The Extrajurisdictional Effects of Environmental Measures in the WTO Law Balancing Process

Environmental protection policies become relevant in WTO law if they lead to extrajurisdictional effects. These effects might have different benchmarks, and may restrict free trade rules or competing policy goals. Although both forms of extrajurisdictional effects occur in WTO case law, this differentiation extends further than has been previously discussed. This paper refers to Article XX GATT and the Articles 2.1 and 2.2 TBT. Despite some vague legal terms leading to large discretions, the necessity test respectively the ‘relating to’ requirements and the exclusion of disguised discrimination are capable of resolving conflicts between environmental measures and free trade rules conclusively. However, if the benchmark is a competing environmental policy measure, both measures can refer to the same rule. If both environmental measures then fulfil the balancing requirements, but the realization of both regulatory goals is not possible, the balancing process results in stalemate. This paper considers two approaches to resolving such a collision: the comparison of the intensity of extrajurisdictional effects, and the re-evaluation of the regulatory goal. It is asserted that both approaches contain shortcomings.