On March 28

On this day in ...
... 1983, the Council of the European Communities prohibited the importation of seal-pup skins and related products pursuant to Council Directive 83/129/EEC. (photo credit) This ban on white pelts from baby seals, taken by means of a Canada hunt, did not end controversy, however; in recent years the European Union outlawed all importation. Just last month, officials said Canada intends to challenge the recent, total EU ban in the World Trade Organization.

(Prior March 28 posts are here, here, here, and here.)

On October 12

On this day in ...
... 1998, the Appellate Body of the World Trade Organization issued its report in a case brought by India, Malaysia, Pakistan, and Thailand, entitled United States - Import Prohibition of Certain Shrimp and Shrimp Products. The suit concerned a U.S. decision to restrict the importation of shrimp harvested by means that the United States determined risked undue "incidental taking" of endangered species of sea turtles. (credit for U.S. government photo of turtle escaping net thanks to the requisite TED device) The WTO Appellate Body interpreted Article XX of GATT, the General Agreement on Tariffs and Trade that governed the dispute, which permits countries to take certain actions that might limit trade in order to "protect...animal...life or health," or to "conserv[e]...exhaustible natural resources." The precise actions of the United States, though they fell within these exceptions, nevertheless were held in violation of the Article XX prohibition on "arbitrary or unjustifiable discrimination between countries where the same conditions prevail."

(Prior October 12 posts are here, here, and here.)

'Nuff said

(Taking context-optional note of thought-provoking quotes)

The NAFTA panel ruling in Stainless Steel Sheet appears contrary to previous decisions of the U.S. Court of Appeals for the Federal Circuit and arguably undermines the role of Congress and the Administration in implementing adverse rulings in WTO disputes. The panel’s reasoning may be affected by future pronouncements by U.S. courts on Charming Betsy and related issues.

-- Dr. Tania Voon (above left), Associate Professor of Law at the University of Melbourne and former Legal Officer of the Appellate Body Secretariat of the World Trade Organization, in an ASIL Insight entitled "NAFTA Chapter 19 Panel Follows WTO Appellate Body in Striking Down Zeroing." Haven't read the underlying 3-2 decision by the panel, which was adjudicating pursuant to NAFTA, the North American Free Trade Agreement. Am struck nonetheless by the majority's apparent treatment of the statement by John Marshall, Chief Justice of the United States, in Murray v. The Charming Betsy (1804) ("An act of Congress ought never to be construed to violate the law of nations if any other possible construction remains...") as something more substantial than a canon of statutory construction.

Beets banned

The most common sugar beet planted in the US is now banned.
Planting of Monsanto’s “Roundup Ready” sugar beets—a form of beet genetically modified to be resistant Monsanto’s glyphosate-based weedkiller Roundup—was banned Friday, by a federal judge in San Francisco, until the U.S. Department of Agriculture complies with the requirements of NEPA, the National Environmental Policy Act.
The ruling came in a lawsuit filed by environmental and organic farming nongovernmental organizations. The NGOs challenged the decision of the Agricultural Department to deregulate genetically engineered sugar beets without preparing an Environmental Impact Statement. Deregulation means that the crop could be planted freely throughout the United States, with no further regulatory oversight from the USDA. Critics complain that the department has routinely determined that genetically modified crops pose no threat to the environment without conducting an adequate assessment of the environmental risks posed by these crops.
In September 2009, the Court agreed with these critics. It found that the department's decision to deregulate genetically modified beets without first completing an Environmental Impact Statement violated the National Environment Protection Act. Friday’s ruling:
► Vacated the USDA’s deregulation of biotech sugar beets; and
► Prohibited any future planting or sale pending the agency’s compliance with NEPA and all other relevant laws.
The ruling allows the sugar beets already in the ground to be harvested, but bars further planting until the Environmental Impact Statement is complete. USDA has estimated that such a statement may be ready by 2012.
This decision comes on the heels of an 7-to-1 judgment issued by the Supreme Court in June (J. Breyer took no part in the decision). In that decision, Monsanto Co. v. Geertsons Seed Farms, the Court overturned a similar ban, on the planting of genetically modified alfalfa, again until the USDA completed an Environmental Impact Statement. The majority concluded that the scope of the injunction—which prohibited any partial deregulation of the biotech alfalfa until the statement was completed—was too broad.
The federal ruling issued Friday took Geerstons into account. Specifically, the judge was careful to leave room for interim measures that might allow planting to proceed, so long as:
► Interim measures adequately protect the public’s interest in completion of a thorough environmental assessment; and
► No irreparable environmental harm occur in the interim.
Unlike gentically modified alfalfa, which had yet to be commercialized, genetically modified beets currently make up the vast majority of the United States' crop.
Among the benefits claimed for the new technology, are the assertions that genetically modified beets

require fewer herbicide applications to effectively control weeds. Fewer trips across the field mean reduced greenhouse gas emissions, reduced soil erosion, reduced soil compaction and enhanced water conservation. These sugar beets are helping growers manage weeds, improve productivity and lessen impacts on the environment, while preserving a sustainable and geographically diverse supply of sugar.

Supporting Monsanto, the sugar beet industry also asserts:

Independent scientific analyses conducted by internationally recognized laboratories showed that the sugar from Roundup Ready sugar beets, which are enhanced through biotechnology, is identical at the molecular level, to the sugar from other, comparably grown sugar beets.

Even if true, molecular equivalence of the ultimate food product says nothing about the impacts that genetically modified beet plants might have on their environment.
In particular, the technology’s critics contend that gene flow between genetically altered crops and conventionally grown food, or wild relatives, might result in irreversible genetic pollution. This concern has particular traction with sugar beets because genetically modified beets have been embraced by farmers and now representing about 95% of the sugar beet crop, accounting for about half the United States' annual sugar production.

