Within the World Trade Organization (WTO), one of its “members” is somewhat of an anomaly. The European Community, a WTO member, is an economic and political integration union based on the post-World War II European Communities.[1] In 1957, through the Treaty of Rome (later renamed the Treaty Establishing the European [Economic] Community), the European Economic Community (EEC) was created by the six founding members to “lay foundations for a closer union” among Europeans through “economic and social progress” and the “elimination of barriers dividing Europe.”[2] As the focus of the Treaty was fusion of economic markets and environmental concerns were not yet in vogue, the EEC Treaty contained no mention of the environment. The Treaty did, however, include a general interest in the “quality of life” and allowed that the Treaty should not “preclude prohibitions or restrictions … justified on grounds … of the protections … of health and life of humans, animals, or plants.”[3]

Subsequently, the Single European Act, the Maastricht Treaty on European Union (TEU), and the Treaty of Amsterdam amended the Treaty Establishing the European Economic Community. [4] “Economic” was dropped from the title of the original Treaty of Rome, leaving the Treaty Establishing the European Community (EC Treaty) and signifying the expansion of the agreement to include far more than solely economic matters.[5] Likewise, the TEU was superimposed over the EC Treaty adding foreign and security policy and justice and home affairs.[6] The consolidated document is called the “Treaty on European Union together with the Treaty establishing the European Community.[7]

While many now think of the European Union as the political entity taking action on the world stage, the European Union is often acting under the authority and competence granted to it as the European Community under the amended Treaty Establishing the European Community. The European Union created by the Treaty of Amsterdam may be thought of as the governmental body in control and making decisions, but the legal authority for the European Union to act emanates from the Treaty Establishing the European Community and thus membership in international agreements is by the European Community rather than the European Union.

The principles of the Treaty Establishing the European Community now include “a high level of protection and improvement of the quality of the environment” in addition to the task of establishing a “common market and economic and monetary union.”[8] The Single European Act added Title XVI, Environment, to the EC Treaty.[9] This title established the Community’s environmental policy that includes the objectives of:

- preserving, protecting and improving the quality of the environment;

- protecting human health;

- prudent and rational utilization of natural resources;

- promoting measures at an international level to deal with regional or worldwide environmental problems.[10]

The Community policy is based on the “precautionary principle,” a belief that “preventative action should be taken,” environmental damage should be rectified at the source, and the principle that the “polluter should pay.”[11]

The European Community (EC), as a regional economic and social group is also a “member” of the World Trade Organization (WTO). In WTO parlance, the EC is a regional integration arrangement allowed to co-exist with the WTO system under Article XXIV of the General Agreement on Tariffs and Trade (GATT) that provides for the formation and maintenance of “customs unions” and “free-trade areas.”[12] Not only is each of the fifteen Union countries members of the WTO, but the European Community as a regional integration unit itself if a member of the WTO. Coincidently, the European Community regional agreement was the first such agreement notified under GATT with the Treaty of Rome in 1957.[13] The European Community is the only regional integration unit that is a member of the WTO.

The European Community, however, is more than “customs union” or “free trade area.” Formed from the post-World War II coal and steel community, the EC encompasses a great deal more than a Europe without economic borders. The Community’s reach includes minimum standards of environmental protection among member states, worker rights, gender equality, and other social goals.[14]

Like regional trade agreements, multi-lateral environmental agreements (MEA) co-exist somewhat uneasily with the WTO trading system that seems to place free trade and non-preferential treatment above all else. Agreements regarding environmental protection exist so long as their provisions do act not as barriers to trade, whether intentionally or as an unintentional result of the agreements’ implementation.[15]

This paper will explore a number of potential conflicts among these institutions. First, and possibly underlying all other issues, is the potential conflict between the position taken by the EC and that of its individual member states. The paper begins with a discussion of the interaction between the multilateral trade agreement administered by the WTO and the interaction of the regional agreements such as the treaties establishing the European Communities and Union.

