Culture, Trade, and

Environment: James Lee, American University

November 2014

Moving Trade Rules Beyond Tariffs

• 1. Post WW2 and Depression: The Growth of GATT, and the Creation of WTO (GATT, World Bank, and IMF, meeting in Havana)

• 2. Focus on Lowering Tariffs and Extending Members (23 members in 1947; goal to reduce tariffs by 50%, 6 subsequent trade rounds)

• 3. The Rise of Environmental and Cultural Non-Tariff Barriers (and Labor)

Some Trade and Environment Cases

• 1. Japan Apple Import Ban• 2. US Mexico Tuna-Dolphin Case• 3. US Ban on Immature Canadian Lobster• 4. EC Ban on Canadian Lumber for Nematodes• 5. Environmental Beer Taxes (Cans): Ontario,

Canada• 6. US Ban on Venezuelan Gasoline Imports• 7. US Sanctions on Taiwan for End. Species Trade

(*Tiger Pills)• 8. US Shrimp and Sea Turtle Protection• 9. US Ban on Japanese DriftnetsFrom James Lee, “How Much is a Dolphin Worth?”

Now Let’s Add Culture:

Definitions and Concepts

• What is culture? “The customs, arts, social institutions, and achievements of a particular nation, people, or other social group”

• What is cultural trade? GATT/WTO puts it under the category of personal, cultural, and recreational services. EU largest exporter, followed by US.

• It is regarded as a non-tariff trade barrier in trade rules.

• Cultural Exceptions to Trade: Initiated by France in 1993 in basic WTO talks

• Culture and Customs: defining health and safety in context; i.e., legitimate ban on-kosher/halal meat imports in Israel and Saudi Arabia

Culture and Trade Examples (TED Cases)• The US-Canada Country Music Feud and

Cultural Trade Protectionhttp://www1.american.edu/TED/cmtvcan.htm

• Sports Illustrated Magazine Sales in Canada and Trade Quotas on Cultural Productshttp://www1.american.edu/TED/sportsil.htm

• French TV Broadcast Quotas and Cultural Protectionhttp://www1.american.edu/TED/frenchtv.htm

Trade, Environment and Culture Cases:Culturally Appropriate or Barriers to Trade?

• EU Ban on Furs Caught in Leg Traps or Baby Seals• US Ban on Exports of Bear Parts to China• CITES Listings regarding Ivory Trade and Elephant

Decline (and the Mammoth Ivory Problem)• Hawksbill Turtle and US Sanctions on Japan (Bekko

Industry)• US Ban on Shark Finning in US Waters; Sharkfin Soup• Bats in Guam, Species Protection under CITES and

Lacey Act, and Trade

Cases are from Trade Environment Database (TED)http://www1.american.edu/ted/

Overview of Geographic Indications

• Protection of GIs date back to perhaps 1500 and French attempts to protect Burgundy wines from cheap British imitations. Wines and spirits have longest tradition.

• EU uses GI to protect. PDO (origin or process) or PGI (geographic place). Over 1,000 GIs recognized (including non EU country applications)

• US, Canada and other users trademarks (not patents). NAFTA does contain protected spirits clause covering Canadian Whiskey, Kentucky Bourbon, and Tequila, among others.

• No progress on WTO agreement in general and on GIs in particular.

How the EU Protects Food Products

• Protected Designation of Origin - PDO: covers agricultural products and foodstuffs which are produced, processed and prepared in a given geographical area using recognized know-how.

• Protected Geographical Indication - PGI: covers agricultural products and foodstuffs closely linked to the geographical area. At least one of the stages of production, processing or preparation takes place in the area.

• Traditional Speciality Guaranteed - TSG: highlights traditional character, either in the composition or means of production

From EU web site

Some GI cases

• Basmati Rice (*Texmati)http://www1.american.edu/TED/basmati.htm

• Maryland Crab (*Maryland Style)http://www1.american.edu/TED/bluecrab.htm

• Parmigiano-Reggiano Cheese”http://www1.american.edu/TED/parmesan.htm

• Darjeeling Tea: Places and Seeds Darjeeling (*)

Some PDO/TSG cases

• Ingredients: German Beer Purity http://www1.american.edu/TED/germbeer.htm

• Labeling: Mayan Sweet Onions from Peru (*)

• Pisco Liquerhttp://www1.american.edu/TED/pisco.htm

Are there Common Principles for Culture

and Environment?• 1. The Right to Survive• 2. The Right of Diversity• 3. The Least Distorting Path• 4. Pursuit of Sustainability• 5. Ownership is a Right

Concepts for Discussion

• How do we reconcile trade efficiency, cultural norms, and environmental protection? Are they equal shares?

• Is the WTO dispute settlement mechanism capable of adjudicating complicated disputes involving trade, environment and culture?