Genetically modified crops in the United States fall in a nether zone—a patchwork of federal regulation under the auspices of the Agriculture Department, the Environmental Protection Agency, and the Food and Drug Administration. In theory, no genetically engineered organism is approved for commercial use until its proponent has demonstrated that the GM organism conforms with the standards set by federal law. Unfortunately, the gap between theory and reality is significant. Part of the problem is that no regulatory agency has a clear statutory mandate to regulate agricultural biotechnology. As a result, no coherent, overarching government policies ensure that this new technology is safely explored and exploited.

The regulatory regime governing biotechnology crops dates back 25 years, to 1986, when the Office of Science and Technology finalized the Coordinated Framework for Regulation of Biotechnology.

The Coordinated Framework, a product of the sharply anti-regulatory Reagan administration, embraced the notion of “substantial equivalence”—that genetically modified organisms were functionally equivalent to their unmodified counterparts and should be treated accordingly. Thus, the Coordinated Framework proclaimed that no new laws were needed to respond to challenges posed by this new technology. Instead, regulatory authority was parceled out to various agencies based on their existing statutory authority.

At its most superficial, the regulatory regime established by the Coordinated Framework is very easy to describe: Food and Drug Administration is responsible for food safety; Environmental Protection Agency is responsible for microbes and pesticides; and the Animal and Plant Health Inspection Service, an agency within USDA, is responsible for all plants. Each agency concentrates on its own narrow piece of the genetic modification universe. With no single agency considering the full range of problems posed by genetically modified crops, regulatory gaps are inevitable. Critics assert that overarching safety questions go unexplored. Because of the assumption of substantial equivalence, the burden of proof is on the authorities to prove that a genetically modified organism is unsafe before they may impose use restrictions.

This ruling highlights a significant breaking point between the supporters and opponents of genetically modified crops.

Supporters point to molecular similarity of the endproducts, while opponents focus on differences in the plants themselves. The approval standards in the United States don’t require consideration of some key environmental concerns. This leaves big gaps and unknowns in the science.

Whether this lack of information as reason for concern or reason to relax depends significantly on one’s perspective about whether regulation should be precautionary or reactive.

Indeed, the United States and the European Union have differed sharply on this point, leading to a 3,000-plus-page World Ttrade Organization dispute resolution decision that, while it ruled for the United States, left this key question unanswered.

There is a difference between a demand for certainty, and a demand that appropriate questions be explored. The former focuses on results—do the fruits of exploration point so conclusively to a particular outcome that no other explanation is tenable. The latter addresses process—has the exploration been structured in a fashion likely to uncover relevant information. Both sets of demands can be obstructionist—the insistence of the Tobacco Institute insistence that the link between cigarettes and cancer was “not proven” is perhaps the best example of how a demand for certainty can be wielded to prevent otherwise reasonable social actions. However, to suggest that demands for more or more appropriate study are always or even predominantly obstructionist is to caricature wholly legitimate and important public participation in public decisionmaking.

The lack of a transparent, well-organized regulatory system threatens public trust in biotechnology and, more fundamentally, in government itself. The success of agricultural biotechnology depends fundamentally on society’s willingness to accept and consume food produced via this technology. This willingness hinges on the level of trust that the technology is being developed and used in a safe manner. Adequate regulatory oversight and information gathering are central to the future of the technology.

Human Rights & Business: Beyond Corporate Social Responsibility

(Delighted to welcome back alumna Nadia Bernaz, who contributes this guest post)

With BP making the headlines with the industrial disaster in the Gulf of Mexico (prior IntLawGrrls posts), many have been asking the question of how and whether giant corporations can be made accountable for their actions.
The fact is that a combination common in the Western world -- tighter laws governing pollution and higher standards -- has not worked. Rather, it has often meant that multinational corporations, which no longer have to respect national boundaries, move elsewhere, where standards are lax and land and labour is cheap.
The growing movement for volunteerism among corporate entities based on corporate social responsibility has had some benefit: it has highlighted the social responsibility that companies have when they invest in a given area. (Prior IntLawGrrls posts) However, it has also allowed many corporations to engage in green-washing their image through the display of sophisticated policies printed in expensive brochures.
A new story that has attracted some attention recently concerns the activities of the Vedanta mining concern, one of Britain’s largest companies, who have built an aluminium producing plant in Orissa, in the east of India. Vedanta now wishes to mine bauxite in the region in order to get the plant running at full capacity.
Orissa is one of India’s least developed states, with some of the poorest people in the world, with many indigenous tribes among them. It has been known for a long time that this part of India holds significant deposits of mineral resources, but with India speeding towards accelerated development, these resources have suddenly become crucial to sustaining growth.
Vedanta maintain that their mining activities would bring jobs and increasing wealth to the local population. However, the indigenous Dongria Kondh tribe strongly oppose mining in their sacred mountains, and are concerned about the environmental impact of this activity in the region. An Amnesty International report issued in February supports their view.) The tribal members argue that they do not want to change their ancestral way of life, and have no interest in the type of development Vedanta has promised them. (credit for photo by Parth Sanyal /Reuters, captioned "A tribal woman with her child near the mining site of the alumina refinery in Orissa state")
From an international legal perspective, the Vedanta story raises several important issues:
► The increased power of transnational corporations has made the seeking of accountability for their actions extremely difficult in environments where they may be able to operate freely, and often with the complicity of the government.
► While globalisation itself cannot be regulated, it is clear that new norm creation activities have been taking place in international law, not least with the presence of the World Trade Organisation.
► However, little of the ethos concerning human development and poverty alleviation feeds into these important discussions.
To address these challenges, my home institution, Middlesex University in London, England, has created an MA programme in Human Rights and Business. The course covers areas of law such as international human rights law and the law of the WTO, and explores the relevance of these areas to multinational corporations -- especially those corporations operating in emerging economies. The modules are deliberately human rights law-centred, and go significantly beyond the concept of corporate social responsibility. The programme itself is tailored for busy professionals with significant online content and class contact restricted to two days a month (Friday-Saturday). More information here.