Part III will consider the conflict between the European Community’s strong environmental stance and WTO rules’ impact on multi-lateral environmental agreements or environmental goals which effect trade. With regard to specific agreements, this article will explore hazardous waste regulation under the Basel Convention and other agreements that in combination with EC regulations or directives on hazardous waste trade may also be seen by the WTO as prohibited non-tariff barriers to trade.

Part IV of this paper will explore the general impact of conflict on the consensus based European Community and a specific instance of a member state acting unilaterally in advance of the Community. While the Community had only banned all asbestos use except for “white asbestos” which was only banned use in fourteen different product areas, France decided to ban all asbestos use including white asbestos. In response to the French ban, Canada filed a complaint with the WTO against the European Communities. This paper will consider this dispute both within the Community and the larger dispute within the WTO framework.

Also, the European Union recognizes the impact that lack of clarity in the integration of multi-lateral environmental agreements with the WTO system has on the goal of environmental protection. Despite the World Trade Organization’s rejection of the precautionary principle as support for environmental decision-making, the Community continues to support the vitality of the precautionary principle that seems to be in direct conflict with WTO panel rulings holding that the science must be nearly infallible before a decision is made. Part V of this Paper will explore the conflict between the European Union’s position and its publicly stated intent to influence the next WTO round with individual member nation’s goals for the next round.

II. Background on the World Trade Organization and Regional Trade Agreements

A. World Trade Organization

The World Trade Organization (WTO) is a consensus-based organization[16] formed to “provide a common institutional framework for the conduct of trade relations among its Members in matters related to the agreements and associated legal instruments.”[17] The agreements referred to in Agreement Establishing the WTO form the basis for the WTO’s multi-lateral trading system. These agreements began with the General Agreement on Tariffs and Trade of 1947 and include subsequent amendments made throughout the years and culminating in the Uruguay Round agreements.[18] The WTO agreements cover a wide range of international commerce including agriculture, textiles, clothing, banking, telecommunications, government purchases, intellectual property, and much more.[19]

The backbone of the trading system is trade without discrimination among trading partners. This principle, known as most-favored-nation (MFN), means for trade in goods, that member countries cannot apply different customs duties to members’ products.[20] Although handled slightly differently, the principle is also applicable to the General Agreement on Trade in Services (GATS) and the Agreement on Trade Related Aspects of Intellectual Property (TRIPS).[21] Likewise, members cannot discriminate between their own products and foreign products by giving domestic products “national treatment” not available to foreign products.[22]

B. Regional Agreements

Despite the fundamental importance of the “most-favored-nation” principle and the general prohibition on national treatment, World Trade Organization members are permitted to enter into regional agreements, or regional integration arrangements as they are called by the WTO, under specific conditions. Article XXIV of the GATT provides for the formation and maintenance of “customs unions” and “free-trade areas.”[23] Where customs unions are allowed under GATT, duties or other regulations of commerce applied as a result of the customs union agreement “on the whole [must not] be higher or more restrictive than the general incidence” of such duties and regulations before formation of the union.[24] Similarly, after formation of a free-trade area, duties cannot be higher or more restrictive than before the formation of the free-trade area.[25]

Also, the Enabling Clause allows for “differential and more favourable treatment” between developing country members. [26] Lastly, Article V of the GATS allows for agreements liberalizing trade in services provided that the agreement “has substantial sectoral coverage” and “provides for the absence of elimination of substantially all discrimination” between the parties through, “(i) elimination of existing discriminatory measures, and/or (ii) prohibition of new or more discriminatory measures.”[27]

Members seeking to enter into regional trade agreements are required to notify the WTO of this intention. The member countries must provide the WTO with “such information regarding the proposed union or area as will enable them to make such reports and recommendations to contracting parties as they may deem appropriate.”[28] Concerned about the potential negative impact on the multilateral trading system, The WTO General Council established the Committee on Regional Trade Agreements (CRTA) to centralize various working groups considering the impact of RTAs on the WTO.[29] The CRTA also examines the RTAs notified by member countries.

