Sustainability & Environmental Sustainability & Environmental Impact Assessment of Trade Impact Assessment of Trade

Negotiations: Negotiations: Doha and BeyondDoha and Beyond

WTO Public Forum 2006 WTO Public Forum 2006 ““What WTO for the XXIst Century?”What WTO for the XXIst Century?”

25-25 September 2006 WTO Building, Geneva, Switzerland

Sustainability & Environmental Sustainability & Environmental Impact Assessment of Trade Impact Assessment of Trade Negotiations: Negotiations: Doha and BeyondDoha and Beyond

WTO Public Forum 2006 “What WTO for the XXIst WTO Public Forum 2006 “What WTO for the XXIst Century?”Century?”

25-25 September 2006 - WTO Building, Geneva, Switzerland

ChairChair:: Prof. MProf. Marie-Claire Cordonier Segger, arie-Claire Cordonier Segger, Director, Centre for Int’l Sustainable Development Law Director, Centre for Int’l Sustainable Development Law

(CISDL)(CISDL)

Keynote:Keynote: Rupert Schlegelmilch, Rupert Schlegelmilch, Head, European Head, European Commission DG Commission DG Trade F3 (Sustainable Trade F3 (Sustainable Development)Development)

Panellists:Panellists: * * Prof. Clive George, Prof. Clive George, Institute for Development Institute for Development Policy and Policy and Management, University of Management, University of ManchesterManchester

* * Michelle Cooper, Michelle Cooper, First SecretarFirst Secretaryy, Permanent Mission , Permanent Mission of of Canada to the Canada to the UN and the WTOUN and the WTO

* * Darlan Fonseca MartíDarlan Fonseca Martí, , Counsel, Trade Law, South Counsel, Trade Law, South CentreCentre

* * Dr. Markus W. Gehring, Dr. Markus W. Gehring, Lead Counsel, TradeLead Counsel, Trade Investment & Investment & Competition Law, CISDL & Competition Law, CISDL & Lecturer in International Law, Lecturer in International Law, University of University of Cambridge Cambridge

** Prof. Prof. Gabrielle MarceauGabrielle Marceau,, Conseiller, Cabinet du Conseiller, Cabinet du Directeur Directeur général, WTO Secrétariat général, WTO Secrétariat & & University of GenevaUniversity of Geneva

CISDL?CISDL?

• Legal Research Centre: Collaborative relationships with McGill Law Faculty and Cambridge Faculty of Law.

• Mission: To promote sustainable societies and the protection of ecosystems by advancing the understanding, development and implementation of international sustainable development law.

• R-SIA Project: A team of developed and developing country legal scholars researching regulatory aspects of impact assessments of regional and global trade negotiations, creating:- legal briefs / web resources,- legal research papers, and- a proposed ‘best practice’ methodology / instrument for regulatory assessment in IAs .

www.cisdl.org

Centre for International

Sustainable Development

Law:

Legal Challenges and Proposals for Impact Legal Challenges and Proposals for Impact Assessment of Trade Agreements in the Assessment of Trade Agreements in the

XXIst CenturyXXIst Century

Dr. Markus W. Gehring, LL.M. (Yale)Dr. Markus W. Gehring, LL.M. (Yale)Centre for International Sustainable Centre for International Sustainable

Development LawDevelopment LawMontreal, Canada / Cambridge, United Montreal, Canada / Cambridge, United

KingdomKingdomwww.cisdl.orgwww.cisdl.org

25-25 September 2006WTO Building, Geneva, Switzerland

Sustainability and Environmental Impact Assessment of Trade Negotiations: Doha

and Beyond

OutlineOutline

Part 1: Part 1: Stocktaking of Stocktaking of EExisting National xisting National Rules oRules on Impact n Impact AssessmentAssessment of of TTrade rade AAgreementsgreements

1 a: 1 a: CCanada’sanada’s Environmental A Environmental Assessmentssessments s 1 b: 1 b: US’ Environmental ReviewsUS’ Environmental Reviews 1 c: EU’s Sustainability Impact Assessments1 c: EU’s Sustainability Impact Assessments

Part 2: Proposals for the XXIst CentPart 2: Proposals for the XXIst CenturyuryProposal 1 Proposal 1 – – Regulatory Elements of Regulatory Elements of IAsIAsProposal 2 – A ‘Low Impact’ Model for IAsProposal 3 – Developing a Multilateral Dimension?