The WTO wants YOU!

WTO-detractors have long accused the organization of being a "secret society" where deals are struck in dark, smoke-filled rooms far away from the public eye. Admittedly, the organization has not been very effective in addressing the complaint--at least not in the early years of its existence when a typical response would be that the World Trade Organization is a "government to government" institution. Translated from the bureaucratic-speak, it essentially meant there was no room for public participation. Civil society and the average citizen were expected to liaise with their home institutions rather than with the WTO. But times have changed.
After years of public protests, along with scholarly reflections on the institution's lack of legitimacy precisely because it operated in the shadows, the WTO had a public relations makeover of sorts. The membership changed the rules to allow for public access to some meetings--including dispute settlement meetings--for example, and the WTO began to hold an annual civil society conference meant to serve as a forum for public participation. This year, the organization has taken things one step further and sponsored a contest seeking . . . YOU! That's right, the WTO "invites you to participate in a video contest to tell us your views about the key forces shaping world trade."
So if you ever wondered just how you might give the institution a piece of your mind on their policies and practices, here is your chance. All you have to do is upload a YouTube video and send a link to mailto:%20publicforum2010@wto.org and you could be on your way (don't forget to check out the terms and conditions). I wonder if they'll have the world call in to choose the next WTO-Idol?

Developing Countries Confront Global Economic Crisis

The global economic meltdown was so yesterday. Seldom does the crisis make it on to the front pages of any of the major newspapers anymore, but the struggle for recovery continues in the shadows. Already, fissures are appearing in the once-unified front of the developed countries. European governments such as Germany are calling for a greater focus on controlling deficit spending, while President Obama has called for more spending to shore up flagging economies. But while the North struggles over the various modes of recovery, the developing world must deal with the fallout. This week, for the first time the World Trade Organization is set to discuss the impact of the financial crisis on those countries. A powerful coalition of developing countries, including India, South Africa, Argentina and Ecuador, had lobbied vigorously for such a discussion because in their view the North's massive bailouts amounted to illegal subsidies that have adversely impacted financial markets in the developing world. Can these bailouts prompt a WTO dispute brought on by developing countries?

Hamid Mamdouh, director of the WTO's services division, is reported to have said "There is a legal cover for situations where members might deviate from their legal commitments and obligations" but the situation is not so clear cut. The General Agreement on Trade in Services (GATS) does include what is known as a "prudential carve-out," which is meant to allow regulators the policy space to address financial crises. Article 2 of the GATS Annex on Financial Services states that a WTO member “shall not be prevented from taking measures for prudential reasons.” The prudential carve out is subject to WTO dispute settlement, however, if a member believes the provision is being abused, is discriminatory or is a disguised non-tariff barrier to trade. The matter has never been litigated before, and what standard of review the WTO would apply under the circumstances is an open question.

But would a developing country (or a group) actually raise a dispute settlement claim? Beyond the legal issues, there are both economic and political considerations for developing countries to deal with. Countries like the United States have the political clout to fend off a potential case. Moreover, the economic recovery of the North is in everyone's interest -- developing countries rely on their markets, not to mention their technical and financial assistance. A dispute on this issue -- at least in the near future -- seems unlikely. But this makes the upcoming discussions at the WTO all the more important. The organization must provide a forum to at least acknowledge that developing countries are another in a long line of innocent victims of this economic crisis (photo credit).

Precautionary principle, anyone?

2 things jump to mind about the "Swamp Tour" my family and I took years ago through Louisiana's bayous:
► Try though we did, none of us caught even a glimpse of a 'gator.
► Even back then, those wetlands were mighty fragile.
Today the bayous that buffer New Orleans from the Gulf of Mexico are under siege. More than 200,000 gallons of oil a day are spewing into the Gulf as a result of an offshore rig explosion on April 20. (prior post) That's 4 million gallons and counting.
Already the environment is harmed. Tar balls, "sticky, dark-colored blobs," are washing up on beaches. So too dead animals -- turtles, fish, dolphins. Fishing families are out of work. These and other effects will be felt for years.
Nor is any sure solution in sight. Rather, as Rebecca posted, what's heard is one "Maybe this'll work?" after another. Televised computer-modeled animations of the (to date, failed) efforts make MouseTrap (left) look like serious business.
Odd, then, that not much seems to have been said so far about the precautionary principle.
As international environmental lawyers well know, that principle has origins from this passage in the 1992 Rio Declaration on Environment and Development:

Principle 15
In order to protect the environment, the precautionary approach shall be widely applied by States according to their capabilities. Where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environmental degradation.

