Introduction

The Appellate Body rulings in the Shrimp–Turtle case created a new baseline for the trade and environment debate at the WTO. The Appellate Body held that Article XX GATT can be invoked to justify measures that condition market access on policies adopted by the exporting country, contrary to the approach taken by the unadopted GATT-era Tuna–Dolphin panels. Further, the Appellate Body explicitly noted that this holding applied not only to the environmental provision at issue in the case (Article XX(g)), but to most of the paragraphs of Article XX, including, significantly, XX(a) (inter alia), the “protection of public morals”(para. 121) – a rubric often claimed to encompass fundamental labor rights.

Before Shrimp–Turtle, it was conventional wisdom that trade measures targeted at other countries' environmental (or for that matter, labor) policies could not be accommodated within the Article XX framework. But, equally, it was conventional wisdom that since preferences to developing countries granted under the Generalized System of Preferences (GSP) were voluntary and non-binding, they could be withdrawn or circumscribed on the basis of matters such as labor rights compliance, without running afoul of WTO law. In general, GSP preferences have been exempted from the Most Favored Nation (MFN) requirement in Article I of the GATT, first by a waiver, and then by a Tokyo Round Decision, called the “Enabling Clause.”