"Constitutionalization" and dispute settlement in the WTO: National security as an issue of competence

American Journal of International Law

Volumn 93, Issue 2, 1999, Pages 424-449

  Schloemann, Hannes L ^b   Ohlhoff, Stefan ^a  

^a WILMER CUTLER PICKERING HALE AND DORR LLP   (United States)

^b NONE

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[No Author keywords available]

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EID: 0347807660     PISSN: 00029300     EISSN: None     Source Type: Journal    
DOI: 10.2307/2997999     Document Type: Article

References (161)

1. We use this term with care. In describing the new WTO system, various writers, as do we talk about "jurisdiction," "legalism," "rule orientation," and the like. See, eg., Arie Reich, From Diplomacy to Law: The Juridicization of International, Trade Relations, 17 NW. J. INT'L L. & BUS. 775 (1996-97). While this is true, the phenomenon of constitutionalization we describe, or refer to, goes beyond the development of stricter rules and formalized third-party adjudication in international trade relations. The emergence of the WTO and the experience of the past four years, in particular the overwhelming acceptance and use of the dispute settlement mechanism, have pushed the multilateral trade system to develop into a proto-supranational structure. This structure, because of its central substantive area of application as much as its highly effective mechanisms, has been charged with more and more tasks and responsibilities beyond its original scope, both by political decisions (new separate agreements) and by external pressure (the popularity of the dispute settlement mechanism). Hence the problem of competence with respect to conflicting regimes, see infra note 2. The WTO, unlike the GATT 1947 and most other international regimes, is thus gradually being pushed into a stronger and more and more independent third-party role within the international community as a whole. This role displays elements of a new social contract, or "constitution." For an extensive overview of the constitutionalizadon of the world trading system and its possible impact on other international organizations, see ERNST- ULRICH PETERSMANN, THE GATT/WTO DISPUTE SETTLEMENT SYSTEM, esp. 44-65 (1996).
2. We use this term with care. In describing the new WTO system, various writers, as do we talk about "jurisdiction," "legalism," "rule orientation," and the like. See, eg., Arie Reich, From Diplomacy to Law: The Juridicization of International, Trade Relations, 17 NW. J. INT'L L. & BUS. 775 (1996-97). While this is true, the phenomenon of constitutionalization we describe, or refer to, goes beyond the development of stricter rules and formalized third-party adjudication in international trade relations. The emergence of the WTO and the experience of the past four years, in particular the overwhelming acceptance and use of the dispute settlement mechanism, have pushed the multilateral trade system to develop into a proto-supranational structure. This structure, because of its central substantive area of application as much as its highly effective mechanisms, has been charged with more and more tasks and responsibilities beyond its original scope, both by political decisions (new separate agreements) and by external pressure (the popularity of the dispute settlement mechanism). Hence the problem of competence with respect to conflicting regimes, see infra note 2. The WTO, unlike the GATT 1947 and most other international regimes, is thus gradually being pushed into a stronger and more and more independent third-party role within the international community as a whole. This role displays elements of a new social contract, or "constitution." For an extensive overview of the constitutionalizadon of the world trading system and its possible impact on other international organizations, see ERNST-ULRICH PETERSMANN, THE GATT/WTO DISPUTE SETTLEMENT SYSTEM, esp. 44-65 (1996).
3. We have treated the external limitations in some detail elsewhere. Stefan Ohlhoff & Hannes L. Schloemann, Rational Allocation of Disputes and "Constitutionalisation": Forum Choice as an Issue of Competence, in DISPUTE RESOLUTION IN THE WORLD TRADE ORGANISATION 302 (James Cameron & Karen Campbell eds., 1998). Taking disputes concerning trade-related environmental measures under multilateral agreements as an example, we argue that disputes touching on different legal regimes often raise questions not only regarding the applicable substantive law, but also regarding the competent forum, which makes forum shopping a particularly acute problem under WTO dispute settlement. We show that, in the absence of a clear compatibly clause, such disputes are to be allocated for settlement to the regime that, taken as whole, most nearly covers the primary subject matter of the dispute. The principles of lex specialis and lex posterior appear applicable only in the few cases where the primary subject matter does not indicate a clear choice. Furthermore, we argue that the competent forum may be forced to decline jurisdiction as a matter of judicial restraint resulting from the principle of good faith, e.g., if a party to the dispute tries to circumvent its obligations under one regime by appealing to the forum of the other. Applying these criteria, we identify the WTO as the forum that is competent to deal with most of the trade disputes touching on the subject matter of other regime. However, we argue that the WTO must not neglect its rapidly developing constitutional function by giving in to its trade bias, that is, by neglecting interests other than trade and their legal protection by other international regimes.
4. It is also endemic in antidumping law. The problem of judicial hierarchies might raise questions under public international law, such as whether the rule on exhaustion of local remedies should apply within the WTO regime, too. See Pieter Jan Kuyper, The Law of GATT as a Special Field of International Law. Ignorance, Further Refinement or Self-contained Regime of International Law? 25 NETH. Y.B. INT'L L. 227, 233-38 (1994); PETERSMANN, supra note 1, at 240-44. Petersmann also stresses other issues, such as whether national and international court procedures should be formally linked and whether they should apply the same standards of review, id. at 233-47.
5. It is also endemic in antidumping law. The problem of judicial hierarchies might raise questions under public international law, such as whether the rule on exhaustion of local remedies should apply within the WTO regime, too. See Pieter Jan Kuyper, The Law of GATT as a Special Field of International Law. Ignorance, Further Refinement or Self-contained Regime of International Law? 25 NETH. Y.B. INT'L L. 227, 233-38 (1994); PETERSMANN, supra note 1, at 240-44. Petersmann also stresses other issues, such as whether national and international court procedures should be formally linked and whether they should apply the same standards of review, id. at 233-47.
6. See European Communities - Regime for the Importation, Sale and Distribution of Bananas, WTO Doc. WT/DS27/R/USA (May 22, 1997) (panel report), WTO Doc. WT/DS27/AB/R (Sept. 9, 1997) (Appellate Body report); Case C-286/93, Atlanta v. Council, 4 EUROPÄISCHE ZEITSCHRIFT FÜR WIRTSCHAFTSRECHT [EUZW] 487 (1993) (Eur. Ct. Justice June 21 & July 6, 1993); Case C-280/93, FRG v. Council, 1994 ECR I-4973 (see also, in the same case, 4 EUZW at 483 (Order of June 29, 1993)); Case C-389/93, Anton Dürbeck GmbH v. Bundesant für Ernärung und Forstwirtschaft, 1995 ECR I-1509; Case C-466/93, Atlanta v. Bundesamt für Ernärung und Forstwirtschaft, 1995 ECR I-3799; Case C-469/93, Amministrazione delle Finanze dello Stato v. Chiquita Italia SpA, 1995 ECR I-4533; Case C-68/95, T. Port GmbH v. Bundesanstalt für Landwirtschaft und Ernährung, 1996 ECR I-6065. See also Case T-571/93, Lefebvre Frères et Soeurs v. Commission, 1995 ECR II-2379 (Ct. First Instance). For some of the German decisions, see, eg., Bundesfinanzhof, 7 EUROPÄISCHES WIRTSCHAFT- UND STEUERRECHT 49-51 (1996);
7. Verwaltungsgericht Frankfurt am Main, 8 EUZW 182-92 (1997).
8. On May 18, 1998, the United States and the European Union concluded an agreement aimed at removing threats to European companies under the Helms-Burton Act. See further text at note 34 infra. For the agreement see Guide to the EU-US. Summit (visited Mar. 1, 1999) 〈http://europa.eu.int/s97.vts〉. First, however, it is not clear whether Congress will agree to pass the amendments necessary to remove the basis for the European complaint. See FRANKFURTER ALLGEMEINE ZEITUNG, July 10, 1998, at 18. The President currently does not have the authority, grant the permanent waivers for EU nationals provided for in the EU-U.S. compromise. See e.g., Frank Montag, Economic Sanctions in an International Legal Context 23 (I.B.A. Conference, Vancouver, Sept. 17, 1998). Second the "separate peace" with the Community (and corresponding selective legislation) does nothing to relieve third countries, i.e., does not remove the possibility of further WTO involvement. Third, one does not have to be a prophet to predict that, irrespective of the Helms-Burton case, the WTO will have to face the basic question of jurisdiction sooner rather than later.
9. On May 18, 1998, the United States and the European Union concluded an agreement aimed at removing threats to European companies under the Helms-Burton Act. See further text at note 34 infra. For the agreement see Guide to the EU-US. Summit (visited Mar. 1, 1999) 〈http://europa.eu.int/s97.vts〉. First, however, it is not clear whether Congress will agree to pass the amendments necessary to remove the basis for the European complaint. See FRANKFURTER ALLGEMEINE ZEITUNG, July 10, 1998, at 18. The President currently does not have the authority, grant the permanent waivers for EU nationals provided for in the EU-U.S. compromise. See e.g., Frank Montag, Economic Sanctions in an International Legal Context 23 (I.B.A. Conference, Vancouver, Sept. 17, 1998). Second the "separate peace" with the Community (and corresponding selective legislation) does nothing to relieve third countries, i.e., does not remove the possibility of further WTO involvement. Third, one does not have to be a prophet to predict that, irrespective of the Helms-Burton case, the WTO will have to face the basic question of jurisdiction sooner rather than later.
10. On May 18, 1998, the United States and the European Union concluded an agreement aimed at removing threats to European companies under the Helms-Burton Act. See further text at note 34 infra. For the agreement see Guide to the EU-US. Summit (visited Mar. 1, 1999) 〈http://europa.eu.int/s97.vts〉. First, however, it is not clear whether Congress will agree to pass the amendments necessary to remove the basis for the European complaint. See FRANKFURTER ALLGEMEINE ZEITUNG, July 10, 1998, at 18. The President currently does not have the authority, grant the permanent waivers for EU nationals provided for in the EU-U.S. compromise. See e.g., Frank Montag, Economic Sanctions in an International Legal Context 23 (I.B.A. Conference, Vancouver, Sept. 17, 1998). Second the "separate peace" with the Community (and corresponding selective legislation) does nothing to relieve third countries, i.e., does not remove the possibility of further WTO involvement. Third, one does not have to be a prophet to predict that, irrespective of the Helms-Burton case, the WTO will have to face the basic question of jurisdiction sooner rather than later.
11. See Antonio F. Perez, To Judge Between the Nations: Post Cold War Transformations in National Security and Separation of Powers - Beating Nuclear Swords into Plowshares in an Imperfectly Competitive World, 20 HASTINGS INT'L & COMP. L. REV. 331, 408-10 (1997) (in briefly touching on this development, he refers to the evolving WTO as a "constitutionalization" of the GATT).
