GATT一般例外條款於WTO入會議定書之適用可能性

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National Chiao Tung University

Institute of Technology Law

Thesis

The Applicability of GATT Art. XX in WTO Accession

Protocol

GATT 一般例外條款於 WTO 入會議定書之適用可能

性

Student: Yi-Ting Chen

Advisors: Dr. Kuei-Jung Ni & Dr. Tsai-fang Chen

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The Applicability of GATT Art. XX in WTO Accession Protocol

GATT 一般例外條款於 WTO 入會議定書之適用可能性

Student: Yi-Ting Chen

研究生：陳怡婷

Advisors: Dr. Kuei-Jung Ni & Dr. Tsai-fang Chen

指導教授：倪貴榮博士、陳在方博士

A Thesis

Submitted to Institute of Technology Law

College of Management

National Chiao Tung University

in partial Fulfillment of the Requirements

for the Degree of

Master

of

Laws

July, 2013

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Abstract

WTO Accession Protocol (AP), a legal instrument concluded between the WTO and new Member at the time of accession, has received more and more attention recently because it no longer functions as a confirmation of compliance with the existing WTO disciplines, it starts to contain Member-specific substantive obligations that deviate from the existing WTO rules. China’s AP and Russia’s AP are cases in point.

When being found violating the obligations under the AP, acceding Members purport to invoke general exceptions under the GATT as a defense, claiming to pursue a non-trade policy objective. This defense stirs up lots of discussions. The most important and thorny issue in this matter is the applicability of GATT Art. XX in the AP. That is, whether GATT Art. XX can extend its application beyond the GATT and justify a violation in a separate agreement under the WTO, i.e. the AP. This is the focus of this thesis.

The applicability matter has been addressed in two recent cases, China – Publications

and Audiovisual Products and China – Raw Materials. WTO judiciary has made a major shift

in its attitude, from avoiding this question to providing an answer. However, the reasoning and ruling in these two cases receive many critiques from the academia.

This thesis will firstly provide background knowledge of the AP and GATT Art. XX with an aim to illuminate the relationship between these two. Then, a detailed account of

China – Publications and Audiovisual Products and China – Raw Materials will be presented,

along with some comments. Finally, this thesis proposes that AP obligations that are related to or built upon the obligations under the GATT should be treated like GATT obligations, including the recourse to GATT Art. XX defense.

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Keyword: GATT Art. XX, General Exceptions under the GATT, Applicability, Accession

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Chapter 1 Introduction

Section 1 Motive and Purpose of Research

This thesis aims to provide a thorough research on the applicability of GATT Art. XX in the Accession Protocol (the AP). This is a very controversial and complex issue because it concerns Members’ regulatory autonomy to promote non-trade interests, policy of the WTO, legal nature of the AP and relationship between the AP and GATT Art. XX. Unfortunately, not much research and attention are directed to this area. Accordingly, this thesis hopes to explore this uncharted territory and provide some thoughts.

This issue has grown more and more important in practice and thus studies on the applicability issue is desperately needed. As the AP starts to contain substantive obligations, not just a confirmation of compliance with the existing WTO rules, WTO Members start to bring claims under the AP and respondents often try to justify the breach by invoking GATT Art. XX. The AP of China and the AP of Russia are great examples. Given that China and Russia are active players in international trade, it is sure that the applicability of GATT Art. XX in the AP will become a quite recurrent issue in the WTO dispute settlement system.

In fact, after a long technical avoidance, recently the WTO judiciary finally has decided to come face to face to this matter. In two recent cases, China – Publications and

Audiovisual Products and China – Raw Materials, the WTO judiciary takes a stance on this

matter. However, the reasoning and ruling of these two cases stir up lots of debate and discussion in academia. As a result, this thesis intends to analyze these two cases, provide a detailed account of scholars’ opinion and present its own view.

