RESTRICTED  WORLD TRADE  
ORGANIZATION  TN/TE/R/11 
30 May 2005 
 
 (05-2181) 
Committee on Trade and Environment 
Special Session  
 
 
 
SUMMARY REPORT ON THE ELEVENTH MEETING OF THE COMMITTEE 
ON TRADE AND ENVIRONMENT IN SPECIAL SESSION 
 
24-25 FEBRUARY 2005 
 
Note by the Secretariat  
  1. The Committee on Trade and Environment in Special Session (CTESS) held its eleventh 
meeting on 24-25 February 2005 on the basis of the agenda set out in the convening airgram, 
WTO/AIR/2481. 
I. PARAGRAPH 31 (I) - WTO RULES AND SPECIFIC TRADE OBLIGATIONS IN 
MEAS
1 
2. The representative of Canada  welcomed the submission of Members' national experiences on 
the negotiation and implementation of specific trade obligations (STOs) in Multilateral Environmental 
Agreements (MEAs).  The submissions illustrated how national coordination could be undertaken in 
practice, as well as its key role in achieving mutu ally supportive trade and environmental outcomes. 
Canada described its own internal coordination mech anism, and the "principles and criteria approach" 
that it applied to the formulation of its national position in MEAs. 
3. For Canada, coordination of trade and the environmental policies among federal 
governmental departments had been an established pr actice for a number of years.  Coordination had 
been complemented by consultations with civil society, non-governmental organizations (NGOs), the business community and provincial and territorial go vernments.  In preparing their position for MEA 
negotiations, lead departments actively engaged in discussions with all other interested departments. Interdepartmental meetings were organized in adva nce of each MEA negotiation, especially when trade 
measures were being considered.  These offered the opportunity for a ll participants to contribute to 
decision-making, to identify common ground, and to e liminate, or at least re duce, their di fferences. 
External sectoral advisory groups on international trade were also consulted. The Canadian Government undertook consultations with environmen tal NGOs at key stages of MEA 
negotiations, in addition to obtaining input from the general public through its  Trade Negotiations and 
Agreements web site.
2 
4. With regard to applying a "principles and criteria approach"  to the negotiation of MEAs, 
Canada had advocated this approach in the CTE in 1996 (WT/CTE/M/10).  It had argued that the 
principles could assist the WTO dispute settlement body in adjudicating cases involving MEA trade measures, and that the criteria could guide MEA negotiators when considering the use of trade 
measures in their MEAs.  
                                                     
 
1 Document TN/TE/S/5/Rev.1, entitled Matrix on Trade Measures Pursuant to Selected MEAs , was 
circulated at the meeting. 
2 www.dfait-maeci.gc.ca/tna-nac/menu-en.asp.  TN/TE/R/11 
Page 2  
 
5. The principles  included:  that the MEAs be open to all countries;  that they reflect broad-
based support;  that provisions specifically author izing trade measures be drafted as precisely as 
possible;  that trade with non-parties be permitted on the same basis as with Parties if the non-parties 
provided equivalent environmental protection;  and lastly, that the MEAs have explicitly considered 
WTO rules for the use of trade me asures in their agreements.   
6. The criteria  to be considered by MEA negotiators included:  that trade measures be chosen 
only when effective, and when alternative measure s were ineffective in achieving the environmental 
objective;  that trade measures not be more trade-restrictive than necessary to achieve an 
environmental objective;  and that trade meas ures not constitute arbitrary or unjustifiable 
discrimination. 
7. Consideration of these "principles and criteria"  in the development of Canada's national 
position in MEA negotiations was usually implicit rath er than formally articulated.  It provided a 
highly effective framework for achieving mutually supportive environmental and trade policies, and 
for coherence in the application of relevant international agreements. 
8. Using three recently negotiated MEAs – the Cart agena Protocol on Biosafety, the Rotterdam 
and the Stockholm Conventions – Ca nada demonstrated how the different criteria worked.  With 
respect to the Biosafety Protocol, the "effectiveness"  criterion had been applied in its provisions on 
the prompt posting of information in the Biosafety Cl earing House.  That information pertained to the 
final decisions taken on the domestic use of Livi ng Modified Organisms (LMOs) intended for food, 
feed and processing (FFP) that were subject to transboundary movement.  Parties needed this 
information well in advance in order to initia te their domestic decision-making processes for LMO 
commodities such as canola, corn and soy beans. 
9. Some countries in the negotiation had sought to have LMOs for FFP subjected to the Advance 
Informed Agreement (AIA) mechanism.  Canada  and other countries which exported agricultural 
commodities had found such an obligation to be exc essive, and it had ultimately been set aside - in 
Canada's view, because it did not meet the criterion of "effectiveness."  Canada had argued that LMOs 
for FFP were not intentionally introduced into the e nvironment, and that they could be subjected to 
different obligations under the Protocol – obligations  which would be equally effective in terms of 
meeting the Protocol's objectives. 
10. One of these obligations was the above-m entioned provision on the prompt posting of 
information.  Another was the article of the Pr otocol on "Handling, Transport, Packaging and 
Identification."  It required that documentation accompanying LMOs intended for FFP clearly identify 
that they may contain LMOs and indicate that they were not intended for inte ntional introduction into 
the environment.  In Canada's opinion, this oblig ation, combined with an undertaking to take a 
decision on detailed requirements for this purpose with in two years after the entry into force of the 
Protocol, responded to the criterion th at an obligation "not be more tr ade restrictive than necessary" to 
achieve an environmental objective.  Parties were able  to use the "may contain" information to ensure, 
via appropriate measures, that the contents of ship ments would not be released into the environment. 
11. The second example that Canada cited was that  of the Stockholm Convention, which was an 
example of how the criterion "that trade meas ures not constitute arbitrary or unjustifiable 
discrimination" could be applied.  The primary objective of the Convention was to protect human 
health and the environment from persistent orga nic pollutants (POPs) which were defined under 
Article 8 of the Convention.  The Convention includ ed provisions on the elimination or restriction of 
production and use of certain POPs employed for specific purposes, for example, of DDT in the 
campaign against malaria. 
12. The initial agreed list of chemicals and pestic ides that constituted POPs had reflected a 
consensus on the threat to human health and the e nvironment that certain substances posed.  It had  TN/TE/R/11 
 Page 3 
 
 
facilitated Parties' agreement on the chemicals and products that needed to be eliminated and, 
therefore, subjected to trade restrictions.  Arb itrary or discriminatory decision-making was avoided 
through an agreement to first implement measures to reduce or eliminate releases from intentional 
production and use of POPs;  and second, measures to  reduce or eliminate releases from unintentional 
production of POPs;  and third, me asures to reduce or eliminate releases from stockpiles and wastes. 
13. The third example given by Canada was that of  the Rotterdam Convention.  It ensured that 
importing Parties could take decisions that were "least  trade restrictive".  The primary objective of the 
Convention was to promote shared responsibility and cooperative efforts in the international trade of 
certain hazardous chemicals, in order to protect  human health and the environment from potential 
harm.  The Convention was also intended to contribute to their environmentally sound use, by 
facilitating information exchange on their character istics;  providing for a national decision-making 
process on their import and export;  and disseminating these decisions to the Parties.  Based on the information provided to importers, decisions could then be made on whether or not to consent to  
import, or to provide consent subject to certain co nditions.  Within this range, less trade restrictive 
options would always be available to Parties. 
14. The criterion that "trade measures not constitute arbitrary or unjustifiable discrimination" was 
also ensured by the prior informed consent (PIC) pr ocedure.  The export of chemicals and pesticides 
that were subject to the PIC procedure would not be allowed unless the country of import had provided its "prior informed consent" regarding the receipt of the shipment of chemicals.  Importing 
countries would be notified when potential candidat es for the PIC procedure (products subject to 
regulatory action in the exporting country) were expor ted.  Import restrictions taken pursuant to the 
Convention needed to be trade neutral and, thus, to prevent the use of the PIC regime to protect 
domestic products.   
15. Under the Convention, it was also necessary fo r bans or restrictions on imports of PIC 
chemicals to be accompanied by parallel bans or restrictions on production fo r domestic use, either 
through final decisions pursuant to legislative or administrative measures, or  through the issuance of 
interim responses on the import of the chemical or p esticide.  Once consent had been granted, it was 
necessary for adequate safety information to  accompany shipments of the products.   
16. In conclusion, Canada believed that using basi c agreed criteria could assist in ensuring that 
mutually supportive trade and environmental out comes were reached in MEA negotiations, and 
provided a useful framework for any dispute settlement  deliberation related to an MEA trade measure.  
However, this approach was limited in how far it could assist in clarifying the relationship between 
STOs and existing WTO rules, in that issues of WTO consistency were more likely to arise at the 
level of the domestic implementation and interpre tation of STOs, even when MEA provisions and 
WTO rules were, apparently, mutually supportive.   
17. The representative of Australia
 welcomed the intervention from Canada and the national 
experience-sharing exercise.  In Australia's submission to the CTESS' previous meeting 
(TN/TE/W/45), Australia had concluded that the relationship between trade and environmental 
obligations was working well.  No  evidence to the contrary had been tabled to the Committee.  
Instead, the demandeurs in this area referred to "p roblems that could arise in future" without any 
elaboration, in specific terms within the mandate, of what these problems might be. 
18. Specific messages on how to ensure the mutual  supportiveness of trade and the environment 
could be drawn from the material that Australia  and other Members had offered on their national 
experiences through submissions and in oral interven tions to the Committee.  A number of key points 
had emerged from these contributions, such as th e importance of national-level coordination, 
communication, transparency and accountability, a nd of international-le vel, science-based, 
participatory approaches to decision-making.  Aust ralia believed that more could be achieved in 
future CTESS meetings, particularly if the Commi ttee managed to hear a representative spread of TN/TE/R/11 
Page 4  
 