In essence, the precautionary principle is a call for recalibration of cost-benefit analysis. When failure of an activity would cause a truly dire catastrophe, even the remotest possibility of that result requires the exercise of extra-special care. It's a rule of risk aversion.
But it can be costly, for its application may bar the activity, altogether or at least for the foreseeable future. And if the activity is something like drilling for oil, that obstacle means higher prices and lost profits.
Not surprising, then, that although the precautionary principle has retained some currency, it has not won full embrace.
It's positive law in City of San Francisco, but pretty much nowhere else in the United States. Westlaw cites only 10 federal cases that have used the term; none has applied it as a justiciable legal norm. Here's perhaps the fullest discussion, an explanation of why the court rejected a motion to dismiss that had invoked the principle:

The Plaintiffs' claims were based on the European Council's “Precautionary Principle” and the European Commission's “Science and Society Action Plan.” Neither document has been incorporated into domestic law, by international treaty or otherwise.

Sancho v. U.S. Dept. of Energy (D.Hawai‘i 2008).
And though the principle has applicability with regard to food, health, and the environment in the European Union, elsewhere abroad there's hesitation. What in 1992 was a "principle" has since been given a more discretionary phrasing -- "precautionary approach" -- by entities as varied as the International Law Commission, the International Tribunal of the Law of the Sea, and the WTO Appellate Body. (On the "subtle, but important, difference" between these terms, see Caitlyn's comment below.)
Approach? Principle? Whatever, the underlying idea seems like one that deserves consideration as the country reconsiders drilling in the wake of the Gulf Coast disaster. To be debated? A policy of requiring extra care before giving the go-ahead to something, when failure would cause damage too big to contain.
Call it Too Big to Fail.

Where and when transnational law develops

(Part 3 of a 3-part series of guest posts by Mireille Delmas-Marty)

Having traced the development in France and the United States of transnational law processes such as cross-referencing, harmonization, and hybridisation, we now examine the questions of where and when transnational law develops.

Location of transnational Law
In the United States, much of the development of transnational law seems to be found at the national level, given the significance of the roles played recently by the Supreme Court regarding cross-referencing and, to a lesser extent, harmonisation.
In France, the national level also remains important. But the international regional level also is very much in play. National judges are becoming international judges, in the sense that they may, and must, exclude national law when it is contrary to European law. European statutes and case law increasingly are incorporated into domestic law. Just as Americans say,

"International law is part of our law,"

recalling the statement in Paquete Habana (1900), we in France say,

"European law is part of our law."

The global level, finally, is the right answer in some areas. This may be seen in, for example:
► Criminal law, in which international conventions have initiated global movements toward change. There may be no European prosecutor -- an innovation that I advocated in my work on Europe’s Corpus Juris project -- but there is already a global prosecutor, in office at the International Criminal Court.
► Environmental law, in which the 1997 adoption at the global level of the Kyoto Protocol, which set targets for regulating greenhouse gases has spurred legal reforms in France and other states and at the European regional level.

Timing of transnational law
The proliferation of international conventions designed to bring about change in the transnational legal world provokes scrutiny of the final question of when -- at what pace -- transnational law develops.
It seems unrealistic to demand implementation of international conventions at the same time in every place. It is thus not surprising to discover the emergence of legal practices allowing states to incorporate various norms of international law at their own pace. This multiple-speed mechanism of implementation -- which I have labeled "polychrony" in my book Ordering Pluralism (trans. Naomi Norberg 2009) -- may contribute to the ordering of legal pluralism. That is because it enables the integration process to continue without the slowest wagon dictating the speed of the convoy, as former German Chancellor Helmut Kohl once put it.
Examples of polychrony:
► At the European level, some states welcome passport-free circulation within the multinational borders of what’s known as the Schengen area, while other states lag behind, maintaining strict controls at their own national borders.
► At the global level, Article 3(1) of the 1992 U.N. Framework Convention on Climate Change articulates a principle of "common but differentiated responsibilities" that establishes different time tracks for reduction of greenhouse gases. The same method was suggested as a way for the World Trade Organisation to allow developing countries to make commitments according to their means and abilities, rather than to exclude them from multinational discussion for the reason that they cannot integrate at the most rapid speed.
In effect, embrace of polychrony transforms a strategy of accepting derogation from multistate legal norms into one of anticipating conformity to those norms. Risks remain, however: integration by the mechanisms of transnational law may result in the disintegration of national and international laws.

Conclusion
Scrutiny of legal pluralism in the transnational legal world reveals not a well established global legal order, but rather interactions between national and international systems that play out in apparently contradictory, nonlinear, disorderly movements. It is a world in which new processes, extremely complex, continue to evolve. Legal systems seem to change form almost as soon as they take shape, long before we have had the time to determine their outlines.
This contemporary reality departs from the hierarchical pyramid-of-law metaphor advanced decades ago by the jurist Hans Kelsen. I suggest that we replace the image of the static pyramid for that of dynamic clouds. The cloud metaphor aptly represents the continuity of formation and deformation ongoing in Europe. It applies too at the global level, where individual experience and interests represent fragments of an ever-changing sky.
Let us dream of the day when a common core of values might in a single breath order our marvelous clouds without forcing them to stay in a single space.

(Part 1 of this 3-part guest post, which introduced comparison of the French and U.S. approaches to the transnational legal world, is here; Part 2, on how transnational law develops, is here.)

On November 30

On this day in ...
... 1999 (10 years ago today), what had been scattered anti-globalization demonstrations the day before, of a ministerial meeting of the World Trade Organization in Seattle, turned into street protests that, according to a website set up by the University of Washington libraries, "forced the delay of the WTO opening ceremonies." Soon joining in were "youthful, out-of-control, self-proclaimed 'anarchists'"; by midday local police "ran low on tear gas, bus service was suspended downtown, and many businesses closed their doors." (credit for photo of police directing pepper spray at protesters on this day) A state of emergency and curfew were declared; "forced retreat" occurred amid vandalization of local businesses. Collapsed WTO talks would be resumed in 2001 at Doha, Qatar.

