3.104. Thailand further mentioned that Principle 2 of the 1992 Rio Declaration provided that "States have, in accordance with the Charter of the United Nations and the principles of international law, the sovereign right to exploit their own resources pursuant to their own environmental and developmental polices, and the responsibility to ensure that activities within their jurisdiction or control do not cause damage to the environment of other States or of areas beyond the limits of national jurisdiction".²²⁸ Principle 12 of the Rio Declaration provided that "States should cooperate to promote a supportive and open international economic system that would lead to economic growth and sustainable development in all countries, to better address the problems of environmental degradation. ... Unilateral actions to deal with environmental challenges outside the jurisdiction of the importing country should be avoided. Environmental measures addressing transboundary or global environmental problems should, as far as possible, be based on an international consensus". In the preamble to the Inter-American Convention for the Protection and Conservation of Sea Turtles, the drafters recognized that the protection and conservation of sea turtles required cooperation and coordination among States within the range of such species. Thus, the Agreements cited by the United States did not authorize or anticipate the unilateral regulation or determination of conservation policies with respect to shared global resources. To the contrary, the agreements demonstrated that there was an international consensus that such measures should be avoided in favour of international cooperation and regional or multilateral agreement with respect to conservation of shared global resources.

3.105. Thailand argued that the US offer to enter into multilateral negotiations for the protection of sea turtles had taken place after the embargo had been put in place and after the first round of WTO consultations. A copy of the Inter-American Convention had been submitted to the Thai authorities as a proposed model for the negotiations; however, that agreement required the use of TEDs. In addition, Thailand had been asked to abandon the WTO proceeding. In January 1997, the Thai Department of Fisheries responded to the US letter with a series of questions about the model agreement which were never answered. It then did not appear that the offer of negotiations had been seriously put forward by the United States or that the United States was open to any negotiated outcome other than one requiring TEDs to protect sea turtles. As to CITES, which required parties to take action to protect animals in other jurisdictions, Thailand conceded that parties could multilaterally agree to a derogation to GATT rights. Moreover, CITES required that action be taken with respect to the importation, sale, handling or exportation of the endangered species itself once it came within the jurisdiction of the party. The measure at issue in this dispute, in contrast, sought to bar access to the US market for imports of a species that was not endangered - shrimp - and represented a unilateral determination of the appropriate means to conserve resources outside the jurisdiction of the United States.

3.106. As to the argument that CITES represented an international consensus concerning what each State had to do to protect endangered or threatened species and that, by reverse implication, there was no international consensus on the need for TEDs, the United States replied that CITES only addressed international trade in endangered species, not other threats to these species. CITES did not purport to limit other measures that its Parties might take to protect endangered species. In fact, CITES expressly reserved the rights of its Parties to take such other measures. Moreover, since CITES required countries, including the complainants, to restrict trade in endangered species located in the jurisdiction of other countries, CITES helped to show that there was no general principle of international law prohibiting countries from taking measures to conserve endangered species located in the jurisdiction of other countries. Regarding Principle 12 of the Rio Declaration, the United States noted that the Rio Declaration did not mandate cooperation; rather, it only stated that "unilateral actions ... should be avoided". This was language of exhortation, not obligation. The United States further noted that the United Nations Convention on Climate Change referred to by Malaysia also stated that "[m]easures taken to combat climate change, including unilateral ones, should not constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on trade". This Convention explicitly acknowledged that countries could take so-called "unilateral" actions in order to prevent harm to the environment. The United States maintained that the US government was quite serious in proposing to the complainants the negotiation of a multilateral agreement to protect sea turtles, and that it remained serious in extending this offer. The United States regarded the Inter-American Convention for the Protection and Conservation of Sea Turtles as a model of international cooperation and hoped that similar agreements could be concluded for other regions, including Asia. Regarding the assertion by Malaysia that Indonesia had banned trawling in 1980 and thus had no TEDs programme, the United States maintained that Indonesia had an operative TEDs programme since 1982. On the invitation of the Indonesian Government, the United States Government had recently conducted a TEDs training seminar in Indonesia to assist them with continued implementation of its TEDs programme for its shrimp trawl fishery, which did exist. Indonesian representative also attended a TEDs workshop held by the United States in Thailand.