Part Part 33: Elements of : Elements of aa WWay ay FForwardorward

Part 1: Stocktaking of Part 1: Stocktaking of EExisting National Rules xisting National Rules oon Impact Assessmentn Impact Assessment of of TTrade rade AAgreementsgreements

1a) Canada’s Environmental Assessment of Trade Policies

How to Assess Regulatory Impacts?How to Assess Regulatory Impacts?Regulatory effects refer to the likely legal and/or policy effects of Regulatory effects refer to the likely legal and/or policy effects of agreements. agreements. (p 4.12)(p 4.12)

Stage 1 Initial EA Regulatory EffectsStage 1 Initial EA Regulatory Effects: Would domestic economic policy : Would domestic economic policy changes be required as a result of the agreement? If so, what sort of changes be required as a result of the agreement? If so, what sort of changes required? changes required? (p 4.13)(p 4.13) Stage 2 Identification of Impacts / Regulatory EffectsStage 2 Identification of Impacts / Regulatory Effects: How is the : How is the economic change related to any current environmental regulations, economic change related to any current environmental regulations, standards, or voluntary initiatives? Are there current international standards, or voluntary initiatives? Are there current international environmental agreements or negotiations related to the sector(s)? environmental agreements or negotiations related to the sector(s)? (p 4.15)(p 4.15) Draft EA Regulatory EffectsDraft EA Regulatory Effects: How is the economic change related to any : How is the economic change related to any current environmental regulations, standards, or voluntary initiatives? Are current environmental regulations, standards, or voluntary initiatives? Are there current international environmental agreements or negotiations there current international environmental agreements or negotiations related to the sector(s) to which Canada is a party? Are there issues of related to the sector(s) to which Canada is a party? Are there issues of public concern regarding government policy in the sector? public concern regarding government policy in the sector? (p 4.31)(p 4.31)

Canadian Handbook for Conducting Environmental Assessments of Trade Negotiations (Oct. 2004)

1: Stocktaking of Existing National Rules 1: Stocktaking of Existing National Rules on Assessmentson Assessments

1a) Canada’s Environmental Assessments

What What are the Limits of Canadianare the Limits of Canadian AssessmentAssessment??

Analyses only effects on domestic (ie: Canadian) laws, and international regulatory impacts as these affect the Canadian ability to meet treaty obligations, or specific project application in foreign countries; Analyses only environmental impacts; Analyses only potential impact on ability to meet international and national legal obligations, so does not address impact on use of rights, nor constraints/enhancements of implementing measures.

1: Stocktaking of Existing National Rules on 1: Stocktaking of Existing National Rules on AssessmentsAssessments

1b) United States’ Environmental Reviews

How to Assess Regulatory Impacts?How to Assess Regulatory Impacts?

“ “b. Solicitation of Information: (1) The scoping process shall draw upon the b. Solicitation of Information: (1) The scoping process shall draw upon the knowledge of any agency with relevant expertise in the subject matter under knowledge of any agency with relevant expertise in the subject matter under consideration, as well as the views of Congress, the public, and advisory consideration, as well as the views of Congress, the public, and advisory committees. (2) Where matters affecting state, local and tribal government committees. (2) Where matters affecting state, local and tribal government regulatory authorityregulatory authority may be at issue, USTR shall consult with the may be at issue, USTR shall consult with the Intergovernmental Policy Advisory Committee (IGPAC) and other appropriate Intergovernmental Policy Advisory Committee (IGPAC) and other appropriate sources of information.”sources of information.” “ “2. Examples of possible regulatory implications include impacts on the ability 2. Examples of possible regulatory implications include impacts on the ability to maintain, strengthen and enforce laws, regulations and policies on pollution to maintain, strengthen and enforce laws, regulations and policies on pollution control; control of toxic and hazardous wastes and materials; protection of control; control of toxic and hazardous wastes and materials; protection of natural resources, wildlife and endangered species; relevant product standards; natural resources, wildlife and endangered species; relevant product standards; control and regulation of pesticides; food safety; and the public’s ability to obtain control and regulation of pesticides; food safety; and the public’s ability to obtain information regarding the environment.”information regarding the environment.” “ “I. Regulatory Effects: A. Potential positive and negative implications of the I. Regulatory Effects: A. Potential positive and negative implications of the proposed trade agreement for U.S. environmental regulations, statutes, and proposed trade agreement for U.S. environmental regulations, statutes, and binding obligations such as multilateral environmental agreements, as well as binding obligations such as multilateral environmental agreements, as well as potential implications for the ability of state, local and tribal authorities to potential implications for the ability of state, local and tribal authorities to regulate with respect to environmental matters. B. Potential positive and negative regulate with respect to environmental matters. B. Potential positive and negative implications of the proposed trade agreement for environmental policy implications of the proposed trade agreement for environmental policy instruments and other environmental commitments.”instruments and other environmental commitments.”

