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Forgotten promises: Neglected environmental provisions of the NAFTA and the NAAEC

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INTRODUCTION One of the political hot potatoes that President George H. W. Bush passed off to President Bill Clinton in 1993 was getting the United States Congress to adopt legislation implementing the North American Free Trade Agreement (NAFTA), which was signed late in President Bush’s term. To help get the NAFTA through Congress, and to meet his campaign promises to bolster the quite modest environmental and labor provisions in the text of the NAFTA, President Clinton hastily negotiated side agreements with Canada and Mexico on labor and on the environment in the first year of his presidency. The environmental side agreement, the North American Agreement on Environmental Cooperation (NAAEC), was intended to address concerns that liberalized trade among Canada, Mexico, and the United States would increase environmental harms due to the increased scale of economic activity; create havens for polluting industries, for example, along the United States–Mexico border; and trigger a “race to the bottom” in which the governments would weaken environmental regulations or enforcement in order to attract economic benefits of trade. The NAAEC came into effect on January 1, 1994. It created the trinational Commission for Environmental Cooperation (CEC), headed by a council made up of the top environmental official of each country, and imposed on the government Parties various obligations designed to minimize environmental concerns related to the NAFTA. Together the NAFTA and the NAAEC contain various provisions to address these concerns. The NAFTA, described further in Section 2, discourages weakening of environmental measures, encourages the upward harmonization of environmental laws and regulations, gives certain multilateral environmental agreements qualified precedence over the NAFTA, and constrains assertions that a country’s environmental protection measures constitute a nontariff trade barrier. The NAAEC, also described further in Section 2, imposes soft obligations on Canada, Mexico, and the United States to maintain high levels of environmental protection, to effectively enforce their environmental laws, and to ensure due process in the treatment of environmental claims in domestic proceedings. It also gives the CEC Council the authority to engage the governments in a broad program of environmental cooperation and requires the council to consider the environmental impacts of the NAFTA on an ongoing basis and to work toward an agreement on transboundary environmental impact assessment.
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1
Forgotten Promises
Neglected Environmental Provisions of the NAFTA
and the NAAEC
Geoffrey Garver
1.introduction
One of the political hot potatoes that President George H. W. Bush passed off to
President Bill Clinton in 1993 was getting the United States Congress to adopt legis-
lation implementing the North American Free Trade Agreement (NAFTA),1which
was signed late in President Bush’s term. To help get the NAFTA through Congress,
and to meet his campaign promises to bolster the quite modest environmental and
labor provisions in the text of the NAFTA, President Clinton hastily negotiated
side agreements with Canada and Mexico on labor and on the environment in the
first year of his presidency. The environmental side agreement, the North Ameri-
can Agreement on Environmental Cooperation (NAAEC),2was intended to address
concerns that liberalized trade among Canada, Mexico, and the United States would
increase environmental harms due to the increased scale of economic activity; cre-
ate havens for polluting industries, for example, along the United States–Mexico
border; and trigger a “race to the bottom” in which the governments would weaken
environmental regulations or enforcement in order to attract economic benefits of
trade.3The NAAEC came into effect on 1January 1994. It created the trinational
Commission for Environmental Cooperation (CEC), headed by a council made up
of the top environmental official of each country, and imposed on the government
Parties various obligations designed to minimize environmental concerns related to
the NAFTA.
1North American Free Trade Agreement between the Government the United States of America,
the Government of Canada and the Government of the United Mexican States, San Antonio,
17 December 1992,inforce1January 1994,(1993)32 ILM 296; Can. TS 1994 No. 2,32.
214 September 1993,inforce1January 1994,(1993)32 ILM 1480; Can. TS 1994 No. 3.
3See Pierre Marc Johnson and Andr´
e Beaulieu, The Environment and NAFTA: Understanding and
Implementing the New Continental Law (Washington, DC: Island Press, 1996), pp. 234,367,407,
2456; Joseph A. McKinney, Created from NAFTA: The Structure, Function, and Significance of the
Treaty’s Related Institutions (Armonk, NY: M. E. Sharpe, 2000), pp. 901.
15
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16 Geoffrey Garver
Together the NAFTA and the NAAEC contain various provisions to address these
concerns. The NAFTA, described further in Section 2, discourages weakening of
environmental measures, encourages the upward harmonization of environmental
laws and regulations, gives certain multilateral environmental agreements qualified
precedence over the NAFTA, and constrains assertions that a country’s environ-
mental protection measures constitute a nontariff trade barrier. The NAAEC, also
described further in Section 2, imposes soft obligations on Canada, Mexico, and
the United States to maintain high levels of environmental protection, to effec-
tively enforce their environmental laws, and to ensure due process in the treatment
of environmental claims in domestic proceedings. It also gives the CEC Coun-
cil the authority to engage the governments in a broad program of environmental
cooperation and requires the council to consider the environmental impacts of the
NAFTA on an ongoing basis and to work toward an agreement on transboundary
environmental impact assessment. To ensure the governments fulfil their obligation
to effectively enforce their environmental laws, the NAAEC establishes two mea-
sures: a citizen-driven accountability mechanism able to yield detailed investigative
reports, called factual records, on allegations that a Party has failed to effectively
enforce its environmental law and a Party-to-Party dispute resolution process that
can lead to monetary sanctions or to the loss of NAFTA benefits.
In its first twenty years, the CEC has produced a sustained cooperative program
that has yielded some important results,4especially in early years when, for example,
the CEC assisted Mexico in phasing out DDT5and began issuing its annual Taking
Stock report, which combines pollutant, release, and transfer information from the
three countries.6As of May 2013, the citizen-driven submissions on enforcement mat-
ters (SEM) mechanism had received eighty-one submissions and generated seven-
teen factual records – although the impact of factual records generally has been quite
limited.7Overall, measured against its potential to foster aggressive policies on press-
ing regional and global environmental challenges, particularly related to energy and
climate change, the CEC has fallen short.8Further, several important environmen-
tal provisions of the NAFTA and the NAAEC have been either neglected or aban-
doned, casting doubt on the environmental promise and legacy of the agreements.
4See Scott Vaughan, “Thinking North American Environmental Management,” in Thomas J. Courch-
ene, Donald J. Savoie, and Daniel Schwanen (eds.), The Art of the State II: Thinking North America
(Montreal: Institute for Research on Public Policy, 2004), folio 5, pp. 201.
5See Commission for Environmental Cooperation, “DDT no longer used in North America” (2003),
http://cec.org/Storage/50/4285 DDT en.pdf .
6See Commission for Environmental Cooperation, “Taking stock,” http://cec.org/Page.asp?
PageID=924&SiteNodeID=483.
7See Pierre Marc Johnson et al., “Ten Years of North American Environmental Cooperation: Report of
the Ten-year Review and Assessment Committee to the Council of the Commission for Environmental
Cooperation,” 15 June 2004,p.46, http://cec.org/Storage/79/7287 TRAC- Report2004 en.pdf.
8See Vaughan, “Thinking North American Environmental Management,” pp. 235.
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Forgotten Promises 17
Yet some of these neglected provisions have become boilerplate elements in the
environmental frameworks negotiated in post-NAFTA trade deals to which Canada,
Mexico, or the United States have signed on, raising the concern that they provide
“green” cover for trade deals that do little in practice to confront the global ecological
challenges that have been increasing – while also becoming ever more apparent –
as regional and global trade has expanded.9
This chapter focuses on three of the most prominent neglected environmental
instruments of the NAFTA and the NAAEC: one that aimed to address fears of a
potential “race to the bottom” in levels of environmental protection, another that
responded to concerns about weak environmental enforcement, and a third that
created an expanded opportunity to examine the environmental effects of North
American economic activity.
