo,exanteandexpost
approaches. Henoted there wasacertain similarity between thestatus quoandtheexpost
approaches. Other delegations preferred acombination oftheapproaches which hadbeen
outlined, andseveral possible solutions existed inorder toensure thecompatibility ofMEAs
which contained trade measures andWTO provisions. Among thesolutions which were being
explored were achange inArticle XX,thedevelopment ofprinciples, thedrawing upofan
interpretive understanding, andthepossibility ofsetting upprocedures tobefollowed bydispute
settlement panels indealing withenvironment-related matters. Another aspect wasthenon-party
issue. Inthisregard, there wasaclose linkbetween Items 1and5,which related tothedispute
settlement procedures inMEAs andtheWTO. Allthese aspects would havetocontinue tobe
explored.WT/CTE/M/5
Page17
Item3(a)
Therelationship between theprovisions ofthemultilateral trading system and
charges andtaxes forenvironmental purposes
62. Therepresentative ofCanada reiterated hisdelegation 'sconcerns about ecotaxes which it
hadoutlined attheOctober 1994 meeting. Theconcern wasnotabout national measures aimed at
addressing thelocalimpact ofproducts attheconsumption ordisposal stages. Theeffectiveness
ofeco-taxes wasenhanced iftheywere applied toallproducts being consumed anddisposed ofin
thedomestic markets, andWTO transparency, MFN andnational treatment obligations would
havetobemet. Rather, theconcern wasabout measures aimed atlocalenvironmental impacts at
theproduction stage incountries ofexportation, because ofconcern overthetransboundary impact
oftheapplication ofdomestic non-product related PPM standards toimports. Thisreflected his
delegation 'sfundamental belief thatharmonization ofnon-product related PPM requirements was
ingeneral notenvironmentally desirable given different absorptive capacities, asrecognized in
Principle 11oftheRioDeclaration, andimporting country standards might notbe
environmentally appropriate intheexporting country. Henoted thedanger thatthese standards
could becaptured byprotectionist interests.
63. Therepresentative ofNewZealand saiditwaspreferable tocontinue tofocus firstonthe
generic usefulness ofborder taxadjustments (BTAs) forenvironmental purposes. Herecalled his
delegation 'sanalysis attheSeptember 1994 meeting oftheeffect ofBTA onincreasing or
decreasing theeffectiveness ofthedomestic environmental charge ortax.Hisdelegation had
presented several scenarios toexamine thegeneric effect ofextending domestic environmental
taxes totheWTO through BTA. Thefirstcasewaswhere thedomestic taxorcharge was
imposed toaddress environmentally unfriendly localproduction. Theconclusion herewasthat
imposing thetaxorcharge onimports ofthelikeproduct orexempting exports ofthatproduct
would reduce theeffectiveness ofthedomestic taxorcharge inachieving theenvironmental
objective. Therefore, taxes andcharges aimed atproduction externalities might bemost effective
when there wasnoBTA. Thesecond casewaswhere thetaxorcharge addressed
environmentally unfriendly domestic consumption; here, imposing thetaxorcharge onexports of
theproduct, orexempting imported likeproducts, would reduce theeffectiveness ofthetaxin
achieving theenvironmental objective. Therefore, BTA would contribute totheeffectiveness of
thedomestic taxorcharge. Another scenario waswhere thetaxwasonaninput which was
consumed intheproduction process. Theconclusion wasthatforBTA toaccount forthevalue of
theinput taxcontained intheprice ofthefinalproduct would runcounter totheenvironmental
objective. BTA would therefore notbeappropriate forimports orexports ofthefinalproduct.
They would, though, beappropriate forimports orexports oftheinput.
64. Having examined inageneral waythecaseofasingle country, hisdelegation had
examined theglobal ortransboundary case. Thethirdcase, therefore, waswhere production had
atransboundary environmental externality. Theconclusion wasthatexempting exports from
domestic taxes orcharges would reduce theeffectiveness inachieving theenvironmental objective.
Forimports, thesituation wascomplex andmore work wasneeded. Thefinalcasewaswhere
consumption hadtransboundary environmental externalities andthemain conclusion wasthat
BTAs onimports would contribute totheeffectiveness ofthedomestic measure. Thesituation for
exports wasmore complex. Itwasnecessary fortheCommittee tocontinue tobearinmind such
general considerations inapproaching theBTA issue.
65. Therepresentative ofSwitzerland saidtheuseofeconomic instruments, specifically eco-
taxes andcharges, wasefficient andinnovative. Thetrade effects ofeco-taxes depended ontheWT/CTE/M/5
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manner inwhich theywere conceived, themarket inwhich theywere applied andthestage ofthe
lifeoftheproduct. During theestablishment andtheimplementation ofaneco-tax, account
should betaken ofWTO rules inorder toavoid undesirable trade effects andthese measures
should betransparent andrespect national treatment. Thetrade effects ofeco-taxes onproducts
andonPPMs should beclearly distinguished. Ashadbeennoted bythedelegation ofArgentina
attheSeptember 1995 meeting, product taxes were desirable from atrade perspective astheydid
notinclude anydistortions iftheywere applied attheconsumption stage andtheyaffected equally
domestic andimported products. According tothe1970 GATT Working Party conclusions, a
BTA waspossible fortaxes which were imposed directly onaproduct. These taxes were WTO
compatible asnational treatment wasrespected. Theproblem wasmore complicated withrespect
totaxes onPPMs, which were domestic bydefinition, affected exclusively domestic producers
andthuscould place them inanunfavourable competitive position since taxes differed from one
country toanother. Itwasconsidered thatWTO rules permitted BTA forinputs incorporated in
thefinalproduct butnotforunincorporated PPMs. Anenergy taxwould appear tobeexcluded.
However, footnote 61ofAnnex IIoftheSubsidies Agreement suggested adifferent conclusion.
TRE/W/20 (paragraph 34)stated that: "presumably thisfootnote would allow forexemption,
remission ordeferral oftaxes levied ontheenergy, fuel,and/or oilinputs consumed inthe
production ofanexported product. Thiscould haveimportant implications forcompetitiveness
issues thatoften arose withregard toproposals forsuchenergy taxes". Thisissue would haveto
beexamined further asitcould influence work oneco-taxes. Herequested theSecretariat to
prepare adocument onthenegotiating history ofprovisions concerning BTA intheSubsidies
Agreement.
66. Therepresentative ofMexico saidthatthemain concern under thisItemdidnotrelate to
national measures whose purpose wastoaffect thelocalenvironmental impact ofproducts, either
through consumption ordisposal. Theeffectiveness ofthese measures were clearly established
andsubstantiated. Themain concern wasmeasures imposed onenvironmental externalities inthe
production process ofother countries. Theeffectiveness oftaxes andcharges inthiscasewas
dubious. These elements should bereviewed onthebasis ofinformation compiled from national
experience. Theanalysis should distinguish between thefourdifferent types ofexternalities which
hadbeenidentified byNewZealand, which could serve asabasis forfurther discussion.
67. TheChairman saidthattheCommittee would discuss thisiteminFebruary 1996 and
focus ontheadjustment ofenvironmental taxes attheborder andtheirWTO-consistency. The
Secretariat would prepare astudy onthenegotiating history ofprovisions concerning BTA inthe
Subsidies Agreement.
Item3(b)
Therelationship between theprovisions ofthemultilateral trading system and
requirements forenvironmental purposes relating toproducts, including standards
andtechnical regulations, packaging, labelling andrecycling
68. Therepresentative ofCanada saidthisItemaddressed concrete market access problems
faced bymany Members andananalysis ofthecurrent trade disciplines oneco-labelling
programmes would serve toprovide some guidance totherelated issues ofpackaging, technical
regulations, standards, andrecycling requirements. Discussions would beguided bydocument
WT/CTE/W/10 onthenegotiating history oftheTBTAgreement anddiscussions intheTBT
Committee. Eco-labelling should beconsidered under fouraspects: transparency, government
participation, life-cycle analysis, andwork inother fora. Transparency wasbasic toWT/CTE/M/5
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understanding thescope ofanyissue. Asnoted hereandintheTBTCommittee, theapplication
oftheTBTtransparency provisions toeco-labelling programmes could helptoaddress some ofthe
substantive concerns regarding these initiatives. Notification withaprior comment period was
fundamental. Inthisregard, document WT/CTE/W/10 wasclear that,according totheTokyo
Round Decisions andtheTBTCommittee, mandatory labelling requirements were subject to
notification provisions regardless ofthekindofinformation thatwasprovided onthelabel.