Members willing to come forward with their own ex periences, especially from developing countries.  
In addition, Australia hoped that the demandeur s would share their own national experiences. 
19. The representative of Venezuela indicated th at his country had recently adopted a new 
national constitution which, for the first time in the country's history, contained environmental 
provisions.  All legislation was now being review ed in the light of this new constitution, and 
Venezuela was holding domestic consultations w ith various institutions, such as universities and 
NGOs, in order to ensure that all legislation complied with it.   
20. The representative of Djibouti
 stressed the importance of technical assistance in the 
negotiations, and the need for assistance that went beyond seminars.  Furthermore, he called for 
greater coordination between the different institutio ns that dealt with trade and environment.  
21. The representative of Korea  welcomed the national experience-sharing exercise, stressing that 
Members needed to have a more comprehensive body of evidence before them prior to drawing 
conclusions. 
22. The representative of the European Communities  (EC) thanked Canada for its intervention, 
which showed how certain principles and criteria could be distilled from the discussion, and could 
contribute to conflict prevention.  Canada had al so demonstrated how the gap between the national 
experience-sharing exercise and the more ambitious  approach of governance principles, could be 
bridged.  The EC indicated that it would also be  sharing its national experience with the Committee 
soon. 
23. The representative of Chinese Taipei  emphasized that the negotiations should not prejudice 
the WTO rights of any Member that was not a party to an MEA.  Moreover, he supported the view 
that unilateral action should be avoided, since it ran counter to multilateral efforts to deal with 
environmental problems, and damaged the multilate ral systems established to solve these problems 
collaboratively.  Because the achievement of ME A objectives usually required the involvement of 
several different governmental agencies within a country, coordination and co-operation between 
these agencies was of prime importance.  There wa s also a need for coordination between MEAs and 
the WTO, in order to reduce potential conflicts.   
24. The representative of Colombia  reiterated her country's support for greater national 
coordination, which could contribute to conflict prev ention.  Colombia believed that an exchange of 
information on the mechanisms that countries used for national coordination could be helpful in the 
identification of principles of good public manageme nt.  However, Colombia stressed that the national 
coordination approach - which rested on the notion that the WTO-MEA relationship could be left up 
to each WTO Member to decide - would not be a su fficient response to the Paragraph 31(i) mandate.  
The mandate required that mutual supportiveness be ensured. 
25. On the question of which MEAs to focus on, Co lombia reiterated the position that it had taken 
in document TN/TE/W/43, that the CTESS should examine the MEAs of greatest interest to WTO Members or those to which most Members were part y.  Such an approach would enable the CTESS to 
gradually expand its investigation to other MEAs th at contained STOs.  Colombia suggested that the 
Committee agree on an indicative list (and not a comprehensive one) of STOs in MEAs. The list could be adopted with the understanding that the an alysis and balance of the Committee's conclusions 
on this subject would not be limited to the selected MEAs or STOs.   
26. Colombia agreed with the EC that STOs in  MEAs should be formulated in a way that 
corresponded to the objectives of these agreements.  WTO Members had to ensure that these STOs 
were applied in a way that was compatible with WTO rules.  This would require careful national 
coordination, as Australia had recommended.  In addi tion, certain principles could be used in drawing  TN/TE/R/11 
 Page 5 
 
 
up STOs in MEAs, such as the principle of a trad e measure having a scientific basis, proposed by 
Australia.  However, this principle was not  applied as a general rule within MEAs. 
27. Colombia believed that it was important to bear  in mind the fact that only the Meetings of the 
Parties (MOP) to MEAs, as their highest decision-making bodies, could provide guidance on the criteria on which trade measures could be based.  It was therefore important to recognize that 
multilateral environmental policy can only be deci ded within the framework of MEAs, just as 
multilateral trade policy can only be decided within th e WTO.  In light of this, Colombia stressed the 
importance of recognizing the principles of "no hierarchy" and "deference" in the WTO-MEA relationship.  To respond to the Paragraph 31(i)  mandate, the CTESS needed to consider various 
scenarios of potential conflict, even if hypothetical, and to draw up principles that would prevent them 
from arising.  Having said that, Colombia believed th at an exchange of concrete national experience 
would be important, as had been indicated by Australi a, but that it did not exclude the consideration of 
hypothetical scenarios.   
28. Colombia had understood Australia's approach to mean that in situations of potential conflict 
between STOs and WTO rules, such conflicts could be  resolved at the national level.  This implied 
that each country could define parameters of its own for dealing with such conflicts in an exclusively 
national or domestic context.  Howe ver, it believed that it would be u seful to have certain parameters 
agreed to in the WTO on conflicts that could arise at the international level, particularly for situations 
where a Member that was not a party to an MEA was being subjected to an STO by a Member that was party to that agreement.  Colombia agreed with  the EC that it would also be useful to look at 
factors that have prevented conflicts from arising so far.  The CTESS did not need to await a real 
conflict in order to develop guiding principles. 
29. The representative of Switzerland
 welcomed the notion of conflict prevention advocated by 
the EC and others.  Canada's statement had gone beyond mere national experience sharing, going into 
criteria that could be used for conflict prevention,  which was helpful.  Switzerland commented on the 
distinction that was being established between the so-called "demandeurs" and "non-demandeurs" in 
these negotiations, saying that it was puzzling, sin ce all Members were equally bound by the Doha 
Development Agenda (DDA). It welcomed the Chairman's report to the Trade Negotiations 
Committee (TNC) (TN/TE/10), in which he had urged Members to find common ground between the national experience sharing and the conceptual appr oaches, as well as to identify potential synergies 
between Paragraphs 31 (i) and (ii).  Switzer land was currently working along these lines. 
30. The representative of Thailand
 stated that the Thai Ministry of Natural Resources and the 
Environment was undertaking a review of how Th ailand had implemented various STOs in MEAs, 
through a literature review, as well as consultations  with relevant agencies, NGOs and the private 
sector.  The review would be concluded by the en d of September 2005, and its conclusions shared 
with the Committee. 
31. The representative of Japan  welcomed the national experience-sharing exercise and indicated 
that Japan was currently working on a submission of its own. 
32. The representative of the Convention on International Trade in Endangered Species  (CITES) 
thanked the WTO Secretariat for having delayed the distribution of document TN/TE/S/5/Rev.1 - 
Matrix on Trade Measures Pursuant to Selected MEAs  - in order to incorporate the recent results of 
CITES' last Conference of the Parties (COP), which was the 13th Meeting held in Bangkok, Thailand 
in October 2004. The document now reflected the ne w and revised resolutions that had been adopted 
at that meeting.  In particular, longer-term, inte rpretative sets of guidance had been agreed upon.  
However, the document did not show the additional decisions that had been adopted.  They dealt with 
national wildlife trade policy reviews, which were to  be undertaken in consultation with interested 
Parties if funding could be obtained, as well as with further work on economic incentives. TN/TE/R/11 
Page 6  
 