The results, in short, have been disappointing. As for the first instrument, the
three governments have evidently completely ignored the mild mandate to prevent
weakening of environmental protections in the NAFTA countries that the states were
given most explicitly in the NAFTA’s Article 1114(2). The second, the Party-to-Party
dispute resolution process set out in Part V of the NAAEC, which aims to provide a
remedy for persistent patterns of weak enforcement of environmental laws, has never
come to life. Finally, Canada, Mexico, and the United States have failed to conclude
the agreement on transboundary environmental impact assessment (TEIA) that is
called for in the NAAEC’s Article 10(7).
Section 2places these provisions in the context of the entire framework for trade
and the environment that the NAFTA and the NAAEC establish. Section 3describes
the provisions that relate to nonregression of environmental protections and discusses
the Parties’ failure to implement them despite the weakening of several environmen-
tal laws in Canada, Mexico, and the United States since the NAFTA and the NAAEC
came into effect. Section 4presents an analysis of the failure to implement the Party-
to-Party dispute resolution in Part V of the NAAEC. Section 5presents and analyzes
the governments’ unsuccessful attempts to reach an agreement on TEIA. The con-
clusion summarizes the implications of the failure to make use of these neglected
provisions, especially in light of the adoption of the first two by numerous subse-
quent agreements,10 and suggests that the NAFTA and the NAAEC have established
“tragic institutions”11 because they resist change and occupy policy space that better
alternatives should fill.
9On increasing ecological concerns associated with trade, see, e.g., Duncan Pollard et al. (eds.),
Living Planet Report 2010: Biodiversity, Biocapacity and Development (Gland, Switzerland: WWF
International, 2010), pp. 789; Chris Hails et al. (eds.), The Living Planet Report (Gland, Switzerland:
WWF International, 2008), pp. 289.
10 See infra notes 107 and 108 and accompanying text.
11 Brigham Daniels, “Emerging commons and tragic institutions” (2007)37:3Envtl. L.515 at 5201,
53941.
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18 Geoffrey Garver
2.summary of the nafta and the naaec environmental
provisions
At the time of its adoption, promoters of the NAFTA called it the most environmental
trade agreement to date.12 Yet its environmental provisions were insufficient to allay
environmental concerns regarding expanded trade in North America. The NAAEC
addressed at least some of those concerns, and together the NAFTA and the NAAEC
established the basic approach to trade and environment that the North American
countries have followed, with various permutations, in their subsequent trade deals.
This section presents an overview of the key environmental provisions of the NAFTA
and the NAAEC and places the neglected provisions noted in Section 1in the context
of this framework.
2.1.Environmental Provisions of the NAFTA
The preamble to the NAFTA states the resolve of the NAFTA governments to
“UNDERTAKE [their NAFTA obligations] in a manner consistent with environ-
mental protection and conservation; . . . [to] STRENGTHEN the development and
enforcement of environmental laws and regulations; and [to] PROMOTE sustain-
able development.”13 The text then expands on these objectives. It provides at least
some protection to the Parties’ existing environmental commitments against poten-
tial accusations that they amount to trade barriers and to the Parties’ ability to
adopt and maintain environmental standards, and it promotes harmonization of the
Parties’ standards while encouraging higher levels of environmental protection and
discouraging backsliding.
In the event of an inconsistency with the NAFTA, Article 104 of the NAFTA
gives qualified precedence to several international environmental agreements: the
Convention on International Trade in Endangered Species of Wild Flora and Fauna
(CITES), the Montreal Protocol on Substances that Deplete the Ozone Layer,
the Basel Convention on the Control of Transboundary Movements of Hazardous
Wastes and their Disposal, and bilateral agreements between the United States and
Canada on the movement of hazardous wastes and between the United States and
Mexico on environmental protection in the United States–Mexico border area. The
NAFTA also affirms the Parties’ right to adopt environmental standards according
to their desired levels of environmental protection, and to impose those standards
on other Parties’ goods and services, so long as doing so advances a “legitimate
objective” and is nondiscriminatory.14 Further, the NAFTA requires the Parties to
12 See Johnson and Beaulieu, The Environment and NAFTA,p.66; Greg Block, “Trade and environ-
ment in the western hemisphere: Expanding the North American Agreement on Environmental
Cooperation into the Americas” (2003)33:3Envtl. L.501 at 503.
13 NAFTA, Preamble.
14 Ibid., Article 904.
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Forgotten Promises 19
“work jointly to enhance the level of safety and of protection of human, animal
and plant life and health, the environment and consumers”15 and to work toward
making their environmental standards compatible without weakening them.16 The
dispute resolution process in Article 20 of the NAFTA applies to Party-to-Party
disputes regarding the standard-setting provisions and consistency with multilateral
environmental agreements, but to date no such disputes have been initiated.17
The most explicit provision in either the NAFTA or the NAAEC that prohibits
backsliding, or regression, in levels of environmental protection – albeit softly – is
the NAFTA’s Article 1114(2). It states:
The Parties recognize that it is inappropriate to encourage investment by relaxing
domestic health, safety or environmental measures. Accordingly, a Party should
not waive or otherwise derogate from, or offer to waive or otherwise derogate from,
such measures as an encouragement for the establishment, acquisition, expansion
or retention in its territory of an investment of an investor. If a Party considers that
another Party has offered such an encouragement, it may request consultations with
the other Party and the two Parties shall consult with a view to avoiding any such
encouragement.18
This, along with other provisions in the NAFTA and the NAAEC that reinforce the
nonregression obligation, is the first of the neglected provisions; it will be examined
in more detail in Section 3.
2.2.Key Provisions of the NAAEC
The NAAEC, adopted in light of criticism that the NAFTA did not sufficiently allay
environmental concerns, expanded on the NAFTA’s environmental provisions. It
also institutionalized a cooperative program for environmental protection and con-
servation in North America in the CEC and created new mechanisms to enhance
public participation in the achievement of North American environmental objec-
tives. Two key measures included in the NAAEC to promote public participation
in the work of the CEC are the provision for a process to receive citizen submis-
sions on enforcement matters in Articles 14 and 15, and the creation of the Joint
Public Advisory Committee (JPAC),19 which engages the North American public in
15 Ibid., Article 906(1).
16 Ibid., Article 906(2).
17 Indeed, the NAFTA Secretariat reports that only three disputes have been filed under the Arti-
cle 20 dispute resolutions proceedings, none directly involving an environmental issue. See NAFTA
Secretariat, “Dispute settlement, decisions and reports,” http://www.nafta-sec- alena.org/Default.aspx?
tabid=95&language=en-US.
18 NAFTA, Article 1114(2).
19 See NAAEC, Article 16.TheJPACisa15-member committee made up of five citizens from each
country, whose mandate is to provide advice to the CEC Council on any matter covered by NAAEC.
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20 Geoffrey Garver
order to fulfill its mandate to advise the CEC council on the implementation of the
NAAEC.
In regard to enhancing levels of environmental protection without regression, the
preamble of the NAAEC reaffirms “the importance of the environmental goals and
objectives of the NAFTA, including enhanced levels of environmental protection.”20
This principle reappears among the objectives of the agreement set out in Article 1,
the first of which is to “foster the protection and improvement of the environment in
the territories of the Parties for the well-being of present and future generations.”21
By stating a goal of enhancing or improving the environment and environmental
protection, these provisions evidence an intention to establish a policy against regres-
sion of environmental protections. This implied principle of nonregression is carried
forward in the obligations of the NAAEC Parties in Article 3, which states:
Recognizing the right of each Party to establish its own levels of domestic envi-
ronmental protection and environmental development policies and priorities, and
to adopt or modify accordingly its environmental laws and regulations, each Party
shall ensure that its laws and regulations provide for high levels of environmental
protection and shall strive to continue to improve those laws and regulations.22
Clearly, however, the obligation to “strive to continue to improve” environmental
laws and regulations is only an implied obligation not to weaken them, and even so,
the obligation would be stronger if it were simply “to improve” them. Yet Article 3
is the clearest expression in the NAAEC of a nonregression principle that reinforces
the NAFTA’s Article 1114(2).