Furthermore, byimplication, voluntary labelling standards were subject tothenotification
provisions ofArticle 4andAnnex 3.Thus, itappeared thateco-labelling programmes were well
within thescope ofthenormal TBTnotification procedures. Notification under theTBT
Agreement would ensure thatgovernments andindustry would beprovided withboththeneeded
information andanopportunity forprior comment. TheCommittee might needtoconsider
whether further transparency provisions were required forvoluntary labelling standards, butit
should ensure thattheTBTnotification disciplines formed thebasis forsuchtransparency. His
delegation wasprepared tonotify formally current andfuture eco-labelling schemes andhoped
thatother Members would alsoconsider notification oftheirs.
69. Document WT/CTE/W/10 clarified thattheTBTAgreement wasintended tocover both
mandatory andvoluntary eco-labelling programmes. Forvoluntary programmes, Article 4.1
established astrong obligation onMembers totakesuchreasonable measures aswere available to
them toensure thatlocalgovernments andnon-governmental standardizing bodies within their
territories accepted andcomplied withtheprovisions oftheTBTCode ofGood Practice. As
noted indocument WT/CTE/W/10, thiswording wasdrafted tobeconsistent withGATT Article
XXIV:12. Furthermore, asurvey ofexisting eco-labelling programmes indicated thatmost had
beendeveloped andimplemented withsome degree ofgovernment involvement. Government
involvement might notnecessarily guarantee greater credibility norgreater market impact butit
wasrelevant totheability toensure thateco-labelling programmes conformed tointernationally-
agreed norms ordisciplines. Widespread government involvement inthese programmes provided
thenecessary lever toensure suchconformity andthedifferences between firstandsecond levels
ofobligations were inmost cases academic. Hisdelegation considered thateco-labelling
programmes were covered bytheTBTAgreement interms ofthebasic discipline oftransparency
anditsrelated obligations. Thisshould form thebasis fordiscussion regarding thepossible need
forfurther trade disciplines. Theissue ofcoverage waswithin theTBTAgreement 'smandate,
given thelabelling decision andtheeffective degree ofgovernment involvement insuch
programmes. Theissue ofthepossible needforfurther disciplines onother issues relating toeco-
labelling wasashared mandate between thisCommittee andtheTBTCommittee.
70. Eco-labelling programmes, incontrast toother labelling programmes, were based toa
significant extent onnon-product related PPMs given theirextensive useoflife-cycle analysis
(LCA). Document WT/CTE/W/10 clarified howcomplex thePPM issue hadbeenfortheTBT
Agreement. Hisdelegation supported thestatement indocument WT/CTE/W/10 thatthe
"negotiating history suggests thatmany participants were oftheviewthatstandards based inter
aliaonPPMs unrelated toaproduct 'scharacteristics should notbeconsidered eligible forbeing
treated asbeing inconformity withtheTBTAgreement". Hisdelegation 'sunderstanding, based
upon discussions withthenegotiators atthetime, wasthatthere wasnointent toprovide scope for
non-product related PPMs. TheCommittee wasfaced withtheapparent paradox ofTBTcoverage
ofeco-labelling programmes, without anyscope forthecentral element ofLCA, i.e.non-product
related PPMs. Thisaspect ofeco-labelling programmes could notbeignored. Heconsidered
thatitwould bebeneficial toconsider themerits andthefeasibility ofextending WTO andTBT
disciplines tonon-product related PPMs. Given thattheTBTAgreement encouraged Members to
participate inandadhere tointernational standards, thiswould provide some means tobring some
non-product related PPMs, forwhich there wasinternational consensus, under TBTdisciplines.WT/CTE/M/5
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TheCommittee should examine whether suchinternational standards andcriteria would provide
themeans tobring non-product related PPMs based environmental standards within TBT
disciplines. Inanumber ofother fora, including theISO,UNEP andUNCTAD, work was
underway toadvance international cooperation inthedevelopment andimplementation of
environmental programmes likeeco-labelling. Consideration should alsobegiven toMutual
Recognition Agreements whereby theobjectives, requirements andconformity assessment
procedures ofaprogramme could beacknowledged asbeing equivalent tothose ofanother
programme, while notnecessarily identical. Hisdelegation emphasized theadvantages of
multilaterally-agreed criteria given theconcern overunilateral measures. Thisconcern was
particularly pertinent tonon-product related PPMs, given thatthese would reflect unique national
orregional characteristics ortechnologies. Onefactor thatmust betaken intoaccount inareview
ofother fora'sactivities wasthedegree towhich theirwork hadbroad international support and
participation.
71. Discussion ofallissues under Item3(b)should keepinmind thebasic WTO andTBT
disciplines ofnon-discrimination, national treatment andminimal trade distortion. Given that
elements ofthisItemwere possible barriers todeveloping country exports, increased trade
disciplines onsuchmeasures might notbesufficient. Hisdelegation considered thattheneedfor
technical assistance should beacknowledged andthattheInternational Trade Centre should
continue toprovide developing countries withexpertise andadvice inmeeting these requirements.
Also, aninformal jointmeeting oftheCommittee andtheTBTCommittee should beheldinthe
nearfuture. Hereiterated hisdelegation 'soffer totheTBTCommittee topresent Canada 's
Environmental Choice Programme toassist inanunderstanding ofthepractical aspects ofeco-
labelling.
72. Therepresentative oftheEuropean Communities focused onvoluntary eco-labelling
schemes based onLCA which were increasingly recognized asanimportant instrument of
environmental policy. Forexample, Agenda 21recognized thattherecent emergence inmany
countries ofamore environmentally conscious consumer public should beencouraged. Tothis
end,governments hadbeenrequested to:(i)develop criteria andmethodologies forthe
assessment ofenvironmental impacts andresource requirements throughout thefulllife-cycle of
products; and(ii)encourage expansion ofenvironmental labelling toassist consumers inmaking
informed choices. LCA wasbased onthedefinition ofrelevant product groups andrelated
environmental criteria, which covered theentire cradle-to-grave product life-cycle, including the
rawmaterials used, PPMs, distribution, enduseandfinaldisposal. Ecolabelling schemes based
onLCA hadonlyalimited impact ontrade. Aslongastheywere ofavoluntary nature, aswas
thecaseoftheECscheme, theydidnotresult intheestablishment oftrade restrictions for
unlabelled products. Therefore, onpurely trade grounds, theywere preferable toother
conventional instruments ofenvironmental policy. However, discussions intheCommittee
illustrated thattheLCA approach and,inparticular, theapplication ofPPM-related criteria to
imported products raised specific concerns. TheECeco-labelling scheme inparticular hadbeen
citedinthisrespect, despite thefactthatthere were many voluntary eco-labelling schemes based
onLCA worldwide, notonlyinOECD countries, andthatsome ofthem were lesstransparent and
more developed. Infact,theEChadmade asignificant effort topromote dialogue and
consultations withthirdcountries andforeign suppliers intheinitial stages ofdeveloping its
ecolabelling scheme.
73. Hisdelegation 'sposition onecolabelling wasarticulated around fivefundamental
principles: (i)Increased WTO transparency intheoperation ofecolabelling schemes was
desirable. Even ifitcould beargued thatvoluntary eco-labels were "soft" instruments compared
totraditional instruments ofenvironmental policy andhadalimited trade impact, theperception ofWT/CTE/M/5
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potential trade impacts revealed theneedtoenhance transparency. AWTO transparency regime
would alsoprevent possible disputes byensuring thatallcountries withsignificant trade interests
could havetheirviews heard throughout theentire process, including thedefinition ofproduct
groups, theelaboration ofecolabelling criteria andtheaward ofthelabels. Atthesame time, a
WTO transparency regime could bedesigned insuchawayastoenable industry, consumers and
environmental NGOs inthirdcountries tosubmit theircomments andsuggestions. (ii)The
outcome oftheCommittee 'sdiscussions should bebalanced andcomprehensive. While themain
objective should betoincrease transparency, itwould alsobenecessary toensure respect forsome
substantive principles, inparticular toavoid possible trade distortions anddiscrimination between
domestically produced andimported goods. Afundamental requirement wasthatboth
governmental andnon-governmental schemes should besubject tothesame requirements. No
differential treatment based ontheirpredominantly governmental ornon-governmental nature
would bejustified. Since governmental involvement orsponsorship didnotnecessarily make a
voluntary eco-labelling scheme more successful, non-governmental schemes could havethesame
orgreater trade effects thangovernmental ones. Itwas,therefore, essential todevise effective
andenforceable mechanisms toensure thatnon-governmental schemes were transparent andnon-
discriminatory. (iii)Theintegrity oftheLCA ("cradle-to-grave") approach should bepreserved.
