1. A WTO DISPUTE From A to Z: US – Tuna Dolphin

2. The Tuna - Dolphins Case: Brief Background In the eastern tropical Pacific Ocean, schools of In the eastern tropical Pacific Ocean, schools of Yellowfin tuna often swim below herds of dolphin. Tuna fishermen were therefore using the dolphins to locate tuna, where they would then encircle both tuna and dolphins with purse seine nets to capture the tuna. This resulted in the intentional killing and injury of This resulted in the intentional killing and injury of many dolphins hence international efforts to reduce dolphin mortality, initiated and urged by USA.

3. The Measure in Issue: The US Marine Mammal Protection Act of 1972 which prohibited any person under USA jurisdiction from the taking, harassing, hunting, capturing, or killing of any marine mammal whether directly or incidentally in connection with the harvesting of fish. The Act also prohibited the importation into the United States of any marine mammal or marine mammal product and any fish or fish product harvested through the incidental killing of marine mammals.

4. Specific Aspects of the Measure in Issue: 1. The Primary Nation Embargo. (Section 101 (a) (2) and Section 305 (a) (1) and (2) of the Act.) which prohibited the importation into USA of any commercial fish or fish products harvested by a method that resulted in the incidental killing or injury of marine mammals in excess of USA standards. (Para 2.9) which prohibited the importation into USA of any commercial fish or fish products harvested by a method that resulted in the incidental killing or injury of marine mammals in excess of USA standards. (Para 2.9) These standards were deemed not exceeded if the exporting country provided evidence that it had a comparable regulatory program and rate of incidental taking. These standards were deemed not exceeded if the exporting country provided evidence that it had a comparable regulatory program and rate of incidental taking. The primary nation embargo did not also apply if a country entered into a formal agreement with USA containing certain specified commitments. (Para 2.11). The primary nation embargo did not also apply if a country entered into a formal agreement with USA containing certain specified commitments. (Para 2.11).

5. Specific Aspects of the Measure in Issue - Continued: 2. The Intermediary Nation Embargo. (Section 101 (a) (2) (C) of the Act) which prohibited the importation into USA by any country of tuna that was imported from countries that maintained tuna harvesting practices and policies that were subject to the direct ban. (Para 2.12) which prohibited the importation into USA by any country of tuna that was imported from countries that maintained tuna harvesting practices and policies that were subject to the direct ban. (Para 2.12) Such an intermediary nation was to prove that it had not imported such products within 6 months. Such an intermediary nation was to prove that it had not imported such products within 6 months.

6. The Tuna - Dolphins Case: Basic Elements PartiesComplainant EEC EEC The Netherlands The NetherlandsRespondent USA USA Third Parties Australia, Canada, Costa Rica, Japan, New Zealand, Thailand, Venezuela Australia, Canada, Costa Rica, Japan, New Zealand, Thailand, Venezuela Timeline Consultations Requested by the EEC – 11 March 1992 Requested by The Netherlands – 3 July 1992 Panel Requested by EEC: 5 June 1992 Established:14 July 1992 Composed: 25 Aug 1992 Panel notification of inability to complete work within time limit - 1 Oct 1993. Report circulated: 20 May 1994

7. The Tuna - Dolphins Case: Summary of Parties’ Claims EEC and Netherlands The Primary nation embargo and the Intermediary nation embargo were contrary to Article XI. The Primary nation embargo and the Intermediary nation embargo were contrary to Article XI. Were not border adjustments under Article III. Were not border adjustments under Article III. Were not covered by the Article XX Exceptions. (Para 3.1) Were not covered by the Article XX Exceptions. (Para 3.1) USA The Intermediary nation embargo was consistent with Article XX (g), (b) and (d). The Primary nation embargo did not nullify or impair any benefits accruing to the EEC or the Netherlands since it did not and could not apply to the EEC and Netherlands. The Primary nation embargo was consistent with Article XX (b) and (g). (Para 3.2)

8. Arguments in Support of Parties’ Claims - Article III and XI EEC and Netherlands EEC and Netherlands The embargoes though not applied to exports of tuna from their territories could be examined under GATT. (Para 3.15) The embargoes though not applied to exports of tuna from their territories could be examined under GATT. (Para 3.15) The embargoes were not justifiable as measures relating to the enforcement at the time of importation of an internal law that applied equally to the imported product and the like domestic product under the terms of the Note ad Article III. (Para 3.4) The embargoes were not justifiable as measures relating to the enforcement at the time of importation of an internal law that applied equally to the imported product and the like domestic product under the terms of the Note ad Article III. (Para 3.4) The measures constituted a quantitative restriction prohibited under Article XI:1. (Para 3.3) The measures constituted a quantitative restriction prohibited under Article XI:1. (Para 3.3) USA The primary nation embargo could not be examined under GATT because it did not affect the trade of the EEC and the Netherlands. (Para 3.16) The US said that the EC and Netherlands bore the burden of proving that the measure was inconsistent with GATT. (Para 3.6) The US measures were applied at the border and therefore should not be examined under national treatment provisions of Article III. (Para 3.6)

