Fishy business

The US policy to restrict tuna imports hampers free trade, says the GATT panel report

 
By Ravi Sharma
Last Updated: Saturday 04 July 2015

-- THE United States has once again lost the battle to use trade measures to determine not only tuna fishing methods but also the impact of tuna fishing on other species. In response to a complaint by the Netherlands and the European Community, the second panel report of the General Agreement on Tariffs and Trade (GATT) declared, in a supposedly highly-secret report leaked in June, that the US policy to restrict the import of tuna is inconsistent with the principle of free trade. The judgement was supported by Canada, Japan, New Zealand, Thailand, Venezuela and Australia, according to who the US act was tantamount to claiming jurisdiction over all yellowfin tuna from the Pacific region, which was internationally-traded.

The panel experts agreed that dolphin stocks "could potentially be exhausted". It also found that although Article XI.1 prohibits trade restrictions other than duties or taxes, the domestic policies pursued by the United States over the vessels within its jurisdiction is in agreement with GATT, as Article XX (g) allows trade restrictions that relate to the conservation of exhaustible natural resources. However, it says that the policy to prohibit imports of tuna is not consonant with the principles of GATT.

As tuna are often found swimming below dolphins in the eastern Pacific Ocean, fishing vessels in that region commonly encircle dolphins with purse-sein nets in order to capture tuna. In 1986, this resulted in the death of an estimated 133,000 dolphins. However, by 1991, changes in fishing equipment and methods reduced total deaths to less than 27,500. To reduce dolphin mortality to less than 5,000 by 1999, the governments of major tuna fishing countries signed an agreement under the auspices of the Inter-American Tropical Tuna Commission (IATTC) in 1992.

Penal provisions
The US also passed the Marine Mammal Protection Act in 1972, prohibiting any person or vessel under its jurisdiction from killing any marine mammal in connection with the harvesting of fish. The Act also prohibits the use of any fishing method contrary to those allowed under the Act and imposes civil penalties for violations. It further prohibits the import into the United States of tuna or tuna products harvested by a method that results in the incidental killing or serious injury of marine mammals in excess of United States' standards. In order to meet this requirement, the tuna exporting country must prove that it has fishing technology and a rate of incidental taking comparable to those of the United States.

In the case of imports of yellowfin tuna from the eastern-tropical Pacific, the US has set 5 guidelines. First, the exporting country must have a regulatory programme, comparable to that of the US, governing the incidental killing of marine mammals in the course of harvesting. This includes regulations on activities such as encircling marine mammals and setting nets at sundown. Second, the vessels of the harvesting nation must have a rate of incidental taking of marine mammals comparable to that of US vessels, which implies harvesting no more than 1.25 times that of United States vessels during the same period. Third, the vessels of the harvesting nations must not incidentally take in a given year more than 15 per cent of the total eastern spinner dolphin taken by such vessels and not more than 2 per cent of coastal spotted dolphin.

Fourth, the rate of incidental taking by the harvesting nation must be monitored by the IATTC or by others under a similar approved programme. Fifth, the harvesting nation must comply with all reasonable requests by the United States for cooperation in specified research programmes.

With the GATT panel finding these laws inconsistent with Uruguay Round Act, the US has been asked to "bring the above (trade) measures into conformity with its obligations under the General Agreement". The panel did not find it "necessary" to restrict the import of tuna from a country that does not follow tuna harvesting practices and policies similar to the US, to protect dolphins and believes that the US can find alternative measures that are consistent with GATT provisions.

The GATT ruling does not challenge the basic concept of using trade measures to achieve "sustainable development". In a qualifier added to its ruling, the panel said that the issue in this dispute was not the validity of the environmental objectives of the United States to protect and conserve dolphins, which, as Australia pointed out, it cannot judge, even if they were unilaterally set. According to the report, "The issue was whether, in the pursuit of its environmental objectives, the US could impose trade embargoes to secure changes in the policies which other contracting parties pursued within their own jurisdiction."

The ruling also clarified that countries that are not directly affected by a trade restriction are allowed to raise it in GATT meetings, as the agreement is about conditions of competition for trade, not on volume of trade. Further, legislations can be challenged even before any action is taken to follow it up. The impact of the ruling, therefore, is not likely to discourage countries using trade measures for environmental purpose.

Heat in the offing
Some US environmental groups are, nevertheless, agitated by this ruling and heated discussions are expected to follow. Micky Kantor, the chief trade negotiator of the US, also plans to make it a public issue by asking for a NGO debate on the ruling and calling for support on the use of trade measures to "up-grade the environmental policy of other countries to the US level".

The ruling is, however, binding unless all the contracting parties, which include the US, reject the report.

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