137 



Still the governments can refuse to answer a citizen's request, or scale back the re- 

 quest. 



The negotiators have made progress in the dispute process of the Commission, 

 when compared to NAFTA's dispute resolution. It will set up a roster of panelists 

 that include panelists that have environmental expertise. However, this does not ex- 

 tend to NAFTA's dispute panel where environmental experts are not mentioned or 

 required. This difference is crucial because any challenges to U.S. environmental, 

 health or safety laws will be resolved in the NAFTA dispute process. 



II. CARBON II: A HYPOTHETICAL CASE 



In recent weeks there have been a number of press reports about the Carbon II 

 coal-fired power plant facility under construction in Mexico near the U.S. border 

 town of Eagle Pass, Texas, 140 miles southeast of Big Bend National Park. The coal- 

 fired plants may be exporting energy to the United States. 



Carbon II will lack scrubbers and pollution control devices for sulfur dioxide that 

 would be standard equipment on a newly constructed power plant in the U.S. Envi- 

 ronmentalists are concerned that its emissions will cause air pollution problems on 

 the U.S. side of the border and impact Big Bend National Park. We would like to 

 imagine how this situation would be addressed by the environmental side agree- 

 ment. 



First, let's assume that a citizen's group like Friends of the Earth wishes to take 

 action to try to stop transboundary pollution. It could lodge a complaint with the 

 Commission, which can be denied. If it is accepted, the Commission could undertake 

 a report. It could not conduct its own independent analyses of air quality or sub- 

 poena plant managers or directors. It could only ask the Mexican and U.S. govern- 

 ments to provide existing information. The governments can then simply refuse, 

 saying the demand is burdensome. If the governments provide information, the 

 Commission can write a report and make recommendations. If two of the three 

 countries agree, the report can be made public, otherwise it remains confidential. 



It would he impossible for an individual or an organization like Friends of the 

 Earth to initiate the process which might eventually lead to formal sanctions. Such 

 actions can only come at the request of governments, and with the support of two- 

 third's of the parties. 



If the U.S. Government decided to bring a formal complaint about Carbon II it 

 would have to prove that the pollution is being caused by Mexico's lax enforcement 

 of an existing law, not for the failure to set regulatory standards. According to the 

 Wall Street Journal, the Mexican embassy has already said that the plant "meets 

 or exceeds all applicable national and international pollution standards." If that is 

 true, the Commission can do nothing. Second, the United States would have to 

 prove that the violation is part of a "persistent pattern" of nonenforcement. While 

 the meaning of this term is unclear and will likely be resolved through precedent, 

 the United States will have to wait until the plant is operating and will have to 

 show that the violations of environmental laws have been persistent. It may also 

 need to prove not just that this plant is in violation but that the whole Mexican 

 power sector is in violation. 



If these difficult points were proven, Mexico could then simply claim that enforc- 

 ing pollution control on coal-fired plants is not a priority and the lack of attention 

 "results from a bona fide decision to allocate enforcement resources to violations de- 

 termined to have higher priorities" such as air pollution in Mexico City. 



If the United States were able to surmount these difficulties and succeed in levy- 

 ing sanctions, the most it could collect is $20 million dollars. According to the U.S. 

 EPA the costs of installing scrubbers to meet U.S. air emission standards would be 

 around $300 million simply to control sulfur dioxide, not to mention nitrogen oxide. 

 Given such costs, at the end of the day, paying the fine would be a bargain for Mex- 

 ico. 



III. CASE STUDY OF REEXPORTING HAZARDOUS WASTES 



Annex III of the 1983 La Paz Agreement and the 1988 Mexican Law of General 

 Equilibrium require maquiladora industries to export their hazardous waste to the 

 country of origin for treatment and disposal. The thinking behind this agreement 

 is that Mexico lacks facilities to treat these wastes in a manner equivalent to the 

 treatment they would receive in the United States. 



The U.S. -owned maquiladoras widely flaunt this law. The Environmental Protec- 

 tion Agency estimates that only about one-third of the hazardous waste generated 

 in the maquiladoras is returned to the United States, leaving somewhere around 

 20,000 tons in Mexico. 



