News and Analysis • Volume 13 • Number 2 • June 2009

12 - Major Trade and Environment Case Looms over Seal Trade

The European Parliament overwhelmingly approved a ban on the sale of seal products on 5 May. Although the trade restriction is to apply to domestic and foreign products alike, it has raised the prospect of WTO disputes by potentially affected exporters.

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The ban, which must still be approved by EU member states, concerns all seal products except those that result from traditional hunts conducted by Inuits in Alaska, Canada, Greenland and Russia. In addition, by-products of seals culled under national laws for the ‘sole purpose of sustainable management of marine resources’ may be placed on the market on a non-profit basis, and travellers may import non-commercial quantities for their personal use.

European lawmakers’ principal motive in introducing the quasi-total sales ban was the perceived cruelty of the killing methods used rather than concern about a decline in seal populations. Proponents claim that the spikes used to crush the seals’ skulls cause unnecessary and ‘inhumane’ suffering, and that the animals are often skinned while still alive.

Several EU member countries, including Belgium, the Netherlands, Luxembourg and Italy, already have national-level bans in place. The EU prohibited the sale and import of ‘whitecoat’ products in 1983. The term refers to seal pups whose white fur has not yet moulted, a process that takes only two to three weeks from birth. Canada outlawed whitecoat hunting in 1987, but even today, more than 90 percent of the seals hunted worldwide for commercial purposes are less than a year old, and many are as young as three or four weeks.

EU member states are widely expected to approve the sales ban without major modifications before July. It could enter into force as early as October 2009.

WTO Challenges Possible

While animal welfare groups in Europe and elsewhere warmly welcomed the parliament’s decision, both Canada and Norway announced that they would challenge it at the WTO unless their seal products were excluded from final EU legislation. Both countries claim that they use humane killing methods, backed by science and consistent with international guidelines. For instance, their their regulations require seals to be killed before they are skinned; the visual impression to the contrary is created by powerful muscular spasms occurring after death.

“If the EU imposes a trade ban on seal products, it must contain an exemption for any country [...] that has strict guidelines in place for humane and sustainable sealing practices,” Canada’s Trade Minister Stockwell Day said in a statement. “If there is no such acceptable exemption, Canada will challenge the ban at the World Trade Organisation.” The proceedings will be initiated if EU member states approve the legislation as it currently stands. Nevertheless, Canada’s Prime Minister Stephen Harper said the issue should not be allowed to ‘contaminate’ the bilateral free trade negotiations launched in early May (see page 16).

Announcing Norway’s likely WTO challenge, Foreign Minister Jonas Gahr Stoere said that a broad EU ban would affect his country’s liberty to “decide how we manage our own marine resources.” He also noted that a “ban on trade in seal products [would] set a dangerous precedent in the matter of sustainable harvesting of renewable resources.”

In addition, the potential litigants maintain that sustainable management of marine resources requires culls to keep seal populations in check. They also argue that sealing provides much-needed income for isolated coastal communities when fishing activities are limited.

Possible Elements of a WTO Dispute

GATT Article XX and similar exceptions in the Agreement on Technical Barriers to Trade (TBT) allow WTO Members to take otherwise prohibited trade measures if they are necessary to protect public morals, animal life and health, or are related to the conservation of exhaustible natural resources. The seal product dispute, if it goes ahead, could hinge on whether the ban can be scientifically justified; and whether the EU could resort to less trade-restrictive means (such as labelling) to achieve its goal of preventing inhumane seal kills.

The Inuit exemption could also be challenged as a violation of the GATT national treatment principle. In that case, the panel would need to determine whether Inuit seal products are ‘like’ those subject to the ban. The determination could only be based on the way the seals are caught, raising the controversial question of differentiating between products on the basis of their ‘process or production methods’ (PPMs).

Two major precedents exist. In 1991, a GATT panel ruled that the US could not embargo tuna products from Mexico based on the way the tuna was captured, i.e. using nets banned in the US to avoid dolphin deaths. (Mexico has recently resuscitated the dispute, alleging that US criteria for ‘dolphin safe’ tuna discriminate against its exports, see Bridges Year 13 No.1 page 11, and page 8 in this issue). In contrast, a landmark WTO Appellate Body ruling in 1998 found that the US could ban shrimp imports from countries where fishing methods caused endangered sea turtles to drown so long as the trade restriction was not applied in an arbitrary manner (Bridges Year 2 No.7 page 9).

Seal Catches and Trade

Pelts account for the lion’s share of seal trade. Seal meat and oil are also traded.

Canada, the world’s largest sealing nation, allows an annual hunt on its Atlantic coast. For 2009, the quota for harp seals, the most hunted and traded species, was 280,000. Norway’s quota was 47,000 adult seals. In 2008, Canada’s total seal exports to the EU stood at US$4.7 million. Greenland and Namibia also hunt seals on a commercial scale. From 2004 to 2007, Greenland’s average annual catch was 160,000, with 63,000 pelts exported each year. Namibia’s 2008 quota was 86,000 animals. Export statistics were not available at press time.