Mexico Written Submissions: Panel Report

US Tuna II: Mexico (complainant) written submissions: Panel Report

Facts:

1. For over twenty years, yellowfin tuna caught by the Mexican fishing fleet in the Eastern Tropical Pacific ("ETP") have been denied effective access to the US market by virtue of various GATT and WTO inconsistent measures.
2. The essence of the current dispute relates to the prohibition of the use of a US dolphin-safe label on imports of tuna products from Mexico, while such a label is permitted to be used on tuna products from other countries, including the United States.
3. The US measures are inconsistent with the fundamental obligations of non-discrimination contained in Articles I:1 and III:4 of the GATT, because they grant other foreign tuna and tuna products an advantage in the US marketplace that has not been accorded immediately and unconditionally to Mexican tuna and tuna products, and accord Mexican tuna and tuna products treatment less favourable than that accorded to US tuna and tuna products in the US marketplace.
4. Furthermore, the US measures are inconsistent with Articles 2.1, 2.2, and 2.4 of the Agreement on Technical Barriers to Trade ("TBT Agreement") because they create unnecessary obstacles to international trade, are not based on the relevant international standard, discriminate against Mexican tuna products and tuna, and address objectives that can be addressed in a less trade restrictive manner.
5. In the ETP, there is a natural association between tuna and dolphins. This means that schools of tuna tend to aggregate and swim – to "associate" – near certain species of dolphins in ocean waters. Because the association between dolphins and tuna has long been observed in the ETP, fishermen locate schools of underwater tuna by finding and chasing dolphins on the ocean's surface and intentionally encircling them with purse seine nets to harvest the tuna underneath.
6. When the United States enacted legislation imposing restrictions on fishing in the ETP, the US vessels soon began to fish for tuna elsewhere, outside the ETP. In the case of Mexico, there was no reason for the Mexican fleet to relocate outside its natural and traditional fishing area within the ETP. However, the problem was not ignored by the Mexican fleet. Eventually, multilateral action was taken by the United States, Mexico, and other countries in the region to reduce overall dolphin mortality by establishing an international dolphin conservation program.
7. The principal US law relating to the overall issue of the protection of dolphins and other marine mammals is the Marine Mammal Protection Act of 1972, as amended (the "MMPA"). In 1988, the United States amended provisions of the MMPA to prohibit the import into the United States of any marine product, and any fish or fish product harvested where there was not a program comparable to that of the United States in minimizing the incidental taking of marine mammals. Pursuant to these amendments, in August 1990 the United States imposed an import embargo on imports of tuna from Mexico (and other countries) for failure to achieve comparability with US tuna harvesting standards that prohibited setting on dolphins. In addition to the direct ban on imports, in 1990 the United States enacted legislation that established a standard for labelling tuna products as "dolphin-safe". That law, known as the Dolphin Protection Consumer Information Act of 1990 ("DPCIA"), amended the MMPA.
8. According to this standard, with respect to tuna harvested by a vessel using purse-seine nets in the ETP, the DPCIA provided that the product could not be labelled "dolphin-safe" if caught on a trip involving intentional deployment on, or encirclement of, dolphins. Accordingly, Mexican tuna and tuna products harvested while setting on dolphins are denied the "dolphin-safe" label in the US marketplace, even if no mortality or serious injury of a marine mammal was observed. International standards part concerning change in definition of dolphin safe, and Hogarth ruling.
9. It is instructive to note that despite the evidence that dolphins and other marine mammals are killed in fisheries in the US domestic waters, the United States has not adopted requirements for the dolphin-safe label for tuna or other fish caught in those fisheries remotely comparable to the standards applied by the US regulations for the ETP.
10. Mexico did work to come to par with international standards
11. Although several US statutes, regulations and court decisions are involved, the most pertinent measures are: the United States Code, Title 16, Section 1385 ("Dolphin Protection Consumer Information Act"); the Code of Federal Regulations, Title 50, Section 216.91 ("Dolphin-safe labelling standards") and Section 216.92 ("Dolphin-safe requirements for tuna harvested in the ETP [Eastern Tropical Pacific Ocean] by large purse seine vessels"); and the ruling in Earth Island Institute v. Hogarth, 494 F.3d 757 (9th Cir. 2007).
12. As it stands, because of the Hogarth ruling and the underlying statute and regulations, Mexican tuna products containing tuna harvested by vessels using purse-seine nets in the ETP are entitled to use the "dolphin-safe" label only if an AIDCP observer was on board the vessel, and both the observer and the captain of the vessel certify "that no tuna were caught on the trip in which such tuna were harvested using a purse-seine net intentionally deployed on or to encircle dolphins, and that no dolphins were killed or seriously injured during the sets in which the tuna were caught
13. In contrast, if tuna products contain tuna harvested outside the ETP by a vessel using purseseine nets, those products are eligible for the "dolphin-safe" label simply if the captain of the vessel executes a written statement certifying that "no purse-seine net was intentionally deployed on or used to encircle dolphins during the particular voyage on which the tuna was harvested". There is no requirement of an observer. There is no requirement of participation in an international program similar to the AIDCP. Moreover, there is no requirement of an attestation that no dolphins were killed or seriously injured during the tuna fishing.
14. This requirement is not mandated for tuna fish originating in other countries.

