WORLD TRADE
ORGANIZATIONTN/TE/7
10 July 2003
(03-3728)
Committee on Trade and Environment
Special Session
REPORT BY THE CHAIRPERSON OF THE SPECIAL SESSION OF
THE COMMITTEE ON TRADE AND ENVIRONMENT
TO THE TRADE NEGOTIATIONS COMMITTEE
TRADE AND ENVIRONMENT NEGOTIATIONS:  STATE OF PLAY
1. The purpose of this report is to provide the Trade Negotiations Committee (TNC), at its
meeting of 14 July 2003, with an overview of the progress achieved in the trade and environmentnegotiations in preparation for the Cancun Ministerial Conference.
2. Delegations have actively engaged in the negotiations, formulating constructive proposals that
have given orientation to the work of the Committee on Trade and Environment Special Session
(CTESS).  The Committee has made significant progress on certain aspects of the mandate given to it
by Ministers at the Doha Ministerial Conference.
I. PARAGRAPH 31 (I)
3. In Paragraph 31 (i), participants were instructed to negotiate on "the relationship between
existing WTO rules and specific trade obligations set out in multilateral environmental agreements
(MEAs).  The negotiations shall be limited in scope to the applicability of such existing WTO rules as
among parties to the MEA in question.  The negotiations shall not prejudice the WTO rights of anyMember that is not a party to the MEA in question."
4. Since the launching of the negotiations, delegations have actively engaged in developing a
common understanding of the mandate.  That understanding has evolved on the basis of two
complementary approaches:  the identification of specific trade obligations (STOs) in MEAs;  and a
more conceptual discussion on the WTO-MEA relationship.  Delegations have examined the different
components of the mandate, such as the terms "existing WTO rules," "STOs," "set out in MEAs,"
"MEAs," and "among parties to the MEA in question."  A few of the submissions made have alsobegun to look ahead at the possible outcomes that the mandate could deliver.
5. On the different components of the mandate, the bulk of the discussion has revolved around
the terms "MEAs," "STOs," and the notion of measures  being "set out in MEAs."  On "MEAs," while
some believe that there is a need to define the concept so as not to overstep the boundaries of the
mandate, others do not view this as necessary.  Some focus was placed on six MEAs that couldcontain  STOs.  However, delegations have not agreed to limiting  the discussion to any particular
number of MEAs.
6. On "STOs," several delegations believe that these must be measures that are explicitly
provided for and mandatory under MEAs.  However, discussion is still taking place on other kinds of
trade measures contained in MEAs and whether they can be considered STOs.  Furthermore, somedelegations are arguing that the entire operational framework of MEAs needs to be looked at in
identifying the STOs that are "set out in MEAs," suggesting that Conference of Parties (COP)
decisions must be addressed.  The various forms that COP decisions can take, and their legal status, is
being discussed.TN/TE/7
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7. Some suggestions were made in a few of the submissions on the potential outcomes of the
negotiations, such as the need to develop certain "principles and parameters" to govern the WTO-
MEA relationship, and to establish the conformity of certain kinds of trade measures in MEAs with
WTO rules. However, there seemed to be a general sense in the CTESS that it was premature to
discuss potential results.
8. It seems clear that the various components of the mandate discussed to date, some of which
may merit further discussion, will need to be drawn together at some stage to address "the
relationship between existing WTO rules and specific trade obligations set out in MEAs." It also
seems clear that greater national coordination between trade and environment officials can itself
contribute to a more mutually supportive trade and environment relationship.
II. PARAGRAPH 31 (II)
9. The mandate of Paragraph 31 (ii) stipulates that participants negotiate "procedures for regular
information exchange between MEA Secretariats and the relevant WTO committees, and the criteria
for the granting of observer status."   The mandate involves two components;  one, the issue of
regular information exchange;  and, two, that of the criteria for the granting of observer status. Several
delegations have also pointed out that negotiations under this paragraph can have a positive spillover
on Paragraph 31 (i), in terms of reducing the risk of conflict between the WTO and MEAs.
10. On this paragraph, the CTESS held an MEA Information Exchange Session with six MEAs
and the United Nations Environment Programme  (UNEP) on 12 November 2002, in which a useful
exchange of ideas took place.  A number of suggestions were made by UNEP and the MEAs on how
to enhance cooperation and information exchange between the WTO and their respective
organizations, as well as on how to address the issue of observer status.