Allecolabelling criteria established foreachcategory ofproducts, including PPM-related criteria,
should betaken intoaccount when awarding thelabels tobothdomestically produced and
imported goods. Similarly, itshould beconsidered whether there might besome kindof
inconsistency between theLCA approach andWTO provisions and,ifnecessary, appropriate
solutions should bedevised. (iv)TheCommittee 'sdeliberations should initially focus onthe
transparency issue. International harmonization ofeco-labelling procedures andmutual
recognition oflabels might offer aneffective solution toaddress potential trade impacts inthe
operation ofeco-labelling schemes. However, inviewofthedifficulties involved, itdidnotseem
possible toachieve immediate results inthisarea. Itwould bepreferable tofollow astep-by-step
approach inorder tobeabletodeliver concrete results assoonaspossible. Discussions should
focus initially onthetransparency issue, taking intoaccount thatimproved mechanisms for
consultation were animportant instrument foravoiding potential conflicts. Nevertheless,
international harmonization andmutual recognition remained important policy objectives. His
delegation waswilling toparticipate inthework underway inseveral international fora, suchas
ISO,UNCTAD, andOECD, andconsidered thatallinternational activities relevant tothe
international harmonization ofecolabelling schemes should beencouraged. (v)Thespecific needs
andrequirements ofdeveloping countries should befullytaken intoaccount intheestablishment
andoperation ofeco-labelling schemes. Itwasessential toavoid possible negative impacts on
developing country exports, whose special development, financial andtrade needs should betaken
intoaccount inthedesign andimplementation ofeco-labelling schemes. Developing countries
should begiven advice andtechnical assistance regarding theestablishment ofecolabelling
schemes tohelpthem achieve theirownenvironmental objectives andtopromote exports of
environmentally-friendly goods tocountries withahighlevelofconsumer environmental
awareness.
74. Hisdelegation considered thatthefirsttaskwastoclarify thescope oftheTBT
Agreement todetermine whether itapplied tovoluntary eco-labelling schemes based onLCA,
specifically whether suchprogrammes fellwithin thedefinition ofastandard inAnnex 1.His
delegation wasaware thattheCommittee didnothavethecompetence tointerpret theTBT
Agreement. Theanalysis indocument WT/CTE/W/10 illustrated thattheintention oftheTBT
negotiators hadbeentoexclude from itscoverage PPM-based specifications which didnotaffect
products assuch. Therefore, ecolabelling schemes based onLCA, which bydefinition included
product andnon-product-related PPM criteria, would notbeentirely covered bytheTBT
Agreement. Apartial coverage could intheory bepossible, ifeachofthecriteria established forWT/CTE/M/5
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acategory ofproducts were considered asaseparate rule,guideline ofcharacteristic. However,
inpractice, apartial coverage ofeco-labelling schemes under theTBTAgreement, excluding non-
product-related PPM criteria, would notbeanappropriate solution, eventhough itwould bea
firststepinthedirection ofenhancing transparency.
75. Intheoperation ofmany ofthese schemes, including thatoftheEC,allcriteria
established foraspecific category ofproducts, whether related totheproduct ortothePPMs
used, hadtobejointly considered when awarding thelabels. Apartial coverage ofeco-labelling
schemes bytheTBTAgreement would notmeettheconcerns expressed intheCommittee 's
discussions which hadfocused ontheapplication ofPPM-related criteria toimported products. It
hadbeenargued that,inaccordance withadecision adopted bytheTBTCommittee, mandatory
labelling requirements were subject toTBTprovisions regardless ofthekindofinformation that
wasprovided onthelabelandthat,byimplication, voluntary labelling standards should alsobe
subject toallrelevant TBTprovisions. However, thisargument wasnotentirely convincing.
First, itmight beinappropriate toapply adecision which onlyreferred tomandatory labelling
requirements tovoluntary labelling schemes. Second, inmost eco-labelling schemes based on
LCA, thelabelconsisted ofasymbol andcontained littleornoinformation atall.Themost
important element wasnottheinformation contained onthelabelbutthecriteria products hadto
meetinorder tobeawarded thelabel.
76. Inviewoftheremaining legaluncertainties concerning thescope oftheTBTAgreement,
hisdelegation considered thattheCommittee, incooperation withtheTBTCommittee, should
consider twopossible options: (i)seeking fullcoverage bytheTBTAgreement ofvoluntary
ecolabelling schemes based onLCA; or(ii)negotiation ofanadhoccodeofconduct. Thefirst
option might offer some practical advantages inviewofthefactthatthemechanisms and
procedures established intheTBTAgreement were already inplace andwellknown. However, it
would benecessary toassess thelegal, practical andinstitutional implications oftheTBTrules on
theoperation ofvoluntary eco-labelling schemes based onLCA which hadonlyalimited trade
impact. Thisoption would require anagreement ofWTO Members, forexample intheform of
anunderstanding. When negotiating suchanunderstanding, theimplications ofsome oftheTBT
rules fortheintegrity ofLCA should beconsidered and,ifnecessary, specific safeguards should
beestablished. Themain advantage oftheelaboration ofanadhoccodeofconduct wasthatit
could betailored tomeetspecific transparency requirements intheoperation ofeco-labelling
schemes without introducing unnecessary procedural constraints. Also, itcould include some
substantive provisions inparticular toavoid discrimination inthedefinition ofproduct groups and
criteria andintheaward ofthelabels. Itwould alsobepossible tocombine bothoptions. For
example, theprovisions ofapossible codeofconduct could, insubstance, reflect theconsensus of
WTO Members toapply TBTprocedures totheoperation ofvoluntary eco-labelling schemes
based onLCA. Itwasimportant tonotethatitwould benecessary toensure, under bothoptions,
thatequivalent treatment wasgiven togovernmental andnon-governmental eco-labelling schemes.
Hisdelegation considered thattransparency should bethefirstpriority andthattheoutcome ofthe
Committee 'swork should becomprehensive andbalanced andpreserve theintegrity ofLCA,
while maintaining theopen, equitable andnon-discriminatory nature ofthetrading system and
taking intoaccount theneeds ofdeveloping countries.
77. Therepresentative ofChile referred totheinterests ofmany developing countries in
increasing WTO transparency ofeco-labelling since there wasconcern thatitsnegative effects
could affect theirtrade. Hesaidthatitwould benecessary toconsider newprovisions toimprove
thenotification processes contained inWTO Agreements. Itwould beuseful toconsider the
transparency ofstandards intheTBTAgreement, inparticular those contained intheCode of
Good Conduct. Concerning improved access toinformation oneco-labelling, governments shouldWT/CTE/M/5
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ensure thatnational, private andpublic bodies involved inthedevelopment ofeco-labelling should
givethenecessary information sothatitwaspossible tocomply withtheCode ofConducts '
minimum provisions, i.e.publish standards under preparation andthose adopted atleastevery six
months andallow atleast60daysforinterested parties tosubmit comments. Itwaspremature to
consider whether theapplication ofthese notification provisions would besufficient tosatisfy
requests forinformation oneco-labelling, buttheywould provide forgreater transparency.
78. Therepresentative ofMalaysia, onbehalf ofASEAN, saiddocument WT/CTE/W/10
underlined oneoftheproblems intheareaoflabelling wasthatregulations were often toodetailed
orunnecessarily stringent andcould constitute trade obstacles. Thissituation could notcontinue.
Inprinciple, labelling requirements toadvance sustainable development were appreciated.
However, schemes were being promoted inthename ofsustainability which were coloured by
political andeconomic expediency. There wasaneedforaglobalization ofthesustainability
issue. Labelling requirements should bebased onthegenuine needtoensure sustainability, for
example withrespect totheneedtoensure thesustainability oftheworld 'sforests. Therefore the
coverage oflabelling schemes should include bothtemperate andtropical timber. Theideaof
necessity oreffectiveness wasrelevant. Studies hadshown thattrade intimber hadnot
contributed significantly toenvironmental degradation andthatconsideration hadalsotobegiven
totheunderlying causes ofdegradation brought about bypoverty andindebtedness. Asaproduct,
timber competed toacertain extent withsubstitute materials inthemarket place, suchasplastic,
aluminium andsteel, andthese products should becovered bysimilar measures regarding
sustainability. Another relevant aspect specifically inthetimber casewastheproliferation of
unilateral initiatives inconsuming countries. There wasalready aglobal initiative underway andit
should besupported byallrelevant parties, including governments andinternational organizations,
from bothproducing andconsuming countries. Acredible timber labelling scheme required a
realistic andsuitable implementation timeframe which hadtobebased onandshould notbeearlier
thantheagreed timetable bywhich allforests were brought under sustainable management.
ITTO 'sobjective oftheyear2000 hadgained increasing acceptance astheyearbywhich
sustainability should beachieved. There should notbeanyinitiative thatcould cause confusion
suchastrying tobring thatdateforward. Hesaidthathisdelegation wasnotagainst labelling,
butthatitshould befair,equitably implemented andnon-discriminatory. Aspointed outin
document WT/CTE/W/10, applicable WTO provisions, specifically GATT Article III,needed to
berespected.
