The streets of Seattle look like a war zone. Fifty thousand protestors lead by labour and environment groups have been met by troops and tanks. Tear gas, "flash bombs", and rubber bullets are being used by the troops against U.S. and Canadian citizens. North America hasn't seen anything like this since the massive protests against the Vietnam War in the early 1970's. The protests are highly unusual given that this generation of youth have been relatively calm and conservative in their concerns for finishing school, obtaining jobs, and earning money. What would make citizens rise up like this after 25 years of calm? Are the problems with free trade and WTO that serious? What would make conservative environmental organizations like the Natural Resources Defense Council (NRDC), the U.S. Sierra Club, and the Humane Society of the United States call for their millions of members to go to Seattle and express their concern? What has driven the normally cautious National Wildlife Federation (NWF) and the National Audubon Society to join efforts to change WTO to make it more environmentally responsive?

These groups generally deal with local habitat, wildlife conservative and toxic chemicals issues. Why have they called on their tens of millions of combined members in the United States and Canada to go to Seattle and protest WTO. Normally, these environmental groups are comprised of members in support of free trade. What has caused them to take rubber bullets and tear gas in the streets of Seattle? What would concern them so much that they would mobilize resources establish more than 20 websites on WTO and begin actions that include a massive counter conference in Seattle to the official WTO governmental conference? Here are some of the answers.

CONCERNS ABOUT THE ENVIRONMENT AND WTO

The concerns about the environment were sparked by actual setbacks to environmental protection imposed by the GATT/WTO and by other free trade agreements such as NAFTA (Chapter 11). National laws to protect the environment are now being challenged under WTO by other countries as being non tariff trade barriers. As a result, the national laws have been stuck down voluntarily by countries that have signed on to the WTO agreement. The environmental groups are seeing a secondary trend under the rubric of free trade that involves neutralizing the many national environmental laws and multinational environmental agreements (MEA's). Let's take a look at some of the concerns.

CANADA APPEARS TO BE BACKING WTO EFFORTS TO BLUNT NATIONAL ENVIRONMENTAL LAWS

Canada has been one of the leading advocates in asking other nations to rethink their environmental laws under WTO and expressing concern about the negative trade impacts of multi lateral environmental agreements like the Kyoto Climate Change Protocol. Canada's Department of Foreign Affairs and International Trade (DFAIT) has seen a number of important environmental laws implemented by other countries as non tariff trade barriers aimed at restricting the sales of Canada's natural resources. Issues that concern DFAIT include,

o England's and France's decision to restrict the use of   asbestos in construction, DFAIT is challenging this decision since Canada is a major exporter of asbestos

o Europe's decision to restrict consumption of seal pelts and restrict the purchases of furs from animals trapped in inhumane ways. Canada wants to continue and expand the sales of seal skins and wild animal furs trapped in the north

o some European countries' decisions to restrict purchases of lumber and paper products that are clear cut or come from old growth forests.

DFAIT is challenging these environmental decisions under WTO trying to force the countries to buy Canada's wood and paper clear cut from Canada's last stands of old growth forests.

With Canada's provinces reducing their own environmental protection budgets by more than 40% and making decisions to get environment out of the way of economic progress, Canada may become a nation that must meet environmental requirements imposed by other nations' environmentally friend purchasing decisions or by Multilateral Environmental Agreements (MEA's). One can understand Canada going to the WTO meeting in Seattle with an agenda to blunt the power of MEA's and independent decisions by other countries to "green" their environmental purchasing habits. See the DFAIT website on WTO at http://www.dfait-maeci.gc.ca/tna-nac/menu-e.asp

VENEZUELA WINS TRADE CHALLENGE TO SELL DIRTY GASOLINE IN THE U.S.

Venezuela launched a challenge under GATT against a decision by the U.S. Environmental Protection Agency (EPA), under the U.S. Clean Air Act, to reduce emissions from reformulated gasoline. Venezuela successfully challenged the amendment to the US Clean Air Act that required foreign gasoline refiners to make the same improvements to gas quality as the average US refinery. The challenge was brought by the Venezuelan government, but the real pressure to challenge the regulation came from the subsidiaries of the same multinational oil and gas companies that had failed to keep the U.S. EPA from passing tougher environmental laws in Washington, D.C. Now foreign importers like Venezuela and Canada can choose to export to the U.S. gasoline that is dirtier than refineries in the U.S. are required to make, resulting in imported gasoline damaging air quality and human health in major US cities.

