The Kyoto Protocol & the WTO : Reconciling Tensions between Free Trade & Environmental Objectives

This article analyzes the intersection between international trade and environmental regimes. Increasingly, multilateral environmental agreements (MEAs) rely on trade measures to implement and enforce environmental obligations. Trade-related environmental measures accentuate the existence of tensions and the necessity of clarifying the relationship between free trade and environmental objectives, as embodied by the World Trade Organization (WTO) and MEAs, such as the Kyoto Protocol. The Kyoto Protocol to the United Nations Framework Convention on Climate Change (UNFCCC) exemplifies the inevitable intersection of environmental and trade objectives. Both the UNFCCC and the Kyoto Protocol address the causes and consequences of global climate change. The Kyoto Protocol, more than any existing MEA, is likely to impact state economies and international trade relations. The Kyoto Protocol promotes the UNFCCC goal of “stabilizing atmospheric concentrations of greenhouse gases at a level that would prevent dangerous anthropogenic interference in the climate system.” United Nations Framework Convention on Climate Change, art. 2, May 9, 1992, 31 I.L.M. 849. Limiting greenhouse gas emissions under Kyoto requires developed countries to modify primary economic structures, including transformations within energy, transportation, manufacturing, agriculture, and investment sectors. Therefore, although Kyoto does not directly implicate trade provisions or contravene WTO rules, it has the potential to impact key sectors of the economy and international trade. Accordingly, the Kyoto Protocol provides an appropriate context for analyzing fundamental tensions between international trade and environmental regimes. This article suggests that it is essential that the WTO develop a conceptually sound framework for managing such issues. To this end, the WTO should modify its “constitution” through the adoption of an interpretative clause that provides clear principles for defining the relationship between the WTO and MEAs