79. Therepresentative ofSwitzerland saidhisdelegation viewed eco-labelling from a
horizontal perspective asvoluntary eco-labelling programmes were increasingly usedasan
instrument topromote different environmental objectives. Voluntary eco-labelling wasachallenge
fortheWTO. Such market-based instruments would playanincreasing roleintheareaofmarket
access. Negotiators hadwanted tointegrate these standards intotheTBTagreement asithadbeen
recognized thatdespite thefactthattheywere voluntary theycould haveanindirect influence on
access tospecific markets. Thisissue needed tobeaddressed inorder toclarify the
implementation oftheTBTAgreement. Work should concentrate ontransparency and
government participation ineco-labelling programmes. Current TBTprovisions allowed acertain
degree oftransparency foreco-labelling programmes intheCode ofGood Practice andhis
delegation insisted ontheneedtoreach aconsensus ontheirnotification. Concerning government
participation, Article 4,which covered different levels ofgovernment participation, could be
examined based onwhether these were standard-setting bodies. Governments intervened in
diverse ways ineco-labelling programmes. Theissue ofPPMs unrelated tothecharacteristics of
aproduct, which wasraised inthecontext ofvoluntary eco-labelling programmes thatwere based
onLCA, wassocomplex thatitwasdifficult toviewitsolely from theeco-labelling perspective.WT/CTE/M/5
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80. Therepresentative ofKorea saidmost eco-labelling schemes were based onLCA andwere
voluntary innature. Even though theywere applied inthesame waytobothdomestic andforeign
suppliers, theycould havedefacto discriminatory trade effects resulting from theselection of
products, categories andcriteria, orfrom thethreshold levels fortheaward ofthelabelwhich
effectively tended toraisetheadjustment costs andlimitmarket access forforeign suppliers. Eco-
labelling schemes could cause discriminatory effects onmarket access when theyincluded criteria
onnon-product-related PPMs. TheTBTCode ofGood Practice wasastarting point for
addressing these discriminatory effects. Document WT/CTE/W/10 clarified thatitwastheintent
ofthenegotiators toexclude technical regulations andstandards based onPPMs requirements
which didnothaveanyimpact onproduct characteristics. Hisdelegation 'sviewwasthatthe
intent ofthenegotiators hadtoberespected andthattheCommittee should becautious regarding
anyinterpretation orextension ofthecoverage oftheTBTAgreement which might beconsidered
tobenecessary toaddress thediscriminatory trade effects ofeco-labelling schemes. Anattempt
toregulate thetrade effects ofeco-labelling schemes through TBTdisciplines would opentheway
forincorporating non-product-related PPMs intheWTO, whether itwasintended ornot.Thus,
theCommittee would needtolookforother means toaddress theproblem, taking advantage of
progress which hadbeenachieved intheother fora.
81. Eco-labelling schemes based onnon-product-related PPMs criteria which didnothaveany
environmental impact ontheimporting country, eventhough theywere voluntary, hadtheeffect
offorcing theexporting country toadopt theimporting country 'senvironmental standards and
priorities. Each country hadarighttohaveitsownenvironmental policy priorities, andthe
environmental capacities anddevelopmental needs ofeachcountry should beconsidered whenever
environmental policy measures, mandatory orvoluntary, were likely tohaveextra-jurisdictional
effects. Inthisregard, hisdelegation attached importance tothedevelopment oftheconcept of
"equivalence" or"mutual recognition" andtotheirpotential roleinavoiding thediscriminatory
trade effects ofeco-labelling schemes. TheTBTCode ofGood Practice didnotcontain any
provision onequivalence ormutual recognition and,assuch, work inrelevant international fora,
suchasUNCTAD, UNEP andpossibly ISOshould befollowed.
82. Therepresentative ofIndia saiditwasafactthatlabelling requirements were more
onerous forproducts from developing countries andtheyplaced adisproportionate burden ontheir
trade. Hisdelegation hadoften referred tothecritical rolethattechnical assistance programmes
played inthiscontext. Hehoped thatsuchprogrammes would bedeveloped inmanner which
would benefit developing country exports. Hisdelegation wasinfavour oflabelling requirements
which were based oninternational standards andconsidered thatsuchstandards, onceadopted at
thenational orlocallevel, must benotified through aresponsible national body sothat
information andtransparency needs were met. Itwasnothisintention togointothecomplex
issue ofPPMs, onwhich theposition ofhisdelegation waswellknown. Theconcept ofPPMs,
which involved theconcept ofextra-territoriality, wasunacceptable asitsought toimpose the
standards adopted byonecountry onanother.
83. Therepresentative ofEgypt saidthattheissue ofeco-labelling wascomplex. Itraised
questions which didnothaveadequate answers, andcutacross other items, suchastransparency,
competitiveness, market access andtherelationship between environmental policies with
significant trade effects andWTO provisions. Heenquired whether eco-labelling schemes passed
thenecessity andleasttrade restrictive tests; howeco-labelling schemes, involving judgements
about environmental friendliness orpreferability could bedesigned inawaytoeffectively
communicate thepossible trade-offs among different environmental impacts; whether there wasa
possibility thateco-labelling schemes might bebased onfalseormisleading information about the
environmental attributes ofthetraded goods which would inturnleadtoinefficient resourceWT/CTE/M/5
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allocation andwelfare loss; whether market outcomes based ondecisions made withkey
information deficiencies might belessthanoptimal; theeffect those schemes might haveonthe
environment itself; and,iftheenvironmental effect waspositive, would itbesoinall
circumstances?
84. Eco-labelling which aimed toachieve acertain environmental goalthrough encouraging
demand forenvironmentally friendly products could leadtoprecisely opposite results. Thereason
wasthatifenvironmentally motivated consumers were willing topayevenaslightly higher price
forthelabelled product, aggregate demand inthepostlabelling situation waslikely tobehigher
thaninthepre-labelling situation. Hence, thefinalequilibrium price ofallproducts labelled and
unlabelled would behigher thantheprice before labelling hadbeenintroduced. Thisimplied that
theproduction ofboththelabelled andunlabelled products would belikely toincrease. Unless
policy makers were informed about theconditions ofsupply anddemand, theconsequences of
indirect environmental measures likelabelling were notalways predictable. Iftheenvironmental
benefits ofeco-labelling schemes astheywere applied nowwere doubtful, wasitpossible tosay
thateco-labelling passed thenecessity andleast-trade-restrictive tests?
85. Setting criteria forawarding eco-labels required judgements onthewhole lifecycle ofa
product. There were some models forinternal LCA, butthere wasnointernational consensus on
anacceptable model asareference forcomparisons between producers, processes orproducts, nor
were there agreement ontheroleofLCA asapublic policy tool. There wasstillalongwayto
gobefore reaching thestage where LCA wasbased onvalidated scientific methods toavoid
arbitrary hierarchies, evaluate trade-offs andcomplexities among various environmental
parameters, anddealadequately withdifficult questions ofenvironmental costvaluation.
Outstanding questions about theeconomic andenvironmental rationale ofeco-labelling hadtobe
answered inorder tobeabletoaddress theissue of"necessity" and"least-trade-restrictiveness"
andfindoutifthere were more reasonable andrealistic alternatives.
86. Hisdelegation considered thatthetrade issues related toeco-labelling, including the
relationship between eco-labelling andthedisciplines oftheTBTAgreement, raised many
questions, suchas:Ifeco-labelling wasdesigned toallow consumers todiscriminate between like
products inmaking purchasing decisions, howcould discrimination between locally produced and
imported products beavoided? While thelabeldidnotinitself prevent theimport andsaleof
foreign products notcarrying thelabel, itcould surely haveasignificant trade impact, might lead
toanegative demand shock forforeign producers, andwould undoubtedly create abarrier to
entry intothemarket fortheirproducts. Even ifthesame standard wassetforbothdomestic and
foreign producers, there might bedefacto discrimination because ofunequal access to
environment friendly technology. Production standards could alsobesetinsuchafashion thatit
waseasyforhome producers tomeet, butnotforforeigners. Itwasinfactnotdifficult tosee
howthesystem could beuseddeliberately orallowed unwillingly tobecome abarrier toentry for
foreign products. Access tothelabelled segment ofthemarket might involve increased costs for
allfirms, butifdomestic firms were initially closer totherequired standard there would bea
greater increase incosts fortheirforeign competitors. Relatively highcostfirms were likely to
havethegreatest incentive toacquire thelabelwhen standards implied anincrease inmarginal
costs toacertain level. Thecriteria ofenvironmental friendliness might thenconflict with
comparative advantage.