Other provisions of the NAAEC provide additional reinforcement of the weak
nonregression obligation in the NAFTA and the NAAEC. Article 10(3)(b) states that
[t]he Council shall strengthen cooperation on the development and continu-
ing improvement of environmental laws and regulations, including by . .. without
reducing levels of environmental protection, establishing a process for developing
recommendations on greater compatibility of environmental technical regulations,
standards and conformity assessment procedures in a manner consistent with the
NAFTA.23
Article 10(6)(b) gives the CEC Council a direct role in the implementation of
NAFTA Article 1114(2), requiring it to
provid[e] assistance in consultations under Article 1114 oftheNAFTAwhereaParty
considers that another Party is waiving or derogating from, or offering to waive
or otherwise derogate from, an environmental measure as an encouragement to
20 Ibid., Preamble [emphasis added].
21 Ibid., Article 1(a).
22 Ibid., Article 3.
23 Ibid., Article 10(3)(b) [emphasis added].
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Forgotten Promises 21
establish, acquire, expand or retain an investment of an investor, with a view to
avoiding such encouragement.
To allay concerns that Canada, Mexico, or the United States would use weak environ-
mental enforcement to gain economic advantages, Article 5of the NAAEC requires
“each Party [to] effectively enforce its environmental laws and regulations” “with
the aim of achieving high levels of environmental protection and compliance with
its environmental laws and regulations.”24 Article 5also includes a list of potentially
appropriate governmental action in fulfilling that obligation. The wording of Article
5pairing effective environmental enforcement with high levels of environmental
protection suggests, again by implication, that weakening enforcement would be a
form of environmental regression that would run counter to the NAAEC.
Articles 6and 7enhance the requirements of Articles 3and 5by requiring the Par-
ties to ensure access to private remedies for environmental harms and to ensure that
the Parties’ administrative, quasijudicial, and judicial proceedings allow remedies
for environmental harms and accord procedural guarantees. The SEM mechanism
in Articles 14 and 15 and the Party-to-Party dispute resolution process in Part V sub-
ject the Party’s enforcement obligation in Article 5to independent review. Part V,
the second neglected provision examined in this Chapter, is discussed in detail in
Section 1.4.
The NAAEC also put into effect provisions regarding environmental impact assess-
ment, an important tool for considering holistically the environmental implications
of economic development, including cumulative effects and other impacts that can
contribute to providing an overview of the scale effects of economic activities (that
is, more trade-stimulated economic activity means more impact). Article 2(1)(e) obli-
gates each Party to “assess, as appropriate, environmental impacts.”25 Article 10(6)(g)
requires the CEC Council to “consider[] on an ongoing basis the environmental
effects of the NAFTA.” Article 10(7) states:
Recognizing the significant bilateral nature of many transboundary environmental
issues, the Council shall, with a view to agreement between the Parties pursuant to
this Article within three years on obligations, consider and develop recommenda-
tions with respect to:
a. assessing the environmental impact of proposed projects subject to decisions
by a competent government authority and likely to cause significant adverse
transboundary effects, including a full evaluation of comments provided by
other Parties and persons of other Parties;
b. notification, provision of relevant information and consultation between Parties
with respect to such projects; and
c. mitigation of the potential adverse effects of such projects.
24 Ibid., Article 5(1).
25 Ibid., Article 2(1)(e).
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22 Geoffrey Garver
The unsuccessful implementation of Article 10(7), the third neglected provision
examined in this chapter, is discussed in detail in Section 5.
3.nafta article 1114(2): an impotent shield against
environmental backsliding
A policy and at least a soft obligation not to weaken environmental protections
is established both by explicit provisions like the NAFTA’s Article 1114(2) and by
other provisions discussed in Section 1.2, which strongly imply that environmental
backsliding runs counter to the spirit and letter of both the NAFTA and the NAAEC.
Investigations to determine whether a race to the bottom in environmental protection
has resulted from the NAFTA have not revealed any clear economic shifts as a
result of differences in levels of environmental protection in the three countries.26
Examples of environmental backsliding do appear to exist, however, and illustrate
the weakness of the nonregression provisions in the NAFTA and the NAAEC.27 The
failure of the NAFTA governments to formally raise concerns regarding such cases
has left the potential of NAFTA Article 1114(2) untapped and undeveloped.
3.1.Examples of Post-NAFTA Environmental Backsliding
In Canada, the most prominent recent examples of the weakening of environmental
protection were adopted as part of the federal budget implementation acts of 2009,
2010, and 2012, in which significant rollbacks of environmental law were effected
under the guise of budgetary and fiscal measures, and were thus subjected to little
public scrutiny or debate. The most severe of these, the Jobs, Growth and Long-term
Prosperity Act28 and the Jobs and Growth Act, 2012, which together implemented
the 2012 federal budget, plainly weaken Canadian environmental protections in
several ways. Most notably, these Acts (1) amended the federal Species at Risk Act
(SARA)29 by eliminating the five-year term limit on permits to engage in activ-
ities that affect species protected by SARA or their critical habitat, and exempted
certain pipeline projects from the requirement to respect reasonable measures to pro-
tect critical habitat of species protected under SARA;30 (2) replaced the Canadian
Environmental Assessment Act, 1992, with the Canadian Environmental Assess-
ment Act, 2012, which greatly reduced the number of projects subject to federal
26 See Chris Wold, “Taking stock: Trade’s environmental scorecard after twenty years of ‘trade and
environment’” (2010)45:2Wake Forest L. Rev.319 at 334. C.f. Block, “Trade and Environment,”
p. 503.
27 See Ignacia S. Moreno et al., “Free trade and the environment: The NAFTA, the NAAEC, and
implications for the future” (1999)12:2Tulane Envtl. L. J.405 at 433.
28 SC 2012,c.19.
29 SC 2002,c.29.
30 Jobs, Growth and Long-term Prosperity Act, ss. 163,165.
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Forgotten Promises 23
environmental assessment, reduced the number of factors to be considered in con-
ducting assessments, shortened the time for completing environmental screenings
and full environmental assessments, and limited opportunities for public participa-
tion by tightening the criteria for members of the public wishing to participate in
a federal environmental assessment;31 and (3) weakened the federal Fisheries Act
by increasing the level of harm to fish or fish habitat that would need to be shown
in order to prove a violation of the Act, reducing the kinds of fisheries subject to
the Act, and expanding the ability of the federal government to exempt activities or
undertakings from the Act even if they cause harm to fish or fish habitat.32
The Jobs and Economic Growth Act,33 which implemented the 2010 budget,
weakened several provisions of the Canadian Environmental Assessment Act, 1992,34
for example, by giving the federal government increased discretion to limit or elim-
inate the application of environmental impact assessment requirements for certain
projects and activities.35 The Budget Implementation Act, 2009,36 weakened the
scope of the Navigable Waters Protection Act by limiting the types of activities and
projects that require environmental impact assessment and other review.37
Canada’s abandonment in 2011 of its obligations to reduce emissions of green-
house gases under the Kyoto Protocol on climate change38 and its related repeal in
2012 of the Kyoto Protocol Implementation Act39 are further examples of backward
movement on environmental protection.40 Likewise, Canada’s apparent reduction
of its federal environmental spending by roughly forty percent in the period 1993 to
1997 could itself be seen as a form of regression.41
In Mexico, one example of regression in environmental protection since 1994 was
the dilution in 2004 of a regulation on the protection of wetlands and mangroves.42
Noting that environmental improvements in Mexico that some expected NAFTA
31 Ibid., s. 52.
32 Ibid., ss. 13256.
33 RSC 2010,c.12.
34 See ibid., ss. 215371.
35 Ibid., s. 2155. See letter from Richard D. Lindgren, Counsel, Canadian Environmental Law Associa-
tion, to James Rajotte, Chair, Standing Committee on Finance, House of Commons (13 May 2010),
http://cela.ca/publications/re- bill-c-9-proposed-changes-canadian-environmental-assessment-act.