The first agreement notified under GATT Article XXIV was the Treaty of Rome establishing the European Communities. This treaty was notified Apr. 24, 1957. Although examination was concluded in 1957, the accession of Austria, Finland, and Sweden is currently under examination.[30] Fewer agreements under the Enabling Clause and GATS Article V have been notified.[31] To date, 198 regional trade agreements have been “notified” by WTO members. Of those notified, 119 are currently in force.[32]

Both the EC Treaty and the Agreement Establishing the World Trade Organization allow for the European Community to exercise the voting rights of its member states.[33] Article IX of the WTO Agreement provides for decision-making by consensus, but allows for decision by voting where consensus cannot be reached.[34] When a matter is decided by voting, each member has one vote regardless of the amount of his or her trade impacted by the proposal.[35] Where the European Communities exercise their right to vote, they have a number of votes equal to the number of European Union members.[36] As the power to enter into multi-lateral agreements derives from the EC Treaty, not the EU Treaty, when the European Union exercises its voting power within the WTO, it does so as the European Community.

C. Concern Over Regional Trade Agreements

The WTO found that during the latter stages of the Uruguay Round talks, the number of new regional trade agreements notified under GATT surged.[37] Apparently this surge was related partly to concern about the shortcomings of the GATT system and desire of many parties to have a “fall back” in an agreement did not result from the Round.[38] The traditional argument against regional agreements is that they conflict with rather than complement the WTO system since they encourage differential treatment among a small group of nations and promote isolation within the regional group. Conversely, proponents argue that regional agreements allow countries that are hesitant to open their markets to the WTO with more than 130 members to start with a smaller regional agreement. This partially opens the countries’ markets and may lead to expansion into the WTO trading system. Consideration of the effect of regional agreements on the WTO has not included the conflict, if any, with multilateral environmental agreements.

No clear quantitative answer to the question of whether regional agreements complement or compete with the WTO trading system.[39] Despite a growing body of research on the impact of regional agreements, the WTO found in 1995 that “no unambiguous answer” to the questions surrounding the effect of regional agreements.[40] Furthermore, “no conclusive evidence” has been developed to support the belief that agreement lead to increased protectionism.[41]

The uniqueness of the European Union in particular makes it very difficult to draw any conclusions from its experience that would be applicable to other more conventional customs unions or free trade areas.[42] Analysis of the early customs union between the six founding members of the European Economic Community showed that trade created exceeded trade diverted internally for manufacturing, but not for agricultural products which even today remain a contentious issue with many of the EC’s trading partners.[43]

Despite extensive efforts inside[44] and outside the WTO to establish if regional agreements complement or conflict with the WTO trading system, no consensus has developed.[45] Although the European Community has the longest history available for study of the issue, research has produced no definite answer and justifications for positive and negative positions exist. Despite great interest in the conflict between regional agreements and the WTO trading system, little consideration has been given to potential conflict between regional agreements and multilateral environmental agreements. Part III considers this issue.

III. Multilateral Environmental Agreements

As a result of the comprehensive coverage of the WTO agreements and the principles of most favored nation and prohibition of national treatment, the status of multilateral environmental agreement with trade related provisions has come under scrutiny. This paper focuses on one such agreement, the Basel Convention,[46] and the potential for conflict in the relationship between the European Community and the WTO agreements in the context of international agreements.

A. Multilateral Environmental Agreements and Trade

Multilateral environmental agreements that impact trade co-exist with the WTO trading system under general exceptions found in Article XX.[47] The GATT allows several categories of protective measures so long as the measures would not otherwise be considered an “arbitrary or unjustifiable discrimination between countries” or simply “disguised restriction[s] on international trade.”[48] Article XX(b) allows measures to “necessary to protect human, animal, or plant life or health.”[49] Similarly, Article XX(g) allows measures “relating to the conservation of exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption.”[50] To date, several GATT (pre-WTO) or WTO dispute panels have challenged domestic environmental regulations, but thus far, multilateral environmental agreements have not come under the scrutiny of a WTO dispute panel.[51]

B. Basel Convention

1. The Convention and the Ban

The Basel Convention requires informed consent for the export of hazardous waste to a party to the Convention and prohibits export to or import from a non-party.[52] Parties cannot export waste to a party that has prohibited the import of hazardous waste.[53] The Convention also requires parties to minimize the generation of hazardous waste, provide adequate disposal facilities, and practice “environmentally sound management of hazardous wastes.”[54]