(Prior November 30 posts are here and here.)

On April 15

On this day in ...
... 1994 (15 years ago today), in Morocco, the 7-1/2 years of trade negotiations known as the Uruguay Round ended with adoption of the Marrakesh Protocol to the General Agreement on Tariffs and Trade 1994. Ministers from nearly all the participating 123 countries signed the Marrakesh Agreement, as it is known. This agreement led to the establishment the following year of the World Trade Organization (logo above), and to an ensuing Doha Round of trade negotiations, still under way.
... 1989 (20 years ago today), in Beijing, Hu Yaobang, the deposed General Secretary of the Chinese Community Party, died of a massive heart attackthe news, people began to gather in Tiananmen Square, where paid tribute to Hu, whom leaders had forced out of office 2 years earlier. This Washington Post story explains that Hu

is remembered by many Chinese for overturning cases against millions persecuted during Mao Zedong's political movements and launching the economic and political reforms that ended the turmoil of the Cultural Revolution.

In addition to honoring Hu, those who gathered that day also voiced discontent with the regime governing China. The event thus proved a catalyst for the Tiananmen Square democracy demonstrations that roiled the city in the next months.

(Prior April 15 posts are here and here.)

On April 10

On this day in ...

... 1874 (135 years ago today), the 1st official Arbor Day was celebrated, in Nebraska, by proclamation of that state's Board of Agriculture. "Prizes were offered to counties and individuals for planting the largest number of trees," and it's "estimated that more than one million trees were planted in Nebraska" on that day alone. Over the years the idea took root. The U.S. government celebrates it on the last Friday in April -- this year, April 27. Various states opt for various dates, no doubt in keeping with varied planting seasons. Same holds for countries outside the United States:

Variations are celebrated as 'Greening Week' of Japan, 'The New Year's Days of Trees' in Israel, 'The Tree-loving Week' of Korea, 'The Reforestation Week' of Yugoslavia, 'The Students' Afforestation Day' of Iceland and 'The National Festival of Tree Planting' in India.

It is, after all, the fact, and not the day, of planting that matters.

... 1963, Doris Leuthard (right) was born in Merenschwand, Switzerland. In 2006 Leuthard was elected to the Swiss Federal Council, making her the Council's 5th woman member ever (another, elected in 2002, is Micheline Calmy-Rey, about whom we've also posted). Leuthard is now the Vice President of the Federal Council, which constitutes the executive authority of the Swiss government. She is also Head of the Federal Department of Economic Affairs, and thus in charge of Swiss economic, labor, and trade policies, among them conduct of Doha Round negotiations of the World Trade Organization. An attorney by training, she had been President of Switzerland's Christian Democratic People's Party before joining the Federal Council. (photo credit)


(Prior April 10 posts are here and here.)

Trade & Culture: Paths to (Re)conciliation

My warm thanks to IntLawGrrls for inviting me to contribute a guest post. It is a splendid initiative to report on relevant international law topics from a female perspective (and I do love the pink background).
Having the IntLawGrrls’ floor, I would like to share some ideas stemming from my current research, which focuses on the relationship between trade and cultural norms at the international level, taking into particular account the impact of digital media. As a sort of a broader research agenda on the theme, I published an article in the Journal of International Economic Law. But lately, I have also been trying, in my paper entitled "Trade and Culture: Keep the Border Fuzzy, Please," to go a step further and discuss the fuzzy borders between trade and culture, and whether and how we could manage them in the contemporary media environment.
The pair “trade and culture” can be singled out and deservedly labelled as unique in the “trade and …” discourse. The reasons for this exceptional quality lie in three points:
► The first is the intensity of the relationship, which is indeed most often framed as “trade versus culture,” and has been a significant stumbling block, especially as regards audiovisual services during the Uruguay Round of negotiations of the World Trade Organization (logo above left) and subsequently.
► The second specificity of the relationship is that the international community has organised its efforts in a rather effective manner to offset the lack of satisfying solutions within the WTO framework. The 2001 Universal Declaration on Cultural Diversity, adopted under the auspices of UNESCO, the United Nations Educational, Scientific and Cultural Organization (logo below right), and the legally binding UNESCO Convention on the Protection and Promotion of the Diversity of Cultural Expressions, came into force two years ago this month, are clear signs of the potency of the international endeavour, on the one hand, and of the (almost desperate) desire to contest the existing WTO norms in the field of trade and culture, on the other.
►A third distinctive characteristic of the relationship between trade and culture -- one that is rarely mentioned and blissfully ignored in any Geneva or Paris talks -- is that while the pro-trade and pro-culture opponents have been digging deeper into their respective trenches, the environment in which trade and cultural issues are to be regulated has radically changed. The emergence and wide spread of digital technologies have modified profoundly the conditions for cultural content creation, distribution and access, and have rendered some of the associated market failures obsolete, thus mitigating to a substantial degree the “clashing” nature of trade and culture. Under the conditions of the digital media space, any trade restriction may in fact be counterproductive to a thriving cultural environment, and the focus on “trade versus culture,” especially in the classical context of audiovisual services, may be too narrow and thus fail to recognise the augmented significance of other regulatory domains (such as intellectual property).
In this sense, there is a pressing need to re-evaluate the existing tools of media regulation, including those targeted at the protection and promotion of cultural diversity. Such regulatory experiments would certainly unfold first at the domestic level; however, paradoxical as it may sound, it could be that the WTO offers better solutions than UNESCO when these matters are to be taken up at the international level.

