Legal Aspects of International Trade and WTO Law
The argument that Zanobia can raise concerning this dispute is the imposition of discriminatory trade restriction by Richland’s introduction of new regulations confining sales of imported beef to retail shops and banning the sale of imported beef in major supermarket chains. Zanobia will argue that since Richland’s measure restricts imported beef from Zanobia to be sold in major supermarket chains, but allow domestic beef to be sold in major supermarket chains, they are not treating all goods equally within the market using the principle of National Treatment (NT). Zanobia will apply Article III(4) of the General Agreement on Tariffs and Trade 1947 (GATT), which provides that imported products should not be subjected to more stringent regulations, laws, or requirements compared to those applicable to nationally or domestically produced goods.[1] In its plain language, Article III(4) states that “the products of the territory of any contracting party imported into the territory of any other contracting party shall be accorded treatment no less favourable than that accorded to like products of national origin in respect of all laws, regulations, and requirements affecting their internal sale, offering for sale, purchase, transportation, distribution or use.”[2] Zanobia can also apply Article XI of the GATT, which require general elimination of quantitative restrictions, to support its claims.[3]
In response, Richland may rebut Zanobia’s claim using the defense of its obligation to protect the public health regulations. Richland will apply general exceptions under Article XX(b) of the GATT.[4] For Richland to survive scrutiny under Article XX(b), it must prove that the inconsistent regulation of imported beef is deemed necessary “to protect human, animal or plant life or health.”[5] Zanobia will also base its argument against Richland’s restrictive measure under Article XX, which requires measures to be imposed in good faith. Trade restriction measures should not be imposed to protect Richland’s domestic industry or discriminate between the trading partners.[6] The goals or aims of Richland’s regulation is to avoid consumer confusion regarding the source of the beef, but not to protect public health. The regulations will be considered arbitrary and unjustified and do not accomplish the stated goals, restricting trade more than necessary. Therefore, Richland’s regulations will not be justifiable under Article XX of the GATT.
[1] General Agreement on Tariffs and Trade 1947 (GATT), Art. III(4).
[2] Ibid.
[3] Ibid, at Art. XI.
[4] Ibid, at Art. XX(b).
[5] Ibid.
[6] Ibid.