This is a guest post from Ben Heath, Acting Assistant Professor of Lawyering at NYU Law
In Part I of this series, I introduced the idea that the Russia — Transit report embeds a conception of the dispute settlement system as a steward of the WTO rules. As I noted in yesterday’s post, courts adopt a stewardship function by establishing pathways for receiving political signals from affected states (embeddedness), and developing flexible legal doctrines that can be ratcheted up or down in response to those signals (responsiveness). I should add that these are doctrines which the court itself can manage and direct over time (directedness).
To administer a stewardship function, a court requires both a keen sense of its own legal domain and a significant degree of authority to find and characterize the relevant facts. In today’s and tomorrow’s posts, I will identify two critical moves made in the panel report, both of which I think are geared toward securing this flexibility and authority. These moves are necessary predicates to the flexible legal doctrine announced by the court on Article XXI, which I will discuss in Part IV of this series.
In its very first act, the Russia — Transit panel carves out the legal space for itself and future WTO panels to adjudicate sensitive security matters. It does so by deciding not to hold Russia accountable for its internationally wrongful acts in the use of force against, and invasion and annexation of, Ukrainian territory. This was a controversial move by the panel, and it has already been subject to some criticism from those who saw it as overly deferential to Russia. I will argue that, to the contrary, the panel’s decision in this respect operated to strengthen the panel’s claim to authority over trade disputes that are linked to broader international conflicts.
I. The Backdrop
The dispute between Russia and Ukraine over transit restrictions thrust the WTO into complex terrain, not only geopolitically but also legally. The measures challenged by Ukraine (various Russian restrictions on international cargo transit from Ukraine and bound for Kazakhstan or Kyrgyzstan) were adopted in the context of an escalating crisis between the two countries, involving, in particular, the Russian intervention in and annexation of the Crimea.
In the context of WTO law, this backdrop potentially raised the question of Russia’s responsibility for the crisis. Russia’s invocation of the GATT security exception relied on the existence of a “war or other emergency in international relations” between the two countries. The question, then, is whether Russia can escape its GATT obligations by invoking an emergency that, at least in very large part, is of Russia’s own creation. Such a result, it could be argued, offends basic notions of justice and the widely recognized principle that no one should profit from his or her own wrong.
II. The Panel’s Decision
The Russia — Transit panel, in its very first analytical move, declared that it was not interested in being drawn into this broader legal dispute. At Paragraph 7.5, the report states that it is not “this Panel's function to pass upon the parties' respective legal characterizations of those events, or to assign responsibility for them, as was done in other international fora.” The panel then returns to this point as part of its decision that the situation did amount to an international emergency, stating:
7.121. The Panel notes that it is not relevant to this determination which actor or actors bear international responsibility for the existence of this situation to which Russia refers. Nor is it necessary for the Panel to characterize the situation between Russia and Ukraine under international law in general[.]
For those not steeped in public international law terminology, this passage is written in code. The first sentence, by using the phrase “international responsibility,” appears to be stating that the panel will not decide whether Russia breached any of its obligations under general international law (such as Article 2(4) of the UN Charter on the use of force) in its actions vis-à-vis the territory of Ukraine. The second sentence, by using the phrase “characterize the situation,” seems to be saying that the panel is not going to make any authoritative statement about whether the Russia-Ukraine situation amounts to an “armed conflict,” a state of “occupation,” or any other term having legal weight under, inter alia, the law of war.
Two legal results flow from this decision, one explicit and one implicit. The explicit result is that the panel is refusing to make the invocation of GATT Article XXI(b)(iii) contingent on the invoking state’s legal responsibility — a party can invoke the “war” exception even if it started the war. The panel is also implicitly declining to read into Article XXI any requirement that would be similar to Article 25(2) of the Articles on State Responsibility, which provides that a state cannot invoke a situation of necessity under customary international law if that state “has contributed to the situation of necessity.” While this latter test would not directly require passing on a state’s international responsibility for a situation of armed conflict, the net result would be effectively the same.
As a result, the panel is able to find that the measures at issue were “taken in time of war or other emergency in international relations,” notwithstanding Russia’s responsibility for that state of affairs. This would ultimately enable to the panel to find that Russia’s restrictions on transit fell within the security exception.
III. Legal Space and the Stewardship Role
I have already argued that this decision was both legally correct and politically wise. This result is consistent with the text of the exception, which requires only that measures are “taken in time of” war or other emergency in international relations. It also avoids the contrary result, whereby the legality of any trade restriction taken in time of international conflict would require first determining which state is responsible for starting that conflict. Such an approach would effectively privilege one side in any interstate conflict, and it would draw the multilateral trading system into issuing authoritative decisions on precisely the sorts of issues that the security exception was designed to keep out.
This move is thus both legitimacy-preserving and authority-enhancing for the dispute settlement system. The panel is defending against potential attacks on its legitimate role here by making clear that it will not be drawn into broader legal disputes about the legality of a use of force, the existence of a state of belligerent occupation, and so on. It’s signaling that the WTO, which to this point (and perhaps for not much longer) has provided a readily accessible state-to-state dispute settlement mechanism, is not going to be hijacked by one state’s attempt to cloak a geopolitical dispute in trade terms. This framing is thus designed to blunt the attacks of potential critics who would accuse the panel of overstepping its boundaries.
The other side of this coin is that, within the legal space it carves out, the panel is enhancing its authority to interpret and apply the WTO agreements. By declaring that this boundary between trade law and other international legal questions can be preserved, the panel is implicitly rejecting the argument — raised numerous times over the decades — that the GATT/WTO has no role to play when trade is merely epiphenomenal of a deeper geopolitical dispute. Here, the panel is asserting that, whatever the root cause of a trade dispute, questions of trade law can and should be adjudicated within the multilateral trading system.
This result is by no means unique to this panel or to trade law. It echoes a line of cases from international courts and tribunals that decline to dismiss claims on “political question” grounds, some of which are cited in the panel report at note 183. And it resonates deeply with the work and jurisprudence of Sir Hersch Lauterpacht, whose critique of the distinction between “legal” and “political” disputes has worked a profound influence on the profession and practice today.
Nevertheless, this is an important first step to establishing the system’s stewardship role in the context of security measures. In carving out a distinct legal space for it and future panels to work, the Russia – Transit panel is defending the system’s legitimacy and constituting its authority over security measures that affect states’ trade obligations. Although this worked in Russia’s favor in the instant case, it is not a move that should necessarily comfort WTO members seeking carte blanche for their security measures.
Future posts will address the subsequent steps taken by the panel, as well as systemic and normative implications. Before concluding, however, I should emphasize that it is contestable whether the panel was successful in its efforts to create this distinct legal space. In communicating its decision not to appeal the panel report, Ukraine appeared to argue that the report provides support for its assertion that an armed conflict exists between the two countries (see here, in Ukrainian). Indeed, as I will discuss more in the next post, the panel asserted its factfinding authority in a way that brought in many of the same international legal concepts, like armed conflict, that supposedly were not relevant to its legal conclusions. Thus, even as these moves further consolidated the panel’s authority, they may have weakened future panels’ abilities to defend against use of the dispute settlement system for extrinsic political goals.