12. Or, where applicable, Article XIV bis of GATS or Article 73 of the TRIPS Agreement. For GATT 1994, the General Agreement on Trade in Services (GATS), and the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS), see FINAL ACT EMBODYING THE RESULTS OF THE URUGUAY ROUND OF MULTILATERAL TRADE NEGOTIATIONS, MARRAKESH, 15 APRIL 1994 (1994), reprinted in 33 ILM 1144, 1154, 1168, 1197 (1994) [hereinafter FINAL ACT]. Since the wording of all three provisions is identical, we refer below only to Article XXI of GATT 1994, which served as a model for the other exceptions.
13. See Werner Meng, Extraterritoriale Jurisdiktion in der US-amerikanischen Sanktionsgesetzgebung, 8 EuZW 423, 426 (1997).
14. As Knoll pointedly notes, "Permitting unilateral interpretation without recourse to multilateral overview . . . would allow the exception to emasculate the rules of a liberal trade order." David D. Knoll, The Impact of Security Concerns upon International Economic Law, 11 SYRACUSE J. INT'L L. & COM. 567, 587 (1984).
15. One may dispute the strict validity of the terminological dichotomy we use here. Arguably, both "interpretation" and "definition" in connection with application of a legal norm are acts of interpretation in a general sense. But, regardless of the terminology, the distinction made is crucial.
16. The position of the national security exception within GATT 1947 was examined, in particular, in an excellent and thorough study by Hahn, who touches on the jurisdictional question before us at various times. See Michael J. Hahn, Vital Interests and the Law of GATT: An Analysis of GATT's Security Exception, 12 Mich. J. INT'L L. 558 (1991). Drawing in part on his findings, we will summarize some of the arguments so as to focus on their further development in the new context since 1990, especially as regards the end of the Uruguay Round, the emergence of the WTO, and its drive toward constitutionalization.
17. See infra note 16; and John Spanogle, Jr., Can Helms-Burton Be Challenges under WTO? 27 STETSON L. REV. 1313 (1998) (with comprehensive further reference on the state of the discussion, id. at n.1) .
18. See infra note 16; and John Spanogle, Jr., Can Helms-Burton Be Challenges under WTO? 27 STETSON L. REV. 1313 (1998) (with comprehensive further reference on the state of the discussion, id. at n.1) .
19. See TIME, Mar. 11, 1996, at 36 (interview with President Castro).
20. Senator Jesse Helms (R., N.C.) and Congressman Dan Burton (R., Ill.).
21. See, e.g., Andreas F. Lowenfield, Congress and Cuba: The Helms-Burton Act, 90 AJIL 419 (1996); Brice M. Clagett, Title III of the Helms-Burton Act Is Consistent with International Law, id. at 434; Brice M. Clagett, A Reply to Professor Lowenfield, id. at 641; and the International Symposium on the Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996, 30 GEO. WASH. J. INT'L L. & ECON. 201 (1996-97).
22. See, e.g., Andreas F. Lowenfield, Congress and Cuba: The Helms-Burton Act, 90 AJIL 419 (1996); Brice M. Clagett, Title III of the Helms-Burton Act Is Consistent with International Law, id. at 434; Brice M. Clagett, A Reply to Professor Lowenfield, id. at 641; and the International Symposium on the Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996, 30 GEO. WASH. J. INT'L L. & ECON. 201 (1996-97).
23. See, e.g., Andreas F. Lowenfield, Congress and Cuba: The Helms-Burton Act, 90 AJIL 419 (1996); Brice M. Clagett, Title III of the Helms-Burton Act Is Consistent with International Law, id. at 434; Brice M. Clagett, A Reply to Professor Lowenfield, id. at 641; and the International Symposium on the Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996, 30 GEO. WASH. J. INT'L L. & ECON. 201 (1996-97).
24. See, e.g., Andreas F. Lowenfield, Congress and Cuba: The Helms-Burton Act, 90 AJIL 419 (1996); Brice M. Clagett, Title III of the Helms-Burton Act Is Consistent with International Law, id. at 434; Brice M. Clagett, A Reply to Professor Lowenfield, id. at 641; and the International Symposium on the Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996, 30 GEO. WASH. J. INT'L L. & ECON. 201 (1996-97).
25. Provided that the court's personal jurisdiction over the defendant is established. The Act itself, it is important to note, does not change the statutory, common law, and constitutional due process requirements that must be met to obtain personal jurisdiction. However, this does little to reduce the threat to foreign individuals and companies (although it arguably leaves some room for circumvention of the Act's consequences in case of dire need), as it does not take much to fall under U.S. personal jurisdiction. Anyone doing business in America could be caught. And most European companies that are big enough to make serious investments in Cuba have some economic dealings with, thus often in, the United States, which could lead to general jurisdiction over that company, provided a certain level of activity is reached within the forum state. True, if corresponding efforts are made, large corporations can often avoid U.S. jurisdiction by outsourcing their Cuban activities or the like. But this option does not significantly change the picture. Defending the Act by pointing to the possibility of circumventing it through elaborate structural adjustments is odd and contributes little to the point. It does not explain why foreigners, even if naive enough not to resort to corporate tricks, should find themselves threatened by title III in the first place. The extraterritorial effect is perceived as real, as the U.S. trading partners' reactions demonstrate. That corresponds with the drafters' stated purposes. The House report on the bill states: "The purpose of this new civil remedy is, in part, to discourage persons and companies from engaging in commercial transactions involving confiscated property, and in so doing to deny the Cuban regime the capital generated by such ventures and deter the exploitation of property confiscated from U.S. nationals." H.R. REP. No. 104-202, 104th Cong., pt. 1, at 39 (1995). The involved questions of extraterritoriality and compatibility with general international law have received ample attention See, e.g., Kathleen Adams, Subchapter III of the Helms Burton Act: A Reasonable Assertion of United States Extraterritorial Jurisdiction? 21 HAMLINE L. REV. 147 (1997); Robert Muse, A Public International Law Critique of the Extraterritorial Jurisdiction of the Helms-Burton Act (Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996), 30 GEO. WASH. J. INT'L L. & ECON. 207 (1996-97). But neither these nor the more specific questions of the Act's substantive compatibility with WTO law are our subject here.
26. Provided that the court's personal jurisdiction over the defendant is established. The Act itself, it is important to note, does not change the statutory, common law, and constitutional due process requirements that must be met to obtain personal jurisdiction. However, this does little to reduce the threat to foreign individuals and companies (although it arguably leaves some room for circumvention of the Act's consequences in case of dire need), as it does not take much to fall under U.S. personal jurisdiction. Anyone doing business in America could be caught. And most European companies that are big enough to make serious investments in Cuba have some economic dealings with, thus often in, the United States, which could lead to general jurisdiction over that company, provided a certain level of activity is reached within the forum state. True, if corresponding efforts are made, large corporations can often avoid U.S. jurisdiction by outsourcing their Cuban activities or the like. But this option does not significantly change the picture. Defending the Act by pointing to the possibility of circumventing it through elaborate structural adjustments is odd and contributes little to the point. It does not explain why foreigners, even if naive enough not to resort to corporate tricks, should find themselves threatened by title III in the first place. The extraterritorial effect is perceived as real, as the U.S. trading partners' reactions demonstrate. That corresponds with the drafters' stated purposes. The House report on the bill states: "The purpose of this new civil remedy is, in part, to discourage persons and companies from engaging in commercial transactions involving confiscated property, and in so doing to deny the Cuban regime the capital generated by such ventures and deter the exploitation of property confiscated from U.S. nationals." H.R. REP. No. 104-202, 104th Cong., pt. 1, at 39 (1995). The involved questions of extraterritoriality and compatibility with general international law have received ample attention See, e.g., Kathleen Adams, Subchapter III of the Helms Burton Act: A Reasonable Assertion of United States Extraterritorial Jurisdiction? 21 HAMLINE L. REV. 147 (1997); Robert Muse, A Public International Law Critique of the Extraterritorial Jurisdiction of the Helms-Burton Act (Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996), 30 GEO. WASH. J. INT'L L. & ECON. 207 (1996-97). But neither these nor the more specific questions of the Act's substantive compatibility with WTO law are our subject here.
27. Provided that the court's personal jurisdiction over the defendant is established. The Act itself, it is important to note, does not change the statutory, common law, and constitutional due process requirements that must be met to obtain personal jurisdiction. However, this does little to reduce the threat to foreign individuals and companies (although it arguably leaves some room for circumvention of the Act's consequences in case of dire need), as it does not take much to fall under U.S. personal jurisdiction. Anyone doing business in America could be caught. And most European companies that are big enough to make serious investments in Cuba have some economic dealings with, thus often in, the United States, which could lead to general jurisdiction over that company, provided a certain level of activity is reached within the forum state. True, if corresponding efforts are made, large corporations can often avoid U.S. jurisdiction by outsourcing their Cuban activities or the like. But this option does not significantly change the picture. Defending the Act by pointing to the possibility of circumventing it through elaborate structural adjustments is odd and contributes little to the point. It does not explain why foreigners, even if naive enough not to resort to corporate tricks, should find themselves threatened by title III in the first place. The extraterritorial effect is perceived as real, as the U.S. trading partners' reactions demonstrate. That corresponds with the drafters' stated purposes. The House report on the bill states: "The purpose of this new civil remedy is, in part, to discourage persons and companies from engaging in commercial transactions involving confiscated property, and in so doing to deny the Cuban regime the capital generated by such ventures and deter the exploitation of property confiscated from U.S. nationals." H.R. REP. No. 104-202, 104th Cong., pt. 1, at 39 (1995). The involved questions of extraterritoriality and compatibility with general international law have received ample attention See, e.g., Kathleen Adams, Subchapter III of the Helms Burton Act: A Reasonable Assertion of United States Extraterritorial Jurisdiction? 21 HAMLINE L. REV. 147 (1997); Robert Muse, A Public International Law Critique of the Extraterritorial Jurisdiction of the Helms-Burton Act (Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996), 30 GEO. WASH. J. INT'L L. & ECON. 207 (1996-97). But neither these nor the more specific questions of the Act's substantive compatibility with WTO law are our subject here.
28. Act, supra note 5, §302(a); see, in particular, subsection (a) (3) (C).
29. Act, supra note 5, §302(a) (3) (C).
30. Id., §4(13) defines "trafficking" as follows: a person "traffics" in confiscated property if that person knowingly and intentionally - (i) sells, transfers, distributes, dispenses, brokers, manages, or otherwise disposes of confiscated property, or purchases, leases, receives, possesses, obtains control of, manages, uses, or otherwise acquires or holds an interest in confiscated property, (ii) engages in a commercial activity using or otherwise benefiting from confiscated property, or (iii) causes, directs, participates in, or profits from, trafficking (as described in clause (i) or (ii)) by another person, or otherwise engages in trafficking (as described in clause (i) or (ii)) through another person. It remains to be seen whether courts will sanction the extensive application suggested by the text, in particular subparagraph (iii).
