Distributive justice and world trade law a political theory of international trade regulation

Books in the series Distributive Justice and World Trade Law: A Political Theory of International Trade Regulation Establishing Judicial Authority in International Economic Law Edited by

W O R L D T R A D E L A W

What does justice demand in international trade regulation? And how far does WTO law respond to those demands? Whether our focus is developing countries, struggling industries, or environmental protection, distributive conflict is a pervasive feature of international economic law Despite this, we lack an adequate theory of distributive justice for this domain Drawing on philosophical approaches to global justice, this book advances a novel theory of justice in trade regulation, and applies this to explain and critique the law of the WTO Integrating theoretical and doctrinal approaches, it demonstrates the potential for political theory to illuminate and inform the progressive development of WTO law, including rules on border measures, discrimination, trade remedies, and domestic regulation Written from an interdisciplinary perspective, accessible to lawyers, philosophers, and political scientists, the book will appeal both to theorists interested in building bridges from theory to practice and to practitioners seeking new perspectives on existing problems.

o i s i n s u t t l e is a Lecturer at Queen’s University, Belfast, having previously taught at the University of Sheffield and University College London He teaches political philosophy, public international law and WTO law He holds degrees in law (University College Dublin) and international relations (University of Oxford), and a PhD on the philoso- phy of international economic law (University College London) His research has been published in leading international journals, including the European Journal of International Law, the Modern Law Review, and the Journal of International Law and International Relations He formerly practiced commercial law and is qualified both in Ireland and in England and Wales.

Series editors

Dr Lorand Bartels, University of Cambridge

Professor Thomas Cottier, University of Berne

Professor William Davey, University of Illinois

As the processes of regionalization and globalization have intensified, there have been accompanying increases in the regulations of interna- tional trade and economic law at the levels of international, regional, and national laws.

The subject matter of this series is international economic law Its core

is the regulation of international trade, investment, and cognate areas such as intellectual property and competition policy The series publishes books on related regulatory areas, in particular, human rights, labor, environment and culture, as well as sustainable development These areas are vertically linked at the international, regional, and national level, and the series extends to the implementation of these rules at these different levels The series also includes works on governance, deal- ing with the structure and operation of related international organizations

in the field of international economic law, and the way they interact with other subjects of international and national law.

Books in the series Distributive Justice and World Trade Law: A Political Theory of

International Trade Regulation

Establishing Judicial Authority in International Economic Law

Edited by Joanna Jemielniak, Laura Nielsen, and Henrik Palmer Olsen Trade, Investment, Innovation and Their Impact on Access to Medicines:

An Asian Perspective

Locknie Hsu

The Law, Economics and Politics of International Standardisation

Panagiotis Delimatsis

General Interests of Host States in International Investment Law

Edited by Giorgio Sacerdoti, Pia Acconci, Mara Valenti and Anna De Luca The Law of Development Cooperation: A Comparative Analysis of the World Bank, the EU and Germany

African Regional Trade Agreements as Legal Regimes

James Thuo Gathii

Liberalizing International Trade after Doha

David Gantz

Processes and Production Methods (PPMs) in WTO Law: Interfacing Trade and Social Goals

Christiane R Conrad

D I S T R I B U T I V E J U S T I C E

A N D W O R L D T R A D E L A W

A Political Theory of International Trade Regulation

O I S I N S U T T L E

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It furthers the University ’s mission by disseminating knowledge in the pursuit of education, learning, and research at the highest international levels of excellence.

www.cambridge.org Information on this title: www.cambridge.org/9781108415811

DOI: 10.1017/9781108235235

© Oisin Suttle 2018 This publication is in copyright Subject to statutory exception

and to the provisions of relevant collective licensing agreements,

no reproduction of any part may take place without the written

permission of Cambridge University Press.

First published 2018 Printed in the United Kingdom by Clays, St Ives plc

A catalogue record for this publication is available from the British Library.

Library of Congress Cataloging-in-Publication Data

Names: Suttle, Oisin, 1980 – author.

Title: Distributive justice and world trade law : a political theory of international

trade regulation / Oisin Suttle.

Description: Cambridge [UK] ; New York : Cambridge University Press, 2017 | Series:

Cambridge international trade and economic law ; 36 | Includes

bibliographical references and index.

Identi fiers: LCCN 2017030746 | ISBN 9781108415811 (hardback)

Subjects: LCSH: Foreign trade regulation | World Trade Organization | Distributive

justice | Foreign trade regulation – Political aspects | Free trade.

Classi fication: LCC K3943 S89 2017 | DDC 343.08/7–dc23

LC record available at https://lccn.loc.gov/2017030746

ISBN 978-1-108-41581-1 Hardback Cambridge University Press has no responsibility for the persistence or accuracy of URLs for external or third-party internet websites referred to in this publication and does not guarantee that any content on such websites is, or will remain

accurate or appropriate.