Legal Arguments:

The US measures are inconsistent with Articles III:4 and I:1 of the GATT 1994 and Articles 2.1, 2.2, and 2.4 of the TBT Agreement.

GATT:

1. Article III.4 arguments

Amended Tuna measure is inconsistent with article III.4 of GATT.  

1. The US measures are laws, regulations and requirements affecting the internal sale, offering for sale, purchase, distribution and use of Mexican tuna products and tuna imported into the United States.
2. The alleged measures accord less favorable treatment to Mexican tuna products and tuna than that accorded to the like products of US origin and, therefore, are inconsistent with Article III.4 of the GATT 1994.
3. The jurisprudence on article III.4 is well founded. The Appellate Body in EC-Asbestos ruled that an article III.4 measure must fulfill the following conditions to fall within the inconsistency contemplated under the provision:

1. Like Product analysis:

1. Underlying principle of article III.4 is fundamentally a determination of elasticity of competitiveness of and among products (EC- Asbestos). Therefore determination involves from the stand point of consumers of the product. Whether they can replace one product for the other? In the instant case, Mexican Tuna is a direct competitor of US Tuna.
2. Further, EC-Asbestos chalks out four characteristics of like products:

1. Properties, nature, and use of products are similar:

Retail-ready package, processed meats.

1. End uses of the product are similar:

Identical end uses

1. Consumers taste and habits:

Identical taste habits

1. Tariff classification:

Classified under the same scheme.

1. Law, regulation, or requirement affecting their internal sale, offering for sale, purchase, transportation, distribution, or use

Dolphin safe label, which “affect” internal sale.

1. Less favorable treatment:

1. A measure accords less favorable treatment to foreign products if it alter the dynamic of competition by modifying the conditions of the competition. In other words, if it gives domestic like products a competitive advantage.
2. De-facto rather than de-jure, as not based on origin/source of product but method of harvesting the product.
3. De-facto in the following manner: Where the Tuna is harvested and the method of harvesting the Tuna.

1. Article I.1 arguments (EC Seals)

1. Like products, advantage privilege to products originating in another country, accord same advantage to like products originating in other countries?
2.  

1. US measures are inconsistent with article 2.1. of TBT:

1. For violation under 2.1. The measure must satisfy the three conditions to be found inconsistent: (i) measure must constitute a technical regulation within annexure 1.1. (ii) like product that of the domestic product (iii) treatment accorded to like imported products must be less favorable to that of like domestic products.
2. The amended Tuna fulfills all the three conditions:

1. Technical Regulation as per annexure 1.1.

1. A technical regulation is a document stipulating conditions that is mandatory. The measures may include terminology, symbols, packaging or labelling requirements, and may apply to a product, process or production method.
2. The Appellate Body in EC-Sardines found there to be a three-step test for determining whether a measure is a technical regulation:

a) The measure applies to an identifiable product or group of products;