Does Free Trade Undermine International Rules Protecting the Environment?


The WTO was created to promote free trade: to remove barriers between countries, to allow them to concentrate on products with a comparative advantage, leading to maximum international productivity. This, however, often challenges rules protecting the environment. Although the WTO has shown an increasingly open approach towards environmental issues, free trade is still the Organisation’s backbone and trade liberalisation its main goal.

One might argue that the WTO was conceived as a trade organisation, and its Members agreed to that mandate. Indeed, many of its Members are developing countries that have resisted including environmental protection concepts – such as sustainable development – in the WTO.

The WTO’s dispute settlement system was not designed to resolve challenges regarding trade and environment, legitimacy, globalisation and international law’s fragmentation. Although it does adjudicate trade-environment disputes, their resolution involves scrutinising the trade-friendliness of environmental laws – not whether the WTO Member’s actions/laws are appropriately green.

International environmental law, on the other hand, ‘provides the global institutional means for engaging the global ecological challenges’. Consisting of a loose affiliation of treaties, principles and customs, it is a complex evolutionary system of law, further complicated by a dizzying array of stakeholders. There is considerable tension between the environmental goals and the rapid growth in international trade that places pressure on the earth’s ecosystems.

Fragmentation has been named one of the past decade’s most provocative international legal issues. As illustrated, WTO free trade rules have repeatedly undermined international rules of the environment. Even if coincidentally benefiting both free trade and environmental protection, it is within WTO constraints. However, one can refrain from criticising the WTO dispute settlement mechanism as its decisions comply with the mandate under which it operates, which, due to the current fragmentation of international law, does not cover environmental protection. Nonetheless, this should not eclipse the need for change, especially since environmental problems that threaten humanity – such as climate change – demand international cooperation. Schoenbaum calls the WTO to give specific recognition to environmental values, as necessary. Perhaps international environmental law must also be strengthened, through the establishment of sufficiently powerful institutions to represent non-economic concerns and penetrate specialist systems.