9. Panel Findings – Article III On determining whether the embargoes, though applied at the border should be examined under the national treatment provisions of Article III, the panel observed that a Note to Article III extends the scope of Article III to domestic measures enforced at the time or point in time of importation. (Para 5.8) The Note however was not applicable because Article III calls for a comparison of treatment between domestic and imported like products and not a comparison of policies or practices of the country of origin with those of the country of importation. The Note could only apply to the enforcement at the point of importation of those laws that were applied to the imported and domestic products considered as products. It could not apply to policies or practices that could not affect the product as such. (Para 5.8) The Note to Article III was therefore not applicable because the US measure was concerned with harvesting / importing policies and not the treatment of the product. (Para 5.9)

10. Panel Findings – Article XI: 1 “No prohibitions or restrictions other than duties, taxes or other charges, whether made effective through quotas, import or export licences or other measures, shall be instituted or maintained by any contracting party on the importation of any product of the territory of any other contracting party.” The panel found that the embargoes were inconsistent with Article XI:1 because they were “prohibitions or restrictions” in terms of Article XI, since they banned the import of tuna or tuna products from any country not meeting certain policy conditions. ( Para 5.10).

11. Arguments in Support of Parties’ Claims - Article XX (g) Arguments in Support of Parties’ Claims - Article XX (g) EEC and Netherlands EEC and Netherlands The USA measures were not primarily aimed at conservation of an exhaustible natural resource and were not taken in conjunction with domestic restrictions on production and consumption. (Paras 3.53, 3.58) The USA measures were not primarily aimed at conservation of an exhaustible natural resource and were not taken in conjunction with domestic restrictions on production and consumption. (Paras 3.53, 3.58) Article XX (g) could not be invoked for natural resources located outside the jurisdiction of the party taking the measure. (Para 3.15) Article XX (g) could not be invoked for natural resources located outside the jurisdiction of the party taking the measure. (Para 3.15) USA Both embargoes were justified under XX (g) as measures relating to conservation of dolphins, an exhaustible natural resource. (Para 3.49) There was no requirement that such resources had to be in the domestic jurisdiction of the country imposing the measure. (Para 3.16) Measures met the requirement of the preamble to Article XX. (Para 3.7)

12. Panel Findings – Article XX (g) 1. The embargoes were not justified by Article XX (g). (Para 5.11). 2. Article XX (g) suggests a 3 step analysis. (Para 5.12) Policy should fall within the range of policies to conserve exhaustible natural resources. The policy to conserve dolphins was one to conserve an exhaustible natural resource. (Para 5.13). Policy should fall within the range of policies to conserve exhaustible natural resources. The policy to conserve dolphins was one to conserve an exhaustible natural resource. (Para 5.13). Measure should be “related to” the conservation of an exhaustible natural resource and should be made effective “in conjunction” with restrictions on domestic production or consumption. The embargoes were aimed at changing other countries’ policies so as to effect the conservation. The embargoes could not by themselves further USA conservation objectives – were not primarily related to conservation, but to changing policies that would lead to conservation. (Para 5.23) Measure should be “related to” the conservation of an exhaustible natural resource and should be made effective “in conjunction” with restrictions on domestic production or consumption. The embargoes were aimed at changing other countries’ policies so as to effect the conservation. The embargoes could not by themselves further USA conservation objectives – were not primarily related to conservation, but to changing policies that would lead to conservation. (Para 5.23)

13. Panel Findings – Article XX (g) Continued Measure must be applied in conformity with the preamble to Article XX – that is, not in a manner that constitutes a means of arbitrary or unjustifiable discrimination. Since an essential condition of Article XX (g) had not been met, this requirement was not inquired into. (Para 5.27) Measure must be applied in conformity with the preamble to Article XX – that is, not in a manner that constitutes a means of arbitrary or unjustifiable discrimination. Since an essential condition of Article XX (g) had not been met, this requirement was not inquired into. (Para 5.27) 3.There is no limitation on the location of the exhaustible natural resource to be conserved. It can be outside the conserving country’s jurisdiction.

