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What
was it all about?
In
eastern tropical areas of the Pacific Ocean, schools of
yellowfin tuna often swim beneath schools of dolphins.
When tuna is harvested with purse seine nets, dolphins
are trapped in the nets. They often die unless they are
released.
The
US Marine Mammal Protection Act sets dolphin protection
standards for the domestic American fishing fleet and for
countries whose fishing boats catch yellowfin tuna in
that part of the Pacific Ocean. If a country exporting
tuna to the United States cannot prove to US authorities
that it meets the dolphin protection standards set out in
US law, the US government must embargo all imports of the
fish from that country. In this dispute, Mexico was the
exporting country concerned. Its exports of tuna to the
US were banned. Mexico complained in 1991 under the GATT
dispute settlement procedure.
The
embargo also applies to “intermediary”
countries handling the tuna en route from Mexico to the
United States. Often the tuna is processed and canned in
one of these countries. In this dispute, the
“intermediary” countries facing the embargo
were Costa Rica, Italy, Japan, and Spain, and earlier
France, the Netherlands Antilles, and the United Kingdom.
Others, including Canada, Colombia, the Republic of
Korea, and members of the Association of Southeast Asian
Nations, were also named as “intermediaries”.
The panel
Mexico
asked for a
panel
in February 1991. A number of "intermediary"
countries also expressed an interest. The panel reported
to GATT members in September 1991. It concluded:
- that
the US could not embargo imports of tuna products
from Mexico simply because Mexican regulations on
the way tuna was produced did not satisfy
US regulations. (But the US could apply its
regulations on the quality or content of
the tuna imported.) This has become known as a “product”
versus “process”
issue.
- that
GATT rules did not allow one country to take
trade action for the purpose of attempting to
enforce its own domestic laws in another country
— even to protect animal health or
exhaustible natural resources. The term used here
is "extra-territoriality".
What
was the reasoning behind this ruling? If the US arguments
were accepted, then any country could ban imports of a
product from another country merely because the exporting
country has different environmental, health and social
policies from its own. This would create a virtually
open-ended route for any country to apply trade
restrictions unilaterally — and to do so not just to
enforce its own laws domestically, but to impose its own
standards on other countries. The door would be opened to
a possible flood of protectionist abuses. This would
conflict with the main purpose of the
multilateral
trading system
— to achieve predictability through trade rules.
The
panel's task was restricted to examining how GATT rules
applied to the issue. It was not asked whether the policy
was environmentally correct. It suggested that the US
policy could be made compatible with GATT rules if
members agreed on amendments or reached a decision to
waive the rules specially for this issue. That way, the
members could negotiate the specific issues, and could
set limits that would prevent protectionist abuse.
The
panel was also asked to judge the US policy of requiring
tuna products to be labelled “dolphin-safe”
(leaving to consumers the choice of whether to buy the
product). It concluded that this did not violate GATT
rules because it was designed to prevent deceptive
advertising practices on all tuna products, whether
imported or domestically produced.
P.S. The report was never adopted
Under
the present WTO system, if WTO members (meeting as the
Dispute
Settlement Body)
do not by consensus reject a panel report after 60 days,
it is automatically accepted (“adopted”). That
was not the case under the old GATT. Mexico decided not
to pursue the case and the panel report was never adopted
even though some of the “intermediary”
countries pressed for its adoption. Mexico and the United
States held their own bilateral consultations aimed at
reaching agreement outside GATT.
In
1992,
the European Union lodged its own complaint.
This led to a second panel report circulated to GATT
members in mid 1994. The report upheld some of the
findings of the first panel and modified others. Although
the European Union and other countries pressed for the
report to be adopted, the United States told a series of
meetings of the GATT Council and the final meeting of
GATT contracting parties (i.e. members) that it had not
had time to complete its studies of the report. There was
therefore no consensus to adopt the report, a requirement
under the old GATT system.
On
1 January 1995, GATT made way for the WTO.
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| The
US Marine Mammal Protection Act: The
US Marine Mammal Protection Act (MMPA) prohibited
the “taking” (harassment, hunting,
capture, killing or attempt to do any of these),
and importation into the US, of marine mammals,
except with explicit authorization.
It
governed, in particular, the taking of marine
mammals incidental to harvesting yellowfin tuna
in the Eastern Tropical Pacific Ocean, an area
where dolphins are known to swim above schools of
tuna.
The
act meant a ban on the importation of commercial
fish or products from fish which have been caught
with commercial fishing technology which results
in the incidental kill or incidental serious
injury of ocean mammals in excess of US
standards.
In
particular, the importation of yellowfin tuna
harvested with purse-seine nets in the Eastern
Tropical Pacific Ocean was prohibited (primary
nation embargo), unless the competent US
authorities established that:
(i)
the government of the harvesting country had a
programme regulating the taking of marine
mammals, comparable to that of the US, and
(ii)
the average rate of incidental taking of marine
mammals by vessels of the harvesting nation was
comparable to the average rate of such taking by
US vessels.
The
average incidental taking rate (in terms of
dolphins killed each time in the purse-seine nets
are set) for that country’s tuna fleet were
not to exceed 1.25 times the average taking rate
of US vessels in the same period. Imports of tuna
from countries purchasing tuna from a country
subject to the primary nation embargo were also
prohibited (intermediary nation embargo ).
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| Legally
speaking: Mexico
claimed that the import prohibition on yellow fin
tuna and tuna products was inconsistent with
Articles XI, XIII and III of GATT. The US
requested the Panel to find that the direct
embargo was consistent with Article III and,
in the alternative, was covered by Articles XX(b)
and XX(g). The US also argued that the intermediary
nation embargo was consistent with
Article III and, in the alternative, was
justified by Article XX, paragraphs (b), (d) and
(g).
The
Panel found that the import prohibition under the
direct and the intermediary
embargoes did not constitute internal regulations
within the meaning of Article III, was
inconsistent with Article XI:1 and was not
justified by Article XX paragraphs (b) and (g).
Moreover, the intermediary embargo was not
justified under Article XX(d).
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