31. This terminology, including explicit reference to the Arab boycott against those dealing with Israel, was used e.g., by Lowenfeld, supra note 16, at 429; see also Joseph V. Walker, The Legality of the Secondary Boycotts Contained in the Helms-Burton Act under International Law, 3 DEPAUL DIG. INT'L L. 1, 2-4 (1997) (with an overview of the usually contrasting U.S. foreign and domestic policy concerning secondary boycotts). Of course, the Helms-Burton approach is somewhat different from the Arab boycott: the latter purports to prohibit certain transactions between private persons subject to the respective Arab country's jurisdiction and foreign persons that also do business with Israel, whereas title III of Helms-Burton provides a right of action for U.S. entities to target third parties on the basis of their dealings with Cuba. Nonetheless, the stated purpose, see supra note 17, and effective result of title III (and title IV) are to confront third parties with the choice of trading with Cuba or the United States, but not both. That is precisely what the Arab, and any other, secondary boycott does. This is not to suggest that the motivations and possible justifications for the boycotts may not be of very different moral and/or legal weight. Still, those who defend Helms-Burton on the basis of the alleged illegality of Cuban nationalizations without compensation under international law may bear in mind that the justifications for the Arab boycott - that Israel had taken Arab land contrary to international law, etc. - were not all that different in structure. Cuba itself argues that it did offer the United States compensation at the time, in the form of payments based on sugar exports, but that the offer was effectively rejected by the U.S. blockade. United States - Cuban Liberty and Democratic Solidarity Act of 1996, Communication from Cuba, Mar. 19, 1996, WTO Doc. WT/L/142, at 2 (Apr. 4, 1996).
32. Act, supra note 5, §401. So far the U.S. administration has applied title IV in a very limited way, invoking it in only a few instances. However, panels have consistently held that the actual application of a restrictive trade measure and its impact on trade flows between parties to GATT 1947/WTO members are irrelevant, in principle, to its assessment under GATT/WTO rules The basic rules of the trading system on restrictive trade measures, namely, Articles III and XI of GATT 1947/1994 and Article VI, XVI and XVII of GATS, establish certain competitive conditions for trade between WTO members. Not only are these conditions distorted by the actual application of a measure. Nullification or impairment of the benefits accruing to WTO members from the establishment of a certain competitive relationship between them also results from the mere threat of restrictive measures, etc., because it leads to increased transaction costs and creates uncertainties that could affect investment plans. Thus, the provisions on restrictive trade measures are designed both to protect actual trade flows to create the predictability needed to plan future trade. The panel report, United States - Taxes on Petroleum and Certain Imported Substances, June 17, 1987, GATT B.I.S.D. (34th Supp.) at 136, para. 5.2.2 (1998), therefore pointed out that "that objective could not be attained if contracting parties could not challenge existing legislations mandating actions at variance with the General Agreement until the administrative acts implementing it had actually been applied to their trade." See also the working party report, Brazilian Internal Taxes, June 30, 1949, 2 B.I.S.D. 181, para. 16 (1952); Japanese Measures on Imports of Leather, May 14-15, 1984, id (31st Supp.) at 94, para. 55 (1985); EEC - Payments and Subsidies to Processors and Producers of Oil-Seeds and Related Animal-Feed Proteins, Jan. 25, 1990, id. (37th Supp.) at 86, para. 150 (1991); United States - Measures Affecting Alcohol and Malt Beverages, June 19, 1992, id. (39th Supp.) at 206, para. 5.6, 5.65 (1993 ).
33. Act, supra note 5, §401. So far the U.S. administration has applied title IV in a very limited way, invoking it in only a few instances. However, panels have consistently held that the actual application of a restrictive trade measure and its impact on trade flows between parties to GATT 1947/WTO members are irrelevant, in principle, to its assessment under GATT/WTO rules The basic rules of the trading system on restrictive trade measures, namely, Articles III and XI of GATT 1947/1994 and Article VI, XVI and XVII of GATS, establish certain competitive conditions for trade between WTO members. Not only are these conditions distorted by the actual application of a measure. Nullification or impairment of the benefits accruing to WTO members from the establishment of a certain competitive relationship between them also results from the mere threat of restrictive measures, etc., because it leads to increased transaction costs and creates uncertainties that could affect investment plans. Thus, the provisions on restrictive trade measures are designed both to protect actual trade flows to create the predictability needed to plan future trade. The panel report, United States - Taxes on Petroleum and Certain Imported Substances, June 17, 1987, GATT B.I.S.D. (34th Supp.) at 136, para. 5.2.2 (1998), therefore pointed out that "that objective could not be attained if contracting parties could not challenge existing legislations mandating actions at variance with the General Agreement until the administrative acts implementing it had actually been applied to their trade." See also the working party report, Brazilian Internal Taxes, June 30, 1949, 2 B.I.S.D. 181, para. 16 (1952); Japanese Measures on Imports of Leather, May 14-15, 1984, id (31st Supp.) at 94, para. 55 (1985); EEC - Payments and Subsidies to Processors and Producers of Oil-Seeds and Related Animal-Feed Proteins, Jan. 25, 1990, id. (37th Supp.) at 86, para. 150 (1991); United States - Measures Affecting Alcohol and Malt Beverages, June 19, 1992, id. (39th Supp.) at 206, para. 5.6, 5.65 (1993 ).
34. Act, supra note 5, §401. So far the U.S. administration has applied title IV in a very limited way, invoking it in only a few instances. However, panels have consistently held that the actual application of a restrictive trade measure and its impact on trade flows between parties to GATT 1947/WTO members are irrelevant, in principle, to its assessment under GATT/WTO rules The basic rules of the trading system on restrictive trade measures, namely, Articles III and XI of GATT 1947/1994 and Article VI, XVI and XVII of GATS, establish certain competitive conditions for trade between WTO members. Not only are these conditions distorted by the actual application of a measure. Nullification or impairment of the benefits accruing to WTO members from the establishment of a certain competitive relationship between them also results from the mere threat of restrictive measures, etc., because it leads to increased transaction costs and creates uncertainties that could affect investment plans. Thus, the provisions on restrictive trade measures are designed both to protect actual trade flows to create the predictability needed to plan future trade. The panel report, United States - Taxes on Petroleum and Certain Imported Substances, June 17, 1987, GATT B.I.S.D. (34th Supp.) at 136, para. 5.2.2 (1998), therefore pointed out that "that objective could not be attained if contracting parties could not challenge existing legislations mandating actions at variance with the General Agreement until the administrative acts implementing it had actually been applied to their trade." See also the working party report, Brazilian Internal Taxes, June 30, 1949, 2 B.I.S.D. 181, para. 16 (1952); Japanese Measures on Imports of Leather, May 14-15, 1984, id (31st Supp.) at 94, para. 55 (1985); EEC - Payments and Subsidies to Processors and Producers of Oil-Seeds and Related Animal-Feed Proteins, Jan. 25, 1990, id. (37th Supp.) at 86, para. 150 (1991); United States - Measures Affecting Alcohol and Malt Beverages, June 19, 1992, id. (39th Supp.) at 206, para. 5.6, 5.65 (1993 ).
35. Act, supra note 5, §401. So far the U.S. administration has applied title IV in a very limited way, invoking it in only a few instances. However, panels have consistently held that the actual application of a restrictive trade measure and its impact on trade flows between parties to GATT 1947/WTO members are irrelevant, in principle, to its assessment under GATT/WTO rules The basic rules of the trading system on restrictive trade measures, namely, Articles III and XI of GATT 1947/1994 and Article VI, XVI and XVII of GATS, establish certain competitive conditions for trade between WTO members. Not only are these conditions distorted by the actual application of a measure. Nullification or impairment of the benefits accruing to WTO members from the establishment of a certain competitive relationship between them also results from the mere threat of restrictive measures, etc., because it leads to increased transaction costs and creates uncertainties that could affect investment plans. Thus, the provisions on restrictive trade measures are designed both to protect actual trade flows to create the predictability needed to plan future trade. The panel report, United States - Taxes on Petroleum and Certain Imported Substances, June 17, 1987, GATT B.I.S.D. (34th Supp.) at 136, para. 5.2.2 (1998), therefore pointed out that "that objective could not be attained if contracting parties could not challenge existing legislations mandating actions at variance with the General Agreement until the administrative acts implementing it had actually been applied to their trade." See also the working party report, Brazilian Internal Taxes, June 30, 1949, 2 B.I.S.D. 181, para. 16 (1952); Japanese Measures on Imports of Leather, May 14-15, 1984, id (31st Supp.) at 94, para. 55 (1985); EEC - Payments and Subsidies to Processors and Producers of Oil-Seeds and Related Animal-Feed Proteins, Jan. 25, 1990, id. (37th Supp.) at 86, para. 150 (1991); United States - Measures Affecting Alcohol and Malt Beverages, June 19, 1992, id. (39th Supp.) at 206, para. 5.6, 5.65 (1993 ).
36. Act, supra note 5, §110(c).
37. Id. §110(a) (2). This provision may effectively prohibit a vessel from entering a U.S. port because it is carrying goods that fall under the provision, even though the vessel intends to unload only goods that do not.
38. Id. §110(a) (3).
39. See Canada, Foreign Extraterretorial Measures Act (FEMA), R.S.C., ch. F-29 (1985), as amended Oct. 9, 1996, 1996 S.C., ch. 28, reprinted in 36 ILM 111 (1997) (esp. secs. 5, authorization of Attorney General to prohibit compliance; 7-9, claw-back); European Community, Council Regulation 2271/96 Protecting against the Effects of the Extra-territonal Application of Legislation Adopted by a Third Country (Nov. 22, 1996), 1996 O.J. (L 309) 1, reprinted in 36 ILM at 125 (esp. Arts. 5, prohibition of compliance; 6, claw-back; note that under Article 5, paragraph 2, exceptional authorization to comply with Helms-burton may be granted where noncompliance would seriously damage the interest of the affected persons or of the Community); Mexico, Act to Protect Trade and Investment From Foreign Norms That Contravene International Law (Oct. 23, 1996), D.O., Oct. 23, 1996, at 9, translated in 36 ILM at 133 (esp. Arts. 3-5).
40. OAS Doc. CJI/SO/II/doc.67/96 rev.5 (Aug. 23, 1996), reprinted in 35 ILM 1329 (1996).
41. See id., esp. paras. 6, 8, 35 ILM at 1332, 1333.
42. For a brief account, see Brigitte Stern, Vers la Mondialisation juridique? Les lois Helms-Burton et Kennedy-D'Amato, 100 REVUE GÉNÉRALE DE DROIT INTERNATIONAL PUBLIC 979, 990 (1996).
43. See WTO Doc. WT/DS38/2 & Corr. (1996).
44. See WTO Doc WT/DS38/2, supra note 30. On the present state of the dispute, see Overview of the State of Play of WTO Disputes (visited Mar. 13, 1999) 〈http://www.wto.org/wto/dispute/bulletin.htm〉.
