MEGA-TRADE AGREEMENTS: COULD THEY BECOME THE FOREMOST VEHICLE TO UNIFY GLOBAL AND REGIONAL ENVIRONMENTAL LAW?

• Author: Radley, Maxwell C.
• Position: NOTE

1. INTRODUCTION

   In this note, I will discuss how mega-trade agreements, like the all-but-defeated Trans-Pacific Partnership ("TPP") and Regional Comprehensive Economic Partnership ("RCEP"), present an opportunity to create binding international environmental law and discuss the evolution of environmental protection provisions in trade deals over time. I will first offer an analysis of the ramifications of developing international environmental law that has been taking shape in the international community and the creation of international customs and norms--primarily through the means of Convention of International Trade in Endangered Species of Wild Fauna and Flora ("CITES"). Second, I will provide an analysis of some of the environmental declarations and goals within the World Trade Organization ("WTO"). Thirdly, I will discuss how regional cooperation has been currently undertaken, providing a look at the North American Free Trade Agreement ("NAFTA") and analyzing its effectiveness. Lastly, I will discuss the TPP and RCEP and current provisions in those agreements, if any, that concern environmental protection and how a concerted effort could be put forth to combat climate change in a particularly environmentally sensitive region.

   The recent international interest in pursuing mega-trade agreements like the TPP and the RCEP offer participating states a unique opportunity to enumerate and bring to force environmental protections in a more comprehensive and orchestrated manner. International norms are the first steps in the creation of international law, and international environmental law is currently seen following this trend, (1) thereby taking the next step to institutionalize environmental law regimes, which currently have limited effect. (2) The regional trade agreements that are currently in place typically have environmental protection provisions incorporated in them. For example, both the Association of Southeast Asian Nations ("ASEAN") and the NAFTA have forms or mechanisms of environmental regulation to provide for concerted environmental efforts. (3) As we will see, the provisions included in these agreements have varying enforceability, and they provide an ability to coordinate their efforts. These provisions provide a more comprehensive and effective approach, rather than the piecemeal approach that is being undertaken in some regions (including the United States as a natural function of federalism) (4) and ensures the undertaking of environmental action, as these agreements are quasi-binding or aspirational with regard to environmental regulations. (5)

   Through the examples given by the TPP and RCEP, I aim to show that mega-trade agreements place member states in an awesome and unique position to be able to address climate change and protect their environment, while also increasing their country's prosperity. The crux of my argument is that the binding nature or the availability to provide technical assistance to these mega-trade agreements will provide a forum that will allow international environmental law to gain traction and guide arbiters to heed domestic and regional environmental concerns. Additionally, we will need to consider states' acquiescence in relinquishing some sovereignty to agree to the terms of the agreement. This is no small task, particularly in developing states, because they do not have the standard of living that provides their constituents the ability to focus on protecting the environment. (6)

   As mentioned previously, we are taking a piecemeal approach globally, which leaves much to be desired when trying to effectuate progress towards sustaining the environment and combating climate change. (7) This derives from the fact that there is a multitude of ways in which environmental provisions are currently being enforced in bilateral treaties. (8) A 2011 report by the Organization for Economic Co-operation and Development ("OECD") identified the mechanisms that countries use in bilateral treaties, which include:

   1. General references to environmental concerns in preambles;

   2. Right to regulate--reserving policy space for environmental regulation;

   3. Reserving policy space with respect to certain treaty provisions;

   4. Precluding nondiscriminatory regulation as a basis for claims of indirect expropriation;

   5. Environmental matters and investor-state dispute settlement;

   6. Not lowering standards--couraging relaxation of environmental standards to attract investment; and

   7. General promotion of progress in environmental protection and cooperation. (9)

   This provides evidence of the tools that may be used to promote environmental law and protections in investment treaties, but that may not be entirely effective. What I set out to show is that megatrade agreements provide the prime vessel to facilitate the concession of some sovereignty to promote cooperation, as has been done in previous agreements. (10)

2. CREATING INTERNATIONAL ENVIRONMENTAL LAW

   1. General Process of Creating International Law

      To aid the enforcement of international law, Abbot et al. have argued that the international community has to balance three factors: obligation, precision, and delegation. (11) The balance of these factors creates the "hard" or "soft" nature of the law. (12) Abbott et al. further argue that the growing institutions in the realm of international law allow for an increase in a governing legal structure--"hard" law. (13) Moreover, in the realm of free trade agreements ("FTAs"), these agreements are usually binding, and by their very nature are hard laws because they create precise obligations that the member states must adhere to or be subject to discipline stated in the agreement. (14) The nature of the FTA agreements signals the necessity for firm direction in the world of environmental law, rather than allowing corporations' profit margins to decide matters before them. (15)

   2. Ramifications of the Increased Utilization of International Environmental Laws

      The inclusion of hard environmental laws in treaties raises an important question: would the parties' interests be best served by allowing the most powerful state party to the treaty the ability to choose the environmental stance other member states should take? (16) Perhaps the same could be said for the business matters of these smaller states. It is difficult to reconcile the leverage that the larger states maintain over the smaller economies of developing states because the smaller countries stand to gain the most from the liberalization of their economies. (17) Of particular concern is that these states are likely to be highly dependent on natural resource trade for income and bargaining power while negotiating. (18) The biggest concern that has come to light is that implementation of hard environmental laws will likely realize an increase in expenditures by the developing states to cure regulatory and technological shortfalls. (19) These states are subsequently in a less competitive position to be able to pay for timely technological advancements and may not have the political will to pass these laws. (20)

      The difficulty comes during the process of negotiating the multilateral trade agreements. In trade negotiations, there are multiple levels at which negotiations are conducted. (21) At the lower levels of negotiation, the smaller nations can align themselves with similarly positioned states and subsequently either force out environmental provisions that are not acceptable, or address other environmental issues that may not be in the forefront of the larger states' agenda, forcing a gridlock. (22) Additionally, though it is difficult to negotiate the wide-ranging interests in multilateral agreements, it is easier to negotiate the interests in multilateral agreements for larger states, which include additional terms that are not particular to trade. (23) As such, this may subject the developing states to a "race to the bottom" situation or may force the developing states to accept terms that may not be adequate for their situation, once a state breaks ranks. (24)

   3. CITES as an Example of Successful Environmental Cooperation

      CITES is one of the oldest (established in 1975) (25)--and typically regarded as one of the most successful--international environmental treaties. (26) With approximately 178 member countries currently, CITES is notable because of the institutional framework that enables effective decision-making, namely the requirement of a two-thirds majority vote to adopt a provision, (27) rather than the typical consensus requirement other like institutions require, which causes delay in adopting provisions. (28) However, that is where the differences end. CITES is a voluntary compliance organization, like many others, geared at providing member states guidance on the subject matter as it comes into play with international trade. (29) Agreements passed through CITES do not supersede domestic law, but instead provide guidance for domestic legislation to facilitate implementation at the national level for member states. (30) Admittedly, CITES does work to solve the conflicting interests of multilateral trade rules (issues with most favored nation) because the framework of CITES allows countries to implement provisions as they deem fit. (31)

      Although CITES has been deemed a successful international cooperation agreement, it loses the appearance of such when the issue of animals with high commercial value arises. (32) It takes no stretch of the imagination to realize the challenges that developing countries may face in working to protect threatened species of flora and fauna since they must concurrently work to improve their local economy and the standard of living within their own borders. (33) Whenever the stakes are high, economic concerns will take precedent if there are not proper safeguards in place, (34) exemplifying the issues of voluntary compliance and international environmental concerns because of the necessity...