14. Arguments in Support of Parties’ Claims - Article XX (b) Arguments in Support of Parties’ Claims - Article XX (b) EEC and Netherlands EEC and Netherlands The animals whose life and health was to be protected had to be within the jurisdiction of country taking measure. (Para 5.28) The animals whose life and health was to be protected had to be within the jurisdiction of country taking measure. (Para 5.28) The intermediary nation embargo did not meet the “necessary” test as required under Article XX (b) because USA had not demonstrated that it had exhausted all reasonable measures available to it to pursue its dolphin conservation policy in international waters through means compatible with GATT. (Para 3.75) The intermediary nation embargo did not meet the “necessary” test as required under Article XX (b) because USA had not demonstrated that it had exhausted all reasonable measures available to it to pursue its dolphin conservation policy in international waters through means compatible with GATT. (Para 3.75) USA measures were not within meaning of Article XX (b). (Para 3.71) USA measures were not within meaning of Article XX (b). (Para 3.71) USA The embargoes were “necessary” to protect the life and health of dolphins. (Para 3.64) USA interpreted “necessary” to mean the measure was “needed” to protect such life or health. USA argued that it had exhausted all other options before taking the measures in issue. (Para 3.69) There is no requirement that such animals have to be within jurisdiction of conserving country. (Para 5.28) Measures met requirement to Article XX. (Para 3.60)

15. Panel Findings – Article XX (b) 1. The embargoes were not justifiable under Article XX (b). 2. The text of Article XX (b) suggests a 3 step analysis: (Para 5.29) The measure should be to protect human, animal or plant life or health. The USA measure fell within this requirement. The measure should be to protect human, animal or plant life or health. The USA measure fell within this requirement. The measure is “necessary” to protect human, animal or plant life or health. The term “necessary” meant that no alternative existed. The USA measure was taken so as to force other countries to change their policies and could only be effective only if such changes occurred. Could not be considered necessary for the protection of animal life or health. (Para 5.39) The measure is “necessary” to protect human, animal or plant life or health. The term “necessary” meant that no alternative existed. The USA measure was taken so as to force other countries to change their policies and could only be effective only if such changes occurred. Could not be considered necessary for the protection of animal life or health. (Para 5.39) The measure was applied in a manner consistent with the preamble to Article XX, namely, it not be applied in a manner that constitutes a means of arbitrary or unjustifiable discrimination. Since an essential condition of Article XX (g) had not been met, this requirement was not inquired into. The measure was applied in a manner consistent with the preamble to Article XX, namely, it not be applied in a manner that constitutes a means of arbitrary or unjustifiable discrimination. Since an essential condition of Article XX (g) had not been met, this requirement was not inquired into.

16. Arguments in Support of Parties’ Claims - Article XX (d) EEC and Netherlands EEC and Netherlands The primary nation embargo was inconsistent with GATT, thus could not serve as the basis for an invocation of Article XX (d). (Para 3.80) USA The intermediary nation embargo was necessary to secure compliance with the primary nation embargo. (Para 3.78)

17. Panel Findings – Article XX (d) The panel found that the measures taken under the primary embargo were inconsistent with Article IX:1 GATT. As such, the primary nation embargo could not serve as a basis for justification of the intermediary nation embargo. (Para 5.41)

18. CONCLUSIONS 1. Environmental Aspect The panel noted that the question in issue was not the validity of the environmental objectives pursued by USA but whether in pursuit of its environmental objectives, USA could impose trade embargoes to secure changes in the policies pursued by other contracting parties pursued in their jurisdictions. (Para 5.42) The panel noted that the question in issue was not the validity of the environmental objectives pursued by USA but whether in pursuit of its environmental objectives, USA could impose trade embargoes to secure changes in the policies pursued by other contracting parties pursued in their jurisdictions. (Para 5.42) The panel therefore had to resolve whether the Contracting Parties by agreeing to give each other in Article XX the right to take trade measures necessary to protect the health and life of plants, animals and persons or aimed at the conservation of exhaustible natural resources, had agreed to accord each other the right to impose trade embargoes for such purposes. The panel therefore had to resolve whether the Contracting Parties by agreeing to give each other in Article XX the right to take trade measures necessary to protect the health and life of plants, animals and persons or aimed at the conservation of exhaustible natural resources, had agreed to accord each other the right to impose trade embargoes for such purposes. The Panel examined this issue in light of the recognized methods of interpretation and found that none of them lent support to the view that such an argument was reflected in Article XX. The Panel examined this issue in light of the recognized methods of interpretation and found that none of them lent support to the view that such an argument was reflected in Article XX.

19. Conclusions Continued 2.General Conclusion The primary nation embargo and the intermediary nation embargo did not meet the requirements of the Note ad Article III, were contrary to Article XI:1, and were not covered by the exceptions in Article XX (b), (g) or (d) of GATT. (Para 6.1)