Guidelines for Implementation of  Executive Order 13141: Environmental Review of Trade Guidelines for Implementation of  Executive Order 13141: Environmental Review of Trade AgreementsAgreements

1: Stocktaking of Existing National Rules on 1: Stocktaking of Existing National Rules on AssessmentsAssessments

1b) United States’ Environmental Reviews

What What are the Limits of USare the Limits of US AssessmentAssessment?? Analyses only environmental impacts; Analyses impacts for both the US and trading partners, and international regulatory impacts as these affect the US ability to meet treaty obligations, but assessment is done for trading partners rather than locally owned. Analyses only potential impact on ability to meet international and national legal obligations, so does not address impact on use of rights, nor constraints/enhancements of implementing measures (eg: eg: ERs of Jordan-US FTA, Chile-US FTA, US-CAFTA FTA ERs of Jordan-US FTA, Chile-US FTA, US-CAFTA FTA found found certaincertain reduction of reduction of regulatory space but also role regulatory space but also role for enviro chapter to strengthen laws in partner countriesfor enviro chapter to strengthen laws in partner countries).).

1:1: Stocktaking of Existing National Rules on Stocktaking of Existing National Rules on AssessmentsAssessments1c) What are the Limits of European Union SIAs?

Analyses environment + social + development aspects = SD Analyses environment + social + development aspects = SD approach;approach;

Analyses impacts for EU and trading partners = very global Analyses impacts for EU and trading partners = very global application (but not systematic, eg: SIA for EU/Arab Gulf application (but not systematic, eg: SIA for EU/Arab Gulf countries); countries);

Engages partner organisations, many of whom have capacity Engages partner organisations, many of whom have capacity to analyse relevant laws;to analyse relevant laws;

‘‘Handbook Handbook for Trade Sustainability Impact Assessment’ appears open to elements of regulatory assessment; elements of regulatory assessment;

Regulatory assessments could be a useful additional tool in Regulatory assessments could be a useful additional tool in current SIA toolkits, as there is potential to extend from current SIA toolkits, as there is potential to extend from analysis of analysis of impacts on domestic and treaty obligations, to also take into account impacts on domestic and treaty rights , and potential constraints on measures to implement SD laws.

Part 2: Proposals for the XXIst Century

Proposal 1 - Regulatory Regulatory Elements of IAsElements of IAs

Objective:

Regulatory elements of impact assessments have potential to enable negotiators to identify potential intersections between new trade obligations and other international, regional and domestic treaties / laws.

In addition:

Regulatory assessments can go beyond allowing negotiators to deal with intersections, identifying areas where a trade treaty could promote SD through active support for other SD treaty instruments and laws.

Proposal 1 - Regulatory Regulatory Elements of IAsElements of IAs

2a) Domestic challenges implementing national SD policies and laws related to trade Many countries are facing serious challenges in enacting effective domestic laws to implement international/regional SD and trade obligations Many ministries/jurisdictions are involved, interests can overlap and even collide Need to effectively address complex issues with very few resources

Case Study: Implementing Cartagena Biosafety Protocol in Africa Concerns have been raised by national officials in domestic biosafety law-making processes, and in trade law-making processes, as to synergies / overlaps of obligations / rights / implementing measures. There is a need for reliable ex ante analysis to inform the domestic implementation of international/regional agreements to avoid potential conflicts and enhance the positive synergies that might occur.

