The Trail Smelter arbitration of 1938 and 1941 was a landmark decision about a dispute over environmental degradation between the United States and Canada. This was the first decision to recognize international liability for damages caused to another nation, even when no existing treaty created an obligation to prevent such damage.

A tribunal was set up by Canada and the United States to resolve a dispute over timber and crop damages caused by a smelter on the Canadian side of the border. The tribunal decided that Canada had to pay the United States for damages, and further that it was obliged to abate the pollution. In delivering their decision, the tribunal made an historic and often-cited declaration: "Under the principles of international law, as well as of the law of the United States, no State has the right to use or permit the use of its...