Reproductive outsourcing to India: WTO obligations in the absence of US national legislation

Journal of World Trade

Volumn 43, Issue 1, 2009, Pages 189-208

  Stephenson, Christina ^a  

^a University of Oregon School of Law   (United States)

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[No Author keywords available]

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EID: 84860745854     PISSN: 10116702     EISSN: None     Source Type: Journal    
DOI: 10.54648/trad2009007     Document Type: Article

References (110)

1. E.g., Stephanie Overby, Inside Outsourcing in India, CIO, 1 Jun2003, .
2. Government of India Department of Tourism and Ministry of Health and Family Welfare, Incredible India: The Global Healthcare Destination, (last visited 18 Apr2008)
3. see alsoChinai, Rupa, & Rahul Goswami, Medical Visas Mark Growth of Indian Medical Tourism, World Health Organization (2007) .
4. Government of India Department of Tourism and Ministry of Health and Family Welfare, Incredible India: The Global Healthcare Destination, (last visited 18 Apr. 2008).
5. Chinai, Rupa & Rahul Goswami, Medical Visas Mark Growth of Indian Medical Tourism, World Health Organization (2007) .
6. Amelia Gentleman, India Nurtures Business of Surrogate Motherhood, N.Y. Times, 10 Mar. 2008, available at .
7. International surrogacy would likely fit into the paradigm of 'fertility tourism' explored in Richard F. Storrow, 'Quests for Conception: Fertility Tourists, Globalization and Feminist Legal Theory', Hastings L. J. 57 (2005): 295.
8. Despite discussions on a formal law on surrogacy, as of yet there appears to be no law in India forbidding surrogacy. Mahendra Kumar Singh, 'New Laws to Rein in "Womb Business"', The Times of India, 31 Oct. 2007, available at http://timesofindia.indiatimes.com/India/Govt_mulls_laws_to_regulate_surrogacy/articleshow/2503791.cms.
9. see also, e.g., Sam Dolnick, 'Pregnancy Becomes Latest Job Outsourced to India', USA Today, 2007, available at .
10. There are, however, guidelines, promulgated by the Ministry of Health and Family Welfare which regulate the practice of surrogacy; with these regulations in mind one can infer that at the very least surrogacy enjoys tacit approval by the Indian government. Indian Council of Medical Research, National Academy of Medical Sciences, & Ministry of Health and Family Welfare. National Guidelines for Accreditation, Supervision and Regulation of ART Clinics in India, 2005, available at www.icmr.nic.in/art/art_clinics.htm
11. for state laws on surrogacy see notes 95-98 infra.
12. E.g., B.R. Sharma, 'Forensic Considerations of Surrogacy', Journal of Clinical Forensic Medicine 13 (2006): 80, 81 (2005).
13. Charles P. Kindregan, Assisted Reproductive Technology: A Lawyer's Guide to Emerging Law and Science, 187-188 (2006).
14. Male gametes are sperm and female gametes are eggs. See The American Heritage College Dictionary 559 (3d ed. 1993).
15. Consider the famous New Jersey case In re Baby M, 525 A.2d 1128 (N.J. Super. Ct. Ch. Div. 1987); see also Christine Kerian, 'Surrogacy: A Last Resort Alternative for Infertile Women or a Commodification of Women's Bodies and Children?', Wis. Women's L.J. 12 (1997): 113, 124-132 (discussing the case and its impacts).
16. See Jean M. Sera, 'Surrogacy and Prostitution: A Comparative Analysis', Am. U. J. Gender & L. 5 (1997): 315.
17. See Kerian, Surrogacy, supra at 158-165 (exploring the various arguments for and against surrogacy).
18. see also Sera, 'Surrogacy and Prostitution', supra at 321.
19. See Kerian, Surrogacy, supra at 160-161.
20. Giving Birth the Latest Job Outsourced to India, MSNBC, 30 Dec. 2007, available at ('You can picture the wealthy couples of the West deciding that pregnancy is just not worth the trouble anymore and the whole industry will be farmed out', comments Dr. John Lantos of the Center for Practical Bioethics in Kansas City, MO).
21. Iris Leibowitz-Dori, 'Womb for Rent: The Future of International Trade in Surrogacy', Minn. J. Global Trade 6 (1997): 329. (Noting the relative prevalence of illegal international trade in surrogacy and arguing for legalization and international regulation.)
22. Gentleman, India, supra.
23. see also Indian Council of Medical Research, National, supra. (Detailing the procedure regarding sperm and oocyte donation.)
