Updating this old post, there has apparently now been a threat of a WTO complaint against proposed EU biofuel restrictions. Here are the restrictions:
[The EU] intends to introduce new restrictions defining what type of land is suitable for creating biofuels. If the plans were to go ahead, fuels coming from what Brussels deems to be ecologically unsound sources would not be purchased by EU member states.
Here's the trade problem:
Argentina, Brazil, Colombia, Malawi, Mozambique, Sierra Leone, Indonesia and Malaysia have written a letter of complaint to the EU, criticising these new proposals, and threatening action unless Brussels reconsiders:
“They impose unjustifiably complex requirements on producers,” said the draft letter, which was obtained by the news agency Reuters. “Some of our countries don't exclude the possibility of defending their rights in the World Trade Organisation, as a last resort.”
The biofuel producers say that this legislation amounts to a double standard. European nations have already expanded into their wild areas so as to improve their overall quality of life, so Europeans have no right to stop other countries from doing the same, they argue:
“Provisions relating to land-use change will impinge disproportionately on developing countries, where there are stocks of undeveloped arable land which can be used for biofuels production,” the letter said.
That's some very diplomatic language. First of all, it is worth noting that only "some" of the listed countries would pursue a complaint. In addition, they "don't exclude the possibility" of a WTO complaint, and even then it's only a "last resort." This suggests to me that a complaint is not all that likely. On the other hand, if the EU goes ahead with the restrictions without making any concessions, a complaint may be the only option. It would make for some very interesting legal interpreations, that's for sure.
When I read about issues like this, the question I always ask is, who was behind this measure? Here, the two likely candidates are: (1) environmentalists who worry about destroying the environment in developing countries and (2) domestic biofuel industry folks who want to keep out foreign competitors. How much of a role did each one play? To me, this is a crucial issue. Unfortunately, I can never find out the answer to these kinds of questions.