Preface pagexv

Table of Cases xix

Table of Treaties, Instruments and Official

Documents xxviii

List of Abbreviations xxxi

P A R T I Foundations 1

1 Introduction 3

1.1 Distributive Justice in International Trade 3

1.2 Why Trade Law Needs a Theory of

1.6 Equality in Global Commerce 19

1.6.1 Two Classes of Measure 19

1.6.2 Identifying Measures 22

1.6.3 Equality in Global Commerce 25

2 Why World Trade Law Needs a Theory of Justice 28

2.1 The Problem of Distributive Justice in InternationalTrade Regulation 28

2.2 Distributive Justice and Political Morality 30

vii

2.3 On the Scope of Justice: Domestic vs International vs.

3.3 Coercion and the Plurality of Global

4.2 Sovereignty, Security, and Global Justice 119

4.2.1 Sovereignty and Security 120

4.2.2 Sovereignty and Coordination 122

4.3 Sovereignty and the Basic Structure 123

4.3.1 Why the Basic Structure? 124

4.3.2 The Impact Objection 127

4.3.3 The Participation Objection 129

4.3.4 The Agency Objection 131

4.4 National Priority and Global Justice 134

4.5 Further Statist Objections 141

4.5.1 The Metric Problem 142

4.5.2 The Dynamic Problem 146

4.6 Conclusion 149

5 Self-Determination and External Trade

6.2.3 EGC: Expressing Justice 185

6.3 The Problem of Discrimination 188

6.3.1 The Ambiguity of Discrimination 190

6.3.2 Three Approaches to Likeness 191

6.3.3 The Contradictions of PT and TTT 194

6.3.4 Reconstructing Nondiscrimination through

6.3.5 Discrimination and Technical

Regulations 202

6.4 Conclusion 203

7 Justifying ETMs: Development Provisions and General

7.3.2 EGC and the General Exceptions 227

7.3.3 EGC in the Article XX

8.3.3 Safeguards 263

8.3.4 Dumping 268

8.4 EGC and Interpretation of Trade Remedies

8.4.1 Subsidies and Benefit 273

8.4.2 Safeguards, Foreseeability, and

9.2.3 Equality in Global Commerce 294

9.2.4 Adjudicating the Approaches 298

9.3 TBT and Legitimate Objectives 298

9.4 SPS and the Authority of Science 305

9.5 International Standards 314

9.6 Conclusion 319

P A R T I V Progress 321

10 Conclusion: Where to from Here? 323

10.1 Where Do We Go from Here? From Deadlock toVariable Geometry 323

10.2 Where Do I Go from Here? Extending the

10.3 Where Do You Go from Here? On the Value of

Interdisciplinarity 334

Bibliography 336

It is a strange time to be thinking about justice and fairness in the governed global economy.

rule-I first became conscious of global politics in the 1990s, during thatoptimistic post-Cold War, pre-9/11, liberal internationalist moment that

we were told was to be history’s end state That moment produced theWTO, but also the International Criminal Court, the Maastricht Treaty,the Millennium Development Goals, and a general sense that nations andnationalism were becoming a bit passé When I began thinking seriouslyabout international economic governance in the mid-2000s, the maincriticisms of the trade system came from environmentalists, humanrights activists, and advocates for the Global South Nobody imaginedthat the trade regime was perfect: the debacle in Seattle made that clear.But the biggest challenge was that the trade rules were insufficientlycosmopolitan, preferring the interests of rich countries and industriesover the globally most vulnerable

Those days are over In the months when I wasfinishing this book, twovotes happened that made that eminently clear: the UK referendum onleaving the European Union; and Donald Trump’s election as president

of the United States Whatever else these two votes mean, they signal

a reassertion of economic nationalism in two countries that, over twocenturies, have done most to advance an open international economicorder The political sentiments they express are a reminder of somethingthat liberal economists know well, but often neglect to mention: thatwhile trade may benefit countries as a whole, its costs and benefits areunevenly spread They represent a demand, on the part of those who seethemselves as losing out from globalization, to have their pain recognizedand their interests accommodated, even if this means shifting that painonto someone else They are, in consequence, a rejection of many eco-nomic shibboleths on which the postwar– and especially the post-ColdWar– liberal economic order was built And in both the United Kingdomand the United States, they have brought to power governments

xv

unashamedly committed to advancing their national interests, above all,

in international economic governance

However, they are more than that This is not just a reassertion of theinterests of particular groups Rather, in the rhetoric of “Take BackControl” and “Make America Great Again,” there is a substantial nor-mative component There is a sense that aggrieved groups have beensacrificed unfairly, whether for the benefit of domestic elites, immigrants,

or foreign economies The antiglobalization rhetoric is one of fairness,and of sovereign rights, rather than purely of self-interest It is not justthat foreign manufacturers, or immigrants, or liberal elites, are doingwell, but that they are cheating, or taking advantage, or otherwise gettingmore than they should These are political rallying calls, but they are alsosomething more They are claims of political morality And as claims ofpolitical morality, we can and should look for ways to evaluate them.This book is an attempt to answer some of the fundamental questionsthat these kinds of claims raise What exactly does it mean to say thatinternational trade regulation is unfair, or unjust? In a world of indepen-dent states, where is the line between those things a state can permissibly

do, even if this has effects on outsiders, and those that constitute wrongs

to those outsiders? How should states reconcile the claims of their owncitizens, including especially those least well-off, with the demands ofoutsiders with whom they do, or might, economically interact? And howfar does the existing trade regime correctly answer these questions? Fortoo long, the liberal international economic order assumed it was legit-imized by an economic theory that showed international trade was ineveryone’s interests As that assumption is challenged, it becomes moreurgent directly to address the questions of distributive conflict anddistributive justice that it obscured It is precisely when liberal interna-tionalism is going out of fashion that we must look again at the argu-ments that might support it

