In our YJIL article on the Seals dispute "Permitting Pluralism", Jo Langille and I argued that the TBT Agreement is not designed to apply to measures dealing with intrinsic moral principles of right and wrong; many of its provisions seem to address instrumental risk regulation, and the ordinary meaning of the word "technical" itself seems in tension with laws based significantly on ethical imperatives or commandments, and not just seeking some welfare goal. To take an obvious example, who would describe the prohibition of murder as "technical"? In our amicus Langille, Sykes and I didn't repeat that argument-though we did file the article as an exhibit. (Anyhow, Langille and I we also see instrumentalist aspects in the EU scheme, so our view doesn’t lead to complete non-applicability of TBT).
It turns out the issue of whether and in what aspects the EU seals scheme is a technical regulation has been very much on the mind of the Appellate Body. Of course the obvious reason is not our analysis but a more formal argument of the EU that may seem at times similar to the unsuccessful argument it made in Asbestos that a ban can’t be a technical regulation because it doesn’t describe any characteristic the product has to have in order to be allowed but rather it just keeps the identified product out altogether. However, the EU and the related US Third Participant argument is in fact considerably more subtle, though not always presented so nimbly by all of the EU’s attorneys. It is this: Asbestos can be distinguished because in Asbestos both the ban and the exceptions really focused on the harm that derives from the physical characteristics of asbestos and avoiding that harm. In Seals by contrast, what determines whether an identifiable product, i.e. anything containing seal, is permitted on the EU market, is not any characteristic of seal as a product, but the purpose and manner of the hunt (indigenous or marine management). Canada and Norway don't have a great response-they simply say that any measure that determines the access to the market of an identifiable product describes product characteristics. But if that were so then why mention PPMs separately at all in Annex I:1, much less distinguish product-related PPMs, since any measure that merely applies to an identifiable product would be describing product characteristics? Canada’s and Norway’s view is basically circular-it is a product characteristic of a seal product that it is seal.
AB Division Member Chang seems to be leading the charge in probing more deeply here, first of all echoing (of course entirely inadvertently and coincidentally) the Howse/Langille point that you may need to consider context and circumstances in deciding whether a measure in a technical regulation, not just reading formally and in a vacuum the language in Annex 1 of TBT. For example the major role for international standards in TBT, which seems at odds with it covering regulations dealing with the moral standards of individual societies: harmonizing morality globally doesn't seem like something that TBT should as such aim at-sounds like Anne Peters global constitutionalism gone amok-though in some areas like labor standards this might be a tempting progressive use of TBT. But Norway and Canada are really oblivious to the big issues in Prof Chang's mind-they don't see the normative stakes here and go back to parsing a couple of paragraphs from Asbestos
If, as it would seem, product characteristic and identifiable product have to mean different things, and the conditions for the entry of the identifiable product (seal) on the EU market, i.e. the purpose and manner of the hunt, are not product characteristics, then what are these conditions in TBT terms: product-related PPMs or non-product related PPMs or something else that TBT doesn’t really deal with at all?
AB Division Member Chang mooted the possibility that the AB could conceivably reverse the panel's finding on the applicability of TBT to the measure as a whole but complete the analysis through considering the conditions stated in the exceptions as product-related PPMs. At first Norway jumped on this possibility. But then in response to further questions they seemed to answer that in order to be a product-related PPM, a market access condition would have to relate to a product characteristic. Canada seemed more or less to agree. This is fatal to completing the analysis because the purpose and manner of the hunt are not characteristics of seal as a product in the narrow sense.
On the other hand, if as I have argued in numerous publications, product-related means just that the PPM must specify the market access conditions of an identifiable product (as opposed to something like physical product characteristics) then the AB might well be able to characterize the conditions stated in the IC and MRM exceptions as product-related PPMs. My point has been that the reason TBT is limited to PPMs that are product-related in the sense of related to an identifiable traded product is that because TBT applies to trade in goods, the product-related language is needed to exclude PPMs not directly concerning trade in goods, i.e. PPMs that are services-a consulting engineer’s design for an assembly line or IP such as a process patent. These need to be dealt with under other covered agreements to the extent that the trade issue is not market access to goods.
Before Norway looked the gift horse in the mouth, as it were, the EU-understanding better than
Norway what the AB might have up its sleeve-strenuously objected to the AB completing the analysis by means of considering the conditions in the exceptions as product-related PPMs. The EU had, in reality, two arguments.
