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Simon Lester
Florida
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An authoritative interpretation is fine with me. I'm not sure what the US thinks of this idea. And I'm not sure what others think either. Seems to me that it's worth debating, though, so I keep trying to put it out there!
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Thanks, Julia. The way I see this proposal is that it would send a message to the AB that the interpretation you noted above is incorrect. It does so by illustrating a specific set of circumstances where there can be more than one permissible interpretation. In the linked blog post, I had a suggestion that goes even further: "The revised Article 17.6(ii) text could say that if the meaning is "ambiguous or obscure" after Article 31(1) alone is applied, then the presumption of multiple permissible interpretations would apply."
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Thanks for the comment, Harlan. Your interpretation of what the US wants here is certainly a reasonable one, but there is still a lot of uncertainty. We were just trying to address one particular aspect, and resolution of the broader disagreement is a challenge!
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Yes, but there have been no actual Article IX:2 interpretations.
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As far as I know (someone please correct me if I'm wrong), there has never been an Article IX:2 interpretation, so in practice this issue does not come up.
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This is from the Section 301 report: "the Chinese government uses foreign ownership restrictions, such as formal and informal JV requirements, and other foreign investment restrictions to require or pressure technology transfer from U.S. companies to Chinese entities. ... the Chinese government uses its administrative licensing and approvals processes to force technology transfer in exchange for the numerous administrative approvals needed to establish and operate a business in China. " Sounds to me like the US thinks the Chinese government is doing some coercing.
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I agree. I just find the point interesting nonetheless.
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There are likely to be different opinions as to what was agreed.
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Also, last year I said this: "I've been thinking that there are too many findings of DSU Article 11 violations these days." https://worldtradelaw.typepad.com/ielpblog/2018/05/dsu-article-11-and-the-reasoning-of-panels.html
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I discussed these issues a while back in a journal article. Here is one of my points: "It is worth noting at the outset, when thinking about DSU Article 11 as a mechanism for appeal, that the language of Article 11 was carried over from the Tokyo Round 1979 Understanding. Paragraph 16 of this Understanding states: The function of panels is to assist the CONTRACTING PARTIES in discharging their responsibilities under Article XXIII:2. Accordingly, a panel should make an objective assessment of the matter before it, including an objective assessment of the facts of the case and the applicability of and conformity with the General Agreement …22 Thus, paragraph 16 mirrors closely the language of Article 11. Arguably, this language was not designed as the appellate standard of review for factual questions, as it existed prior to there being an appeal mechanism."
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Exactly. They are coming so close, and the fact that they have not gone all the way makes me wonder what is going on (some internal disagreement, either on substance or strategy?). I think it would be reasonable to propose eliminating DSU Article 11 as the basis for appeals, and such a proposal would lead to an interesting debate. Appeals on a basis such as this one are pretty common in domestic legal systems, but they are not required.
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Jesse, You may be right, but it's interesting that with all the US has said about WTO DS, it has not said "get rid of DSU Article 11 appeals."
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Hi Julia, I have not double-checked, but I'm pretty sure this is the first time a prior AB position has been referred to as "flawed" and "mistaken." I agree that this is significant.
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Thanks, Ted. I'm curious about what Lighthizer had in mind here. Maybe it was this.
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Pedro, Thanks for your comment. I probably should have clarified the context for this post, which was a twitter discussion where someone mentioned the Lincoln quote. I was just using this post as a place to make the text of the Taussig chapter available. But yes, as you point out, Lincoln did preside over high tariffs.
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Yes, it does have tools that it uses. I'm just thinking of ways to give it additional tools, and steer it explicitly in the direction of using them.
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I guess what I have in mind here is not an out of control tariff war, but rather one that moves beyond the terms of the Section 232 agreements. The US might impose tariffs based on a "meaningful surge"; Canada and Mexico might disagree that there was such a surge, and therefore retaliate beyond the designated sectors; and then the US might increase its retaliation. But we probably won't get to any of that. Mostly I'm just interested in how the US is pushing international agreements that explicitly provide for unilateral determinations, and avoid neutral adjudication.
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On the non-violation possibility, when you take into account DSU Article 26, could the complaining party impose retaliation? Article 26 is a bit confusing, but it seems to me that it could make it difficult to pursue retaliation. How do you see the relationship of Article 26 and Articles 21/22?
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I suppose it depends on what we mean by "escalate." If the US imposed tariffs in a situation when, in the view of Canada and Mexico, imports had not surged "meaningfully beyond historic volumes," would Canada and Mexico restrict their retaliation to the affected sectors?
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Yes, possibly GATS as well. I'm not sure what the full ranges of products/services affected would be.
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With internet censorship, I figured they would just ask for a complete exemption. But on data localization, why do they want a full carveout? I would think they could strike a balance here -- allowed under certain conditions, but not used in all cases. It seems like that is where most countries are headed.
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To clarify, I don't think there is any credible argument for an "emergency in international relations" related to Canada. Rather, the emergency would be some ongoing military conflict somewhere in the world, and the United States would try to tie the steel/aluminum restrictions to the need to have a strong military to deal with that conflict. I think that tying argument would fail, but that's how I see the U.S. arguing it. For Mexico, I guess the United States could argue the "border crisis" is an emergency, but I don't think that is very convincing.
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To clarify, I would say that there are various "emergencies in international relations" right now -- Syria, Israel/Palestine, the whole Middle East, the South China Sea. The United States could cite to any of these and probably many others. But the steel/aluminum import restrictions would then need some connection to the emergency, and here the U.S. argument would probably fail.
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As the text is currently written, the Canadian interpretation may be a plausible interpretation, but the provision seems vague to me. Ultimately, how you or I or the Canadians reads it may be less important than how Lighthizer reads it. If USMCA passes, we will find out! If I were drafting a provision designed to implement the Canadian interpretation, I would have suggested something like this: "The roster shall be appointed by consensus. Its term shall last for at least three years. After three years has elapsed, the roster shall remain in effect until the Parties constitute a new roster." An even better approach might have just been not to have a minimum, like this: "The roster shall remain in effect until the Parties constitute a new roster."
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Thanks! Is that agreement available somewhere? I don't see it in the usual places.
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