36 RSC 2009,c.2.
37 Ibid., ss. 31740.
38 Environment Canada, Canada’s Withdrawal from the Kyoto Protocol (28 May 2012), http://ec.gc.ca/
Publications/default.asp?xml=EE4F06AE-13EF- 453B-B633-FCB3BAECEB4F.
39 Jobs, Growth and Long-term Prosperity Act, s. 699.
40 See Government of Canada, “Canada lists emissions target under the Copenhagen accord”
(2010), http://ec.gc.ca/default.asp?lang=En&news=EAF552A3-D287-4AC0-ACB8-A6FEA697ACD6
(setting emissions reduction targets for 2020 that are significantly higher than Canada’s obligations
under the Kyoto Protocol for 2012).
41 See Vaughan, “Thinking North American Environmental Management,” p. 12. See also Moreno
et al., “Free trade and the environment,” p. 437; Block, “Trade and Environment,” p. 517.
42 See Francisco Flores-Verdugo et al., “La topograf´
ıa y el hidroper´
ıodo: dos factores que condicionan la
restauraci´
on de los humedales costeros” (2007) Sup. 80 Bolet´
ın de la Sociedad Bot´
anica de M´
exico 33
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24 Geoffrey Garver
to produce have not occurred, one set of commentators contended that “Mexico’s
poor environmental record is mostly due to a weakening of the commitment to
environmental protection in the post-NAFTA period. Indeed, real spending and
inspection levels in manufacturing have declined since NAFTA, and the environ-
mental impacts have been well documented.”43
Prominent backsliding examples from the United States date back to at least 1995,
with the passage of the Emergency Supplemental Appropriations for Additional
Disaster Assistance, for Antiterrorism Initiatives, for Assistance in the Recovery from
the Tragedy that Occurred at Oklahoma City, and Rescissions Act, 1995.44 That law
created a salvage timber harvest program that reduced or eliminated the application
of the National Environmental Policy Act45 and other environmental laws to the
logging of certain salvage timber sales and some specific controversial timber sales
in the Northwestern United States.46 More recent examples47 include the repeal
in 2003 of a rule48 that had defined total maximum daily loads of water pollution
under the Clean Water Act,49 the weakening in 2003 of the regulations on the types
of modifications of major air pollution sources that would require more stringent
pollution controls under the Clean Air Act’s50 “New Source Review” provisions,51
and the rollback in 2008 of the Stream Buffer Zone rule that prohibited surface
mining activities within 100 feet of streams.52
at 35 (discussing a 2004 amendment to the Ministry of the Environment and Natural Resources’ regu-
lation NOM-022-SEMARNAT-2003 that allowed mangroves to be destroyed as long as the destruction
was compensated).
43 Eduardo Zepeda, Timothy A. Wise, and Kevin P. Gallagher, “Rethinking trade policy for development:
Lessons from Mexico under NAFTA,” Carnegie Endowment for International Peace 7December 2009,
p. 16, http://carnegieendowment.org/publications/index.cfm?fa=view&id=24271.
44 Pub. L. 10419,109 Stat. 104.
45 42 USC §§ 4321ff (1969).
46 1995 Rescissions Act, subss. 2001(b)–(d), (k). See Moreno et al., “Free trade and the environment,”
pp. 4401(discussing this law and another budgetary measure in 1995 that reduced funding of certain
environmental activities of the EPA and the U.S. Fish and Wildlife Service).
47 For a more comprehensive set of examples of alleged rollbacks in U.S. environmental laws under the
administration of President George W. Bush, see Charles Pope, “Bush uses rule book to roll back pro-
tections,” Seattle Post-Intelligencer,15 March 2005, http://www.seattlepi.com/national/216007 regs15
.html; Emily Cousins, Robert Perks, and Wesley Warren, Rewriting the Rules: The Bush Administra-
tion’s First-Term Environmental Record (New York: Natural Resources Defense Council, 2005).
48 U.S. Environmental Protection Agency, Withdrawal of Revisions to the Water Quality Planning and
Management Regulation and Revisions to the National Pollutant Discharge Elimination System
Program in Support of Revisions to the Water Quality Planning and Management Regulation, 68
Fed. Reg. 13608 (2003).
49 33 USC §§ 1251ff (1972).
50 42 USC §§ 7401ff (1955).
51 U.S. Environmental Protection Agency, Prevention of Significant Deterioration (PSD) and Non-
Attainment New Source Review (NSR): Equipment Replacement Provision of the Routine Mainte-
nance, Repair and Replacement Exclusion, 68 Fed. Reg. 61248 (2003).
52 US Department of the Interior, Final Rule on Excess Spoil, Coal Mine Waste, and Buffers
for Perennial and Intermittent Streams, 73 Fed. Reg. 75814 (2008). See also Natural Resources
Defense Council, “EPA allows mining companies to destroy America’s streams,” 2December 2008,
http://nrdc.org/media/2008/081202.asp.
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Forgotten Promises 25
A final example of post-NAFTA weakening of environmental law in the United
States underscores one of the key false promises of NAFTA: that it would open
a new era of North American integration in which new opportunities in Mexico
would reduce the incentive to migrate north. The Illegal Immigration Reform and
Immigrant Responsibility Act of 199653 authorizes the Secretary of the Department
of Homeland Security to forego all legal requirements that apply to the construction
of physical barriers (namely, a fence) and roads in the border zone between the
United States and Mexico. Between 2005 and 2008, the secretary exercised this
power five times54 in order to bypass important environmental requirements that
otherwise applied55 to the construction of fences in California and Texas along a
significant portion of the United States–Mexico border.
3.2.The Failure to Implement NAFTA Article 1114(2) and
Related Non-regression Provisions
The actual experience and practice of the Parties in the seventeen years since
the NAFTA and the NAAEC took effect confirm the weakness of the agreements’
nonregression provisions. Neither the Parties nor commentators appear to view non-
regression of environmental protections as a strict mandate. As the earlier examples
show, the Parties have on occasion weakened environmental protections with no
consequences pursuant to the NAFTA or the NAAEC. Neither the NAFTA nor
the NAAEC contains a reliable means of enforcing the nonregression provisions;
Party-to-Party consultations are the sole remedy.
Pierre-Marc Johnson and Andr´
e Beaulieu aptly describe the nonregression pro-
vision in Article 3and most of the other Party obligations in the NAAEC as “akin
to unilateral declarations of intention since they are not enforceable under the
NAAEC.”56 Noting that the NAAEC contains fact-finding and reporting provisions
that may help bring to light the Parties’ conformity with these obligations, they
claim “[i]t will necessarily fall to NGOs and, to a lesser extent, to the Secretariat
to monitor the implementation of these obligations and publicize governmental
lapses.”57 As for the nonregression language in the NAFTA itself, commentators have
53 Pub. L. 104208,Div.C,110 Stat. 3009546, as amended by the REAL ID Act of 2005, Pub. L. 10913,
Div. B, 119 Stat. 302, as amended by the Secure Fence Act of 2006, Pub. L. 109367,120 Stat. 2638,
as amended by the Department of Homeland Security Appropriations Act, 2008, Public Law 11061,
Div. E, Title V, s. 564,121 Stat. 2090 (2007).
54 See 70 Fed. Reg. 55622 (22 September 2005), 72 Fed. Reg. 2535 (19 January 2007), 72 Fed. Reg. 60870
(26 October 2007), 73 Fed. Reg. 19077 (8April 2008), 73 Fed. Reg. 19078 (8April 2008).
55 The exempted laws include the National Environmental Policy Act; the Endangered Species Act; the
Clean Water Act; the Clean Air Act; the Safe Drinking Water Act; the Resource Conservation and
Recovery Act; the Comprehensive Environmental Response, Compensation and Liability Act; and
the Migratory Bird Treaty Act.
