XXX — International equity

Chapitre XXX

INTERNATIONAL EQUITY

Free trade is only free if it is fair. When an imported product does not comply with the standards imposed on domestic producers, it is not trade—it is dumping. The domestic market then becomes a playground for those who cheat.

30.1 — Regulatory dumping: legalized theft

A French farmer must comply with hundreds of standards: banned pesticides, animal welfare, traceability, social standards for employees, environmental regulations. These constraints have a cost. They increase production costs.

Meanwhile, a foreign producer can use banned pesticides, exploit underpaid labor, pollute without constraint, and export freely to that same French market. Their product arrives cheaper—not because they are more efficient, but because they do not follow the rules of the game.

This is institutionalized unfair competition. The State imposes standards on its citizens, then exposes them to competition from those who do not have these same constraints. It creates a handicap, then punishes those it has handicapped.

It is not protectionism to refuse this asymmetry. It is consistency.

30.2 — The five domains of regulatory dumping

The problem crosses all sectors. Each type of standard creates a specific distortion:

1. Economic and competition standards. Massive state subsidies, monetary dumping, artificial transfer pricing, non-compliance with antitrust rules. A Chinese company subsidized at 30% can sell at a loss to eliminate European competition—then raise its prices once the market is conquered.

2. Agricultural standards. Banned pesticides, unauthorized GMOs, antibiotics as growth accelerators, animal meal. American hormone-fed beef, chlorinated chicken, adulterated Chinese honey, fruits treated with dichlorvos. All products banned for domestic production, but tolerated for import.

3. Health and public health standards. Banned food additives, medicinal residues, industrial contaminants, failure to respect the cold chain. Border controls detect only a tiny fraction of violations. The consumer believes they are buying a compliant product.

4. Environmental standards. CO2 emissions, water pollution, forest destruction, destructive mining. A product manufactured in a country without environmental constraints actually exports its pollution—and its competitive advantage rests on this unpaid externality.

5. Social standards. Child labor, absence of minimum wage, dangerous working conditions, union repression. The 3-euro T-shirt is not a miracle of productivity—it is the price of human exploitation.

30.3 — The principle of regulatory equality

The solution is neither protectionism nor extraterritoriality. It rests on a simple principle: any product sold on the domestic market must comply with the standards applicable to domestic products.

This is not imposing our law abroad. It is imposing our conditions of access to our market. A fundamental nuance.

What this means concretely:

• A pesticide banned in France cannot be present in a product imported to France
• A product manufactured by children cannot be sold in France
• A factory that pollutes without constraint cannot export freely to France
• A competitor unfairly subsidized cannot freely compete with French companies

What this does not mean:

• Imposing the French Labor Code on China
• Requiring Brazil to apply our environmental standards on its territory
• Banning imports in general

The foreign producer remains free in their methods. But if they want access to the domestic market, they must prove that their product complies with national standards. It is a condition of access, not an extraterritorial imposition.

30.4 — The implementation mechanism

A principle without an implementation mechanism is a declaration of intent. Here are the operational tools:

1. Legal responsibility of the market operator

The importer or distributor who places a product on the domestic market is legally responsible for its compliance. They cannot hide behind the foreign producer. They are the ones who answer before national courts, with their national assets.

This responsibility is civil (compensation for victims), administrative (market withdrawal, import ban), and criminal (personal sanctions in case of characterized fraud or deliberate endangerment).

2. Certification and traceability obligation

The importer must be able to prove the compliance of their products. This involves:

• Certification by accredited organizations (national or recognized international)
• Complete traceability of the production chain
• Periodic audits of foreign production sites
• A sworn declaration engaging the criminal responsibility of the manager

The cost of this certification is borne by the importer. It is the price of market access.

3. Targeted risk-based controls

It is impossible to control all products at the border. Controls are therefore targeted according to:

• Country of origin (compliance history)
• Sector (agri-food, textile, chemistry)
• Importer (track record, volume)
• Alerts (reports, whistleblowers, media monitoring)

High-risk products are systematically controlled. Virtuous importers benefit from reduced controls. The system rewards compliance.

4. Dissuasive sanctions

The economics of fraud are simple: if the expected gain exceeds the expected cost (sanction × probability of detection), fraud is rational. To reverse this calculation:

• Financial sanctions proportional to turnover (not to the product concerned)
• Confiscation of profits from fraud
• Temporary or permanent import ban
• Personal criminal sanctions for managers in case of recidivism or systemic fraud
• Publication of convictions (reputational damage)

The goal is not to punish, but to make compliance more profitable than fraud.

30.5 — Articulation with international trade

This system fits within the framework of the hierarchy of norms established in this document:

1. National Constitution → defines fundamental principles, including the principle of regulatory equality

2. National laws → define applicable standards (environmental, health, social, etc.)

3. International treaties → can facilitate mutual recognition, but cannot impose unconditional market opening

This hierarchy has a direct consequence: a free trade treaty that would prohibit the country from conditioning access to its market on compliance with its standards would be unconstitutional.

Existing treaties that contravene this principle can be renegotiated or denounced. The chapter on international treaties details the exit mechanisms.

