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The Nature of Law Newsletter, July 2006



Volume 1, Issue 2, July 2006

Message from the Chief Counsel

This second edition of the LEGEN Newsletter leads with a report on the recent ruling by the International Court of Justice concerning the Uruguay River dispute between Argentina and Uruguay. At issue is Uruguay's unilateral authorization of pulp and paper mills within 25 kilometers of the Argentine coast. There remains a steady, if not increasing, use of international tribunals to address environment and natural resource related disputes. As a directly relevant example of this increase, this year alone the World Bank Inspection Panel has received four requests for investigation (Brazil - Parana Biodiversity, Nigeria - West Africa Gas Pipeline, Romania - Mine Closure and Social Mitigation, and Honduras - Land Administration). As our newsletter points out, the nature of these disputes is dynamic, as is the related role of civil society. As another example reported below, it was agreed for the first time that a World Trade Organization dispute panel hearing concerning the EU-US dispute on beef hormones could be held in public.

In addition to the calendar of upcoming events through end of September, we report on the launch of the European Principles for the Environment; the Strategic Partnership to help support marine fisheries in Sub-Saharan Africa; and the recent World Water Forum.

As always, we welcome your feedback on how this newsletter can best be of service.

Charles E. Di Leva
Chief Counsel, Environment and International Law Unit
Legal Vice Presidency - The World Bank


River Uruguay Dispute before the ICJ
By Salman M.A. Salman and Maurizio Ragazzi

Launch of the European Principles for the Environment (EPE)
By Sachiko Morita

The Strategic Partnership for a Sustainable Fisheries Investment Fund in the Large Marine Ecosystems (LMEs) in Sub-Saharan Africa (SSA)
By Patrice Talla Takoukam

The Fourth World Water Forum
By Salman M. A. Salman

EC-Hormones: WTO Allows Public to Attend Dispute Settlement Hearing
By Charles Di Leva and Sachiko Morita

River Uruguay Dispute before the ICJ
By Salman M.A. Salman and Maurizio Ragazzi

On May 4, 2006, Argentina brought a case against Uruguay before the International Court of Justice (the ICJ), which is the principal judicial organ of the United Nations. Argentina alleged that Uruguay is in breach of the Statute of the River Uruguay, a treaty entered into between the parties in 1975 with a view to regulating the conservation, utilization, exploitation of natural resources, and prevention of pollution of the River Uruguay. The River Uruguay constitutes the boundary between the two countries. As a basis for the ICJ’s jurisdiction, Argentina cited Article 60 of the 1975 Statute, the first paragraph of which allows submission to the ICJ if direct negotiations between the parties have not settled the dispute. (A High Level Technical Group – GTAN in its Spanish acronym – had not led to any agreement between the parties.)

In its application, Argentina alleged that, in October 2003, Uruguay had unilaterally authorized the construction of a pulp mill near Fray Bentos (within 25 kilometers of the Argentine tourist resort of Gualeguaychu), without giving prior notification and without complying with the consultation procedures under the 1975 Statute. Uruguay would allegedly have also aggravated the dispute by allowing the construction of a second pulp mill and a port in the same area. The International Finance Corporation (IFC) is considering providing a loan, and the Multilateral Investment Guarantee Corporation (MIGA) is considering providing a guarantee, to the two projects. Argentina also alleged that these mills would damage the environment of the River Uruguay, affecting more than 300,000 Argentine inhabitants concerned by the significant risk of river pollution, biodiversity deterioration, harm to human health and fisheries resources, and extremely serious consequences for economic interests.

On the basis of these allegations, Argentina requested the ICJ to adjudge and declare that Uruguay (a) is in breach of its international obligations regarding the environmental protection and rational use of the River Uruguay, (b) is therefore internationally responsible towards Argentina, (c) must cease its wrongful conduct and comply in the future with its obligations, and (d) must make full reparation for the injury caused by its breach.

In essence, the dispute between the parties is whether or not Uruguay is in compliance with its international obligations on effluent emissions from pulp mills, Argentina questioning the environmental impact assessment studies relied on by Uruguay.