I have not sought to engage directly with these recent political opments This is not that kind of book It may, in consequence, seem

devel-a little old-fdevel-ashioned, devel-a throwbdevel-ack to the optimistic ddevel-ays of the 1990s, oreven the 1960s However, it is motivated by a set of ideas that remaincentral to political discourse across many countries: that persons are freeand equal; that the exercise of power requires to be justified to those overwhom it is exercised; that peoples have rights to equality and self-determination These are the ideals of the United States Declaration ofIndependence; of the Universal Declaration of Human Rights and thetwo International Covenants; and of the liberal tradition that, in

European and American thought, runs from Hobbes and Locke throughKant and Mill to constitute the dominant position in contemporarypolitical thought While today we may find these ideas invoked tomotivate policies quite contrary to those with which they were formerlyassociated, they remain thefirmest ground from which to build a sharedpolitical morality Their meaning may not befixed and eternal, but it alsodoes not change with each shift in the political winds We can thusexamine what taking them seriously in the context of internationaleconomic governance would mean, without worrying overly whetherour conclusionsfit the political fashions of the moment These liberalideas will, I am confident, outlive our present reactionary moment I hopethis book might also.

Writing this book has been a journey I have incurred many debts alongthe way

Myfirst and greatest academic debts are to Professor John Tasioulas andProfessor Fiona Smith, who supervised my PhD at University CollegeLondon, on which this book is based The hours they spent reading anddiscussing drafts, and pressing me to clarify and strengthen my arguments,were crucial in turning a vague concern with global economic governanceinto the work here presented I came to this project with training in law andpolitical science, but relatively little experience of either philosophy orinternational trade law I benefited enormously from having experts inboth to guide me as I took myfirst steps as a scholar at this interdisciplinaryboundary I also benefited greatly from comments of my PhD examiners,Professors John Linarelli and Joanne Scott

Ifirst became interested in problems of fairness in global governancewhile completing a master’s degree in international relations at theUniversity of Oxford My supervisor there, Professor KalypsoNicolaidis, encouraged my research interests in economic governanceand the trade regime, and has been a continuing source of encourage-ment ever since I am also grateful to Professor Jennifer Welsh, whofirstintroduced me to international political theory; many of the questions

I try to answer in this book are ones Ifirst asked in her seminars.During the years of their gestation, the ideas herein benefited fromconversations with colleagues too numerous to name The Faculty ofLaws at UCL, and particularly the community of graduate studentsworking there, provided the perfect environment in which to develop

my ideas; it took leaving to realize how unique that community was.The Political Philosophy Working Group at UCL provided a valuable

source of interdisciplinary conversations After leaving UCL, colleagues

at the University of Sheffield provided a frequent sounding board as

I continued to develop my views

I received valuable comments from participants at various conferencesand workshops where I presented parts of the argument, including:Northeastern University Workshop in Applied Philosophy,September 2012; American Society for International Law InternationalEconomic Law Interest Group Biennial Meeting, George WashingtonUniversity, December 2012; Brave New World, University of ManchesterDepartment of Political Theory, June 2013; British Institute ofInternational and Comparative Law Annual Conference on WTO Law,May 2014; University College Dublin Workshop on WTO Law,May 2014; Junior Faculty Forum for International Law, EuropeanUniversity Institute, June 2015

Two papers presenting parts of my argument have been previouslypublished A shorter version of parts ofChapter 3appeared as“Equality

in Global Commerce: Towards a Political Theory of InternationalEconomic Law” (2014) European Journal of International Law 25(4)1043–1070 Parts ofChapters 5and7are included in abridged form in

“What Sorts of Things Are Public Morals? A Liberal CosmopolitanAccount of Article XX GATT” (2017) Modern Law Review 80(4)569–599 I am grateful to reviewers and editors of both journals fortheir comments, which improved those papers, but also informed othersections of this book An EJIL:Live! interview with Professor JosephWeiler discussing thefirst of these papers was another valuable source

of feedback

Financial support was provided by a UCL Faculty of Laws ResearchScholarship Revisions to the manuscript were completed duringresearch leave from the University of Sheffield School of Law.University College Dublin School of Law kindly hosted me while I wasfinalizing the manuscript

Finally, I am grateful to friends and family for support and ment I owe particular thanks to my wife Maeve Bateman: for encoura-ging me to take the leap in beginning this project; for patiently enduringcountless evenings and weekends when writing took precedence over allelse; for keeping smiling and keeping me smiling through the crises ofconfidence that will be familiar to anyone who has undertaken a majorpiece of writing; and for constantly reminding me that there are moreimportant things in life than getting that last footnote just right

encourage-GATT Dispute Settlement Reports

Short Title Full Citation

Belgium – Family

Allowances

Belgian Family Allowances (Allocations Familiales), G/

32, circulated November 6, 1952, adopted November

7, 1952, BISD 1S/59 EEC – Bananas I EEC Member States’ Import Regime for Bananas, DS32/

