WTO ‘National Security’ Ruling Meets Trump

♠ Posted by Emmanuel in , at 3/30/2019 07:36:00 PM
From Crimea to America: considering the plight of "national security" trade barriers.
Here's a heads-up for everyone; over the next few days, the World Trade Organization is expected to rule over Russia hitting the Ukraine with trade sanctions on "national security" grounds [DS512]. In the past, such claims were considered unquestionable by the WTO. However, the expectation now is that the WTO will rule against Russia and in favor of the Ukraine.

You should be asking by now, "What do Russia-Ukraine 'national security' dust-ups have to do with the United States?" Well, it sets a precedent for the WTO proceeding with cases having to do with national security and ruling in favor of the complainant. And, insofar as the United States has hit so many of its trade partners with such claims for limiting imports, the WTO's change of heart would render the US vulnerable to a world...of hurt:
The World Trade Organization is set to rule for the first time on a dispute involving a member’s national security, challenging a key justification for President Donald Trump’s tariffs and putting the arbiter of international trade conflicts on a collision course with the U.S. The WTO will issue a ruling on a case in which Russia imposed trade restrictions on Ukraine, saying they were necessary in the interest of national security, according to an official with knowledge of the report who asked not to be named because the process is private.

The decision could still be appealed or settled outside of the WTO. The ruling confirms the WTO’s authority to determine whether such measures are necessary to protect a country’s security.
The ruling could set up a showdown as US trade partners take it to the WTO dispute settlement mechanism over similar "national security" tariffs:
A WTO ruling on the Russia dispute could force the U.S. to justify why the European Union, Canada, Mexico and a half-dozen other nations that have filed disputes against Trump’s metal tariffs, pose a security threat. “The fact that the panel is actually going to engage in an inquiry of whether there is basis for these national security measures means things are looking really bleak for the U.S.” Nicolas Lamp, a former dispute settlement attorney at the WTO, said in an interview on Wednesday. “For the U.S., this finding could confirm all their worst fears about the WTO.”
To be sure, the isolationist-nationalist Trump would like nothing more than to pull the US out of the WTO, and being taken to court there over "national security" could be the last straw. Then again, Trump is still not the United States, and there may be a more united pushback from the business community and business-minded legislators if Trump threatens WTO withdrawal.

At any rate, the fate of the WTO is going to be shaped a lot over the next few days. Stay tuned.