International commerce is a complex aspect of any business, and the addition of import and export regulations makes the task all the more tiresome. However, international trade regulations don’t exist solely to irritate businesses.
Instead, these regulations play an important role in protecting national interests and national security, and in many cases, global environments. While the tie between trade regulations and sustainability is not frequently discussed, import and export regulations play a large role in many countries’ sustainability goals.
3 Key Areas where Trade Regulations Protect the Environment
1. Ozone-Depleting Substances
Since the late 1980s, ozone-depleting substances have been strictly banned in a global agreement with the intent to reverse the severely harmful effects that these substances have had on the atmosphere.
- Outdated air conditioning and refrigeration equipment that uses chlorofluorocarbons
- Aerosol products and pressurized dispensers
- Cleaning fluids for electronic and photographic equipment
Trading these products across international borders requires comprehensive labeling and itemizing, with hefty fines and potentially punitive charges if proper protocols are ignored. While these may seem like excessive penalties, these regulations ensure that environmental efforts are a global initiative and prevent the risk of repeating the depleted ozone crisis of the 1980s.
The introduction of international trading protocols for ozone-depleting substances was the first major international regulation on environmentally hazardous products and paved the way for future import and export regulations to protect the environment and ensure environmental precautions are taken everywhere in the world.
Not only did these regulations show the huge power of import and export regulations, but they helped lay a blueprint for future environmental protection. Today, the Montreal Protocol is viewed as one of the most successful cooperative international agreements, as it actually had a clear impact on solving the environmental crisis it set out to fix.
2. Hazardous Chemicals
Chemicals are heavily regulated by international borders. These can include products that contain mercury, cleaning supplies, pesticides, herbicides, and other agricultural-based chemicals.
If these substances enter a country without proper clearance, they may pose severe risks to human and environmental health. When it comes to import and export regulations to protect the environment, controlling hazardous chemicals are some of the most important regulations to have.
In the case of chemical leakage into the environment, hazardous chemicals can pollute water, soil, and air, causing rapid cascades that affect all aspects of the environment, especially human health.
Regulating chemicals that come into a country can significantly reduce the risk of spills and exposures, and strict itemization and identification of chemicals can greatly reduce the time it takes to repair damages.
Chemical pollution is among the most severe and irreversible types of pollution, with chemical runoff posing a risk to expanding vicinities. As such, import and export regulations minimize the types of hazardous chemicals that can enter a country and ensure that they are properly secured, labeled, and processed.
One of the best examples of import regulations focused on the reduction of hazardous chemicals comes from the E.U.
In 2007, the European Union enacted the REACH regulation (Registration, Evaluation, Authorization, and Restriction of Chemicals) to moderate the flow of hazardous chemicals into the E.U.
REACH puts the burden of maintaining chemical safety onto industries that pass chemicals across European borders. Importers, as well as manufacturers, are required to compile information on all chemical substances that outlines safety protocols and potential risks (both to human health and the environment), and in the event of mishandling or a spill, the company is liable for cleanup.
REACH also compiles information on imported substances in a public database that allows consumers to find information on hazardous chemicals.
For companies selling chemical-laden products in the E.U., complying with REACH can actually be quite costly. The cost of applying for authorization of a chemical deemed “of very high concern” can cost up to US$72,000 for every use of the chemical.
In this way, REACH not only improves chemical safety and transparency in the E.U. but also creates a financial incentive for companies to do away with harmful chemicals altogether.
Many governments around the world vary in which chemicals they allow to pass through their borders. For example, the U.S. regulations under the Toxic Substances Control Act (TSCA) are somewhat less strict and less encompassing than the E.U.’s REACH regulation but still govern the importation of chemicals into the United States.
In order to import any chemical substance into the U.S., importers must follow a set of guidelines that helps the EPA ensure the safe use of chemicals in the country.
This is a crucial part of protecting human health and the environment from exposure to dangerous chemicals. No matter where the destination market is, importers and exporters alike should be aware of compliance regulations when taking part in international trade.
