WORLD TRADE
ORGANIZATIONTN/TE/6
6 June 2003
(03-2900)
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
1. The sixth meeting of the Committee on Trade and Environment Special Session (CTESS) was
held on 1-2 May 2003.  The report of the meeting is contained in document TN/TE/R/6.
I. STATUS OF WORK
A. PARAGRAPH 31(I)
2. A number of new submissions were circulated  under this item:  documents TN/TE/W/26 from
Japan, TN/TE/W/28 from Hong Kong, China, TN/TE/W/29 from Malaysia, and TN/TE/W/31 from
the European Communities (EC).
3. In general, the meeting was marked by much a greater focus on the specific trade
obligations (STOs) contained in multilateral environmental agreements (MEAs).  While several
delegations shared their experience in the implementation of trade measures contained in MEAs,others shared their understanding of the concep t of STOs.  Both discussions complemented each
other.
4. A large number of delegations continued to argue that STOs had to be measures which were
(1) explicitly provided for in an MEA, (2) oblig atory, and (3) trade-related.  They called for a
step-by-step approach to be followed in the wo rk of the CTESS, whereby the Committee could go
through its work MEA by MEA, analysing the kinds of trade measures that the agreements contained
and identifying those that could be considered STOs.  This could best be done, in their view, throughan additional sharing of Members' experiences in the implementation of MEAs.  One Member
expressed the hope that the "demandeurs" for these negotiations would soon begin to engage in
experience sharing as well.
5. Some warned that if this approach was going to  lead to a listing of those STOs that the WTO
would be willing to consider under the paragraph 31(i) mandate, they would be opposed.  Theyindicated that the outcome of the negotiations ought to be one that would take into account not only
existing STOs, but STOs to be negotiated in future as well.  One of the Members making this point
argued that the outcome should not put into question the necessity of trade measures agreed to in
MEAs – measures which the international community will have deemed indispensable for an
environmental protection objective in another fora.  It argued that the implementation  of those
measures, on the other hand, could continue to be challenged in WTO.  In response, however, many
believed that it was premature to discuss particular "outcomes", with one Member arguing that
waiving the necessity test would constitute a fundamental change in rights and obligations.
6. A discussion took place on how Conference of Parties (COP) decisions should be treated
under the paragraph 31(i) mandate. One delegation argued that COP decisions fell into three broadTN/TE/6
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categories:  (1) decisions introducing amendments to MEAs, (2) decisions aimed at interpreting the
provisions of MEAs, or specifying how they could be implemented, and (3) decisions which were of a
purely political nature.  It argued that category (1) decisions, which were legally binding, certainly
constituted STOs.  However, while category (2) would not always contain legally binding decisions,
and category (3) would never contain any, such decisions by COPs could play an important role ininterpreting MEA provisions and defining the intentions of parties to MEAs.  In response to this
position, a few delegations objected to allowing the legally binding character of COP decisions to
become the principal determinant of whether or not a measure was "set out" in an MEA, according to
the terms of the paragraph 31(i) mandate.  A number of other delegations stated either that it was
premature to be examining COP decisions, or that th ey needed more time to reflect on their treatment
under the mandate.
7. One Member proposed that the "degree of discretion" given to MEA parties in taking a trade
measure had to be placed at the center of the debate.  It believed that trade measures in MEAs fell into
four broad categories:  (1) those that obligated parties to take particular measures, (2) those that gave
them discretion in when to trigger a trade measure, (3) those that gave them discretion on the
modalities to be used to achieve a particular objective, and (4) those that were the outcome of
decisions by the "deliberating organ" of an MEA.  It argued that category (1) measures were STOswhich had to be deemed compatible with WTO rules; that category (2) measures were STOs that
could be rebuttably presumed to be compatible with the rules if certain conditions were met; and that
categories (3) and (4) fell outside the mandate but could be looked at on a case-by-case basis.  Also
commenting on the "degree of discretion," one Member argued that if MEAs provided their parties in
certain instances with discretion with respect to the measure they take to implement the objective ofan MEA, it was important for the WTO not to erode that discretion through these negotiations.
Another Member argued that it was premature to exclude measures from the mandate based on the
"degree of discretion" principle.  A number of other Members contended that the concept of
"discretion" provided too loose a framework for the identification of STOs.
8. One of the definitions that emerged during the course of the discussion of the term STO, was
that an STO should be "any measure that modifies the conditions of trade flow or of competition
between substitutable products" (a measure addressing or regulating the carbon-content of products
was given as an example).
9. With respect to how to proceed in future, one Member argued that the six MEAs on which
some Members had begun to focus were likely to be the only ones to contain STOs.
1  All other
agreements were either (1) not multilateral, (2) did not have environmental protection as their main
objective, or (3) did not contain STOs.  It called for continued focus on those six.  Several participantssuggested that of those six, the three that have entered into force should be taken as a starting-point
for future discussions.  However, one Member responded that it was time that Members ceased
discussions on which approach to follow, an MEA-by-MEA analytical approach, or the
conceptual/definitional approach.  It argued that an examination of individual MEAs did not have to
preclude a parallel discussion on conceptual issues, and contended that all submissions made to datewere based on a mixture of approaches.  No de cision was taken on this matter, and I sincerely hope
that Members will continue to build on the constructive mix of ideas put forward to date.