The Convention rests largely upon the precautionary principle as it imposes restrictions on the transboundary movement of hazardous waste to prevent potentially serious and irreversible damage to human health and the environment.[55] The parties agreed to act in response to an unquantified “risk of damage” caused by transboundary movement of waste.[56]

The Third Meeting of Conference of the Parties (COP) agreed Decision III/1, an amendment to the Convention. [57] This amendment, often referred to as the Ban, would prohibit transboundary shipment of hazardous waste from a party to the Convention to a country not listed in Annex VII to the Convention.[58] The Annex VII list is composed of parties and states which are members of the Organisation for Economic Cooperation and Development (OECD), the European Communities, or Lichtenstein.[59] The Convention requires that three-fourths of the parties present at the time of adoption of the amendment must ratify the amendment for it to take effect.[60] To date, twenty of the required sixty-two parties have ratified the Basel Ban.[61]

2. European Union Involvement

Basel provides for political and/or economic integration units, such as the European Communities, to become parties to the Convention.[62] The Convention allows either for individual exercise of voting rights by member states or for the regional organization to vote.[63] Also, regional or political organizations are required to “declare the extent of their competence with respect to the matters governed by the Convention” to the Depositary who in turn notifies the other parties to the Convention.[64]

The EC Treaty allows the European Community (EC) to make international agreements with third parties or international organizations.[65] In order for the EC to enter into negotiations, the Commission must make recommendations to the Council, which authorizes the Commission to enter into negotiations.[66] The Commission conducts negotiation with assistance from special committees established by the Council and within the framework laid out by the Council in directives to the Commission.[67] For agreements providing reciprocal rights and obligations such as the Basel Convention, the Council must act unanimously in allowing the Commission to enter into negotiations.[68] To conclude an agreement of this nature, the Council must obtain the assent of the European Parliament, by absolute, or simple majority.[69] Currently, a simple majority in Parliament requires 314 votes. Then acting with unanimity, the Council may accept the international agreement.[70]

An interesting facet of the EC Treaty is that even though the EC is allowed under the Treaty to enter into negotiation and become a member of an international convention such as Basel, the EC’s membership does not preclude the individual member states from signing and then ratifying, accepting or approving the convention according to their national process.[71] Eight of the fifteen Union members ratified the Basel Convention through their national ratification or approval process before the European Community.[72] Five EC countries accepted the Convention on the same day as the EC and two countries, Germany and Greece, ratified the Convention after the EC.[73] The decision making process discussed above requires unanimity in the Council to approve an international agreement such as Basel.

Since the Council must act with unanimity to accept an international agreement such as the Basel Convention, all member countries must agree with acceptance of the agreement. Therefore, no conflict as to accepting the Basel Convention or any other multilateral environmental agreement like Basel is possible within the decision making process required by the EC treaty. This prevents inter-European Community conflict regarding the Convention and ensures that the fifteen members states are a strong force in favor of the principles laid down in the Convention.

In addition, the European Community adopted a regulation implementing the requirements of the Basel Convention.[74] Regulations are legally binding directly on member states.[75] Thus, in addition to the member states obligations as sovereign states accepting the Convention, the Community regulation imposes the requirements of the Convention under Community law as well. Both the European Community institutions and individual citizens have the right to bring an action against a member state from failure to act consistent with regulations and directives.[76] As member states are bound to follow the Basel Convention both by their individual acceptance of the Convention and the European Community regulation, it is unlikely that a member state will choose to take an action in conflict with the Convention.

The European Community also accepted the Basel Ban and amended the Community regulation that implemented the Basel Convention to include the Basel Ban as well.[77] The Community forged ahead with the accepting the Ban as community law despite the fact that not all Community members have accepted the Ban as individual sovereigns.[78] Again as with the implementation of the Basel Convention, the Council acted with unanimity to accept the Basel Ban, an international agreement. Therefore, although all member countries have not individually ratified the Basel Ban, all Community members must comply with the Ban under community law. Similarly, no inter-European Community conflict regarding the Basel Ban should result because of the unanimity required for the Ban.

