Border carbon adjustment compliance and the WTO: the interactional evolution of law

Abstract

Abstract International law and its understanding can evolve outside of treaties, but little is known about the elements that can explain these changes. This paper looks at the debate on border carbon adjustment (BCA) compatibility with the World Trade Organization (WTO) and argues that international law depends on the actors’ perceptions, which can change over time. It applies an interactional international law framework to explain how a policy that was once deemed incompatible with WTO rules is now considered ‘WTO-compliant’ by the European Union. A discourse network analysis is conducted based on debates from the WTO and the literature over 24 years. Results show that since 2012, the legal literature has increasingly been more confident that BCA could be WTO-compatible, despite the absence of significant changes in WTO case law during the same period. This increase in support was sustained by an expanded practice of legality and a perceived lack of legality of applicable WTO rules. This research offers new insights into the dynamics of international law. It provides new methodological avenues for scholars seeking to trace the evolution of law and legal understanding through formal and informal processes.