56 Johnson and Beaulieu, The Environment and NAFTA,p.146.
57 Ibid., p. 149.
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26 Geoffrey Garver
characterized NAFTA Article 1114(2) as a statement of “common policy” that “is not
mandatory.”58
The practice of the Parties supports these views. First, despite instances of envi-
ronmental backsliding, no Party has initiated consultations regarding regression of
environmental protections as provided for in NAFTA Article 1114(2), and the rollback
of environmental laws and regulations has never been on the agenda of the CEC
Council, despite the mandate they are conferred in NAAEC Article 10(6)(b). Sec-
ond, the NAFTA Parties have established neither criteria indicating what qualifies as
regression of environmental protections or procedures nor guidelines for consulta-
tions or other means of enforcing the nonregression provisions. Simply put, formal or
informal enforcement of those provisions has never been part of the CEC’s agenda,
and it is difficult to imagine the Parties departing from their record of inaction. The
Parties’ triple roles as members of the CEC Council, which oversees the NAAEC;
as governments subject to the NAAEC’s provisions; and as partners in the CEC’s
cooperative programs create inherent conflicts and disincentives in the enforce-
ment of Article 3and other NAAEC obligations that make progress on meaningful
implementation of the nonregression provisions a formidable challenge.59
Whether the examples of environmental backsliding mentioned in the previ-
ous section are treaty violations undoubtedly raises issues of interpretation under
NAFTA Article 1114(2) or the various provisions of the NAAEC that reinforce the
nonregression obligation. In Article 1114(2), what kinds of environmental measures
are considered relevant, what is the meaning of the terms “waive” and “otherwise
derogate from,” and what kind of “encouragement for the establishment, acquisi-
tion, expansion or retention in its territory of an investment of an investor” must
be shown? Given the very soft nature of the sole remedy of consultation, one
would expect these terms to be given a broad and liberal meaning.60 However, the
58 Sanford E. Gaines, “Protecting investors, protecting the environment: The unexpected story of NAFTA
chapter 11,” in David L. Markell and John H. Knox (eds.), Greening NAFTA: The North American
Commission for Environmental Cooperation(Stanford, CA: Stanford University Press, 2003), p. 173,
p. 195,note44. See also Vaughan, “Thinking North American Environmental Management,” p. 8.
59 This inherent conflict of interest has received considerable attention in the context of Articles 14 and
15, but the Council has taken virtually no action to alleviate those concerns. See JPAC, “Advice to
Council 0305”(2003), http://cec.org/Page.asp?PageID=122&ContentID=1274 (noting “an emerging
perception of Council being in conflict of interest” and recounting public testimony at a JPAC
meeting that “Council is having a hard time differentiating their role-when they are acting as a
Council and when they are acting individually as Parties”); Geoff Garver, “Tooth decay” (2008)25:3
The Environmental Forum 34 at 38 (“[p]roviding the CEC secretariat with greater discretion to define
the scope of factual record investigations would address a fundamental concern about the process: the
inherent conflict of interest that the NAFTA governments face in being both council members who
vote on factual records and also, since the council is composed of the three countries’ environmental
ministers, targets of individual submissions”); David Markell, “The role of spotlighting procedures in
promoting citizen participation, transparency and accountability” (2010)45:2Wake Forest L. Rev.425
at 440.
60 Certainly, the Canadian prime minister’s statements to Latin American investors in April 2012 that
touted recent changes to Canadian environmental law as a reason to invest in resource development
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Forgotten Promises 27
government Parties – both individually and together as the CEC Council – have
done nothing to provide clarity on these questions.
4.part v of the naaec: a pandora’s box that will never
be opened
Part V of the NAAEC (Articles 22 to 36) explicitly targets widespread or systemic
failures to effectively enforce environmental laws in the NAFTA countries and
establishes Party-to-Party dispute resolution with potential sanctions as the remedy.
Article 22 provides that “[a]ny Party may request in writing consultations with any
other Party regarding whether there has been a persistent pattern of failure by that
other Party to effectively enforce its environmental law.”61 If consultations fail to
resolve the matter, the council can appoint an arbitral panel to prepare a report and,
if necessary, assess a “monetary enforcement assessment.”62 Article 36 provides that
failure to pay a monetary enforcement assessment can lead to suspension of benefits
under the NAFTA. When the NAAEC was negotiated, Part V was seen as the teeth
sought by environmentalists to hold the governments to account in the event of weak
environmental enforcement.63
None of the NAAEC Parties has ever put Part V to the test by initiating a dispute
with another Party. In fact, twenty years after the NAAEC took effect the Parties
have not adopted rules of procedure for Part V, as required under Article 28, and
they have not developed a roster of arbitrators, as called for under Article 25.
As time progresses, Part V looks more and more like a set of “false teeth” included
in the NAAEC in order to ensure the NAFTA’s approval by the United States
Congress.64 There are good reasons to believe that the NAAEC governments will
never put Part V to use because of political dynamics built into the structure of
Part V and because of past recommendations that a moratorium be placed on its
implementation.
The structural obstacles to implementation and use of Part V are significant.65
NAAEC defines a “persistent pattern” for the purposes of Article 22 as “a sustained
or recurring course of action or inaction beginning after the date of entry into force
of this Agreement.”66 The agreement also provides that A Party has not failed to
in Canada would seem to qualify squarely as the kind of encouragement that Article 1114(2)was
intended to dissuade. See John Vizcaino, “Stephen Harper sells resource-friendly economy to Latin
American execs,” Toronto Star,12 April 2012, http://thestar.com/business/2012/04/14/stephen harper
sells resourcefriendly economy to latin american execs.html.
61 NAAEC, Article 22(1).
62 See ibid., Articles 23,24,314.
63 See Vaughan, “Thinking North American Environmental Management,” p. 9.
64 See ibid., pp. 79.
65 See ibid., pp. 913.
66 NAAEC, Article 45(1).
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28 Geoffrey Garver
“effectively enforce its environmental law” . . . where the action or inaction in
question by agencies or officials of that Party:
(a) reflects a reasonable exercise of their discretion in respect of investigatory,
prosecutorial, regulatory or compliance matters; or
(b) results from bona fide decisions to allocate resources to enforcement in respect
of other environmental matters determined to have higher priorities.67
To succeed in a Part V dispute, a Party would have to overcome these vague
definitions in establishing its case and fending off potential defenses and would also
have to show that the alleged failure to effectively enforce environmental law
relates to a situation involving workplaces, firms, companies, or sectors that produce
goods or provide services:
(a) traded between the territories of the Parties; or
(b) that compete, in the territory of the Party complained against, with goods or
services produced or provided by persons of another Party.68
Consequently,
the outcome will be much less certain than in a typical trade dispute, with com-
pletely different stakes and a greater potential for backfiring. [Further,] every plaintiff
in these dispute resolution processes is also a potential defendant in a future case,
and therefore has a reduced incentive to develop the strongest possible arguments
favoring the plaintiff position. It is hard to imagine a government arguing for an
expansive definition of what qualifies as a failure to effectively enforce, or for a lim-
ited interpretation of defenses that apply to the reasonable exercise of enforcement
discretion and bona fide allocation of resources to higher priorities.69
For all these reasons, dispute resolution under Part V of the NAAEC “is a Pandora’s
box no government is likely to open.”70
The second principal reason that Part V is not likely to be implemented is fears that
even the potential for Part V dispute proceedings renders the SEM mechanism under
the NAAEC’s Articles 14 and 15 less effective.71 Article 14 allows any person residing
or nongovernmental organization established in North America to file a submission
with the secretariat of the CEC asserting that one of the NAAEC Parties is failing to
effectively enforce its environmental laws. The secretariat can “request[] a response
67 Ibid.
68 Ibid., Article 24.
69 Garver, “Tooth decay,” p. 39. See also Vaughan, “Thinking North American Environmental Man-
agement,” pp. 910.
