This is a guest post from Antoine Comont, Ph.D Candidate at Laval University and the University of Bordeaux
If respecting international law is a virtue that still makes sense to you, the question for each of the countries affected by the tariffs announced yesterday by the administration is how to justify any retaliation.
The first idea would be to use the WTO DSS to request authorization to suspend certain obligations (Article 22 of the DSU). However, given the scale of the customs duties imposed by the United States, the slowness of the procedures could well cause irreparable damage to the economies of the various countries targeted. Added to this is the fact that the WTO's Appellate Body is currently blocked, and the United States could, in particular, allow the proceedings initiated against it in the appeal phase to lapse without any final decision being taken, thus depriving the complaining Members of their right to request suspensions of concessions or other obligations.
The second idea would therefore be to use the dispute settlement procedures provided for in any regional or bilateral agreements that countries may have concluded with the United States. However, you would be particularly limited as to the extent of the obligations you could suspend. On the one hand, you could suspend the concessions you have granted to the United States under your agreement. On the other hand, as the reciprocal tariffs announced by the United States are particularly significant, you could be led to suspend certain concessions that you have granted to the United States under your bilateral agreement, but also the WTO agreements.
The third idea would be to adopt unilateral countermeasures in a bid to avoid lengthy procedures. In either case, the United States could challenge your measures before the WTO's DSB because they nullify or impair certain advantages acquired under Article I and II of the GATT or any other WTO agreement[i]. However, you will not be able to justify your measures because the United States has previously violated its obligations under the WTO agreements. This would be contrary to the DSB's exclusive jurisdiction under Article 23 of the DSU, which prohibits the use of unilateral measures or any measure that has not been expressly authorized by it.
Given the unprecedented scale and violence of the tariffs applied by the United States, is there any way of responding immediately without infringing international law? In general international law, retaliatory measures are certainly unfriendly measures, but they are not incompatible with any international obligation. Conversely, countermeasures are measures incompatible with certain international obligations but justified by the fact that they are a reprisal for a previous violation of international law[ii].
Under WTO law, compensation (mutually agreed) or suspension of obligations granted by the DSB are retaliatory measures and are specifically authorized by Article 22 of the DSU. At the same time, we found that the per se prohibition of countermeasures is the subject of consistent jurisprudence by the DSB. The panel also made the following statement about Section 301:
« Article 23.1 is not concerned only with specific instances of violation. It prescribes a general duty of a dual nature. First, it imposes on all Members to "have recourse to" the multilateral process set out in the DSU when they seek the redress of a WTO inconsistency. In these circumstances, Members have to have recourse to the DSU dispute settlement system to the exclusion of any other system, in particular a system of unilateral enforcement of WTO rights and obligations. This, what one could call "exclusive dispute resolution clause", is an important new element of Members' rights and obligations under the DSU. Second, Article 23.1 also prescribes that Members, when they have recourse to the dispute settlement system in the DSU, have to "abide by" the rules and procedures set out in the DSU. This second obligation under Article 23.1 is of a confirmatory nature: when having recourse to the DSU Members must abide by all DSU rules and procedures. »[iii]
We are therefore also of the opinion that only sanctions authorized by the DSB and expressly provided for in the Memorandum can be implemented. This implies the prohibition of any unilateral sanction or reprisal.
It therefore seems clear that the WTO's dispute settlement rules and procedures are no longer suited to the context of the generalised trade war launched by the US. So let us see what options can still be mobilized to address the needs of WTO Members.
I. Excluded Legal Grounds
A. Self-defence
In public international law, self-defence is grounded in Article 51 of the UN Charter.
Article 51
Nothing in the present Charter shall impair the inherent right of individual or collective self-defence if an armed attack occurs against a Member of the United Nations, until the Security Council has taken measures necessary to maintain international peace and security. Measures taken by Members in the exercise of this right of self-defence shall be immediately reported to the Security Council and shall not in any way affect the authority and responsibility of the Security Council under the present Charter to take at any time such action as it deems necessary in order to maintain or restore international peace and security.
In order to lawfully exercise a right to self-defence under Article 51 of the UN Charter, three criteria must be fulfilled: (1) there must be an armed attack, (2) it must be necessary to use force in the exercise self-defence, and (3) the use of force in self-defence must be proportional.