R, circulated June 3, 1993, unadopted EEC – Bananas II EEC – Import Regime for Bananas, DS38/R, circulated

February 1994, unadopted EEC – Apples I (Chile) EEC Restrictions on Imports of Apples from Chile, L/

5047, circulated October 31, 1980, adopted November 10, 1980, BISD 27S/98

EEC – Dessert Apples

Complaint by Brazil, L/5011, circulated October 7,

1980, adopted November 10, 1980, BISD 27S/69 Japan – Alcohol I Japan – Customs Duties, Taxes and Labelling Practices

on Imported Wines and Alcoholic Beverages, L/6216, circulated October 13, 1987, adopted November 10,

1987, BISD 34S/83 Norway – Textiles Norway – Restrictions on Imports of Certain Textile

Products, L/4959, circulated March 24, 1980, adopted June 18, 1980, BISD 27S/119

xix

Short Title Full Citation

Spain – Unroasted

Coffee

Spain – Tariff Treatment of Unroasted Coffee, L/5135, circulated April 27, 1981, adopted June 11, 1981, BISD 28S/102

US – Autos United States – Taxes on Automobiles, DS31/R,

circulated October 11, 1994, unadopted

US – Malt Beverages United States – Measures Affecting Alcoholic and Malt

Beverages, DS23/R, circulated March 16, 1992, adopted June 19, 1992, BISD 39S/206

US – Section 337 United States Section 337 of the Tariff Act of 1930, L/

6439, circulated January 16, 1989, adopted November

7, 1989, BISD 36S/345

US – Tuna (Mexico) United States – Restrictions on Imports of Tuna, DS21/R,

circulated September 3, 1991, unadopted, BISD 39S/155

US – Tuna (EEC) United States – Restrictions on Imports of Tuna, DS29/R,

circulated June 16, 1994, unadopted

WTO Dispute Settlement Reports

Short Title Full Citation

Argentina – Hides and

Leather

DS155 Argentina – Measures Affecting the Export of Bovine Hides and Import of Finished Leather Panel Report December 19, 2000, WT/DS155/R Argentina – Preserved

Short Title Full Citation

Appellate Body Report October 20, 1998, WT/DS18/ AB/R

Article 21.5 Panel Report February 18, 2000, WT/ DS18/RW

Brazil – Aircraft DS46 Brazil – Export Financing Programme for Aircraft

Panel Report April 14, 1999, WT/DS46/R Brazil – Tyres DS332 Brazil – Measures Affecting Imports of Retreaded

Tyres Panel Report June 12, 2007, WT/DS332/R Appellate Body Report December 3, 2007, WT/DS332/ AB/R

Canada – Aircraft DS70 Canada – Measures Affecting the Export of

Civilian Aircraft Appellate Body Report August 2, 1999, WT/DS70/AB/R Canada – FIT DS426 Canada – Measures relating to the Feed-in Tariff

Program Panel Report December 19, 2012, WT/DS426/R Appellate Body Report May 6, 2013, WT/DS426/AB/R Canada – Periodicals DS31 Canada – Certain Measures concerning Periodicals

Appellate Body Report June 30, 1997, WT/DS31/AB/R Canada –

Distribution Services for Certain Publications and Audiovisual Entertainment Products

Panel Report August 12, 2009, WT/DS363/R Appellate Body Report December 21, 2009, WT/DS363/ AB/R

China – Rare Earths DS431 China – Measures Related to the Exportation of

Rare Earths, Tungsten and Molybdenum Panel Report March 26, 2014, WT/DS431/R Appellate Body Report August 7, 2014, WT/DS431/ AB/R

China – Raw Materials DS394 China – Measures Related to the Exportation of

Various Raw Materials

Short Title Full Citation

Panel Report July 5, 2011, WT/DS394/R Appellate Body Report January 30, 2012, WT/DS394/ AB/R

Dominican Republic –

Cigarettes

DS302 Dominican Republic – Measures Affecting the Importation and Internal Sale of Cigarettes Appellate Body Report April 25, 2005, WT/DS302/ AB/R

EC – Aircraft DS316 – European Communities – Measures Affecting

Trade in Large Civil Aircraft Panel Report June 30, 2010, WT/DS302/R Appellate Body Report May 18, 2011, WT/DS316/AB/R

EC – Asbestos DS135 European Communities – Measures Affecting

Asbestos and Products Containing Asbestos Appellate Body Report March 12, 2001, WT/DS135/ AB/R

EC – Fasteners DS397 European Communities – Definitive

Anti-Dumping Measures on Certain Iron or Steel Fasteners from China

Appellate Body Report July 15, 2011, WT/DS397/AB/R

EC – Hormones DS26 European Communities – Measures Concerning

Meat and Meat Products (Hormones) Appellate Body Report January 16, 1998, WT/DS26/ AB/R

