EU-Faroe Islands Dispute - Case Study Example

EU-Faroe Islands Dispute Name Institution Course Lecturer Date The move by Denmark to challenge EU bans is supported by measures established under Art I: 1, III: 1 & 4 and XI: 1 of GATT 1994. Generally, EU measure is inconsistent with obligation under General Agreement on Tariffs and Trade (GATT 1994). All these articles offer provisions and provides respectively for the most-favoured treatment, prohibition on quantitative restrictions of imports and freedom of transit. EU has just done the opposite and contrary to the provisions by imposing import ban and prohibiting vessels flying Faroe Islands’ flag from its ports. Looking closely at Articles I:1, II:1&4 and XI, it is possible to see the intersections of regulations where EU ban on importation of fishes and prohibitions of Faroe ships from its waters meets and conclude whether it has really breached the GATT provisions (GATT, 1994). Article I.1 provides for general most-favoured-nation treatment. It requires any advantage, privilege, immunity or favour to be accorded immediately and without conditions to a party by another contracting party for products originating or destined for the territories of the other contracting party. The ban imposed on importation of fish diminishes Faroe Islands right of equal treatment. Faroe Islands has argues that it has consistently understood EU position and restrictions to its exercise of sovereign rights. In turn, it has set catch limits. The EU has failed to accord immediately and unconditionally the like products that originate from Faroe Islands in accordance to advantages, privileges, favours or immunities granted by EU to Scandian herring mackerel products that originate in other countries (Lester, 2013). Article III widely covers on national treatment and regulation. Art III:1 afford protection to domestic production; the contracting parties are required to acknowledge that laws, requirement s and regulations that affect transportation, distribution and use of a product should not be applied to imported products. Art III: 4 accord similar treatment and favour for the imported products of a territory of another contracting party in accordance to the laws, regulations and requirements that affect internal sale, transportation and distribution. Further, it prescribes that, the provision for internal transportation charges to be based exclusively on economic operation on means of transport but not on nationality of a product. Article XI: 1 deals with elimination of quantitative restrictions where no prohibitions or restrictions should be made on import. There should be no measures that should be enacted or instituted by a contracting party on importation of a product of a territory of the other contracting party sale and product destined to a territory of another contracting party. EU institutes and maintains prohibitions and restrictions other than the duties, taxes and charges on importation of products of Faroe Islands. However, there are additional provisions in XI: 2 restate that the provisions set in paragraph 1 of the Article cannot be extended to some instances like; (c) import restrictions set on agricultural or fisheries products. Any of the above products that are imported in any form that necessitates the need for enforcement and government measures cannot be covered under the restriction elimination. Subsection (iii) further restricts quantities to be permitted if imported product in the domestic market is relatively negligible. So far, the inclusion of Article XI (2) (c) and (iii) makes all the other provision void and eliminate the possibility of breach. Five coastal States including the Faroe Islands, Norway, Iceland and Russia Federation share the Atlanto Scandian herring. To some extent, European Union share part in control. Proper management of Faroe Islands has always attracted consistent mutual efforts and joint management of the relevant coastal states. UN have acted in line with the measures that are set and are necessary for coordinating and ensuring conservation and development of shared stock in Faroe Islands (MSC Assessment, 2013). However, there must be a criteria that expounds on the measures and restriction enforced by the government and negligible level of domestic production. There is an additional information that guides and elaborates on Further, and under the XI provision, it is stated that any contracting party that applies restriction on importation of any product according to sub-paragraph 9c ) should give public notice of value and total quantity of product to be permitted for importation in a future specified period. Any change of quantity or value should be stated. The additional points then lead us to consider the record of Faroe Islands in managing Atlanto Scandian herring. There have been requirements set by UNCLOS to ensure proper management and conservation measures (Lester, 2013). The measures were set forth to ensure that the maintenance of stock will not be endangered due to over exploitation. To that end, it should be noted that Faroe Islands with other coastal States have had meetings each year undertaking negotiations and agreeing on allocation and deliberating on Total Allowable