To date, no court has upheld the invocation of self-defence in response to economic coercive measures. The term ‘armed’ excludes any economic dimension, and while legal scholars remain divided on its scope, no case addressed this matter yet. Historically, the International Court of Justice has consistently interpreted self-defense as having a military connotation, far removed from the economic and commercial reality of U.S. actions so far.
Even if a special group welcomes this argument, the second difficulty with self-defence is that recourse to it would at the same time justify recourse to Article XXI of the GATT by the United States, since this would mean recognizing the existence of serious international tensions.
B. Vienna Convention on the law of treaties, Article 62
Article 62 of the Vienna Convention on the law of treaties is related to the « fundamental change of circumstances ».
Article 62
Fundamental change of circumstances
1. A fundamental change of circumstances which has occurred with regard to those existing at the time of the conclusion of a treaty, and which was not foreseen by the parties, may not be invoked as a ground for terminating or withdrawing from the treaty unless:
(a) the existence of those circumstances constituted an essential basis of the consent of the parties to be bound by the treaty; and
(b) the effect of the change is radically to transform the extent of obligations still to be performed under the treaty.
2. A fundamental change of circumstances may not be invoked as a ground for terminating or withdrawing from a treaty:
(a) if the treaty establishes a boundary; or
(b) if the fundamental change is the result of a breach by the party invoking it either of an obligation under the treaty or of any other international obligation owed to any other party to the treaty.
3. If, under the foregoing paragraphs, a party may invoke a fundamental change of circumstances as a ground for terminating or withdrawing from a treaty it may also invoke the change as a ground for suspending the operation of the treaty.
Regarding the commentaries provided by the ILC on the draft articles on Responsibility of States, it can be considered equivalent to the excuse of necessity (see below)[iv]. Even if it can be argued that US tariffs would fundamentally change the initial circumstances that led to counter-measures, we do not believe it would be appropriate to base the justification for our response on this ground.
On the one hand, recourse to Article 62 of the VCLT marks the premise of the denunciation of the WTO Agreement vis-à-vis the United States, which is certainly not desirable.
On the other hand, even though paragraph 3 authorizes the suspension of an agreement, there are questions[v] as to whether this suspension must imperatively apply to all agreements or whether it can merely be partial.
II. The plea of « necessity » (État de nÉcessitÉ) or the « excuse of necessity »
A. What is the « plea of necessity »
In accordance with the ILC, « the term “necessity” (état de nécessité) is used to denote those exceptional cases where the only way a State can safeguard an essential interest threatened by a grave and imminent peril is, for the time being, not to perform some other international obligation of lesser weight or urgency ».
This is a customary principle of public international law widely established in case law[vi]. Since then, an initiative to codify the state of necessity is contained in article 25 of the ILC's draft articles on State responsibility :
Article 25
Necessity
1. Necessity may not be invoked by a State as a ground for precluding the wrongfulness of an act not in conformity with an international obligation of that State unless the act:
(a) is the only way for the State to safeguard an essential interest against a grave and imminent peril; and
(b) does not seriously impair an essential interest of the State or States towards which the obligation exists, or of the international community as a whole.
2. In any case, necessity may not be invoked by a State as a ground for precluding wrongfulness if:
(a) the international obligation in question excludes the possibility of invoking necessity; or
(b) the State has contributed to the situation of necessity.
Regarding on the level and scope of the tariffs that will be applied by the United States, we can conceive that without government action, the economy of WTO Members would find themselves in a situation of grave and imminent peril (in the meaning of article 25.1 (a)) and that it is ‘necessary’ in their nation's interests to act as quickly as possible without waiting for the DSB to authorize the adoption of sanctions.
B. What is not the « plea of necessity »
It seems to us that it is interesting to specify what a “plea of necessity” is not, insofar as such a justification requires, in our opinion, terminological clarification.
The “plea of necessity” is not a retaliation or countermeasure. Such measures are designed to sanction breaches of international law that have already occurred (in the WTO context, to sanction measures that are incompatible with the WTO agreements). The plea of necessity makes it possible to respond not to measures, but to exceptional circumstances, to a serious and imminent peril facing the economy of WTO Members. In this regard, we believe that it is possible for the government to legally justify its additional tariffs as, regardless of the blatant inconsistency of the US tariffs, it is no longer a matter of adopting a sanction, but of facing up to a grave and imminent peril.