24. Indian, National, supra at Ch. 3, § 3.5.4. 'An oocyte donor can not act as a surrogate mother for the couple to whom the ooctye is being donated.' While they are the product of a Governmental Ministry, there are as yet non-binding regulations.
25. Rotunda IVF Clinic FAQ. OneinSix. (last visited 18 Apr. 2008).
26. In addition, to assure maternal health Indian regulations prohibit a woman from acting as a surrogate more than three times in her life. Indian, National, supra at Ch. 3, § 3.10.8.
27. Anuj Chopra, Childless Couples Look to India for Surrogate Mothers, Christian Science Monitor, 3 Apr. 2006, available at .
28. ('In India, the entire costs range from $2,500 to $6,500.') cf. Gentleman, India, supra. ('The cost comes to about $25,000...'.) In addition, there does not appear to be any information on the number of persons or couples (US or otherwise) who use international surrogacy arrangements with either women from India or any other country. This is likely due to the fact the there are many independent operators and these arrangements rarely need to interface with current legal systems.
29. Rotunda, supra
30. see also Posting of administrator to Rotunda's Previous Years Costs (4 Dec. 2007. 23) . (Noting the recent increase in price of Indian surrogacy the administrator of the OneinSix website comments, 'The days of exploiting the poor are over [sob, sob].')
31. Rotunda, supra.
32. Posting of administrator to Rotunda's Previous Years Costs (4 Dec. 2007. 23) .
33. Indian Clinics, OneinSix, available at (last visited 18 Apr. 2008).
34. Mike Celizic, More and More Couples Finding Surrogates in India, MSNBC, 20 Feb. 2008, available at .
35. Henry Chu, Wombs for Rent Cheap, Truthout, 19 Apr. 2006, available at .
36. Chopra, Childless, supra.
37. Abigail Haworth, Surrogate Mothers: Wombs for Rent, Marie Claire, 2007, available at .
38. For a critical look at international adoption and market forces see Michele Goodwin, 'The Free-Market Approach to Adoption: The Value of a Baby', B.C. Third World L. J. 26 (2006): 61.
39. In the case where a person or couple is using donated gametes the baby will be genetically unrelated to both them and the surrogate. In this case they will likely have to establish legal rights over the child pursuant to the adoption laws of the state.
40. Kindregan, Assisted, supra.
41. Indian Council of Medical Research, National, supra at Ch. 3, § 3.5.4. ('The birth certificate shall be in the name of the genetic parents.')
42. US Department of State, Acquisition of U.S. Citizenship by a Child Born Abroad, available at (last visited 21 Apr. 2008).
43. Art. II, s. 1 of the US Constitution states that, 'No Person except a natural born citizen... shall be eligible to the Office of the President.' With no definition of a natural born citizen embedded in the Constitution, commentators have debated its contours. In the absence of a Supreme Court decision on the definition, it is unclear whether a surrogate child born in India through this gestational process would be eligible for the highest office in the United States. For an interesting take of the definition of natural born citizenship see Elwood Earl Sanders, Jr, 'Could Arnold Schwarzenegger Run for President Now?', Fla. Coastal L. Rev. 6 (2005): 331.
44. Gentleman, India, supra. ('Rudy Rupak, co-founder and president of PlanetHospital, a medical tourism agency with headquarters in California, said he expected to send at least 100 couples to India this year for surrogacy, up from 25 in 2007, the first year he offered the service.')
45. According to Graham Dunkley, '... mainstream economists have largely agreed that any nation can benefit eco nomically by specializing and trading in production of goods and services for which it has a "comparative advantage"; that is absolute advantage. A country that has an absolute advantage in two goods would have a comparative advantage in the one good, of the two, that it can produce the most efficiently. The theory holds that the country should choose the good in which it has the comparative advantage and trade to meet the rest of its needs. Charles Kindleberger, International Economics, 5th edn (1973), 17-21, 27, 33.
46. But see David Morris, The Case against Free Trade (Earth Island Press, 1993), 150, 157 (assessing the assumptions built into the model of free trade and concluding, 'The theory of comparative advantage itself is fast losing its credibility... free trade as it is preached today nurtures and reinforces many of our worst problems.')
47. Under the GATT the US has made a variety of commitments with regard to trade in goods. In particular the GATT is driven by the principles of 'the substantial reduction of tariffs and other barriers to trade'. GATT, Oct. 30, 1947, 61 Stat. A-11, 55 U.N.T.S. 194; Under the GATS, the US has similarly made commitments with regard to services guided by the desire for 'the early achievement of progressively higher levels of liberalization of trade in services'. General Agreement on Trade in Services, Apr. 15, 1994, 1869 U.N.T.S. 183, 33 I.L.M. 1167.
