Decentralized Enforcement of Sustainability Commitments Rebalancing, Targeted Enforcement, and Production Requirements in Trade Agreements

This chapter examines means of enforcing sustainability commitments in trade agreements that do not require a pronouncement by an adjudicative authority but can be employed by each party directly, in what is sometimes termed ‘horizontal’ or ‘decentralized’ enforcement. Decentralized enforcement can be ‘active’, involving active decisions by a government to sanction a particular actor, or ‘passive’, integrated into the day-to-day operation of trade policy and amounting to trade restrictions or production requirements. While some instances of decentralized enforcement might be justifiable, providing for it specifically in trade agreements secures consent and avoids legal challenges and charges of unilateralism. Recent agreements and practice suggest this could become a common and powerful technique for enforcing sustainability commitments and preserving the level playing field against illegitimate cost reduction. However, if unaccompanied by available and effective adjudication, decentralized enforcement may give rise to abuse, leading to accusations of ‘green’ or ‘blue’ protectionism or coercion.