45. Memorandum of Understanding concerning the U.S. Helms-Burton Act and the U.S. Iran and Libya Sanctions Act, Apr. 11, 1997, EU-U.S., reprinted in 36 ILM 529 (1997), 91 AJIL 498 (1997). The Memorandum of Understanding also covered the parallel dispute over the Iran and Libya Sanctions Act of 1996. The possible international legal implications have not (yet) reached the WTO, and it is unclear whether they will. For the purpose of this study, we will confine ourselves to the dispute over Helms-Burton.
46. See Overview of the State of Play of WTO Disputes, supra note 31.
47. See note 6 supra; see also Stefaan Smis & Kim Van der Borght, The EU-U.S. Compromise, on the Helms-Burton and D'Amato Acts, 93 AJIL 227, 231-36 (1999).
48. See DSU, infra note 87, Art. 3(2); and Vienna Convention on the Law of Treaties, May 23, 1969, Arts. 31-33, 1155 UNTS 331.
49. GATT 1994, supra note 8, Art. XXI.
50. The potentiality difficult questions relating to UN-ordered economic sanctions would include the competence a GATT panel could have where a state relies on UN measures, while its opponent doubts the compatibility of those measures with the UN Security Council orders they are meant to serve. A WTO panel would be competent if the question were whether and to what extent GATT obligations were disregarded prima facie. The criteria we have developed elsewhere, see supra note 2, with respect to dispute settlement mechanisms of competing international legal regimes would apply here and provide guidance. In this case the "primary subject matter" criterion would probably lead to a rather clear allocation of competence at the United Nations (especially of the Security Council and/or the International Court of Justice) regarding UN obligations and the conformity of the measures taken with them.
51. While the rules of interpretation applicable to GATT 1947 have never been a clear, Article 3.2 of the DSU, infra note 87, now requires that panels and the Appellate Body "clarify" the WTO Agreements, including GATT 1994 and GATS, "in accordance with customary rules of interpretation of public international law." The Appellate Body, in United States - Standards for Reformulated and Conventional Gasoline, May 20, 1996, WTO Doc. WT/DS2/AB/R, at 16-17, 20, 23, reprinted in 35 ILM 603 (1996) [hereinafter U.S. Gasoline], and Japan - Taxes on Alcoholic Beverages, Nov. 1, 1996, WTO Doc. WT/DS8, 10, 11/AB/R, at 10-15 [hereinafter Japan Alcohol], pointed out that this requirements refers, first of all, to Articles 31 and 32 of the Vienna Convention on the Law of Treaties, supra note 35. In interpreting GATT 1994, GATS and other WTO Agreements, the Appellate Body therefore held that "the words of the treaty form the foundation for the interpretive process. . . . The provisions of the treaty are to be given their ordinary meaning in their context. The object and purpose of the treaty are also to be taken into account in determining the meaning of its provisions." Japan Alcohol, supra, at 11-12 (citations omitted). In this respect, the Appellate Body stressed the importance of the principle of effectiveness in interpreting the WTO Agreements, id. at 12-13. "[I]nterpretation must give meaning and effect to all the terms of treaty." U.S. Gasoline, supra, at 23. Regarding previous panel decisions under GATT 1947 and GATT 1994, as well as its own, the Appellate Body, in Japan Alcohol, supra, at 13-15, correctly took the view that such decisions do not constitute "subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation" in the sense of Article 31(3) (b) of the 1969 Vienna Convention. However, "[adopted panel reports are an important part of the GATT acquis. They are often considered by subsequent panels. They create legitimate expectations among WTO Members, and, therefore, should be taken into account where they are relevant to any dispute. Furthermore, the Appellate Body stated that "a panel could. . . find useful guidance in the reasoning of an unadopted panel report that it considered to be relevant," id. at 15 (emphasis added). Hence, we consider it useful to analyze past panel practice regarding Article XXI of GATT 1947 before engaging in "classic" treaty interpretation.
52. The distinction among cases made here is arguably somewhat arbitrary. It is meant to serve the sole purpose of illuminating the specific jurisdictional question before us.
53. UK Representative Shackle at the CONTRACTING PARTIES' final meeting on the dispute, Doc. GATT/CP.3/SR.22, at 7 (1949).
54. Doc. GATT/CP.3/SR.22, supra note 40, at 8-9.
55. The decision of June 8, 1949, 2 GATT B.I.S.D. 28 (1952), was taken after a brief discussion, without prior reference to a working party. Like all such decisions in the early GATT days, it was not accompanied by official reasons. The delegates' statements during the discussion thus provide the only, very limited indication of the underlying reasons and motivations.
56. Bhala takes this decision, together with the 1982 decision in the Falkland/Malvinas context, see text at note 80 infra, as sufficient precedent for the conclusion that formal GATT/WTO jurisdiction under Article XXIII for matters involving Article XXI cannot be questioned. Raj Bhala, National Security and International Trade Law: What the GATT Says, and What the United states Does, 19 U. PA. J. INT'L ECON. L. 263, 278, 279 (1998). However, we believe that the significance of the mere fact of this decision to the question of jurisdiction is limited. At that time the plenum of the CONTRACTING PARTIES conceived of itself in only a rudimentary way as a judicial or (in any strict sense) law-applying body under Article XXIII of GATT 1947. Even the later, and arguably still more diplomatic than judicial, GATT 1947 panel system was barely on the horizon in the form of the emergent working parties See ROBERT E. HUDEC, THE GATT LEGAL SYSTEM AND WORLD TRADE DIPLOMACY 75-83 (2d ed. 1990). That the rejection of the Czechoslovak complaint was seen as a (positive) assumption of "jurisdiction" regarding Article XXI in any technical sense therefore seems debatable. Moreover, some of the votes, as the statement by the Pakistani representative reveals, were apparently based on the alleged lack of substantiation of the Czechoslovak complaint, i.e., on purely procedural grounds, thus avoiding the jurisdictional question regarding Article XXI altogether. See the discussion in Doc. GATT/CP.3/SR.22, supra note 40.
57. Bhala takes this decision, together with the 1982 decision in the Falkland/Malvinas context, see text at note 80 infra, as sufficient precedent for the conclusion that formal GATT/WTO jurisdiction under Article XXIII for matters involving Article XXI cannot be questioned. Raj Bhala, National Security and International Trade Law: What the GATT Says, and What the United states Does, 19 U. PA. J. INT'L ECON. L. 263, 278, 279 (1998). However, we believe that the significance of the mere fact of this decision to the question of jurisdiction is limited. At that time the plenum of the CONTRACTING PARTIES conceived of itself in only a rudimentary way as a judicial or (in any strict sense) law-applying body under Article XXIII of GATT 1947. Even the later, and arguably still more diplomatic than judicial, GATT 1947 panel system was barely on the horizon in the form of the emergent working parties See ROBERT E. HUDEC, THE GATT LEGAL SYSTEM AND WORLD TRADE DIPLOMACY 75-83 (2d ed. 1990). That the rejection of the Czechoslovak complaint was seen as a (positive) assumption of "jurisdiction" regarding Article XXI in any technical sense therefore seems debatable. Moreover, some of the votes, as the statement by the Pakistani representative reveals, were apparently based on the alleged lack of substantiation of the Czechoslovak complaint, i.e., on purely procedural grounds, thus avoiding the jurisdictional question regarding Article XXI altogether. See the discussion in Doc. GATT/CP.3/SR.22, supra note 40.
58. See Doc. GATT/CP.3/SR.22, supra note 40.
59. Hahn, supra note 12, at 570.
60. In vain did the Czechoslovak delegate point to his recollection of the understanding at the Havana Conference two years earlier that Article XXI was to be interpreted narrowly. See his initial statement in Doc. GATT/CP.3/39 (1949). He tried to draw the CONTRACTING PARTIES' attention to the terms of Article XXI (b) (ii) ("war material"), but succeeded only in provoking a rejection by the defendant United States, see text at note 52 infra, while the other contracting parties apparently took no part in the substantive discussion.
61. See Hahn, supra note 12, at 570.
62. As HUDEC, supra note 43, at 77, points out: "although the Czech complaint was not frivolous, the infant GATT had neither the capacity nor the prestige to undertake a serious examination of U.S. cold war measures." Note again the statement of the Pakistani delegate, supra note 43.
63. HUDEC, supra note 43, at 77.
64. UK delegate Shackle, Doc. GATT/CP.3/SR.22, supra note 40, at 7.
65. Teleological in that it has the limited, or focused trade purpose of the infant GATT in mind; systematic/contextual in that it is based on the structure of the GATT as a system.
66. See Reply by the Vice Chairman of the U.S. Delegation, Mr. John W. Evans, to the Speech by the Head of the Czechoslovak Delegation under Item 14 on the Agenda, Doc. GATT/CP.3/38, at 11 (1949).
67. Statement of Mr. Evans, Doc. GATT/CP.3/SR.22, supra note 40, at 7-8.
68. Arguably, this interpretation of the U.S. argument is somewhat broad in view of the limited legal "density" of the discussion. Nonetheless, the contrast to Nicaragua I, see text at notes 55-56 infra, remains: there, the United States refused even to discuss Article XXI. Here, it let itself be dragged, a few steps at least, into a discussion over the requirements of Article XXI(b).
69. United States - Imports of Sugar from Nicarragua, Mar. 13, 1984, GATT B.I.S.D. (31st Supp.) at 67, 72, para. 3.10 (1985). The United States refused to offer any defense. It neither argued against the allegation of having disregarded obligations under Article XIII of GATT 1947 nor invoked Article XXI, but generally stated that its action was "fully justified in the context in which it was taken." Id. at 72, para. 3.11. Only with regard to the alleged violation of Article XI (General Elimination of Quantitative Restrictions) did the United States, while again maintaining that it did not intend to respond to Nicaragua's arguments, state its general position that the U.S. quota system was consistent with GATT. See id. at 73, para. 3.12.
70. See id., paras. 4.4, 4.5. Since Article XXI was excluded because it had not been invoked, the panel's reasoning accorded with the normal practice with regard to the Article XIII obligation of "nondiscriminatory administration of quantitative restrictions": that the reduction in the sugar quota was not warranted by corresponding market changes in the preceding years, see Art. XIII(2). With regard to Article XXI, the panel found that the question did not fall within its terms of reference.
71. See Executive Order No. 12,513, May 1, 1985, 50 Fed. Reg. 18,629 (May 2, 1985).
72. Id.
73. Owing to Nicaragua's opposition, the panel report was never adopted. The United States lifted its embargo in 1990 after the Sandinistas lost power at the polls.