33. The Chairman
 indicated that the recent decisions to which CITES had referred would be 
incorporated in the next revision of the TN/TE/S/5/Rev.1. 
II. PARAGRAPH 31 (II) – INFORMATION EXCHANGE AND CRITERIA FOR THE 
GRANTING OF OBSERVER STATUS3 
34. The representative of Switzerland  believed that the mandate given to the CTESS in 
Paragraph 31 (ii) was of importance for the prom otion of mutual supportiveness between trade and 
environmental policies, and was of the opinion that discussion on this mandate needed to be 
relaunched.  She believed that the development of  models of co-operation between trade-related 
MEAs and the relevant WTO committees would al so benefit the discussion on Paragraph 31 (i). 
35. With regard to information exchange between  trade-related MEAs and the relevant WTO 
committees, she argued that the MEA Information Sessi ons that had been held in the CTE had been 
very useful, and that Switzerland wished to see th e procedures for information exchange regularized, 
while maintaining a certain degree of flexibility.  The Swiss submission (TN/TE/W/32) had suggested 
a set of modalities for co-operation between the WT O and MEAs, such as through the organization of 
regular meetings with MEA secretariats, back-to- back with the CTESS, focussing on specific themes.  
Such procedures could enhance co-operation and mutual supportiveness between environment and 
trade rules, but did not represent an exhaustiv e list.  Hence, Switzerland was open to other 
suggestions.  In this regard, it pointed to the list th at had been drawn up by the former Chairperson of 
the CTESS, Ambassador Yolande Biké, in document TN/TE/7, which had enum erated several forms 
of enhanced co-operation and information excha nge. She proposed that future discussions be 
organized around that list. 
36. On observer status, Switzerland believed that  the granting of observer status to MEA 
secretariats and UNEP should take place in the re gular CTE and its Special Session.  Discussions 
should be based on criteria set forth in Annex 3 of the Rules of Procedure for Sessions of the Ministerial Conference and Meetings of the Gene ral Council (WT/L/161).  The Swiss delegation had 
presented, in its previous submissions, three main criteria:  First, that decisions be taken on a 
case-by-case basis based on a written request;  second, that the MEA secretariats and UNEP 
requesting observer status have a direct interest in the Doha negotiations on trade and environment;  
and third, that reciprocal treatment be provided to the WTO.  Switzerland saw these criteria as a good 
starting-point for the negotiations.  The representative of Colombia
 welcomed the criteria proposed by 
Switzerland, although Colombia believed that progr ess on Paragraph 31(ii) would to some extent be 
dependent on 31(i). 
37. The representative of the European Communities  wished to see more progress made on this 
part of the mandate, which was not controversial.  The observership i ssue could be more difficult than 
that of information exchange, but the CTESS could tr y to make progress on the easier parts first.  The 
EC reminded the Committee of the various submissi ons that had already been tabled on this 
Paragraph, and supported the Swiss suggesti on of basing discussions on the list drawn up by 
Ambassador Biké.  The representative of Norway  welcomed the statements by Switzerland and the 
EC, and the idea of using Ambassador Biké's list as a basis for future discussions. 
38. The representative of Japan  also welcomed the Swiss and EC statements, and wished to see 
the discussion on this part of the mandate reactivated .  On information exchange, Japan believed that 
the Information Exchange Sessions with MEAs that  had been held back-to-back with the CTE had 
been  useful, and that the CTESS could discuss their frequency.  On observer status, Japan argued that 
such status needed to be granted to organizations with a strong linkage to the CTE's mandate.  It was 
                                                      
3 Document TN/TE/S/2/Rev.1, entitled Existing Forms of Cooperation and Information Exchange 
between UNEP/MEAs and the WTO , was circulated at the meeting.  TN/TE/R/11 
 Page 7 
 
 
unclear on why this part of the mandate was bei ng linked to general principles for observership.  
Japan did not wish to see these negotiations politicized.   
III. PARAGRAPH 31 (III) – ENVIRONMENTAL GOODS AND SERVICES4 
39. The Chairman  informed participants that, at the last meeting of the Negotiating Group on 
Non-Agricultural Market Access (NAMA) (31 January to 4 February 2005), there had appeared to be 
an understanding that the definitional exercise on e nvironmental goods would be conducted in the 
CTESS, taking the form of a list or otherwise.  Th erefore, he urged Members to contribute to the 
definitional exercise, drawing their attention to three new documents that had been submitted under 
this item:  documents TN/TE/W/46 by New Zealand, TN/TE/W/47 by the EC, and TN/TE/W/48 by Korea.   
Document TN/TE/W/46 by New Zealand 
40. The representative of New Zealand
 presented document TN/TE/W/ 46, indicating that his 
country would be submitting its list of  environmental goods in advance of  the next meeting.  It would 
be a "living list," and would be compiled using the "reference points" and categories outlined in 
New Zealand's submission.  He urged Members not to place the CTESS' deliberations of the living list 
of environmental goods in the context of Members' so-called "offensive intere sts" (i.e. expansion of 
exports) or "defensive interests" (i.e. restriction of  imports).  Rather, he hoped that Members would  
place them in the context of both the economic and environmental benefits th at could be derived. 
Furthermore, he indicated that trade liberalization in this area was not likely to be as difficult as some 
Members had assumed, since recent research by the WTO had demonstrated that the applied tariffs on 
environmental goods were already quite low.  On av erage, the tariffs of developed countries were less 
than 5%, whereas those of developing countries were  less than 10%.  Of course, non-tariff barriers 
(NTBs) would also need to be considered. 
41. The representative of Indonesia , speaking on behalf of Indonesia and the Philippines , 
welcomed New Zealand's proposal and its suggestion for the use of reference points.  These would be 
useful in screening products, and as New Zealand ha d itself confirmed, would not confer automatic 
"environmental goods" status onto any product.  Howe ver, the concept of a living list raised some 
concern, particularly with respect to the modalitie s that would be applied to future environmental 
goods.  Indonesia asked how these modalities would be decided. 
42. The representative of Thailand  indicated that his country was preparing its own 
environmental goods list in consulta tion with relevant governmental agencies, the Ministry of the 
Environment and Natural Resources, the private se ctor, the Federation of Industries, and various 
chambers of commerce.  It had proved to be a difficult task.  Thailand welcomed the paper from 
New Zealand and the approach of "defining  by doi ng."  It also welcomed the first two reference 
points in that paper, indicating that the OECD and APEC  lists could act as useful tools at this stage of 
the negotiations. On the two-list approach, Th ailand’s view was that since the goods on the 
complementary list would not require consensus, the 85% benchmark of support set by New Zealand 
was too high.  Furthermore, Thailand was uncomfortab le with the concept of a living list, but in any 
case believed that the modalities for the ne gotiations should be handled by NAMA. 
43. The representative of Hong Kong, China  was open to the idea of reference points and a living 
list.  The concept of a living list would allow the li st of environmental goods to be updated to reflect 
economic, as was well as technol ogical progress.  However, Hong Kong China argued that it would be 
important to leave the modalities of the negotiations for NAMA to decide. 
                                                      
4 The  Report on the Workshop on Environmental Goods  that was held on 11 October 2004 was 
circulated to Members as document JOB(05)/21.   TN/TE/R/11 
Page 8  
 
44. The representative of Switzerland
 welcomed the reference points suggested by New Zealand, 
even though she was aware of some of their shor tcomings (such as the relativity of the concept of 
environmental friendliness and the dangers of tec hnological lock-in).  Despite these shortcomings, 
however, they provided a useful starting-point - one that would allow the CTESS to build on what 
was "already out there."  Switzerland found the concep t of a living list to be an interesting one, and 
would be giving it further consideration.  Th e representative of the European Communities  also 
welcomed New Zealand's paper, and the idea of  reference points and of a living list.  
45. The representative of Mexico  welcomed the reference points in New Zealand's paper, but 
cautioned that the use of criteria for the identifi cation of environmental goods did not necessarily 
mean that these goods were acceptable to Member s, or that consensus had been achieved.  
Negotiations would still be required. 
46. The representative of Japan  stated that it would be very impo rtant to develop a "raw list" of 
environmental goods as soon as possible, as suggeste d in paragraph 10 of the New Zealand submission, 
and to submit a WTO list of environmental goods to NAMA at the Hong Kong Ministerial Conference 
so that the negotiations on modalities could begin.   The reference points s uggested by New Zealand 
could be a useful tool in the preparation of that raw list. 
47. The representative of Chinese Taipei  supported New Zealand's refere nce points, and the idea of 
preparing a raw list of environmental goods.  Furthe rmore, he supported the suggestion of both Canada 
and New Zealand to work within the framework of certain categorie s in order to develop lists.  
However, Chinese Taipei was particularly interested  in starting CTESS discussi ons on the basis of the 
lists that Members had already tabled, and which had already undergone national c onsultation processes.   
48. In paragraph 9 of the New Zealand paper, New Zealand had suggested us ing the 12 categories 
that had been proposed by Canada, in addition to tw o others.  Chinese Taipei welcomed this approach, 
which would give greater clarity to the pollution pr evention category in partic ular, for which there was 
substantial support.  Nevert heless, too many categories could also l ead to the danger of the same product 
being classified under different ca tegories by different Members.  For instance, in the OECD list, 
product HS 842220 had been classified under pollution prevention, whereas Japan had included it under 
resource management.  Therefore, some streamlining of categories would be required, with countries 
refraining from using more categories than necessary .  With respect to the concept of a living list, 
Chinese Taipei believed that it went beyond the Doha mandate. 
49. The representative of Australia  agreed with New Zealand’s suggestion of "reference points" as 
an initial screening mechanism for environmental goods.  The reference points, as a minimum, had to 
be both practical and scientifically based.  They c ould assist in identifying products in different 
end-use categories.  Australia saw product lists a nd categories as the most constructive way forward. 
50. The representative of the United States  reminded delegations of the division of labour 
between the CTESS and NAMA, and supported the id ea that the discussion on modalities should be 
left for the moment.  The CTESS’ main task was to identify environmental goods, irrespective of a 
subsequent decision by the NAMA on how trade liberalization would be accomplished and S&D 
treatment applied.  The US welcomed the referenc e points suggested by New Zealand, which offered 
a simple and common-sense solution to the question of criteria.  It wondered whether New Zealand 
intended the reference points to be self-selecting, meaning that any Member that put forward a list of goods would use the points that it deemed most appropriate to describe them.  Some Members had already followed this approach in the lists that they had submitted to the CTESS, demonstrating the 
relevance of their products to the environment.  The US had also found the categories proposed by 
Canada, and added to by New Zealand, to be useful .  While some support had been expressed at this 
meeting for the US idea of a core and a complementary list (an idea reflected in the New Zealand submission), the representative of the United States
, supported by Canada  and Japan , argued that it 
would be best, at this stage, to focus on the product identification exercise.  TN/TE/R/11 
 Page 9 
 