48. See n. 41, supra.
49. In Michigan 'A participating party... who knowingly enters its to a surrogate parentage contract for compensa tion is guilty of a misdemeanor and punishable by a fine of not more than $10,000 or imprisonment for not more than 1 year, or both.' Mich. Comp. Laws Ann § 722.859 (West 2008) cf. Illinois surrogacy law which allows the voluntary establishment of parent-child relationship in the context of gestational surrogacy and does not prohibit payment in the surrogacy contract. 750 Ill. Comp. Stat. Ann. 45/6 (West 2008).
50. If the US has in fact made any commitments to reduce barriers with respect to the trade implicated in interna tional surrogacy a party to the relevant WTO agreement would be able to challenge the US laws which hinder this trade. For example, a state law that criminalizes the contracting of gestational surrogacy services limits Indian service providers to only consumers from states that do not criminalize the practice. This limited access to the entire US market would thus be a barrier to that international trade.
51. See n. 41, supra.
52. Appellate Body Report, United States-Final Countervailing Duty Determination with Respect to Certain Softwood Lumber from Canada, 2004 WL 77819 (W.T.O.) GATT does provide some guidance as to the definition of goods in that it states that, 'The term "goods" is limited to products as understood in commercial practice, and is not intended to include the purchase or sale of services' GATT, Ad Article XVII, para. 2, Oct. 30, 1947, 61 Stat. A-11, 55 U.N.T.S. 194.
53. Black's Law Dictionary, 8th edn (2004), 714.
54. Jagdish Bhagwati, 'Economic Perspective on Trade in Professional Services', U.Chi.Leg. Forum 1 (1986): 45, 45-53.
55. Indeed some Indian surrogacy providers prefer that the clients and surrogates not meet. Gentleman, India, supra.
56. Animals have generally been found to constitute goods within the meaning of the Uniform Commercial Code. 67 American Jurisprudence Sales § 49 (2d ed. 2008)
57. Jean S Greek, What Will We Do If We Don't Experiment on Animals? (Trafford, 2004) 42-43 ('... mice and humans share about 97.5 percent of their working DNA- at most just two percent less than chimpanzees and humans...').
58. There are many so-called 'baby-selling statutes' which prohibit any exchange of valuable consideration for the adoption of a child. See, e.g., Minn. Stat. Ann. § 259.55.
59. If, however, a baby is not a 'good' how can it be bought and sold? See also Scott B. Rae, The Ethics of Commercial Surrogate Motherhood (Praeger, 1994), 29-38 (arguing that 'commercial surrogacy is indeed the sale of children...'. And pointing out that, 'Most surrogacy contracts are structured around the product, not the process or the service of surrogacy.')
60. 67 American Jurisprudence Sales § 50 (2d ed. 2008) ('most courts have held that transactions involving blood constitute the furnishing of a service and not the sale of goods'.); just a few of the statutes define blood and organ trans actions in terms of services: Va. Code Ann. § 2-108 (West 2008); Alaska Stat. Ann § 45.02.316 (West 2008); Ark. Code Ann. § 4-2-316 (West 2008).
61. Kerian, Surrogacy, supra at 154.
62. See Rae, The Ethics, supra (Praeger, 1994) at 31-38, 65
63. cf. Kerian, Surrogacy, supra at 154. (Arguing that, 'The fee paid to the surrogate is not to buy the child but rather to compensate the surrogate for her gestational services.')
64. 67 American Jurisprudence Sales § 38 (2d ed. 2008) ('To determine the main objective of a "mixed" or "hybrid" contract or transaction, courts look to whether the rendition of a service or the transaction of a sale of goods is the contract's... predominant purpose.') (internal citations omitted)
65. General Agreement on Trade in Services, 15 Apr. 1994, 1869 U.N.T.S. 183, 33 I.L.M. 1167.
66. General Agreement on Trade in Services, supra at Art. I, § 1.
67. General Agreement on Trade in Services, supra at Art,. XXVIII(a). ('[A]ny measure by a Member, whether in the form of a law, regulation, rule, procedure, decision, administrative action, or any other form.')