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Research on the applicability of GATT Art. XX in the AP has strong implication for other non-GATT agreements. Applying GATT Art. XX in other non-GATT agreements encounters similar predicaments. For example, when Members provide environmental subsidies that are inconsistent with the Agreement on Subsidies and Countervailing Measures (SCM Agreement), can such violation be justified by GATT Art. XX (g) as a measure relating to the conservation of exhaustible natural resources? Also, can Members invoke GATT Art. XX (a), measures necessary to protect public morals, to justify a health or safety restriction that are in violation of Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement) or Agreement on Technical Barriers to Trade (TBT Agreement)? This thesis can also provide some guidance to the availability of GATT Art. XX in other non-GATT agreements.

Section 2 Research Method and Structure of the Present Thesis

A. Research Method

In Part I, this thesis conducts a research on the background knowledge of the applicability issue, such as the purpose and function of GATT Art. XX, obligations under the AP and the relationship between the GATT and the AP, by studying books, periodicals and publications from WTO.

Part II focuses on the only two cases in the current WTO judiciary, i.e. Chain –

Publications and Audiovisual Products and China – Raw Materials. This Part closely

analyzes and comments on the reasoning and rulings of the Panel and AB Reports in these two cases. This Part thoroughly includes comments and suggestions on these Reports from scholars. Considering these comments and suggestions, the thesis presents its own comments and suggestions.

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Part III proposes an overall solution to this issue. This Part are based on the studies of the prior parts, i.e. background knowledge of GATT Art. XX, the AP and the relationship between the GATT and the AP, two WTO cases and comments from scholars. This Part tries to put forth a proper treaty interpretation by analyzing interpretative methods listed in the Vienna Convention on the Law of Treaties (VCLT) Art. 31 and 32, such as textual interpretation, contextual interpretation, object and purpose of the treaty and circumstances of the conclusion.

B. Structure of the Present Thesis

This thesis is divided into three parts. Part I, which contains Chapter 2 and Chapter 3, aims to introduce basic knowledge of the AP and GATT Art. XX. Such understanding will help illuminate the applicability of GATT Art. XX in the context of the AP. Chapter 2 will provide background knowledge of the AP, including the formation of the AP, the unique nature of the obligations of the AP and the relationship between the AP and GATT Art. XX. In Chapter 3, GATT Art. XX will be introduced from the perspective of the AP. This Chapter will argue that GATT Art. XX is of systemic importance in the WTO regime and the application scope of GATT Art. XX is not limited to the violation of the GATT.

Part II will present and comment on the only two cases in WTO jurisprudence that deal with the applicability of GATT Art. XX in the AP. There are two Chapters in Part II, Chapter 4 and 5. Section 1 of Chapter 4 will make a detailed description of the Panel and AB Reports in China – Publications and Audiovisual Products. Section 2 will include critiques of

China – Publications and Audiovisual Products, along with some suggestions. Chapter 5 also

contains two sections. Section 1 will make a close account of China – Raw Materials and Section 2 will cover critiques of China – Raw Materials and make some suggestions.

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The last part, Part III, will propose a solution to the applicability matter. There is one Chapter in this Part, Chapter 6. This Chapter puts forth a proposal that GATT Art. XX is applicable when the AP obligations are related to or built upon the obligations under the GATT. Chapter 6 argues that interpreters should not solely rely on the text of the AP and a contextual reading is of crucial importance. Also, the object and purpose of the treaty and the circumstances of conclusion should be taken into consideration. Furthermore, conflicts of norms will not occur.

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Part I

BACKGROUND

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Chapter 2 WTO Accession Protocol

Section 1 Introduction

In order to determine whether GATT Art. XX is an available defense against violation of the AP, it is imperative to understand the nature and characteristic of the obligations under the AP. It is the unique nature of the AP obligations makes the applicability issue more complicated and controversial. This chapter aims to provide background knowledge of the formation of the AP and the origin of the AP obligations that deviate from the regular WTO law. Also, this chapter will provide a close scrutiny of the AP obligations by categorizing them into obligations that are more stringent than the regular WTO rules, so-called WTO-plus obligations, and obligations that are less stringent than the regular WTO rules, so-called WTO-minus obligations. This thesis will focus on WTO-plus and WTO-minus obligations under the AP because their deviation from general WTO law posts a great interpretative challenge to the applicability of GATT Art. XX. Importantly, this basic knowledge provided in this chapter will greatly help elucidate the relationship between the AP and the WTO Agreement and consequently provide guidance to the applicability of GATT Art. XX in the AP.

