Thailand is among the leading tuna exporters in the world, but it is infamous for modern

slavery1. On March 7, 2022, Norway increased the import tax for Thailand tuna products

to 20%, and this new tax did not apply to other countries.

Besides, due to the impact of tuna-fishing techniques on the environment, all tuna

products will also be levied a 10% internal tax, which affects the fishing industry of

Costa Rica because the majority of its tuna products imported to Norway.

The announcement raises legal issues whether Norway complies with the Articles of

GATT 47/97 where three countries is members.

Question 1

ISSUE 1: The legal issue here is whether Norway impose the 20% import charge on the

Thailand tuna products is consistent with Article I: 1 GATT 47/97 or not.

LAW

In the question 1, the measure refers to a 20% import charge on tuna products from

Thailand, and the products or item refers to tuna products.

Article I: 1 GATT 1994 that introduces the “most-favoured-nation” (MFN) treatment

obligation regarding trade in goods aims at ensuring equality opportunities to import or

export “like products” from or to WTO Members. To identify if import charge on Thailand

tuna products by Norway is unlawful according to the MFN treatment obligation of

Article I:1 GATT 94, it is required to answer three questions. The first question is

1
Kate Nicholl, Miriam Wilhelm and Vikram Bhakoo, 'Almost Every Brand Of Tuna On Supermarket
Shelves Shows Why Modern Slavery Laws Are Needed' (The Conversation, 2019)
<https://theconversation.com/almost-every-brand-of-tuna-on-supermarket-shelves-shows-why-
modern-slavery-laws-are-needed-108421> accessed 17 April 2022.
whether the measure at issue can create a trade “advantage”. The second question is

whether the relevant products in the market are “like products” or not. The definition of

“like products” is not present in GATT 47/94, but present in the cases of Japan -

Alcoholic Beverages II2 and Canada – Periodicals3. The third question is whether the

advantage is not offered “immediately and unconditionally” to all “like products”.

APPLICATION

Regarding the first question, imposing an 20% import charge on Thailand tuna products

create an advantage for the domestic products because their price may be lower than

that of Thailand counterparts. In addition, the measure is only used for Thailand,

creating a trade “advantage” for the products from other nations. In terms of the second

question, it is mandatory to assess Norwegian tuna and Thailand tuna are considered

“like products” based on its physical characteristics, consumer habits, end use and the

international classification. However, salmon and tuna can be also regarded as “like

products” in the Norwegian market based on four criteria (Canada – Periodicals) or

based on the criteria of the natural characteristics and the competition (Japan -Alcoholic

Beverages II) tuna can cause when being introduced in the market. Regarding the third

question, the advantage is not granted “immediately and unconditionally” to all “like

products”, and Norway does not take this measure for those from other countries.

CONCLUSION

2
Japan – Taxes on Alcoholic Beverages II (1996), WT/DS8/AB/R
3
Canada - Certain Measures Concerning Periodicals(1997), WT/DS31/AB/R
In conclusion, the measure Norway used for tuna products from Thailand is inconsistent

with Article I: 1 GATT 47/97. It is recommended that Thailand can sue Norway for

breaching Article I: 1 GATT 47/94.

ISSUE 2: In case the import charge on Thailand tuna products is inconsistent with

Article I:1 GATT 47/94, whether it can be justified under Article XX GATT 47/94 or not.

LAW:

Article XX GATT 47/97 regulates general exceptions for Article I:1, II:1; III:2; III:4 and

XI:1 GATT. The import charge of Norway can be justified after two questions are

answered. The first question is whether the import charge can provisionally be justifiable

according to one of the grounds in Article XX, Article XX(b) in particular.

Modern slavery is related to Article XX (1)(b) GATT 47/94 “necessary to protect human,

animal, life or health”. However, to identify whether the measure can be justified under

Article XX (1)(b) GATT 47/94, the measure must meet two requirements: firstly, the

policy objective must be to shield life and health of humans, animals or plants; secondly,

the measure is “necessary” to achieve the policy objective. Korea – Measures Affecting

Imports of Fresh, Chilled and Frozen Beef 4 stated that the measure is necessary when

there are no other alternatives. Possible alternatives must be provided by complaining

member according to US – Measures Affecting the Cross-Border Supply of Gambling

and Betting Services5

4
Korea – Measures Affecting Imports of Fresh, Chilled and Frozen Beef (2000), WT/DS161/AB/R and
WT/DS169/AB/R, , para 161
5
US – Measures Affecting the Cross-Border Supply of Gambling and Betting Services (2005), WT/DS285/AB/R, para
309 (GATS)
The second question is whether the import charge accommodate Article XX “chapeau”

requirements. A measure can be justified under the “Chapeau” of Article XX GATT

47/94 if it is neither ‘arbitrary or unjustifiable discrimination between countries where the

same conditions prevail, nor a disguised restriction on international trade’.

