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WTO Regulations and Bioenergy Sustainability Certification – Synergies and Possible Conflicts

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  • Robert Ackrill
  • Adrian Kay

Abstract

Biofuels are increasingly being produced and consumed as a partial substitute to fossil-fuel based transport fuels in the fight against climate change. One policy introduced recently by some countries to help ensure biofuels perform better than fossil fuels environmentally is sustainability criteria. These, typically, require lower greenhouse gas emissions than fossil fuels, considering not only their use but also production. Concerns have been expressed from various quarters that such criteria could represent WTO-incompatible barriers to trade. The present paper addresses two specific issues. First, it argues that biofuels should be treated like any other traded product under WTO law, in particular the GATT agreement. Thus an importing country could not impose different trade measures dependent on whether the biofuel was produced according to its sustainability criteria. Second, the TBT Agreement provides guidance on how to draw up international standards that can help ensure WTO compatibility. This cannot guarantee such compatibility, but it can help reduce significantly the chances of WTO Members bringing actions against a fellow Member’s biofuels sustainability criteria. There is little direct case law to draw upon, but it is argued that, if the TBT guidance is followed, in the long term the absence of case law can be taken as an indication that sustainability criteria are WTO-compatible.

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File URL: http://www.ntu.ac.uk/research/document_uploads/102325.pdf
File Function: First version, 2010
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Bibliographic Info

Paper provided by Nottingham Trent University, Nottingham Business School, Economics Division in its series Working Papers with number 2010/9.

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Date of creation: Dec 2010
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Handle: RePEc:nbs:wpaper:2010/9

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Web page: http://www.ntu.ac.uk/nbs

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Keywords: biofuels; sustainability; WTO;

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References

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  1. Bradly J. Condon, 2009. "Climate Change and Unresolved Issues in WTO Law," Journal of International Economic Law, Oxford University Press, vol. 12(4), pages 895-926, December.
  2. Le Roy, Danny G. & Elobeid, Amani E. & Klein, Kurt K., 2009. "The Impact of Trade Barriers on Mandated Biofuel Consumption in Canada," Commissioned Papers 54972, Canadian Agricultural Trade Policy Research Network.
  3. Alan Swinbank, 2009. "EU Policies on Bioenergy and their Potential Clash with the WTO," Journal of Agricultural Economics, Wiley Blackwell, vol. 60(3), pages 485-503.
  4. Ilona Cheyne, 2009. "Proportionality, Proximity and Environmental Labelling in WTO Law," Journal of International Economic Law, Oxford University Press, vol. 12(4), pages 927-952, December.
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Cited by:
  1. Rob Ackrill and Simeon Coleman, 2012. "Inflation dynamics in central and eastern European countries," Working Papers 2012/01, Nottingham Trent University, Nottingham Business School, Economics Division.
  2. Simeon Coleman Author name: Vitor Leone, 2012. "Time-series characteristics of UK commercial property returns: Testing for multiple changes in persistence," Working Papers 2012/03, Nottingham Trent University, Nottingham Business School, Economics Division.
  3. Simeon Coleman, 2011. "Investigating Business Cycle Synchronization in West Africa," Working Papers 2011/01, Nottingham Trent University, Nottingham Business School, Economics Division.
  4. Coleman, Simeon & Sirichand, Kavita, 2012. "Fractional integration and the volatility of UK interest rates," Economics Letters, Elsevier, vol. 116(3), pages 381-384.
  5. Otavio Ribeiro de Medeiros and Vitor Leone, 2012. "Multiple Changes in Persistence vs. Explosive Behaviour: The Dotcom Bubble," Working Papers 2012/02, Nottingham Trent University, Nottingham Business School, Economics Division.

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