Retroactive and retrospective application

Legal assistance paper

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Date produced: 20/05/2012

1. What is the difference between retroactive and retrospective application of a treaty? Is it, in international law, possible to retroactively and/or retrospectively apply the second commitment period of the Kyoto Protocol?

2. Is it possible for New Zealand to provisionally apply the second commitment period of the Kyoto Protocol?

3. Is it possible for New Zealand to retrospectively and/or retroactively apply the second commitment period of the Kyoto Protocol? What are the risks of New Zealand retrospectively/retroactively applying the second commitment period of the Kyoto Protocol in respect of ultimately ensuring ratification of the amendments to the Kyoto Protocol?

Summary:

1. A retroactive statute operates as of a time prior to its enactment. It therefore operates backwards in that it changes the law from what it was. A retrospective statute operates for the future only. It is prospective, but imposes new results in respect of a past event. In the present context, it is unlikely that ‘ratification’ can be applied retroactively so as to make the signing of a treaty effectively the same as ratification of the treaty. However, there are some ways to make States liable for past events.

2. New Zealand has agreed to at least three other treaties provisionally entering force. If you would like analysis of the domestic procedure required to provisionally apply a treaty, we will require more time.

3. In our opinion, for New Zealand to apply the second commitment period of the Kyoto Protocol retrospectively and/or retroactively, there must be a clear provision for this in the amendment to the Kyoto Protocol.

Advice:

1. A retroactive statute operates as of a time prior to its enactment. It therefore operates backwards in that it changes the law from what it was.

A retrospective statute operates for the future only. It is prospective, but imposes new results in respect of a past event. It attaches new consequences for the future to an event that took place before the statute was enacted. It therefore changes the law from what it would otherwise have been with respect to a prior event. Retrospectivity can therefore be considered as a weak form of retroactivity.

The question arises as to whether the effect of ratification can be retroactive, so as to make a treaty binding from the date it was duly signed by representatives. There is no unanimity on this issue amongst publicists. Normally treaties themselves indicate the date from which they will take effect, so the question is generally of theoretical interest. The fact that ratification imparts the binding force to a treaty seems to indicate that ratification has regularly no retroactive effect. In the nineteenth century, some countries such the United States maintained that, when a treaty was ratified, it would operate retroactively to the time of signature, at least with respect to inter-state obligations, as opposed to private rights. This view was abandoned in the twentieth century, and the modern presumption under international law is that treaties do not operate retroactively. In conclusion, non-retroactivity of treaties seems well-established in international law.

Provisions of a treaty do not bind a party in relation to any act or fact which took place, or any situation which ceased to exist before the treaty enters into force for that party. This principle precludes the possibility of litigation arising out of situations or facts dating from a period when a State could not have foreseen that the circumstances might give rise to legal proceedings.

However, there are three established methods by which a treaty can be applied to an event which occurred prior to the treaty’s entry into force:

First, as recognised by Article 28 of the Vienna Convention on the Law of Treaties (‘the Vienna Convention’) a treaty may have retroactive effect if such an intention is expressed in the treaty, or is clearly to be implied from its terms. Article 28 of the VCLT now provides that “[u]nless a different intention appears from the treaty or is otherwise established, its provisions do not bind a party in relation to any act or fact which took place or any situation which ceased to exist before the date of the entry into force of the treaty with respect to that party.” Since it is only a presumption, it can be overridden by the parties to the treaty. Thus, there is nothing to prevent the parties from giving a treaty, or some of its provisions, retroactive effect. Essentially, it is a question of the parties’ intention as expressed, or implied in the treaty.

Second, the provisions of a treaty can apply to an act, fact, or situation which arose prior to the entry into force of the treaty and which subsequently continues to occur or exist. That is, a party can enforce a treaty against another party where the act constituting a breach occurred before the entry into force of the treaty, but continues to occur after entry into force as between the parties.

Third, absent an expressed or implied intention, or continuing breach, a treaty can be applied to an event which occurred prior to its entry into force where the treaty provision is a codification of customary international law. However, in such a case, what is applied is not the treaty provision, but the rule of customary international law codified by the provision.

2. According to the Vienna Convention the negotiating states can agree to apply ‘[a] treaty or a part of a treaty’ provisionally pending its entry into force. This represents a voluntary act of the state. If subsequently a national parliament refuses to ratify the treaty, the government concerned would notify the other states accordingly and discontinue the provisional application. The VCLT does not address the provisional application of amendments. A new or revised treaty instrument emerging from the climate negotiations could contain an express clause on its provisional application. It is therefore arguable (based on an a maiore ad minus conclusion) that an amendment to the Kyoto Protocol creating a subsequent commitment period could also be provisionally applied. To avoid a gap the amendment would need to be agreed prior to the expiration of the first commitment period.

Provisional application of treaties is a relatively normal affair in international law. Hereby some examples are given:

The 1994 United Nations International Tropical Timber Agreement, which was provisionally applied by a number of countries including Belgium, EU, Finland, France, Germany, Japan, Luxembourg, Netherlands, Spain and the UK.

The 1994 Energy Charter Treaty, which Belarus is currently applying provisionally. Russia did the same until 2009.

A number of bilateral agreements, such as the 1996 Agreement between the European Community and New Zealand on sanitary measures applicable to trade in live animals and animal products (which was applied provisionally until its entry into force in 2003) and the 2006 Agreement between the European Community and New Zealand on certain aspects of air services .

New Zealand has agreed to at least three other treaties provisionally entering force:  The 1994 Implementing Agreement on the International Seabed Authority; the 1995 Fish Stocks Agreement; and the FAO Agreement on Port State Measures to Prevent, Deter and Eliminate Illegal, Unreported and Unregulated Fishing; the 1996 agreement between the European Community and New Zealand on sanitary measures applicable to trade in live animals and animal products.

Moreover, a government guidance (the Ministry of Foreign Affairs and Trade International Treaty Making Guidance for Government Agencies on Practice and Procedures for Concluding Treaties and Arrangements (August 2011)) [The 2011 edition which is cited here is no longer available online but the 2012 edition can be found at http://www.mfat.govt.nz/downloads/treaties-and-international-law/International-Treaty-Making-Guide-2012.pdf], explicitly states the following in p.48:

Provisional entry into force may be allowed by the terms of a treaty, for example, in commodity agreements. Provisional entry into force of a treaty may also occur when a number of parties to a treaty that has not yet entered into force decide to apply the treaty as if it had entered into force. Once a treaty has entered into force provisionally, it creates obligations for the parties that agreed to bring it into force in that manner. See article 25(1) of the Vienna Convention 1969.

3. From the above, it would seem that for New Zealand to apply the second commitment period of the Kyoto Protocol retrospectively and/or retroactively, that possibility must be made clear by the amendment to the Kyoto Protocol itself. Otherwise only provisional application would seem possible.

If the amendment did provide for retroactive and/or retrospective application then an obvious risk is that if that party never in fact ratifies the amendment then no obligation to apply the amendment retroactively and/or retrospectively will arise.