6. Transfer of TEDs Technology

3.107. The United States considered that one reason why TEDs use had become so widespread was that the United States Government had undertaken extraordinary efforts to transfer TEDs technology to governments and industries in other countries, particularly in developing countries. Since 1983, when gear specialists from NMFS first began working with foreign government officials, the United States had conducted more than 50 workshops on the design, construction, installation and use of TEDs, both in the United States and in other countries. These workshops usually lasted one week, beginning with classroom lectures and videos and continuing with a hands-on programme on the construction and installation of TEDs. Many workshops also involved fishing vessel demonstrations and evaluations at sea. Through these workshops and related efforts, the United States had transferred TEDs technology to at least the following countries: Australia, Belize, Brazil, Brunei, Colombia, Costa Rica, Ecuador, El Salvador, Eritrea, Guatemala, Guyana, Honduras, India, Indonesia, Japan, Kenya, Mexico, Madagascar, Malaysia, Mozambique, Nicaragua, Panama, the People's Republic of China, the Philippines, Singapore, Suriname, Tanzania, Thailand, Trinidad and Tobago, and Venezuela. In many cases, the United States has provided multiple TEDs workshops in a given country. Recently, the United States had intensified its TEDs technology transfer efforts. In 1996 alone, the United States conducted TEDs training workshops in Mombasa, Kenya; in Songkla, Thailand; in Tegal, Indonesia; in Guayaquil, Ecuador; and in Orissa, India. The workshop in Thailand had been particularly well-attended, including participation by fisheries managers and shrimp fishermen from Australia, Brunei, Japan, Malaysia, the Philippines, Singapore and Thailand. In 1997, to date, the United States had held TEDs workshops in Mombasa, Kenya (for the second time); in several locations in Australia; in Cochin, India; and in Chittagong, Bangladesh. Thus, through the efforts of the United States Government and other governments, in cooperation with industry and environmental groups, TEDs had become a true environmental success story.

3.108. India submitted that prior to the introduction of its import restriction, the United States had not made any effort to transfer TED technology to the Government of India or, to India's knowledge, to any industries in India. Since the introduction of the embargo, the US NMFS had organized two workshops in India in collaboration with the authorities of two of India�s coastal States, and concerned Indian agencies. While TEDs were demonstrated at the workshops, India did not believe such demonstration constituted a transfer of TED technology. In fact, at the Cochin workshop, officials from the United States had demonstrated TEDs brought by NMFS experts from the United States. Although the US experts participating were shown TEDs fabricated by the Central Institute of Fisheries Nautical and Engineering Training (CIFNET), Cochin, these Indian-fabricated TEDs were not used by the participants in the workshop during demonstration sessions. Consequently, the TEDs demonstrated during this workshop were made in the United States, and were not specifically designed for the use in Indian waters. Recommendations issued after the Paradeep workshop called for further work on the possible use of TEDs in India. No recommendations were issued at the end of the Cochin workshop. During these two workshops, there was no indication given by US experts regarding the sharing of any new TED technology with India.

3.109. Malaysia responded that there had been no transfer of TED technology to its Government or to industries in Malaysia. No workshop had been conducted by the United States in Malaysia itself apart from the participation by Malaysia in a 1996 regional workshop organized by the Thai Department of Fisheries in cooperation with the Department of Foreign Trade and NMFS. Two experiments had also been carried out with TEDs, one prior to the workshop, and the other after the workshop. It was to be noted that whilst the cooperation extended by NMFS involved an NMFS official giving a talk on the use of TED, the experiments did not involve any US participation at all. Malaysia noted, furthermore, that the conservation strategies and TEDs workshops mentioned by the United States recommended and endorsed the use of TEDs through bilateral collaboration and friendly technology transfer. Much more could be achieved for sea turtles in this manner as opposed to the imposition of the import prohibition.

