. /.   WORLD TRADE  
ORGANIZATION  TN/TE/W/67 
13 June 2006 
 (06-2838) 
Committee on Trade and Environment Special Session Original:   English 
  
 
ENVIRONMENTAL PROJECT APPROACH – COMPATIBILITY AND CRITERIA 
 
Submission by India
 
 
Paragraph 31 (iii)  
 
 
 The following communication, dated 12 June 2006,  is being circulated at the request of the 
Delegation of India.  
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 1. The Environmental Project Approach (EPA ) fully responds to the objectives of 
Paragraph 31(iii) of the Doha Ministerial Declara tion, which seeks to eliminate tariff and non-tariff 
barriers to trade in environmental goods and services.  It responds to the objectives in a much more 
effective and comprehensive manner by adopting an integrated approach to the mandate unlike the 
“list approach”.  The “list approach” is limited to  tariff reduction in goods only, and does not address 
the explicit mandate to include environmental servi ces;  it does not address in any manner the issues 
relating to non-tariff barriers, and comes with the added baggage of being st atic, needing repeated 
negotiations and implementation problems due to classification issues.  
2. A project-based or sector-specific approach is not new to the WTO.  Negotiations during the 
Uruguay Round addressed specific sector issues, namely  in the field of chemicals and pharmaceutical 
products, medical equipments, and information tec hnology.  Recently, the Doha Declaration on the 
TRIPS Agreement and Public Health is another su ch negotiation which focused on finding solutions 
to the public health issues relating to diseases, namely HIV/AIDS, tuberculosis, malaria and other 
epidemics.  The WTO thus provides a regulatory framework to find common solution (like 
elimination of tariffs) or creates necessary policy space for the Member countries to address the 
problems unilaterally (such as, by recourse to compulsory licensing of patented drugs).  These examples show that Members have been able to address sector specific objectives within the general 
WTO regulatory framework.  The EPA, therefore, is not an exception;  rather it is in line with the 
general structure of the multilateral trading system , providing appropriate answer to address specific 
environmental problems of the Member countries. 
3. It has been argued that EPA does not provide pr edictability or transparency.  In fact, the 
underlying philosophy of the EPA proposal does address these objectives.  EPA will multilaterally 
define policy space for Member countries for tacklin g and addressing their environmental problems in 
a manner which is efficient and commensurate with  their needs and levels of development.  
EPA defines the WTO framework within which Members will undertake and implement specific 
projects.  It seeks to define the boundaries and pa rameters by which privileged market access can be 
granted for the products for the e nvironmental projects.  EPA will al so include the parameters under 
which such projects can be undertaken as well as the criteria that would be applied by any Designated 
National Authority (DNA) to determine whether a pr oposed environmental project qualifies for tariff 
concessions on environmental goods and services . TN/TE/W/67 
Page 2  
 
  4. Questions have been raised about the lack of  novelty or additionality offered by the EPA as 
Members unilaterally undertake and implement environmental projects.  Unilateral action by 
Members does not assure privileged tariff access to other Members.  The importance and value of creating an appropriate legal framework in the WT O needs to be recognised in this context.  
Agreement in CTESS on definitions and criteria of environmental projects would create predictability 
and legal security to this arrange ment.  It would not only be able  to address global environmental 
objectives but would also be able to address the i ndividual national environm ental goals thus being 
need-based and objective-oriented.  Since the a dopted global projects would be as per the CTESS 
agreement, domestic implementation of the framework  would be subject to dispute settlement, as in 
other areas of the WTO law.  Administrative d ecisions taken can be reviewed along the lines of 
reviewing determinations of anti-dumping and countervailing measures under the WTO Agreements 
by the dispute panels and the Appellate Body.  This would enable traders to assess conditions for 
participation and market access.  All these legal commitments enhance legal security of the EPA.   
5. It must also be noted that environmenta l goods are in any case included in the product 
coverage of the ongoing tariff negotiations – both  NAMA and agriculture, EPA does offer additional 
binding tariff concessions.  The CTESS would agree on the appropriate criteria, definition, and types 
of environmental projects.  Goods imported for th e projects would be eligible for appropriate tariff 
concessions.  This certainly provid es predictability to the exporting countries.  Member countries 
implementing such environmental projects would th erefore guarantee additional market access on the 
agreed terms for the duration of the project, whic h cannot be withdrawn during the period of the 
project.  This binding would also be available for spare parts for the equipment or goods used in the 
project.  This temporal binding of commitments unde r the auspices of the WTO would be an element 
of multilateralism.  Regarding scheduling of Member s’ commitments under this approach, the format 
can be finalized by taking into consideration the different kinds of schedules used in the WTO under 
different types of agreements, such as th e GATT schedules, the GATS schedules, the GPA 
schedules, etc.  
6. The EPA does not conflict with MFN principles of GATT.  Specific products would obtain 
privileged market access without reference to the origin  of the product.  Such preferential access is not 
granted on the basis of the products originating in a particular Member country, as in the case of FTAs 
or Customs Unions, but because it complies with th e requirements of the EPA.  Products from all 
Members will equally qualify to compete for the project.  The EPA adheres to the MFN principle better than several practices presently followed by  Members such as country specific tariff rate 
quotas, whereby the same product receives different tariff treatment depending on its origin and on 
the quantity of imports.  In any case, Members are entitled to rely upon the criteria relating to the 
end-uses of products in a given market, to that extent a product used for a specific environmental 
purpose could be distinguished from the same products  used for a different purpose (reference can be 
made to the Border Tax Adjustment Report of the Working Party, adopted on 2 December 1970, 
BISD 18/S (1972) Para 18). 
7. The EPA is in line with the overall goal and working of the WTO to achieve sustainable 
development and to bring synergy between trade and environment.  The role of the Designated 
National Authority can be built in a manner so as to  provide transparency and access to project-related 
information.  Other legal concerns (if any) can always be taken into account while negotiating an 
appropriate framework and agreement.   
 
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