Section 2 WTO Accession Process – the Birth of the Accession Protocol

When a country wishes to accede to the WTO, the applicant government first needs to file an application to the Director-General of the WTO, stating its desire to accede to the WTO under Art. XII of the WTO Agreement. Art. XII lays down the basic rules for accession:

Article XII

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1. Any State or separate customs territory possessing full autonomy in the conduct of its external commercial relations and of the other matters provided for in this Agreement and the Multilateral Trade Agreements may accede to this Agreement, on terms to be agreed between it and the WTO. Such accession shall apply to this Agreement and the Multilateral Trade Agreements annexed thereto.

2. Decisions on accession shall be taken by the Ministerial Conference. The Ministerial Conference shall approve the agreement on the terms of accession by a two-thirds majority of the Members of the WTO.

3. Accession to a Plurilateral Trade Agreement shall be governed by the provisions of that Agreement.1

After receiving the application, the Director-General will consider the request and establish a Working Party.2 The Working Party consists of any interested WTO Members and mandates to examine the application and finally produces a Working Party Report and a draft AP. The Working Party will firstly examine the factual information provided by the applicant country on its trade regime. A series of questions will be addressed to the applicant country, if there is any unclarity on the factual situation of the trade regime. The questions raised by the Working Party and the answers provided by the applicant country will be documented as Factual Summary of Point Raised and this document will eventually form a part of the Working Party Report.3

1_{Marrakesh Agreement Establishing the World Trade Organization art. XII, Apr. 15, 1994, 1867 U.N.T.S. 154}

[hereinafter the WTO Agreement].

2_{WORLD TRADE ORGANIZATION & ARIF HUSSAIN, A HANDBOOK ON ACCESSION TO THE WTO 3 (2008).} 3_Id.

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After scrutinizing the trade regime of the applicant country, the Working Party will start to negotiate terms of accession with the applicant country. Thus, in addition to complying with the WTO Agreement and the Multilateral Trade Agreements annexed to the WTO Agreement, applicant country will need to abide by the terms of accession, which vary from country to country. Negotiation on terms takes place in three main parts. First, the commitments on rules are negotiated multilaterally with the Working Party itself. The results will be contained in the AP itself or in the relevant paragraphs in the Working Party Report, which will subsequently be incorporated by reference in the AP. These commitments might go beyond or fall behind the regular provisions of the WTO as there is no limitation or rule on the level of commitments. Second, agricultural domestic support and export subsidies commitments are discussed plurilaterally with interests Members in the Working Party and the results will be brought to the Working Party for approval. These results will be contained in Part IV of the Goods Schedule. Third, bilateral negotiation on concessions on goods and specific commitments on services will be conducted with interested Working Party Members. The results of the bilateral negotiation will be reviewed by the Working Party and included in the Goods and Services Schedule.4 In addition, bilateral negotiation might be held to deal with issues that are normally discussed in a multilateral context. All the above-mentioned negotiation proceeds simultaneously.5

After the negotiation on terms of accession, the Working Party will produce a Working Part Report, covering the results of negotiation.6_{The Report will summarize the discussion}

and commitments accepted by the applicant country and end with recommendations. The Report will include a draft AP as an annex setting out terms agreed by the applicant country to

4_{Id. at 3–4.} 5_{Id. at 39.}

6_{Tokio Yamaoka, Analysis of China’s Accession Commitments in the WTO: New Taxonomy of More and Less}