JFK's Trade Legacy

This year marks the 45th anniversary of JFK's assassination in Dallas, Texas. To commemorate the occasion, and to celebrate the President's historic visit to the University of North Dakota shortly before his death, UND held an exciting interdisciplinary conference entitled "John F. Kennedy: History, Memory, Legacy."

Attendees included such luminaries as Ted Sorenson, the President's speechwriter, and Richard Reeves, the noted former New York Times columnist. Also in attendance was my colleague Brian Landsberg who began working at the Justice Department's Civil Rights division in 1964. Over his 30 year tenure at Justice, Brian litigated many of the landmark civil rights cases of the last century--including cases on school desegregation and voting rights. I was privileged to have also been invited to the conference to discuss Kennedy's trade legacy.

Although few outside of trade circles recognize it, Kennedy has had a powerful influence on the modern trading system. He managed to get Congress to pass the Trade Expansion Act of 1962 at a difficult time both domestically and internationally. On the domestic front, a powerful oil lobby oppossed trade liberalization, the U.S. economy was in a recession, American workers feared the impact of a trade deal on their jobs, and a fairly isolationist general public was suspicious and resistant to a new trade deal. Internationally, JFK had to confront a newly-expanding European Community, the struggle for the hearts and minds of developing countries, and of course The Cold War. Despite these many competing interests, Kennedy recognized the needs of the United States was best served by a trade deal that provided greater economic opportunity for all. He masterfully worked with competing constituencies to ensure passage of the Act.

As a result of his efforts, the Kennedy Round of international trade negotiations was launched at the GATT (the precursor to the WTO). Although he would not live to see the launch of the Round, Kennedy's legacy was historic. When concluded, the Kennedy Round changed the face of international trade, shifting from a primary focus on tariff reductions to the important work of providing a legal structure for trade.

Kennedy was neither a fierce supporter or opponent of free trade. Rather, he recognized that, properly managed, free trade provided more benefits than detriments. He was ultimately a pragmatist, and both the country and the world was better of for it. I hope the next president studies and emulates Kennedy's successful trade policies.

WTO law and India's patent limitations

Thanks for giving us the opportunity to guest post on our research concerning the relationship between free trade and intellectual property rights, set forth in our paper entitled How Innovative is Innovative Enough? Reflections on the Interpretation of Article 27 TRIPS from Novartis v. Union of India. The case studied is relevant, first, for understanding how developing countries can implement the law of the World Trade Organization (logo below right) in a way that is not harmful to their economies; second and more generally, to defy the misconception that WTO law demands the implementation of ‘pro-patents’ patentability standards.
In 2006, a major lawsuit was initiated by the Swiss pharmaceutical company Novartis AG. It targeted Section 3(d) of India's Patents Act. As amended in 2005, states:

(3) The following are not inventions within the meaning of this Act, --
(d) The mere discovery of a new form of a known substance which does not result in the enhancement of the known efficacy of that substance or the mere discovery of any new property or new use for a known substance or of the mere use of a known process, machine or apparatus unless such known process results in a new product or employs at least one new reactant.

In its lawsuit Novartis petitioned the High Court of Madras (left) to declare that Section 3(d) did not comply with the 1994 Agreement on Trade-Related Aspects of Intellectual Property Rights, better known as the TRIPS Agreement. On August 6, 2007, all the petitioner's requests were rejected by the High Court of Madras. The Court did not enter into the merits of the compatibility question, however, as it ruled that it had no jurisdiction on that issue.

Our analysis begins where the verdict of the High Court of Madras ends, as we study the compatibility question in substantive terms. The core of the question relates to the interpretation of Article 27 of TRIPS, which sets out the criteria for patentability (i.e. an invention should be non-obvious, novel and useful). Section 3(d) of India's Patents Act, which identifies cases of inventions that are non-patentable, can be conceptualized as a rule establishing heightened patentability standards. This makes it more difficult for a patent applicant to be granted patents.

Are the standards endorsed by Section 3(d), we ask, compatible with Article 27 TRIPS?

We conclude that they probably are. Our conclusions are derived from the analysis of the economic effects of the disputed rule. This analysis is due because the TRIPS Agreement lists among its purposes the promotion of social and economic welfare (Article 7 ). Customary rules of interpretation of public international law provide that the purposes of the Agreement are to be taken into account in order to clarify the wording of ambiguous rules; in this case the rule set out in TRIPS Article 27.

To assess whether Section 3(d) may contribute in achieving greater welfare, we reviewed a number of economic studies. Some focused on the general effects of a heightened nonobviousness standard; others, on the more contingent issue of the welfare effects of stringent patent regimes on the post-2005 Indian market for pharmaceuticals. Most of these studies suggest that Section 3(d) may contribute to promote welfare. Accordingly, it is likely to be compatible with the TRIPS Agreement.

Our analysis has a number of interesting implications. Most crucially for a general understanding of Article 27 TRIPS, we have shown that the degree of stringency of the patentability standards is far from obvious! ‘Pro-patents’ patentability standards do not necessarily enhance innovation; to the contrary, in many circumstances they can stifle it. This means that the belief that in the post-2005 regime India ought to adopt ‘pro-patents’ patentability standards is misguided. The standard carved into Section 3(d) appears legitimate, therefore; other developing countries may decide to follow suit.

(More WTO news below)

And for more on the WTO ...