 
51. The representative of Canada  welcomed the reference points suggested by New Zealand, and 
believed that there could be linkages between thes e points and the product categories.  Canada also 
welcomed the idea of a living list, but did not have  firm views on whether this idea should be handed 
over to NAMA or whether it could be dealt with by  the CTESS.  It also wondered how the NTB part 
of the mandate would be operationalized and wh ether it would need to be handed over to the 
TBT Committee or to NAMA.   
52. The representatives of Chile , Venezuela , China , Brazil , Colombia and Ecuador  argued that 
the reference points suggested by New Zealand were too restrictive for developing countries.  They 
stated that some developing countries would need  to go beyond the APEC/OECD conceptualization 
of an environmental good, since they were net im porters of the products on the APEC and OECD 
lists.  The representatives of Chile  and Venezuela  also pointed out that the vast majority of WTO 
Members had not actually participated in the preparation of these lists. 
53. The representatives of Venezuela , Colombia  and Ecuador  also requested an explanation of 
New Zealand's third reference point, of bilateral or  regional trade agreements.  The representatives of 
Venezuela  and Colombia , in particular, informed the CTESS that their countries were not party to 
regional or bilateral trade agreemen ts that had considered the notion of an environmental good.  On 
the same subject, the representative of Chile  enquired whether New Zealand had had a model free 
trade agreement (FTA) in mind, and if it intended Ar ticle XXIV of GATT to serve as the benchmark.  
Chile indicated that, in the FTAs that it had been involved in, ambitious outcomes had been sought that liberalized trade in all products, and not just  in those that met environmental requirements.  
54. The representative of Argentina
 agreed that the New Zealand paper raised concern with 
respect to its reference points, since these did not see m to be purely indicative.  They were designed to 
act as a "filter," and in that sense were conclusi ve in nature.  Furthermore, Argentina could not 
understand, either, the third reference point that ha d been suggested by New Zealand, of high quality 
regional or bilateral accords.  The representative of Egypt , like the US, enquired if New Zealand’s 
reference points were intended to be self-selecting.  If they were, then Egypt would be satisfied.  
However, Egypt, like Argentina, had its doubts, since paragraph 7 of the New Zealand paper had 
suggested that these points constituted a "t hreshold."  The representative of Thailand  argued that the 
bilateral FTAs suggested by New Zealand would be unacceptable as a reference point, due to the fact 
that these agreements did not represent the intere sts of all WTO Members. With respect to the 
regional ones, Thailand hoped that New Zealand could provide some examples. 
55. Turning to the modalities suggested in the New Zealand submission, and to the notion of a 
core and a complementary list, the representatives of Colombia  and Ecuador  saw this discussion as 
premature.  The representative of Ecuador  added that the issue had to be left up to NAMA, and that 
the requirements of Paragraph 16 of the DDA woul d need to be taken into account, including on 
reciprocity.  Furthermore, Ecuador indicated that it had been confused by the concept of a living list 
and by how products would be added onto such  a list.  The representative of Colombia  also pointed 
out that, whereas there appeared to be an emergi ng consensus on pollution control products, agreed 
criteria would need to be developed prior to tariff reductions and modalities being considered.  
Agreeing on criteria for an environmental good would of  course be time consuming, but that was the 
reason why time and effort would be needed in these negotiations. 
56. The representative of Chile  believed that the New Zeal and paper had gone beyond the 
mandate of the CTESS in suggesting a dual-list a pproach.  This prejudiced NAMA negotiations.  
Furthermore, with respect to the concept of a liv ing list, Chile could not agree that the future 
liberalization of additional environmental goods some how be mandated or endorsed at this stage.  
When the results of the Doha Round became cl earer, Chile would see whether these results were 
insufficient, and whether a political decision would be  needed to review the results of the Round as a 
whole, and not just in the environmental goods area.   As justification for the living list, New Zealand 
had argued that this particular area was a dynamic one and that any list would need to be updated.  TN/TE/R/11 
Page 10  
 
However, Chile believed that dynamism was not a f eature that was unique to the environmental goods 
area of the negotiations. 
57. The representative of Argentina
 also commented on the idea of a core and a complementary 
list.  Argentina wondered how New Zealand's reference points would be used with respect to the 
two-list approach.  Would the reference points filter pr oducts that went into both lists, or simply those 
that went into the core list?  And would consensu s be required in addition to the application of the 
reference points?  Argentina's understanding of th e two-list approach was that the core list would 
capture products on which there was consensus, a nd the complementary list, other products.  With 
respect to the living list, New Zealand had explained that the list needed to be living, not just for 
technological advancement, but for other reasons as well.  Argentina wondered what those other 
reasons were. Furthermore, it wondered what th e relationship would be between the CTESS and 
NAMA. 
58. The representative of Cuba  was disappointed that the concept of Special and Differential 
Treatment (S&D) had been missing from New Zealand’s paper.  Cuba  could not agree to a "living 
list," which would require negotiation between R ounds.  However, it found New Zealand's reference 
points to be helpful. 
59. The representative of Qatar  argued that if Members analysed the APEC and OECD lists 
closely5 they would find that they only contained products  of interest to developed countries, and that 
the developing world's export to import ratio of these products was low, standing at 0.48.6  Many of 
the lists submitted by Members to this meeting ha d been based on the APEC/OECD lists.  These lists 
did not contain products, such as natural gas, whic h were produced and expor ted by many different 
countries such as Qatar, Algeria, Indonesia, Norway, and Russia.  Natural gas, which was now widely 
used in electricity production, contributed to su stainable development, and its inclusion in a WTO 
environmental goods list would de monstrate how developing countries had environmentally friendly 
exports.  Qatar had numer ous unanswered questions about how the APEC and OECD lists had been 
compiled.  For instance it wondered why "separators"  that were used on oil platforms to separate oil 
from water and gas had been included these lists, but not natural gas itself.  
60. Qatar also expressed its support for the idea of  a core list of environmental goods, with 
built-in flexibility that would allow it to be a living list.  It did not support the idea of a complementary list, which could waste negotiators' ti me in moving products out of the core list and 
into the complementary list.  It reiterated its requ est for the inclusion of natural gas products in the 
negotiations, providing three justifications:  (1) the fact that the demand for energy was rising, and 
that, according to the International Energy Agen cy (IEA), the share of renewable energy on the 
market was going to rise to 25% by 2050 due to the Kyoto Protocol.  Natural gas emitted 28% less CO
2 than oil and 44% less CO 2 than coal;  (2) that there were synergies between natural gas and 
renewable energy, for instance in hybrid systems;   and (3) that the Kyoto Protocol had itself 
recommended the increased use of natural gas to comb at global warming.  Finally, it indicated that it 
wished to see progress made under Paragraph 31(iii)  by July 2005.  The representative of Ecuador  
found the Qatari proposal to be interesting, to ha ve environmental benefits , and to be worthy of 
further consideration.  The representative of Oman  agreed with a Qatar on the need for a single list 
with built-in flexibility. 
61. The representative of New Zealand  explained that New Zealand was aiming for ambitious 
results in the environmental goods area.  It did not  wish to see modalities discussed in the CTESS, and 
understood that that was NAMA’s role. It welc omed the widespread support for "defining 
                                                      
