Freya Baetens speaks on renewable energy at the WTO
Recently the WTO panel report on India – Solar Cells (DS 456) was distributed. Under India’s Jawaharlal Nehru National Solar Mission (JNNSM), solar power developers were required to use certain types of solar cells and modules manufactured in India for power generation projects in order to ultimately sell that electricity to government agencies under a long-term agreement at a guaranteed rate.
The panel found that these domestic content requirements (DCRs) form trade-related investment measures that violate the national treatment obligations under the TRIMs Agreement and the GATT 1994. The panel also decided that this discrimination cannot be exempted by the derogation for government procurement. The panel concluded that these measures were not “necessary to secure compliance with laws or regulations”, or “essential to the acquisition or distribution of products in general or local short supply” as claimed by India, and therefore cannot be justified by the general exceptions of GATT Article XX.
An interdisciplinary panel was invited to the WTO to discuss the impact of the case, consisting of Jan Bohanes (Advisory Centre on WTO Law), William Blyth (Chatham House and Imperial College London), Aaron Cosby (International Institute for Sustainable Development) and Freya Baetens. Freya was asked to assess this decision from a public international law perspective, more specifically the international rules protecting the environment and foreign investment. For this purpose, she examined the potential repercussions of this case from two angles: (1) the promotion of green energy as well as energy security through domestic content requirements (also called ‘performance requirements’), and, (2) the possibility of extrapolation of similar disputes under investor-state arbitration.