... check out this ASIL Insight on the latest development in the trade battle over cotton prices.
That battle began in the last decade, explains the author, Professor Karen Halverson Cross (left) of Chicago’s John Marshall Law School. Brazil complained that subsidies the United States paid its cotton farmers had violated 2 World Trade Organization pacts; in particular, the Agreement on Agriculture. A WTO compliance panel agreed. Cross published on earlier steps in the litigation here; her Insight focuses on the June ruling in which the WTO Appellate Body sustained the compliance panel.
The ruling is unlikely to end the dispute at this time, when broader trade talks have failed, Cross writes. Brazil is expected to resume arbitration in an effort to secure countermeasures – that is, payment in the billions of dollars on account of the United States’ violation – and may even seek to retaliate.
Stay tuned.

The Impact of Terrorism on World Trade

Part 2 of a 2-part series

After four years of silence, last week Abdul Qadeer Khan, the father of Pakistan’s atomic bomb, gave his first interview since being placed under house arrest. A now unrepentant Khan repudiates the televised tearful confession he made back in 2004 in which he admitted to smuggling nuclear equipment and technology in shipping containers to such states as to Libya, Iran and North Korea. The resurrection of Abdul Qadeer Khan from obscurity raises anew the question of how safe is the world's trade supply chain--and specifically shipping containers--against a determined terrorist?

In my last post, I introduced the Container Security Initiative--U.S. Customs' response to the threat that a shipping container could be used by terrorists to transport a nuclear bomb to the United States. CSI is meant to "extend [the United States'] zone of security outward," by stationing U.S. Customs agents in ports all over the world (with consent of the host) where they can work with officials to identify suspect containers and inspect them before they ever arrive on U.S. shores. Opting to implement the program in three stages, Customs initially excluded from CSI membership all but the top twenty "megaports" —those ports that send the largest volume of container traffic to the United States. In Phase II of the project, ports of political or strategic significance can join, provided they meet certain criteria. Only in Phase III will ports that require technical assistance and capacity building—those ports in developing countries—be considered for CSI membership. The net result was that for years, only European and a few Asian ports were CSI-certified. Only recently have ports in Africa (South Africa was the first), the Caribbean and Latin America been added to the program. (map credit)

Membership in CSI comes with significant benefits. The idea is that containers arriving from CSI ports are deemed "safe" and ordinarily will not be subject to additional inspection in the United States. They receive "head of the line" privileges. Moreover, if the unthinkable happened and the nation's seaports were closed because of a terrorist threat, CSI-containers would again receive preferential treatment once normal business resumed.

The problem with CSI first and foremost is that the U.S. government itself acknowledges the nuke-in-the-box scenario, around which CSI is designed, is unlikely to occur. A report by the Government Accountability Office found "the likelihood of containers being used to move WMDs to the United States is low." Given that reality, it seems difficult to justify a measure that so significantly changes the trading system to the detriment of developing countries. By delaying admission of developing countries in the program until the last stage, Customs has created disincentives for businesses to source their supply from those countries. For a company, the risk of sourcing goods from a country without a CSI-certified port may be too great given the potential for such goods to stagnate at a U.S. border awaiting inspection (even a single day’s delay at Customs adds almost 1% to the cost of goods).

In a much longer piece on this question, I argue CSI violates World Trade Organization rules because it provides a benefit to some members and not other, which is contrary to the most-favored-nation requirement of GATT Article I. Although GATT Article XXI provides a general exception for national security reasons, I argue the national security exception must be read in light of a "development dimension." In other words, even as rich countries take measures to respond to terrorism and other security concerns, they must still consider the impact such measures are likely to have on developing countries.
The truth is, we cannot ensure our security without ensuring the security of others. It is far better to create a system where we raise world standards on security without relegating developing countries once again to the periphery.

In closing, I wanted to let the IntLawGrrls community know I recently launched my own all-trade-all-the-time website to talk about free trade related issues in a balanced, smart and fair way. I look forward to a long and active run with this blog, but the website gives me the opportunity to write on some of these issues in much greater depth (although not as deep as a law review article!) Check it out at http://www.tradevoices.com/

(Cross posted at Conglomerate, a business-law-economics-society blog)

