Posts Tagged European union
After leaks, the Panel’s ruling in EU Seals is finally out. As it was only released this afternoon, I have not as yet had time to read it thoroughly. However diagonal reading reveals that by and large the regime was found to qualify for the public morals exception under the GATT Agreement (and not to be more trade restrictive than necessary to protect same under the TBT Agreement) however the pro Inuit exceptions have proven to be the Regulation’s Achiless heel. As I have suggested in the past in other areas, this may well mean that the EU has no choice but to resort to stricter rules, leaving out the exceptions.
Further analysis and post later in the week hopefully.
Is something fishy in the State of Denmark? Faroe Islands WTO and UNCLOS litigation provides a honey pot to trade and EU lawyers
Yummie. That’s how Trade lawyers and EU lawyers receive news of the Danish request for consultations with the EU, over at the WTO, on behalf of the Faroe Islands. A separate action is underway with UNCLOS (although the docket there shows no sign as yet of the case). Disagreement over herring stock lies at the root of the offending EU Regulation, with sanctions imposed by the EU disallowing Faroese fishermen to land mackerel or herring in EU harbours or export such fish to the EU.
The EU justify their action on stock conservation grounds, thus bringing GATT Article XX into play. Action at the WTO is exciting both because it joins a growing list of actions related to domestic regulatory authority, and because it is unheard of for one EU Member to take another to the WTO (Faroe’s specific status under EU law explains this, however even in EU law this terrain is quite uncharted).
As sources at the WTO say: ‘it’s a really interesting case’: that quote must be in the running for understatement of the year. Sources at the EU suggest no one had expected Denmark’s WTO filing to actually materialise.
It has been reported that the challenge to the French moratorium on shale gas exploration, by US firm Schuepbach Energy, has been referred to the Constitutional Court. Schuepbach had initially challenged the freezing effect of the 2011 ban on the permits which the firm had been granted erlier in 2011, before the lower administrative court at Cergy Pontoise. This court referred for judicial review to the Conseil d’Etat, which now has passed the file on to the Constitutional Court.
I have difficulty getting hold of the official court documents. Reports suggest that the challenge is based on Articles 16 and 17 of the French Déclaration des droits de l’homme et du citoyen, dealing cq with the separation of powers and the right to property.
The French challenge comes amidst the imminent publication of the report commissioned by the European Commission into the suitability, or not, of the current legal framework in the EU and the Member States for regulating shale gas. A little bird tells me (ok, it’s a PhD student of mine, Leonie Reins, who co-authored the report) that the report will be published just after the summer.
In a related, more technical but not therefore less effective manner, Poland’s roll-out of fracking licences arguably received considerable setback following the ECJ’s end of June ruling in Case C-569/10, Commission v Poland: the court held that Poland should have put the licences out to open tender, in accordance with Directive 94/22 on hydrocarbons exploration. The case does not concern fracking licences alone, and the impact on licences that have already been issued is uncertain (although surely these licences cannot be held to be entirely kosher and free of challenge by competitors or NGOs, following the judgment).
Watch this space. I need not tell you that fracking is very controversial in the EU. See in particular this tour d’horizon /overview of contentious issues by Kathleen Garnett over at EU perspectives.
How ‘trade related’ is the Agreement on Trade-Related Aspects of Intellectual Property Rights? The ECJ in Daiichi Sankyo v Demo
In Daiichi Sankyo v Demo (most likely ‘Demo’ in shorthand), the Court of Justice held last Thursday, 18 July. One of the main issues was the extent of Article 207 TFEU on the EU’s common commercial policy, vis-a-vis the TRIPS Agreement. Article 207 grants the EU exclusive competence (and the European Commission a very strong hand) in ‘common commercial policy’.
By its first question, the referring Greek court asked essentially whether Article 27 of the TRIPs Agreement falls within a field for which the Member States have primary competence and, if so, whether the national courts may accord that provision direct effect subject to the conditions laid down by national law. The TRIPs Agreement was concluded by the Community and its Member States by virtue of shared competence. At the time, for the EU to be able to exercise exclusive jurisdiction pre Lisbon, under the in foro interno, in foro externo principle, it would have had to have exercised its powers in the field of patents, or, more precisely, of patentability: roll-out of its internal powers on patentability, would have als led to exclusive power externally. The European Commission however suggested that the mixed agreement discussion (and the exercise, or not, of its internal powers), was no longer relevant, given that the Lisbon Treaty has now given it exclusive competence in the entire common commercial policy, including for intellectual property rights. Under the old Article 113 EC Treaty (later updated to Article 133 – many of us still speak of the ‘Article 113 Committee, which surely dates us!), intellectual property rights did not feature in the common commercial policy.
The ECJ conceded that of the rules adopted by the European Union in the field of intellectual property, only those with a specific link to international trade are capable of falling within the concept of ‘commercial aspects of intellectual property’ in Article 207(1) TFEU and hence the field of the common commercial policy. However it emphatically [and contrary to the view of Cruz Villalon AG] held that such is indeed the case for the TRIPS Agreement: ‘Although those rules do not relate to the details, as regards customs or otherwise, of operations of international trade as such, they have a specific link with international trade. The TRIPs Agreement is an integral part of the WTO system and is one of the principal multilateral agreements on which that system is based.’ (para 53).
Member States cannot therefore grant direct effect to the provisions of TRIPS, in accordance with national law. It is up to the ECJ to hold on such direct effect – or not, and in the absence of such direct effect, to interpret the provisions of EU law in line with the provisions of the TRIPS Agreement.
The judgment also reviews a number of substantial aspects of intellectual property law which I feel less entitled to comment on, I fear.
Argentina has requested consultations, the first step in the WTO’s dispute settlement procedure, with respect to the EU’s biofuels sustainability criteria, contained in RED, its renewable energy Directive. The development of biofuels criteria per se is full of pitfalls. For starters, the EU’s Directive has effectively skirted the issue of sustainability. As all students of environmental law and policy have been told ad nauseam, sustainable development has three pillars (ecological, economic, social), not just the one (ecological /environment) which the Directive has quantified. On social and economic impact of the EU’s regime, the European Commission is merely to report. Evidently, quantifying all three is not straightforward: witness also the demise of the Clean Development Mechanism, CDM, one of the flexible mechanisms under the Kyoto Protocol to the United Nations Framework Convention on Climate Change.
With respect to the environmental pillar, RED employs a standard value of CO2 emission reduction which for soybean biodiesel (the main export of Argentinian biofuel) is 31%. This falls short of the 35% required for renewable energy to count towards Member States’ renewable energy targets (and co-inciding fiscal and other incentives). In other words, fuel not meeting the standard can still be imported into the EU: but it will not be very popular (one can sense a de facto /de iure discrimination debate). One way of getting around the issue, is for individual shipments to show that they meet the 35% threshold with all the extra costs this implies (arguably imposing a measure equivalent to a quantitative restriction), or for the European Commission to recognise relevant voluntary schemes meeting the higher threshold through certification. An Argentinian scheme presented to the EC was not accepted by it.
The Argentinian request includes a long list of GATT and WTO obligations which it argues are infringed by the EU (and by relevant Member States implementing measures).
Having a Panel and Appellate Body express some rules of thumb for sustainability criteria (which Argentina explicitly says it does support in principle) would be very useful indeed.