3.110. Pakistan responded that it was unaware of any efforts made by the United States, either before or after the imposition of the embargo, to transfer TEDs technology to Pakistan. The United States itself had recognized that there were serious costs and implementation issues associated with the manner in which the embargo had been implemented. In addition, a document submitted by the United States indicated that "in most countries there is a shortage of personnel adequately trained and supported to design and carry out research and conservation programmes, liaise with diverse sectors of society ... and enforce laws and regulations related to the conservation of sea turtles and the habitats on which they depend".²²⁹ Nor had the United States conducted any TEDs training workshops in Pakistan.

3.111. Thailand noted that the United States met twice with Thai officials for the purpose of transferring technology. In the first instance, one gentleman from the US embassy visited Thai officials in February 1996 and provided a diagram of a TED together with indications where TEDs could be purchased in the United States. In the second instance, a four-person team from the NMFS attended a four day workshop in October 1996, for Thai fishermen. This workshop was financed and organized by the Thai Department of Fisheries and Department of Foreign Trade. The US representatives made some introductory comments concerning TEDs installation and use, and showed a video which described how TEDs were used in the United States. The video also briefly described how to install a TED. The major focus of the workshop was to convey the results of TEDs experiments and experience in Thailand, Australia, Malaysia and the Southeast Asian Fisheries Development Center (SEAFDEC).

3.112. The United States replied that Malaysia had attended a TEDs training workshop in Songkla, Thailand, held on 7-10 October 1996. More than 200 hundred participants were present, including 88 Thai fishermen and officials from Malaysia, Singapore, Brunei, The Philippines, Australia and Japan. This workshop included class training, a demonstration on the installation of TEDs and actual use of TEDs in Thai shrimp trawl nets. Moreover, the government of Malaysia had invited the US NMFS to conduct a workshop in Malaysia, but had withdrawn the invitation at the last minute. Pakistan had never asked for a TEDs workshop to be conducted in Pakistan and the Government of that country had recently declined an invitation to attend a TEDs workshop in Chittagong, Bangladesh. If Pakistan or any other country needed further information on TEDs, the United States would be glad to provide it. Two TEDs training sessions had been held in India. The TEDs workshops conducted by the United States provided comprehensive training in the design, construction, installation and use of TEDs. The workshop usually lasted for 3-4 days, starting with classroom lectures and video instruction, and continuing with hands-on demonstrations in which the participants themselves installed a TED in a net. US gear technicians usually constructed at least one TED from local materials and provided training in the construction of TEDs using those materials. During the October 1996 workshop conducted in Songkla, Thailand, US officials had constructed seven TEDs from local materials. The workshops concluded with a full-day demonstration of the proper way to use a shrimp trawl net with a TED installed. The at-sea sessions repeated the instruction on the installation of a TED, and also provided direction on deploying, retrieving and handling a TED. US officials accompanied shrimp fishermen on two or three vessel trips to nearby fishing grounds for the purpose of further teaching them the practical aspects of using TEDs in the local fishing conditions. The United States left the TEDs it constructed, along with instruction manuals, free of charge, once the training was completed. The United States also invited foreign fisheries officials and fishermen to visit the NMFS harvesting systems laboratory in Pascagoula, Mississipi for further training. Representatives from many nations had responded favourably to these invitations, including a delegation from the Thai Department of Fisheries, who had come to the laboratory in mid-July 1996. On that visit, the Thai delegation had also invited a TEDs manufacturer and had observed trawl operations with TEDs in the Gulf of Mexico. The United States remained ready and willing to provide technical assistance to make TED technology available to any nation that requested it.