74. GATT Doc. C/M/196, at 7 (1986).
75. The documented parts of the discussion leading to the understanding, see GATT Docs. C/M/191, C/M/192, C/M/196 (1986), are arguably inconclusive on this question. While most countries both supported Nicaragua's right (originally contested by the United States) to have a panel established and did not see any reason to exclude the Article XXI justification from its review, a few members notably Canada and the European Community, agreed in principle with the U.S. position that the political question should not be subjected to panel scrutiny. The discussions, similarly to those in the U.S.-Czechoslovak case discussed above, primarily reflect a certain anxiousness to avoid disruptive confrontation within GATT as much as possible. See, e.g., the statement of the representative of Japan who, while recognizing that the matter was "essentially political," supported Nicaragua in principle regarding the right to request panel review; nevertheless, "from a practical point of view, Japan doubted whether this would be an efficient means of finding a solution in the present case." GATT Doc. C/M/191, supra, at 43. It is difficult, if not problematic, to extract legal conclusions from those primarily diplomatic statements, as with most CONTRACTING PARTIES' discussions under the old GATT 1947. Nonetheless, it seems safe to conclude that the decision on the terms of reference did not reflect a consensus that a panel would automatically be barred from reviewing invocations of Article XXI but represented the lowest common denominator, or the conditions under which the United States would agree to the establishment of a panel. Because a consensus was necessary under GATT 1947, the United States blocked that consensus until it got its way. Thus, this consensus did not constitute a common position or interpretation of GATT but an ad hoc agreed-upon limitation of review. Significantly, the U.S. strategy in this case is no longer possible under the WTO DSU, which does not require the consent of the defendant party for the establishment of a panel (DSU Art. 6(1)) and provides for all-inclusive standard terms of reference (DSU Art. 7), which apply if the parties do not agree otherwise. This shift from power (or diplomacy)
76. Note, however, that during the proceeding, the United States tried to avoid any such conclusion by maintaining that the panel was barred from examining the invocation of Article XXI(b)(iii) both by the "clear terms" of that provision and by the terms of reference. United States - Trade Measures Affecting Nicaragua, Oct. 13 1986 (unadopted), GATT Doc. L/6053, para. 4.6 (restricted). The panel refused to provide assistance by stretching the interpretation of the restriction in the terms of reference to the other extreme: The panel did not consider the question of whether the terms of Article XXI precluded it from examining the validity of the United States' invocation of that Article as this examination was precluded by its mandate. Id., para. 5.3.
77. Id., paras. 5.2, 5.3 (containing quote in text); see also Hahn, supra note 12, at 609.
78. Id., para. 5.17.
79. See Rudolf Bernhardt, Interpretation in International Law, in [Instalment] 7 ENCYCLOPEDIA OF PUBLIC INTERNATIONAL LAW 318 (Rudolf Bernhardt ed., 1984).
80. See Hahn, supra note 12, at 577.
81. See the EC statement in the Council discussions on the EC measures against Argentina GATT Doc. L/5319/Rev 1 (1982) quoted in GATT, ANALYTICAL INDEX: GUIDE TO GATT LAW AND PRACTICE 603 n.25 (6th rev. ed. 1995).
82. See U.S. Gasoline, supra note 38, at 17: "That direction [i.e., DSU Art. 3(2)] reflects a measure of recognition that the General Agreement is not to be read in clinical isolation from public international law.
83. It was among others, this very GATT panel which expressed this (old) view: replying to Nicaragua's reference to principles of general international law, it stated, "without refuting such argumentation, that its terms of reference - "to examine [the measures] in the light of the relevant GATT provisions" - prevented it from taking non-GATT legal rules into account. United States - Trade Measures Affecting Nicaragua, supra note 62, para. 5.15. See Hahn, supra note 12, at 610 for further references.
84. GATT Doc. L/6948 (1991), quoted in GATT, ANALYTICAL INDEX, supra note 67, at 604.
85. GATT Doc. DS27/2, at 2, Feb. 10, 1992. The Yugoslav complaint, directed only against the Community, did not mention embargo measures adopted by other parties, like the more extensive action taken by the United States, in this context.
86. As with the cases discussed above, the short introduction is meant to give an overview; key aspects will be taken up again where they figure in the argument.
87. See text at notes 40-54 supra. Ghana expressly relied on the statement that "[i]t should be noted that under . . . Article [XXI] each Contracting Party was the sole judge of what was necessary in its essential security interests." GATT Doc. SR.19/12, at 196 (1961).
88. This is not to say that the U.S. actions in that case or in others, e.g., under the Trading with the Enemy Act (Cuba, North Korea) or the International Emergency Economic Powers Act (Iran, Iraq, Libya, Nicaragua, Sudan), are any less reasoned. The Acts require the administration to find "an unusual and extraordinary threat" in order to justify restrictive measures. Nevertheless, it is crucial to the analysis before us to bear in mind that those are requirements under U.S. law. Although they may substantively correspond to (or even go beyond) the requirements of Article XXI of GATT et al., fulfilling the internal procedures and requirements does not relieve a state from providing justification under the rules of international law where applicable. One has to be able and willing to show one's entitlement when one claims an exception. Whether this general rule in law-based systems applies to states taking measures under Article XXI of GATT 1994 is what we are discussing here.
89. Ghana stated that the policy of Portugal vis-à-vis its African territories, namely Angola, permanently threatened stability in the region, and thus constituted an emergency in international relations under Article XXI(b)(iii). Ghana stressed that a country's security could be undermined by a potential, as well as by an actual, danger. Pressure on the Portuguese Government, it said, might reduce the danger to Ghana and was therefore justified under Article XXI(b) (iii). See GATT Doc. SR.19/12, supra note 73, at 196.
90. GATT Council, Minutes of Meeting held on May 7, 1982, GATT Doc. C/M/157, at 10 (June 22, 1982); see also Trade Restrictions Affecting Argentina Applied for Non-economic Reasons, GATT Doc. L/5319/Rev.1 (May 5, 1982). For an overview of the discussion, see Michael Gaugh, GATT Article XXI and U.S. Export Controls: The Invalidity of Nonessential Non-Proliferation Controls, 8 N.Y. INT'L L. REV. 51, 68-69 (1995).
91. See Hahn, supra note 12, at 573.
92. The European Community, the United States and Canada repeatedly stressed their view that GATT was not an appropriate forum in which to discuss the justification of the measures. See GATT Council, supra note 76; and GATT Council, Minutes of Meeting held on June 29-30, 1982, GATT Doc. C/M/159 (Aug. 10, 1982). To avoid misunderstanding, we note again that the questions of the applicable law and the appropriate forum do not necessarily demand parallel answers.
93. The representative of Brazil "agreed that each contracting party had the right to define its essential security interests, but he felt that some justification should in fact be given when it was apparent that no essential security interests were involved." GATT Council, supra note 76, at 12. The EC delegate, relying generally on "inherent rights," see text at note 76 supra, had not made that distinction, and it was not specifically referred to by other delegates. Thus, this distinction does not have precedential value in a technical sense, but it exposes, in our view, the crucial aspect of the interpretive problem under consideration.
94. GATT Doc. L/5426 (1982), GATT B.I.S.D. (29th Supp.) at 23 (1983).
95. Hahn, supra note 12, at 575.
96. See United States - Section 337 of the Tariff Act of 1930, Nov. 7, 1989, GATT B.I.S.D. (36th Supp.) at 345, para. 5.9 (1990) [hereinafter U.S. Tariff Act], on the identical language in Article XX of GATT 1947. See also United States - Restrictions on Imports of Tuna (unadopted), GATT B.I.S.D. (39th Supp.) at 155, para. 5.22 (1993) [hereinafter U.S. Tuna I]; U.S. Gasoline, supra note 38, at 22-23; United States - Measure Affecting Imports of Woven Wool Shirts and Blouses from India, May 23, 1997, WTO Doc. WT/DS33/AB/R, at 16-17; United States - Import Prohibition of Certain Shrimp and Shrimp Products, Nov. 6, 1998, WTO Doc. WT/DS58/AB/R, para. 157, reprinted in 38 ILM 118 (1999) [hereinafter U.S. Shrimp].
97. U.S. Shrimp, supra note 82, para. 156.
98. Id.; U.S. Gasoline, supra note 38, at 22. Past practice also shows that panels have consistently applied the GATTs exceptions, in particular Article XX, in such a way as not to frustrate its substantive rules. In particular, they have required contracting parties, where a prima facie violation of GATT principles has been established, to justify restrictive measures taken by them under an exception and to carry the burden of proof that the measure indeed comes under the exception. See Canada - Administration of the Foreign Investment Review Act, Feb. 7, 1984, GATT B.I.S.D. (30th Supp.) at 140, para. 5.20 (1984); U.S. Tariff Act, supra note 82, para. 5.27. In this connection, one panel pointed out that the "practice of panels has been to interpret Article XX narrowly, to place the burden on the party invoking Article XX to justify its invocation, and not to examine Article XX exceptions unless invoked." U.S. Tuna I, supra note 82, para. 5.22. Recently, however, the Appellate Body correctly stated: merely characterizing a treaty provision as an "exception" does not itself justify a "stricter" or "narrower" interpretation of that provision than would be warranted by examination of the ordinary meaning of the actual treaty words, viewed in the context and in the light of the treaty's object and purpose, or, in other words, by applying the normal rules of treaty interpretation. EC - Measures Concerning Meat and Meat Products (Hormones), Feb. 13, 1998, WTO Doc. WT/DS26.48/AB/R, para. 104 [hereinafter EC Meat Products]. The Appellate Body therefore overruled the panel and held that Article 3.3 of the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement) does not constitute an exception to Article 3.1 of the same Agreement, id., paras. 169-72, and has to be treated differently "from the relationship between, for instance, Articles I or III and Article XX of the GATT 1994," id., para. 104. However, this wording, in particular the reference to Article XX, also suggests that, if a provision clearly constitutes an exception - as do Articles XX and XXI - the Appellate Body still believes that the purpose of the treaty would be jeopardized if that exception were interpreted and applied without taking into account the necessary balance between the GATT's exceptions and substantive rights. The Appellate Body requires only that panels thoroughly examine the relationships among the various provisions they apply to a particular dispute.
