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Marc Benitah
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Yes, the analyses were different. But this does not answer the fundamental counterfactual question: Would the decision of the tribunal have been the same if the "full protection and security" ground was the sole ground at play in this case? My intuition that we will never know since it was a holistic decision.
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I think we essentially agree. Let us note that if we interpret the phrase in TPP 20.20(2)"may request consultations with any other Party...regarding ANY MATTER arising under this Chapter" as including a breach of the Paris Accord (or other MEA), this would mean that the TPP becomes the "police" of the Paris Accord. By limiting in TPP 20.4 their exhortation to commitments made in the Paris Accord (or other MEA), and NOT LINKING THEM IN ANY WAY to TPP obligations, TPP parties indicate that it is not their intention. Moreover, how would you be the police of the Paris Accord that says explicitly that its implementation mechanism is "not punitive"?
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Dear Brett, Concerning the second part of your comment, I note that the Paris Accord says explicitly that its implementation mechanism is "NOT PUNITIVE". This aspect will not be in line with the second step of your scenario. TPP parties are not going to suspend benefits in order to protect a violation of commitments in an accord that says itself that it does not intend to be punitive. As we say in French, "One cannot be more royalist than the king".
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I note that the exploratory suggestion by Brett Williams (see below) that Article 20.4 of the TPP could perhaps serve as a kind of "police" for the implementation of the Paris Accord or MEAs in general, adds another dimension to your intuition about kicking the can down the road to Trade Agreements. There is a danger of seeing tomorrow a situation where Trade Agreements are asked to become the "police" of the MEAS.
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Your reasoning is based on the premise that a "breach" of one of the Articles of the Paris Convention would be covered by Article 20.4 of the TPP. However, I read and reread Article 20.4 of the TPP and I am not convinced that it says such a thing. There is a phrase in this Article which point to this direction. It reads "implementation of these agreements[i.e. MEAs] is critical to achieving the environmental objectives of THESE agreements." Article 20.4 does not say that implementation of the MEAs is critical to achieving the TPP obligations.If that had been the case, I would agree with your scenario. In sum, my impression it that Article 20.4 of the TPP is simply an exhortation reminding TPP parties to implement MEAs. It does not create a situation where the TPP parties say that they intend to be the "police" for the MEAs. In other words, I read this
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Thanks for detecting a provisions that I did not notice. At first glance, I thought that I had really missed something important. However, after reading Article 24 of the UNFCCC, my impression is that the reference to this Article for dispute settlement, changes nothing to the soft law aspect of the Paris Accord. This is because, Article 24 contains the critical verb "MAY" in the passage: "When ratifying, accepting, approving or acceding to the Convention, or at any time thereafter, a Party which is not a regional economic integration organization MAY declare in a written instrument submitted to the Depositary that, in respect of any dispute concerning the interpretation or application of the Convention, it recognizes as compulsory ipso facto and without special agreement, in relation to any Party accepting the same obligation: (a) Submission of the dispute to the International Court of Justice; and/or (b) Arbitration in accordance with procedures to be adopted by the Conference of the Parties as soon as practicable, in an annex on arbitration." In other words, a party is not obligated to submit to a judicial dispute settlement mechanism. It may if it wants. If you compare the previous passage,with the equivalent Article in UNCLOS, you will notice that UNCLOS does not contain the critical word "MAY". An Unclos party has a choice for selecting a judicial procedure, but it must select one. In the UNFCCC, a party has the choice to accept or not the judicial dispute settlement process itself. I did not check how many parties have done so, but my guess is that there would be hard to find.
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Thanks for opening the door to a fascinating possible scenario in the TPP. Your crucial question is "but doesn't this mean that TPP members will have an ENFORCEMENT SYSTEM as against other TPP parties for the Paris Convention? at least for violations of the Paris Convention which have trade effects?" My first impression is that the answer to this question depends on the nature of the commitment of the TPP parties in Article 20.4 that you mention. Unfortunately, this commitment is "each Party affirms its commitment to IMPLEMENT THE MULTILATERAL ENVIRONMENTAL AGREEMENTS to which it is a party." These words do not seem to mean "violations of the Paris Convention which have trade effects?"which are the terms at the basis of your scenario. So, my first impression is that the scenario you suggest is not possible because of the way Article 20.4 of the TPP is formulated.
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I do not understand your reference to ITLOS as an example of the absence of a DS mechanism in UNCLOS. Article 287 of UNCLOS states clearly the existence of a DS mechanism in UNCLOS, although there is a choice of procedure. Choice of procedure 1. When signing, ratifying or acceding to this Convention or at any time thereafter, a State shall be free to choose, by means of a written declaration, one or more of the following means for the settlement of disputes concerning the interpretation or application of this Convention: (a)the International Tribunal for the Law of the Sea established in accordance with Annex VI; (b)the International Court of Justice; (c)an arbitral tribunal constituted in accordance with Annex VII; (d)a special arbitral tribunal constituted in accordance withAnnex VIII for one or more of the categories of disputes specified therein.