EC – Sardines DS231 European Communities – Trade Description of

Sardines Panel Report May 29, 2002, WT/DS231/R Appellate Body Report October 23, 2002, WT/DS231/ AB/R

EC – Seal Products DS400 European Communities – Measures Prohibiting

the Importation and Marketing of Seal Products Panel Report November 25, 2013, WT/DS400/R Appellate Body Report May 22, 2014, WT/DS400/AB/R

EC – Tariff Preferences DS246 European Communities – Conditions for the

Granting of Tariff Preferences to Developing Countries Panel Report December 1, 2003, WT/DS246/R Appellate Body Report April 7, 2004, WT/DS246/AB/R India – Quantitative

Restrictions

DS90 India – Quantitative Restrictions on Imports of Agricultural, Textile and Industrial Products

Short Title Full Citation

Panel Report April 6, 1999, WT/DS90/R Appellate Body Report August 23, 1999, WT/DS90/ AB/R

India – Solar Cells DS456 India – Certain Measures Relating to Solar Cells

and Solar Modules Appellate Body Report September 16, 2016, WT/ DS456/AB/R

Japan – Alcohol II DS8 Japan – Taxes on Alcoholic Beverages

Panel Report July 11, 1996, WT/DS8/R Appellate Body Report October 4, 1996, WT/DS8/AB/R Japan – Apples DS245 Japan – Measures Affecting the Importation of

Apples Panel Report July 15, 2003, WT/DS245/R Appellate Body report November 26, 2003, WT/DS245/ AB/R

Japan – Varietals DS76 Japan – Measures Affecting Agricultural Products

Appellate Body Report February 22, 1999, WT/DS76/ AB/R

Korea – Alcoholic

Beverages

DS75 Korea – Taxes on Alcoholic Beverages Appellate Body Report January 18, 1999, WT/DS75/ AB/R

Korea – Beef DS161 Korea – Measures Affecting Imports of Fresh,

Chilled and Frozen Beef Appellate Body Report December 11, 2000, WT/DS161/ AB/R

Mexico – Olive Oil DS341 Mexico – Definitive Countervailing Measures on

Olive Oil from the European Communities Panel Report September 4, 2008, WT/DS341/R Mexico – Soft Drinks DS308 Mexico – Tax Measures on Soft Drinks and Other

Beverages

Short Title Full Citation

Appellate Body Report March 6, 2006, WT/DS308/ AB/R

Philippines – Distilled

Spirits

DS396 Philippines – Taxes on Distilled Spirits, Appellate Body Report December 21, 2011, WT/DS396/ AB/R

US – ADCVD(China) DS379 United States – Definitive Anti-Dumping and

Countervailing Duties on Certain Products from China,

Appellate Body Report March 11, 2011, WT/DS379/ AB/R

US – Aircraft DS353 United States – Measures Affecting Trade in Large

Civil Aircraft – Second Complaint, Panel Report March 31, 2011, WT/DS353/R

US – Carbon Steel

(India)

DS436 United States – Countervailing Measures on Certain Hot-Rolled Carbon Steel Flat Products from India

Appellate Body Report December 8, 2014, WT/DS436/ AB/R

US – Clove Cigarettes DS406 United States – Measures Affecting the

Production and Sale of Clove Cigarette, Panel Report September 2, 2011, WT/DS406/R Appellate Body Report April 2, 2012, WT/DS406/AB/R

US – Continued

Suspension

DS320 United States – Continued Suspension of Obligations in the EC – Hormones Dispute Panel Report March 31, 2008, WT/DS320/R Appellate Body Report October 16, 2008, WT/DS320/ AB/R

US – COOL DS384 United States – Certain Country of Origin

Labelling (COOL) Requirements Panel Report November 18, 2011, WT/DS384/R Appellate Body Report June 29, 2012, WT/DS384/AB/R

US – Continued Zeroing DS350 United States – Continued Existence and

Application of Zeroing Methodology Appellate Body Report February 4, 2009, WT/DS350/ AB/R

US – FSC DS108 United States – Tax Treatment for “Foreign Sales

Corporations”

Short Title Full Citation

Appellate Body Report February 24, 2000, WT/DS108/ AB/R

US – Gambling DS285 United States – Measures Affecting the

Cross-Border Supply of Gambling and Betting Services Panel Report November 10, 2004, WT/DS285/R Appellate Body Report April 7, 2005, WT/DS285/AB/R

US – Gasoline DS2 United States – Standards for Reformulated and

Conventional Gasoline Panel Report 29 January 1996, WT/DS2/R Appellate Body Report April 29, 1996, WT/DS2/AB/R

US – Hot Rolled Steel DS184 United States – Anti-Dumping Measures on

Certain Hot-Rolled Steel Products from Japan Appellate Body Report July 24, 2001, WT/DS184/AB/R

US – Lamb DS177 United States – Safeguard Measure on Imports of

Fresh, Chilled or Frozen Lamb from New Zealand Appellate Body Report May 1, 2001, WT/DS177/AB/R

US – Lead Bismuth DS138 United States – Imposition of Countervailing

Duties on Certain Hot-Rolled Lead and Bismuth Carbon Steel Products Originating in the United Kingdom