Every company produces waste, and removing waste can be a complicated process. Many businesses choose to ship their waste across borders for international disposal, which is typically a cheaper option than domestic disposal for companies with bulk waste.
Improper disposal of waste can lead to a significant increase in a company’s carbon value chain, as well as mass pollution from industrial, chemical, and solid waste. As such, import and export regulations strictly govern all types of waste, including:
Mismanaged waste can lead to severe environmental pollution, both during and after shipment. Most waste is transported via cargo ships, where an improperly labeled or unsecured waste container can result in extreme oceanic pollution.
Improperly handled medical waste is especially harmful to human health, as it can lead to infection transmissions.
Another common form of environmentally hazardous waste is electronic waste (also known as “e-waste”). When electronics are left to rot in landfills, they don’t break down quickly. However, over time, hazardous chemicals like heavy metals can leach out of electronics and into the soil, air, and water.
These heavy metals have been shown to harm wildlife and even humans. For example, cadmium can leach out of many electronics, where it accumulates in drinking water.
Exposure to cadmium can cause bone disease and other diseases in humans and also causes reproductive harm to many aquatic organisms.
You can learn more about the dangers of e-waste in the video by Interesting Engineering below:
Similar to the REACH regulation, the E.U.’s WEEE Directive (Waste Electrical and Electronic Equipment Regulation) aims to reduce the environmental and human health impacts of all e-waste entering the E.U. First and foremost, the WEEE Directive aims to prevent the creation of e-waste and encourage resource efficiency when manufacturing electronic devices.
To do so, this directive requires all electronic products sold in the E.U., including imported products, to be properly labeled to ensure the correct recycling of all e-waste. It also requires that e-waste be separated from other wastes in the disposal process to ensure no hazardous chemicals are mixed with non-hazardous substances, and all e-waste is properly recycled.
Transboundary movement of waste is typically not as regulated as other substances, but businesses should be aware of any potential standards they may face at the border.
Conclusion: Environmentally-Friendly Trade
From chemical regulations to waste regulations, both importers and exporters should be fully versed in the complexities of import and export regulations for every destination market and be aware of all potential obstacles they may face on either side of the border.
Some companies may choose to take advantage of auditing services that can walk them through their ethical and environmental impacts and minimize setbacks during international trade operations, while others may choose to rely on in-house experts for each market.
No matter how it’s achieved, compliance with these types of trade regulations paves the way for environmental protection that is directly tied to international trade.
Of course, regulating imports and exports is not the only way environmental protection can and should be achieved. We still need to work on creating goods that have a lower environmental impact altogether and lowering the carbon footprint of production worldwide.
However, import and export regulations to protect the environment represent an important opportunity for governments around the world to take more immediate action to protect the health of their citizens and their environment.
About the Author
David Evans is a freelance writer covering sustainability challenges and solutions. He writes to help companies and consumers understand the environmental and ethical challenges in products and their supply chains so we can find viable solutions for both.
Frequently Asked Questions
Can trade have positive impacts on the environment?
Increased trade can support economic growth and development as well as social welfare. While this can lead to degradation, it can also help smaller countries become more equipped to manage environmental issues effectively. For example, economic growth from trade can help make local production processes more environmentally friendly. Read the full guide to learn more.
Are there regulations on importing high carbon footprint products?
Yes. Some countries, like the E.U., have introduced border taxes on carbon-intensive imports. This was recently introduced in the U.S. Congress under the FAIR Transition and Competition Act, although it did not get as far as a vote. Read the full guide to learn more on how countries are limiting the import of high carbon products.
Are there environmentally-harmful chemicals the U.S. doesn’t regulate at its borders?
Yes. There are some classes of products that are subject to less strict (or no) import regulations in the U.S., such as medical devices, pesticides, and many products the military uses. For example, aircraft maintenance chemicals that contain CFCs (ozone-depleting substances) are exempt from regulations. Read the full guide to learn more about which chemicals are regulated at the U.S. boarders.