Catch. Their negotiations follow the recommendation and advice from International Council for Exploration of Sea. The Council gives guidance in accordance to the mortality rate of fish and pursuant to long-term management plan as agreed by the five coastal States. EU had not imposed the ban as long as fishing was done according to management plan. However, the 2013 meeting between the five States failed to agree on allocation of Total Allowable Catch. Later on, scientific evidence that were carried in June 2013 established that Faroe Islands catch limit was set at 105 230 tons which equals to 17% as per ATC recommendations (Lester, 2013). Considering all the above facts, the EU ban on import of all fish from Faroe Islands eventually breaches the obligations as set in article I:1, III:4 and XI of GATT. Consequently, it denies Faroe Islands the sovereign rights to exercise limits by it as well as acknowledging the measures set by EU. It is noted that, there has not been a complete conservation measures that should in turn impose a total restriction to fish in Faroe Islands shores. EU should have imposed restriction on quantities and not a ban for all fish. In turn, there would be limited restriction of a number of ships that would pass in any specified time. Minimal fishing activities can go hand in hand with the conservation measures and environmental management. 2: Article V deals with freedom of transit where V: 2 provide that, freedom of transit is accorded through the territory of contracting party via the most convenient routes and international transit. That applies for anything in transit from and to territory of another contracting party. There should be no distinction made based on flag of vessels, place of origin, departure, exit, entry or destination. In addition, no distinction should be made to any circumstances that relate to ownership of vessels, goods or other means of transport. The EU denies freedom of transit in EU territory and Member States via convenient routes for international transit. It also makes distinction on the flag of the vessels, place of origin, entry, exist and destination related to ownership of vessels, goods and transport. Where EU refuses the ships from Faroe Islands to pass across its waters, it thus acts against the commitment s set by GATT. A WTO panel will have to acknowledge the jurisdictional status and the breath of territorial sea. There should be a difference in ruling where WTO would determine a case involving a State that is not attached to EU and that which is a member. In this case, Faroe Islands case through Denmark demonstrates a close relationship which brings the consideration of the right to free transit. Generally, sovereignty exercised by a state over its water is limited by the breath so as to allow the use of high seas based on the principle of free use by all States. The view is unanimously held as it exists in accordance to existing law and is a remarkable principle in most multinational convention. It is clear to all EU countries that sovereignty over territorial sea cannot be exercised other than with conformity with international law provisions. If at all the panel decision will consider Faroe Islands case without consideration of its relationship with EU, it would then allow Faroe Islands ships to pass across through and consistent to the breath applicable to a state. That is in accordance to present rules where ships of all States enjoy rights of innocent passage through territorial sea. Secondly, WTO panel will also consider its decision based on reasons of some geographical, special relationship or other between two or more States and rights in territorial sea granted to each other. WTO panel need to investigate the details to determine the objective ruling on freedom of transit. An objective ruling can be reached through identification of whether Faroe Islands ship passage is innocent. If at all they confirm that they do not commit an act that is prejudicial to coastal security or contrary to the present rules as well as international law and rules, Faroe Islands vessels should then be allowed to pass (Tait, 2014). They would then restrain from entering internal waters or proceeding to internal waters. There is a need for close and genuine relationships and Faroe Island can persist with its claim unless an objective ruling is reached. The EU can thus be considered to have acted in excesses of the rights recognized in the present V: 2. the panel would then limit the extensive rights enjoyed by Faroe Islands vessels with consideration of some factors such as those of objective measures to regulate fishing activities and promote trade rights. 