70 Garver, p. 39.
71 See Vaughan, “Thinking North American Environmental Management,” pp. 1112; Johnson et al.,
“Ten Years of North American Environmental Cooperation,” p. 38.
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Forgotten Promises 29
from the Party”72 and then recommend the development of a factual record to the
council.73 With a two-thirds majority vote of the council,74 the secretariat conducts
a detailed investigation into the allegations and produces a factual record,75 which
requires a two-thirds majority vote of the council for publication.76 A factual record
provides information that allows members of the public to decide for themselves if
the Party has failed to effectively enforce its laws, but it may not provide a conclusion
of its own, make recommendations, or require a remedy.
The SEM process has a long history of controversy, linked mostly to the fact that
the NAAEC Parties have dual roles both as members of the council voting on the
preparation and publication of factual records and overseeing the process, and as
individual Parties that are targeted by the process. Perhaps as a consequence, contrary
to the apparent purpose of the process, the council has severely restricted the ability of
submitters to raise widespread, systemic cases of weak enforcement that are the types
of assertions most likely to reveal a weak regime of environmental protection.77 In
recommending the production of a factual record in response to the Migratory Birds
submission, the secretariat noted that submissions raising widespread or systemic
allegations of ineffective enforcement are especially suited to the process:
[A]ssertions that the failure to enforce extends beyond a single facility or project
portend, at least potentially, a more extensive or broad-based issue concerning the
effectiveness of a Party’s efforts to enforce its environmental laws and regulations. In
other words, the larger the scale of the asserted failure, the more likely it may be to
warrant developing a factual record, other things being equal. If the citizen submis-
sion process were construed to bar consideration of alleged widespread enforcement
failures, the failures that potentially pose the greatest threats to accomplishment of
the Agreement’s objectives, and the most serious and far-reaching threats of harm
to the environment, would be beyond the scope of that process.78
Nonetheless, in voting to authorize factual records, the council has on several
occasions either limited the scope of the factual records to isolated incidents that
were not the main focus of the submissions, or required submitters to provide
specific evidence for all cases involved in a widespread or systemic pattern of weak
enforcement.79
72 NAAEC, Article 14(2).
73 Ibid., Article 15(1).
74 Ibid., Article 15(2).
75 Ibid., Article 15(2)–(6).
76 Ibid., Article 15(7).
77 See John H. Knox and David L. Markell, “Evaluating citizen petition procedures: Lessons from an
analysis of the NAFTA Environmental Commission” (2012)47:3Texas Intl. L. J.505 at 5256.
78 SEM-99002 (Migratory Birds), Recommendation pursuant to Article 15(1)(15 December 2000),
p. 10.
79 See especially SEM-97006 (Oldman River II), Council Resolution 0108 pursuant to Article 15(2)(16
November 2001); SEM-99002 (Migratory Birds), Council Resolution 0110 pursuant to Article 15(2)
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30 Geoffrey Garver
As a result of the limitations imposed by the council on the scope of factual
records and other aspects of the process, the SEM mechanism has not lived up to
its potential.80 Moreover, the governments’ mostly tepid responses to factual records
to date suggest this is not a particularly promising means to hold the Parties to
account for weak enforcement. The NAAEC does not require a government that
is the subject of a factual record to take any action or to respond in any other way
following its publication. Despite calls to make some kind of commitment to follow
up on factual records, the council has stated firmly in the past that the follow-up
to factual records is a matter of domestic policy of the individual governments.81
More recently, the council adopted measures that “call for Parties to follow up
on concluded submissions with information on any new developments and actions
taken regarding matters raised in such submissions.”82 Nonetheless, the impact of
the submissions process and factual records has been modest to date, with some
positive effects in specific cases.83 In cases such as the Migratory Bird and Pulp and
Paper factual records, the process had no discernible impact on the enforcement
practices of the government concerned.
One reason suggested to explain the council’s action to limit claims of widespread
failures to enforce environmental law under Articles 14 and 15 is that these cases
might establish the “pattern” required to succeed in a dispute proceeding under
Part V.84 Perhaps it is an awareness that Part V is likely to remain dormant, given its
Byzantine procedures and the daunting challenge in raising a successful case, that
has prompted calls for a moratorium on Part V consultations, in order to encourage
the SEM process, which has been active, to produce more effective results.85
In the governance proposal that accompanies the CEC strategic plan for 2010
to 2015,86 the Council indicated that it could direct officials representing the three
governments to resume negotiation of model rules for the NAAEC Part V dispute
resolution process, which the Parties had undertaken from 1997 to 2000. However,
the Parties have not resumed negotiations as of February 2014.
(16 November 2001); SEM-98004 (BC Mining), Council Resolution 0111 pursuant to Article 15(2)(16
November 2001); SEM-00004 (BC Logging), Council Resolution 0112 pursuant to Article 15(2)(16
November 2001); SEM-02001 (Ontario Logging), Council Resolution 0305 pursuant to Article 15(2)
(22 April 2003); SEM-02003 (Pulp and Paper), Council Resolution pursuant to 0316 (11 December
2003). See also Block, “Trade and Environment,” p. 541; Garver, “Tooth decay,” pp. 367.
80 For a summary of other limitations the Council has imposed, see Garver, “Tooth decay.”
81 See letter from Alternative Representative for Canada Norine Smith to 2002 JPAC Chair Jonathan
Plaut (14 June 2002), http://cec.org/Storage/25/1591 Council- Lessons-learned-04.pdf.
82 Commission for Environmental Cooperation, “CEC Ministerial Statement, 2012,” http://cec.org/Page
.asp?PageID=122&ContentID=25241.
83 See Johnson et al., “Ten Years of North American Environmental Cooperation,” p. 46.
84 Vaughan, “Thinking North American Environmental Management,” pp. 1112.
85 Johnson et al., “Ten Years of North American Environmental Cooperation,” p. 55.
86 Commission for Environmental Cooperation, “Governance proposal,” p. 7, http://cec.org/Storage/
101/10004 Governance Proposal May 2010 final2e.pdf.
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Forgotten Promises 31
5.naaec article 10(7): a lost opportunity to expand
environmental impact assessment
Article 10(7) of the NAAEC derives from the notion in Principle 2of the 1992 Rio
Declaration on Environment and Development – building on Principle 21 of the
1972 Stockholm Declaration on the Human Environment – that “States have . . .the
responsibility to ensure that activities within their jurisdiction or control do not
cause damage to the environment of other States or of areas beyond the limits
of national jurisdiction.”87 The preamble to the NAAEC explicitly reaffirms this
principle. Article 10(7) obligates the CEC Council to develop recommendations on
various aspects of TEIA within three years of the effective date of the treaty’s entry
into force with a view to an agreement. Almost twenty years on, despite considerable
effort by the Parties, a North American TEIA agreement has not been finalized.88
The 1991 Convention on Environmental Impact Assessment in a Transboundary
Context, or Espoo Convention, to which Canada is a Party, provides a prototype
for assessing transboundary environmental impacts through an international agree-
ment. In addition, Canada, Mexico, and the United States all have federal and
subnational laws and regulations on environmental impact assessment that, despite
differences, could form the building blocks for a North American TEIA agreement.
The challenge under the NAAEC has been to create reciprocal TEIA obligations
using existing domestic requirements on environmental impact assessments.
Negotiation of a TEIA draft text began after the CEC Council instructed nego-
tiators in 1995 to be guided by overarching principles for TEIA that emphasized the
transboundary nature of pollution, good neighborliness, respect for existing national
and subnational processes, cost effectiveness and efficiency, complementarity, and
public participation.89 These overarching principles formed the basis of the Parties’
efforts from 1996 to 1999 to negotiate the recommended draft text of a TEIA agree-
ment. The CEC Secretariat facilitated the negotiations by providing background
analysis and by hosting, at its Montreal headquarters office, meetings of a trinational
working group of Party delegates. Consistent with the text of Article 10(7), the nego-
tiations focused on Party-to-Party notification of projects and provision of relevant
information, the actual assessment of transboundary environmental impacts, consul-
tations between Parties regarding any conflicts in regard to transboundary impacts,
and mitigation of adverse impacts.90
87 Rio Declaration on Environment and Development, UNEP, 1992,UNDoc.A/Conf.151/Rev. 1,31
ILM 874, Principle 2.