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Yes,you are quite right that this Accord kicks the can down the road to the WTO. Frankly, I did not this aspect even though it is obvious. The Accord adopt a "technological" and "capacity building" approach. One could say that it is written by scientists who do not seem to be aware (and probably do not care) of the consequences for the WTO. Even if one accepts this scientist approach, I do not think that the distinction between soft law and hard law is overstated. In my view, one must distinguish between "judicial international law" and other brands of international law. I know that international law textbooks do not adopt this distinction, fearing that this might create different grades of international law. However the fact is that in practice the distinction is crucial, but is not politically correct to say such a thing.
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The problem with your analysis is that the "paper" that you label "currency swap" is not included in the illustrative examples of direct transfer of funds (e.g. grants, loans, and equity infusion). This implies that the issue of whether ejusdem generis is applied forward or backward is critical. This is because it is likely that the AB would not consider "currency swap" as having ‘sufficient characteristics in common’ with one or several of the illustrative examples. By the way, the Wiley Rein & Fielding' position was that the currency swap is EXACTLY SIMILAR to equity infusion. However, I don't think that the AB will buy this view because equity infusion the AB has said that equity infusion involves as a central feature risk sharing. This feature is absent in currency swap. In sum, if you agree with me that "currency swap" has not sufficient characteristics in common with one of the illustrative examples, then how you interpret ejusdem generis becomes critical for the possibility of salvaging the existence of a Financial Contribution. NB: In the past, it was also my view that the benefit criterion is the only interesting question. However, the AB's "sufficient characteristics in common" doctrine has changed my view. This doctrine could deny the existence of a financial contribution if ejusdem generis is interpreted in a non traditional way. With the consequence that ONLY items similar to the illustrative examples could be considered as direct transfer of funds. I hope that the AB will forget in the future its obiter dictum footnote.
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Thank you very much for this precious information. Since this "convenient" version of the Appellate Body is an obiter dictum in a footnote, I hope that the Appellate Body will forget this footnote in the future. The footnote appears in a case where the Appellate Body used only the fact that NASA contracts were joint ventures similar to one of the examples following the general word "funds", namely equity infusion. They were therefore a direct transfer of funds. The Appellate Body never used a view where the general word "funds"can only contain things similar to the illustrative examples.
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Simon, Thanks for the post. Indeed, we learn a lot of things in this interesting speech. There is however an aspect that Roberto Azevedo could not talk about, and which is somewhat taboo. The impact of the bottleneck at the AB stage is in my opinion not only at the level of how many cases the AB can handle in a year. The impact is more subtle than that. That is because the bottleneck affects the legal quality of the AB rulings.
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Dear Arwell Tank you for this important precision. However, in Canada, there are two limitations to this alternative route for suspension of the contested measure. The first main limitation is that complaints before the national tribunal (CITT) must be filed within 10 working days of the day on which the “basis of the complaint became known or reasonably should have become known to the potential supplier”. The second limitation stems from the fact that if a bidder has raised an objection with the government body giving the contract, a complaint cannot be made until that body has refused the relief sought.
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Dear Regis Thank you for your precise and convincing comment. Since, de facto, suspensions of the contested measure, decided by panels, are to my knowledge nonexistent in WTO case law, I like your idea that there is a kind of “clause contraire” that stems from the WTO agreements. Namely: there is no interim protection mechanism in the DSU because the WTO agreements allow for unilateral measures of protection in specific emergency situations (Safeguards, Art. 5.7 SPS, etc.). Thank you also for your precision that interim protection is an inherent power of international courts and tribunals. All the Best, Marc.
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In fact this situation is like a snake biting its own tail,if we take account of GATS Article XIV bis entitled Security Exceptions: It provides that: Nothing in this Agreement shall be construed: (a)to require any Member to furnish any information, the disclosure of which it considers contrary to its essential security interests
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To Meme, Thanks for your comment. Following your comment, I have added in the post the following paragraph: Following MeMe comment, it is useful to signal that in WTO case law, the most relevant precedent is the Korea Beef case. The contested measure in that case was the Korean mandatory dual retail system where a supermarket could sell both imported and domestic beef but only as long as the imported beef and domestic beef were sold in separate sales areas. The Appellate Body upheld in that case the Panel's ultimate conclusion that Korea's dual retail system for beef was inconsistent with Article III:4 of GATT 1994. However, the Appellate Body emphasized that the crucial aspect was not the separation of the areas but the fact that the dual retail system for beef modified the conditions of competition in the Korean beef market to the disadvantage of the imported product. It is probable that Montebourg's separate shelves would modify the conditions of competition to the disadvantage of imported products by, among other things,singling out visually French products.
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Lorand, Thanks for answering so clearly my previous question. I notice that the WTO idea of "mandatory requirement by the executive branch" is absent in EU law. Apparently, the measure needs only to be "ATTRIBUTABLE AS A WHOLE TO THE GOVERNMENT AND PURSUED IN AN ORGANIZED FASHION THROUGHOUT THE NATIONAL TERRITORY". It is also interesting to see that this kind of measure is analysed in EU law paradoxically under the prism of "Quantitative restrictions" and not under the prism of national treatment.