Creating Effective Assistance Programs for Poor Countries

Funding for technical assistance, particularly in the ever-controversial area of international trade, continues to grow. Every year, both the World Trade Organization and individual member states spend millions of dollars funding technical assistance programs in the developing world. The goal of these programs is to assist developing countries in building the legal infrastructure and institutional capacity to export their goods and services effectively and to attract foreign investment in order to support their development objectives.
In my last post, I asked whether trade-related technical assistance can help poor countries develop. Ultimately, I believe that it can—with some limitations. Assistance will never propel poor countries to prosperity, but it can become a stepping stone to greater participation in world trade. If will managed, trade can lead to greater wealth; it certainly has done so far a number of countries, including China and the “Asian Tigers.”
But some have dismissed technical assistance as a “joke.” Stories of waste, graft, ineptitude or just plain stupidity abound in the technical assistance world (see, for example, Matt Bivens’ article, Aboard the Gravy Train: In Kazakhstan, the Farce That Is U.S. Foreign Aid, in which one assistance provider allegedly took off his swim shorts to give them to a government official who expressed an interest in them; the provider feared if he didn’t keep the official happy, he might not get a renewal of his USAID-funded project). In his book Globalization and its Discontents, one of the most distinguished critics of technical assistance programs, Nobel Prize laureate Joseph Stiglitz, decries the heavy-handed, one-size-fits-all approach of the International Monetary Fund. Similarly, Amy Chua’s World on Fire highlights the dangers of technical assistance projects that export U.S.-style free markets and democracy to developing countries without the legal and regulatory mechanism to protect against a “market-dominant minority” hijacking the bulk of economic activity.
The technical assistance programs described by Bivens, Stiglitz, Chua and others clearly fall within the bounds of “what not to do”. But technical assistance itself is not a dirty word. As I mentioned in my previous post, to be effective, however, technical assistance must meet certain criteria: (1) Individual projects must have “buy-in” from the recipient country; (2) Assistance providers would do well to remember the human emotions—suspicion and fear on the part of recipient countries must be addressed (“why are they here? What do the really want?”); and (3) Neither recipients nor beneficiaries should offer up more than they can afford to give away (i.e., don’t take your pants off for anyone—literally or figuratively).
In this post, I want to explore other models of assistance that work in partnership with developing countries to achieve goals and objectives identified by the recipients rather than imposed by the donors. Specifically, partnerships between developing countries and universities in the developed world hold out much promise as an effective model for providing technical assistance training. Because many of the trade-related technical assistance projects focus on building a legal infrastructure for development, partnerships between laws schools and beneficiary countries look to be particularly promising.
The World Trade Organization has recently adopted programs that foster such partnerships. In Africa, the WTO works in partnership with local universities to deliver training programs throughout the Continent. Faculty members from the region co-teach some of the courses with WTO personnel. And the WTO is committed to working with local universities to build their capacity in trade law; the universities are expected to play a lead role in course delivery in the future. The promise of these programs is that when technical assistance providers leave, there will be a cadre of educated professionals in the beneficiary country ready, willing and able to “do for themselves.”
In many ways the WTO model offers the perfect opportunity for U.S. law schools. U.S. academic institutions can provide for faculty and student exchanges as well as long-term advanced legal training, thus increasing the pool of local experts and broadening the depth of institutional expertise. U.S. law schools and universities have the comparative advantage in building knowledge, and I believe more of them should get involved in technical assistance projects.
Technical assistance is no joke but a very serious business. If done well, it provides a real opportunity for poor countries to make progress.

Can Assistance “Save” Poor Countries?

Part I of a 2 Part Series

There is no question globalization has created significant riches for some countries; China and India are the two examples that come to mind. Yes, I recognize these successes are rather imperfect: China’s economic rise comes with frightening environmental costs we are just beginning to recognize, and the meteoric rise in India’s stock exchange cannot seem to eliminate the crushing poverty of millions of its citizens. But those consequences are at least in equal parts driven by a country’s own internal decision making as by globalization. In short, globalization produces wealth, and then we as fallible human beings do what we do best: We muck it up.
In this series, I want to move beyond the debate on globalization. Readers of my posts by now recognize I believe globalization comes with costs and benefits that must be adequately managed. Often they are not. The more complex and interesting question to me is whether we can use technical assistance to assist countries currently shut out of the world economy. Can transferring knowledge and providing aid and technology really lead to economic prosperity for poor countries? In other words, can technical assistance “save” developing countries?
Let me be upfront and say I may be somewhat biased; I have worked in technical assistance for almost half of the twelve years I’ve spent focused on international trade law. My interest has primarily been on Africa because I love a good challenge! Like everyone else, I want to believe my work makes a difference in the world. And I have had some measured and incremental successes to prove it. But have I ever seen a poor country rise to economic prominence because of the technical assistance work of another? Well, I’m an optimist so I’d have to say . . . not yet. In this post, I want to examine some of the problems in technical assistance delivery, and in the next explore some potential solutions.
Some claim trade-related technical assistance is a joke. Amy Chua in her book World on Fire recounts the story of the Americans in Mongolia who were sent out to advise the government on building free markets. The consultants were heartened when officials asked for several hardcopies of the voluminous U.S. securities laws—photocopied on only one side of the page. It turns out the Mongolians were not true converts to the U.S. system; they merely wanted to use the documents for scrap to alleviate the government’s chronic paper shortage. A few years back, Matt Bivens published Aboard the Gravy Train: In Kazakhstan, the Farce That Is U.S. Foreign Aid in Harper’s Magazine. Bivens claimed when a local Kazakhstani bureaucrat fancied a technical assistant provider’s red swim trunks, the advisor was forced to strip down and hand them over because angering the Kazahkstani bureaucrat might jeopardize his chance of returning to the bottomless well of USAID renewal contracts.
So, what can we learn from these and other stories of technical assistance failures? Three key points I’d like to make:

(1) Successful technical assistance requires “buy-in” from local officials and other key players
It sounds obvious, but it’s easier said than done. Remember, the money from these projects is coming from some rich country abroad, so for local officials it’s a “can’t lose” opportunity. That doesn’t necessarily mean the project is well-conceived, or that the recipient country is truly willing to implement it. For years I have thought recipient countries should “invest” in technical assistance. If it is something they really want—if they see a benefit in the project—then they should be willing to “pay” for it, either in cash or sweat equity. Few of us appreciate that which is given to us for free.

(2) Beware of the human emotions
Technical assistance providers arrive in the recipient country under a cloud of suspicion. Even as people are smiling and inviting you over to dinner, you can’t help but notice the question carefully hidden in their eyes: What does she want? It is not an illogical question; after all, technical assistance is not truly “free.” Rich countries provide it because they do want something—implementation of more favorable foreign investment laws, for example. And it isn’t as if the recipient country is blind to that reality: One African official characterized technical assistance provided by the World Trade Organization (and funded by rich countries) as “ideological.” In his view, providers came “to tell us what to think, what our positions should be.”
It is impossible to have a successful project unless these emotions are openly acknowledged and handled. The truth is, successful technical assistance is always “win-win.” Rich countries wouldn’t provide the funds if there was nothing in it for them, but recipient countries can work to ensure implementation also serves their interests.

(3) Don’t take your pants off for anyone

Enough said.