99. Id.; U.S. Gasoline, supra note 38, at 22. Past practice also shows that panels have consistently applied the GATTs exceptions, in particular Article XX, in such a way as not to frustrate its substantive rules. In particular, they have required contracting parties, where a prima facie violation of GATT principles has been established, to justify restrictive measures taken by them under an exception and to carry the burden of proof that the measure indeed comes under the exception. See Canada - Administration of the Foreign Investment Review Act, Feb. 7, 1984, GATT B.I.S.D. (30th Supp.) at 140, para. 5.20 (1984); U.S. Tariff Act, supra note 82, para. 5.27. In this connection, one panel pointed out that the "practice of panels has been to interpret Article XX narrowly, to place the burden on the party invoking Article XX to justify its invocation, and not to examine Article XX exceptions unless invoked." U.S. Tuna I, supra note 82, para. 5.22. Recently, however, the Appellate Body correctly stated: merely characterizing a treaty provision as an "exception" does not itself justify a "stricter" or "narrower" interpretation of that provision than would be warranted by examination of the ordinary meaning of the actual treaty words, viewed in the context and in the light of the treaty's object and purpose, or, in other words, by applying the normal rules of treaty interpretation. EC - Measures Concerning Meat and Meat Products (Hormones), Feb. 13, 1998, WTO Doc. WT/DS26.48/AB/R, para. 104 [hereinafter EC Meat Products]. The Appellate Body therefore overruled the panel and held that Article 3.3 of the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement) does not constitute an exception to Article 3.1 of the same Agreement, id., paras. 169-72, and has to be treated differently "from the relationship between, for instance, Articles I or III and Article XX of the GATT 1994," id., para. 104. However, this wording, in particular the reference to Article XX, also suggests that, if a provision clearly constitutes an exception - as do Articles XX and XXI - the Appellate Body still believes that the purpose of the treaty would be jeopardized if that exception were interpreted and applied without taking into account the necessary balance between the GATT's exceptions and substantive rights. The Appellate Body requires only that panels thoroughly examine the relationships among the various provisions they apply to a particular dispute.
100. Id.; U.S. Gasoline, supra note 38, at 22. Past practice also shows that panels have consistently applied the GATTs exceptions, in particular Article XX, in such a way as not to frustrate its substantive rules. In particular, they have required contracting parties, where a prima facie violation of GATT principles has been established, to justify restrictive measures taken by them under an exception and to carry the burden of proof that the measure indeed comes under the exception. See Canada - Administration of the Foreign Investment Review Act, Feb. 7, 1984, GATT B.I.S.D. (30th Supp.) at 140, para. 5.20 (1984); U.S. Tariff Act, supra note 82, para. 5.27. In this connection, one panel pointed out that the "practice of panels has been to interpret Article XX narrowly, to place the burden on the party invoking Article XX to justify its invocation, and not to examine Article XX exceptions unless invoked." U.S. Tuna I, supra note 82, para. 5.22. Recently, however, the Appellate Body correctly stated: merely characterizing a treaty provision as an "exception" does not itself justify a "stricter" or "narrower" interpretation of that provision than would be warranted by examination of the ordinary meaning of the actual treaty words, viewed in the context and in the light of the treaty's object and purpose, or, in other words, by applying the normal rules of treaty interpretation. EC - Measures Concerning Meat and Meat Products (Hormones), Feb. 13, 1998, WTO Doc. WT/DS26.48/AB/R, para. 104 [hereinafter EC Meat Products]. The Appellate Body therefore overruled the panel and held that Article 3.3 of the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement) does not constitute an exception to Article 3.1 of the same Agreement, id., paras. 169-72, and has to be treated differently "from the relationship between, for instance, Articles I or III and Article XX of the GATT 1994," id., para. 104. However, this wording, in particular the reference to Article XX, also suggests that, if a provision clearly constitutes an exception - as do Articles XX and XXI - the Appellate Body still believes that the purpose of the treaty would be jeopardized if that exception were interpreted and applied without taking into account the necessary balance between the GATT's exceptions and substantive rights. The Appellate Body requires only that panels thoroughly examine the relationships among the various provisions they apply to a particular dispute.
101. Vienna Convention on the Law of Treaties, supra note 35, Art. 31(1).
102. In U.S. Shrimp, supra note 82, the Appellate Body pointed out that the need to strike a balance between the right to invoke an exception and the substantive rights under GATT derives not only from the chapeau of Article XX, but also from general principles of international law. In its view, the chapeau of Article XX "is, in fact, but one expression of the principle of good faith." Id., para. 158.
103. Understanding on Rules and Procedures Governing the Settlement of Disputes, Art. 23(1), in FINAL ACT, supra note 8, reprinted in 33 ILM at 1226.
104. Id., Art. 6(1).
105. Id., Arts. 16(4) and 17(14), respectively.
106. Id., Art. 22(6) and (7).
107. I.e., the DSU, as opposed to the practice under the relevant understandings and decisions within the framework of GATT 1947, requires a consensus of the Dispute Settlement Body not to establish a panel, not to adopt a panel or Appellate Body report, etc.
108. The importance of the position of Article XXI between Article XX on general exceptions and the dispute settlement provisions in Articles XXII and XXIII is further highlighted by the legislative history of the national security exceptions. At the outset of the negotiations on the establishment of an International Trade Organization, the suggested Charter, as proposed by the United States in 1946, as well as the first draft prepared by the Preparatory Committee in London in October and November of 1946 and the draft prepared by a technical drafting committee in New York in January and February of 1947, provided for national security exceptions only as part of the general exceptions to the chapters on commercial policy and commodity agreements. See, respectively, U.S. DEP'T OF STATE, PUB. No. 2598, SUGGESTED CHARTER FOR THE INTERNATIONAL TRADE ORGANIZATION OF THE UNITED NATIONS, Arts. 32, 49 (Commercial Policy Series 93, 1946); London and New York Draft Charters, Arts. 37, 59 , cited in GATT, ANALYTICAL INDEX, supra note 67, at 608. Only at the meeting of the Preparatory Committee in Geneva from April to October 1947 was it decided to transfer the security exceptions from the general exceptions to a separate article at the end of the Charter, which was practically identical with the present text of GATT Article XXI. See. Geneva Draft Charter, Art. 94, cited in GATT, ANALYTICAL INDEX, supra, at 608. This transfer raised concerns at the Geneva meeting about the applicability of the dispute settlement mechanism to the security exception because these provisions were located at a substantial remove in Article 35 of the New York Draft Charter. However, it was generally agreed that this removal would not affect the application of the dispute settlement mechanism regarding the new article (see text at notes 93-98 infra). Thus, the contracting parties of GATT 1947 were well aware of the arguments that might be derived from the position of the security exception in the General Agreement and intended to remedy any doubts about the reach of Article XXI by placing it between the general exceptions and the dispute settlement provisions.
109. The importance of the position of Article XXI between Article XX on general exceptions and the dispute settlement provisions in Articles XXII and XXIII is further highlighted by the legislative history of the national security exceptions. At the outset of the negotiations on the establishment of an International Trade Organization, the suggested Charter, as proposed by the United States in 1946, as well as the first draft prepared by the Preparatory Committee in London in October and November of 1946 and the draft prepared by a technical drafting committee in New York in January and February of 1947, provided for national security exceptions only as part of the general exceptions to the chapters on commercial policy and commodity agreements. See, respectively, U.S. DEP'T OF STATE, PUB. No. 2598, SUGGESTED CHARTER FOR THE INTERNATIONAL TRADE ORGANIZATION OF THE UNITED NATIONS, Arts. 32, 49 (Commercial Policy Series 93, 1946); London and New York Draft Charters, Arts. 37, 59 , cited in GATT, ANALYTICAL INDEX, supra note 67, at 608. Only at the meeting of the Preparatory Committee in Geneva from April to October 1947 was it decided to transfer the security exceptions from the general exceptions to a separate article at the end of the Charter, which was practically identical with the present text of GATT Article XXI. See. Geneva Draft Charter, Art. 94, cited in GATT, ANALYTICAL INDEX, supra, at 608. This transfer raised concerns at the Geneva meeting about the applicability of the dispute settlement mechanism to the security exception because these provisions were located at a substantial remove in Article 35 of the New York Draft Charter. However, it was generally agreed that this removal would not affect the application of the dispute settlement mechanism regarding the new article (see text at notes 93-98 infra). Thus, the contracting parties of GATT 1947 were well aware of the arguments that might be derived from the position of the security exception in the General Agreement and intended to remedy any doubts about the reach of Article XXI by placing it between the general exceptions and the dispute settlement provisions.
110. The importance of the position of Article XXI between Article XX on general exceptions and the dispute settlement provisions in Articles XXII and XXIII is further highlighted by the legislative history of the national security exceptions. At the outset of the negotiations on the establishment of an International Trade Organization, the suggested Charter, as proposed by the United States in 1946, as well as the first draft prepared by the Preparatory Committee in London in October and November of 1946 and the draft prepared by a technical drafting committee in New York in January and February of 1947, provided for national security exceptions only as part of the general exceptions to the chapters on commercial policy and commodity agreements. See, respectively, U.S. DEP'T OF STATE, PUB. No. 2598, SUGGESTED CHARTER FOR THE INTERNATIONAL TRADE ORGANIZATION OF THE UNITED NATIONS, Arts. 32, 49 (Commercial Policy Series 93, 1946); London and New York Draft Charters, Arts. 37, 59 , cited in GATT, ANALYTICAL INDEX, supra note 67, at 608. Only at the meeting of the Preparatory Committee in Geneva from April to October 1947 was it decided to transfer the security exceptions from the general exceptions to a separate article at the end of the Charter, which was practically identical with the present text of GATT Article XXI. See. Geneva Draft Charter, Art. 94, cited in GATT, ANALYTICAL INDEX, supra, at 608. This transfer raised concerns at the Geneva meeting about the applicability of the dispute settlement mechanism to the security exception because these provisions were located at a substantial remove in Article 35 of the New York Draft Charter. However, it was generally agreed that this removal would not affect the application of the dispute settlement mechanism regarding the new article (see text at notes 93-98 infra). Thus, the contracting parties of GATT 1947 were well aware of the arguments that might be derived from the position of the security exception in the General Agreement and intended to remedy any doubts about the reach of Article XXI by placing it between the general exceptions and the dispute settlement provisions.
111. In particular, Article 94 of the Geneva Draft Charter, supra note 92.
112. See, e.g., WILLIAM ADAMS BROWN, THE UNITED STATES AND THE RESTORATION OF WORLD TRADE: AN ANALYSIS AND APPRAISAL OF THE I.T.O. CHARTER AND THE GENERAL AGREEMENT ON TARIFFS AND TRADE, esp. 351-52 (1950).
113. See, e.g., the statement by U.S. delegate Evans in the Czechoslovak dispute: "And I believe that most of the delegates present will feel greater security for their own future because the United States is, in fact, making use of these exceptions." Doc. GATT/CP.3/38, supra note 52, at 4.
114. See the verbatim reports of Commission A of the Preparatory Committee at its Geneva meeting, Doc. EPCT/A/PV/33, at 26-29, quoted in GATT, ANALYTICAL INDEX, supra note 67, at 705. For additional details, see Hahn, supra note 12, at 565-69.
115. The Commission stated: This article contains no provisions requiring members to obtain the approval of the Organization for any action they take or refuse to take under these exceptions, although it appears likely that charges dial the exceptions were being abused for protective or other purposes would require consultation under Article 89 and decision by the Organization under Article 90 if the consultation should not result in satisfactory settlement. U.S. TARIFF COMMISION, ANALYSIS: GENEVA DRAFT OF THE CHARTER FOR AN INTERNATIONAL TRADE ORGANIZATION 85 (1947) Angeles 89 and 90 of the proposed ITO Charter were the equivalent of Article XXIII of GATT 1947. Of course, the limitations of the Tariff Commission's authority must be borne in mind.