5 See document TN/TE/W/33, entitled OECD Joint Working Party on Trade and Environment. 
Environmental Goods:  A Comparis on of the APEC and OECD lists. 
6 See page 5 of the  Report on the Workshop on Environmental Goods  ( JOB(05)/21).  
  TN/TE/R/11 
 Page 11 
 
 
environmental goods by doing," and explained that  it did not see its reference points as a definitive 
set.  Members could propose their own.  The idea behind the reference points was simply to ask Members to justify why the products included on thei r lists could be character ized as environmental. 
The OECD definition, and not its list, as well as th e APEC conceptualization, could in that sense 
serve as a good basis for this exercise. New Z ealand reassured delegations that the use of the 
APEC/OECD conceptualization would not necessarily mean an endorsement of the lists that these 
organizations had developed.  
62. In response to the question from Argentina, Ne w Zealand clarified that the reference points 
would be used to structure both the core and comp lementary lists, since the threshold for the second 
list could not be lower than that which Members app lied to the first.  Several delegations had asked 
whether the absence of reference points would preclud e products from the list.  New Zealand believed 
that it should.  It was not too much to ask countri es that submitted products to explain why they were 
environmental.   
63. Turning to the issue of dual lists, New Zealand clarified that its paper had clearly called for 
the development of a "raw list."  It had not asked fo r the negotiation of parallel lists.  The raw list had 
to come first.  New Zealand had also pointed out in  its paper that a single list would be the first best 
outcome.  A number of Members had enquired if New Zealand could provide examples of the 
regional or bilateral agreements that it had sugg ested.  The answer was that it could not.  By 
proposing this third reference point, New Zealand’s intention had been to encourage this sort of 
development.   
64. With respect to the living list, New Zealand e xplained that the concept would simply enable 
Members to update and expand the list in response to technological development.  It did not mean that 
a high-tech lock-in would occur;  rather, the liv ing list could allow for low-tech products to be 
included as they were discovered.  New Zealand ga ve the example of diatomaceous earth, which was 
a filtering agent for cleaning water in water and so il remediation processes, and which did not appear 
on either the OECD or APEC lists.  New Zealand ha d recently discovered that this product was also a 
very effective insecticide that had been widely used  in developing countries' agriculture.  A living list 
would allow Members to incorporate such products wh en discovered.  New Zealand explained that, in 
developing its own list, it would be looking not only at  items of export interest, but of import interest 
as well.  Cheaper imports would help with the effi ciency and competitiveness of its domestic industry. 
Document TN/TE/W/47 by the European Communities  
65. The representative of the European Communities
 presented document TN/TE/W/47, 
indicating that the starting-point in the preparation of this submission had been to see how the WTO 
could best contribute to the fulfilment of MEAs, the Millennium Development Goals (MDGs) and the 
results of the World Summit on Sustainable Deve lopment (WSSD).  Assessing the interests of 
developing countries, and reflecting them, had constituted another starting-point.  The EC agreed with 
the New Zealand approach of a "living list" and had itself cautioned against any "technological 
lock-in" in its submission.  As a background for th e products on its lists, the EC explained that it was 
not its intention to engage in a protracted discussion on the "definition" of an environmental good.  Rather, its aim was to contribute to the emergence of a common understanding of the concept through the use of some sort of a filter, or what some Members called "reference points."   
66. The EC focussed on explaining the second list of pr oducts contained in its submission, which 
was a list of "High Environmental Performance or  Low Environmental Impact" products, stating that 
it had drawn on the work that the United Nations  Conference on Trade and Development (UNCTAD) 
had conducted on Environmentally Pref erable Products (EPPs).  Most of  the products on its list were 
identifiable through their composition.  In paragr aphs 14 and 15, the EC had sought to expand the 
products on that second list to ones that could be id entified through labelling.  However, the labelling 
issue was not relevant to the second list as a whole,  and therefore the EC hoped that the second list TN/TE/R/11 
Page 12  
 
could be discussed prior to the labelling issue bein g taken up.  It saw thes e as separate issues. The 
labelling issue had to be seen as an "offer" by th e EC to expand the second lis t to products that could 
be of interest, in particular, to developing countries.   The EC indicated that it would be tabling a more 
complete list of products in the near future, and th at it was conscious of th e fact that its current 
submission had only provided examples of products  that could be included in the negotiations. 
67. The representative of Colombia
 agreed with the EC that the products identified in these 
negotiations needed to contribute to the fulfilment  of MEAs, to the MDGs and the results of the 
WSSD.  However, while Colombia agreed that trade liberalization in environmental goods and 
services could allow developing countries to purch ase environmental technology more cheaply, it 
warned of technological dependence if an approp riate balance between developed and developing 
countries interests was not struck.  Many of the pr oducts that were currently being proposed were 
high-tech products for which developing countries did not have a clear export interest.  In fact, it was 
the challenge of identifying products that could benefit Colombia that had prevented Colombia from 
tabling its own list until today.  However, it wa s clear that any list would need to have the 
conservation and sustainable use of natural resources as its primary aim, including the in situ  
preservation of biological resources and their marketing and promotion.  
68. With respect to eco-labelling, Colombia wonde red whether this could be considered a new 
NTB.  It enquired whether mutual recognition ag reements (MRAs) would then be needed.  The 
International Standardization Organi zation (ISO) labelling standards that had been referred to by the 
EC could indeed be examined, but Colombia hoped that these standards would not obstruct 
developing country trade.  It felt that it would also  be premature at this stage to discuss the modalities 
proposed by the EC.  However, it indicated that it was in favour of a single list of environmental 
goods. 
69. The representative of Ecuador agreed with the objectives of the WSSD and Agenda 21, which 
had been mentioned in the EC paper.  However, Ec uador was concerned that many of these objectives 
had not been fulfilled, particularly with respect to  technology transfer.  Like Colombia, Ecuador was 
also concerned about technological dependence, a nd about the fact that many technologies were 
difficult to access, due to patents.  In terms of the actual negotiations, it indicated that it would be 
necessary to tackle the problem of dual use.  Ecua dor did not have firm views yet on the second EC 
list, but argued that NTBs were some of the main barriers confronting the pr oducts of export interest 
to developing countries.  It wondered, therefore,  what the positive incentive would be for developing 
countries to subscribe to the second EC list.  
70. The representative of Thailand  was of the view that the second EC list of goods would make 
it harder for countries to prepare their lists, rather  than easier, in particular since it would bring 
process and production methods (PPMs) into the discussion.  Eco-labelling would not help the 
discussion, either.  The representative of Cuba  believed the negotiations need ed to take into account 
the different levels of development that countri es were at.  Cuba believed that PPM-based products 
had indeed been included in the EC's second list of products, and that that was the reason why 
certification and labelling had been  deemed necessary by the EC. 
71. The representative of Mexico  found that the second EC list brought NTBs into the 
negotiations, through eco-labels and certificates.  He was convinced that the best way to handle 
agricultural products in the negotiations would be  through agriculture negotiations under the DDA.  
The representative of Argentina  stated that he was aware of the serious reservations that some 
Members had regarding the second EC list, but indicated  that he did not have a final position on it yet. 
72. The representative of Malaysia  felt that the EC's submission took the CTESS down a 
conceptual, definitional, track which could be too time consuming for the Committee.  End use 
criteria were the best and simplest way of identif ying environmental goods.  She could not agree that 
labels and certificates be explored in these negotiati ons, since they would slow them down.  On the  TN/TE/R/11 
 Page 13 
 