7. Scope and purpose of Section 609

3.113. India, Pakistan and Thailand stated that pursuant to Section 609, nations had been forced to quickly adopt TEDs requirements or lost the right to trade with the United States. The US Government had recognized during the litigation before the CIT that "[e]ven assuming the willingness of affected nations to comply with Section 609, a May 1, 1996 compliance date will achieve no conservation benefit". Specifically, a memorandum filed by the US government during the course of that litigation stated:

While the stated goal of Section 609 may have been to promote the protection and conservation of sea turtles, India, Pakistan and Thailand were of the view that, as recognized by the US Government, Section 609 as applied did not accomplish this goal.

3.114. India, Pakistan and Thailand further argued that this case was not about preventing imports of "turtle-unsafe" shrimp into the United States. Current US regulations provided that shrimp caught in trawl nets equipped with TEDs might not be imported into the United States unless the exporting nation was certified under Section 609. In order to be certified, a country had to show that all shrimp, whether consumed domestically, exported to the United States, or exported to other Members, was harvested using TEDs.²³¹ Thus, the purpose of the shrimp embargo was not simply to prevent importation into the United States of shrimp caught with technologies that might or might not pose a threat to sea turtles, it was to dictate the environmental policy that was to be followed by other Members with respect to all shrimp caught within their jurisdiction if they wished to export any shrimp to the United States.

3.115. The United States responded that, contrary to what the complainants asserted, the US Administration had never claimed that the applicability of Section 609 to shrimp harvested by nations outside the Wider Caribbean/Western Atlantic region would not promote sea turtle conservation. Section 609 initially applied only to shrimp harvested in the Wider Caribbean/Western Atlantic region. On 29 December 1995, the CIT determined that Section 609 applied on a global basis as of 1 May 1996. The US Administration asked that court to delay the effective date of its ruling by one year. In support of that request, it noted that most of the newly affected countries would be unlikely to adopted comprehensive TEDs programmes by 1 May 1996. However, the United States had never stated that the application of Section 609 to shrimp harvested in nations outside the Wider Caribbean/Western Atlantic region would not promote sea turtle conservation once these nations adopted comprehensive TEDs programmes. Despite the arguments of the US Administration, the Court had denied the request to delay the effective date of its ruling, which prompted the US Administration to redouble its efforts to provide TEDs technology to the newly affected countries, particularly in the South Asia region, so as to maximize their access to TEDs and to decrease the amount of time it would take them to adopt effective TEDs programmes. The United States further argued that the complainants appeared to seriously misapprehend the scope of Section 609; they appeared not to understand the categories of shrimp and products of shrimp to which the statute applied. The complainants accurately recognized that Section 609 did not apply to (and thus did not affect the importation of) shrimp or products of shrimp harvested by aquaculture ("aquaculture shrimp"). Aquaculture shrimp constituted the large majority of shrimp harvested in each of these nations. What the complainants appeared not to understand was that Section 609 also did not apply to (and thus did not affect the importation of) shrimp or shrimp products harvested by other means that were not harmful to sea turtles, which, for ease of discussion, could be referred to as "TED-caught shrimp", "artisanal shrimp", and "cold-water shrimp", respectively.²³²

3.116. The United States believed that some of the misunderstanding may have its origins in the issuance of two rulings on this point by the CIT in Earth Island Institute v. Christopher on 8 October and 25 November 1996. The effect of those two rulings had been to reaffirm that Section 609 did not apply to aquaculture shrimp, artisanal shrimp or cold-water shrimp. These rulings had, however, determined that Section 609 did apply to TED-caught shrimp. The US Administration believed the ruling on TED-caught shrimp to be in error and had appealed it to the US Court of Appeals for the Federal Circuit. The United States noted, however, that the outcome of this appeal would appear to have no bearing on the four complainants since Thailand had adopted a comprehensive requirement for TEDs use in 1996 - and was accordingly certified pursuant to Section 609 - while the other three complainants had not instituted any TEDs requirements at all.