                                                     
1 The six MEAs are:  the Convention on International Trade in Endangered Species of Wild Fauna and
Flora (CITES), the Montreal Protocol on Substances that Deplete the Ozone Layer (Montreal Protocol), theBasel Convention on the Control of Transboundar y Movements of Hazardous Wastes and their Disposal
(Basel Convention), the Rotterdam Convention on the Pr ior Informed Consent Procedure for Certain Hazardous
Chemicals and Pesticides in International Trade (Rotterdam Convention), the Stockholm Convention on
Persistent Organic Pollutants (Stockholm Convention), and the Biosafety Protocol.TN/TE/6
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10. For the first time, the CTESS extended invitations on an ad hoc basis to the United Nations
Environment Programme (UNEP) and six MEAs.2 The ad hoc invitees attended paragraph 31(i)
discussions.  Some questions were addressed by participants to the MEAs, particularly with regard to
decision-making under their respective agreements.  A constructive exchange of ideas took place, and
a number of Members, as well as the ad hoc invitees, expressed the hope that this form of cooperationwould be continued.  The UNEP and MEA representatives stated that they stood ready for further
cooperation.
B. PARAGRAPH 31(II)
11. A new paper by Switzerland on paragraph 31(ii) was circulated in document TN/TE/W/30.
Information Exchange
12. Numerous suggestions have been made by Members on how to enhance procedures for
information exchange.  They include:  (1) form alizing Information Sessions with MEAs and
organizing them on a regular basis;  (2) holding Information Sessions on specific themes by grouping
the MEAs that share common interests;  (3) having other WTO committees organize meetings with
MEAs, either with the CTE or separately; (4) creating avenues for information exchange between
government representatives from the trade and environment sides; (5) having the WTO secretariat
organize parallel activities at MEAs' COPs more systematically;  and (6) establishing an electronicdatabase on trade and environment.  At the meeting, divergent views were expressed on the need to
institutionalize existing practices for information exchange, such as the MEA Information Sessions.
Some delegations noted that a certain degree of flexibility should be maintained.
Observer Status
13. On criteria for the granting of observer status, some references were made to the criteria
set out in Annex 3 of the Rules of Procedure for Sessions of the Ministerial Conference and Meetings
of the General Council
3, such as the direct interest of the international organization requesting
observer status, the reciprocal treatment for WTO observership, and the consideration of the requests
on a case-by-case basis.  However, further discussion on the criteria for the granting of observer status
is required, in addition to the identification of the WTO bodies that could have interest in wideningtheir reach to MEAs and UNEP.
14. One Member proposed that the CTESS recommend that Ministers in Cancún consolidate the
ad hoc invitations extended to various MEAs and UNEP in the course of the CTESS' work.  However,
no consensus was reached on this recommendation.
C. PARAGRAPH 31(III)
15. The Special Session examined a new document submitted under this item by Qatar
(TN/TE/W/27), which complemented a previous submission by this delegation.4  Members' attention
was also drawn to the work conducted by the Organization for Economic Cooperation and
Development (OECD) on environmental goods.
16. The Special Session continued its discussion of the definition and identification of
environmental goods within the meaning of paragraph 31(iii).  Some delegations expressed support
                                                     
2 These MEAs are: the Basel Convention, CITES, th e Montreal Protocol, the Convention on Biological
Diversity (CBD), the International Tropical Timber Organization (ITTO) and the United Nations FrameworkConvention on Climate Change (UNFCCC).
3 WT/L/161, 25 July 1996.
4 TN/TE/W/19 and Corr.1.TN/TE/6
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for the use of the APEC list as a starting-point for th e discussion.  In this respect, it was recalled that
the APEC list had been originally intended to serve as a basis for tariff liberalization.  However, it
was also argued that a "WTO list" ought to be drawn up in light of the Doha mandate.  Some
Members emphasized the importance of incorporating in a list of environmental goods products of
export interest to developing countries.  In this context, the question was raised as to whether a list ofenvironmental goods ought to include agricultural products.  With regard to the identification of
environmental goods, some delegations reiterated their preference for criteria based on the product's
end-use, rather than on process and production methods (PPMs).
II-III OUTSTANDING ISSUES AND  FUTURE WORK
17. Informal consultations of the CTESS were held on 22 May 2003 and it was agreed that
I would prepare a report on my own responsibility to the TNC meeting of 14 July, in which I would
provide an update on the progress achieved in the negotiations.  The report would be brief and factualand would be circulated to Members before the next CTESS meeting on 8 July.  It was also agreed
that ad hoc invitations to that meeting would be extended to UNEP, as well as the same six MEAs
previously invited by the Committee.
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