Panel Report December 23, 1999, WT/DS138/R Appellate Body Report May 10, 2000, WT/DS138/AB/R

US – Line Pipe DS202 United States – Definitive Safeguard Measures on

Imports of Circular Welded Carbon Quality Line Pipe from Korea

Appellate Body report February 15, 2002, WT/DS202/ AB/R

US – Poultry (China) DS392 United States – Certain Measures Affecting

Imports of Poultry from China Panel Report September 29, 2010, WT/DS392/R

US – Shrimp DS58 United States – Import Prohibition of Certain

Shrimp and Shrimp Products Panel Report May 15, 1998, WT/DS58/R Appellate Body Report October 12, 1998, WT/DS58/ AB/R

Article 21.5 Appellate Body Report October 22, 2001, WT/DS58/AB/RW

Short Title Full Citation

US – Softwood

Lumber IV

DS257 United States – Final Countervailing Duty Determination with respect to certain Softwood Lumber from Canada

Panel Report August 29, 2003, WT/DS257/R Appellate Body Report January 19, 2004, WT/DS257/ AB/R

Article 21.5 Appellate Body Report August 15, 2006, WT/DS264/AB/RW

US – Steel Safeguards DS248 United States – Definitive Safeguard Measures on

Imports of Certain Steel Products Panel Report July 11, 2003, WT/DS248/R

US – Tuna II DS381 United States – Measures Concerning the

Importation, Marketing and Sale of Tuna and Tuna Products

Panel report September 15, 2011, WT/DS381/R Appellate Body Report May 16, 2012, WT/DS381/AB/R

US – Upland Cotton DS267 United States – Subsidies on Upland Cotton

Panel Report September 8, 2004, WT/DS267/R Appellate Body Report March 3, 2005, WT/DS267/ AB/R

US – Wheat Gluten DS166 United States – Definitive Safeguard Measures on

Imports of Wheat Gluten from the European Communities

Appellate Body Report December 22, 2000, WT/DS166/ AB/R

US – Zeroing (Japan) DS322 United States – Measures Relating to Zeroing and

Sunset Reviews Appellate Body Report January 9, 2007, WT/DS322/ AB/R

Short Title Full Citation

US – Zeroing (EC) DS294 United States – Laws, Regulations and

Methodology for Calculating Dumping Margins (Zeroing)

Appellate Body Report April 18, 2006, WT/DS294/ AB/R

GATT/WTO TreatiesGeneral Agreement on Tariffs and Trade of October 30, 1947, No.814, 55 U.N.T.S 194 (GATT 1947)

Marrakesh Agreement Establishing the World Trade Organization of April 15, 1994, No.

31874, 1867 U.N.T.S 14 (WTO Agreement)

General Agreement on Tariffs and Trade 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A (GATT or GATT 1994)

Agreement on Agriculture, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A (AoA)

Agreement on the Application of Sanitary and Phytosanitary Measures, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A (SPS)

Agreement on Technical Barriers to Trade, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A (TBT)

Agreement on Implementation of Article VI of the General Agreements on Tariffs and Trade 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A (ADA)

Agreement on Subsidies and Countervailing Measures, Marrakesh Agreement

Establishing the World Trade Organization, Annex 1A (SCM)

Agreement on Safeguards, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A (SA)

Understanding on Rules and Procedures Governing the Settlement of Disputes, Marrakesh Agreement Establishing the World Trade Organization, Annex 2 (DSU)

Other TreatiesInternational Covenant on Civil and Political Rights, of December 16, 1966, No 14668,

GATT/WTO DocumentsL/3464 Report by the Working Party on Border Tax Adjustments of December 2, 1970 L/4903 GATT Decision Differential and More Favourable Treatment Reciprocity and Fuller Participation of Developing Countries of November 28, 1979 (the Enabling Clause)

WT/L/304 General Council Decision on Waiver: Preferential Tariff Treatment for Developed Countries of June 15, 1999

Least-WT/MIN(01)/17 Doha Ministerial Decision on Implementation-Related Issues and Concerns of November 20, 2001

WT/MIN(01)/DEC/1 Doha Ministerial Declaration of November 20, 2001

WT/MIN(01)/DEC/2 Declaration on the TRIPS Agreement and Public Health, November 20, 2001

WT/L/540 General Council Decision on Implementation of Paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health, August 30, 2003

WT/L/579 General Council Decision on the Doha Work Programme, August 1, 2004 WT/MIN(05)/DEC Hong Kong Ministerial Declaration of December 18, 2005 WT/l/754 General Council Decision: United States – African Growth and Opportunity Act of May 27, 2009

WT/L/759 General Council Decision on Extension of Waiver: Preferential Tariff Treatment for Least-Developed Countries of May 27, 2009

TN/RL/24 Negotiating Group on Rules, Report by the Chairman, March 22, 2010 WT/MIN(13)/38, Bali Ministerial Decision on Public Stockholding for Food Security Purposes, December 7, 2013