C. TRADE IMPACT

3.117. India explained that, as a result of its large size and a coastline extending more than 8,085 kilometres, it had a well-developed but fragmented fishing industry. The number of mechanized vessels in India was estimated to be 47,000. Most of these vessels were rudimentary. In addition to the mechanized vessels, there were approximately 200,000 traditional boats. India submitted that the United States began enforcing the embargo on shrimp consignments in October 1996. Since that time, there had been a variety of adverse effects on India's once-thriving shrimp industry. The discriminatory effects of the embargo imposed by the United States had led to a dramatic decline in India's shrimp exports to the United States. Two major Harmonized Tariff Schedule (HTS) categories of shrimp had been affected by the embargo: HTS 0306.13.00, Shrimps and Prawns, Not Frozen and HTS 1605.20.10, Other Prepared Shrimp and Prawn Products.

3.118. India noted that the data from US imports statistics clearly demonstrated that the rapid decline in India's shrimp exports was proximately caused by the embargo. US import data indicated that the value of imports of fresh shrimp from India classified in HTS category 0306.13.00 fell from US$10.9 million to US$6.8 million, a decline of nearly 60 per cent, from October to November 1996. While shipments had begun to increase slightly in January 1997, they would not reach the levels that would be possible, absent the embargo. The decline in Indian shrimp sales classified under HTS 1605.20.10 had been even more dramatic, falling from approximately US$1.6 million in October 1996 to only US$935,500 in November 1996 and only US$750,500 in December 1996. This rapid decline in shipments had hurt the Indian shrimp industry, which was already suffering on the account of a disease that struck some of India's coastal districts during 1995 and 1996.

3.119. India argued that the US embargo had had a ripple effect on the entire Indian shrimping industry. For example, because shrimp raised in aquaculture was allowed to be shipped to the United States, a larger proportion of the total share of farm-raised shrimp was now being exported to the United States, denying local and other export markets the benefits of aquaculture shrimp. This had harmed India's commercial shrimp vessels, as the foreign demand for wild harvested shrimp had fallen. The US action had also had the effect of causing a great deal of uncertainty within the Indian shrimp industry. The socio-economic condition of the coastal community in India was closely linked with fishing and the embargo had adversely affected their livelihood. The embargo had also created great difficulties to many processing units in India. There were a number of collection centres where raw materials from various sources were collected, iced and sent to the processing units for processing. The embargo had forced these centres to maintain separate tubs and storage facilities for material from different sources, which had lead to considerable waste of time and under-utilization of facilities already created. The US actions had also had additional extraterritorial effects on India's shrimping industry. For example, because a certification form had to accompany an export of shrimp, the Government of India had had to implement a system to enable government inspectors to sign the Shrimp Exporter's Declaration. In a country the size of India, this had proved to be very difficult. Moreover, many shrimpers had been inconvenienced since it was time-consuming for exporters to prepare the necessary forms and obtain the required authorization from the competent Indian authorities.

3.120. Malaysia argued that its exports of shrimps to the US market - its fifth largest importer of that product - constituted about 5.6 per cent of its total export of shrimp in 1995. Malaysia contended that the enforcement by the US of Section 609 had significantly affected the shrimp export industry in Malaysia. In 1995 the total value of exports of shrimp to the US was US$9.1 million. In 1996, it was US$4.86 million. Exports had fallen from US$2.87 million (May-October 1995) to US$1.8 million in the corresponding months of 1996 which amounted to a drop of 38 per cent. The import prohibition had affected most of the exporters who had ceased their exports of shrimp to the United States after the import prohibition came into effect in May 1996. The company Great Ocean Seafood Sdn. Bhd. had their last consignment exported on 8 August 1996. As of September 1996 the company Rex Canning Sdn. Bhd. was the only exporter of shrimp to the United States since 60 per cent of its shrimp came from aquaculture. Several exporters had ceased exporting to the United States and were now exporting to other markets. Most of Malaysia's exports of shrimps to the United States were from the States of Sabah and Sarawak. The export from these two states constituted about 92.6 per cent of the total of Malaysia's shrimp export to the United States for 1995 and 87.8 per cent (January-October) for 1996. About 95 per cent of the shrimp exported to the United States were wild harvested.