3. Conflict

To date, no World Trade Organization disputes have arisen regarding implementation of the current Basel Convention. As the Basel Convention exists today, the notice and acceptance requirements for transboundary shipment have not yet caused an outcry from countries interested in accepting hazardous waste for disposal. One target for a trade dispute may be the relatively unbounded requirement that members of the Convention ensure wastes are “managed in an environmentally sound manner” in the importing country.[79] Lacking an internationally accepted standard (outside the Basel parties) detailing “environmentally sound management” and the subjective nature of the determination, this requirement of Basel seems most likely to create a dispute.[80] Despite basing its action on the Basel Convention, a WTO dispute panel could view a country imposing such a determination on another as attempting to apply its environmental regulations outside its borders. Previous WTO panels have not supported extraterritorial application of environmental standards that impact trade.[81]

With respect to the Basel Convention absent the Ban, the European Community has no more conflict or potential for conflict with the WTO than any country that is a member of both agreements. Again, if a European Community member, for example a less prosperous member of the Community, decided to take a conflicting action, then the member state or the corporate entity in violation of the Community regulation could be sued in the European Community Court of Justice.[82]

However, the European Community’s acceptance of the Basel Ban and subsequent inclusion of the ban into the European Community regulation could spur a challenge to the ban even before it takes affect under the Basel Convention.[83] A WTO member who is not a party to Basel[84] could challenge the ban on three grounds: violation of the principle of no quantitative restrictions, most favored nation requirement, and the national treatment principle.[85]

GATT prohibits quantitative restrictions on import or export except in the form of duties, taxes, or other charges.[86] As the ban restricts the export of hazardous waste to a non-OECD country to zero, a WTO dispute panel could find the ban to be a quantitative restriction in violation of GATT.

Likewise, GATT requires WTO members to treat all other members with “most favored nation status (MFN).”[87] By banning shipment of hazardous waste to WTO member countries that are not part of the OECD on the basis of the Ban Amendment, the European Community risks a dispute under the MFN article.[88]

Another possible ground for a dispute within the WTO framework is the uncertainty regarding the right of sovereign nations to ban import of an article of commerce that is in itself objectionable or that contains an objectionable constituent. Members banning the import of hazardous wastes can be analogized to the European Community ban on hormone injected beef or asbestos. The ban on hormone-injected beef did not survive the WTO dispute resolution process.[89] The dispute panel has yet to decide the fate of the asbestos ban.[90]

To date, no conflicts between the trade related obligations of a multilateral environmental agreement such as the Basel Convention have been considered in a formal dispute resolution process, by the WTO or otherwise.[91] All environmental conflicts resolved by the dispute resolution process of the WTO have related to the conflict between unilateral national legislation and the provisions of the GATT.[92]

C. European Community Action to Avoid Conflict

The European Union recognizes the impact that lack of clarity in the integration of multilateral environmental agreements with the WTO agreements negatively impacts the goal of environmental protection.[93] The European Union and other countries continue to propose solutions to the uncertain status of potential conflict between MEAs and the WTO Agreement.

A primary desire is for greater legal clarity of the interface and a specific WTO agreement that the particular MEA stands as ratified or amended and does not violate the GATT provisions. A WTO agreement could list the MEAs that cannot be challenged under the WTO dispute resolution system.[94] This proposal would avert a problem before an MEA is challenged, provide countries needed certainty, and possibly increase countries’ willingness to address global environmental issues with additional MEAs. Likewise, acceptance under the WTO agreement for some agreeable structure to review MEAs to make sure they do not conflict with the WTO agreement before a conflict becomes the subject of a dispute panel.[95]

IV. European Union, Member Countries, and National Legislation – The French Ban on Asbestos

Not only are each of the European Union member states members of the World Trade Organization, but the European Community as an economic entity is also a member of the World Trade Organization. In the environmental arena, not only are multi-lateral environmental agreements likely to run afoul of the WTO trade agreements, but domestic and Community regulation is liable to produce conflict with trade agreements.