87. Hisdelegation considered thatfurther clarification oftherelationship between eco-
labelling andtheprovisions oftheTBTAgreement wasneeded. Towhatextent dideco-labelling
raiselegalandpolicy questions about thedistinction between "voluntary" and"mandatory" eco-
labelling programmes? Didthedegree ofgovernment involvement inthedevelopment orWT/CTE/M/5
Page26
implementation ofaneco-labelling scheme affect thisvoluntary-mandatory distinction? Towhat
extent didthetrade implications ofeco-labelling schemes thatinvolved sealofapproval labels or
overall lifecycle assessments andjudgements about "environmentally preferable" products differ
from those aimed atinformation disclosure only? Some seemed toquestion theapplicability of
theTBTAgreement toeco-labelling forfearoflegitimizing trade distinctions among products
based onPPMs unrelated totheproduct, intheTBTAgreement aswellasmore broadly inthe
GATT. Specifically, national treatment might mean thattheapplication toimports ofPPMs
unrelated totheproduct would beallowed aslongasdomestic production wasalsosubject tothe
same PPM requirements. Hestressed thatthere was,nevertheless, ageneral recognition that
GATT rules applied toproducts andguaranteed market access toproducts, independent oftheir
production conditions, andhisdelegation remained oftheviewthatthiswasanessential
characteristic ofthemultilateral trading system.
88. Therepresentative ofEgypt considered that,totheextent thateco-labelling schemes
created voluntary standards ormandatory technical regulations stipulating product characteristics,
theywere subject tothedisciplines oftheTBTAgreement. More worrisome wasthefactthat
some seemed toquestion theapplicability oftheTBTAgreement toeco-labels simply toavoid any
discipline ontheiruse. Itcould notbedenied thattheAgreement wasnotdesigned witheco-
labelling schemes inmind. ThenewTBTAgreement wasinpractice completed by1990, before
thestartofformal discussions ontrade andenvironment inGATT. Discussion wastherefore far
from closed, especially ontheconsequences ofthefactthatLCA wasbased significantly on
process standards. TheCTE should continue toexplore thepossibility ofcomplementing theTBT
Agreement intheeco-labelling area. Meanwhile, governments should ensure thatthepresent
disciplines, evenifnotsufficient, were strictly observed.
89. International cooperation wasalsovitalinthedesign andimplementation ofeco-labelling
programmes toavoid discrimination andtoensure thatcriteria andthresholds were notsetina
manner todisadvantage imported "like products". Theelaboration ofsuchcriteria through
multilateral negotiations, aswellasthemutual recognition ofeco-labelling schemes ofother
countries, would beconsistent withboththespirit andobjectives oftheTBTAgreement.
Furthermore, itwould haveapositive effect notonlyontrade butalsoontheenvironment.
Without multilaterally agreed criteria andmutual recognition, theproliferation ofeco-labelling
schemes would harm theircredibility andthustheireffectiveness. Itwould alsoleadtomarket
segmentation anddiseconomies ofscale. Mutual recognition would result inanintegration of
markets andtheestablishment ofalower equilibrium price forthelabelled product. Thiswould
encourage environmentally motivated consumers toswitch from unlabelled tolabelled goods and
generate apositive income effect indeveloping countries, thusincreasing theircapability to
improve theenvironment. Hisdelegation encouraged theCommittee totakeintoaccount the
analytical work being doneinUNCTAD withregard tothose issues.
90. Therepresentative ofNewZealand noted from document WT/CTE/W/10 thatboth
voluntary andmandatory labelling standards were subject tonotification requirements intheTBT
Agreement. Thiswasparticularly pertinent toeco-labelling programmes, which were typically
voluntary standards administered partly byprivate sector ornon-government bodies butwith
important government involvement. Thedocument added auseful summary oftheobligations
under theCode ofGood Practice forstandards suchaseco-labelling programmes. Canada had
usefully described therelevance ofgovernment participation insuchschemes tothelevelof
obligations under theTBTAgreement. Even withnogovernment participation, theAgreement
imposed astrong obligation upon WTO Members withrespect tolocalgovernment andnon-
government standardising bodies. TheSecretariat history oftheTBTnegotiations noted thatthe
"reasonable measures" obligation wasexpressly aligned withGATT Article XXIV:12 language.WT/CTE/M/5
Page27
Thishadbeeninterpreted inGATT ascomparable toafirstlevelobligation, unless forexample
there were fundamental constitutional reasons preventing agovernment from ensuring compliance
withtheinternational obligation.
91. Turning tostandards suchaseco-labelling programmes based onunincorporated PPMs,
hisdelegation agreed withtheSecretariat summary thatmany participants intheUruguay Round
negotiations onTBTconsidered thatsuchstandards should notbeconsidered eligible forbeing
treated asbeing inconformity withtheTBTAgreement. Moreover, hisdelegation noted thatthe
1995 OECD Joint Expert Group report toMinisters made clear that"multilateral trade rules and
disciplines make noprovision for,andhavebeeninterpreted nottoallow for,import restrictions
based oncharacteristics which arenotphysically embodied intheimported products" (para. 56).
InthelastTBTCommittee meeting, Canada hadraised animportant point withrespect tothe
potential costs implied forindustry bynon-product related PPMs, suchasmanagement standards.
Anexamination ofthese standards could alsobeveryrelevant tocontinuing analytical work onthe
potential trade effects ofnewmeasures toachieve environmental goals.
92. Insketching possible ways toaddress thepotential trade effects ofmeasures suchaseco-
labelling, itwascommon torefertoincreased transparency andtopossible international
harmonization ofcriteria. Transparency waslikely tobehelpful, butNewZealand wasnot
convinced atthisstage thatitwasasufficient response. Hisdelegation retained astrong interest
inmutual recognition andequivalence. Harmonization hadthepotential topromote criteria which
might beinappropriate totheenvironmental circumstances ofindividual countries. Anapproach
based onmutual recognition andequivalence waslikely tolessen thisrisk,andfitted wellwiththe
preference forperformance based standards already embodied intheTBTAgreement. Itwasalso
consistent withthetrend inother areas, suchasSPSwork, towards "outcome" based approaches.
Many ofthese considerations alsoapplied topackaging andother requirements covered bythis
agenda Item, forexample theprovisions onnon-discrimination, avoidance ofunnecessary
obstacles totrade, notification andtaking comments intoaccount.
93. Therepresentative ofHong Kong welcomed thefocused discussion oneco-labelling and
supported theCanadian statement except forthesuggestion thatTBTandGATT disciplines should
extend tocover non-product-related PPMs. Anumber ofdelegations, notably India, had
underscored thecrucial concern ofextra-territorial application. Environmental arguments aside,
Hong Kong failed toseehowPPMs unrelated toaproduct 'scharacteristics could bereconciled
withthelike-product concept, which wasessential toGATT Articles IandIII.Hisdelegation
looked forward toCanada putting forward allother elements ofitsproposal.
94. Ofthematters which hadbeenraised, Hong Kong'smain concern waswhether stricter
disciplines should beapplied tonon-governmental eco-labelling schemes. Many ofthese were run
bygovernment sponsor agencies withgovernment involvement ranging from financial support to
technical assistance, andmight include approval ofassessment criteria. These schemes were
proliferating andcovered products ofsignificant interest totrade, often fordeveloping economies.
Thelackofclear rules intheTBTAgreement created problems which needed tobeaddressed.
Forinstance, theproblem thatdifferent eco-labelling programmes might existforthesame
product andbebased onwidely different criteria andprocedures fortheavailable labels. The
schemes could beabused forprotectionist purposes, especially ifandwhen influenced bylocal
industries. Thelackofinternational standards andassessment criteria hadalsomade itdifficult to
determine whether theyrepresented obstacles totrade. Hong Kong agreed withthespeakers who
hadnominated transparency tobethefirstobjective inthepresent exercise. Inthenextstep,the
CTE might beguided bytheideas ofneutral product selection, neutral assessment criteria, and
trueequity forbothdomestic andforeign suppliers.WT/CTE/M/5
Page28
95. Therepresentative ofAustralia saiddocument WT/CTE/W/10 described arange ofissues
thatdeserved careful reflection andwhich would beimportant notonlyinthedeliberations oneco-
labelling butalsoinrelation toother environmental measures included inItem3.Issues that
needed tobeaddressed inrelation toeco-labelling schemes included transparency, thedistinction
between mandatory andvoluntary schemes, howtoensure thatschemes were non-discriminatory
inrelation tobothMFN andnational treatment, problems associated withtheuseofLCA andthe
useofstandards based onPPMs andtheroleforinternational standards. There wasconsiderable
interest intheroleoftransparency inhelping toensure thateco-labelling schemes were effective
inpromoting environmental goals andsustainable development, andinaddressing concerns about
theeffects ofsuchschemes onother countries. Work wasunderway inanumber ofinternational
foraexamining transparency andother issues relevant totheoperation ofeco-labelling schemes.
