Tuna-Dolphin GATT Case (I and II)

The controversy and initial ban by United States on tuna imports from Mexico was based on the "taking" prohibition in the MMPA (Marine Mammal Protection Act of 1972). The MMPA requires a general prohibition on "taking" and importation into the United States of marine mammals including (harassment, hunting, killing, capture, or any attempts thereof) unless explicitly authorized. The goal of this Act being that reducing incidental kill and injury rates of marine mammals by commercial fishermen. The provisions in the MMPA are applicable to tuna caught in the ETP off the coast of North, Central and South America. Specifically these rules apply to the taking of marine mammals incidental to the harvest of yellowfin tuna as well as the importation of said yellowfin tuna harvested in the ETP. This rule is enforced by the NMFS National Marine Fisheries Service, while the importation is enforced by the United States Custom Service.[2]

As clearly stated in Section 101(a)(2) of the MMPA "The Secretary of Treasury shall ban the importation of commercial fish or fish products which have been caught with commercial fishing technology which results in the incidental kill or serious injury of ocean mammals in excess of United States standards". According to Section 101(a)(2)(B), the importation of yellowtail tuna harvested using purse-seine nets in the ETP is prohibited unless the government of the importing country can show that it has a program comparable to the average rate of taking in United States for reducing marine mammal bycatch. It is on the burden of the country requesting a finding and they must show through documentary evidence that taking rates are comparable. Under Section 101(a)(2)(B) of MMPA there are special prerequisites for determining average incidental taking rates as comparable to those subjected of the United States commercial fleets. The average incidental taking rate (meaning dolphins killed as purse-seine nets are deployed) for any country's tuna fleet may not exceed 1.25 the average taking rate of US vessels in the same period. Furthermore, species of Eastern Spinner Dolphins and coastal spotted dolphins for one year may not exceed 15% and 2% for these species comparable to US fleets.[2]

On August 28, 1990, pursuant to court orders, the US government imposes embargo on yellowfin tuna imports harvested with purse-sein netting in the Eastern Tropical Pacific Ocean. This remains in place until the Secretary of commerce can show compliance with MMPA standards. This embargo initially affected Mexico, Venezuela, Vanuatu, Panama and Ecuador. On a revised embargo effective March 26, 1991 yellowfin tuna and other "light meat" tuna that could potentially contain yellowfin, according to harmonized system tariff headings are prohibited for import unless the importer can provide written evidence that no yellowfin tuna were harvested using purse-seine fishing techniques. This can be tracked by the NOAA Form 370-1 which is required "Yellowfin Tuna certificate of origin" and it is required to submit by the country of origin. Since Mexico did not want to comply with the new standards of modifying their fishing techniques, no products were accepted from origin of Mexico into the United States.[2]

A pantropical spotted dolphin (Stenella attenuata). Photo courtesy of the National Oceanic and Atmospheric Administration (NOAA)

Beginning November 1990, Mexico started to bring the complaint to the US. The complaint then went through GATT (General Agreement on Tariffs and Trade) dispute resolution system.[2] This became known as the Tuna-Dolphin (I) case.[3] Mexico argued that the US MMPA product ban on tuna imports was inconsistent with the provisions of GATT. Arguing that the ban was inconsistent with Article XI, Article XIII, Article III of GATT. Mexico also claimed that the embargo did not meet the exceptions of Article XX. Article III refers to the National treatment provision and the fact that countries must apply tariffs equally to similar products of all other contracting parties. This also brings to debate the Product vs. process debate. Also known as PPM's (Process and Production Methods), referring to desire of some countries to regulate international trade on like for like goods on the basis of their process technologies or harvesting techniques in this case. Although the intention of the embargo is to bring to light the externalities of dolphin casualties due to the purse-seine harvesting techniques, the issue of PPMs is that the process is irrelevant if the product is the same. Developing countries have historically been wary of including PPM's in the WTO. The fear being that this will create an imposition of environmental, technological and other qualitative standards with high thresholds set by industrialized countries thus creating a technical disadvantage for developing countries. Essentially what Mexico argues is that MMPA is discriminating against like products based on their production methods. Article XI addresses the quantitative restriction provision which involves the dispute over embargoes vs. tariffs. Article XI says that a country is permitted to impose tariffs as a trade restriction but prohibits any type of non-tariff restriction such as quotas or limiting importing/ exporting licenses. Further, Mexico argues the Article XX provision of GATT is inconsistent with that of the MMPA. Specifically Article XX(b) and XX(g) which refer to the allowance of trade restrictions when it is deemed "necessary to protect human, animal or plant life or health" or "relating to the conservation of exhaustible natural resources". The issue with Article XX is that even while it may be valid, it cannot be applied outside the jurisdiction of the United States, hence making the argument in the favor of Mexico.[2]

The outcome of this challenge fell in the favor of Mexico however these findings were not adopted formally due to the upcoming NAFTA negotiations, however the argument was revisited in the Dolphin Tuna II case in 1992.[2]