88 Much of the chronology of the TEIA negotiations is drawn from Geoffrey Garver and Aranka Podhora,
“Transboundary environmental impact assessment as part of the North American Agreement on
Environmental Cooperation” (2008)26:4Impact Assessment and Project Appraisal 253.
89 Commission for Environmental Cooperation, “Council resolution 9507”(13 October 1995).
90 The author was a member of the U.S. delegation at those negotiations.
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32 Geoffrey Garver
In June 1999, despite the completion of a nearly complete draft text,91 the
negotiations broke down because of difficulty establishing reciprocity on the treat-
ment of projects subject to approval only by subnational (as opposed to federal)
governments.92 In a June 1999 communiqu´
e, the CEC Council seemed to indicate
a shift to “‘good neighbor’ agreements based on reciprocity” between subnational
governments, such as individual states or provinces.93
Since 1999, despite pressure from the JPAC,94 progress toward resuming negotia-
tion of a TEIA agreement has been slow, and the role of the CEC has diminished.
In its communiqu´
e following the annual council session in 2001, the council stated
simply that “[w]ith respect to transboundary environmental impact assessment, an
informal, productive process is continuing.”95 In a March 2003 letter to the JPAC
that makes the lack of movement clear, the council stated:
Although substantial progress has been made in the development of the TEIA
agreement, the Parties have had difficulty in agreeing on the manner in which the
Agreement would address projects subject to approval at the sub-Federal level, due
to differences in the Federal systems of each country. Government to government
contacts are continuing to explore potential solutions to this problem.96
In 2004, funding for support of implementation of Article 10(7) was eliminated
entirely from the CEC budget.97
The three governments subsequently announced that under the Security and
Prosperity Partnership (SPP), which Canada, Mexico, and the United States under-
took in 2005, they would “[s]eek to conclude a transboundary environmental impact
91 Commission for Environmental Cooperation, Draft North American Agreement on Transbound-
ary Environmental Impact Assessment (October 1997), http://cec.org/Storage/92/8900 Draft-TEIA
Agreement-Oct97 en.doc.
92 The CEC Council stated in 1999 that “Council members agreed to work with their respective
negotiators and individual border states and provinces to build ‘good neighbor’ agreements based
on reciprocity.” Commission for Environmental Cooperation, “Council communiqu´
e–1999,”
http://cec.org/Page.asp?PageID=122&ContentID=1292.
93 Ibid.
94 Commission for Environmental Cooperation, “JPAC advice to Council 0212,” 10 December 2002,
http://cec.org/Page.asp?PageID=122&ContentID=992.
95 Commission for Environmental Cooperation, “CEC Council communiqu´
e–2001,” http://cec.org/
Page.asp?PageID=122&ContentID=1290.
96 Letter from Judith Ayres, Assistant Administrator, Office of International Affairs, United States Envi-
ronmental Protection Agency, to JPAC Chair Gustavo Alanis-Ortega (24 March 2003), http://cec.org/
Storage/24/1583 Counci-Response- 02-12 en.pdf.
97 Commission for Environmental Cooperation, Operational Plan: 2004–2006 (2004), p. 48, http://cec
.org/Storage/27/1791 2004-OperationalPlan en.pdf . The government of Canada has said the Council
met its obligations under Article 10(7)in1997, before the draft TEIA agreement was even com-
pleted. See “Joint response from the Departments of Environment, Foreign Affairs and International
Trade, and Transport [to the] petition submitted by [the] Sierra Legal Defence Fund concerning the
implementation of the North American Agreement on Environmental Cooperation,” 9August 2006,
http://oag-bvg.gc.ca/internet/English/pet 166 e28901.html.
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Forgotten Promises 33
assessment cooperation agreement for proposed projects by June 2007.”98 The SPP
set out a policy framework for North American security and prosperity but had no
formal connection to the NAFTA, the NAAEC, or the CEC. TEIA negotiations
made little progress through the SPP.99
In 2011, following a public meeting that included a discussion of the NAAEC’s
Article 10(7) and the negotiation of a TEIA agreement, the JPAC advised the council
as follows:
Noting that efforts to pursue a North American TEIA agreement through the Secu-
rity and Prosperity Partnership have ceased, JPAC supports the renewal of efforts
to finalize a North American TEIA agreement, consistent with Article 10(7)ofthe
NAAEC. . . . JPAC [recommends] that the Council approve a review of case studies
of projects or activities in North America with transboundary impacts, develop pilot
projects for implementing TEIA mechanisms with respect to specific projects, and
direct the Secretariat to commission a short and focused review of lessons learned
in the implementation in Europe of the Convention on Environmental Impact
Assessment in a Transboundary Context.100
In response,101 the council referred to the governance proposal that accompanies
the CEC strategic plan for 2010 to 2015,102 which notes that the council could direct
its officials to resume discussions pursuant to NAAEC Article 10(7). The council
also said it would “consider opportunities that demonstrate the most efficient and
effective means to implement [TEIA] mechanisms” and that it remains open to
relevant reviews by the secretariat.103 Neither the council nor the secretariat has
proceeded with any activities related to TEIA since that time.
6.conclusion
Global and regional ecological challenges related to climate change, biodiversity
loss, excessive human introduction of nitrogen and phosphorous, overfishing, and the
use of land and fresh water have steadily grown more pressing in the past twenty years
98 Security and Prosperity Partnership, “Report to leaders, June 2005,” http://spp-psp.gc.ca/eic/site/
spp-psp.nsf/eng/00098.html.
99 See Security and Prosperity Partnership of North American, “Prosperity priorities,” http://spp-psp.gc
.ca/eic/site/spp- psp.nsf/eng/00052.html.
100 JPAC, “Advice to Council no: 1101,” http://cec.org/Page.asp?PageID=122&ContentID=17599.
101 Letter from Dan McDougall to Irasema Coronado, 17 June 2011, CEC Council response to JPAC
Advice 1101, http://cec.org/Storage/127/15201 Letter from Council -JPAC Advice 11-01.pdf .
102 Commission for Environmental Cooperation, “Proposal to examine the governance of the CEC and
the implementation of the NAAEC,” http://cec.org/Storage/101/10004 Governance Proposal May
2010 final2e.pdf.
103 Letter from Dan McDougall to Irasema Coronado, 17 June 2011, CEC Council response to JPAC
Advice 1101, http://cec.org/Storage/127/15201 Letter from Council -JPAC Advice 11-01.pdf .
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34 Geoffrey Garver
along with awareness of them.104 International trade is increasingly a driver of these
challenges.105 These trends make clear the urgency of developing strong measures to
prevent backsliding in environmental protection, to ensure effective enforcement,
and – most critically106 – to counter the ecologically negative scale effects of expanded
economic activity. The ongoing risk of economic crises such as the global recession of
2008 and 2009, which can tempt governments to roll back environmental regulation
or enforcement and to expediently promote environmentally damaging development
in order to stimulate economic growth and job creation, underscores the need for
such protections.
Are the NAFTA and the NAAEC suitable occupants of their policy space, and
are they allowing governments the potential to use all of the tools at their disposal
to drive a transition to an economy that lives within ecological limits? The evidence
is scant that they are. The three provisions discussed in this chapter were adopted to
provide key guarantees that liberalized trade would promote stronger environmental
protection and enforcement and improved analysis of environmental impacts to
address scale effects. Not only have these been ignored in the context of the NAFTA
and the NAAEC, but versions of the NAFTA’s Article 1114(2) have also come to
appear in virtually every subsequent trade deal that the United States and Canada
have entered into,107 and versions of Part V of the NAAEC appear in most subsequent
United States trade agreements.108 These empty provisions take up policy space that
104 See Johan Rockstr¨
om et al., “Planetary boundaries: Exploring the safe operating space for humanity”
(2009)14:2Ecology and Society 32, http://ecologyandsociety.org/vol14/iss2/art32/; James Gustave Speth,
The Bridge at the Edge of the World: Capitalism, the Environment and Crossing from Crisis to
Sustainability (New Haven, CT: Yale University Press, 2008), pp. 15.