The concepts of arbitrary” or “unjustifiable” discriminations are shown in two law cases:

United States - Import Prohibition of Certain Shrimp and Shrimp Products (1998) 6 (no

attempt to negotiate with the claimants to work out a solution), and Brazil – Measures

Affecting Imports of Retreaded Tyres (2007) (the reason having no connection with

objective)

APPLICATION

The purpose of the measure is to protect the life or health of some workers that become

modern slaves in Thailand. However, the measure is not considered as “necessary” to

achieve that policy objective as there may be alternatives to achieve the policy objective

according to the case of Korea – Measures Affecting Imports of Fresh, Chilled and

Frozen Beef7. For example, Norway can inform Thailand of applying some measures to

decrease the modern slavery or require Thailand suppliers to clarify supply chain.

Next, the measure fails to meet Article XX Chapeau Requirements because it is an

“arbitrary or unjustifiable discrimination”. From result of United States - Import

Prohibition of Certain Shrimp and Shrimp Product, Norway has not made any efforts to

negotiate with Thailand to discuss this issue of modern slavery in fishing industry. The

policy objective is to protect the human life but lack of negotiation between two

6
United States - Import Prohibition of Certain Shrimp and Shrimp Products (1998), WT/DS58/AB/R,
7
Korea – Measures Affecting Imports of Fresh, Chilled and Frozen Beef (2000), WT/DS161/AB/R and
WT/DS169/AB/R,
countries, Norway will be under weaker party in this case. Besides, according to the

cases of US – Measures Affecting the Cross-Border Supply of Gambling and Betting

Services, Thailand can propose the reasonable alternatives in case Thailand sue

Norway. The next point is that if this increase in the import tax for Thailand tuna

products, it should be applied for any countries that do not provide clear supply chain

CONCLUSION

In conclusion, it is not justified for Norway to charge a 20% levy on tuna products from

Thailand.

Question 2:

ISSUE 1: The legal issue is whether it is lawful for Norway to impose the 10% internal

tax on all tuna products according to Article III:2 GATT 47/94.

LAW:

Article III: 2 GATT 47/94 requires all imported products and “like domestic products” to

be treated similarly. Article III: 1 requires internal tax or internal charges not to use for

protecting domestic production. To determine if an internal tax is contrary to the national

treatment obligation of Article III: 2 GATT 47/94, an examination needs to be conducted.

The first test is to identify whether this internal tax is imposed on the products in a direct

or indirect way. The second is whether the imported tuna items and domestic salmon

items are “like products”. The final is whether tax imposed on the imported items are “in

excess of” domestic items or not. The case Argentina-Hides and Leather 8 guided the

method of tax comparison. It is necessary to compare the actual tax burden instead of

8
Argentina — Measures Affecting the Export of Bovine Hides and the Import of Finished Leather (1998), WT/DS155
nominal tax burdens. In addition, the case Japan-Alcoholic Beverages II states that the

burden of proof belongs to the complainants.

APPLICATION

The 10% internal tax can be considered as “environmental tax”, but GATT does not

determine which kind of taxes are direct or indirect. According to Environmental Taxes

Working Group, environmental tax is considered “indirect tax”. 9 Like Issue 1 of

Question 1 that is discussed above, salmon and imported tuna are “like products”.

Therefore, two kinds of fish should be treated equally in the domestic market. Finally,

when tuna and salmon products are considered “like products”, it can be that there is a

significant difference in tax. The tax of each kilo of salmon in the Norway market is NOK

0.4 while its price is about 61.8710, which means its tax is much lower than 10%, let

alone the imported tax for seafood (15%). It is possible that Norway introduces an

advantage to protect their domestic products. However, Costa Rica must collect enough

evidence to show that tuna is competing with salmon in the market of Norway and

Norway is guarding domestic salmon products.

CONCLUSION

9
Angela Fearnside, 'What Is An Environmental Tax?' (Taxadvisermagazine.com, 2016)

<https://www.taxadvisermagazine.com/article/what-environmental-tax> accessed 18 April 2022.

10
Jason Holland, 'Norway Proposes Production Tax On Farmed Salmon, Trout' (Seafoodsource.com, 2020)

<https://www.seafoodsource.com/news/supply-trade/norway-proposes-production-tax-on-farmed-salmon-trout>

accessed 18 April 2022.

Therefore, the 10% internal tax on all tuna products is inconsistent with Article III: 2

GATT 47/94. Some tuna providers from Costa Rica can sue Norway for breaching

Article III: 2 GATT 47/94.