68. General Agreement on Trade in Services, supra at Art. XXVIII(c)(i).
69. U.S.-Gambling at ('The Appellate Body in EC - Bananas III indicated that the expression "measures... affecting trade in services" in Article I:1 is to be interpreted broadly. Further, the Appellate Body in that case upheld the indicates a broad scope of application. This interpretation is further reinforced by the conclusions of previous panels that the term "affect ing" in the context of Article III of the GATT is wider in scope than such terms as "regulating" or "governing".... We also note that Article I:3(b) of the GATS provides that "services" includes any service in any sector except services supplied in the exercise of governmental authority' (emphasis added), and that Art. XXVIII(b) of the GATS provides that the "supply of a service" includes the production, distribution, marketing, sale and delivery of a service'. There is nothing at all in these provisions to suggest a limited scope of application for the GATS.) In this case, laws prohibiting surrogacy certainly affects trade in the provision of the 'service' of surrogacy.
70. General Agreement on Trade in Services, supra at Art. I, § 3(a). This obligation is tempered by the proviso that, 'each Member shall take such reasonable measures as may be available to it to ensure their observance by regional and local governments and authorities and non-governmental bodies within its territory'. General Agreement on Trade in Services, supra at Art. I § 3(a) The US obligation under this proviso is discussed in more detail in Part III.
71. In addition, the AB has stated that 'There is no eason why measures adopted by regional and local governments and authorities cannot a priori "affect the supply of a service" within the meaning of Article I:1 of the GATS, even if such measures cannot be enforced extraterritorially.' U.S.-Gambling, supra at 196.
72. General Agreement on Trade in Services, supra at Art. I, § 2.
73. General Agreement on Trade in Services, supra at Art. II, § 1-3 (MFN); General Agreement on Trade in Ser vices, supra at Art. XVI, § 1 (market access); General Agreement on Trade in Services, supra at Art. XVII, § 1 (national treatment).
74. General Agreement on Trade in Services, supra at Art. XVI, § 1 (market access)
75. General Agreement on Trade in Services, supra at Art. XVII, § 1 (national treatment).
76. United States, Schedule of Specific Commitments, GATS/SC/90, 15 Apr. 1994 (US Schedule).
77. Regarding market access the US has committed to have no limitations on market access only for the first three modes of supply. US Schedule, supra at 49. For national treatment, the US has committed to no limitations in regard to all four modes of supply.
78. US Schedule, supra at 91 (9D).
79. See n. 2, supra.
80. Planet Hospital, Surrogate, (last visited 20 Apr. 2008).
81. With regard to 'tourism, other' the US has committed to have no limitations on market access for the first modes of supply only. In addition, it has committed to have no limitations on national treatment with regard to all four modes of supply. P 71.
82. WTO, Guide to Reading the GATS Schedule of Specific Commitments and the List of Article II (MFN) Exemptions, (last visited 20 Apr. 2008)
83. see also U.S.-Gambling, supra at 158. ('The Panel is of the view that, even if it is not binding, the CPC, through the context of W/120 and the Scheduling Guidelines, remains relevant for the interpretation of the U.S. Schedule.')
84. United Nations Statistics Division, Classifications Registry CPC,
85. U.S.-Gambling, supra.
86. U.S.-Gambling, supra at 145-169.
87. General Agreement on Trade in Services, supra at preamble.
88. General Agreement on Trade in Services, supra at Art. II, § 1. ('With respect to any measure covered by this Agreement, each Member shall accord immediately and unconditionally to services and service suppliers of any other Member treatment no less favourable than that it accords to like services and service suppliers of any other country.')
89. WTO Appellate Body Report, Canada - Certain Measures Affecting the Automotive Industry, WT/DS139/AB/R, WT/DS142/AB/R, para. 10.248 (adopted 19 Jun. 2000) According to the AB, 'to the extent that the service suppliers concerned supply the same services, they should be considered "like" for the purpose of this case'.
90. There is still a question, however, as to how the AB would analyze discriminatory treatment in the absence of any other like service providers from other Member countries.
91. EC-Bananas III, supra at paras 233-234.
92. Among other things a law could require particular financial resources of the clinic overseeing the surrogacy, a particular level of education for the surrogate (informed consent), or a particularly high level of health insurance.
93. In the GATT case of U.S.-Alcohol, infra, a national treatment violation was found based on different treatment by different US states.
94. Even if they could show that the US had not accorded them MFN treatment, the US could still justify its discriminatory treatment under one of the exceptions outlined in Art. XIV. The two most relevant to international sur rogacy are measures (a) necessary to protect public morals or to maintain public order; (b) necessary to protect human, animal or plant life or importance of interests or values that the challenged measure is intended to protect; (b) the extent to which the challenged measure contributes to the realization of the end pursued by that measure; and (c) the trade impact of the challenged measure. A test which at least some of the challenged gambling provisions could not survive. If it is found that the US has made a commitment on international surrogacy, any national legislation adopted by the US would have to conform to one of these exceptions.