TN/RL/W/255 Negotiating Group on Rules, Report by the Chairman, March 14, 2014 WT/MIN(15)/DEC, Nairobi Ministerial Declaration, December 21, 2015, para 32 WT/MIN(15)/44-WT/L/979 Nairobi Ministerial Decision on Public Stockholding for Food Security Purposes, December 21, 2015

WT/MIN(15)/45-WT/L/980 Nairobi Ministerial Decision on Export Competition, December 21, 2015

United Nations DocumentsE/CONF.46/3 United Nations Conference on Trade and Development (1964) Towards

a New Trade Policy for Development: Report by the Secretary-General of the United Nations Conference on Trade and Development

A/RES/25/2625 – United Nations General Assembly (1970) Resolution 2625 (XXV) Declaration on Principles of International Law concerning Friendly Relations and Cooperation among States in accordance with the Charter of the United Nations

UN Human Rights Committee (HRC), CCPR General Comment No 12: Article 1 (Right

to Self-determination), The Right to Self-determination of Peoples, March 13, 1984 A/RES/60/1 – United Nations General Assembly (2005) Resolution 60/1/2005, 2005 World Summit Outcome

UNCTAD/ITCD/TSB/Misc.25/Rev – United Nations Conference on Trade and Development (2008) Generalized System of Preferences: Handbook on the Scheme of the European Community

UNCTAD/ITCD/TSB/Misc.58/Rev.2 – United Nations Conference on Trade and Development (2010) Generalized System of Preferences: Handbook on the Scheme of the United States of America

UNCTAD/ITCD/TSB/Misc.42/Rev.4 – United Nations Conference on Trade and Development (2011) Generalized System of Preferences: Handbook on the Scheme of Japan

UNCTAD/ITCD/TSB/Misc.62/Rev.5 – United Nations Conference on Trade and Development (2014) Generalized System of Preferences: List of Beneficiaries

Other Official DocumentsReport of the International Commission on Intervention and State Sovereignty (2001) The Responsibility to Protect: Report of the International Commission on Intervention and State Sovereignty: International Development Research Centre

Regulation (EC) 1007/2009 of the European Parliament and of the Council of 16 September 2009 on trade in seal products [2009] OJ L286/36

ADA Agreement on Implementation of Article VI of the General Agreement

on Tariffs and Trade 1994 (Anti-Dumping Agreement)

DDE Doctrine of Double Effect

DSU Understanding on Rules and Procedures Governing the Settlement of

Disputes

EGC Equality in Global Commerce

GATT General Agreement on Tariffs and Trade

GATS General Agreement on Trade in Services

ICCPR International Covenant on Civil and Political Rights

ICESCR International Covenant on Economic, Social, and Cultural Rights

NIEO New International Economic Order

NPRPPM Non-Product Related Production Process and Methodology

SCM Agreement on Subsidies and Countervailing Measures

SDT Special and Differential Treatment

SPS Agreement on the Application of Sanitary and Phytosanitary Measures TBT Agreement on Technical Barriers to Trade

TRIPS Agreement on Trade Related Aspects of Intellectual Property Rights

xxxi

Foundations

1.1 Distributive Justice in International Trade

We live in an unequal world This much is beyond dispute

We can describe that inequality in many ways In terms of nationalincome: in 2015, per capita GDP in the United States, adjusted for pur-chasing power, was $55,836; in China, $14,238; in the Democratic Republic

of Congo, $728.1In terms of life expectancy: in the United States today,81.2 years; in China, 76; in the Democratic Republic of Congo, 59 Similarinequalities appear in access to key services like clean water, electricity, andhealthcare, and in access to education, with the manifold economic andpersonal opportunities it brings Regardless of the metric, wefind radicalinequalities across countries that directly impact on individuals’ chances ofliving long, healthy, andflourishing lives

We also live in a world that is economically connected Throughinternational commerce, goods, services, capital, and (less often) labormove across borders Clothes made in Dhaka are worn in Dublin, whilelawyers in New York advise clients in New Delhi And global value chainsmean production is rarely limited to individual countries Despite theirdifferences, the countries mentioned above have at least one thing incommon: they directly contributed to producing the computer on whichthis book was written It was designed in the United States, assembled inChina, and used raw materials from – among many others – theDemocratic Republic of Congo We are citizens of states, but we arealso– in varying ways and to varying extents – participants in a globaleconomy that transcends those states

1

(World Bank, 2016 ).

Often, when we talk about justice in the global economy, it is these twofacts, of inequality and interconnectedness, that we emphasize For some,

as scholars and citizens, the fact of inequality alone is determinative of thejustice or injustice of the global economy: no world in which suchinequalities exist could possibly be just For others, it is the fact that weenjoy such radically different benefits from an economy in which we allparticipate: it is not just that there are inequalities, but that we benefitunequally from something in which we are all involved This sense ofjustice finds various expressions in the trade context: in the Fair TradeMovement; in World Trade Organization rules on Special and

