Copyright (c) 2002 The Yale Journal of International Law, Inc. The Yale Journal of International LawWinter, 200227 Yale J. Int'l L. 59LENGTH: 28658 wordsARTICLE: The Law of Environmental "PPMs" in the WTO: Debunking the Myth of IllegalityNAME: Steve Charnovitz+BIO: + Steve Charnovitz practices law at Wilmer, Cutler & Pickering in Washington, D.C. This Article is based on a lecture delivered at the Institut Universitaire de Hautes Etudes Internationales in Geneva in October 2000. Support for this research was provided by the Ford Foundation through the Global Environment & Trade Study at the Yale Center for Environmental Law and Policy, Yale University. Thanks to Rob Howse and Gabrielle Marceau for their helpful comments.SUMMARY: ... Processes and Production Methods (PPMs) are the subject of one of the most knotty controversies in the debate over "trade and environment. ... A central disagreement is whether the rules of the WTO's General Agreement on Tariffs and Trade (GATT) prohibit PPMsper se, or whether they are permitted in certain circumstances. ... These PPMs can be contrasted to an import ban that has no connection to production methods. ... While the TBTAgreement uses the term "regulation" for "mandatory" provisions, the taxonomy laid out in this Article uses the term "standard" rather than "regulation" for two reasons: first, while some environmental PPMs are regulations applied equally to foreign and domestic products, many PPMs are import bans that may not come within the scope of TBT; second, the term "regulation" has a connotation of jurisdiction to prescribe individual behavior that does not fit PPMs, which set conditions for entry or sale that the exporter may or may not seek to meet. ... Even without explicit language, however, GATT rules may still prohibit environmental PPMs. ... The U.S. import ban was a government policy standard aimed at foreign laws. ... Furthermore, the Commission administering an environmental treaty can authorize non-product-related PPMs. ... To scrutinize PPMs, the WTO will assess the validity ofthe environmental purpose underlying the trade measure. ... TEXT: [*59] I. Introduction Processes and Production Methods (PPMs) are the subject of one of the most knotty controversies in the debate over "trade and environment." n1 At [*60] issue is the appropriateness of imposing trade measures contingent on the production process. n2 Commentators often claim that the World Trade Organization (WTO) prohibits PPM-based restrictions affecting trade. n3 Such claims have convinced many environmentalists that the WTO-led trading system interferes with ecological protection. n4The reality of international trade law is different. PPMs affecting trade are not prohibited per se. Recognizing the correct legal status of PPMs is a precondition to achieving a much needed reconciliation between the World Trade Organization and environmentalists.One of the best known examples of a PPM-based restriction is the U.S. trade ban on shrimp from countries that have not been certified as having regulatory regimes in place to prevent the killing of sea turtles in the course of shrimping. n5 The U.S. government imposed a ban onshrimp imports from countries that federal officials believed were not doing enough to prevent shrimp trawlers from killing endangered sea turtles. The enforcement of the U.S. ban led to a high-profile dispute in the World Trade Organization when [*61] four countries -India, Malaysia, Pakistan, and Thailand - brought a case against the United States. n6 This famous WTO dispute is known as the "Shrimp-Turtle" case. n7Shrimp-Turtle demonstrates the cloud of suspicion surrounding the application of PPMs. This Article argues that rather than a covert tool of protectionism, a PPM can be an appropriate instrument of environmental policy. A number of international instruments already bear witness to this fact. For example, the World Charter for Nature, approved by the United Nations General Assembly in 1982, calls on governments to "establish standards for products and manufacturing processes that may have adverse effects on nature, as well as agreed methodologies for assessing these effects." n8 In fact, the WTO treaty acknowledges the importance of production methods for environmental policy. The WTO Agreement on Agriculture - in prescribing criteria for domestic support measures that remain exempt from reduction - states that payments under environmental programs must be dependent on specific conditions such as "conditions related to production methods or inputs." n9 Of course,neither the World Charter for Nature nor the Agreement on Agriculture provides an explicit endorsement of a PPM affecting trade. So long as a government applies PPMs only to domestic producers, no other government is likely to complain at the WTO. Trade conflicts are likely to arise, however, upon application of a PPM to imported products or to foreign service suppliers.With the goal of promoting the resolution of such potential trade conflicts, this Article presents a new taxonomy of PPM-based restrictions. PPMs that focus on the manner of production are preferable to PPMs that focus on the country of production. Recognizing that form matters can allow the WTO and the environmental community to communicate, thus enabling environmentalists to articulate their demands in a manner consistent with the principles of non-discriminatory trade embodied in the WTO.Several WTO agreements already recognize the validity of PPMs that clearly affect trade. n10 The Agreement on the Application of Sanitary and [*62] Phytosanitary Measures (SPS) states that governments shall allow a reasonable interval between the publication of a regulation and its entry into force in order to allow time for producers "to adapt their products and methods of production to the requirements of the importing Member." n11 The Agreement on Technical Barriers to Trade (TBT) has a similar provision. n12 The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) requires governments to establish a procedure enabling the holder of an intellectual property right to ask customs authorities to detain goods produced with a counterfeit trademark or "pirated" copyright. n13 In all of these agreements, however, the foreign production process is of concern only because of its impact on the importing country.The quarrel with PPMs is not about this kind of measure; rather, it is about the use of trade
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