Greater understanding ofthecontribution which theTBTAgreement could playinaddressing
concerns about eco-labelling schemes could helptopromote greater international cooperation on
theissues raised bythese schemes. Itwasimportant thatanyeco-labelling scheme beadequately
transparent, withfacilities forparticipation andinput byinterested parties, including foreign
producers andimporters, inthedetermination ofeco-labelling criteria. Amajor aspect ofthe
Committee 'sexamination would bethecontribution which theTBTAgreement could make to
encouraging positive interaction, including through itsprovisions inrelation totransparency.
96. Thepotential touselife-cycle analysis wasattracting attention andmight emerge asa
valuable toolforgovernments, industry andconsumers inunderstanding thecomplex
environmental effects ofproducts from "cradle tograve", andinreducing environmental burdens
caused byproducts during theirlifecycle. There were, however, atpresent some major questions
associated withtheuseoflife-cycled analysis, suchasthelackofaninternationally-agreed
methodology fortheiruse. Itwasclear from theSecretariat paper thatPPMs were thesubject of
much discussion during thenegotiations oftheTBTAgreement. There were some major issues
raised bytheuseofunincorporated PPMs ineco-labelling schemes. Forexample, those based on
environmental conditions andpriorities inanimporting country might notbeeffective andrelevant
interms ofenvironmental protection inanexporting country, andmight eveninvolve
inappropriate criteria thatforeign producers could notreasonably satisfy. Competitive
opportunities forforeign producers could beadversely affected andconsumers misled into
rejecting aproduct which might beenvironmentally equal orsuperior tothedomestic product.
97. TheCommittee could consider thecontribution which theWTO, including the
TBTAgreement, could make toefforts toensure thateco-labelling schemes were established and
operated toreduce trade frictions, besensitive totheconcerns offoreign producers, andbe
compatible withenvironmental objectives inbothimporting andexporting countries. These
included arange ofinitiatives inrelation totransparency, product coverage, andfurther work on
procedures forthemutual recognition ofeco-labelling schemes. Forexample, transparency could
befurthered bytheinvolvement offoreign producers inthedetermination ofcriteria, notification
procedures might bedeveloped which could come under theTBTAgreement or,insome cases,
theSPSAgreement, andopportunities could beprovided forgroups withasubstantive interest in
eco-labelling schemes tobeadequately represented when theschemes were established andcriteria
fornewproducts developed. Inexamining thepossible contribution oftheTBTAgreement and
other provisions ofthemultilateral trading system tointernational work oneco-labelling, theCTE
should keeptwoconsiderations inmind. First, there wasaneedtoensure eco-labelling criteria
were sensitive todiffering environmental anddevelopmental conditions indifferent countries and
thatsuchschemes didnotleadcountries tochange theirenvironmental priorities ininappropriate
ways. Second, producers andconsumers should haveconfidence thatthecriteria were soundly
based, applied fairly, served environmental protection andpromoted sustainable development.WT/CTE/M/5
Page29
98. Therepresentative ofArgentina described seven steps tobring thediscussion down toa
lesstheoretical level. First, eco-labels existed andwere being disseminated, anditwould be
difficult tohaltthis. Second, eco-labels were based onalife-cycle analysis, andthirdlife-cycle
analysis tookintoconsideration environmental externalities thattookplace throughout thelifeof
theproduct, amongst them some which were notrelated totheproduct. Fourth, non-product-
related PPMs were being legitimized through eco-labels. Thefifthstepwastorecognize that,
consequently, onewasfacing aproblem. Thesixth wastotrytorestrict it.TheCTE'sdebate
showed thatdelegations accepted thateco-labels could bevalid instruments forenvironmental
policy. However, there were doubts thattheycould alsobeefficient trade policy instruments.
Thisaspect wasofconcern tovirtually alldelegations. InArgentina 'sview, theWTO wasnot
competent todebate theutility ofanyparticular instrument ofenvironmental policy. Thiscould
bedebated inother fora, suchasUNEP andUNCTAD. Hisdelegation considered thattheWTO
should concentrate onthepromotion oftrade disciplines, making itpossible tominimize thetrade
effects ofenvironmental instruments. Eco-labels might beusedveryefficiently astrade policy
instruments and,through them, there could beadistinction between twolikeproducts onthebasis
ofthewayinwhich these products were prepared andnotonthebasis ofwhattheywere noron
thebasis ofproduct utility.
99. Oneofthemain problems identified earlier byhisdelegation wasasystemic one. The
negotiating history didnotallow foraconclusion thatnon-product related PPMs were excluded
from thedefinition oftechnical regulation. Concretely, itdidnotindicate that,during thedebate
leading uptotheapproval oftheTBTAgreement, there wasaclear distinction inthetreatment of
PPMs forstandards orfortechnical regulations. Inhisdelegation 'sview, theproblem could not
besolved byapplying theTBTdisciplines exclusively. First, theissue ofnon-product-related
PPMs should beisolated andrestricted onlytostandards, inparticular toenvironmental protection
criteria, inorder toavoid thistypeofbacteria spreading totheremainder oftheuniverse oftrade
regulations andplacing atserious riskthewhole multilateral trading system. Themain aiminthis
debate should betoidentify themechanism toisolate thesystemic risk. Furthermore, there might
betrade problems coming upastheresult oftheapplication ofspecific eco-labelling.
100. TheCTE should continue toconcentrate itswork strictly onthetrade effects. However,
noconcrete problems hadyetbeenexposed, which explained whythedebate hadbeenso
theoretical. Excessive speculation onthesubject ofeco-labelling should beavoided. Itmight be
appropriate tofocus onthemechanism seeming tohavethegreatest potential toneutralize trade
conflicts. Thismechanism wasmutual recognition ofenvironmental criteria, certification
agencies, evaluation andauditing procedures. Theproblem wascomplex andwentbeyond the
solutions thathisdelegation believed were within thereach oftheCommittee. Forthatreason,
hisdelegation considered itwould beappropriate tobegin bycircumscribing theproblem. Inthe
life-cycle analysis ofaproduct, environmental externalities were assessed. These externalities
were seenmainly inthree parts ofthelife-cycle: production, consumption anddisposal. The
externalities thatwere manifest intheconsumption anddisposal stages were linked tothe
characteristics oftheproduct. Therefore, onecould begin byaccepting mutual recognition of
environmental criteria thathadbeenestablished byeachoftheeco-labelling systems forthese two
stages, unless these criteria were discriminatory. Thiswould besubject toacase-by-case
evaluation. Furthermore, mutual recognition ofenvironmental assessment criteria and
environmental management wassubject totwostandardization processes within ISO. Mutual
recognition ofcertification agencies wasanimportant institutional aspect, butitwentbeyond the
possibilities ofthisCommittee. Trade problems would berestricted principally tothe
environmental externalities related toPPMs. Product-related PPMs could beleftaside
provisionally.WT/CTE/M/5
Page30
101. Hisdelegation considered thatinthefirstinstance theCommittee 'swork should focus on
twoelements. First, thesystemic problem, i.e.thenon-product related PPMs incorporated into
environment standards. Second, promoting themutual recognition ofenvironmental criteria
linked toPPMs thatwere notproduct-related. Onthissecond element, itmight beuseful to
explore thefollowing elements. First, theneedforenvironmental criteria tobetransparent, since
thatwastheonlywaytocompare them andreach mutual recognition based onanequivalence of
environmental criteria, thusexcluding anytrade objective which should notexistineco-labelling.
Hisdelegation hadinmind thepolicy objective behind eco-labelling, butdidnotexclude thatin
some cases thebusiness community hadatrade objective inmind. Second, theCommittee should
examine exantetransparency, tomake itpossible forinterested thirdparties, e.g.exporters that
hadamarket share, tocomment induetime. Third, theneedtoconsider thespecific
environmental andsocial circumstances ofeachproduction market. Fourth, theneedtogive
special consideration toexporters from developing countries toadapt tothecriteria intheexport
market e.g.byproviding foraphase-in period andtechnical assistance.
102. Therepresentative ofMexico saiddelegations hadflagged alackofclarity overthe
applicability andsufficiency oftheTBTAgreement andother WTO rules toeco-labelling andthe
possible needforgreater disciplines andtransparency tomitigate thetrade problem which it
created, dueprincipally tothevoluntary nature ofeco-labels andtheirimplementation bynon-
governmental standardizing bodies. Mexico considered thateco-labelling wasadequately covered
bypresent TBTdisciplines. With regard totheneedformore discipline, theCommittee hadto
continue itsanalysis ofthequestion. Theproposal ofEgypt toextend analysis inthisareaonthe
basis ofstudies already carried outbyother organizations wasinteresting. AsArgentina had
stated, theWTO didnotnecessarily havethemandate tocarry outadetailed analysis ofeco-
labelling, particularly itsenvironmental impact, whereas UNCTAD, among others, hadcarried out
studies onthesubject which could betaken intoconsideration.
