A Proposal To Expand Judicial Review over Section 232 and 301 Tariffs
For many people in Washington these days, having U.S. trade actions – especially those related to security, but other kinds as well – judged by international tribunals on their consistency with trade agreements is controversial. But what if that judgment of consistency could be done by U.S. courts instead? Here's what I have in mind.
Arguably, Section 232 of the Trade Expansion Act of 1962 and Section 301 of the Trade Act of 1974 have been abused over the last few years. It would be nice to rein these statutes in, and people have made various proposals in this regard: giving Congress a greater role, adding constraints on the executive, and providing for more effective judicial review. I'm going to focus on the last one, with a specific proposal to amend these statutes in order to expand the role of judicial review.
My proposal is that a provision be added to both Section 232 and Section 301 to the effect that they have to be carried out consistently with WTO rules and other trade agreements, and that U.S. courts be given the power to review whether actions under the two statutes are consistent with these international obligations. The language could look something like this:
"Any action taken pursuant to this Section must be in compliance with the international obligations of the United States, including trade agreements implemented into domestic law by Congress. In determining whether actions are in compliance with international obligations, U.S. courts shall apply the treaty interpretation rules of the Vienna Convention on the Law of Treaties."
What this would mean in practice is that U.S. courts would examine whether the tariffs that have been imposed pursuant to these statutes violate (1) the tariff commitments made in a trade agreement, (2) the MFN obligation in the case of the WTO, or (3) any other relevant obligations. They would also look at whether the U.S. government is able to prove that the tariffs are justified under any exceptions it cites.
With respect to the last part, how would U.S. courts interpret and apply exceptions provisions such as GATT Articles XX and XXI? It's hard to say. They could follow the approach taken by WTO panels and the Appellate Body, or they could go off in an entirely new direction.
In an ideal world, the U.S. government attitude towards international trade dispute settlement would shift, and complaints about these sorts of tariffs could be adjudicated at the WTO and under FTAs. Such complaints are not possible at the moment because (1) the WTO is suffering from the U.S. blockage of appointments to the Appellate Body, and (2) if I could speculate a bit, FTA complaints are not being brought because U.S. trading partners fear retaliation or they know the U.S. wouldn't comply with an adverse ruling so it is not worth the effort. We'll see how the next administration approaches these issues, but in the meantime, as an alternative that cannot be so easily disabled, allowing U.S. courts to carry out this type of review could be a compromise and a useful backup in terms of making sure Section 232 and Section 301 are used as they were intended.
At this point, some readers are probably chomping (or is it champing?) at the bit, eager to talk about the following provision of the Uruguay Round Agreements Act:
SEC. 102. RELATIONSHIP OF THE AGREEMENTS TO UNITED STATES LAW AND STATE LAW.
...
(c) EFFECT OF AGREEMENT WITH RESPECT TO PRIVATE REMEDIES.—
(1) LIMITATIONS.—No person other than the United States—
(A) shall have any cause of action or defense under any of the Uruguay Round Agreements or by virtue of congressional approval of such an agreement, or
(B) may challenge, in any action brought under any provision of law, any action or inaction by any department, agency, or other instrumentality of the United States, any State, or any political subdivision of a State on the ground that such action or inaction is inconsistent with such agreement.
As law prof John Barceló puts it, this provision means that "no private or other person, other than the United States, has standing within a U.S. court to invoke a provision of a WTO agreement to challenge actions of the federal government or its agencies." I can see an argument that with regard to the claims of GATT violations that my new judicial review provision would enable U.S. courts to hear, there could be some uncertainty about the relationship of Section 102(c)(1) and the new provision. To address this concern, it might be useful to make clear, as part of the new judicial review provision, that Section 102(c)(1) does not apply to lawsuits brought under this provision.