 
concept of a living list, proposed by the EC and New Zealand, Malaysia preferred to see the CTESS 
focus on the development of a Doha list at this stage,  rather than looking too far into the future.  The 
list had to include products of in terest to developing countries. 
73. The representative of Indonesia , speaking on behalf of Indonesia and the Philippines , 
addressed the EC's suggestion of using the environm ental objectives of MEAs and other international 
agreements as benchmarks.  Indonesia and the Philip pines believed that this would problematic for a 
number of reasons:  (1) certain MEAs had more th an one environmental objective, some of which 
could be viewed as more important than others;  (2) greater market access for environmental goods 
was not the only way of contributing to the objectiv es of environmental agreements.  Financial aid 
and technology transfer were other approaches;  and (3) different WTO Members were parties to 
different agreements. Furthermore, with resp ect to the suggestion that Members' national 
environmental objectives guide the negotiations, they ar gued that this had to remain the prerogative of 
each individual Member.  Members that felt that "high environmental performance products" were in 
their interest could undertake autonomous liberali zation.  Indonesia indicated that it was working on 
its own list of environmental goods. 
74. The representative of Chile  welcomed the EC’s suggestion that Members try to facilitate the 
implementation of MEAs, the MDGs and the re sults of the WSSD through these negotiations. 
However, he was concerned about the implications of bringing global environmental standards into 
WTO negotiations. Furthermore, the EC had referr ed to the fulfilment of national environmental 
policies, but this could lead to the national polic ies of some Members turning into obligations for 
others.  With respect to the second list of EC prod ucts, Chile doubted the merits of working along the 
lines of UNCTAD's EPPs.  EPPs would usher certifica tion and labelling into the negotiations, leading 
the CTESS to stray beyond its mandate.  Chile sought  further clarification from the EC on the criteria 
that could form the basis of a WTO list. 
75. The representative of India  believed that, while many deve loped countries were operating on 
the assumption that these negotiations would deliver trade as well as environmental benefits through 
the acquisition of environmental technologies at a lo wer cost, these assumptions were not necessarily 
substantiated.  While India was environmentally conscious as a country, and was party to numerous 
MEAs, it had not succeeded in acquiring the environmental technology that was suited to it.  For instance, imported windmills used to generate re newable energy had failed in supplying energy to 
some of India's poorest households.  The problem, theref ore, was not just one of market access.  There 
were other factors that needed to be considered  for the technological advancement of developing 
countries, such as increased investment opportun ities, development coordination and so on.   
76. Furthermore, the current negotiations were  focussing exclusively on environmental goods, 
and the services component was being left aside . Synergies between these two areas of the 
negotiations were vital.  On another note, India obser ved that, with the exception of the EC's paper, no 
other submission had included agricultural goods. It  indicated that products such as jute, biofuels, 
organic agricultural products and bio-pesticides were of interest to developing countries, and that the 
reduction of the NTBs to their export would be  important to consider. The representative of 
Hong Kong, China
 agreed with the points that had been made by India.  However, she felt that 
environmental goods were more compli cated than environmental services, since a services classification 
already existed.   
77. The representative of Switzerland  agreed with the EC that the negotiations should somehow 
contribute to the fulfilment of MEAs, MDGs and to th e results of the WSSD.  The first list of products 
submitted by the EC was a "pollution control and resource management" list, which was the category 
on which most Members agreed. It corresponded to  the OECD's definition of the environmental 
industry.  However, this list did not cover the entire spectrum of environmental goods.  The second 
EC list, therefore, was intended to capture the rest , much of which could interest developing countries. 
The second list was based on the "life cycle approach ," and dealt with the component of a product's TN/TE/R/11 
Page 14  
 
life cycle that took place in the territory of th e importing country, i.e. with a product's use and 
disposal.  The idea proposed by the EC of expanding  this list through products that could be certified 
and labelled, was also an attractive one.  Switzer land welcomed the EC's suggestions on modalities, 
even if a final decision on modalities could only be taken by NAMA.  It hoped that NTBs would also be turned to at some stage through creative ideas.   
78. The representative of Norway
 expressed his support for the policy goals articulated in the 
EC's submission of helping fulfil MEAs and the M DGs.  He was also supportive of the concept of a 
living list, which would enable the WTO to keep  abreast of rapid technological advancement.  
Norway did not have a final position on the second EC list, but believed that certification and 
labelling could actually enhance market access, rather than the reverse.  Many products on the second 
list could be particularly releva nt for developing countries.  Technical assistance for these countries 
would also be vital. 
79. The representative of China  appreciated the consideration that the EC had given to the concept 
of S&D treatment in its submission, and its proposa l that developed and developing countries follow 
different timetables in the negotiatio ns.  However, China reiterated the suggestion that it had made for a 
"common" and a "development" list, in which it had also  proposed different rates of  tariff reduction.  For 
China, the issue of eco-labelling, that had been ta ken up by the EC, went beyond the Doha mandate. 
80. The representative of Japan  believed that it would be difficult to agree on criteria that could 
form the basis of the second EC list.  In particular, he argued that it would be ve ry difficult to distinguish 
EPPs from non-EPPs for the same product category.  However, Japan would comment in more detail 
once it found out, from the EC, the specific pr oducts that belonged to this category. 
81. The representative of Brazil  believed that the different lists that had been tabled by Members 
clearly showed that differ ent methodologies had been used.  Theref ore, there were various differences 
between Members that had to be bri dged, and it would be im portant not to rush the negotiations.  Brazil 
saw merit in pursuing a practical a pproach, rather than engaging in an overly conceptual discussion.  
However, it felt that it would still be necessary to ag ree on some basic principles or criteria for what 
constituted an environmental good.  The most im portant principle could be found in the Doha 
Development Agenda (DDA), which was that of "dev elopment."  The negotiations had to contribute to 
development.  Brazil was uncertain about the concept of a living list, which introduced uncertainty into 
these negotiations, and which had been  referred to by both the EC and New Zealand.  It amounted to 
writing a "blank cheque" for the future, which,  of course, was very difficult to do.   
82. Brazil welcomed the EC’s reference to Agenda 21, which had been the outcome of the 
Rio Earth Summit.  However, Age nda 21 had called for "common and differentiated responsibility," 
which was a concept that was closely tied to technology transfer.  However, this concept had not featured in the EC's submission, and Brazil wo ndered why. The EC had called for PPM-based 
eco-labelling in its submission, which it argued had drawn on the work of UNCTAD. However, 
UNCTAD had made an important suggestion at the WTO Workshop on Environmental Goods, in which 
it had proposed that a PPM waiver only apply to devel oping countries.  Brazil  wondered whether this 
was what the EC had had in mind.  
83. The representative of Chinese Taipei
 saw the EC’s "Guiding Prin ciples" as being similar to 
New Zealand’s "reference points," wh ich could be used in the prepara tion of a raw list.  However, as 
Indonesia had stated, the reference to the objectives of Agenda 21, WSSD and MEAs could complicate, 
instead of facilitate, the negotiations, and it could be easier to use the work of the OECD and APEC as a 
basis.  Second, in paragraph 9 of its paper, the EC  had suggested using specific HS codes for entire 
plants and systems, and Chinese Taipei wished to find  more about that.  Third, on the EC’s second list 
of products, Chinese Taipei sought clarification on the international environmental and eco-labelling 
standards that would come to unde rpin the list, and on how that li st would comply with the WTO’s  TN/TE/R/11 
 Page 15 
 
 
TBT Agreement.  Finally, it welcomed the Korean submission, which had been based on a very similar 
approach to its own. 
84. The representative of Australia  welcomed the EC’s first lis t of products, which seemed to 
correspond to the list that had been presented by  Chinese Taipei.  However, it differed from 
Chinese Taipei’s in its inclusion of renewable ener gy products.  Australia regr etted that the second EC 
list ushered labelling and PPMs into the negotiatio ns.  Responsibility for discussing environmental 
labelling lay with the TBT Committee and regular C TE.  Furthermore, the list also ushered in 
subjective criteria on what an environmental good was.   For instance, why was insulation material that 
was made of vegetable fibre envir onmental, but not material that w as made of animal products?  That 
said, Australia was encouraged by the statement in the EC's paper that consensus on a definition was 
not a prerequisite for the product-based approach.  Australia believed that it would be important in 
these negotiations to identify produc ts of export interest to developi ng countries, and felt that there 
were numerous sources of information from which ideas could be drawn, such as the UNCTAD, the APEC and the OECD lists, as well as the WTO Workshop on Environmental Goods.  
85. The representative of the United States
 welcomed various elements of the EC's paper, in 
particular the EC’s presentation of environmental products within the bounds of certain categories. 
However, the US wished to see products identified on  the basis of HS codes, without adjustment or 
introduction of new tariff headings, but with fl exibility for "ex-outs" in Members' national 
nomenclatures.  That said, the US hoped that Memb ers would err on the side of liberalization and 
simplicity where possible.  It looked forward to a future EC submission in which the various sectors 
and sub-sectors that they had included could tran slate into concrete HS codes and corresponding 
products.  In the absence of these codes, the US would find it difficult to react to the EC's proposal. 
However, the US was pleased with what appeared  to be a general endorsement of many of the 
technologies that had been included in the APEC lis t, including products such as pipes, filters, and 
monitors.  This presented a potential area of common interest among delegations.  
86. With respect to the second part of the EC's paper, the US was more sceptical on the potential 
for common ground.  The OECD had conducted a study on the feasibility of including energy 
efficient goods in an initiative such as this one , and had concluded that there were significant 
obstacles, such as how to determine the goods that qua lified for energy efficient status when different 
countries defined energy efficiency differently, an d when the concept was constantly evolving and 
differed by product.  The US was interested in h earing from the EC how it intended to overcome these 
issues, and, also, how it could ensure non-discriminati on.  For instance, as had been mentioned at this 
meeting, on what basis was the EC going to dis tinguish between insulation made from wood waste 
and conventional insulation?  
87. The CTESS had to be careful not to create ne w NTBs when it defined the concept of an 
environmental good, such as by means of eco-labels,  since it could not move in an opposite direction 
to the trade facilitation negotiations.  Even if th e scope of the EC proposal went beyond the narrow 
membership of the Global Ecolabelling Network (G EN), it would still be objectionable to the US.  
While eco-labels were a useful tool in differentia ting products in the marketplace, the US believed 
that they were not the appropriate tool for dete rmining tariff treatment.  In terms of identifying 
common ground in these discussions, it argued that it would be useful to use the first EC list, which identified pollution control and resource management equipment.   
88. The representative of Egypt
 asked for a clarification of paragraph 9 of the EC paper, where it 
appeared that the EC was suggesting a solution for the problem of dual-use.  With respect to the 
MDGs and the goals of the WSSD that had been cited by the EC, Egypt wondered if the EC would 
also be committed to their goals in other areas of the negotiations.  For instance, would the EC agree 
to liberalizing agriculture and services trade to reach their goals, and to halve world poverty by 2015?  
Egypt felt that it may not be practical to work on the basis of these goals in environmental goods 
negotiations. TN/TE/R/11 
Page 16  
 