Information Exchange
11. With respect to information exchange, delega tions are in agreement that existing forms of
cooperation and information exchange between the WTO, MEAs and UNEP have proven to be
valuable and should be enhanced.  Reference was made to UNEP's efforts to organize meetings back-
to-back with those of the CTESS.  Such meetings  have provided a valuable forum for information
exchange, and have allowed numerous capital-based environment officials to attend the CTE Regular
and its Special Session.
12. Progress in the CTESS was made in identifying the forms that enhanced cooperation and
information exchange could take.  The following suggestions were made:
- Formalizing MEA Information Sessions in the CTE, and organizing them on a regular
basis;
- Holding MEA Information Sessions on specific themes by grouping the MEAs that share
a common interest;
- Organizing meetings with MEAs in other WTO bodies, either together with the CTE or
separately;
- Organizing WTO parallel events at the COPs of MEAs more systematically;
- Organizing joint WTO, UNEP and MEA technical assistance and capacity building
projects;
- Promoting the exchange of documents, while respecting confidential information;
- Creating avenues for information exchange between government representatives from the
trade and environment sides;  and
- Establishing an electronic database on trade and environment.TN/TE/7
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13. However, a number of delegations have highlighted that it is important to maintain flexibility
in information exchange, stressing the financial and human resource constraints of the WTO and
MEAs, and of smaller delegations. Other delegations argued that it was necessary to identify the
WTO Committees that could benefit from wide ning their contacts with UNEP and MEAs.
Observer Status14. On observer status, while several delegations have argued that the outcome of the
General Council and TNC deliberations on this matter must be awaited, others have stated that
discussions in the CTESS were required in light of the Committee's mandate.  They have added that
such discussions could provide direction and impetus to the horizontal discussions taking place.
15. Several delegations expressed the view that the observer status issue needs to be resolved as
expeditiously as possible. Delegations took note of the pending requests for observership by UNEP
and MEAs in various WTO bodies.  Reference has been made in the discussions to the criteria setforth in Annex 3 of the Rules of Procedure for Sessions of the Ministerial Conference and Meetings of
the General Council (WT/L/161), with some delegati ons suggesting that there is a need to build on
them.  Further work will be required on the criteria to be used, and the WTO bodies concerned by this
mandate.
III. PARAGRAPH 31(III)
16. In Paragraph 31 (iii), participants were instructed to negotiate on "the reduction or, as
appropriate, elimination of tariff and non-tariff barriers to environmental goods and services."
Delegations supported the idea that the negotiations on environmental goods and services be
conducted in the Negotiating Group on Market Access for Non-Agricultural Products and the Council
for Trade in Services Special Session. However, some participants called on the CTE Special Sessionto clarify the concept of environmental goods.  The Chairs of the three negotiating bodies concerned
by this mandate have agreed to coordinate on the progress made in their different Committees on a
regular basis.
17. In discussing the concept of environmental goods, several references were made to the
Organization for Economic Cooperation and Devel opment (OECD) and the Asia Pacific Economic
Cooperation forum (APEC) lists of such goods.  However, some delegations argued that a "WTO list"
needed to be developed.  Other delegations felt that the interests of developing countries in these
negotiations needed to be taken into account.  The question of the inclusion of agricultural goods was
also raised. Various criteria for the definition or identification of environmental goods were debated,
and a few delegations advanced lists of products that they wanted considered as environmental goods,
including for example in the energy domain.
IV. OTHER ISSUES
18. The CTESS has invited, on an ad hoc basis, six MEAs and UNEP at its meetings of 1-2 May
and 8 July 2003.  Through this form of cooperation, the CTESS has benefitted from an enriching
exchange of ideas with MEA Secretariats and UNEP.  Delegations and the ad hoc invitees expressed
the hope that this cooperation would be continued.
19. Several delegations have raised the issue of technical assistance in the negotiating context,
and in particular the possibility of financing the participation of delegates from developing countries
in CTESS meetings.  Delegations were invited to  continue to reflect on their future technical
assistance needs.
20. By way of a recommendation for the Cancun Ministerial Conference, one delegation
proposed that Ministers be asked to invite UNEP a nd those MEAs identified in the Matrix preparedTN/TE/7
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by the WTO Secretariat (WT/CTE/W/160/Rev.2) to observe the work of the CTESS, and to endorse
the MEA Information Sessions held in the CTE so they may be held at least once a year.  The
proposal contained in document JOB(03)/116 wa s discussed at the 8 July 2003 meeting of the
CTESS, but no consensus was reached on forwarding it to the Ministerial Conference.
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