105 See Hails et al., The Living Planet Report, pp. 289.
106 See generally Vaughan, “Thinking North American Environmental Management.”
107 See, e.g., Free Trade Agreement between Canada and the Republic of Colombia, Lima, 21 Novem-
ber 2008, in force 15 August 2011, Can. TS 2011 No. 11, Article 815; Free Trade Agreement between
Canada and the Republic of Panama, Ottawa, 14 May 2010,inforce1April 2013, Can. TS 2013
No. 9, Article 9.16; Free Trade Agreement between Canada and the Republic of Peru, Lima, 29
May 2008,inforce1August 2009, Can. TS 2009 No. 15, Article 809; Free Trade Agreement between
the Government of Canada and the Government of the Republic of Chile, Santiago, 5Decem-
ber 1996, in force 5July 1997, Can. TS 1997 No. 50, Article G-14; Dominican Republic–Central
America–United States Free Trade Agreement, 28 May 2004,(2004)43 ILM 514, Article 17.2(2);
United States–Colombia Free Trade Agreement, 22 November 2006,inforce15 May 2012, Article
18.3(2), http://ustr.gov/trade- agreements/free-trade- agreements/colombia-fta/final- text; United States–
Peru Trade Promotion Agreement, 12 April 2006,inforce1February 2009,Article 18.3(2), http://ustr
.gov/trade-agreements/free-trade-agreements/peru-tpa/final-text; United States–Panama Trade Pro-
motion Agreement, 28 June 2007, not yet in force, Article 17.3(2), http://ustr.gov/trade-agreements/
free-trade-agreements/panama-tpa/final-text; United States–Chile Free Trade Agreement, 6June
2003,inforce1January 2004,(2003)42 ILM 1026, Article 19.2(2); United States–Australia Free Trade
Agreement, 18 May 2004,inforce1January 2005,(2004)43 ILM 1248, Article 19.2(2).
108 See, e.g., US–Colombia FTA, Articles 18.3(1), 18.12; CAFTA, Articles 17.2(1), 17.10; US–Peru TPA,
Articles 18.3(1),18.12; US–Panama TPA, Articles 17.3(1), 17.11; US–Chile FTA, Articles 19.2(1), 19.6;
US–Australia FTA, Articles 19.2(1), 19.7.
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Forgotten Promises 35
might otherwise be occupied by effective innovations able to address the aggregate
ecological effects of an increasingly globalized economy.
The NAFTA governments know how to adopt more rigorous tools if they want to.
They did so in the NAFTA’s Chapter 11 by waiving their sovereign immunity so as to
allow private investors to seek monetary awards for breach of the NAFTA’s investor
protections through binding arbitration.109 The dispute settlement mechanism in
Part V of the NAAEC, submissions on enforcement matters under the NAAEC’s
Articles 14 and 15, and the environmental consultations otherwise allowed under the
NAAEC or the NAFTA are at best weak cousins to the investor dispute mechanism
in the NAFTA.110 In light of the contribution of regional and global trade to looming
ecological challenges like climate change, this differentiation in the governmentally
granted power to access publicly financed remedies reflects a troublesome imbal-
ance. Without a meaningful attempt to hold each other to account in regard to
environmental backsliding or other environmental shortcomings, or to give critical
issues such as climate change paramount importance in regional decision making,
the perception that the NAFTA and the NAAEC are mere paper tigers against North
American ecological challenges is likely to continue and to solidify.
Overcoming the stagnancy of trade policy in North America will be difficult in
part because of the general difficulty in transforming institutions that have achieved
stability – in this case, an entire series of trade agreements built around an outdated
and unambitious approach in regard to trade and environment – even where the
conditions and assumptions under which those institutions were established have
changed significantly or have been shown to be faulty.111 This phenomenon of
maintaining “tragic institutions”112 – that is, institutions created to address an aspect
of the tragedy of the commons that have become ineffective but difficult to change –
is likely exacerbated where pressures in addition to the bureaucratic tendency to
maintain budgets and programs are considerable. In the case of the North American
approach to trade and the environment, a key factor is the expediency of reproducing
a model when doing so does not appear to come with any significant political cost.
The approach of the North American partners to international trade and the
environment is a reflection in large measure of the global approach – with the
possible exception of Europe, where for more than sixty years the European Union
member countries have accepted supranational authority in the environment and
other domains beyond trade and finance. The key features of the global trade and
109 NAFTA, Articles 111538.
110 C.f. discussion of the asymmetry in how the investor dispute provisions of Chapter 11 of the NAFTA
affects national sovereignty as compared to Articles 14 and 15 of the NAAEC, in Chris Tollefson,
“Games without frontiers: Investor claims and citizen submissions under the NAFTA regime” (2002)
27:1Yale J. Int’l. L.141 at 1457.
111 See Daniels, “Emerging commons and tragic institutions,” pp. 5201,53941.
112 Ibid.
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36 Geoffrey Garver
finance system are its increasingly doubtful assumption that mobile capital and
limited market regulation lead to long-term social and environmental well being;
its consistent undervaluation of environmental values, biodiversity, and ecological
integrity; its enduring assumption that measures to protect the environment, public
health, or other public goods or commons are disguised barriers to trade; its near
blindness to overconsumption and aggregate ecological impacts of economic activ-
ity; and its apparent assumption that comparative advantage – a bedrock justification
for international trade – remains an important factor in a world with few meaning-
ful restrictions on the movement of capital.113 In light of the momentum this set
of features encourages along a path to ecological catastrophe, the assumption that
they will ensure that boundaries between ecological security and catastrophe will
be respected must be severely questioned. Each of the elements of the institutional
infrastructure that supports the current regime of international trade and finance,
such as those included in the NAFTA and the NAAEC, should face serious scrutiny
as to their ability to respect those boundaries.
Stable institutions can help solve the tragedy of the commons, but “with a
change of circumstances and values sensible institutions can morph into tragic
institutions.”114 In the context of trade and environment in North America, a key
change in circumstances since 1994 is the significant new information regarding the
accelerating regional and global ecological crisis, especially climate change. Accord-
ing to Daniels, institutions are much more likely to be adaptive and to respond to
environmental challenges that public participation, transparency, and impact anal-
ysis can reveal if they have the capacity to (1) prepare those who control commons
resources to be flexible and adaptive, (2) be “continually expos[ed] to competing val-
ues” so as to foster integrated management of multiple values rather than single uses
of commons resources, (3) “[w]ithin sensible bounds, allow trading among users,”
(4) “[b]uild mechanisms to internalize externalities,” (5) “[p]rovide incentives for
users to conserve the commons,” (6) give legal rights to those affected by the use
of commons to challenge decisions regarding management of the commons, and
(7) “[i]f necessary, buy out interests of entrenched users.”115 With these criteria in
mind, it becomes clear that a more fundamental reform of North America’s trade
and environment model is needed – one that reckons with the aggregate scale effects
of the regional and global trade and finance regime in radical new ways.
113 See generally William E. Rees, “Globalization and sustainability: conflict or convergence?” (2002)
22:4Bull. of Sci., Tech. & Soc.249; Nathan Pelletier, “Of laws and limits: An ecological economic
perspective on redressing the failure of contemporary global environmental governance” (2010)20:2
Global Environmental Change 220.
114 Daniels, “Emerging commons and tragic institutions,” p. 565.
115 Ibid., 5668.
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