A Human Right to Carbon Import Restrictions? On the Notion of ‘Embedded Emissions’ in Klimaseniorinnen v Switzerland

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The European Court of Human Rights’ (ECtHR) climate decisions are out, and comments followed suit (for general overviews: here, here, and here; for related discussions of the notion of a carbon budget in the decisions: here and here). If anything about the decisions’ legal and factual implications is sure, it is that it will keep scholars busy for some years to come. In this brief post, I want to shed some light on one central aspect of the findings in Klimaseniorinnen v Switzerland which has so far not received the attention it deserves: The ECtHR’s findings on States’ responsibility to mitigate not only emissions stemming from their territory but also what plaintiffs referred to as ‘embedded emissions’. To be more precise, the emissions caused in the production processes of goods imported into a State, in our case, Switzerland. The question of whether States are responsible only for emissions emitted on their territory or beyond, can make a huge difference. In the case of Switzerland, this is particularly striking, as the country had an estimated 35.38 million metric tons of CO2 emissions emitted from its territory in 2022 but a much bigger consumption-based footprint of 118.68 million metric tons (see here). Establishing a human rights obligation to reduce embedded emissions beyond a State’s territory would also go beyond the findings of national courts in Urgenda v Netherlands, Neubauer et al v Germany, and VZW Klimaatzaak v Belgium, all of which focus heavily on territorial emissions. Ultimately, it could require States to adopt import restrictions, sustainability supply chain legislation, or carbon border adjustment to reduce their carbon footprint abroad. All of which raise concerns from an international trade law perspective and may also undermine common but differentiated responsibility (CBDR) under international climate law.

The ECtHR’s Treatment of Embedded Emissions

The applicants explicitly raised the issue of embedded emissions only at a late stage in the proceedings. Thus, the ECtHR first had to treat the question of whether the matter formed part of the initial complaint and could thus be adjudicated in the present case – which judges ultimately confirmed. Beyond these procedural questions, the Court seemed, however, to affirm that Switzerland could indeed be held responsible for embedded emissions. In particular, it noted that Swiss authorities accepted in reports ‘that the GHG emissions attributable to Switzerland through the import of goods and their consumption form a significant part (an estimate of 70% for 2015) of the overall Swiss GHG footprint’ (para. 278). It added that ‘[i]t would therefore be difficult, if not impossible, to discuss Switzerland’s responsibility for the effects of its GHG emissions on the applicants’ rights without taking into account the emissions generated through the import of goods and their consumption or, as the applicants labelled them, “embedded emissions”’ (para. 280). While the Court ultimately highlighted that an examination of the question of whether embedded emissions are covered by the State’s responsibility under the Convention was an issue to be decided in the merits (para. 283), these findings already indicate a certain preference.

The second part where the Court dealt with embedded emissions was on the matter of jurisdiction. The court saw ‘no genuine issue of jurisdiction’ in that regard because all applicants are residents of Switzerland and under its territorial jurisdiction, even though embedded emissions themselves are clearly not. This is particularly interesting because scholarship on corporate climate due diligence often assumes that the matter of accountability for foreign emissions is an extraterritorial matter and thus not within States’ jurisdiction – or at least only controversially so under notions of extraterritorial human rights obligations (which the Court rejected in Duarte Agostinho et al v Portugal et al). However, even though the Court acknowledged that territorial jurisdiction covers embedded emissions, judges also stressed that the issue of responsibility would need to be examined on the merits, and only so ‘if necessary’ (para. 287).

After this section, the term embedded emissions only pops up again in the partly concurring, partly dissenting opinion of Judge Eicke. Apparently, judges did not see the necessity to examine the controversial issue further as they found the failure to quantify the remaining GHG emissions of Switzerland through national regulatory limitations and the failure to comply with earlier GHG emission reduction targets to already constitute a violation of positive obligations under Article 8 ECHR (para. 573). However, Judge Eicke seems to assume that the court unequivocally accepted a primary duty of Member States to adopt and effectively apply regulations and other measures ‘covering both emissions emanating from within their territorial jurisdiction as well as “embedded emissions” (i.e. those generated through the import of goods and their consumption)’ (para. 4).

From my perspective, this is all but clear. In fact, all sections dealing with the notion of a carbon budget and the ‘fair share’ of Switzerland address territorial emissions only (in particular para. 569 referring to para. 323, see also: para. 326). Given the above-mentioned supportive findings, it may well be that the Court in future cases requires States to include embedded emissions in their regulatory frameworks and national carbon budgets, but for now, the Court did not clearly decide the issue.