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accede to the WTO and the obligations in the AP will be an integral part of the WTO Agreement. Also, the Report will annex a draft General Council/Ministerial Conference Decision inviting the applicant country to accede to the WTO.7 Furthermore, applicant’s Schedule of Concessions and Commitments on Goods and its Schedule of Specific Commitments on Services will be annexed to the AP. The AP provides that these Schedules shall become Schedules of the GATT and GATS, respectively.8

The Working Party Report will be submitted to the General Council/Ministerial Conference for adoption.9 After approving the text of the draft AP and the Decision, the General Council/Ministerial Conference will adopt the Decision and the Working Party Report as a whole, including the Schedules on Goods and Services.10_{When the Decision is}

adopted, WTO Members offer terms of accession to the applicant country.11 Applicant country accepts those terms by accepting the AP.12 After accepting the AP, the applicant country will become a Member of the WTO thirty days after its acceptance.13

Section 3 Obligations in the Accession Protocol – Deviation from General WTO Law

There are mainly two types of obligations under the AP. One is the market access commitments and the other is the commitments on rules. Market access commitments consist of individual commitments to reduce trade barriers on goods and services and are contained in the Schedule of Concessions and Commitments on Goods and the Schedule of Specific Commitments on Services. These two Schedules are annexed to the GATT and GATS,

7_{WORLD TRADE ORGANIZATION & HUSSAIN, supra note 2, at 44.} 8_{Id. at 45.}

9_{General council meets more frequently than Ministerial Conference. General Council meets once every six to}

eight weeks, while Ministerial Conference convenes at least once every two year. Id. at 13.

10_{Id. at 46.} 11_{Id. at 4.} 12_{Id. at 47.} 13_Id.

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respectively. Thus, the Schedules are an integral part of the GATT and GATS. Since market access commitments are inherently country-specific, the notion of WTO-plus or WTO-minus does not apply to such commitments.14 Also, market access commitments on goods are included in a Schedule annexed to the GATT, and thus are made an integral part of the GATT. Therefore, the applicability of GATT Art. XX will not be a problem.15

On the other hand, commitments on rules refer to the general obligations to comply with the WTO rules, such as the WTO Agreement, the GATT and the GATS. To avoid a fragmented set of rules on trade and the consequences of grandfather clause in GATT era, the Uruguay Round established a single undertaking understanding.16 Thus, WTO Members all follow a uniform set of rules. WTO Members had made efforts to preserve this uniformity by using a standardized form of the AP.17 The standardized AP only contains market access commitments and confirmation on compliance with existing and uniform WTO rules and does not contain obligations that is different from the WTO rule.18 Thus, in early WTO era, the commitments on rule used to be quite unified, with very few and minor exceptions.19 However, the situation has significantly changed since the accession of China. Commitments on rules start to differ greatly in the acceding Member’s AP and cover various subject matters, which causes problems on interpretation and especially the application of general exceptions

14_{Julia Ya Qin, The Challenge of Interpreting “WTO-PLUS” Provisions, 44 J. WORLD TRADE 127, 128 (2010).} 15_{The Panel in China – Raw Materials states that “[i]f China’s export duties commitments were part of China’s}

GATT 1994 Schedule, the general defences of Article XX of the GATT 1994 would be available to justify potential violations.” Panel Report, China – Measures Related to the Exportation of Various Raw Materials, ¶7.140, WT/DS394/R, WT/D395/R, WT/D398/R (July 5, 2011) [hereinafter China – Raw Materials Panel Report].

16_OLIVIER_CATTANEO_&_CARLOS_PRIMO_{BRAGA, EVERYTHING}_YOU_ALWAYS_W_{ANTED TO}_KNOW_ABOUT_WTO

ACCESSION (BUT WERE AFRAID TO ASK) 28 (World Bank, Policy Research Working Paper, November 1, 2009).

17_{Julia Ya Qin, “WTO-plus” Obligations and Their Implications for the World Trade Organization Legal System,}

37 J. WORLD TRADE 483, 487–88 (2003).

18_{Mitali Tyagi, Flesh on a Legal Fiction: Early Practice in the WTO on Accession Protocols, 15 J. INT. ECON.}

LAW 391, 420 (2012).