U.S. MAY CHALLENGE JAPAN'S DECISION TO CLEAN UP AIR EMISSIONS FROM CARS

While California has been a world leader in legislating cleaner auto emissions, Japan is considering revolutionary legislation that would substantially reduce the amount of pollutants that cars can emit in Japan. The legislation would virtually require most people to drive small cars with small engines with great mileage. None of the mid to large size cars manufactured in the U.S. and Canada could meet the proposed new stringent requirements. The U.S. government has told Japan this could violate WTO rules because the requirements would fall mainly on medium sized cars, which is the class of most US car exports to Japan. While the new Japanese legislation may be interpreted as a non tariff trade barrier, it is also a potential new leader for other countries to follow its lead in actually cleaning up urban air pollution.

GATT/WTO DECISION STOPPED DOLPHIN PROTECTION

The United States under its Marine Mammal Protection Act attempted to stop the practice of tuna fishermen following pods of dolphin that were chasing tuna and scooping up both tuna and dolphins in their nets. The dead and dying dolphins were thrown overboard and the tuna harvest and sent to market. The U.S. stopped its own tuna fleets from harvesting tuna in this manner. But the Mexico tuna fleets challenged at the GATT/WTO the decision by the U.S. not to import tuna that was caught using the environmentally harmful method. Surprisingly, Mexico won the challenge and the U.S. was forced to allow imported tuna into the United States that were caught by the old method. Environmental groups cooperated with grocers in the U.S. and started labelling cans of tuna as "dolphin safe" for those tuna that were caught without catching dolphin. But that labelling may also be subjected to a WTO challenge as an impediment to free trade. It is possible the U.S. laws like these will no longer be implementable, and eco labelling may not be applicable at all under the WTO. That is why the environmental groups are calling for "safe trade" measures that include rules for environmental protection.

WHY ARE ALL THE PROTESTORS WEARING TURTLE SHELLS?

They are concerned about a recent WTO decision against the U.S. in its decision not to purchase shrimp from regions that are destroying turtle habitat and incidently capturing endangered species of turtles in their shrimp nets. The WTO decision will require the U.S. to voluntarily continue to purchase shrimp from process and production methods (PPM's) that are resulting the decimation of endangered turtle species. 

The Sierra Club, National Audubon Society and others wrote that, "the U.S. Administration must also reject as a solution to the dispute (proposed by the WTO) the use of "shipment- by- shipment certifications" of shrimp caught with turtle excluder devices. Due to the nature of the industry, the certification of individual shrimp shipments cannot be verified, and will not adequately protect sea turtles. Such a solution will also not immunize U.S. law from future WTO challenges. Put simply, a shipment-by-shipment solution to this decision is both substantively and politically unworkable."

The major U.S. environmental groups continued in their letter to President Clinton, that "the WTO Shrimp/Turtle case is a critical opportunity for the Administration to reestablish its former leadership role in trade and environment by confronting this damaging WTO panel decision. The decision renders meaningless the environmental exceptions in Article XX and contorts the language of the WTO's own charter in order to maintain a uniform ban on policies targeted at preventing environmental damage from the way a product is produced ("process and production methods"). It also fails to respect an international consensus, reflected in legitimate multilateral environmental agreements, concerning the importance of protecting endangered species." See the full letter sent by the Sierra Club U.S., Center for International Environmental Law, Center for Marine Conservation, Community Nutrition Institute, Defenders of Wildlife, Earth Island Institute, Earthjustice Legal Defense Fund, Friends of the Earth, Humane Society of the United States, National Audubon Society, National Wildlife Federation, Natural Resources Defense Council, on April 21, 1998, See the full letter at http://www.sierraclub.org/trade/environment/turtles2.asp

WTO STRIKES DOWN EFFORT BY EUROPE TO KEEP HORMONES OUT OF BEEF

Canada and the United States use hormones and other chemicals in cattle to enhance their growth, milk and meat production. New health studies show that the hormones are suspected of increasing cancer and other diseases in the populations that consume huge amounts of milk, milk products and meat. European countries have taken the lead in trying to get hormones out of beef and milk. However, Europe lost a challenge at the WTO in their attempts to ban the importation of beef from Canada and the United States loaded with artificial hormones. The action by Europe was interpreted as an attempt to protect its beef industry by establishing a non tariff trade barrier using environmental and health concerns to better their economic sales of meat.

GENETICALLY MODIFIED FOODS BAN CHALLENGED UNDER WTO

Canada and the United States plan to use the WTO to challenge Europe's decision not to eat food that contains genetically modified organisms (GMO's). Europe is concerned that GMO food production and consumption can harm the environment and health. Canada and the United States want to challenge Europe's plan to not produce or import GMO food such as soybean and potatoes. A draft Seattle WTO Ministerial Declaration contains a proposal by the US and Canada that the WTO establish a working party on Biotechnology to look at the "adequacy and effectiveness" of existing rules on GMOs. Greenpeace International is quite concerned stating that, "it is ironic, given that the US and Canada have this year vigorously opposed negotiations on effective international rules to govern the use of GMOs in food and agriculture. A Biosafety Protocol, under the Convention on Biodiversity, was to set rules on the international movements of GMOs which would give countries a right to say no to GMOs on environmental grounds (threats to biodiversity)."