ISSUE 2: The measure Norway has taken on all tuna products is not consistent with

Article III: 2, but whether it can be justified under Article XX GATT 47/94.

LAW

Article XX introduces vital exceptions from the treatment obligations of GATT, and this

article can be applied to Articles III: 2. In the case US – Standards for Reformulated and

Conventional Gasoline establish a two-question test to identify whether the unlawful

measure is justifiable under Article XX GATT 47/94. Firstly, it is necessary to identify

whether the measure belongs to the list of grounds in Article XX (a) to (j), particularly

Article XX (g). To identify whether a measure can be justified under Article XX (g), there

are three requirements that need to be considered. The first requirement is that the

purpose of the measure must be to conserve limited natural resources; the second is

that it must “relate to” the policy purpose; and finally, it must be applied to domestic

production. Secondly, it is required to determine whether applying the measure is

suitable with Article “chapeau” requirements. Similar to issue 2 of question 1, there are

two requirements: “no discrimination” and “necessary” that need consideration. United

States - Import Prohibition of Certain Shrimp and Shrimp Products (1998), a ban on

imported shrimp and shrimp products from the countries had not use suitable nets to

catch shrimps is not justified under Article XX because of “arbitrary and unjustifiable”

discrimination. Also in this case, the concept of “relating to” is defined: the measure is
considered as “relating to” the policy objective if it is “primarily aimed” at conserving the

natural resources.

APPLICATION

The measure can be claimed under Article XX (g) because it accommodates three

requirements. Firstly, its policy objective is to protect natural resources because fishing

techniques employed in many countries adversely affects the environment. Secondly,

from the definition of “relating to” in the US shrimp case, it can be seen that a 10%

internal tax seems not to primarily aim to protect the natural resources. To protect the

marine environment, the government needs take various actions such as bringing in the

stricter laws on catching fish and marine animals or raising awareness of conserving the

marine life. An increase in tuna tax rather than other type of seafood is not related to the

policy objective. For the other condition, the measure also needs to be applied to

domestic products. In case salmon and tuna are assessed “like products”, the measure

does not apply to salmon products. Therefore, the first requirement is not met. The

chapeau requirements, besides maintaining the balance, it helps WTO members

establish the measure that is suitable with the chapeau. Cooperation among affected

countries should be undertaken, and situations of different countries should be taken

account. In this case, Costa Rica imports 75% of its tuna to Norway, so it will be

affected the most.

CONCLUSION

Therefore, the 10% internal tax on tuna products is not justifiable under the Article XX.

Related parties should have further negotiation before taking this case to the court.
REFERENCES

1. Cases

- Argentina — Measures Affecting the Export of Bovine Hides and the Import of

Finished Leather (1998), WT/DS155

- Brazil – Measures Affecting Imports of Retreaded Tyres (2007),

WT/DS332/AB/R.

- Canada - Certain Measures Concerning Periodicals(1997), WT/DS31/AB/R

- Korea – Measures Affecting Imports of Fresh, Chilled and Frozen Beef

(2000), WT/DS161/AB/R and WT/DS169/AB/R.

- Japan – Taxes on Alcoholic Beverages II (1996), WT/DS8/AB/R

- United States - Import Prohibition of Certain Shrimp and Shrimp Products

(1998), WT/DS58/AB/R.

- United States – Standards for Reformulated and Conventional Gasoline

(1996), WT/DS2/AB/R.

- United States – Measures Affecting the Cross-Border Supply of Gambling

and Betting Services (2005), WT/DS285/AB/R.

2. Websites

- Fearnside A, 'What Is An Environmental Tax?' (Taxadvisermagazine.com,

2016) <https://www.taxadvisermagazine.com/article/what-environmental-tax>

accessed 18 April 2022

- Holland J, 'Norway Proposes Production Tax On Farmed Salmon, Trout'

(Seafoodsource.com, 2020) <https://www.seafoodsource.com/news/supply-

 trade/norway-proposes-production-tax-on-farmed-salmon-trout#:~:text=The

%20introduction%20of%20a%20production,per%20kilogram%20of%20fish

%20produced.> accessed 15 April 2022

- Nicholl K, Wilhelm M, and Bhakoo V, 'Almost Every Brand Of Tuna On

Supermarket Shelves Shows Why Modern Slavery Laws Are Needed' (The

Conversation, 2019) <https://theconversation.com/almost-every-brand-of-

tuna-on-supermarket-shelves-shows-why-modern-slavery-laws-are-needed-

108421> accessed 17 April 2022

3. Legislation

The General Agreement on Tariffs and Trade 1947

The General Agreement on Tariffs and Trade 1994