3.121. Pakistan argued that the shrimp embargo had dramatically decreased shrimp exports to the United States and disrupted Pakistan's domestic shrimp market. There had been an adverse effect on Pakistan's shrimp industry since October 1996, when the United States began enforcing the embargo against Pakistan. Even though shrimp was harvested in Pakistan exclusively by manual means, the United States insisted that Pakistan implement a programme requiring the use of TEDs. Because Pakistan remained uncertified, it had led to a dramatic impact on shrimp sales to the United States. The embargo had decimated Pakistan's exports to the United States. Pakistan noted that, according to US import data, the value of imports of fresh shrimp from Pakistan classified in HTS category 0306.13.00 fell from US$1.8 million in October 1996 to US$707,000 in November and only US$115,000 in December. Pakistan's export statistics showed a similar trend. Obviously, this steep decline in shipments had had a negative impact on Pakistan's fishermen and shrimp industry. Moreover, the US embargo had had, and continued to have, a negative psychological effect on Pakistan's shrimp industry. It had been quite difficult attempting to disseminate the details concerning the US embargo to the small fishing villages located on Pakistan's coast. Simply put, the US action had caused a great deal of uncertainty in Pakistan's shrimp industry. The US actions had also had additional extraterritorial effects. For example, because a certification form had to accompany an export of shrimp, the Government of Pakistan had had to train government officials and to implement a system to enable government inspectors to sign the Shrimp Exporter's Declaration. Moreover, many shrimpers had been greatly inconvenienced since they had to worry about filling out US government forms proving their method of fishing.

3.122. Thailand submitted that the US shrimp embargo imposed pursuant to Section 609, effective on 1 May 1996, had resulted in a loss of trade for Thailand. Statistics prepared by the Global Trade Information Service compiled from official US import statistics, showed that between May 1996 and December 1996, the period during which Thailand was not certified, exports of shrimp from Thailand to the United States had declined by approximately 18 per cent from the same period in 1995. On 8 November 1996, the United States had certified Thailand pursuant to Section 609. The State Department had not previously certified Thailand because "the Government of Thailand had not required all commercial shrimp trawl vessels subject to its jurisdiction that operated in waters where there is a likelihood of intercepting sea turtles to use turtle excluder devices at all times". However, Thailand's present and future ability to export wild-harvested shrimp to the United States was conditioned on maintaining its status as a certified country. Certification could be revoked at any time, as illustrated by the cases of Ecuador and Colombia which had been decertified on 1 May 1997 because an on-site investigation conducted by US officials had indicated that there had been wide-spread non-compliance with each country's law requiring the use of TEDs. Certification was therefore dependent on US review of the measures which had been taken by Thailand in order to achieve certification (i.e. requiring TEDs use on its shrimping vessels and maintaining a credible programme of enforcement).

