Switzerland challenged the U.S. argument that invoking Article XXI prevents dispute panels from reviewing claims against U.S. tariffs, noting that WTO members could abuse that article to exempt commercial measures from the scope of WTO dispute settlement if there were no possibility of a panel reviewing such a claim.
The U.S. also claimed that reviewing an invocation of Article XXI would undermine the legitimacy of the WTO’s dispute settlement system and the viability of the WTO itself, according to the Geneva source.
The U.S. position is that “the text of Article XXI is clear; each WTO member has the right to determine for itself what it considers to be in its own essential security interests,” the Geneva source said. “This has been the understanding of the U.S. for over 70 years since the negotiation of the GATT, and this understanding has been shared by every WTO member whose national security action was subject of complaint, including WTO members such as the European Union, Canada, Russia and others.”
Panels were established in November pursuant to requests by the EU, China, Mexico, Norway, Canada, Russia and Turkey.
The formation of panels at the requests of Switzerland and India bring the total number of WTO dispute panels reviewing U.S. Section 232 duties to nine.
The U.S. noted that Russia and other WTO members that have imposed retaliatory tariffs on the U.S. are “pretending” that U.S. actions are so-called “safeguards” and “further pretend” that the duties constitute a suspension of equivalent concessions that is allowable under the WTO’s Safeguards Agreement, according to the Geneva source.
The U.S. contended that Russia’s duties are “nothing more” than tariffs in excess of Russia’s WTO commitments and are applied only to the U.S., contrary to the WTO most-favored nation principle.
Russia said U.S. Section 232 duties are, in essence, safeguards, irrespective of how the U.S. characterizes them, according to the Geneva source.
The DSB has established four panels at the request of the U.S. to review the legality of duties imposed by Canada, China, the EU and Mexico on U.S. imports in response to U.S. Section 232 tariffs.