Just Articles Flashcards
GATT Article 1
Most-Favoured-Nation (MFN) Treatment
Any trade benefit for one member applies to all
There exist conditional and unconditional MFN. Covers both de jura and de facto discrimination. There is a possibility of free riding.
GATT Article 2
Schedules of Concessions
Bound Tariffs: Maximum tariff rates agreed upon and automatically extended to all WTO Members; listed in each country’s Schedule of Concessions.
Tariffs cannot exceed the bound levels.
GATT Article 3
National Treatment
Imported products must receive treatment no less favorable than domestic products.
- Like products - identical taxation.
- Directly competitive and substitutable products - taxed similarly provided it’s not protectionism.
de jure (obvious discrimination, “imported alcohol will be taxed”) and de facto (less obvious, “alcohol above 25% will be taxed” while mostly imported alcohol meets the criteria) discrimination
GATT Article 6
Anti-Dumping and Subsidies
Anti-dumping duties are allowed when products are sold below their normal value and harm domestic industries.
Countervailing Duties are permitted to offset subsidies given by other governments to their exporters.
Conditions: duties apply only if material injury to domestic industries is proven; a duty does not exceed the damage the action caused; investigations must follow WTO rules.
GATT Article 8
Fees and Formalities
Fees have to be fair and can’t restrict trade indirectly. They have to be simple.
GATT Article 11
Elimination of Quantitative Restrictions
Prohibits limits on trade quantities.
Exceptions: Allowed for specific cases (e.g., food shortages).
GATT Article 12
Restrictions to Safeguard the Balance of Payments
Temporary quotas, tariffs, or restrictions to address financial instability or low foreign reserves.
GATT Article 13
Non-Discrimination in the Application of Restrictions
Restrictions must apply equally to all WTO members and reasons for them must be clear and justifiable.
GATT Article 19
Safeguard Measures
Countries can impose restrictions (e.g., higher tariffs or quotas) to protect domestic industries.
GATT Article 20
General Exceptions
Allows countries to adopt measures that would normally violate GATT rules if they are necessary to achieve specific legitimate objectives.
a. necessary to protect public morals
b. protect human, animal or plant life or health (even outside teh country’s territory)
c. regulate gold or sliver trade
d. enforce laws consistent with GATT
e. address product of prison labor
f. safeguard national treasures
g. conserve exhaustible natural resources
h. fulfill intergovernmental commodity agreements
i. restrict exports to stabilize domestic industries
j. ensure equitable distribution during shortages
*there should NOT be any less restrictive alternate measures.
GATT Article 21
Security Exceptions
Allows countries to take actions that are necessary for their national security, even if they conflict with GATT rules.
Applies during war or crises. There is no obligation to share sensitive info.
GATT Article 24
Customs Unions and Free Trade Areas
- Free Trade Areas (FTAs): Substantially all duties and other restrictive regulations are removed for nearly all trade between member countries, but only for products originating within those countries. (They are more common)
- Customs Unions (CUs): Members eliminate substancially all duties and regulations for trade between them and all apply the same duties and regulations to trade with non-memeber countries.
Agreements must not harm trade with other members (duties and other trade restrictions applied to non-members cannot increase when forming FTA or CU).
*Developing countries have more flexibility when forming RTAs as long as it supports their economic development and aligns with WTO principles.
WTO Article 22
Compensation and Suspension of Concessions
Compensation: The harmed country may get trade benefits.
Suspend Concessions: The harmed country may impose restrictions against the violator.
Actions must match the harm caused and follow WTO rules.
WTO Article 23
Strengthening Dispute Settlement
Disruptions to trade:
a) Failure to meet obligation by one party
b) Application of another party any measure that disrupts trade
c) Any other situation impeding trade
If any of above happen countries can’t retaliate alone disputes must go through the WTO.