3.123. The United States argued that the measures at issue in this dispute had not disrupted the importation of shrimp into the United States. Those measures went into effect with respect to the complainants and other shrimp harvesting nations outside the Wider Caribbean/Western Atlantic region on 1 May 1996.²³³ Even though the measures were in effect throughout the last two thirds of 1996, 1996 US shrimp imports in 1996 were within 1 per cent of the average annual level from 1993-1995. Furthermore, were the US measures at issue in this dispute truly disruptive of trade, one would expect that a restriction in supply would have resulted in a corresponding increase in the price of shrimp imports into the United States. The opposite had occurred. The average unit value of US shrimp imports had declined between 1995 and 1996, falling from US$9.52 per kg to US$9.30 per kg. The United States further argued that US shrimp imports from India had increased since 1 May 1996, rising by 7.85 per cent in value terms and 6.9 per cent in volume terms. Comparing the eight month period from May-December 1996 with the same period in 1995 revealed an even more startling increase: US imports of shrimp from India had risen 27.1 per cent in value terms, and its share of total US shrimp imports had also increased by 29.4 per cent. India's exports of shrimp to the United States had also increased since 1 May 1996 relative to the average of the three preceding years. Finally, virtually none of these increases was attributable to an increase in the per unit price of India's shrimp exports, which had gone up less than 1 per cent during this period. Similarly, US imports of shrimps from Pakistan had increased by 8.3 per cent from 1995 to 1996. A comparison of the May-December periods in 1995 and 1996 showed an increase of 19.7 per cent in value terms, 5.7 per cent in volume terms. As with India, virtually none of these increases was attributable to an increase in the per unit price of Pakistani shrimp exports to the United States, which had increased only 4 cents per kg (from US$5.76 to US$5.80).

3.124. India Pakistan and Thailand maintained that their exports of shrimp and shrimp products to the United States dropped substantially after the imposition of the embargo. The fact that total imports into the United States had not decreased did not mean that the measure had not disrupted trade, it simply meant that the measure had resulted in preference for countries that had been certified and that other nations had had to alter trading patterns by sending only exempted shrimp to the United States.

3.125. India added that the reported increase in the India's exports from May to December 1996 could only have occurred because of an increase in the exportation to the United States of shrimp harvested in India by non-mechanical artisanal means or by aquaculture farming. Thus, even assuming that the Panel chose to overlook the decline in India's exports to the United States, the very fact that India had to shift its exports based on method of harvest and country of destination, and then incur administrative expenses associated with ensuring that only non-mechanical artisanally harvested shrimp and aquaculture shrimp was exported to the US market, while mechanically harvested shrimp was exported to other countries, meant that the embargo affected trade. India noted that figures provided by the United States indicated that imports from India in May-December 1996, totalling US$1.821 million, was in fact lower than imports from India during the same period in 1995, totalling US$1.856 million.²³⁴ India refuted the US assertion that imports in volume terms from India during the calendar year 1996 were higher than in the calendar year 1995. In volume terms, figures from the United States²³⁵ showed clearly that the embargo had affected general shrimp exports from India to the US market, with the worst effect on HTS 0306.13.00, which had declined from a level of 2,165,110 kgs in September 1996 to 1,544,510 kgs in October 1996, and had continued to decline steadily thereafter to register 1,134,930 kgs in November and 1,113,639 kgs in December 1996. This declining trend was significant in comparison to the upward trend in India's export of this product to the United States during the same October-December period both in 1995, when India's overall shrimp exports were adversely affected by a disease that struck India's coastal districts where shrimp was harvested, and in 1994. In 1995, exports in the month of November were 1,282,511 kgs and in December 1,686,536 kgs. In 1994, corresponding figures were for November 1,538,009 kgs and for December 2,039,976 kgs.

3.126. Malaysia stated that, although the import prohibition had not disrupted the volume of import of shrimp into the United States, exporting countries affected by the import prohibition suffered a loss of market share. The US market share which was held by exporting countries now affected by the import prohibition (uncertified countries) had been taken over by certified countries. Thus, even if the total imports had not been affected, it did not necessarily mean that exports of countries affected by the action had not been adversely affected by the import prohibition. In the case of Malaysia there had been a decline in the export of shrimp and shrimp products to the US as previously indicated.

3.127. For Pakistan, the fact that total US shrimp imports had remained relatively constant since the imposition of the embargo and that US shrimp import prices had dropped slightly, demonstrated only that US shrimp demand was fairly constant, not that the embargo had had no effect on trade. The US analysis failed to consider the impact of the embargo on exporting countries, such as a shift in markets for non-certified countries (as was the case for Pakistan), or an increase in market share for certified countries.