Proposal 1 - Regulatory Regulatory Elements of IAsElements of IAs

2b) International challenges negotiating multilateral treaties related to trade and sustainable development

MMany countries any countries faceface challe challennges in effectively negotiating ges in effectively negotiating a a complex array of overlapping international and regional treaties,complex array of overlapping international and regional treaties, Many countries seek greater coherence in international Many countries seek greater coherence in international obligations,obligations, Need for mechanisms to coordinate between different officials Need for mechanisms to coordinate between different officials with distinct subject-matter jurisdictions, with distinct subject-matter jurisdictions, Need for greater capacity, also analytical and informational Need for greater capacity, also analytical and informational resources.resources.

Case Study: Intersections in post-Kyoto Protocol negotiations and market access provisions of WTO Agreements & TBT Debates in the UNFCCC COP/KP MOP: Use of economic instruments post-2012 Debates in WTO and other regional/bi-lateral FTAs regarding discrimination based on PPMs, standards, etc, for non-parties to MEAs Need for ex ante information during the negotiation of international/regional agreements to avoid potential conflicts and enhance the positive synergies that might occur.

Proposal 1 - Regulatory Regulatory Elements of IAsElements of IAs

Include Regulatory Elements in Impact Include Regulatory Elements in Impact AssessmentsAssessments

Increasing technical and legal complexity of trade and Increasing technical and legal complexity of trade and other SD law requires other SD law requires additional information and analysisadditional information and analysis for more effective trade negotiationsfor more effective trade negotiations

Where present proliferation of international Where present proliferation of international commitments leads to intersections of rules addressing the commitments leads to intersections of rules addressing the same subject matter, assessment can help to ensure same subject matter, assessment can help to ensure greater greater coherencecoherence in trade and other SD policies. in trade and other SD policies.

Trade policies and laws that foster rather than frustrating Trade policies and laws that foster rather than frustrating sustainable development objectives are more likely to sustainable development objectives are more likely to last.last.

CISDL’s R-SIA Research Agenda

Potential rules for regulatory aspects of IAs

1) During negotiations: identify and analyse all existing national, regional, and international regulation that can have intersections with the trade negotiation;

2) Consider potential obligations deriving from trade agreements and analyse potential effects for obligations, rights, and implementing measures of other SD treaties and domestic laws;

3) Propose enhancement and mitigating options to adjust/control these effects.

Potential outcomes?

1) Avoid or resolve conflicts or overlaps between economic, social and environmental law and policy before they arise;

2) Support and promote SD objectives of national, regional and international trade law.

Proposal 2 – A ‘Low Impact’ IA

Challenge: - In many countries, resources are very limited- Basic data, knowledge and capacity are lacking - For these policy makers, IAs may appears to be a ‘luxury project’…

How to conduct streamlined ex-ante / ongoing / ex-post IAs of trade agreements, taking into account existing gaps in:- information (including basic economic, social & enviro data)- awareness and participation- capacity and analysis- human and financial resources

Basically, if we have a Mercedes, a Cadillac and a Ford model of Impact Assessments… what would be the ‘Volkswagen Beetle’ model (or should we say – the ‘Smart Car’)?

Proposal 2 – A ‘Low Impact’ Model for IAsKey Principles for a ‘Low Impact’ IA: Streamlined, based on existing data Specifically relevant to agreed SD interests Country-driven, focused on essential priorities & concerns Not just simpler, smarter.

Potential Elements of New Rules for ‘Low Impact’ IA Timing (before last round of negotiations in each area?) Scope of IA (focused on key laws & sectors of most interest to the

country?) Models of Economic Effects of Trade (based on existing data?) Scoping / Assessment of Impacts (only two phases?) Identification of Environment, Social Development and Economic

Indicators / Impacts (selected variables/indicators only, using multilateral sources?)