But the talks collapsed after the US and Canada led opposition to the inclusion of GM commodity crops in the agreement. A WTO Biotechnology Working Group, if agreed, is likely to undermine the adoption of the Biosafety Protocol scheduled in January 1999." Source, Greenpeace International, website http://www.greenpeace.org/ Also see Friends of the Earth website at  http://www.foe.org/international/wto/freetrade.html

It is interesting to note, that despite Canada's Dept of Foreign Affairs attempts to block the European ban of GMO's, one of Canada's largest food companies, McCain Foods Ltd., has decided to not produce GMO potatoes, and instead it will process clean potatoes and potato products that can be exported to Europe. See McCain's website at http://www.mccain.com/

ECO LABELLING AND GOVERNMENT GREEN PROCUREMENT THREATENED BY WTO

Eco-labels provide consumers with information that a product was made with minimal impacts on the environment. Some governments have argued that eco-label programs may violate WTO rules on product standards. Canada has an excellent program called the "Environmental Choice Program (ECP) which provides the "three doves entwined" eco label to products that meet environmental guidelines. The program was started by Environment Canada and has been privatized and is run by Terrachoice. Visit the Environmental Choice Program at the website http://www.environmentalchoice.com/

There are other eco label programs including Blue Angel in Germany, Dutch Ecolabel in The Netherlands, and Green Seal in the United States. The Green Seal program is the independent, nonprofit organization dedicated to protecting the environment by promoting the manufacture and sale of environmentally responsible consumer products. It sets environmental standards and awards a "Green Seal of Approval" to products that cause less harm to the environment than other similar products. By setting standards for environmentally responsible products, Green Seal seeks to reduce air and water pollution; cut the waste of energy and natural resources; slow ozone depletion and the risk of global warming; prevent toxic contamination; and protect fish and wildlife and their habitats. Visit its website at http://www.greenseal.org/

All of these eco labelling programs could be wiped out or neutralized by WTO challenges from countries that either don't have eco labelling  programs or do have programs that are weaker, and who want to sell their less environmentally sound products into the protected markets..

GREEN PROCUREMENT GUIDELINES BY GOVERNMENTS CAN BE NEUTRALIZED BY WTO

Local, state, provincial and national governments that decide to establish "Green Procurement" guidelines for their departments to purchase environmentally friendly products, and purchase from companies that meet certain environmental management guidelines (such as be certified ISO 14000 compliant), can have their green procurement guidelines struck down by challenges by countries that don't want to meet the environmental requirements.

INHUMANE TRAPPING METHODS BAN STOPPED BY WTO THREAT

Canada, Russia, and the United States have been working hard to stop Europe from implementing a ban of fur from wild animals caught in traps that allow them to live and die a slow and painful death, one of the traps being the infamous leg-hold trap. Europe had announced that it would ban imports of fur from animals caught in these traps, but backed down after the US, Canada, and Russia complained that a ban violated free trade. Under the WTO, fur is fur, regardless of how it was caught.

NAFTA CHAPTER 11 CHALLENGES

An unintended byproduct of the North American Free Trade Agreement (NAFTA) are the trade challenges related to environment protection under Chapter 11 of the Agreement.  For example, Article 1103 states that, 'each Party shall accord to investors of another Party treatment no less favorable than that it accords, in like circumstances, to investors of any other Party or of a non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments."

And Article 1115 under Chapter 11 states that, "Without prejudice to the rights and obligations of the Parties under Chapter Twenty (Institutional Arrangements and Dispute Settlement Procedures), this Section establishes a mechanism for the settlement of investment disputes that assures both equal treatment among investors of the Parties in accordance with the principle of international reciprocity and due process before an impartial tribunal."

ETHYL CORP.'S CHAPTER 11 CHALLENGE FOR COMPENSATION

Ethyl Corporation, a U.S. based company operating in Canada sued Canada for $250 million under the investor-state provision of Chapter 11 of the NAFTA Agreement, as a result of Canada's ban on imports of methylcyclopentadienyl manganese tricarbonyl (MMT). The Canadian Parliament, citing evidence that the gasoline additive posed health risks and clogged vehicles' catalytic converters, had passed legislation, effective June, 1997, banning imports of MMT. Ethyl claimed the ban was an expropriation.   The corporation dropped its suit, however, after the Canadian government, fearing it would lose the NAFTA suit, reversed the ban, wrote a statement declaring there was no evidence MMT posed a health or environmental risk, and paid Ethyl $13 million in damages and legal fees. Source, "Canada Backs Away From US Firm's NAFTA Challenge," Journal of Commerce, July 22, 1998, full article at http://www.harmonizationalert.org/Sept98/naftapcb.htm