Differential Treatment for Developing Countries; and in the remnants

of the post-colonial New International Economic Order

But in practice, these inequalities are rarely the most prominentissues in debates about justice and fairness in international traderegulation Here, we are more often concerned with trade barriers,where one country reduces tariffs or other obstacles, but others donot reciprocate; or discrimination, where goods from one country aretreated differently from those of another; or competition between astruggling domestic industry and cheap foreign imports; or nationalregulations that impact on, and indeed target, exporters in otherjurisdictions, including through their environmental, labor, andhuman rights practices It is these issues that are the bread and butter

of the trade regime; and while not unrelated to questions of economicinequality, they do not reduce to them

What all these issues have in common is that they express competingclaims that cannot all be satisfied The claim that coffee growers in thedeveloping world should enjoy a greater share of benefits from produc-tion is necessarily a claim that others, whether farm owners, processors,distributors, retailers, or consumers, should relinquish some of theirgains But the trade unionist’s claim to protection from low-pricedforeign imports is similarly a claim to deprive foreign workers of employ-ment, to deprive foreign producers of some of the gains they hoped tomake, and to deprive consumers at home of the opportunity to consumethose cheaper imports And the environmentalist’s claim to dictate theconditions under which imported tuna are caught requires that foreignfishermen give up some of their opportunities for catching fish, and limitsexporting countries’ freedom to decide for themselves the balancebetween economic development and environmental protection

It is the fact that claims conflict that makes these issues difficult Fewdeny it would be better if the world’s poorest enjoyed greater opportunities

and higher standards of living, closer to those enjoyed in high-incomecountries Where we disagree is about whether and to what extent othershave duties to act, and to sacrifice, to bring that about Similarly, most canrecognize the suffering of workers in declining industries, and the value ofprotecting endangered species But we disagree about how much weshould be doing to address either, about who should make the decisions,and about who should bear the costs.

The fact of conflict is similarly what makes these issues of distributivejustice David Hume identified two features of the world as constitutingthe“circumstances of justice”: first, moderate scarcity – there is enough

so that all can have enough, but not so much that all can have everythingthey desire; and second, limited altruism – we can acknowledge theclaims of others, but our primary focus remains on our own goals andprojects.2These facts together constitute a moral landscape in which wemust choose between the competing claims of different individuals andgroups

As sketched so far, these issues pose a question of political morality:how should the competing demands of different constituencies be recon-ciled, given that not all can be fully satisfied? However, in the world inwhich we live, they also raise questions of international economic law,which may fall to be debated and resolved under the rules of the WorldTrade Organization (WTO) Faced with import duties to protect infantindustries, or subsidies to promote clean energy, or regulations to protectseal welfare, we can ask whether these are prudent, fair, or just: but themore practically relevant question will often be whether they are lawful

by the standards of the WTO By prohibiting and permitting particularmeasures, WTO rules endorse the claims of some groups over those ofothers, making judgments about how far the demands of each should besatisfied And in each case, different rules would lead to different results,improving the lot of some while disappointing others WTO law cannotavoid taking some position on these questions of distributive justice.Distributive conflict and distributive justice are thus unavoidableconcerns for international trade regulation That inevitability is oftenobscured by economists’ emphasis on the mutual gains that derive frominternational cooperation Certainly, few would deny that great gains arepossible through international trade But after we have done all we canthrough cooperation to enlarge the collective economic pie, we willalways and necessarily face questions of how that pie is to be divided,

2

(Hume, 2000 : §3.2.2) Cf (Rawls, 1971 : 126 –127).

given the many competing claims thereon Once this fact is edged, we need some way to answer the questions of distributive justicethat the international trading system poses Yet we lack any adequatetheory of what distributive justice means or demands in the context ofinternational trade regulation, or of the implications this has for inter-national trade law We need a theory of justice for international trade law.That is the task of this book.

acknowl-1.2 Why Trade Law Needs a Theory of Justice

International trade law is not a new pursuit The trade regime has existed

in its present form since 1994, while central elements of the goods regimedate from the General Agreement on Tariffs and Trade 1947 At leastfrom the late 1970s, that regime has been substantially legal in character,including quasi-judicial organs applying legal methods to interpretagreements and adjudicate members’ compliance therewith It is fre-quently cited as the most successful system of legalized internationalgovernance that we have Having got by so well for so long, we mightwonder whether the trade regime really needs a theory of justice

A theory of justice can play at least three important roles for the traderegime Thefirst is explanatory and justificatory The second is critical.And the third is interpretive Notwithstanding the apparent successes ofthe trade regime, the under-fulfillment of these functions weakens thelegitimacy of both its rules and its decisions, and particularly of its quasi-judicial organs

First, a theory of justice might tell us what the rules of the traderegime are for, and why we have reason to endorse them There are,

of course, various existing theories of the function of the traderegime The most prominent explain the trade rules as realizingeconomic efficiency Those explanations have serious defects inaccounting for the specifics of the trade rules They also struggle tojustify those rules to critics who doubt that economic efficiency is anoverriding value, and worry that trade law gives insufficient weight,

on the one hand, to environmental, human rights, and developmentconcerns, and on the other hand, to the ways the costs and benefits ofinternational trade are distributed, both within and between coun-tries A theory of justice might hope both to better account for therules, and to offer a more compelling justification

Second, a theory of justice plays an important critical role Justice, Rawlsreminds us, is“the first virtue of social institutions, as truth is of systems