The position of member countries and the European Union as a whole on an issue are not always complementary. During the WTO meetings in Seattle last year, the European Union negotiator agreed to accept the controversial United States proposal on patenting of genetically modified organisms in exchange for reciprocal concessions by the United States on agricultural subsidies.[96] The European Union member states, however, disagreed with the European Union offer because of strong public opinion against genetically modified organisms and potential lack of choice in consumer product selection.[97]

Likewise, conflict over the use and importation of asbestos products recently put a member state ahead of the European Union in acting to ban asbestos forcing the European Union to catch-up with its member country or risk not showing solidarity in the importance of environmental protection.[98]

A. Asbestos Dispute Background

Asbestos is currently the subject of a WTO Dispute Resolution Panel.[99] Despite being the wonder substance of the early fifties, asbestos exposure has been found to cause a number of long latency period injuries from its signature injury, asbestosis, to mesothelioma and lung cancer.[100] A multitude of products contained asbestos because of its unique strength, durability, and heat resistance.[101]

Although there are six types of asbestos, the most commonly known are referred to by their color, blue, brown, and white.[102] In 1991, the European Community banned the all types of asbestos except for white, or chrysotile, asbestos.[103] The European Community banned the use of white asbestos in fourteen product categories.[104] Although most white asbestos comes from relatively powerful Canada, the other types are mined predominately from southern Africa or Australia.[105] More than ninety percent of Canada’s asbestos is exported over seventy countries including the United States, the European Union, and Asia.[106] Canadian asbestos shipments for 1998 totaled 320,000 tons worth $167.2 million.[107] The Canadian asbestos mining industry employs approximately 1500 miners.[108] As a result of dropping worldwide demand for asbestos products, only three mines are active in Canada.[109]

Not surprisingly, Canadian industry had little to say[110] when the European Union banned blue and brown asbestos, but a great deal to say when France unilaterally decided to ban the “manufacture, processing, import, placing on the domestic market, possession for sale, offering, sale or transfer” of “all varieties of asbestos fibers and any product containing asbestos fibers.”[111] The French ban, unlike the previous European Union-wide ban, also included white asbestos, largely produced in Canada.[112] The EC Treaty allows member states to make more stringent environmental regulations so long as the measures are consistent with the EC Treaty and the member state notifies the Commission of the regulations.[113] Canada complained to the WTO that the French decree violated:

“(i) Articles 2, 3 and 5 of the Agreement on the Application of Sanitary and Phytosanitary Measures;

(ii) Article 2 of the Agreement on Technical Barriers to Trade;

(iii) Articles III, XI and XXIII of the General Agreement on Tariffs and Trade 1994.”[114]

Canada addressed its Request for Consultation to the European Communities rather than France specifically.[115]

B. Current Conflict

The European Community initially banned five of the six types of asbestos and fourteen specific uses of chrysotile in 1991.[116] At that time, the European Commission could not sustain a qualified majority to ban the remaining types of asbestos because of concerns by some member states about the scientific basis for such a ban.[117] Concern about the lack of suitable and conclusively less dangerous substitutes concerned some member states.[118] Accordingly, the Commission sponsored studies about the health effects of asbestos and its substitutes. These studies resulted in two opinions of the Scientific Committee on Toxicity, Ecotoxicity and the Environment that were released in 1998. The Committee reports concluded that there was “no evidence to show that there is a safe dose of chrysotile asbestos” and that the main fiber substitutes pose less of a health risk than chrysotile.[119]

Based on the new scientific studies and the national legislation banning all forms of asbestos in seven countries aside from eight other member states in addition to France, the European Commission issued a directive banning the use or import of white asbestos except for the use chlorine filters for which no substitute currently exists.[120]

C. Possible Outcome

Almost a decade ago, in the United States, the Environmental Protection Agency (EPA) also sought to “prohibit the future manufacture, importation, processing, and distribution of asbestos in almost all products.”[121] Much to the delight of the Canadian mining industry, the Court of Appeals for the Fifth Circuit, a decidedly pro-business circuit, held that the EPA had failed to establish there was not some intermediate state of regulation between the existing regulations and the almost total ban issued by the EPA under the Toxic Substances Control Act.[122]