103. Astotheapplicability oftheTBTdisciplines toeco-labelling, many delegations had
referred principally totransparency provisions. Itwasclear toherdelegation thatvoluntary eco-
labelling standards were subject totheprovisions oftheTBTAgreement (Article 4andAnnex 3)
regardless ofthetypeofinformation which wasprovided onthelabel. Equally, there wasno
doubt thatvoluntary labelling standards were alsosubject toother disciplines intheAgreement,
forexample, avoiding unnecessary obstacles totrade andnon-discriminatory application. The
latter obviously alsoincluded compliance withtheprinciple ofnational treatment, asunderstood
andinterpreted tomean theguarantee ofequal competitive opportunities. LiketheECandothers,
herdelegation believed thatrespect forallthese disciplines wasessential. Mere compliance with
thenotification provisions, although helpful, didnotguarantee avoiding trade distortion. Studies
carried outinother forasuggested thattheTBTprovisions ontransparency could beinsufficient
andthatgreater cooperation wasrequired. Thiswould imply theparticipation offoreign suppliers
inthedrawing upofsuchprogrammes, forexample inthephases ofproduct selection andthe
establishment ofcriteria andgoals ofenforcement. Herdelegation believed thatthequestion of
whether ornotadditional provisions were required intheareaoftransparency, andtheneedfor
more disciplines intheareaofeco-labelling, would havetobeconsidered attheappropriate time.
Forthetimebeing, itwassufficient tosaythatvoluntary standards, including those relating to
labels, were subject tonotification provisions, disciplines requiring theavoidance ofunnecessary
obstacles totrade, andtherequirement toprovide equal competitive opportunities established in
theTBTAgreement. Mexico hoped thatthiswould serve asastarting point forfuture discussion
onthequestion.
104. Another important point wasthelevelofobligation toensure thateco-labelling
programmes didabide bythese disciplines. Onthispoint, herdelegation agreed withwhathadWT/CTE/M/5
Page31
beensummed uptheSecretariat document, totheeffect thatwhether ornotastandardizing body
didaccept theCode ofGood Practice, Article 4oftheTBTAgreement required WTO Members
totakesuchreasonable measures asmaybeavailable tothem toensure thatitcomplied withthe
provisions oftheCode. Inaddition, Members must nottakemeasures which hadtheeffect of
directly orindirectly requiring orencouraging thestandardizing body toactinamanner
inconsistent withtheCode. Itwasclear thatcompliance withdisciplines overvoluntary eco-
labelling programmes wastheresponsibility ofMember governments. Paragraph 50ofthe
document made itclear thatoneofthemain areas offocus intheTokyo Round negotiations,
which wasmaintained throughout theUruguay Round, wastofindabalance between therights
andobligations between countries where thestandardizing activities largely belonged toprivate
sector institutions drawing upvoluntary standards andcountries inwhich most ofthestandards
were mandatory.
105. IntheTBTCommittee Mexico hadproposed ananalysis, inwhich thisCommittee could
alsousefully takepart,ofthedegree ofcompliance which governments hadshown sofarwith
these obligations, aswellastheextent towhich atrade imbalance wasevolving because ofthe
factthateco-labelling programmes existed insome countries andnotinothers. Herdelegation
alsobelieved thatcertain Members, providing financial participation orsupport foreco-labelling
standards, might befailing tocomply withtheobligations ofArticle 4thattheymust notdirectly
orindirectly encourage non-governmental standardizing bodies toactinamanner which was
inconsistent withtheCode ofGood Practice. Insofar astheissue ofcompliance wasexplored
further, itwould become clear whether itwasnecessary ornottoconsider newdisciplines. In
sum, itwasobvious toMexico thatthere wasaverystrong obligation upon Members toensure
compliance witheco-labelling onthebasis ofthedisciplines oftheTBTAgreement, andtheway
inwhich suchanobligation could beensured andenforced effectively hadtobeconsidered.
106. Regarding thedefinition ofstandards, which Mexico considered tobetherelevant issue
fortheCommittee andnotinanywaythedefinition ofatechnical regulation, herdelegation noted
thattheSecretariat document didnotclear upsome ofthedoubts voiced bycertain delegations as
regard toscope. Itwasclear toMexico thatthescope ofthedefinition wastheonesetoutinthe
textoftheAgreement. With regard tomutual recognition, herdelegation believed thatthepoint
made byArgentina wasuseful andwenttothecruxofthematter. Thecriteria which hadbeen
flagged byArgentina forthedefinition ofmutual recognition could befurther elaborated, andit
might beuseful fortheCommittee, together withtheTBTCommittee, tolookintothestudies and
analysis carried outbyother organizations, forexample UNCTAD, UNEP andpossibly ISO.
107. Eco-labelling wasonlyonepartofawhole body ofmeasures andrequirements (others
included packaging requirements, refilling ofdifferent containers, recycling) which were emerging
based onlife-cycle analysis ofaproduct .Theunilateral imposition onimports ofthese measures
might create newobstacles totrade. Atthesame time, there were many doubts asregards their
effectiveness andefficiency. Theanalysis ofeco-labelling might provide useful elements forthe
consideration ofother specific issues.
108. Therepresentative oftheUnited States expressed interest intheissue ofecolabelling from
boththetrade andenvironmental perspectives andwassupportive oftheobjectives ofecolabelling,
believing suchschemes could beanimportant environmental policy toolespecially inthesearch
foreffective market-friendly approaches toenvironmental protection. Atthesame time, she
recognized thepotential forcertain types ofecolabelling schemes topresent trade andmarket
access issues, depending onhowtheywere designed andimplemented. Ecolabelling wasabroad
termthatincluded multiple approaches. Onetaken intheUnited States wastheFederal Trade
Commission 'sguidelines fortheuseofenvironmental marketing claims. Sherecalled from aWT/CTE/M/5
Page32
discussion intheEMIT Group thatthese guidelines were designed toensure companies, labels and
marketing claims were notmisleading consumers. They laidoutminimum criteria foracompany 's
product tomeetifthecompany chose toclaim theproduct was"biodegradable", "recyclable",
"non-ozone depleting", etc.They thusprovided useful information toconsumers, andboththe
FTCandcompetitors hadabasis formonitoring suchclaims fortruthfulness. TheCommittee had
totakeabalanced viewofthisissue, looking notonlyatthepotential trade impact ofecolabelling
schemes butalsotherolethose programmes could playinachieving environmental goals andhow
thetrading system accommodated those objectives.
109. Herdelegation expressed caution about construing document WT/CTE/W/10 asa
definitive history ofthenegotiations, andsaidthepaper could notbecome partoftheTBT
Agreement 'snegotiating history. Such adocument wasinevitably incomplete andselective, since
many ofthediscussions intheUruguay Round wentunrecorded andsince thepaper focused on
onlyaselect number ofissues. Itneeded tobekeptinmind thatthepaper didnotattempt to
provide acomprehensive review ofallthedisciplines which were potentially relevant toa
discussion onTBT'scoverage ofecolabelling. Asregards theSecretariat 'ssummarized
"findings", shebelieved itworth emphasizing thattheTBTCommittee decisions withrespect to
coverage oflabelling were drawn from theclear language intheAgreement 'sdefinitions for
"standard 'andtechnical regulation". Sheconsidered thefinding onthecoverage ofvoluntary
standards tobemisleading. Allstandards activity wascovered byArticle 4andAnnex 3ofthe
TBTAgreement --whether developed ormaintained byacentral government, localgovernment,
ornon-governmental body; andwhether mandatory orvoluntary. Sheconsidered confused the
finding thatstandards based onPPMs related tothecharacteristics ofaproduct were accepted
under theTBTagreement, aswellashowthisrelated totheissue ofscope onwhich therestof
thepaper focused. Shewelcomed theoffer ofCanada touseitsEnvironmental Choice
ecolabelling programme asawayofmaking thediscussion ofthese issues more concrete, and
emphasized theimportance ofcontinuing tocoordinate closely withtheTBTCommittee
110. Itwasagreed thattheChairman would consult informally onthepossibility ofholding a
jointmeeting oftheCommittee andtheTBTCommittee possibly around thetimeoftheDecember
orFebruary meeting.
Item6
Theeffect ofenvironmental measures onmarket access, especially inrelation to
developing countries, inparticular totheleastdeveloped among them, andenvironmental
benefits ofremoving trade restrictions anddistortions
111. Therepresentative oftheUnited States saidthatithadbeennoted thatthereduction of
agricultural subsidies would havebeneficial environmental effects. Trade distorting policies,
including subsidies, hadadverse environmental impacts andtheirsignificant reduction or
elimination could beawin-win situation fortrade andenvironment.