The first was that such a characterization would require findings of fact about the measure that were never made by the panel (because the issue of product-related versus non product-related PPMs was never really vetted or briefed before it).
The division pressed: What facts? Isn't it enough to look at the measure on the record to decide on whether the right legal characterization of the conditions for market access of the identifiable product (seal) is product-related PPMs or not? Though I am rooting for the EU in this case-that's obvious-I have to say I don't think they are on the most firm arguing that the AB should not complete the analysis because the factual record doesn’t allow it. In US-Tuna II the AB already more or less implicitly accepted that product-related need not relate to physical characteristics. Some people think that in Tuna II, the AB simply relied on the second sentence of the definitional paragraph of Annex I, which appears to read so as to suggest that PPMs concerning labeling requirements do not need to be related to products in order to be covered by TBT. But in fact the AB never invoked that second sentence in this way. And the reason is that it didn’t have to, since the US measure in Tuna II was a product-related PPM within the meaning of the first sentence, i.e. the PPM-“dolphin-safe”-applied to an identifiable traded product, tuna. Contrary to what is often presented as the conventional wisdom, the PPM didn’t have to relate to the physical or directed connected characteristics of tuna as a product to count as a product-related PPM according to the AB.
This brings me to the EU's other point-due process, the fact that the question was not argued or briefed seriously, is an important one and raises systemic, institutional issues. The debate over PPMs and their meaning has been one of the most divisive in the history of the WTO. Deciding explicitly that product-related means not related to physical or directly connected characteristics of a product is intellectually the right answer. But deciding it explicitly in a case where the issue and all its normative and systemic implications have not been briefed at the panel stage, or even by Participants and Third Participants in their appellate submissions, is questionable. Wouldn't a lot more countries-India comes to mind, perhaps-have been Third Participants in this appeal if they thought the AB was going to make the jurisprudence on whether a PPM has to concern or relate to physical characteristics of a product in order to be product-related? But I am on the fence about this. If you have an AB that is a real high court, and a Division here that seems to have the intellect and judgment you would expect of a high court, then why should it be disconcerting that they have the confidence to make jurisprudence in this rather constitutionalist fashion, i.e. based on what the judges see as the right answer in principle, even if not thoroughly litigated by the parties?
Well there is a way to avoid this mega-institutional issue. Canada and Norway don’t want to accept that the relevant aspects of the EU scheme are product-related PPMs (because they see product-related as having to do with product characteristics), they thus have basically told the AB that they don't want it to complete the analysis in this way, and the EU for its own reasons doesn't want the AB to complete the analysis here. So the AB could simply say that since completing the analysis is discretionary and no party wants it based on the product-related PPMs theory, we can feel free simply to reverse the panel finding concerning the applicability of TBT. This would turn the case into a GATT case exclusively, and thus present the AB with a much more manageable set of issues: for example how you view public morals under TBT would not need to be decided. In sum, the parties ought to be thinking hard over the next 2 says about what it would mean if the AB were to decide that the panel was wrong that TBT applies. One issue is that a number of crucial factual findings including those that relate closely to legal issues, were simply transposed by the panel from its TBT analysis to the GATT part of the claim. The panel really seemed to think it had done the heavy lifting on even-handedness for instance under 2.1 and the GATT analysis under I:1 and III:4 seems cursory at best (it doesn’t in some respects even meet the objective assessment threshold-see our amicus). So what happens now, when it turns out that the primary findings on even-handedness were based on the part of the judgment that derived from a mischaracterization of the measure as a technical regulation? I think here the complaining parties may have hoisted themselves by their own petard-by attacking so many of the factual findings of the panel as failing the objective assessment test, they could not really have a grievance if the AB were to throw out the findings of GATT violation as unable to stand on their own two feet, once the panel’s TBT findings have been reversed or found to be on no legal effect, because it was wrong that TBT applied in the first place.
But what if the AB were to complete the analysis on TBT by finding the conditions of market access (that the seal product come from an indigenous or marine management hunt) to be product-related PPMs? From some of the questions of the Division yesterday it seems like they might well focus on certain aspects of the administration or enforcement or application of these PPMs-conformity assessment-related matters. That’s the subject of my next post on yesterday’s session, coming very soon. There I'll also deal with some of the opening statements that were read in the morning yesterday.