Vidigal: Designing Climate Clubs: The Four Models, Trade Commitments and the Non-Discrimination Dilemma

Geraldo Vidigal (Univ. of Amsterdam - Law) has posted Designing Climate Clubs: The Four Models, Trade Commitments and the Non-Discrimination Dilemma. Here's the abstract:

The imminent adoption of climate-motivated trade restrictions has led to renewed interest in climate clubs (CC), by which club participants limit the application of trade restrictions to countries that fail to contribute sufficiently to emissions reduction efforts. Within the decentralized international system, small-group cooperation among climatically ambitious states may be instrumental in making climate cooperation politically feasible. In particular, decarbonizing carbon-intensive sectors may require a “club” approach. This paper analyses the main CC models being proposed, classifying them as “inducive” or “equalizing” and “exclusive” or “inclusive”. If adopted unilaterally (or “minilaterally”, by a group such as the G7), all models are likely to be contentious, either unjustifiably favoring one policy design over others or setting up arbitrary distinctions between admissible and inadmissible contributing measures. Regardless of formal legal challenges, a CC imposed without multilaterally negotiated criteria is bound to create trade tensions. A credible outcome of current proposals is a CC component within a (de jure or de facto) multilateral climate governance (MCG) system, whose residual club component operates less as an exclusive club than as a fallback element to ensure continued adherence to the governance system. To avoid pitfalls, the design of a CC must match the stated objective of decarbonizing production while allowing participants a broad measure of freedom regarding policy choices. A CC component may be permissible as a means of eliminating incentives for free riding through non-participation, as long as the MCG sets for those within the club corresponding criteria for acceptable contributing measures, established means of assessing compliance, and commensurate consequences for non-compliance.