WTO compatibility

The World Trade Organization authorizes sanitary and phytosanitary measures (SPS Agreement) and technical barriers to trade (TBT Agreement) under certain conditions: non-discrimination, proportionality, scientific basis. The principle of regulatory equality meets these criteria:

• It is non-discriminatory: it applies to all foreign countries in the same way
• It is proportional: it only requires compliance with standards applicable to domestic producers
• It has an objective basis: national standards are defined by law, not by administrative arbitrariness

This is not a disguised customs barrier. It is the consistent application of national rules.

30.6 — Objections and their responses

“This is disguised protectionism”

No. Protectionism consists of protecting domestic producers from foreign competition, even fair. Regulatory equality consists of imposing the same rules on everyone. If a foreign producer can manufacture in compliance with national standards at lower cost, they retain their advantage. Only the advantage from non-compliance with standards is neutralized.

“This will increase prices for consumers”

Yes, partially. But the current low price is an illusion: it externalizes costs (environmental, health, social) that will be paid otherwise—by health systems, by environmental degradation, by unemployment of domestic producers. The “full” price is more honest.

“It is impossible to control”

Not perfectly, no. But the certification obligation, importer responsibility, and dissuasive sanctions change the economic calculation. It is not about achieving perfect compliance, but making systemic fraud unprofitable.

“Other countries will exercise reprisals”

Possible. But a country that exercises reprisals because they are asked to follow the rules of the game reveals its intentions. And a market of solvent consumers remains attractive. Reprisals have a cost for those who exercise them.

“The European Union prohibits it”

See the chapter on international treaties. A treaty that prevents a people from protecting its health, its environment, and its workers is not an acceptable treaty. It can be renegotiated or denounced.

30.7 — Constitutional formulation

The principle of regulatory equality can be enshrined in the Constitution in these terms:

Article X — Regulatory equality in commercial exchanges

No product or service may be placed on the domestic market if it does not comply with the health, environmental, social, and commercial fairness standards applicable to domestic products and services.

The law defines the conditions of certification, control, and sanction guaranteeing the application of this principle.

International trade agreements may not derogate from this rule.

This formulation is:

• Short: a principle, not a catalog
• Clear: the criterion is compliance with standards applicable to nationals
• Unambiguous: international agreements cannot derogate from it
• Operational: it refers to the law for modalities

30.8 — Case study (empirical example): The Carbon Border Adjustment Mechanism (CBAM, 2023-present)

The European Union adopted in 2023 the CBAM (Carbon Border Adjustment Mechanism), the first large-scale device applying a logic of environmental regulatory equality [157][158].

What works

Application of the polluter pays principle to imports. Importers of carbon-intensive products (steel, cement, aluminum, fertilizers, electricity) must purchase certificates corresponding to the CO2 emissions incorporated in their products [157]. The price is aligned with the European carbon market (EU ETS).

Equalization of competitive conditions. A European steel producer subject to the carbon price is no longer disadvantaged compared to a Chinese or Indian competitor who does not pay this cost. The regulatory asymmetry is neutralized.

Price signal for foreign producers. Exporting countries have an incentive to adopt their own carbon pricing mechanisms. If they do, their exporters can deduct the price already paid from the European certificate.

Defended WTO compatibility. The European Commission has built the mechanism to respect non-discrimination criteria: it applies uniformly to all third countries, it is based on an objective method of calculating emissions, and it offers exemptions to countries with equivalent devices.

What poses problems

Limited scope. The CBAM only covers a few industrial sectors. Complex manufactured products (cars, electronics) are not concerned. Neither is textile. The logic is not generalized.

Traceability fraud. Declared emissions rely on data provided by producers. Verification of Chinese or Indian factories is difficult. Default certificates (country average values) can be diverted.

Trade reprisals. China, India, and other countries have denounced the mechanism as a disguised protectionist barrier [158]. Retaliatory measures are possible.

Administrative complexity. Importers must document emissions product by product. For complex supply chains, this is a logistical nightmare.

No extension to other standards. The CBAM only concerns carbon. Social, health, agricultural standards are not covered. It is partial regulatory equality.

What we keep from the European model

• The equalization principle: importers pay the cost of standards they did not respect upstream
• The sought WTO compatibility: non-discrimination, objective basis, exemptions for equivalence
• The certificate mechanism: monetization of the regulatory differential
• The harmonization incentive: exporting countries have an interest in adopting equivalent standards

What we improve

• Extension to all regulatory domains: our system is not limited to carbon—it covers all standards (health, social, environmental, agricultural)
• Importer responsibility: instead of a complex certificate system, it is the importer who is responsible for compliance, with their assets
• Personal criminal sanctions: fraud is not just a matter of certificates, it engages the responsibility of managers
• Constitutionalization: the principle is enshrined in the supreme norm, not in a modifiable regulation

What we do not adopt

• Sectoral limitation: our system is general, not limited to a few industries
• Certificate complexity: our system relies on prior certification and responsibility, not on a market for pollution rights
• European level: our system is national and sovereign, articulated with the hierarchy of norms established in this document

30.9 — International trade is not a dogma

Free trade has created wealth. But asymmetric free trade creates losers: workers competing with those who do not have their rights, farmers competing with those who do not have their constraints, companies competing with those who externalize their costs.

These losers are not acceptable collateral victims. They are full citizens, and their protection is a legitimate function of the State.

International trade must be an exchange between partners who play by the same rules—not a competition between those who respect standards and those who ignore them.

This chapter establishes this principle. The next chapter deals with mechanisms to ensure that international treaties remain in the service of the people, not the reverse.