116. GATT, ANALYTICAL, INDEX, supra note 67, at 600.
117. On standards of review and judicial restraint, see text at notes 123-28 infra.
118. This view has been voiced by many, but usually without any thorough analysis of the text and context. See, e.g., Richard Sutherland Whitt, The Politics of Procedure: An Examination of the GATT Dispute Settlement Panel and the Article XXI Defense in the Context of the U.S. Embargo of Nicaragua, 19 LAW & POL'Y INT'L BUS. 604, 616 (1987).
119. See our observations in the paragraph at note 37 supra.
120. See supra note 98 and corresponding text.
121. See supra note 73.
122. Arguably, one could see such a reading in Military and Paramilitary Activities in and against Nicaragua (Nicar. v. U.S.), Merits, 1986 ICJ REP. 14, 116, para. 222 (June 27). There, the International Court of Justice (ICI) evaluated the justiciability of the national security exception in Article XXI (d) of the 1956 U.S.-Nicaragua Treaty of Friendship Commerce and Navigation, contrasting it with Article XXI of GATT. The 1956 Treaty provision states that "the present Treaty shall not preclude the application of measures . . . necessary to protect [a party's] essential security interests." The ICJ held: That the Court has jurisdiction to determine whether measures taken by one of the Parties fall within such an exception is also clear a contrario from the fact that the text of Article XXI of the Treaty does not employ the wording which was already to be found in Article XXI of the General Agreement on Tariffs and Trade. This provision of GATT . . . stipulates that the Agreement is not to be construed to prevent any contracting party from taking any action which it "considers necessary for the protection of its essential security interests" . . . . The 1956 Treaty, on the contrary, speaks simply of "necessary" measures, not of those considered by a party to be such. Id. Note however that the ICJ did not (and did not intend to) interpret Article XXI of GATT. The absence of the term "considers" from Article XXI(d) of the 1956 Treaty clearly suggests the ICJ's interpretation of it. Hence the ICJ's conclusion that this provision is objective, and thus justiciable, is, as the Court points out, rather obvious. However, the ICJ did not address, either implicitly or explicitly, whether or not the presence of "considers" in Article XXI of GATT renders this provision nonjusticiable, in whole or in part. Hence, the ICJ's decision in this case leaves ample room for the differentiated interpretation of the term "considers" in Article XXI of the GATT that we suggest below.
123. This concept is structurally similar to the "precautionary principle" in international environmental law. On that principle see e.g., Owen McIntyre & Thomas Mosedale, The Precautionary Principle as a Norm of Customary International Law, 9 J. ENVTL. L. 221 (1997); James Cameron & Will Wade-Gery, Addressing Uncertainty: Law Policy and the Development of the Precautionary Principle, in ENVIRONMENTAL POLICY IN SEARCH OF NEW INSTRUMENTS 95 (Bruno Dente ed., 1995). See also EC Meat Products, supra note 84, paras. 120-25.
124. This concept is structurally similar to the "precautionary principle" in international environmental law. On that principle see e.g., Owen McIntyre & Thomas Mosedale, The Precautionary Principle as a Norm of Customary International Law, 9 J. ENVTL. L. 221 (1997); James Cameron & Will Wade-Gery, Addressing Uncertainty: Law Policy and the Development of the Precautionary Principle, in ENVIRONMENTAL POLICY IN SEARCH OF NEW INSTRUMENTS 95 (Bruno Dente ed., 1995). See also EC Meat Products, supra note 84, paras. 120-25.
125. One might contest that finding. As noted, in Military and Paramilitary Activities in and against Nicaragua, the ICJ concluded that, in the absence of the term "considers," the treaty clause "necessary to protect its essential security interests" was justiciable. However, a close reading reveals that the ICJ did not see itself as authorized to provide its own interpretation of "essential security interests" but intended to exercise restraint: [T]he concept of essential security interests certainly extends beyond the concept of armed attack, and has been subject to very broad interpretations in the past. The Court has therefore to assess whether the risk run by these "essential security interests" is reasonable, and secondly, whether the measures presented as being designed to protect these interests are not merely useful but "necessary". 1986 ICJ REP. 14, 117, para. 224. The Court's ensuing application of the law to the facts is inconclusive with regard to who, ultimately, is to determine the exact content of "essential security interests," as a determination was not necessary: "Since no evidence at all is available to show how Nicaraguan policies had in fact become a threat to 'essential security interests' in May 1985, . . . the Court is unable to find that the embargo was 'necessary' to protect those interests." Id. at 141, para. 282. The ICJ's reference above to "reasonable" and "not merely useful but necessary" suggests, however, that the Court intended to exercise only general negative review to contain abuse or misuse. In so doing, it would have left the United States considerable room for its own definition of its essential security interests.
126. One might contest that finding. As noted, in Military and Paramilitary Activities in and against Nicaragua, the ICJ concluded that, in the absence of the term "considers," the treaty clause "necessary to protect its essential security interests" was justiciable. However, a close reading reveals that the ICJ did not see itself as authorized to provide its own interpretation of "essential security interests" but intended to exercise restraint: [T]he concept of essential security interests certainly extends beyond the concept of armed attack, and has been subject to very broad interpretations in the past. The Court has therefore to assess whether the risk run by these "essential security interests" is reasonable, and secondly, whether the measures presented as being designed to protect these interests are not merely useful but "necessary". 1986 ICJ REP. 14, 117, para. 224. The Court's ensuing application of the law to the facts is inconclusive with regard to who, ultimately, is to determine the exact content of "essential security interests," as a determination was not necessary: "Since no evidence at all is available to show how Nicaraguan policies had in fact become a threat to 'essential security interests' in May 1985, . . . the Court is unable to find that the embargo was 'necessary' to protect those interests." Id. at 141, para. 282. The ICJ's reference above to "reasonable" and "not merely useful but necessary" suggests, however, that the Court intended to exercise only general negative review to contain abuse or misuse. In so doing, it would have left the United States considerable room for its own definition of its essential security interests.
127. One might contest that finding. As noted, in Military and Paramilitary Activities in and against Nicaragua, the ICJ concluded that, in the absence of the term "considers," the treaty clause "necessary to protect its essential security interests" was justiciable. However, a close reading reveals that the ICJ did not see itself as authorized to provide its own interpretation of "essential security interests" but intended to exercise restraint: [T]he concept of essential security interests certainly extends beyond the concept of armed attack, and has been subject to very broad interpretations in the past. The Court has therefore to assess whether the risk run by these "essential security interests" is reasonable, and secondly, whether the measures presented as being designed to protect these interests are not merely useful but "necessary". 1986 ICJ REP. 14, 117, para. 224. The Court's ensuing application of the law to the facts is inconclusive with regard to who, ultimately, is to determine the exact content of "essential security interests," as a determination was not necessary: "Since no evidence at all is available to show how Nicaraguan policies had in fact become a threat to 'essential security interests' in May 1985, . . . the Court is unable to find that the embargo was 'necessary' to protect those interests." Id. at 141, para. 282. The ICJ's reference above to "reasonable" and "not merely useful but necessary" suggests, however, that the Court intended to exercise only general negative review to contain abuse or misuse. In so doing, it would have left the United States considerable room for its own definition of its essential security interests.
128. See generally the study on international relations theory, THE CULTURE OF NATIONAL SECURITY: NORMS AND IDENTITY IN WORLD POLITICS (Peter J. Katzenstein ed. 1996). See in particular Peter J. Katzenstein, Introduction to id., and Ronald L. Jepperson, Alexander Wendt & Peter J. Katzenstein, Norms, Identity, and Culture, in National Security, in id. at 33. This is not to say that sovereignty and its expressions, like national security, are in any way limitless. The question of the essence of sovereignty, of course, goes far beyond the scope of this study. For a recent study touching on the ever-closer limitations, or restrictive redefinitions, of features of sovereignty in different spheres of international law, see Franz X. Perrez, The Relationship between "Permanent Sovereignty" and the Obligation Not to Cause Transboundary Environmental Damage, 26 ENVTL. L. 1187 (1996).
129. See generally the study on international relations theory, THE CULTURE OF NATIONAL SECURITY: NORMS AND IDENTITY IN WORLD POLITICS (Peter J. Katzenstein ed. 1996). See in particular Peter J. Katzenstein, Introduction to id., and Ronald L. Jepperson, Alexander Wendt & Peter J. Katzenstein, Norms, Identity, and Culture, in National Security, in id. at 33. This is not to say that sovereignty and its expressions, like national security, are in any way limitless. The question of the essence of sovereignty, of course, goes far beyond the scope of this study. For a recent study touching on the ever-closer limitations, or restrictive redefinitions, of features of sovereignty in different spheres of international law, see Franz X. Perrez, The Relationship between "Permanent Sovereignty" and the Obligation Not to Cause Transboundary Environmental Damage, 26 ENVTL. L. 1187 (1996).
130. See generally the study on international relations theory, THE CULTURE OF NATIONAL SECURITY: NORMS AND IDENTITY IN WORLD POLITICS (Peter J. Katzenstein ed. 1996). See in particular Peter J. Katzenstein, Introduction to id., and Ronald L. Jepperson, Alexander Wendt & Peter J. Katzenstein, Norms, Identity, and Culture, in National Security, in id. at 33. This is not to say that sovereignty and its expressions, like national security, are in any way limitless. The question of the essence of sovereignty, of course, goes far beyond the scope of this study. For a recent study touching on the ever-closer limitations, or restrictive redefinitions, of features of sovereignty in different spheres of international law, see Franz X. Perrez, The Relationship between "Permanent Sovereignty" and the Obligation Not to Cause Transboundary Environmental Damage, 26 ENVTL. L. 1187 (1996).
131. See generally the study on international relations theory, THE CULTURE OF NATIONAL SECURITY: NORMS AND IDENTITY IN WORLD POLITICS (Peter J. Katzenstein ed. 1996). See in particular Peter J. Katzenstein, Introduction to id., and Ronald L. Jepperson, Alexander Wendt & Peter J. Katzenstein, Norms, Identity, and Culture, in National Security, in id. at 33. This is not to say that sovereignty and its expressions, like national security, are in any way limitless. The question of the essence of sovereignty, of course, goes far beyond the scope of this study. For a recent study touching on the ever-closer limitations, or restrictive redefinitions, of features of sovereignty in different spheres of international law, see Franz X. Perrez, The Relationship between "Permanent Sovereignty" and the Obligation Not to Cause Transboundary Environmental Damage, 26 ENVTL. L. 1187 (1996).
132. One may doubt whether this personification of the state is in principle an appropriate approach to the problem, but it seems indisputable that it is in (relevant) part an appropriate description of the phenomenon of sovereignty - and therefore the question of national security before us - as it is understood by those exercising it.