3. Article XX deals with general exceptions which EU might rely on to defend its ban. It states that, subject to requirement that the measures set on a State are not applied and in turn be conceptualized as arbitrary or unjustifiable discrimination between countries where similar conditions prevails, nothing in the agreement would construe or prevent adoption and enforcement by a contracting party of measures relating to conservation or exhaustible resources. However, measures shall not be enforced as long as those measures are made effective according with the restrictions of domestic production and consumption. Subject to some Chapeau conditions set out Article XX GATT 1994, paragraph (g) provides for an exception from usual GATT measures of disciplines related to conservation of natural resources that are exhaustible (GATT, 1994). EU defense can follow a certain track where first, it should establish that; it is seen that Atlanto-Scandian herring constitute of what can be clearly referred to as “exhaustible natural resources”. The fact that the herring in Atlanto-Scandian are highly migratory can ensure sufficient measures between herring stock and EU invocation of Article XX (g) (Jansen, 2013). The rates with which Faroe Islands harvest with are beyond what a balanced activities on the nature should be construed. To another extent, The EU has categorically stated its objective for its measure as to ensure long-term conservation of stocks that is of common interest to EU. Atlanto-Scanian coast is shared among States and that makes it a resource of common interest to European countries. Conservation measures are supposed to be geared by all and restrict excessive activity by one of the party that might put other States to a disadvantaged state. It has identified unsustainable fishing and the situation which exist shows that the stock would not be continuously maintained above or at the levels regarded to produce maximum and sustainable yield. In addition, EU can explain in accordance to Article XX (g) that it can challenge the measures taken by Faroe Islands in line with domestic production and consumption. As noted, Faroe Island has been involved with managing Atlanto-Scandian herring for long as per requires set by UNCLOS. However, in 2013, Faroe Island and the other four coastal States failed to agree in their negotiations of Total Allowable Catch to pursue long term management plan as agreed between the States. Faroe Islands fishing activities thus increased from the limit that was set and as recommended. When the EU restrictions and limits is set a 5.16% representing approximately 31 000 tons in 2013, Faroe Islands’ exceeded to 17% which is equivalent to 105 230 tons (Ishikawa, 2014). In turn, the ban followed the measures set in paragraph (g) to restrict the sovereign rights if at all the party does not work within the domestic set limits. 4. Most of the view that WTO will come up with will still confirm the principles that are unanimously held by multilateral conventions. Clearly, sovereignty over State’s resources cannot be exercised otherwise without considering conformity with international law provisions. Some of limitations imposed on exercise of sovereignty by international law are considered I such contexts that cannot be regarded as exhaustive. In fact for that matter, GATT cannot be considered as exhaustive when determining the Faroe Islands case. Incidents that arises in a territory and which raises legal questions can also be governed by general rules set by international law. Even if they are not codified in the GATT, they can be used for the purpose of application of territorial sovereignty. Other rules of international law are expected to be mentioned alongside the provisions contained in present articles (Wolf, 2013). GATT allows creation of free trade areas as long as such creation facilitates trade and does not institute barriers to trade for other contracting parties. Faroe Islands has set unilateral fishing quota outside that which is used by EU and other coastal fishing states. The set quotas are not lesser and will be considered so long as they are consistent with the general provisions and commitments towards international law. Eventually, when those other laws are considered, WTO will promote EU to reach a compromise and allow Faroe Islands to exercise its sovereign rights even if there would be some limitations according to set percentages. Mackerel quota is subject to Edinburgh peace talks and EU sanctions appear to hurt the islands’ economy as Faroes is 90% reliant on fish export revenue (Tait, 2014). References Faroe Islands.MSC fishery assessment report. MSC Assessment,. (2013). Faroe Islands Queen Scallop Fishery. Jansen, J. C. (2013). Local knowledge and perceptions of change in spatial and abundance trends of fish species in the Westfjords of Iceland between 1992 and 2012. Wolf, M. (2013). Iceland‘s Integration Into the Common Fisheries Policy of the European Union. General Agreement on Tariffs and Trade 1994 (GATT 1994). Lester, S. (7 November 2013). The Faroe Islands Herring Dispute. International Economic Law and Policy Blog.Available: http://worldtradelaw.typepad.com/ielpblog/2013/11/the-faroe-islands-herring-dispute.html [Accessed 3 April 2014]. Ishikawa, Y.(14 February 2014). The EU-Faroe Islands Herring Stock Dispute at the WTO: the Environmental Justification. American Society of International Law.Available: http://www.asil.org/insights/volume/18/issue/4/eu-faroe-islands-herring-stock-dispute-wto-environmental-justification [Accessed 3 April 2014]. Tait, D. (3 March 2014). Thread: EU “must act” to curb Faroe and Iceland. TrawlerPhotos.co.uk. Available: http://www.trawlerphotos.co.uk/forums/showthread.php?2661-EU-quot-must-act-quot-to-curb-Faroe-and-Iceland/page39 [Accessed 3 April 2014]. Read More