The Free Trade Agreement of North America (TLCAN), which came into force in 1994, has been replaced by the New T-MEC; USMCA; CUSMA (the Agreement), executed by and between Mexico, the United States and Canada. The Agreement is in force for the parties as of 1 July 2020, with a duration of 16 years. It is subject to review at determined deadlines. This Agreement promotes the commercial integration of North America. It contains 34 chapters. Chapter 24 makes reference to the environment. In that Chapter, the parties recognise the current environmental problems and the importance of conserving, protecting and improving the environment, as well as the use and sustainable management of natural resources within their territories. In Chapter 24, the parties seek to reinforce environmental protection policies in the context of free trade. Below, we set out a brief summary of the more important provisions of the Chapter. It is important to note that Chapter 24 contains no explicit provisions related to climate change or renewable energy.
Article 24.1 sets out various definitions. “Environmental Law” is defined as a statute or regulation of a state party, or provision thereof, including any that implement the party’s obligations under a multilateral environmental agreement, the primary purpose of which is the protection of the environment, or the prevention of a danger to human life or health, through:
However, the article expressly excludes from the definition a statute or regulation, or provision thereof, directly related to worker safety or health, or a statute or regulation, or provision thereof, the primary purpose of which is managing the subsistence or aboriginal harvesting of natural sources.
Article 24.2 sets out the scope and objectives of the Chapter. It states that the parties recognise that a healthy environment is an integral element of sustainable development and that trade makes a contribution to sustainable development. The parties commit to promote mutually supportive trade and environmental protection, and the effective enforcement of environmental laws. They also agree to enhance the capacities of the parties to address trade-related environmental issues, including through cooperation, to further sustainable development. The parties state in article 24.2 that enhanced cooperation to protect and conserve the environment, and the sustainable use and management of natural resources brings benefits that can contribute to sustainable development. They also recognise that such enhanced cooperation strengthens environmental governance, supports the implementation of the international environmental agreement to which they are party and complements the objectives of the Agreement. The parties also recognise that the environment plays an important role in the economic, social, and cultural well-being of indigenous peoples and local communities. However, crucially, article 24.2 provides that: “it is inappropriate to establish or use their environmental laws or other measures in a manner which would constitute a disguised restriction on trade or investment between Parties.”
Article 24.3 reserves the sovereign right of each party to establish its own levels of domestic environmental protection and its own environmental priorities, and to establish, adopt, or modify its environmental laws and policies accordingly. Each party commits to strive to ensure that its environmental laws and policies provide for, and encourage, high levels of environmental protection.
However, balanced against that sovereign right, article 24.4 provides that no party shall fail to effectively enforce its environmental laws ‘in a manner affecting trade or investment between the Parties’ and should not waive or derogate from its environmental laws to encourage trade or investment between the parties.
Article 24.2 provides that each party shall promote public awareness of its environmental laws and policies, including enforcement end compliance procedures, by ensuring that relevant information is available to the public. In addition, each party shall make use of existing, or establish new, consultative mechanisms, for example, national advisory committees to seek views on matters related to the implementation of the Chapter.
Procedural matters are governed by article 24.3, which obliges each state party to ensure that any interested party can request the competent authorities in that state to investigate alleged violations of environmental laws; that parties with a ‘recognised interest’ under the law have access to administrative, quasi-judicial or judicial proceedings for the enforcement of the party’s environmental laws; and the right to seek appropriate remedies or sanctions for violations of those laws. Provisions are also made requiring that final decisions in those proceedings are made in writing and made available without undue delay to the parties, with individual parties having the right to seek ‘review’ of the final decisions.
Article 24.7 obliges state parties to have procedures for environmental impact assessments of proposed projects that are subject to the approval of the state party’s central government, and to ensure that information is disclosed to the public and the public can participate in that assessment.
Article 24.8 lists a number of multilateral environment agreements, which the parties agree to fulfil by adopting, maintaining and implementing all necessary laws. Absent from the list is the United Nations Framework Convention on Climate Change or the Paris Agreement. The following multilateral environment agreements are covered by this article:
Article 24.9 to 24.23 focus on specific environmental protections and cover the following:
The rest of the Chapter sets out a framework for the parties to cooperate to implement the Chapter; discuss any disagreements and deal with any enforcement matters; and if all else fails invoke the dispute resolution procedures of the Agreement. Parties are obliged to designate an environmental committee and contact points from its relevant authorities to facilitate communication, and the parties should establish an environmental committee composed of senior government representatives, or their designees, of the relevant trade and environment central level or government authorities of each party responsible for the implementation of the Chapter. The purpose of the committee is to oversee the implementation of the chapter, it will then be reviewed five years after 1 July 2020.
“Any person” of a state party may file a submission asserting that a state party is failing to effectively enforce its environment laws with the Secretariat of the Commission for Environmental Cooperation. Articles 24.27 and 24.28 set out a detailed procedure for considering those submissions (or indeed deciding that the submissions should not be considered by the Secretariat). Articles 24.29 to 24.32 concern disputes between state parties. First, there is a consultation process within the Chapter, where state parties seek to reach agreement on the interpretation and application of the chapter, using the respective parties’ contact points. If that fails, the senior representatives of each party on the environment committee consider the matter and if that fails to resolve the matter, the issue is referred to the relevant ministries of the state parties. If the ministerial consultations fail, the parties can invoke the dispute resolution procedures set out in Chapter 31 of the Agreement.
In this Agreement, the state parties seek ways to modernise and improve the effectiveness of environmental cooperation, using that cooperation as a means to promote mutually supportive trade and environmental policies, including support for the implementation of the environmental goals and objectives established in the Agreement, thus strengthening cooperation between the parties to conserve, protect and improve the environment. The state parties seek to promote public participation in the development of environmental laws, regulations, procedures, policies and practices, and their application, while allowing trade between the parties.