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With respect to the GATT perspective, the product-related PPM requirements affect and alter the final characteristics of the product, while the non-product-related PPM requirements do not reflect the final characteristics of the product.
“GATT rules in this area apply to measures taken by governments to satisfy PPM requirements, whether the measures are taken unilaterally or pursuant to obligations under a MEA.”
C. the Montreal Protocol and the GATT
The provision of WTO permits their members to take unilateral action in pursuit of environmental ends, the circumstances are carefully defined, and the actions are subject to challenge under the GATT/WTO disputes procedures. Since the original negotiations, the trade restrictions have grown to occupy a more important role in the Montreal Protocol, and the issue of compatibility with the GATT has been considered more actively. Major concern has been caused by the reports of two GATT disputes panels, in 1991 and 1994, on trade measures taken by the US in the tuna-dolphin (see Annex 1) disputes.
Whatever the weaknesses of the US case in the tuna-dolphin disputed, the reports of the two panels appeared to cast considerable doubts over the GATT-compatibility of the Montreal Protocol. It control measures lead to quantitative restrictions on trade; its trade provisions directed against non-parties can be applied against WTO members who are not Protocol signatories, and envisage trade restrictions on the basis of PPMs; and both sets of measures could be regarded as extrajurisdictional. Before moving on to examine these specific points of potential conflict, however, it must be remembered that no disputed has in fact arisen within the GATT or WTO over the application of trade restrictions under the Protocol. Although the two agreements do appear to conflict with each other, the world community is committed to them both, and wishes to see them both succeed, and there fore wishes to avoid bringing conflicts to the level of formal disputes mechanisms.
The terms of the Montreal Protocol are entirely transparent, both in their international and domestic application, and the trade measures are explicitly aimed at restricting trade between parties and non-parties. There is, therefore, no disguised restriction. A possible alternative interpretation of this phrase would require and examination of the degree of protectionist intent of the measures—but this has not been the approach of GATT panels so far.
Necessity of trade measures for the protection of life and health is a difficult area. The terms of the Montreal Protocol, drawn up and revised with constant reference to scientific assessments of the extent and costs of ozone depletion, and the relative costs and benefits of abatement actions, could certainly be regarded as qualifying under a scientific test of the necessity of the measures taken. However, in recent years GATT disputes panels and reports have progressively narrowed the scope of the ’necessity’ exemption, interpreting it increasingly as ‘least GATT-inconsistent’ or ‘least trade-restrictive’. This behavior is reinforced by other elements of the GATT, such as the TBT Agreement.
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