95. 750 Ill. Comp. Stat. 45/6 (2008). More precisely, Illinois allows genetic parents to establish parentage before the birth of the child by the surrogate and does not prohibit payment in the formation of a valid surrogacy contract.
96. Wash. Rev. Code Ann. § 26.26.230 (West 2008) and Wash. Rev. Code Ann. § 26.26.240 (West 2008).
97. D.C. CODE §§ 16-401, 402. ('Surrogate parenting contracts are prohibited and rendered unenforceable in the District.'); Ind. Code § 31-20-1-1 (West 2008).
98. Fla. Stat. Ann. § 742.15(1) (West 2008). Florida also only allows payment for medical expenses relating to the surrogacy. Fla. Stat. Ann. § 742.15(4) (West 2008); Virginia allows surrogacy but limits it to 'a man and a woman, married to each other'. Va. Code Ann. § 20-156 (West 2008).
99. E.g., People ex rel. Dept. of Public Aid v. Smith, 818 N.E.2d 1204 (2004). (Construing language in Illinois statute above.)
100. See, e.g., J. F. v. D. B, 897 A.2d 1261 (Pa. Sup. Ct. 2004); A.H.W. v. G.H.B. 772 A.2d 948 (N.J. Sup. Ct. 200).
101. In EC - Bananas III, the Appellate Body confirmed that jurisprudence under the GATT 1994 could be rel evant for the interpretation of analogous provisions contained in the GATS. EC - Bananas III, supra at para. 231. Presum ably this should also be the case for jurisprudence under GATT 1947.
102. General Agreement on Trade in Services, supra at Art. I, § 3. ('In fulfilling its obligations and commitments under the Agreement, each Member shall take such reasonable measures as may be available to it to ensure their obser vance by regional and local governments and authorities and non-governmental bodies within its territory.')
103. GATT Panel Report, United States- Measures Affecting Alcoholic and Malt Beverages, DS23/R - 39S/206 (adopted 19 Jun. 1992) [hereinafter U.S.-Alcohol]; see also General Agreement on Trade and Tariffs, supra at Art. XXIV, § 12. This commitment was incorporated into GATT 1994 in the Understandings on the Interpretations of The GATT 1994, (last visited 20 Apr. 2008) ('Each Member is fully responsible under GATT 1994 for the observance of all provisions of GATT 1994, and shall take such reasonable mea sures as may be available to it to ensure such observance by regional and local governments and authorities within its territory.')
104. U.S.-Alcohol, supra at 79, para. 5.79.
105. General Agreement on Trade in Services, supra at Art. I, § 3.
106. WTO Panel Report, Canada- Import, Distribution and Sale of Certain Alcoholic Drinks by Provincial Marketing Agen cies, DS17/R - 39S/27 (adopted 18 Feb. 1992) [hereinafter Canada-Beer].
107. Canada-Beer, supra at 52, para. 5.36.
108. A final twist is the Uruguay Rounds Agreement Act, 19 U.S.C.A. § 3512. The URAA applies to US commit ments taken under GATS and provides 'No State law, or the application of such a State law, may be declared invalid as to any person or circumstance on the ground that the provision or application is inconsistent with any of the Uruguay Round Agreements, except WTO AB decisions can be considered by the court. E.g., in Allegheny Ludlum Corp. v. U.S., 367 F.3d 1339, 1348 (Fed. Cir. 2004). So even if there was an adverse ruling by the Panel or AB, it is unlikely that the WTO decision would enjoy much force in the US unless the US government itself decides to abide by it.
109. Although this case deals only with national treatment obligations, it is still relevant to an analysis of US obligations. As discussed above, GATS requirement for national treatment are in relation to the US Sched ule. While the US has made no specific commitments regarding international surrogacy in name, it may nevertheless be found to have made a commitment, in which case the jurisprudence regarding national treatment is directly relevant. In the case that MFN treatment is all that is required of the US, the discussions of national treatment are relevant in that the obligation undertaken is similar to that in MFN treatment.
110. In 2002, 12% of US women 15-44 (or 7.3 million women) had impaired fecundity, a physical difficulty with getting pregnant or carrying a baby to term. This represents an increase of about 2 percentage points from the levels seen in 1988 and 1995.' .