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Trade and Environment

Overview

The 1994 Marrakesh Agreement establishing the WTO refers to the importance of sustainable development and WTO Members explicitly agreed on a Decision on Trade and Environment. WTO Members established a Committee on Trade and Environment (CTE) at the first meeting of the WTO General Council after the entry into force of the WTO. The CTEs standing agenda provides opportunities for WTO members to raise a wide range of issues relating to trade and environment. The CTE has met regularly since 1995.  The WTO Secretariat prepared a background document in April 2004 to assist public understanding of the Trade and Environment debate in the WTO (pdf).

A number of issues relating to the interaction between WTO rules and environmental objectives has been considered in disputes in the WTO. A particularly prominent environment-related dispute was over the use of turtle excluder devices between the United States on one hand, and Malaysia, Thailand, India and Pakistan on the other - see DS58. Australia was a third party in this dispute.

At Doha in November 2001, WTO Members agreed to specific but limited negotiations on particular trade and environment issues. With a view to enhancing the mutual supportiveness of trade and environment, trade ministers agreed to negotiations on:

  1. the relationship between existing WTO rules and specific trade obligations set out in multilateral environmental agreements (MEAs);
  2. procedures for regular information exchange between MEA Secretariats and the relevant WTO committees, and the criteria for the granting of observer status;
  3. the reduction or elimination of tariff and non-tariff barriers to environmental goods and services.

It was agreed that this ‘Doha Mandate’ would be negotiated by the CTE in Special Session (CTESS).  In addition, the Committee on Trade and Environment was instructed in pursuing work on all items on its agenda within its current terms of reference, to give particular attention to:

  1. the effect of environmental measures on market access, especially in relation to developing countries, in particular the least-developed among them, and those situations in which the elimination or reduction of trade restrictions and distortions would benefit trade, the environment and development;
  2. the relevant provisions of the Agreement on Trade-Related Aspects of Intellectual Property Rights; and
  3. labelling requirements for environmental purposes.

WTO Members emphasised that the negotiations, except for the negotiations on the elimination of tariff and non-tariff barriers to environmental goods and services, and the ongoing work of the CTE would not add to or diminish the rights and obligations of Members under existing WTO agreements, or alter the balance between such rights and obligations.

Other relevant references to trade and environment issues can be found in paragraphs 6, 28 and 51 of the Doha Declaration.

Current State of Negotiations 

Discussions in Geneva have continued around two proposals: one requiring WTO dispute panels to defer to MEAs in disputes; and the other proposing further sharing of experience of managing trade and environment policies in a complementary manner at the national level.

Progress has been more substantial on the issue of information exchange with and observer status for MEA secretariats. However, a permanent arrangement may be dependent on resolving the systemic concerns of some WTO members about the role of observers.

Negotiations on market access for environmental goods and services have made little progress.  Developed countries favour variations on an agreed list of environmental goods.  In contrast, developing countries would prefer to designate goods as “environmental” depending on their use in particular projects.

Contact

Department of Foreign Affairs and Trade
Office of Trade Negotiations
R.G. Casey building
John McEwen Crescent
Barton ACT 0221

Phone: + 61 2 6261 1889
Fax: + 61 2 6273 1527