Trade in MMT was restricted under the Manganese-based Fuel Additives Act, which went into effect in June, 1997. MMT is a manganese-based gasoline additive manufactured by the Ethyl Corporation of Richmond, Virginia, with a production plant in Sarnia, Ontario.  Airborne manganese has been found to cause disabling neurological impairments in movement and speech, but the public health impacts of the long-term, lower dose exposures resulting from MMT use are unknown. MMT has been in use in Canada for 19 years and Ethyl claims there have been no health risks associated with its use. But no studies on whether MMT causes any health effects have been conducted in Canada.

S.D. MYERS NAFTA CHALLENGE ON CANADA'S BAN OF PCB EXPORTS

On July 22, 1998, S.D. Myers, an Ohio-based company specializing in the clean-up of hazardous wastes, filed a "notice of intent" to seek compensation from the Canadian government under the "Regulatory Taking" compensation provisions of the North American Free Trade Agreement (NAFTA). The company claims that Environment Canada's 15-month ban in 1995 on the export of polychlorinated biphenyls (PCBs) waste cost S.D. Myers $15 million in business it could have had in exporting PCB wastes from Ontario and Quebec to its plant in Ohio for landfilling and processing. It stated that the ban on environmental reasons was tantamount an expropriation of its business. The company filed its claim under the Chapter 11 investor-state arbitration provisions of the NAFTA, which allow a foreign corporation to directly sue a government that takes an action "tantamount to" a direct or indirect expropriation. S.D. Myers is asking for $6.3 million from the Canadian government. For more information contact Elizabeth May, Executive Director, Sierra Club of Canada, 1 Nicholas Street, Suite 412, Ottawa, Ontario, K1N 7B7, ph. (613) 241-4611, website http://www.sierraclub.ca/

CANADA'S METHANEX CORP. USES NAFTA CHAPTER 11 TO CHALLENGE CALIFORNIA'S DECISION TO ELIMINATE MTBE FROM GASOLINE

Vancouver-based Methanex Corp.'s proposed a US $970-million lawsuit against the United States under the investor protection section of Chapter 11 of NAFTA. California recently imposed a ban on the gas additive MTBE, effective in 2002, because MTBE is leaking into the water table and poses health risks to humans. The U.S. Environmental Protection Agency has declared MTBE to be a known animal carcinogen and a probable human carcinogen.

The demand for methyl tertiary butyl ether (MTBE) in California represents some 6.0 percent of world methanol demand. Total world wide production of MTBE represents 30 percent of methanol demand. Methanex Corp. of Alberta, is the world's largest producer of MTBE, a toxic gasoline additive. "The effort to make US taxpayers foot the bill for Methanex's bad luck and bad business strategy is perverse," stated Citizen's Trade Campaign Executive Director Scott Nova.. He asked, "How many Americans knew when NAFTA was enacted that we were inviting corporations to engage in this sort of abuse?" Adding that, "it is duplicitous for Methanex to blame California for falling stock values when the company's profits dropped $270 million between 1997 and 1998 -- before the law was passed and years before the law will go into effect", stated the Citizen's Trade Campaign based in Washington, D.C. It further stated that, "This is just another case of transnational corporations trying to bully democracies into weakening their environmental safeguards," added Wallach. "This is an unconscionable corporate-Canadian shakedown of California's clean water standards. See the full press release by the Citizen Trade Campaign issued June 16, 1999, at website http://lists.essential.org/tw-list/msg00063.html Or call Katie Burnham ph. (202) 546.4611

LACK OF TRANSPARENCY IN THE NAFTA CHAPTER 11 CHALLENGES

One of the problems is that there is a lack of transparency and much secrecy surrounding the NAFTA Chapter 11 challenges and ultimate decisions. The citizens of the countries, whose environmental health will be affected by the decisions are not told what their governments or corporations are doing until its too late. For example, the notice of intent filed by S.D. Myers demonstrates the secrecy clouding such suits. The suit was filed under NAFTA with the Canadian government on July 22, 1998, but was not released to the public until August 21, 1998 almost a month later. Such challenges should be made public immediately, with an opportunity for the citizens to comment. It is this type of secrecy and deal making behind closed doors that the environmental groups now fear are being developed under the WTO.

THE GALLON ENVIRONMENT LETTER
506 Victoria Ave., Montreal, Quebec H3Y 2R5
Ph. (514) 369- 0230, Fax (514) 369- 3282
Email cibe@web.net , Website http://www.gallon.elogik.com
Vol. 3, No. 40, December 1, 1999