3.128. Thailand submitted that, according to information received by the Thai Department of Fisheries, in the spring of 1996, the imminent embargo and unknown form that the US regulations would take created such uncertainties in the marketplace that middlemen told Thai shrimp fishermen they could not continue to pay the market price and take the risk that the shrimp they purchased could not be sold in the United States. The price charged by the Thai shrimpers dropped accordingly. At least part of this decline was then passed on to customers in the United States on shrimp that could still be exported to the US market with a declaration that such shrimp had been caught by a vessel deploying a TED (this particular form of declaration was ruled unlawful by the CIT in October 1996). In short, the embargo had two adverse trade effects: it reduced the total volume and the average unit value of shrimp exported to the United States. The embargo had resulted in a substantial amount of uncertainty in the industry even before its imposition. For example, in March 1996, when exporters of Thai shrimps were aware of the possibility of the embargo, it was unclear whether the embargo would apply to both aquaculture and wild-harvested shrimp. Many exporters did not want to export shrimp due to the perceived risk of absolute loss. There was also a sharp decline in prices associated with this uncertainty: the middlemen claimed they could not pay prevailing prices due to the uncertainty regarding the ability to export to the United States. Finally, the embargo resulted in a loss to Thailand of US market share. For instance, from May-December 1995, imports of shrimp from Thailand under the 0306 HTS heading accounted for 31 per cent of total imports to the United States. However, during May-December 1996, Thai fishermen accounted for only 27 per cent of total imports to the United States, a decrease of 4 per cent.²³⁶ Thailand had therefore been forced to explore the possibility of increasing exports to other markets, which had resulted in the expenditure of both time and money.

To Continue With Chapter 3.129

²²⁸ Adoption of Agreements on Environment and Development, The Rio Declaration on Environment and Development, A/Conf.151/5/Rev. 1, 13 June 1992, reprinted in 31 I.L.M. 876.

²²⁹ IUCN (World Conservation Union), (1997), A Marine Turtle Conservation Strategy and Action Plan for the Western Indian Ocean.

²³⁰ United States Court of International Trade, Earth Island Institute v. Warren Christopher and National Fisheries Institute, Inc., Memorandum in Support of Defendants' Motion for Modification of 29 December 1995, Order, pp. 11-12.

²³¹ India, Pakistan and Thailand referred here to wild shrimp caught by mechanical means in warm waters.

²³² The United States referred here to "shrimp harvested exclusively by means that do not involve the retrieval of fishing nets by mechanical devices or by vessels using gear that, in accordance with the US programme described above, would not require TEDs" and to "species of shrimp, such as the pandalid species, harvested in areas in which sea turtles do not occur" (1996 Guidelines, 61 F.R. 17343). The United States noted that the term "artisanal shrimp" in this situation actually covered a wide variety of shrimp harvested with gear that did not harm sea turtles, including certain kinds of modern trawl gear in which sea turtles did not get caught. Similarly, the term "cold-water shrimp" in this situation covered shrimp harvested in all environments in which sea turtles did not occur; e.g. in fresh water.

²³³ The United States noted that the measures did not, however, affect importation of shrimp harvested in these nations and shipped to the United States before 1 May 1996, even if such shrimp did not actually reach the United States until after 1 May 1996.

²³⁴ Data derived from official US Department of Commerce statistics in four HTS tariff categories (03061300, 03062300, 16052005 and 16052010).

²³⁵ Bureau of Census (IM-145) # 723948.

²³⁶ Thailand indicated that these percentages were based on US import statistics which showed total value of shrimp imports under the 0306 Harmonized Tariff Schedule heading of approximately US$1,872,708,000 in 1995 and US$1,726,520,000 in 1996; imports under the same heading from Thailand were approximately US$571,717,000 in 1995 and US$469,891,000 in 1996.