As Canadian interests won in the Corrosion Proof Fittings case, Canada stands a reasonable chance of winning in the WTO dispute resolution process. Canada challenged the French ban on provisions of the SPS Agreement, the Agreement on Technical Barriers to Trade, and GATT.[123]

Canada complained that the ban violates Articles 2, 3 and 5 of the SPS Agreement.[124] Canada claims that the French Ban is inconsistent with the provisions of the SPS Agreement.[125] Sanitary and phytosanitary measures are only allowed if based upon scientific principles and “not maintained without sufficient scientific evidence.”[126] Canada’s will likely attack the scientific underpinnings of the French Ban and the level of certainty in the risk analysis. This determination removes the determination of an acceptable level of risk in the hands of a three-member dispute resolution panel operating behind a veil of secrecy and using scientific information as only they find necessary.

Also, Canada averred that the ban violates Article 2 of the Agreement on Technical Barriers to Trade.[127] In general, Article 2 prohibits imposition of technical regulations that treat imported products differently from domestic products.[128] Further, countries are prohibited from adopting technical regulations that create “unnecessary obstacles to international trade.”[129]

Lastly, Canada alleged that the ban violates Articles III, XI and XXIII of the GATT.[130] Article III prohibits different treatment of imported and domestic products. The French ban does not treat any asbestos different. Rather, it prohibits use of asbestos in both imported and domestic products.[131] Perhaps the most interesting question to be answered by the WTO dispute resolution panel is whether or not a ban on import of any substance is a quantitative restriction. Strictly construing the text of Article XI, no exception is found in the article for totally banning the import of any good.[132] Article XXIII notifies the European Community of Canada’s belief that benefits accruing to it under the WTO Agreement are being impaired by the Community’s action.[133]

The ban on white asbestos, despite being supported by scientific studies showing that there is no way to determine a safe level, unfortunately may result in the same result as the European Union ban on beef treated with growth hormones. [134] The Union based the beef ban on limited scientific information as well as public desire for hormone-free beef. The scientific evidence supporting the ban showed that hormone use increased various forms of cancer and reduced male fertility rates. The United States and Canada countered with risk assessments establishing a threshold level of the hormone thought to be safe.

Critics of Canada’s complaint frame the dispute as one about a country’s right to ban the use of dangerous substance where the country believes that the risk, even with controlled use, is unacceptable.[135] The dispute pits the economic interests of Canada who is desperate to save the remaining 2,000 mining jobs in the asbestos industry against WTO members’ right to determine an acceptable level of risk its citizens will be subjected to by consumer goods.[136] As reprehensible as Canada’s position regarding the European Communities may seem, its pales in comparison to Canada’s ultimate concern. While the developed world may be ready to stop using the wonder fiber, the developing world seems eager for inexpensive, durable building materials. Canada’s real concern appears to be the possible third world backlash in the wake of the European ban.[137]

V. The Precautionary Principle

The most substantial conflict between the European Union, the World Trade Organization, and the environment may not be related to a multi-lateral environmental agreement or Community legislation. Rather, the conflict may actually be with the European Community’s guiding environmental principle, the precautionary principle.[138] Although there is no standard statement of the precautionary principle, the definition by the Wingspread group[139] addresses the principle as understood commonly. The Wingspread Statement enunciates the principle as requiring that “[w]hen an activity raises threats of harm to the environment or human health, precautionary measures should be taken even if some cause and effect relationships are not fully established scientifically.”[140]

In addition to the European Community’s stated desire for “a high level of protection and improvement of the quality of the environment,” [141] the EC Treaty also requires community policy to be based on the “precautionary principle and on the principles that preventative action should be taken.”[142] This policy of basing action on the precautionary principle is itself the greatest conflict between the European Community and the World Trade Organization. The precautionary principle is in direct conflict with the requirement under the WTO agreement to implement measures to protect human health and the environment only where supported by scientific principles and “sufficient scientific evidence.”[143] The only exception to this requirement is for the provisional adoption of protective measures if scientific evidence is insufficient.[144] However, provisional measures must be followed by collection of additional information and an objective risk assessment within a reasonable period of time.[145]

