"Restrictions on goods must be the least trade-restrictive possible and the restrictions must be 'necessary.' To prove that a regulation is 'necessary,' a country must prove that there is a worldwide scientific consensus on the danger, and a WTO tribunal of corporate lawyers must agree that the proposed regulation is a reasonable response to the danger. Furthermore, any regulation must be the 'least trade-restrictive' regulation possible. Obviously, this puts an almost insurmountable burden of proof on any government wanting to protect its citizens and its environment from harm. Thus the WTO has shifted the burden of proof back onto the public. The dead bodies must be lined up once again."
—Environmental Research Foundation, U.S.
"The WTO Technical Barriers to Trade (TBT) Agreement is an international regime to harmonize environmental and other standards, which, in effect creates a ceiling but no floor for such regulation. Under its rules, a nation must be prepared to prove, if challenged, that its environmental and safety standards are both 'necessary' and the 'least trade restrictive' way to achieve the desired conservation goal, food safety or health standard. This means that a country bears the burden of proving a negative-that no other measure consistent with the WTO is reasonably available to protect environmental and public health concerns. The WTO TBT Agreement also sets out an onerous procedural code for establishing new laws and regulations so arduous that it is very difficult for any nation to meet."
—Maude Barlow, national chairperson, Council of Canadians
"The WTO Agreement on Technical Barriers to Trade (TBT) requires that product standards—a nation's rules governing the contents and characteristics of products—be the least trade restrictive version and, with extraordinarily limited exceptions, be based on international standards."
—Lori Wallach & Michelle Sforza, Public Citizen Global Trade Watch, U.S.
This approach implicitly elevates increasing trade above any other values that national or local regulations are trying to protect or promote. Measures that impose core societal values on the economy are effectively hamstrung. An environmental regulation, for example, must use the least trade-restrictive approach to regulate disposal of toxic waste rather than a method that is more effective in protecting nearby human and ecological communities but slightly more restrictive of trade.
WTO treaties shift the burden of proof onto member countries that they could not have met the goals of any law in a less trade-restrictive way. And they impose a vague but onerous "test of necessity," forcing governments to also prove that regulations are no more restrictive than "necessary to protect human, animal or plant life or health." Where the original General Agreement on Tariffs and Trade (GATT) includes an exemption from this necessity test for measures "relating to the conservation of exhaustible natural resources," the newer General Agreement on Trade in Services drops this exception.
The Uruguay Round negotiations that created the WTO also expanded the range of environmental and public health protections that could be classified as "non-tariff barriers" to trade. Non-tariff barriers are policies that are not tariffs but that affect trade.
Exceptions to these provisions for some kinds of public-interest policies under Article XX of GATT have been upheld only once by WTO dispute-settlement rulings, in the dispute over asbestos between Canada and France.
These treaties are enforced by the World Trade Organization.
General Agreement on Tariffs and Trade 1947 (GATT 1947)
See GATT page.
Article XX - "General Exceptions"
This article has been interpreted to require that exceptions use the "least trade restrictive" and non-discriminatory methods for exempted protections.
XX(b) - Laws "necessary to protect human, animal or plant life or health."
- "Necessary" has been interpreted to require that environmental laws be the least trade restrictive way to achieve the environmental goal.
XX(g) - Laws "related to the conservation of exhaustible natural resources."
- In several cases, GATT and WTO panels ruled that Article XX(g) exceptions did not apply.
Agreement on Technical Barriers to Trade (TBT)
See TBT page.
National laws or regulations to protect the public or the environment must be both "necessary" and the "least trade restrictive" way to achieve the desired goal.
General Agreement on Trade in Services (GATS)
See GATS page.
Article 6 - Rules on domestic regulation
The rules on domestic regulation in GATS Article 6 are analogous to TBT rules on "least trade-restrictive" regulations. They require that domestic regulations "do not constitute unnecessary barriers to trade in services." Disciplines based on this section could be used to overturn national, state and local regulations even if they do not discriminate in violation of National Treatment or Most Favored Nation.
Cases & Controversies
In both the above cases, U.S. invoked article XX, but GATT ruled that the exceptions did not apply.
- Thailand, Pakistan, India, and Malaysia v. U.S. on shrimp caught without sea turtle excluder devices
See Shrimp/Sea Turtle Case page
Ruled that the U.S. Endangered Species Act was theoretically protected by Article XX, but that the law's certification requirements were not because they affected other governments, not private producers.
- Canada v. France on asbestos
See Asbestos Case page
- EEC v. U.S. on Marine Mammal Protection Act protections of dolphins
See Tuna/Dolphin Case II page
This 1994 GATT case ruled that a U.S. secondary trade embargo was not "necessary" to protect dolphins and failed the "least trade restrictive" test.
- U.S. & EU v. Japan on clean-air laws implementing Kyoto Protocol
See Greenhouse Gases Controversy page
- U.S. and Canadian efforts to limit voluntary eco-labeling
See Eco-Labeling Controversy page
The U.S. and Canadian governments have argued in the WTO that even voluntary eco-labeling (labeling products as environmentally friendly) is a technical regulation that should be scrutinized under TBT. TBT requires that product standards use the least trade-restrictive method possible and be based on international standards where applicable.
- U.S. v. Europe, Japan and Australia on labeling of genetically modified foods
See Genetically Modified Foods Controversy page
GATT 1947 & TBT
- Debi Barker & Jerry Mander. Invisible Government. The World Trade Organization: Global Government for the New Millenium? San Francisco: International Forum on Globalization, October 1999.
"The Environment," pp. 13-19.
"The Burma Case: Human Rights Affected By Finance and Investment," pp. 38-39.
- Ruth Caplan. "GATS Handbook (WTO's General Agreement on Trade in Services)." Waltham, MA: Alliance for Democracy, 2000: p. 5.
- Environmental Research Foundation. "The WTO Turns Back the Environmental Clock."
In Kevin Danaher & Roger Burbach, editors. Globalize This! The Battle against the World Trade Organization and Corporate Rule. Monroe, ME: Common Courage Press, 2000.
- Ellen Gould. "The 2001 GATS Negotiations: the Political Challenge Ahead." Waltham MA: Alliance for Democracy, 2001: pp. 2-3.
- Public Citizen Global Trade Watch. "Agreement on Technical Barriers to Trade (TBT Agreement)." Washington, DC: Public Citizen, May 1, 1999.
- Public Citizen Global Trade Watch. "WTO Talking Points: The World Trade Organization Ruling Against the Reformulated Gasoline Regulations of the U.S. Clean Air Act." Washington, DC: Public Citizen, May 16, 1998.
- Lori Wallach & Michelle Sforza. Whose Trade Organization? Corporate Globalization and the Erosion of Democracy. Washington, DC: Public Citizen, 1999.
Chapter 1: "The WTO's Environmental Impact," pp. 12-50.
Chapter 2: "The WTO, Food Safety Standards and Public Health," pp. 52-85.
- Mark Weisbrot. “Tricks of Free Trade.” Sierra Magazine. San Francisco: Sierra Club, September-October 2001.
- Frances Williams. “EU Stance on Environment Threatens New Trade Round.” London: Financial Times, October 4, 2001.
Official WTO Web site
By Peter Costantini ~ Seattle ~ November 2001