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The Clean Development Mechanism And WTO Rules

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Chapter Summary

The implementation of the clean development mechanism (CDM) interacts with the economic relations between States, prompting yet another series of complex questions regarding the relationship to world trade organization (WTO) rules. Depending on WTO membership of the involved countries in a CDM project, WTO norms could govern all or parts of the economic relations. The operation of the CDM will involve substantial investment decisions and attract significant financial flows to and from Kyoto Parties that might not otherwise occur. Although WTO rules are not directly applicable to investments per se, they may nonetheless be relevant to the trade-related aspects of investment activities. This chapter focuses on General Agreement on Trade in Services (GATS). As an initial step, it seeks to scope the types of services involved in CDM projects. In the second step the chapter examines the relationship to rules of GATS.

Keywords: clean development mechanism (CDM); General Agreement on Trade in Services; world trade organization (WTO) rules



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