22 Oct Horsemeat Export Bans, the WTO, and the Foreign Commerce Clause
Last month the Seventh Circuit, per Judge Posner, rendered an especially ill-informed and badly written decision upholding a Illinois statute that banned the export or import of horsemeat for human consumption. In the case of Cavel International v. Madigan, the Seventh Circuit ruled that there was only incidental discrimination to foreign commerce and there was a rational basis to uphold the statute. Here is an excerpt:
On May 24 of this year, the Illinois Horse Meat Act, 225 ILCS 635, was amended to make it unlawful for any person in the state either “to slaughter a horse if that person knows or should know that any of the horse meat will be used for human consumption,” … or “to import into or export from this State, or to sell, buy, give away, hold, or accept any horse meat if that person knows or should know that the horse meat will be used for human consumption.”…
The more difficult question is whether the horse-meat amendment violates the commerce clause as interpreted to prohibit state regulations that unduly interfere with the foreign commerce of the United States. Cavel fastens on subsection (b) of the Illinois amendment, which forbids the importing and exporting of horse meat for human consumption….
The careful reader will have noted that we have so far been discussing the legal principles governing state burdens on interstate commerce, though the Illinois statute burdens foreign commerce. Quite apart from economic consequences, an interference by a state with foreign commerce can complicate the nation’s foreign relations, which are a monopoly of the federal government; states are not permitted to have their own foreign policy, their own embassies and consuls and ambassadors, and so forth. “Foreign commerce is pre-eminently a matter of national concern. ‘In international relations and with respect to foreign intercourse and trade the people of the United States act through a single government with unified and adequate national power.’…
The curtailment of foreign commerce by the amendment is slight and we are naturally reluctant to condemn a state law, supported if somewhat tenuously by a legitimate state interest, on grounds as slight as presented by Cavel. Yet we are not entirely happy about having to uphold the Illinois statute. That the company is foreign-owned and its entire output exported means that the shareholders and consumers harmed by the amendment have no influence in Illinois politics, though there is no hint in the history of the amendment of local hostility to foreigners but only of indifference to them…. [There is not] a basis for invalidating a nondiscriminatory statute that interferes minimally with the nation’s foreign commerce and cannot be said to have no rational basis.
The case includes bizarre references to Bo Derek’s vocal opposition to the consumption of horsemeat, strangely inserts a photo of a caged tiger eating horsemeat as an example of a domestic market for the product, and makes gratuitous and meaningless references to John Stuart Mill.
But what struck me as particularly odd about the case is that it completely ignores our WTO obligations that prohibit export and import bans. Article XI of GATT 1947 provides:
No prohibitions or restrictions other than duties, taxes or other charges … shall be instituted or maintained by any contracting party on the importation of any product … or on the exportation or sale for export of any product destined for the territory of any other contracting party.
Thus, if a producer wants to export horsemeat to Europe for human consumption, subject to exceptions discussed below, the WTO protects that producer’s right to do so. This provision, of course, applies with equal force to state and local laws and regulations.
Now, Illinois may wish to invoke a WTO exception under Article XX(b) of GATT 1947 for measures “necessary to protect … animal … life or health (or perhaps Article XX(a) provision that the law is “necessary to protect public morals.”) If Article XI prohibits a state export ban, then Article XX may be invoked to save it. But those Article XX exceptions are quite narrow and it is unclear that Illinois could prevail on this ground.
In some respects this case is reminiscent of the old Tuna/Dolphin wars, with the wrinkle that it is a state law that is involved and it is the more binding WTO rules rather than the old consensual GATT system that are limiting these import and export bans.
I suppose the core of the question is whether federal and state courts should construe WTO obligations as part of the analysis when they are considering either the question of federal preemption or the scope of the foreign commerce clause. Does the existence of WTO rules as implemented in the United States impact our understanding of those doctrines? I think it should.
It strikes me as a logical conclusion that federal courts should look with disfavor on state and local laws that openly violate our WTO obligations. Otherwise a state could impose import bans, impose special taxes on foreign products, impose laws that favor one country over another, or otherwise discriminate against foreign commerce. When the federal government passes a statute that arguably violates WTO obligations, at the domestic level the only possible impact WTO rules might have is on the interpretation of that statute (using Charming Betsy), at least pending litigation before the WTO. But when a state or local government passes a law that violates WTO obligations, it would seem that the direct impact of WTO rules is greater, either by virtue of WTO rules informing the analysis of preemption, the foreign commerce clause, or the federal foreign affairs power.
I should add that this is an area where European and American morals and attitudes about animal welfare differ markedly. No surprise, I am biased toward the American perspective on horsemeat consumption, but do think that each country should have some freedom to identify their own particular concerns about animal welfare and public morals.
This is an interesting post, and I look forward to reading the case. However, it is unlikely that the U.S. ban on horsemeat would be understood to violate the ban on import restrictions under Article XI of GATT. This is because under the ad note to Article III, it is commonly understood that domestic regulation of products is exclusively “subject to” Article III (the national treatment provision), and is not therefore subject to Article XI. The export restriction would pose a more difficult, and interesting, case. The ad note, by its terms, seems to apply only to import restrictions, not export restrictions.
The premise of Roger’s argument appears to be that the Foreign Commerce Clause incorporates our international obligations, even those for which Congress provided only limited judicial remedies (suits for injunctive relief brought only by the United States). Should the Foreign Commerce Clause be used to effect an end run around Section 102 of the Uruguay Round Agreements Act of 1994? I think not.
Paul Stephan raises a very important point. I think Paul’s instinct is right that preemption based on WTO obligations, standing alone, would not be the basis for a challenge by Cavel. But is that the end of it? Section 102(b)(2)(A) of the URAA, available here, provides that “no State law, or the application of such a State law, may be declared invalid as to any person or circumstances on the ground that the provision or application is inconsistent with any of the Uruguay Round Agreements, except in an action brought by the United States for the purpose of declaring such law or application invalid.” Compare that with Section 102(a) (the provision dealing with inconsistent federal law): “No provision of any of the Uruguay Round Agreements, nor the application of any such provision to any person or circumstance, that is inconsistent with any law of the United States shall have effect.” The key is what the phrase “declared invalid” means in Section 102(b)(2). There are several possibilities. First, it may just mean that there is no private right of action, i.e., the United States can invoke it but private parties cannot. But if the United States relied on Article XI, what… Read more »
I exchanged emails with counsel for Cavel today and he confirmed that the WTO arguments were raised before the district court and the appellate court. He said in his opinion they just weren’t interested in those arguments, and focused instead on the foreign commerce clause.
Roger Alford