The barb in trade agreements' tail is the Investor State Dispute Settlement (ISDS) system, which lets companies sue governments to repeal rules that interfere with their profitability. It's let tobacco giants fight anti-smoking campaigns, and now it's letting fisheries attack rules aimed at preventing the wholesale slaughter of dolphins.
Since the 1990s, non-US fisheries have attacked America's Marine Mammal Protection Act, which bans the importation of tuna that is caught with dolphin-killing dragnets. Today, thanks to trade court actions under the WTO, the MMPA has been watered down to little more than a requirement to mark tuna with labels indicating how it was caught. Mexico has fought even this minimal requirement since 2008, and now the WTO has handed down a final ruling in Mexico's favor that cannot be appealed, ruling that America's labelling rules are a barrier to trade, meaning that the US has to repeal the rules or face billions in sanctions.
This is the second labelling law that's been struck down by a WTO trade tribunal this year: both the US and Canada are set to end their requirement for country-of-origin labelling on meat, after the WTO threatened both countries with billions in sanctions if they continued the practice.
These provisions are just a preview of the expanded powers that corporations will be able to exert over national governments if the Trans Pacific Partnership is ratified. The agreement was negotiated without any democratic scrutiny — elected lawmakers from the 12 countries were not allowed to see the drafts or attend the negotiations — but with full participation from corporate lobbyists, who were the principal authors of many of the provisions and who were included in the negotiating delegations.
The WTO has ruled in Mexico's favor on four separate occasions since 2011, most recently last Friday, in a final ruling that cannot be appealed. Though the U.S. changed its label standards several times, most recently in 2013, the WTO said that the law discriminates against tuna caught in Mexico, relative to other countries. Informing consumers of the fishing practices used to catch their tuna, the WTO concluded, represented a "technical barrier to trade."
Tim Reif, general counsel at the U.S. Trade Representative's Office, told Reuters that the U.S. won't have to reduce protection for dolphins or change its labeling requirements. But the U.S. must either conform its law to the WTO ruling or face Mexican retaliation against U.S. imports unless officials negotiate with Mexico to find some resolution.
WTO Ruling on Dolphin-Safe Tuna Labeling Illustrates Supremacy of Trade Agreements [David Dayen/The Intercept]