In submitting its application, Argentina also requested from the ICJ the indication of provisional measures, whereby Uruguay would (a) suspend all authorizations for the construction of the mills, (b) take all necessary measures to stop building work on the mills, (c) cooperate with Argentina to ensure optimal and rational utilization of the river, (d) refrain from unilateral actions regarding the construction of the mills in breach of the 1975 Statute, and (e) refrain from aggravating actions that would render the settlement of the dispute more difficult. In asking the ICJ to reject the Argentine request, Uruguay contended that the conditions required for interim relief had not been satisfied in this case.

Interim relief has been requested in more than thirty past cases, none of which, though, involved a request regarding the construction of mills. Public hearings on the Argentine request for provisional measures took place on June 8 and 9, 2006. Given the interest generated by this case, the ICJ established an online admission procedure to the hearings for the public, including members of the diplomatic corps. At the time of writing, no decision on the request for provisional measures has yet been made by the ICJ. On the basis of past practice, a decision is likely to be handed down within several weeks from the public hearings. An ICJ order on provisional measures does not preclude a subsequent finding that the ICJ lacks jurisdiction or the application is inadmissible.

Useful link

  • The documentation regarding the case is electronically available at the ICJ web site.

Launch of the European Principles for the Environment (EPE)
By Sachiko Morita

On the opening day of the European Commission’s Green Week 2006 in Brussels last May 30, five European multilateral development banks signed a declaration of “European Principles for the Environment.” The banks are the Black Sea Trade and Development Bank, Council of Europe Development Bank, the European Bank for Reconstruction and Development, the European Investment Bank, the Nordic Environment Finance Corporation and the Nordic Investment Bank. The principles would be applied to projects they will fund.

The EPE “consist of the guiding environmental principles enshrined in the EC Treaty and the project-specific practices and standards incorporated in EU secondary legislation on the environment.” Specifically, these are: “the precautionary principle, the prevention principle, the principle that environmental damage should as a priority be rectified at source, and the polluter pays principle.”

Useful link

The Strategic Partnership for a Sustainable Fisheries Investment Fund in the Large Marine Ecosystems (LMEs) in Sub-Saharan Africa (SSA)
By Patrice Talla Takoukam

Launched in August 2005, the Strategic Partnership is a new initiative to leverage additional financing from GEF and other partners to help support sustainable marine fisheries in Sub-Saharan Africa (SSA). The partners include the African Union, FAO, WWF, Regional Fisheries Management Bodies, and the World Bank as the implementing agency on behalf of GEF. On May 16-18, 2006, the African Union chaired the First Session of the Regional Advisory Committee (RAC) in Nairobi, Kenya. The committee adopted a series of recommendations on: (1) the functioning of RAC; (2) submission, implementation, monitoring and evaluation of projects; and (3) types of projects that will be supported by the partnership.

These recommendations support the Strategic Partnership’s primary objective of helping reverse the depletion of fisheries in the Large Marine Ecosystems (LMEs) of SSA and assisting coastal countries to meet the fisheries and poverty reduction targets set by WSSD. Means to this end include:

  • Accelerating country-level investments to assist coastal countries in undertaking governance reforms and sector adjustments.
  • Assisting coastal countries to participate in GEF-sponsored LME programs and other regional and sub-regional initiatives, and collaborating to implement management measures through these projects.
  • Promoting learning, information exchange and capacity building at the regional level.
  • Encouraging direct financial support to the fisheries sector.

The success of the Strategic Partnership will be closely monitored by two indicators: (1) sustainable use of fisheries resources in LMEs of at least 10 SSA countries by 2015; and (2) poverty alleviation and vulnerability reduction in coastal and fishing communities in at least 10 SSA countries.

The Fourth World Water Forum
By Salman M. A. Salman

The Fourth World Water Forum was held in Mexico City on March 15-March 22, 2006.

The World Water Forum is organized by the World Water Council every three years. The first Forum was held in Marrakech, Morocco, in 1997; the second at The Hague, The Netherlands, in 2000; the third at Kyoto, Japan in 2003; and the Fourth in Mexico City, Mexico. The forum usually starts on March 15 and ends on March 22, which is World Water Day.

