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El. knyga: Environmental Protection, China and International Trade: Greening the WTO Ban on Chinese Export Duties [Taylor & Francis e-book]

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"This book argues for a balanced approach to 'greening' the WTO ban on China's export duties without opening the floodgates to protectionism. As a result of the WTO's controversial China-Raw Materials and China-Rare Earths decisions, China is prohibited from using export duties to address any environmental problems, including those associated with climate change. This is despite a number of climate studies having suggested that Chinese export duties could be useful for reducing carbon leakage, an issue of international concern. This book puts the case for a more balanced approach. It shows that a general ban on China's export duties constrains its policy space to protect the environment, particularly in the context of climate change. The work presents feasibility tests for various legal solutions that have been discussed for adjusting the ban, and it accordingly proposes a more feasible approach that would allow China to help protect the environment without advancing protectionism. The proposed legal option provides a less protectionist alternative to export duties, namely 'export duties plus' that could be imposed in combination with supplementary restrictions on Chinese consumption. This analysis also yields insights regarding ways to correct WTO precedents, which suggests a moderate alternative response to the Appellate Body crisis within the WTO framework"--

This book argues for a balanced approach to ‘greening’ the WTO ban on China’s export duties without opening the floodgates to protectionism.

As a result of the WTO’s controversial China—Raw Materials and China—Rare Earths decisions, China is prohibited from using export duties to address any environmental problems, including those associated with climate change. This is despite a number of climate studies having suggested that Chinese export duties could be useful for reducing carbon leakage, an issue of international concern. This book puts the case for a more balanced approach. It shows that a general ban on China’s export duties constrains its policy space to protect the environment, particularly in the context of climate change. The work presents feasibility tests for various legal solutions that have been discussed for adjusting the ban, and it accordingly proposes a more feasible approach that would allow China to help protect the environment without advancing protectionism. The proposed legal option provides a less protectionist alternative to export duties, namely ‘export duties plus’ that could be imposed in combination with supplementary restrictions on Chinese consumption. This analysis also yields insights regarding ways to correct WTO precedents, which suggests a moderate alternative response to the Appellate Body crisis within the WTO framework.

The book will be a valuable resource for academics, researchers and policy-makers in the areas of International Trade Law, Environmental Law and China.