The EEC and the Netherlands argued that the intermediary nation embargo constituted as a "quantitative" restriction, and as such, it was in violation of Article XI of the GATT, which clearly forbids the enforcement of any prohibitions or restrictions other than "duties, taxes, or charges." With respect to Article III, they claimed that the measures of the intermediary nation embargo could not be considered as "the enforcement at the time or point of importation of an internal law, regulation, or requirement which applied equally to the imported product and the like domestic product." The EEC and the Netherlands argued that domestic measure only applied to limiting incidental dolphin mortality, but did not regulate the sale of tuna; whereas, in the case of intermediary nations, the border measure outright banned the importation of tuna if they could not certify that they had not, during the previous six months, imported yellowfin tuna or yellowfin tuna products subject to the primary nation embargo. They based their argument on a note in the GATT report that brought further clarification to the meaning of Article III. It states that, "any law, regulation, or requirement…which applies to an imported product and to the like domestic product and is…enforced in the case of the imported product at the time or point of importation, is nevertheless to be regarded as…a law, regulation, or requirement subject to the provisions of Article III.[4]

Lastly, the EEC and the Netherlands contended that the note to Article III only pertained to products "as such." The ban on tuna being exported from intermediary nations was entirely policy-based, versus product-based.[4]

The United States argued that regardless of whether its embargo measures violated Articles XI and III, they were covered under Article XX (g) and (b) as measures (1) "relating to the conservation of an exhaustible resource," and (2) "necessary to protect the life and health of dolphins," respectively.[4]

The EEC and the Netherlands argued that the species needing conservation had to be within the jurisdictional territory of the nation enforcing the measure. In addition, they stated that United States measures were not related to the conservation of an exhaustible natural resource, as they did not consider dolphins as such. Moreover, the EEC and the Netherlands argued that United States measures were not taken in conjunction with "domestic restrictions on production or consumption."[4]

The United States rebutted by claiming that nowhere in Article XX (g), was there any mention of the resource needing conservation having to be within the jurisdictional territory of the country enforcing the measure. To support its argument, the U.S. cited a previous GATT case "U.S.-prohibition of imports of tuna and tuna products from Canada," noting that no such jurisdictional limitation was found, and that the resource being conserved was in fact, outside the jurisdiction of any country. The United States also claimed that its embargo measures were in fact taken in conjunction with restrictions on domestic production and consumption, and that they met the requirement of the preamble to Article XX.[4]

Arguments regarding jurisdictional territory were the same as for Article XX (g). While the EEC and the Netherlands argued that United States measures "were not necessary within the meaning of Article XX (b)," the United States rebutted, claiming that (1) the measures were necessary to achieve the policy goal of protecting the life and health of dolphins, and (2) they met the requirements of the preamble to Article XX.[4]

For Articles XI and III, the GATT panel ruled in favor of the EEC and the Netherlands. For Article XI, the panel agreed that the United States embargoes on yellowfin tuna and yellowfin tuna products were in fact "prohibitions or restrictions," not "duties, taxes, or other charges." For Article III, after reviewing the note to it mentioned above, the panel concluded that this provision could only be applied with respect to a measure which "applies to an imported product and to the like domestic product." They also agreed with the EEC and the Netherlands on the fact that Article III's purpose only pertains to the conditions for treatment comparisons between domestic and importing countries' like products, not their policies and practices.[4]

For both Articles XX (g) and (b), the panel ruled in favor of the United States with regard to the dispute over jurisdiction. Like the United States, they too, could not find any content with the GATT that alluded to the exhaustible resource needing conservation or protection, having to be within the jurisdictional territory of the country enforcing the measure.[4]

After carefully examining the relationship between United States measures and its goal of dolphin conservation, the panel came to the conclusion that banning the tuna would not in itself conserve the dolphins; only policy changes would, which they felt was not within the original purpose of the GATT. The GATT was only supposed to deal with member states' products, not their processes or policies.[4]

To determine whether United States measures for dolphin protection were "necessary," the panel first examined what the meaning of this word meant. The United States argued that necessary meant "needed," whereas, the EEC and the Netherland felt it meant "indispensable" or "unavoidable." To support their argument, they referred to a previously adopted panel report which interpreted "necessary" as meaning "no alternative measures" exist. The panel also agreed with this interpretation, and felt, once again, that banning yellowfin tuna and tuna products was not a measure that was necessary to protect dolphins; the only way to protect dolphins would be for intermediary nations to change their policies and practices, which was not within the original purpose of the GATT to regulate. Furthermore, the panel felt that banning tuna from primary and intermediary nations, regardless of whether their practices harmed or killed dolphins, but rather based on the fact of whether their practices were comparable to that of the United States, made it seem as if the United States was forcing primary and intermediary nations to adopt its fishing policies; this clearly was never the purpose of the GATT. For these reasons, the panel did not rule in favor of the United States.[4]