133. See note 79 supra and corresponding text.
134. In 1975 Sweden introduced a quota for certain types of shoes, arguing that the decrease in its domestic capacity to produce footwear, qualified as "vital industry," threatened the country's economic defense strategy and thus its security interests. Many contracting parties correctly took the position that this was precisely the kind of justification not available under Article XXI. See further GATT, ANALYTICAL INDEX, supra note 67, at 603; and Hahn, supra note 12, at 578, 580.
135. See generally JOHN H. JACKSON, WILLIAM J. DAVEY & ALAN O. SYKES, LEGAL PROBLEMS OF INTERNATIONAL ECONOMIC RELATIONS 1-2, 7-14 (3d ed. 1995).
136. This understanding is underlined by the types of requirements set out in subparagraphs (b) (i)-(iii); see text at notes 116-18 infra.
137. In most cases, this is an auxilliary duty under GATT, linked to more important primary obligations. See, e.g., GATT 1994, supra note 8, Arts. VI(6) (c), VII(I), X, XI(c), XII(4)(a), XVII(4) (a)-(c), XIX(2).
138. An instance that might possibly show that a government acted in bad faith is the leaking of secret cabinet minutes. See Hahn, supra note 12, at 583.
139. See e.g., the statement of U.S. representative Evans, supra note 52, at 9, pointing out that under Article XXI a GATT party "shall not be required to give information which it considers contrary to its security interests. The United States considers it contrary to its security interests - and to the security interests of other friendly countries - to reveal the names of the commodities that it considers to be most strategic.
140. The limited discussion in the 1949 Czechoslovakia/U.S. dispute referred to above does not provide a counterexample, as that discussion, apart from being very general, did not reach the point of differentiation between "arms" and "other goods and materials." 117 See Hahn, supra note 12, at 589.
141. For further thoughts, see id. at 589-91.
142. One might add: before the recent Hormones decision, EC Meat Products, supra note 84, on the SPS Agreement. See infra notes 122, 124.
143. Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994, in Annex 1A to the Agreement Establishing the World Trade Organization, opened for signature Apr. 15, 1994, FINAL ACT, supra note 8, reprinted in WTO, THE RESULTS OF THE URUGUAY ROUND OF MULTILATERAL TRADE NEGOTIATIONS - THE LEGAL TEXTS 168 (1995) [hereinafter LEGAL TEXTS].
144. Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994, in Annex 1A to the Agreement Establishing the World Trade Organization, opened for signature Apr. 15, 1994, FINAL ACT, supra note 8, reprinted in WTO, THE RESULTS OF THE URUGUAY ROUND OF MULTILATERAL TRADE NEGOTIATIONS - THE LEGAL TEXTS 168 (1995) [hereinafter LEGAL TEXTS].
145. On the content and reach of this provision, see Steven P. Croley & John H. Jackson, WTO Dispute Procedures, Standard of Review, and Deference to National Governments, 90 AJIL 193 (1996), discussing in particular the applicability of the U.S. Chevron doctrine in the WTO antidumping context.
146. The Appellate Body recently held in EC Meat Products, supra note 84, that Article 17.6(i) of the Anti-Dumping Agreement (regarding deference in the establishment of facts) was "textually specific" to that Agreement. The Ministerial Decision on the Review of Article 17.6 of the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994, reprinted in LEGAL TEXTS, supra note 120, at 453, states: "The standard of review in paragraph 6 of Article 17 of the Agreement on Implementation of Article VI of GATT 1994 shall be reviewed after a period of three years with a view to considering the question of whether it is capable of general application" (emphasis added). Following the U.S. view, the Appellate Body found that this Ministerial Decision "evidences that the Ministers were aware that Article 17.6 of the Anti-Dumping Agreement was applicable only in respect of that Agreement." EC Meat Products, supra, para. 114. Article 17.6 of the Anti-Dumping Agreement therefore cannot be analogized to other Agreements. See also note 124 infra.
147. See JOHN H. JACKSON & ANDREAS F. LOWENFELD, HELMS-BURTON, THE U.S., AND THE WTO 3 (ASIL Insight No. 7, 1997) (http://www.asil.org/asil/insight7.htm).
148. In this context the recent report, EC Meat Products, supra note 84, provides a most interesting insight into the Appellate Body's approach to standards of review. Asked to determine the standard of review of members protective measures under the SPS Agreement, the Appellate Body did two things: First, it all but unequivocally stated that the Dispute Settlement Body, its panels and the Appellate Body are competent to deal authoritatively with any matter of interpretation of the covered agreements: In so far as legal questions are concerned - that is, consistency or inconsistency of a Member's measure with the provisions of the applicable agreement - a standard not found in the text of the SPS Agreement itself cannot absolve a panel (or the Appellate Body) from the duty to apply the customary rules of interpretation of public international law. Id., para 118. Second, it held that, in the absence of an applicable specific standards-review provision, such as Article 17 6 of the Anti-Dumping Agreement, see text at notes 120-22 and note 122 supra, Article 11 of the DSU applied. As regards the establishment of facts, Article 11, in the Appellate Body's interpretation id., para. 114 provides neither for a de novo inquiry by panels nor for a "deferential 'reasonableness' standard," as the Community had contended, referring to Article 17.6 of the Anti-Dumping Agreement, but for an "objective assessment of the facts," id., para. 116, apparently somewhere in between. However, the Appellate Body identified the notion of "risk" in the context of the SPS Agreement as a function of the scientific establishment of facts (and discussed the precautionary principle separately). For the reasons developed at length above, this could not apply directly in the context of Article XXI with regard to subjective concepts such as "essential security interests." Nevertheless, the Appellate Body clearly found that the system as a whole, in the context of international law and its standards of interpretation, is to be understood as providing the necessary framework for determining appropriate standards of review where necessary.
149. For an - admittedly not necessarily reassuring - older example of a panel's search for adequate standards of review under GATT 1947, see United States-Restrictions on Imports of Tuna, June 1994, GATT Doc. DS29/R, para. 3.73, 33 ILM 839 (1994).
150. The content and reach of the doctrine of good faith in its application are easily underestimated. For a substantive interpretation with regard to its application in the context of Article XXI see Knoll, supra note 10, at 586-90 However, Knoll, without further explanation, doubts its judicial reviewability, id. at 589.
151. See the statement by U.S. delegate Evans in the 1949 Czechoslovakia dispute, supra note 52, at 9.
152. 369 U.S. 186, 217 (1962). The German Constitutional Court has developed a similar approach, respecting, where appropriate, the "discretionary prerogative" (Einschätzungsprärogative) of the organ or entity concerned.
153. For a list of (possible) GATT violations, see text at note 31 supra; and, e.g., Brian J. Welke, GATT and NAFTA v. the Helms-Burton Act: Has the United States Violated Multilateral Agreements? 4 TULSA J. COMP. & INT'L L. 361, 367-70 (1997); Luisette Gierbolini, The Helms-Burton Act: Inconsistency with International Law and Irrationality at their Maximum, 6 J. TRANSNAT'L, L. & POL'Y 289 (1997) (discussing GATT violations at 313-15). In contrast, Pavel K. Chudzicki, The European Union's Response to the Libertad Act and the Iran-Libya Act: Extraterritoriality without Boundaries? 28 LOY. U. CHI. L.J. 505, 545-46 (1997), sees no violation of GATT but of GATS, and, in any case, a general threat to the WTO system, id. at 547. See also Spanogle, supra note 13.
154. For a list of (possible) GATT violations, see text at note 31 supra; and, e.g., Brian J. Welke, GATT and NAFTA v. the Helms-Burton Act: Has the United States Violated Multilateral Agreements? 4 TULSA J. COMP. & INT'L L. 361, 367-70 (1997); Luisette Gierbolini, The Helms-Burton Act: Inconsistency with International Law and Irrationality at their Maximum, 6 J. TRANSNAT'L, L. & POL'Y 289 (1997) (discussing GATT violations at 313-15). In contrast, Pavel K. Chudzicki, The European Union's Response to the Libertad Act and the Iran-Libya Act: Extraterritoriality without Boundaries? 28 LOY. U. CHI. L.J. 505, 545-46 (1997), sees no violation of GATT but of GATS, and, in any case, a general threat to the WTO system, id. at 547. See also Spanogle, supra note 13.
155. For a list of (possible) GATT violations, see text at note 31 supra; and, e.g., Brian J. Welke, GATT and NAFTA v. the Helms-Burton Act: Has the United
156. For a list of (possible) GATT violations, see text at note 31 supra; and, e.g., Brian J. Welke, GATT and NAFTA v. the Helms-Burton Act: Has the United States Violated Multilateral Agreements? 4 TULSA J. COMP. & INT'L L. 361, 367-70 (1997); Luisette Gierbolini, The Helms-Burton Act: Inconsistency with International Law and Irrationality at their Maximum, 6 J. TRANSNAT'L, L. & POL'Y 289 (1997) (discussing GATT violations at 313-15). In contrast, Pavel K. Chudzicki, The European Union's Response to the Libertad Act and the Iran-Libya Act: Extraterritoriality without Boundaries? 28 LOY. U. CHI. L.J. 505, 545-46 (1997), sees no violation of GATT but of GATS, and, in any case, a general threat to the WTO system, id. at 547. See also Spanogle, supra note 13.
157. See, e.g., August Reinisch, Widening the US Embargo against Cuba Extraterritorially: A Few Public International Law Comments on the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996, 7 EUR. J. INT'L L. 545, 560-61 (1996). Spanogle, supra note 13, finds no GATT or GATS violation in titles III and IV of the Act, see id. at 1325-28, but considers that title I violates Articles I and V of GATT 1994, id. at 1318-25.
158. See, e.g., August Reinisch, Widening the US Embargo against Cuba Extraterritorially: A Few Public International Law Comments on the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996, 7 EUR. J. INT'L L. 545, 560-61 (1996). Spanogle, supra note 13, finds no GATT or GATS violation in titles III and IV of the Act, see id. at 1325-28, but considers that title I violates Articles I and V of GATT 1994, id. at 1318-25.
159. See, e.g., August Reinisch, Widening the US Embargo against Cuba Extraterritorially: A Few Public International Law Comments on the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996, 7 EUR. J. INT'L L. 545, 560-61 (1996). Spanogle, supra note 13, finds no GATT or GATS violation in titles III and IV of the Act, see id. at 1325-28, but considers that title I violates Articles I and V of GATT 1994, id. at 1318-25.
160. See, on the one hand, Spanogle, supra note 13, at 1327, in particular n.73, who regards that concept as inapplicable (and thus as not providing a basis for a (nonviolation) complaint); and, on the other hand, Bhala, supra note 43, at 279, who sees a clear and credible nonviolation claim against the secondary effects of Helms-Burton.
161. See, e.g., Act, supra note 5, §301 (6) (A), (B).