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Rob, With regard to your first remark,I agree with its substance. I am afraid however that no panel would dare analysing a situation under the "despotic" scenario. You know better than anyone else how the WTO functions as an institution. It would never accept the adjective "despotic" in a ruling. As for your second remark, my impression is that Montebourg wants to go beyond origin labelling. Every buyer in France knows that Moulinex is a French firm and he does not even need an origin labelling. Montebourg wants special shelves in supermarkets. This probably goes against national treatment because the "offering for sale" is affected.
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Arwell, I have never seen a panel analysing a measure by asking if you would be allowed to promote the same measure in another country. In the same vein, panels would never accept the legitimacy of a measure because it is presented as a "counter measure" again an allegedly illegal measure by another Member. In short,my impression is that "reciprocal" arguments have no weight before a panel. I forgot most of what I have studied about EU law and I wonder if a Montebourg's mandatory measure could be contested by another EU Member before the European Court of Justice.
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Vitaliy, Regarding "de jure specificity", your intuition is apparently valid since the supermarkets would probably not be required to have products from a selective "discrete segment" of French firms. In practice, however, there could probably be "in fact specificity", since supermarkets would not be interested in proposing products covering all French firms.This would lead de facto to a " predominant use by certain enterprises". As for your second remark, you are I think referring to Article XXIII:1(b)relating to a non-violation claim under Article 5(b) of SCM (i.e nullification or impairment of benefits). I have just had a look at the three criteria in Japan Films, and apparently there is no obstacle to a non violation claim. However, my impression is that the label of the contested measure in such a claim does need to be connected in any sense to an "income or price support".
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Srikar, From a strictly legal point of view, the criterion for inconsistency is that the executive branch of a Member must be required to act inconsistently with requirements of WTO law. The scenario that you describe could be invoked by a Member at a WTO meeting in order to ask for time to arrange things. However, my impression is that its legal value before a panel is nil. There are precedents in GATT case law where "social" arguments were rejected by the panel.
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If you examine the measure analyzed by the panel for the city of Everett and determined to be a financial contribution and a subsidy (at 7.334), you will see cleary that it is a measure concerning FUTURE (i.e post 2006) revenue forgone 7.310 The Ordinance amends Chapter 3.24 of the Everett Municipal Code. The upshot of the amendment is that the B&O tax rate "upon every person engaging within the city in business as a manufacturer" is: Time period Tax rate 1 January 2006 – 31 December 2009 0.1% for the first $6 billion in value of products manufactured and 0.025% thereafter. 1 January 2010 – 31 December 2015 0.1% for the first $7 billion in value of products manufactured and 0.025% thereafter. 1 January 2016 – 31 December 2023 0.1% for the first $8 billion in value of products manufactured and 0.025% thereafter. 1 January 2024 0.1% The United States underlined this aspect (at 7.317) but the panel did not answer to this argument.
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Simon asks if he is reading too much in this excerpt. Well, I think that this is the case. The quoted passage in Colombia - Ports of Entry is very ambiguous. In fact, we don't know if the panel is referring to exceptions INCLUDED in a given WTO agreement,or to an extension of Article XX to other WTO agreements. It is impossible on the basis of the quoted passage to favor one reading over another. Im any case, this is a purely obiter dictum with no legal value.
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The most powerful legal argument against the "carry forward" thesis is that when negotiators wanted such a thing in the context of another WTO Agreement ,they said it explicitly in this another Agreement. This is precisely what the negotiators of the Agreement on Trade-Related Investment Measures (TRIMs Agreement) did. Article 3 of the TRIMs Agreement states that: “[a]ll exceptions under the GATT 1994 shall apply, as appropriate, to the provisions of this agreement.”
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Thanks Simon for raising this crucial issue. I remember that the first time I encountered this idea was in an article by Stone where he said: It is hard to believe that a nation that can portray its actions as honoring its obligations under UNCLOS should be vulnerable to trade charges under the SCM. In fact, a nation so charged might claim that the SCM CARRIED FORWARD BY IMPLICATION the “GENERAL EXCEPTIONS" defenses under GATT Article XX and that the measures mandated by UNCLOS were conclusively related “to the conservation of exhaustible natural resources.” In this manner, the WTO might resolve some of the apparent tension between trade law and resource conventions within existing frameworks. On the other hand, the uncertainty and potential for conflict warrant placing this issue on the diplomatic agenda for further discussion. It seems therefore that this issue could play a critical role in the interface between the SCM and Multilateral Environmental Treaties (MEAS). From a purely legal point of view, at first glance, I would say that the issue here is similar to the Dessicated Coconut case. In other words, are GATT and SCM an "inseparable package"? In other words, could one invoke GATT general exceptions without taking account of the fact that there is no reference in the SCM to these exceptions. Moreover the general interpretative note says that in case of conflict, the SCM trumps GATT. In sum, my first impression is that the silence in the SCM on this issue means that nothing is carried forward from GATT unless there is a "smoking gun" in the SCM.
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