- The Facts
6. The Atlanto Scandian herring is shared between the respective exclusive zones of five coastal States, namely the Faroe Islands, Iceland, Norway, the Russian Federation, and, to some extent, the European Union. Proper management, therefore, requires, consistent with the relevant provisions of UNCLOS, joint management and mutual efforts on the part of the relevant coastal States in order to seek to agree upon the measures necessary to coordinate and ensure the conservation and development of this shared stock.
7. The Faroe Islands has a strong record for managing the Atlanto Scandian herring in accordance with the requirements of the UNCLOS, ensuring, through proper conservation and management measures, that the maintenance of the stock is not endangered by over exploitation.
8. To that end, each year, the Faroe Islands and the other four coastal States undertake negotiations with a view to agreeing an allocation key for dividing the Total Allowable Catch ("TAC") recommended in advice from the International Council for the Exploration of the Sea ("ICES"), based on a fish mortality rate set pursuant to a long term management plan agreed between the five coastal States.
9. Unfortunately, the five coastal States were unable to agree on an allocation key for the TAC for Atlanto Scandian herring for 2013. On 26 March 2013, based on available scientific evidence, the Faroe Islands set a catch limit of 105 230 tonnes for the stock. The catch limit is determined as 17 per cent of the TAC recommended by ICES.
10. The Faroe Islands understands the position of the European Union to be that the Faroe Islands should restrict the exercise of its sovereign rights by setting its catch limit at 5.16 per cent of the TAC for Atlanto Scandian herring, which represents approximately 31 000 tonnes for 2013.
In a nutshell, the Faroe Islands, the EU and others couldn't agree on the proper Faroe Islands catch limit for herring. Therefore the Faroe Islands went ahead and set its own limit.
- The Measures
Here's how the EU responded to the Faroe Islands' decision to raise the catch limit:
11. In response to the Faroe Islands' decision to set a catch limit of 105 230 tonnes for Atlanto Scandian herring, the European Union has adopted coercive economic measures against the Faroe Islands. It has prohibited the introduction into the territory of the Union of certain products of Atlanto Scandian herring and Northeast Atlantic mackerel (Scomber scombrus) caught under the control of the Faroe Islands; and it has prohibited from EU ports any vessels flying the flag of the Faroe Islands that fish for Atlanto Scandian herring or mackerel and any vessels transporting fish or fish products stemming from Atlanto Scandian herring or mackerel that have been caught either by vessels flying the flag of the Faroe Islands or by other vessels authorized by the Faroe Islands while flying the flag of a third country.
The EU Regulation, with its own explanation of the situation, is here: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2013:223:0001:0007:EN:PDF
And here are the WTO obligations under which the Faroe Islands brought legal claim:
(a) Article I:1 of the GATT 1994, because ... the European Union fails to accord immediately and unconditionally to like products originating in the Faroe Islands relevant advantages, favours, privileges or immunities that are granted by the European Union to Atlanto Scandian herring and Northeast Atlantic mackerel products originating in other countries;
(b) Article V:2 of the GATT 1994, because ... the European Union denies freedom of transit through the territory of the European Union, and each of its Member States, via the routes most convenient for international transit, for traffic in transit to or from the territory of other WTO Members, and makes distinctions based on the flag of vessels, the place of origin, departure, entry, exit or destination or on circumstances relating to the ownership of goods, of vessels or of other means of transport; and,
(c) Article XI:1 of the GATT 1994, because ... the European Union institutes or maintains prohibitions or restrictions, other than duties, taxes or other charges, on the importation of certain products of the territory of the Faroe Islands.
It seems inevitable that we will end up in Article XX(g) and the chapeau, doesn't it? The key question would seem to be whether the EU actions constitute "arbitrary or unjustifiable discrimination between countries where the same conditions prevail, or a disguised restriction on international trade." This issue may revolve around the methodology for each side's determination of the appropriate catch level.
And finally, there is this:
2. The Faroe Islands is a self governing territory of the Kingdom of Denmark that falls within the territorial scope of the latter's acceptance of the Marrakesh Agreement Establishing the World Trade Organization ("WTO").
3. The Faroe Islands does not fall within the territorial scope of the European Union.
4. This request for consultations ("Request") is made by the Kingdom of Denmark in respect of the Faroe Islands.
What, if anything, does EU law have to say about an EU member country challenging the EU itself at the WTO?