C. The application of the plea of necessity in trade law
Our argument is that the tariffs applied by the US create circumstances that render necessary for other Members to safeguard their essential interests against a grave and imminent peril.
The question is whether or not general principles and customary rules of public international law apply in the specific field of international economic law[vii]. There is no doubt the plea of necessity finds its place in WTO Law.
One of the four conditions of validity of the plea is that necessity may not be invoked by a State as a ground for precluding wrongfulness of an act if the circumvented international obligation excludes the possibility of invoking necessity.
WTO Law does not exclude the possibility of invoking the plea of necessity. But the only dilemma is to determine whether certain provisions of the WTO Agreements (Article XXI, Safeguards Agreement...) constitute a form of lex specialis that would derogate from the general principle, as these provisions are somewhat in the same spirit: temporarily protecting essential interests against the effects of trade.
On that point, we consider the plea of necessity is different from the national security exception found notably in GATT Article XXI and GATS Article XIV bis. The security exception can be invoked by a trading State if its “essential security interests” are at stake. In WTO Law, it is generally left to every Member to define what it considers to be its essential security interests. But, as the panel in Russia-Traffic in Transit (2019) stated:
The discretion of a Member to designate particular concerns as ‘essential security interests’ is limited by its obligation to interpret and apply Article XXI(b)(iii) in good faith[viii].
Article XXI must not be an instrument to circumvent trade obligations. The Panel in the Russia- Transit case insisted that a Member should re-label trade interests in ‘essential security interests’. As Van den Bossche and Zdouc brilliantly summarize:
(…) the further an ‘emergency in international relations’ is removed from armed conflict or a breakdown of law and order, the greater the specificity required in the articulation of the ‘essential security interests’ at issue[ix].
To use the plea of necessity, a State must satisfy the conditions developed by customary international law and codified in Article 25 of the ILC's draft articles on State responsibility. These conditions are different from those set under Article XXI of the GATT and Article XIV bis of the GATS. So we do not consider that the national security exception constitutes a lex specialis vis-à-vis the excuse of necessity. However the situation remain unclear regarding the Safeguards Agreement.
Concluding Remarks and Communication Tools
The plea of necessity appears to us to be the best legal instrument.
It must be emphasized that pleading necessity should not be seen as a response to the measures taken by the United States, but rather to the situation in which the economy would find itself. It would therefore not be a question of taking reprisals or countermeasures against the United States. Here, the high level of the duties applied and their scope, which are, unprecedented in the history of the GATT/WTO, make it necessary for WTO Members to rescue their economies, which are facing a grave and imminent peril.
Moreover, building the political narrative around necessity is fairly straightforward for citizens and policy-makers to understand. This approach also offers a completely new legal argument that has never been argued in WTO law. This approach seems to offer a sufficiently solid political narrative and legal argument to preserve Member's devotion to a rules-based multilateral trading system.
NB : Joost Pauwelyn has also explored other ideas.
[i] This is what the United States did concerning the measures taken by Canada in response to the American tariffs on steel and aluminum in 2018. See Canada - Additional Duties on Certain Products from the United States - Request for the establishment of a panel by the United States WT/DS557/2.
[ii] ILC, p128
[iii] US – Section 301 Trade Act, WT/DS152/R para 7.43See also, US – Countervailing measures on certain EC products, WT/DS212/AB/R para 6.37 and EC – Commercial Vessels, WT/DS301/R para 7.198.
[iv] ILC, p 83
[v] Such questions were raised before a WTO Panel to which it didn’t respond, see US – Section 301 Trade Act, WT/DS152/R para 4.74.
[vi] See for instance, Gabcíkovo-Nagymaros Project (see footnote 27 above), pp. 40– 41, paras. 51–52 ; Fisheries Jurisdiction (Spain v. Canada), Jurisdiction of the Court, Judgment, I.C.J. Reports 1998, p. 432 ; Russian Indemnity case UNRIAA, vol. XI (Sales No. 61.V.4), p. 421, at p. 443 (1912)… For a more detailed list of relevant case law, see ICL page 80 et seq.
[vii] Andimariam. Chapter 10
[viii] Para. 7.132
[ix] Van Den Bossche and Zdouc (2022), p. 678
