Severity of consequences

Joyner (1998, p280) observes that an initial step in achieving compliance with international regulations is to establish a management regime that is acceptable to all parties. In other words, internal enforcement systems are generally products of international bargaining. As a result, they are likely to be subject to the so-called 'law of the least ambitious programme' (Underdal, 1980; 1998). This law, which is arguably of particular relevance for constitutional bargaining (e.g., bargaining about the formation and design of an international regime), says that in international bargaining the final word typically rests with the least enthusiastic party. It follows that we are well advised to expect the parties to international agreements to settle for relatively unambitious enforcement schemes. Anecdotal evidence seems to support this hypothesis. Relatively few international regimes and organizations have hard enforcement instruments of their own. Instead, internal enforcement is often limited to soft measures such as reporting, persuasion and shaming (Chayes and Chayes, 1995; Yoshida, 1999). To the extent that internal schemes for enforcement prove insufficient, external enforcement may be able to offer potentially more severe options. Alternatively, external reactions may be seen as a useful supplement to internal mechanisms for enforcement, thereby adding to the aggregate deterrent effect.

Effective deterrence requires that the expected response to non-compliance is more than proportional (Heister et al, 1997; Hovi and Areklett, 2004). Since future payoffs are likely to be discounted, the deterrent effect of a given punishment is not only a function of the size of the penalty, but also of the expected time interval between a violation and the implementation of the punishment. For any given response, the condition of more-than-proportional punishment is more likely to be achieved the more promptly the punishment is carried out. It is well known that procedures for internal enforcement can be very time-consuming. For example, prior to 1995 the GATT panel procedure was often criticized for its tardiness, taking an average of 18 months to settle a case (Hudec, 1990, p194). When the procedure underwent a fundamental revision in connection with the establishment of the WTO in 1995, this issue was a main concern. Under the new procedure, the timespan from the appointment of a panel to the rendering of a final decision should normally not exceed nine months (12 months if there is an appeal).11 While obviously the total interval from violation to punishment remains longer, the new procedure is no doubt faster than the one which preceded it. This revision is probably one important reason why the new panel procedure has become vastly more popular than its predecessor.12

The combination of slow regime procedures with relatively modest consequences can sometimes be deliberately exploited. In the late 1990s, Norway introduced a policy of reserving certain positions at Norwegian universities for women, with a view to enlarging the proportion of female to male faculty members. In August 2000, complaints about this policy were submitted to the EFTA (European Free Trade Association) Surveillance Authority (ESA),13 which in November 2001 found the policy to be in violation of the EEA (European Economic Area) principle of free competition in an open labour market. In March 2002, the ESA decided to bring the case before the EFTA court. Meanwhile, Norway continued to reserve positions for women, officially challenging the ESA's view of the practice as being inconsistent with EEA rules. Needless to say, in this case time worked in favour of the Norwegian government, in the sense that the longer the practice continued, the closer the government came to achieving its goal of a more gender-balanced faculty. Even if we assume that the Norwegian government realized that eventually it would have to give up the practice, it was certainly significant that this happened later rather than sooner. On the other hand, it is an open question whether the Norwegian government would have continued its practice for as long as it actually did, had the consequences of a conviction in the EFTA court been more severe.

Thus, to the extent that internal enforcement relies on collectively adopted procedures and due process, it tends to be time-consuming. This can, in turn, be a potential problem for deterrence. By contrast, external enforcement is often unilateral and therefore more easily compatible with expediency. It follows that external means of enforcement are likely to be relatively popular in cases where internal procedures are slow. On the other hand, if internal procedures are revised to become faster, more countries are likely to choose internal over external enforcement, as illustrated by the General Agreement on Tariffs and Trade (GATT)/WTO example.

Finally, internal schemes for enforcement are not always self-supporting. At one end, we have cases where the deterrent effect of internal measures is explicitly linked to external elements. For example, the Seabed Disputes Chamber of the International Tribunal for the Law of the Sea does not have any means of enforcement of its own. However, according to the statutes of the tribunal, the Chamber's decisions 'shall be enforceable in the territories of the State Parties in the same manner as judgments or orders of the highest court of the State Party in whose territory the enforcement is sought' (Article 39).

At the other end, we have cases where a regime or an organization is entitled to revoke some kind of privilege from a party that has been deemed to be in non-compliance. For example, the UN Charter says that 'a member of the organization which is in arrears in the payment of its financial contributions to the Organization shall have no vote in the General Assembly if the amount of its arrears equals or exceeds the amount of the contributions due from it for the preceding two full years' (Article 19). Similarly, a member of the UN against which preventive or enforcement action has been taken by the Security Council 'may be suspended from the exercise of the rights and privileges of membership by the General Assembly upon the recommendation of the Security Council' (Article 5). Finally, a member that has persistently violated the principles of the UN Charter 'may be expelled from the Organization by the General Assembly upon the recommendation of the Security Council' (Article 6). Given that membership is voluntary, we may safely assume that members see it as desirable to retain privileges of this kind. To the extent that a threat to revoke privileges is credible,14 it therefore provides a clear-cut incentive for compliance.15 And, unlike the mechanisms of the United Nations Convention on the Law of the Sea (UNCLOS), this incentive does not depend on external support of any kind.

At first sight, the enforcement mechanism found in the Marrakesh Accords appears to fall in the second category, i.e., the one of self-supporting internal enforcement. After all, revoking the right to participate in emissions trading, or reducing the assigned amount of emissions in future periods, looks much like suspending the right to vote, inasmuch as both types of penalty imply that a privilege is revoked (in part or in full). On closer inspection, however, there is an important difference. Subtraction of excess emissions from the assigned amount for the subsequent commitment period is costly only to the extent that a party sticks to its commitment to comply with the assigned amounts of future periods. If it should simply decide to ignore these obligations, there is little that the climate regime itself would be able to do. Similarly, if a country has its right to participate in emissions trading suspended, and responds by withdrawing from the Kyoto Protocol, the regime would be largely powerless.16 To be effective, therefore, both response options depend on support from external enforcement mechanisms. In principle, a party that has been punished by the Enforcement Branch could nullify the punishment by ignoring future obligations or withdrawing from the regime. In practice, however, external pressure from other countries may induce the party to adhere to its future commitments, thereby making the internal punishment imposed by the Enforcement Branch effective.

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