It can be difficult to analyze legal standards in the abstract. To make things more concrete, I've got a hypo that we can test under the Article III:4 test that the AB set out in Seal Products.
Imagine a regulation by Country X that categorizes cars as gas guzzlers and non-gas guzzlers, based on fuel efficiency. The regulation requires that each car company offering cars for sale in Country X must sell at least 50% non-gas guzzlers in that market.
It so happens that companies who produce in Country X make only non-gas guzzlers. By contrast, companies producing in Country Y sell only gas guzzlers.
I'm pretty sure we all would agree there is a violation of Article III:4 here (feel free to argue that there is not). But why? We all know that III:4 is about "competitive opportunities," but, in my view, that doesn't take us very far. How do we determine that "competitive opportunities" for imports have been adversely affected in this situation?
Here are some options for analyzing such a measure under Article III:4, with the AB's findings in mind:
-- Under the regulation, there is a detrimental impact on Country Y (its products are adversely affected by the regulation, whereas Country X's are not), which leads to a violation, end of story.
-- Taking into account the detrimental impact, as well as the design, structure, and expected operation of the regulation, there is a violation.
-- Taking into account the detrimental impact, and the "genuine relationship" of the regulation to that impact (possibly due to the design, structure, and expected operation of the regulation), there is a violation.
Any other possibilities?
And which view do you take?
ADDED: And when I say, "which view do you take," that can be either: (1) What is the law now (i.e., what did the AB have in mind); or (2) What should the law be.
