WTO effectiveness in resolving transatlantic trade‐environment conflict

Abstract

Purpose

One of the major strategic challenges facing the transatlantic trade relationship is the ability to regulate such risk areas as the environment whilst maintaining important trade flows. Much scholarship has emphasised formal United States (US)‐European Union (EU) trade disputes when considering the treatment of risk. However, these cases represent a minority of the trade conflict at the World Trade Organisation (WTO). A majority of trade conflict gets raised, debated and resolved informally in the WTO committee structure. The Sanitary and Phytosanitary (SPS) Agreement is the WTO institutional arrangement that seeks to reconcile environmental, health and food safety regulations with trade objectives. The SPS embodies “in‐house” dispute resolution mechanisms that are based on the notion of constructive engagement. Mechanisms like ad hoc consultations, registering official protests, use of the chair's good offices and coordination with international standard setting organisations have been effective in promoting harmonisation between states. The paper aims to discuss these issues.

Design/methodology/approach

The paper traces the process that is embedded within the SPS Committee for resolving trade conflict over risk‐based regulations, highlighting a recent case in point of wood‐packing materials.

Findings

The paper elucidates a good news story about how American and EU policy makers utilize SPS Committee mechanisms to resolve differences over environmental regulations at the SPS Committee. Specific recommendations are offered on how to strengthen those mechanisms.

Practical implications

If the recommendations offered are followed, trade conflict resolution over risk‐based issues in the SPS context will be strengthened.

Originality/value

The paper is the first utilizing a case study to assess the effectiveness of WTO/SPS mechanisms for trade conflict resolution.

Citation

Hornsby, D.J. (2010), "WTO effectiveness in resolving transatlantic trade‐environment conflict", Journal of International Trade Law and Policy, Vol. 9 No. 3, pp. 297-309. https://doi.org/10.1108/14770021011075527