89. The representative of Venezuela
 commented on the EC paper, by expressing his support for 
the work of UNCTAD.  At the WTO Workshop on Environmental Goods, UNCTAD had suggested that the Working Group on Trade and Technology Transfer be asked to examine environmental goods from a technology transfer angle, i.e. with respect to  the transfer of clean technology.  This issue had 
to be dealt with so that progress on Paragraph 31( iii) could be made by the Hong Kong Ministerial. 
90. The representative of Canada
 welcomed the EC’s reference to the WSSD and to 
environmental objectives, since this gave context to the work of the CTESS in these negotiations.  
The first EC list was fairly uncontr oversial and had attracted substantia l support.  With respect to the 
second list, Canada felt that it would be challengi ng for the EC to reconcile its suggestions for 
eco-labelling and certification with the opposition that had been voiced at this meeting for PPMs.  The 
EC had not yet provided the Committee with a list of products with HS codes, and the discussion of 
eco-labelling was likely to slow the CTESS down.   
91. Canada indicated that developing countries ha d expressed divergent views at this meeting on 
the kinds of products that could be of export interest  to them, and the concepts that they could work 
with.  For instance, Chile and Thailand had stated  that they supported th e entry of UNCTAD’s EPPs 
into the negotiations, whereas Venezuela had taken a different view, and India had asked for organic 
agriculture to be considered, and hence PPMs.  Brazil, on the other hand, had requested that 
UNCTAD’s suggestion for a PPM waiver for developi ng countries be considered.  Canada believed 
that the only way forward in these negotiations theref ore, was for Members to develop their own lists, 
since developing country interests diverged and coul d not be discussed in the abstract.  Thus, Canada 
was pleased that both Indonesia and Thailand had indi cated that they were working on their lists.  The 
representative of Brazil clarified that Brazil had not argued in favour of PPMs.  Rather, it had simply 
asked the EC to clarify the reference to PPMs that it had made in its submission. 
92. The representative of Panama  wished to see the CTESS develop criteria for environmental 
goods as expeditiously as possible.  Products of expo rt interest to developing countries would need to 
be identified, and the NTBs they faced somehow addressed.    
93. The representative of Oman , supported by Venezuela  and Panama , suggested that the Chairman 
conduct informal consultations on te chnical assistance for developing countries in the preparation of 
their lists.  The representatives of Colombia , Ecuador  and Venezuela  emphasized that technical 
assistance needed to come during the preparation of lists, and not  after, as suggested in the EC paper. 
94. The representative of the European Communities  clarified, in response to the question from 
Chile, that it was not asking any WTO Member to  accept an environmental objective that it had not 
already committed itself to – whether in terms of the MDGs or otherwise.  In other words, all it was 
seeking was that Members provide some  sort of justification for produc ts that they in cluded in their 
lists based on the commitments that they had already undertaken, or based on their national environmental policies.  It would not be sufficient fo r a country to offer as jus tification the fact that 
a product had featured on the APEC or OECD list.  
95. In response to the comment from Brazil, the EC explained that the principle of "common 
but differentiated responsibility" had not been addressed in the EC paper because it was not an 
environmental objective.  In resp onse to Egypt’s question on whether other objectives of the WSSD 
were guiding the EC in different areas of the negoti ation, the EC stated that  they certainly formed 
part of the backdrop.  In respon se to the comments made on the two EC lists, the EC agreed with 
Members that its first list was not controversial.  The second list was more so, but the EC indicated 
that it was an important list in that it tried to render the negotiations more inclusive.  It had 
proposed avenues that could be of particular interest to developing countries, since they were the main exporters of EPPs.  Furthermore, high performance, low impact, products were not necessarily 
PPM-based.  Many of these products were perfect ly distinguishable on  the basis of their 
composition.    TN/TE/R/11 
 Page 17 
 
 
96. On labelling, the EC stressed that this discussion had to be distinguished from the one held 
in the regular CTE.   Here labels were being di scussed as a way of identify ing environmental goods, 
i.e. as a way of increasing mark et access through the development of  a more comprehensive list.  
There were examples in the bilateral field where labels  had been used to this effect.  They were not 
a NTB to trade, but rather represented a market op ening opportunity.  On technical assistance, the 
EC stressed the importance of delivering techni cal assistance to developing countries during, as 
well as after, the preparation of their lists.  It asked the Chairman to consult on the matter, and to contact the WTO Technical Cooper ation and Training Division. 
Document TN/TE/W/48 by Korea  
97. The representative of Korea
 presented document TN/TE/W/48, indicating that Korea's 
objective had been to base its list of environmenta l goods on as simple and practical an approach as 
possible.  It had prepared its list of 89 products  in consultation with industry, NGOs and various 
stakeholders, and most of these products fell into  the pollution management category – the category 
that appeared to be the most uncontroversial in th e CTESS.  It hoped that current discussions could be 
focussed on products with Harmonized System (HS) codes. 
98. The representatives of Australia , the United States , China , Thailand , Malaysia , Indonesia , the 
Philippines , Mexico , and Israel  argued that the Korean approach represented the most practical way 
forward, and that the environmental end-use or  purpose of a product was the most appropriate 
criterion to use.  The representative of Thailand  asked that further discussion be held on the concept 
of end use.  Korea had stated that: "the end-use of  products should be primar ily for an environmental 
purpose," and Thailand wished to see further disc ussion of the concept of a "primary" purpose. 
99. The representatives of Australia , the United States , China , Thailand , Malaysia , Mexico  and 
Israel  called on the identification of products to be ma de on the basis of  HS codes (with ex-outs if 
needed), and on EPPs or PPMs to be avoided as suggest ed in the Korean submission.  In fact, to raise 
everyone’s comfort level in the negotiations, the representative of Australia , supported by the 
United States , suggested that an early decision be ta ken to exclude PPMs from the negotiation.  
100. The representatives of Canada  and Ecuador  also welcomed the Korean paper and the very 
practical approach on which it had been based.  Cana da indicated that it could agree to many of the 
products on the Korean list.  The representative of Japan  was also encouraged by the Korean list, which 
represented a good starting-point for the negotia tions, and included energy-saving products. 
101. The representative of th e European Communities  believed that the 89 products that had 
been included in the Korean list had included produc ts which were not only in Korea’s interest, but 
in other Members’ interest as well, and hence the EC welcomed them.  However, in contrast to 
Korea, the EC wished to take  these negotiations further. 
102. The representative of Brazil  welcomed Korea’s emphasis on practicality, but wondered whether 
the narrow approach taken in the Korean paper would allow the Committee to consider the products of 
export interest to deve loping countries.   
103. The representative of Chile  explained that he did not be lieve that the Paragraph 31(iii) 
mandate provided for deeper tariff cuts on envi ronmental goods.  The manda te was on a par with 
Paragraph 16 of the DDA.  Chile appreciated the prac tical approach that had been taken by Korea in 
its submission.  In paragraph 2, Korea had expl ained the process through which it had developed its 
list;  this had been helpful.  However, Chile i ndicated that it would be appreciated if future 
submissions could provide trade figures on the products that they proposed. 
104. The representative of Norway  stated that while Norway want ed these negotiations to deliver 
environmental benefits, it was also keen to have  them deliver trade benefits, in particular to TN/TE/R/11 
Page 18  
 