112. Therepresentative ofArgentina highlighted theneedtomake progress inthediscussions
without anypreconditions being set.Along withItem1,thisItemwascentral intheCommittee 's
work andhisdelegation could notconceive ofabalanced result unless itwere included inthe
recommendations forSingapore. Thiswasnottosuggest thatwork should necessarily leadtoan
operative recommendation concerning theelimination ofspecific trade distortions, butitwould not
beconsistent todefend freetrade from thepossible distortion which resulted from certain
environmental policies ifMembers were notprepared toeliminate those environmental distortionsWT/CTE/M/5
Page33
which were linked totrade. ThisItemwasaproof ofgood intentions intheenvironmental area.
Ifconsideration were tobegiven toproposals tointroduce flexibility inWTO rules inorder to
accommodate certain environmental objectives, thentheItemwasessential.
113. Therepresentative ofAustralia supported thestatements ofthedelegations ofthe
United States andArgentina.
114. Therepresentative ofIndia recalled hisdelegation 'sdetailed statement attheSeptember
meeting onthisItem.
115. Itwasagreed thattheSecretariat would prepare astudy ontheeffect ofenvironmental
measures onmarket access.
Item7
Theissue ofexports ofdomestically prohibited goods
116. Therepresentative ofPoland saidhisgovernment hadsigned andratified themost
important MEAS which regulated DPGs. Poland recognized thepossibility ofcomplementing
those MEAs intheWTO withrespect toproduct coverage andininstances where better legal
solutions could befound. IntheCommittee 'sdiscussions onthisissue, thefactual arguments
should firstbetaken intoconsideration andtheglobal dimension oftheenvironmental problems
involved should beexplored.
117. Therepresentative ofIndia recalled hisdelegation 'sviews onDPGs andreiterated its
willingness tocontinue thedialogue onthissubject ininformal meetings.
118. TheChairman recalled thattheDecember session willbedevoted todiscussing thisissue
indepth.WT/CTE/M/5
Page34
Annex I
Committee onTrade andEnvironment
Work Programme
Theinformal consultations made evident thefollowing points:
1. Thatthestocktaking ismore aprocess-related exercise thanasubstance-related analysis
and,therefore, theresult ofthisexercise hastobeadetailed work programme toadvance the
CTE mandate, i.e.toproduce areport:
(a) identifying therelationship between trade measures andenvironmental measures in
order topromote sustainable development;
(b) making recommendations onwhether anymodifications toWTO provisions are
required, compatible withtheopen, equitable andnon-discriminatory nature ofthe
system; and
(c) complying withthemandate oftheMinisterial Decision onTrade inServices and
Environment.
2. Inorder toestablish amore focused butwellbalanced work programme, theChairman
submits thefollowing proposals:
(a) tokeepallitems onouragenda, buttomove, whenever possible, from the
discussion ofagenda items totheanalysis ofthose issues identified during the
debate asthecoreofeachitemand,tothatend,toorganize ourfuture work
programme onthebasis oftheproposal submitted below;
(b) tocontinue theprocess ofanalysis ofthese issues untilMay1996, when anew
review ofthework programme willtakeplace;
(c) thelistofissues identified nexttoeachitemisnotnecessarily exhaustive. Once
thediscussion oftheidentified issues iscarried outbytheCommittee, Members
would befreetoraiseother related issues under eachagenda itematthesame
meeting;
(d) Aspartofthework programme:
(i) jointinformal meetings oftheCTE andtheCTBT areenvisaged, subject
totheagreement oftheCTBT, toanalyze theapplicability ofthe
TBTAgreement toeco-labelling andthepossible needforfurther
disciplines foreco-labelling;
(ii) allother issues identified inthetablebelow anditems intheagenda would
bediscussed inthePlenary butinformal open-ended meetings, backto
backtothePlenary, would beconvened when adetailed analysis ofatopic
isnecessary orapaper onaspecific issue issubmitted fordiscussion;
(iii) some studies tobeprepared bytheSecretariat havebeensuggested in
addition tothose already incourse. TheSecretariat isencouraged to
continue tocooperate closely with, andtotakefulladvantage ofavailable
andforthcoming studies in,UNCTAD, UNEP andother
intergovernmental institutions.WT/CTE/M/5
Page35
Committee onTrade andEnvironment
Work Programme
Itemonthe
Work ProgrammeIssues Studies When tobe
discussed
Item one: "The relationship
between theprovisions of
themultilateral trading
system andtrade measures
forenvironmental purposes,
including those pursuant to
multilateral environmental
agreements"-ensuring the
compatibility oftrade
measures taken
pursuant toMEAs and
theWTO
-adequacy ofWTO
transparency
mechanisms
concerning trade
measures included in
relevant MEAs
-seeitem 526/27 October 95
early February 96
(7/8February 96)
26/27 October 95
early February 96
(7/8February 96)
Item three: "The
relationship between the
provisions ofthemultilateral
trading system and:
(a) charges andtaxes for
environmental
purposes-environmental taxes
which could be
adjusted attheborder
andtheir WTO-
consistency-gather information on
national environmental
taxes forthestudy26/27 October 95
early February 96
(7/8February 96)
(b) requirements for
environmental
purposes relating to
products, including
standards andtechnical
regulations, packaging,
labelling and
recycling"-applicability ofthe
TBT Agreement to
eco-labelling
-adequacy, from
boththetrade and
environmental
perspectives, ofWTO
rules regarding eco-
labelling andpossible
need forfurther
disciplines and
transparencyJoint Informal
Meetings ofthe
CTE +CTBT*
*Report totheCTE once work iscompleted.WT/CTE/M/5
Page36
Itemonthe
Work ProgrammeIssues Studies When tobe
discussed
Item three (b)cont'd -adequacy, from
boththetrade and
environmental
perspectives, ofWTO
rules regarding
packaging, handling,
andother
environmental
regulations,
requirements and
standards, including
thepossible need for
further disciplines and
transparency26/27 October 95
early February 96
(7/8February 96)
Item four: "The provisions
ofthemultilateral trading
system withrespect tothe
transparency oftrade
measures used for
environmental purposes and
environmental measures and
requirements which have
significant trade effects"-examination ofthe
proposal thatMembers
should establish
environmental enquiry
points
-seeitems 1and314/15 December
95
-item tobe
revisited in
May 96,inorder
todetermine
whether andwhere
further gaps in
transparency
existed
Item five: "The relationship
between thedispute
settlement mechanisms in
themultilateral trading
system andthose found in
multilateral environmental
agreements"-seeitem1
-environmental
expertise intrade
dispute settlement
-trade expertise in
environmental dispute
settlementearly February 96
(7/8February 95)
Item six: "The effect of
environmental measures on
market access, especially in
relation todeveloping
countries, inparticular to
theleast developed among
them, andenvironmental
benefits ofremoving trade
restrictions anddistortions"-theeffect of
environmental
measures onmarket
access
-theenvironmental
benefits ofremoving
trade restrictions and
distortions, including
tariff escalation,
subsidies, state
trading, excessively
hightariffs-theeffect of
environmental
measures onmarket
access andsetting up
ofamechanism to
survey environmental
measuresmidMarch 96
(13/14 March 96)
midMarch 96
(13/14 March 96)WT/CTE/M/5
Page37
Itemonthe
Work ProgrammeIssues Studies When tobe
discussed
Item seven: "The issue of
exports ofdomestically
prohibited goods"-DPGs, andwhether
there isaneed fora
DPG Agreement14/15 December
95
Item eight: "Trade-Related
Aspects ofIntellectual
Property Rights andthe
environment"-therelationship of
theTRIPs Agreement
toaccess toand
transfer oftechnology
andthedevelopment
ofenvironmentally-
sound technology
-therelationship
between theTRIPS
Agreement andMEAs
which contain IPR-
related obligations-analytical paper on
factors affecting
transfer of
environmentally-sound
technologyendApril 96
(17/18 April 96)
endApril 96
(17/18 April 96)
Item nine: "Services and
theenvironment"-sufficiency of
Article XIVofGATS
-possible points of
contact between
relevant MEAs and
GATSearly February 96
(7/8February 96)
early February 96
(7/8February 96)
Item two: "The relationship
between environmental
policies relevant totrade and
environmental measures
withsignificant trade effects
andtheprovisions ofthe
multilateral trading system"May 96
(21/22 May 96)
Item ten: "Appropriate
arrangements forrelations
withnon-governmental
organizations referred toin
Article VoftheWTO and
transparency of
documentation"intheCTE**
**Once adecision isadopted bytheGeneral Council.