Why States Are Required to Mitigate Their Extraterritorial GHG Footprint

This leads us to consider how the ECtHR or national courts might approach this issue in future cases. In my view, there are compelling doctrinal grounds for holding States accountable for their GHG footprint abroad under human rights law. However, the bottom-up framework of international climate law necessitates a cautious approach. Let me explain.

The primary rationale why States must address the GHG footprint of their economies abroad is the simple fact that GHG emissions impact on human rights of individuals within a State’s territorial jurisdiction, regardless of where they are emitted. In line with general positive obligations doctrine, a State’s responsibility for emissions abroad hinges less on whether these emissions are directly attributable to the State and more on whether the State can influence their reduction. This may require States, as the German Federal Constitutional Court highlighted in its climate decision (para. 149 and 199), to engage in international climate negotiations and convince others via diplomacy to mitigate their territorial emissions. However, it may also require States to implement more controversial legal instruments such as carbon border adjustment mechanisms or mandatory corporate climate due diligence along global supply chains. Notably, the Committee on the Rights of the Child (CRC) argues that States face an obligation to regulate businesses operating within their markets to ensure ‘that they identify, prevent, mitigate and account for how they address actual and potential adverse climate change-related impacts on children’s rights, including those resulting from production-related and consumption-related activities and those connected to their value chains and global operations’ (CRC General Comment No. 26 (2023) para. 107-108).

The Margin of Appreciation as Regards the Choice of Means

It is however unlikely that the ECtHR would go that far, given that it continues to highlight the margin of appreciation of States regarding the choice of means to reduce GHG emissions (para. 543). States have a plethora of policy options for diminishing their GHG footprint abroad. For instance, they could endeavor to regulate the demand side within their jurisdictions or offer incentives to discourage the consumption of products with high embedded carbon emissions. Likewise, they could augment financial and technology transfers to diminish their global consumption-based GHG footprint, especially with regard to trading partners in the Global South.

At the same time, it is essential to acknowledge that the margin of appreciation, and more generally the availability of less restrictive interventions, may narrow as the global carbon budget continues to deplete. Eventually, this could necessitate the adoption of more restrictive measures to prevent consumption within one State’s economy from exacerbating carbon emissions elsewhere. The same may hold true for investment decisions that contribute to carbon emissions abroad (see on the notion of unextractable fossil fuels: here and here).

Conflicts with other Areas of International Law?

Regulating the consumption-based footprint of one economy inevitably intersects with the territorial production-based footprint of other economies, potentially being perceived as stepping on the toes of other sovereigns. This raises concerns regarding conflicting obligations under international climate law and international trade law. With WTO panels increasingly recognizing environmental exceptions under Article XX GATT and elsewhere as justifying climate-related trade restrictions (see the recent Panel decision in EU – Palm Oil, in particular, para. 7.314), many forms of regulating and reducing embedded emissions seem justifiable.

Similarly, international climate law may not pose as much of an obstacle despite its territorial approach. As correctly emphasized by the government of Switzerland, the Paris Agreement emphasizes ‘national contributions’ (para. 276). The ‘economy-wide’ reduction commitments and ‘domestic mitigation measures’ outlined in the Paris Agreement typically pertain only to territorial emissions. This logic also underpins mechanisms for emissions trading and transfers between States. Operating under the bottom-up approach adopted in the Paris Agreement, each State has relative discretion to determine its national contribution to the overall objective, aligned with principles of common but differentiated responsibility and non-retrogression.

At the same time, it is hard to conceive of the Paris Agreement as a defence shield for States unwilling to reduce their production-based carbon emissions. The Paris Agreement does not require States to address their consumption-based GHG footprint abroad but equally does not prohibit them from doing so. While the principle of common but differentiated responsibility may support differential treatment of imports from developing countries (see for more concrete proposals in that regard: here), Switzerland primarily imports from developed countries. However, this might vary for other States, thereby necessitating equity considerations under the principle of common but differentiated responsibility to inform their approaches to reducing embedded emissions and their GHG footprint abroad.

Conclusion

Although the ECtHR ultimately did not decide the issue on the merits, its findings on embedded emissions point in the direction that States can be held accountable for failing to reduce their economies’ extraterritorial GHG footprints. Thus, Parties to the ECHR are well advised to make regulatory adjustments to include embedded emissions in their legal frameworks and national carbon budgets. While human rights obligations may not require States to adopt a particular trade instrument to restrict the import of embedded emissions, such legal instruments could be part of the solution. If so, they would require refinement to address equity concerns within international climate law.

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