The Fourth World Water Forum was attended by more than 10,000 participants representing governments, UN agencies and international financial institutions, NGOs, academics, research institutions and private sector organizations. The main focus of the Forum was “Local Actions for Global Challenge,” with five themes: Water for Growth and Development; Implementing Integrated Water Resources Management; Water Supply and Sanitation for all; Water Management for Food and the Environment; and Risk Management. More than 250 parallel sessions were held under those themes.

A number of sessions dealt with water law, including water sector reforms, water and free trade agreements, shared groundwater resources for sustainable development, transboundary waters in the Americas, and water management legal modernization.

The Ministerial Meeting was held in the last two days of the Forum. Two issues dominated the Forum: the human right to water and the role of the private sector in water services delivery. However, the Ministerial Declaration failed to address either issue in clear terms.

Useful links

EC-Hormones: WTO Allows Public to Attend Dispute Settlement Hearing
By Charles Di Leva and Sachiko Morita

The World Trade Organization recently agreed for the first time to open a dispute settlement hearing to the public. For a number of years, some have issued criticism of the WTO for its alleged lack of openness, including in how it conducts disputes.

Brief Background of the Dispute

The EU requested consultations with the US and Canada for their continued trade sanctions on certain EU exports, worth US $ 116.8 million and US $ 11.6 million, respectively. The challenged sanctions were authorized in 1999 by the WTO’s Dispute Settlement Body (DSB) after the Appellate Body found in 1998 that an EU ban on hormone treated meat exports from the US and Canadaviolated the WTO Agreement on Sanitary and Phyto-sanitary Measures (SPS).

In 2003, the EU removed the measures found to be inconsistent and adopted new legislation which assessed the potential risks to human health from hormone residues in meat and meat products (One of the reasons cited by the Appellate Body in its ruling against the EU was its failure to carry out a risk assessment within the meaning of Articles 5.1 and 5.2 of the SPS Agreement).The EU argued that these measures complied with the 1998 Appellate Body ruling, and that therefore the continued sanctions by the US and Canadaviolated the WTO rules. The US and Canada, however, disagreed and have continued to impose retaliatory duties on certain products from the EU.

The First Public Dispute Settlement Hearing

To address the impasse between the parties, the first substantive meeting of the Panels with the Parties took place on September 12-15, 2005. With the request of the Parties, the Panels opened up the proceedings of the dispute settlement meeting to the public for the first time. The proceedings were broadcasted through closed-circuit television to an audience consisting mainly of trade negotiators, non-governmental organization representatives, media and academics. The meeting of the Panels with the third parties remained closed as not all the third parties agreed to have it open for observation by the public.

Registration for the Hearings in September/October has begun

At the request of the Parties, the Panels will again open their proceedings with the Parties and scientific experts on September 27-28, 2006 and with the Parties on October 2-3, 2006. These proceedings will be broadcasted to the WTO Members and the general public via closed-circuit television. Those interested in attending the hearing should send the completed form to no later than September 4, 2006.










16th Meeting of the CITES Plants Committee

Lima, Peru


25th Open-ended Working Group of the Parties to the Montreal Protocol

Montreal, Canada


22nd Meeting of the CITES Animals Committee

Lima, Peru


Conference on EU Emissions Trading 2006: Competitive and Financial Implications

Brussels, Belgium
25-27Waste Summit 2006Johannesburg, South Africa
20-262006 World Water Week in StockholmStockholm, Sweden
29-303rd GEF AssemblyCape Town, South Africa
10-14International Water Association World Water CongressBeijing, China
11-14African Regional Meeting on SAICM (Strategic Approach to International Chemicals Management)Cairo, Egypt
18-22Global Conference on Renewable Energy Approaches for Desert RegionsAmman, Jordan
19-202006 Annual Meetings of the International Monetary Fund and the World Bank GroupSingapore
19-21Meeting On Biodiversity in European Development CooperationParis, France
20-22IPEN (The International POPs Elimination Network) General AssemblyBudapest, Hungary












The Environment and International Law Unit of the World Bank’s Legal Vice Presidency (LEGEN) provides advice to the Bank on all environmental and international legal and policy issues related to Bank-financed, implemented and/or supported projects.

For futher information, please email us:

Last updated: 2011-09-05

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