List of illustrations
xii
Acknowledgements xiii
List of Abbreviations
xv
1 Introduction
1(14)
1.1 Should WTO law allow China to use export duties to address trade-related environmental concerns and, if so, what form should these duties take?
2(3)
1.2 Trade-related environmental concerns and the controversies surrounding the use of export duties to address them
5(5)
1.2.1 Local and global environmental problems exacerbated by trade
5(1)
1.2.2 Trade-related environmental problems in China
6(2)
1.2.3 Concerns over Chinese export duties as a protectionist measure and better alternatives
8(2)
1.3 Structure of the analysis
10(5)
1.3.1 Description of Part I: setting the scene
10(1)
1.3.2 Description of Part II: the extent to which a harsh ban on Chinese export duties would constrain China's capacity to protect the environment
11(1)
1.3.3 Description of Part III: a basis under WTO law for China's use of export duties to address environmental concerns
12(3)
PART I Setting the scene: The background and reception of the WTO ban on Chinese export duties
15(26)
2 Three WTO cases against Chinese export duties
17(11)
2.1 Annex 6 of China's Protocol of Accession
17(1)
2.2 Facts of the export duties in China---Raw Materials, China---Rare Earths, and China---Raw Materials II
18(2)
2.3 The applicability of GATT Article XX to China's export duty commitments
20(5)
2.3.1 Incorporation theory
20(2)
2.3.2 Inherent right
22(1)
2.3.3 A holistic approach
22(1)
2.3.4 Integration theory
23(1)
2.3.5 Article 30(3) of the VCLT
24(1)
2.4 Defences under Article XX(b) and XX(g)
25(3)
3 The reception of the ban on Chinese export duties: Concerns, solutions, and the missing piece
28(13)
3.1 Erroneous interpretation based on an overly rigid textual analysis
28(4)
3.2 Negative implications caused by the WTO ban on Chinese export duties
32(4)
3.2.1 Environment-related concerns
32(3)
3.2.2 Inequality-related concerns
35(1)
3.3 Proposed legal solutions and the missing piece in current discussion
36(5)
PART II Preliminary analysis: Would a harsh prohibition on Chinese export duties constrain China's capacity to protect the environment?
41(60)
4 A harsh ban on export duties would prevent a country from protecting the environment under certain circumstances
43(26)
4.1 Practice of WTO members to restrict exports for environmental purposes in the period from 2009 to 2016
44(12)
4.1.1 General observations and actual examples of country practices to use export duties to reduce local or global pollution
44(10)
4.1.2 Preference for export duties over quantitative export restrictions in practice
54(2)
4.2 Environmental regulatory autonomy and regulatory preference at both the multilateral and regional levels
56(12)
4.2.1 Environmental regulatory autonomy with respect to export restrictions
56(9)
4.2.2 Regulatory preference for export duties over quantitative restrictions
65(3)
4.3 Conclusions
68(1)
5 Policy rationales behind Chinese export duties
69(20)
5.1 The possible rationales behind Chinese export duties
70(6)
5.1.1 The formation process of export duties in China
70(2)
5.1.2 Different missions of the relevant actors in deciding export duties
72(4)
5.2 China's Five-Year Plan as a trustworthy policy indicator
76(2)
5.3 The different roles of export duties in the context of Eleventh to Thirteenth Five-Year Plans (2006--2020)
78(8)
5.3.1 Period of 2006--2015: economic development as a dominant purpose
78(6)
5.3.2 Period of 2016--2020: a clear shift to environmental protection
84(2)
5.4 Conclusions
86(3)
6 A neglected issue: Negative impacts on China's capacity to fight climate change
89(12)
6.1 Measures to tackle carbon leakage
90(3)
6.2 Export duties as an alternative to import BTAs
93(2)
6.3 Chinese export duties as a credible climate policy tool
95(3)
6.4 Conclusions
98(3)
PART III Final analysis: Is there a way for China to use export duties legally in order to achieve environmental goals under WTO law?
101(122)
7 Is there a legal path to a desirable policy space for China under WTO law?
103(84)
7.1 Possible ways to alter the WTO ban through a judicial correction
104(41)
7.1.1 Feasibility to depart from WTO jurisprudence
104(6)
7.1.2 Moves by other tribunals to deviate from precedent: inspirations for the AB to reconsider the WTO ban on Chinese export duties
110(31)
7.1.3 Suggestions to loosen the grip of China---Raw Materials and China---Rare Earths in light of the new facts of Chinese export duties
141(4)
7.2 Possible ways to develop a new substantive argument
145(3)
7.3 Feasibility tests for interpretative options based on customary international law or non-WTO treaties
148(14)
7.3.1 Possibilities and challenges to apply customary international law or non-WTO treaties in settling WTO disputes
149(5)
7.3.2 Options based on customary international law
154(5)
7.3.3 Options based on non-WTO treaties
159(3)
7.4 Feasibility tests for interpretative options based on WTO law
162(10)
7.4.1 A more teleological approach in light of the environmental context in the preamble of the WTO Agreement
162(5)
7.4.2 A new interpretation that distinguishes the China---Raw Materials and China---Rare Earths decisions
167(5)
7.5 Possible ways to alter the WTO ban through a political correction
172(3)
7.6 Feasibility tests for amendments, waivers, authoritative interpretations, or Ministerial Decisions
175(10)
7.6.1 Article X:1: an amendment as a formal correction
175(3)
7.6.2 Article LX:3: a waiver as a stopgap measure
178(4)
7.6.3 Article IX:2: an authoritative interpretation as a flexible correction
182(1)
7.6.4 Article IV:1: a more flexible alternative
183(2)
7.7 Conclusions
185(2)
8 China's policy space for adopting `export duties plus' under GATT Article XX
187(24)
8.1 Tests under Articles XX(b) and XX(g)
189(6)
8.1.1 Article XX(b): Local pollution
189(3)
8.1.2 Article XX(g): Global pollution
192(2)
8.1.3 Comparing different policy spaces under Articles XX(b) and XX(g)
194(1)
8.2 First condition of the chapeau: `arbitrary or unjustifiable discrimination between countries where the same conditions prevail'
195(7)
8.2.1 Do `the same conditions' prevail?
196(1)
8.2.2 Is such discrimination `arbitrary or unjustifiable'?
197(3)
8.2.3 Differential `export duties plus' might be permitted for fighting climate change
200(2)
8.3 Second condition of the chapeau: `disguised restriction on international trade'
202(4)
8.3.1 Distinguishing between active discrimination and passive discrimination
202(1)
8.3.2 The irrelevance of the hidden protectionist aim
203(2)
8.3.3 Additional limits on the use of differential `export duties plus'
205(1)
8.4 A reality check on Chinas environmental policies targeting consumption
206(3)
8.5 Conclusions
209(2)
9 Implications of `Greening' the WTO ban on Chinese export duties
211(12)
9.1 Lessons for addressing trade-related environmental concerns
211(4)
9.1.1 Balancing environmental and economic interests
211(1)
9.1.2 Hard cases make bad law
212(2)
9.1.3 Moderation of extreme judicial outcomes is possible, but would be difficult
214(1)
9.2 Loosening the grip of precedent within the WTO's legal framework
215(2)
9.3 Preventing circumvention of WTO rules: aluminium sector as an example
217(4)
9.4 Final remarks
221(2)
Index 223
Fengan Jiang, China University of Political Science and Law.