International Governance of Energy Trade: WTO and the Energy Charter Treaty

On 21 September 2011 the Energy Charter Secretariat organised a session entitled 'International Governance of Energy Trade: WTO and the Energy Charter Treaty' at the WTO Public Forum.

In his address to the audience, the Energy Charter Secretary General Amb. Mernier underlined the unique role the Energy Charter Treaty plays as the only energy-specific multilateral agreement that covers all major aspects of international energy turnover: trade, transit, investment and energy efficiency. The ECT incorporates WTO rules with respect to energy trade and extends them to non-WTO countries that are members of the ECT.

Professor Gabrielle Marceau, Counsellor in the Legal Affairs Division of the WTO, elaborated on the application of the general WTO rules to trade in energy. The main goal of the WTO is to prohibit protectionism. In the energy trade, export restrictions represent a more important concern than import barriers.

The discussion centred on the question of the most effective approach for dealing with energy trade regulation at a multilateral level - through special rules or general rules? Opinions were divided on this issue. Professor Thomas Cottier presented a proposal on creating a framework agreement on energy within the WTO that could refer to pertinent provisions of other agreements outside the scope of the WTO, such as those of the Energy Charter Treaty.

There was a consensus that the principle challenges linked to energy trade are related to different interests between consuming and producing states. Professor Peter Cameron of Dundee University highlighted the importance of the soft non-legal role of international organisations in setting common ground for dialogue. In his view, international organisations should contribute more to the debate on such issues as energy transit. Cooperation between WTO and the ECT is sensible and desirable, in his view, as the ECT provides a noticeable value added to the existing general WTO framework that covers a much larger constituency.

The speakers and members of the audience underlined that the key issue to remember is the need for a balance between the interests of different stakeholders. A necessary condition for reaching such a consensus, and an area where the Charter Process contributes, is the dialogue between different groups of players: consuming, producing and transit countries, at all stages of economic development. From this point of view, noted Amb. Mernier, the ECT has a distinctive role - no other energy-related organisation provides a common platform for the development and implementation of binding disciplines among these different groups of stakeholders.