developing countries.  Norway had been in fa vour of a two-track approach in the CTESS on 
Paragraph 31(iii), a conceptual track and list-based  track.  It felt that there were a number of 
outstanding conceptual issues that were vital to the final outcome, such as that of dual-use.  For 
instance, Korea had argued in paragraph 6 of its su bmission that the end-use criterion would be easier 
to work with than that of PPMs.  Norway was not convinced and asked that this statement be 
explained.  There were other conceptual issues th at also needed to be addressed.  For example, it 
asked what would happen if a product used for an  environmental purpose contained substances that 
were harmful to the environment, such as mercury or  PCBs.  To some extent, its inclusion would have 
to depend on whether the importing country had appr opriate procedures for its handling.  Therefore, 
there was clearly a need for a "yardstick" in th ese negotiations (or for "reference points" as 
New Zealand had called them). 
105. The representative of Argentina
 stated that, while some Members had argued that these 
negotiations should not be looked at from a purely commercial perspective, trade had to remain 
central to them, since the WTO was a trade organizati on.  Argentina felt that it would not be easy for 
Members to agree on a common definition of enviro nmental goods, and therefore preferred to pursue 
a practical approach that would simply try to deve lop criteria or categories that countries could adhere 
to.  These would be more than sufficient to create a shared vision of where the negotiations should go.  
The Korean paper represented a restricted view of what these negotiations could include.  The 
New Zealand paper had been more ambitious, and th e EC's even more so.  However, the Korean 
paper, which only included 89 products, did not appear to include products that could be of interest to 
developing countries. 
106. The representative of Korea  explained that, in terms of 6-digit HS codes, Korea’s list 
covered 60% of the products on the APEC list, a nd 50% of the products on the OECD list.  Korea 
did not intend to comment on whether its list had been narrow or broad, since each WTO Member 
had to determine, in light of its own interests, the scope of the offer that it could make.  In terms of finding products of interest to developing countries, Korea believed that this would be a challenging 
task, since trade flows in envi ronmental goods were heavily skewed in favour of developed 
countries.  To address some of the products of  export interest to deve loping countries, the 
controversial PPM criterion may need to be introduced.  This would raise its own set of problems.  Hence, there was no easy answer to  developing country concerns.  In terms of paragraph 6 of the 
Korean submission, on which some Members had so ught clarification, Korea explained that it saw 
the end-use criterion as easier to  work with than PPMs, since it addressed the dual or multiple 
end-use problem.  It would also allow for specific prop osals to be made through the use of ex-outs.   
107. In response to Chile’s question on trade statistics,  Korea explained that the tariffs imposed by 
Korea on the products on its list ranged between 2-8%.  Some products were already imported duty 
free.  However, Korea had not selected products on the basis of low tariffs.  Rather, most of the products on the OECD and APEC lists continued to be subjected to tariffs of below 8% in Korea. 
Statements by the Ad Hoc Invitees 
108. The representative of UNCTAD
 briefed the CTESS on the expert meeting that UNCTAD had 
organized on renewable energy on 8 February 2005.  The experts present at the meeting had indicated 
that trade in renewable energy was gaining in impor tance.  However, the level of tariffs imposed on 
renewable energy varied between 40% to 100%, w ith relatively high tariffs imposed on finished 
renewable energy products in some developing co untries.  These countries were using tariffs to 
protect their domestic industry, where the scope for other protective measures was limited.  Lowering 
tariffs in these countries could run the risk of  choking off new opportunities for the production and 
export of their own renewable energy products.  Therefore, market deployment policies were 
required, which were policies that helped countri es with the costs of introducing renewable energy 
into their markets.  These policies were generally in tended to be of a limite d duration, until renewable 
energy could become competitive.    TN/TE/R/11 
 Page 19 
 
 
109. The competitiveness of renewable energy depe nded on the cost of conventional energy.  
Some experts at the meeting cited the subsidies to  oil, coal, gas and nuclear power that various 
countries provided, and which were a barrier to th e development of renewable energy.  Developing 
countries were relatively competitive in renewable en ergy due to the fact that various sources of 
renewable energy were available to them, and du e to their lower costs.  There was scope for 
cooperation between developed and de veloping countries in this area, since certain renewable energy 
technologies, such as hydropower, geothermal ener gy, and biomass, were reaching "pre-saturation" 
stages in developed countries.   
110. The experts wondered about the role that the WTO Agreements on Agriculture and TBT 
could play in the renewable energy sector.  For instance, they wondered how the Agreement on 
Agriculture could affect fuel farming and bioene rgy, and how the TBT Agreement could discipline 
the technical regulations that were used to limit th e use of ethanol blends.  One question for the WTO 
was whether it should focus on renewable energy, or expand into considering low-carbon energy sources and technologies, such as natural gas – which was the fastest growing source of energy after non-hydro renewables.  UNCTAD indicated that some of these issues would be revisited at the 
forthcoming Commission on Trade in Goods and Se rvices and Commodities, which was going to be 
held on 17 March.  
111. The representative of the OECD
 believed that many of the criticisms levelled at the APEC 
and OECD lists related to the fact that these lists had not been developed by the WTO.  He explained 
that the OECD list had not been developed for the purposes of Paragraph 31(iii) negotiations.  Rather, 
it had been developed as part of an analytical exercise that had been undertaken to identify the 
products used for environmental protection.  The APEC process had been more systematic, and had 
involved a number of developing countries.  Recen tly, the OECD had studied the synergies between 
the two lists and found that many of the products  on both lists were used in the context of 
environmental services, which responded to the con cern that India had raised.  The study found that 
what often happened in the market-place was that, when environmental services were provided, local 
producers in developing countries started increasing their production of the associated environmental 
goods and, in some cases, even exporting them.  He reminded delegations that the OECD included 
three developing countries, Korea, Mexico and Turkey, and that its studies also contained a 
developing country perspective.   
112. New Zealand had provided the following definition of the environmental industry in its 
submission (which was the OECD definition):  "activities which produce goods and services to 
measure, prevent, limit, minimize or correct enviro nmental damage to water, air and soil, as well as 
problems relating to waste, noise and eco-systems. "  The OECD wondered how this broad definition 
could be characterized as either restrictive or regional.   
113. The representative of Venezuela  welcomed UNCTAD’s statement.  However, despite what 
had been stated by the OECD representative, he w as not convinced that the OECD definition of the 
environmental industry captured developing countr y interests.  It did not refer to sustainable 
development, and was unclear in its cover of the products of biological diversity, genetic resources, 
and energy.  Furthermore, it did not cover the human  genome, whose patenting Venezuela prohibited.  
OECD documents could not be treated as a fait accompli  by the CTESS. 
Requests for Secretariat Assistance and the Chairman's Concluding Remarks 
114. The representative of Hong Kong, China , supported by Australia  and the United States , asked 
the Secretariat to synthesize or compile the informat ion that was before the Committee, so that a more 
focussed and effective discussion could be  held.  The representative of Canada supported the idea that 
the Secretariat prepare a compilation of the environm ental goods lists that have been submitted to the 
CTESS to date, which could evolve as fu rther lists were developed.    TN/TE/R/11 
Page 20  
 
115. The representative of Egypt
 asked the Secretariat to compile data on Members' applied and 
bound tariff rates on the goods that had been submitt ed to the CTESS.  The representative of Korea  
did not believe that tariff statistics would help in  these negotiations.  Rather, of more use would be 
data on trade flows.  This could be made available by the Secretariat in its compilation of the various 
lists submitted by Members. 
116. The Chairman  stated that the Secretariat would prepare a document that would compile the 
key issues raised by Members in their submissi ons under Paragraph 31(iii), including on their various 
product categories and lists to the extent possible.  The Secretariat would also respond to the request 
for tariff data that had been made by Egypt.  Fu rthermore, he indicated that he would be holding 
informal consultations on the issue of technical assistance. 
IV. OTHER BUSINESS  
117. The representative of Qatar  signalled his intention to give a presentation at the next formal 
meeting of the CTESS on the Qatari proposal on natural gas, in order to assist Members in understanding its environmental merits.   
118. The representative of Japan
 suggested that the ad hoc invita tion to the International Tropical 
Timber Organization (ITTO) be renewed, but the representative of Malaysia  objected.  No consensus  
was reached on this matter.  
119. The Chairman  indicated that the ad hoc invitation to th e organizations that had been invited to 
this meeting7 would be renewed for the next formal m eeting of the Committee, which would take 
place on 7-8 July 2005. 
__________ 
                                                      
7 These organizations include: UNEP, UNCTAD, the World Customs Organization (WCO), the 
OECD, and the following seven MEAs:  The Basel Convention on the Control of Transboundary Movements of 
Hazardous Wastes and their Disposal (Basel Convention);  the Convention on Biological Diversity (CBD); 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);  the Rotterdam Convention on the 
Prior Informed Consent Procedure for Certain Hazardous Chemicals and Pestic ides in International Trade (PIC 
Convention); the Stockholm Convention on Persistent Organic Pollutants (POPs Convention); and the 
United Nations Framework Convention on Climate Change (UNFCCC).