Intra-governmental, Public and Private Participation (stakeholder-friendly outreach materials, capacity-building elements, rules for intervenor funding?)

Mitigation and Enhancement Measures (identify low-cost options, capacity-building opportunities for negotiators, sources of financing / cooperation?)

CISDL’s R-SIA Research Agenda

What rules could be useful for a ‘low-impact’ IA process?

1) What are the key challenges for countries and governments that wish to conduct IAs and cannot, and how could these challenges be overcome?

2) What are the principles and options for ‘low-impact’ IAs?

3) What new rules and tools are needed to put such processes into place?

Outcomes?

1) Facilitate the use of IA processes by all WTO members.

2) Support and promote SD objectives of national, regional and international trade law and policy.

Proposal 3 – Developing a Multilateral Dimension?

3a) Integration of IAs into future WTO 3a) Integration of IAs into future WTO negotiations?negotiations?

Not prevented but not yet required by WTO rules… Processes are easier to install than hard standards… Concrete steps are possible in WTO negotiations:

- DDA Para. 51 type provisions could become standard in all trade negotiation mandates.- Co-operation with UNEP, UNCTAD & UNDP could be deepened.- CTE and CTD could seek common methodologies.- Ongoing & further IAs could be facilitated in WTO negotiations through increased sharing of results among members.- Sharing of results & cooperative IA ventures among members could further strengthen internal /external WTO transparency & participation.

Proposal 3 – Developing a Multilateral Dimension?

3b) Coordination, Information Sharing & Support 3b) Coordination, Information Sharing & Support for Impact Assessment through the WTO?for Impact Assessment through the WTO?

Allow IA and SD information sharing in TPRM, and develop appropriate mechanisms for public participation in TPRM.

Increase information sharing with regards to IAs and circulate results among membership.

Facilitate coordination of Regional Agreement IAs and consider facilitating bi-lateral IAs between WTO members.

Consider co-ordination of financing mechanisms for IA, such as funds or IA technical support.

Proposal 3 – Developing a Multilateral Dimension?

Case Study: The GATS Assessment Commitment to conduct assessments of trade in services Commitment to conduct assessments of trade in services

“For the purposes of establishing [negotiating] “For the purposes of establishing [negotiating] guidelines, the Council for Trade in Services shall carry guidelines, the Council for Trade in Services shall carry out an assessment of trade in services in overall terms out an assessment of trade in services in overall terms and on a sectoral basis with reference to the objectives of and on a sectoral basis with reference to the objectives of this Agreement, including [increased developing country this Agreement, including [increased developing country participation]” participation]” Art. XIX:3 GATSArt. XIX:3 GATS

2000 Special Session of the Services Council (and 2002 2000 Special Session of the Services Council (and 2002 Symposium)Symposium)

Members decided on an ongoing exercise and received Members decided on an ongoing exercise and received various contributions including from Thailand, South various contributions including from Thailand, South Africa, China and the USAAfrica, China and the USA

Specific development focus (see also UNCTAD and Specific development focus (see also UNCTAD and International Trade Centre studies)International Trade Centre studies)

No public participation / no single methodologyNo public participation / no single methodology

Part 4: Elements of Elements of aa WWay ay FForwardorward

• Convert existing EA mechanisms into sustainable development IAs.• Strengthen regulatory elements of IAs.• Develop and test ‘low impact’ models for IAs • Multilaterlise parts of IAs.

The CISDL’s ongoing R-SIA research is investigating… - Case studies of existing IAs, with emphasis on regulatory elements & basics - Studies on how IAs actually affect national / international negotiations & laws - Potential instruments for assessment of regulatory aspects of IAs.- Potential ‘low impact’ models of IA for low data / resource countries- Potential for cooperation between countries at the regional and multilateral levels.

IA instruments could provide an additional tool for trade negotiations, and could help to increase coherence in the creation and application of international, regional and domestic laws for sustainable development (including trade agreements).

THANK YOUMarkus Gehring (mgehring@cisdl.org)Centre for International Sustainable

Development Law

Special thanks to Prof. Marie-Claire Cordonier Segger and Ms. Christine Frison

Centre for International Sustainable Development Lawwww.cisdl.org