A World Trade Organization Dispute Settlement Panel (DSP) and the Appellate Body considered the use of the precautionary principle in the Beef Hormone Case.[146] The dispute panel determined that the precautionary principle invoked by the Community to support its ban on the import of hormone-injected meat and meat products did not override the explicit working of Articles 5.1 and 5.2 of the SPS Agreement.[147]

Agreeing with the DSB, the Appellate Body held that regardless of the place of the precautionary principle within international environmental law, the panel could not deviate from the customary international law principles of treaty interpretation in analyzing the provisions of the SPS agreement. The panel’s interpretation of the SPS Agreement and the Community’s failure to comply could not overridden by the precautionary principle. Basically, the Community’s ban violated the express terms of the SPS Agreement making any reliance on the precautionary principle meaningless.[148] While the WTO did not make a conclusive finding on the status of the principle within the body of customary international law, the WTO did strike down the principle as justification for action under the terms of the WTO Agreement.[149]

Despite, and possibly in spite of, the outcome of the Beef Hormone Case, the European Commission adopted a Communication on the use of the precautionary principle in February 2000.[150] The Commission issued the Communication in order to provide information on how the Commission intends to apply the principle when confronted with a decision involving risk. The Commission also sought to spark debate on the issue which the subject of debate not only within the Union, but on the international front as well. The Communication emphasized that the Community, as well as other WTO members, has the sovereign right to independently establish an appropriate level of protection.[151]

The Community recognizes a structured approach to analysis of risk: risk assessment, risk management, and risk communication.[152] The principle is relevant where there is potential risk, even if the risk cannot be fully defined or quantified. To that end, the Community policy includes scientific evaluation before invocation of the precautionary principle.[153] The evaluation must be as complete as possible with evaluation of the degree of scientific uncertainty present in any conclusions.[154] The principle is invoked when the risk and level of certainty regarding that risk are unacceptable to the Community.[155] The precautionary principle is a basic tenet of the Community’s environmental policy that the Community is committed to defending internationally.[156]

As the World Trade Organization approaches the start of a new round of trade talks, the Union continues to publicly support the vitality of the precautionary principle despite the apparent conclusion that the principle is in direct conflict with the WTO dispute resolution holdings. [157] The initial decisions of the WTO dispute panels and the appellate body have not supported a sovereign state’s right to determine an acceptable level of risk to its citizens or the level of scientific certainty required to make decisions on the protection of the health of its citizens and the environment. Basically, in order to enforce environmental measures affecting trade, the supporting science must be nearly absolute before a protective measure is implemented if it will in some way affect trade. This situation is patently in conflict with the precautionary principle and its basis.

VI. Conclusion

European Union is a unique blend of a regional economic agreement and so much more – a guarantee of human rights, gender equity, and environmental protection. Despite general concern over regional trade agreements, the effect does not seem to be borne out by the data, much of which actually shows a net positive effect on trade. As to the environment, the existence of the European Union, as a regional integration unit and a signatory on multi-lateral environmental agreements, is a positive for global environmental protection. The European Union’s strong stance on the environment and amendment of the European Community Treaty to include consideration of environmental goals ensures a supportive voting block of at least fifteen members in the WTO.

The European Union will have to apply substantial pressure to get recognition of the precautionary principle in disputes over trade measures related to the environment that are clearly not protectionist and are truly the result of domestic desire to place importance on protection of human health and the environment. Reliance on the precautionary principle it seems to be a key to the Union’s fight to ensure environmental protection is compatible with the WTO’s multilateral trading system.

The European Union is not oblivious to its apparent loneliness in placing the environment on at least an even plane with trade. In a post-Seattle speech to the European Parliament, Commission Pascal Lamy admitted that the Union was “isolated in its ambitions concerning the environment.”[158] Likewise, in response to a question regarding trade and the environment, Lamy stated that “the European Union was on its own in Seattle. Regional agreements might solve regional environmental problems, but global problems require global solutions.” [159] In the Millennium Round, the European Union must have the strength to demand protection within the WTO system for both national environmental decisions and international agreem