Further Exceptions

• Author: Jon R. Johnson
• Pages: 261-276

CHAPTE

FURTHER

EXCEPTIONS

The

obligations

set out in

several

WTO

agreements,

as

well

as

NAFTA,

CIFTA,

and

CCFTA

are

subject

to

general exceptions.

The

exceptions

in

Article

XX of

GATT

1994, which have been incorporated

by

reference

into each

of

NAFTA,

CIFTA,

and

CCFTA,

are

discussed

in

chapter

2.

GATT

1994,

the

GATS,

NAFTA,

CIFTA,

and

CCFTA

also contain fur-

ther

exceptions

respecting

national

security

and

balance

of

payments.

NAFTA,

CIFTA,

and

CCFTA contain exceptions respecting cultural

industries.

The

GATS,

NAFTA,

CIFTA,

and

CCFTA contain exceptions

respecting taxation measures,

and the

GATS,

NAFTA,

and

CCFTA con-

tain

exceptions respecting

the

disclosure

of

information.

A.

NATIONAL SECURITY

Article

XXI of

GATT

1994 provides that nothing

in

GATT

1994 will

require

a

contracting party

to

disclose information that

it

considers nec-

essary

to its

essential

security

interests

or

prevents

a

contracting party

from

"taking

any

action which

it

considers necessary

for the

protection

of

its

essential security interests" relating

to

such matters

as

arms

traffic,

supplying military

and

security establishments

and the

non-prolifera-

tion

of

nuclear weapons,

or

"taken

in

time

of war or

other emergency

in

international relations."

GATS

Article

XIVMs,

Article

73 of the

TRIPS

261

9

262

INTERNATIONAL

TRADE

LAW

Agreement,

NAFTA

Article 2102,

CIFTA

Article 10.2,

and

CCFTA

Article

O-02

all

contain similarly worded

exceptions.1

The

difficulty

with assessing

the

scope

of

these exceptions lies

in

their self-judging nature. Other than

CIFTA

Article 10.2,

the

exceptions

are

worded

in

such

a

manner that

it is up to the

government that takes

the

action

to

judge whether

the

action

is

necessary

for the

protection

of

its

essential security interests.

The

U.S. government

has

consistently

taken

the

position that

it is in the

exclusive judgment

of the

government

taking

the

action

to

determine what actions

are

necessary

for the

pro-

tection

of its

essential security interests.

In

U.S.

—

Trade

Measures

Affecting

Nicaragua,2

which involved

a

U.S. embargo

on

trade with Nic-

aragua,

the

U.S. government insisted that

the

panel's terms

of

reference

be so

narrowly defined that

the

panel

was

precluded

from

examining

or

judging

the

validity

of or the

motivation

for the

invocation

by the

United States

of

Article

XXI of

GATT 1947,

the

identically

worded

pre-

decessor

of

Article

XXI of

GATT

1994.

It

is

certainly arguable that these exceptions

are not

open-ended

and

that

there

are

limits

on the

ability

of

governments

to

take actions under

their cover.

As

discussed

in

chapter

2,

exceptions

in

international agree-

ments

are

construed narrowly

and

GATT

jurisprudence

on the

meaning

of

"necessary"

has

concluded that

a

member cannot rely

on an

excep-

tion

to

justify

a

measure

as

necessary

if

less

inconsistent

measures

can

be

employed

to

address

the

problem. Also, while

the

provisions

may be

self-judging

insofar

as the

"actions taken"

in

response

to,

say,

an

"emer-

gency

in

international relations,"

the

self-judging language does

not

apply

to the

question

as to

whether there

is in

fact

an

emergency,

and it

is

clearly arguable that

this

question should

be

assessed

by

objective

standards

and not be

left

to be

judged

by the

government taking

the

1

There

are

slight

differences

in

wording

in all

these provisions. However,

all the

provisions except

for the

Canada-Israel

Free

Trade

Agreement,

in

force

1

January

1997,

see

http://www.dfait-maeci.gc.ca/english/trade/agrement.htm

[CIFTA],

art.

10.2(l)(b),

are

self-judging

in

that they provide that nothing

in the

relevant

agreement

will prevent

the

Party

from

taking actions that

it

considers

necessary

for

the

protection

of its

essential security interests taken

in

time

of war or

other

emergency

in

international relations.

The

CIFTA

version

of

this

provision

in

art.

10.2(b)

is

similar

but

without

the

self-judging

words

"it

considers." There

are

also

national

security exceptions

in the

North America

Free

Trade

Agreement,

17

December

1992, Can. T.S. 1994

No. 2

[NAFTA],

arts.

607

(relating

to

energy

goods)

&

1018 (government procurement),

and in

NAFTA

art.

1603(1)

and

Canada-Chile

Free

Trade

Agreement,

5

July 1997,

see

http://www.dfait-maeci.gc.ca/

english/trade/agrement.htm

[CCFTA],

art. K-03(l), respecting temporary entry.

2

[1986]

GATTPD

LEXIS

1. The

report

of the

panel

is

dated

13

October 1986.