19_{Qin, “WTO-plus” Obligations and Their Implications for the World Trade Organization Legal System, supra}

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under the GATT. This thesis will focus on commitments on rules and refer to this type of commitments generally as the AP obligations.

Due to the lack of specificity in Art. XII of the WTO Agreement, many commitments on rules in the AP begins to deviate from the regular WTO rules. Art. XII provides that a State or a separate customs territory may accede to the WTO Agreement on terms to be agreed between it and the WTO. There is no limitation or rule on the construction of terms of accession. Thus, there is room to agree on terms that deviate from the ordinary WTO law.20 Moreover, a standardized provision of the AP further boosts this practice.21 That standardized provision makes reference to particular paragraphs in the Working Party Report and incorporates those paragraphs into part of the AP. Consequently, the commitments that go beyond the regular WTO rules under the Working Party Report become part of the AP obligations. Sometimes, the obligations are less stringent than the regular WTO law and are referred to as WTO-minus obligations. However, more often, the obligations extend beyond those in the WTO Agreement and are called WTO-plus obligations.22

The definitions of WTO-plus and WTO-minus obligations have been slightly different from scholar to scholar. While the common understanding of WTO-plus obligations is the obligations that go beyond what regular WTO law asks for and WTO-minus obligations refer to the obligations require less than the ordinary WTO law, this broad and general definition is far from clear. Thus, scholars try to specify and categorize these obligations. While assessing China’s AP, Qin considers provisions that impose more stringent disciplines than required by the Multilateral Trade Agreement WTO-plus commitments, whereas provisions that weaken

20_{Id.; Yamaoka, supra note 6, at 111.}

note 17, at 488.

22_{See generally Cattaneo & Braga, supra note 16, at 18. This practice is subject to severe criticisms, see WORLD}

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the existing WTO disciplines and reduce the right of China WTO-minus commitments.23 With respect to China’s AP, WTO-plus commitments range from disciplines on transparency, judicial review, sub-national government, to foreign investment, national treatment of foreign investors, economic reform, government procurement, and compliance review.24 On the contrary, WTO-minus commitments cover primarily trade remedies. In sum, Qin understands WTO-plus obligations as those expand WTO rules of conduct and WTO-minus obligation as those revise the existing WTO rules.25

Yamaoka provides a more detailed classification on WTO-plus and WTO-minus obligations. Yamaoka finds the terms “plus” and “minus” unclear because they can have different meanings when viewed from different perspectives.26_{That is, a WTO-plus obligation}

for an acceding Member may be a WTO-minus obligation for incumbent Members.27 Hence, Yamaoka sets forth four categories: 1. More stringent obligations to an acceding Member compared with the WTO Agreement. This category can be further divided into a. commitments that are covered by the WTO Agreement, such as commitments on industrial subsidies in China’s AP, and b. commitments that go beyond the scope of the WTO Agreement, such as export concessions and liberalization on trading rights in China’s AP.28_2.

Less stringent obligations to an acceding Member compared with the WTO Agreement. This category aims to accommodate the situation in a transitional economy, such as a grace period to eliminate non-tariff measures or to apply national treatment on certain products.29 3. More stringent obligations to incumbent Members compared with the WTO Agreement. This

note 17, at 490.

24_{See for a detailed examination on these commitments, id. at 491–509.} 25_{Id. at 490.}

26_{Yamaoka, supra note 6, at 117–18.} 27_{Id. at 118.}

28_{Id. at 126–36.} 29_{Id. at 136–37.}

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commitments rarely occur.30 4. Less stringent obligations to incumbent Members compared with the WTO Agreement. This is a new type of obligations. Examples are the transitional product-specific safeguard mechanism and the transitional textile safeguard mechanism in China’s AP.31_{Moreover, Yamaoka observes that China’s AP contains many market economy}

provisions that bear no comparison in the WTO Agreement and thus those provisions do not fall into those four categories.32

Charnovitz provides a new perspective on assessing WTO-plus and WTO-minus obligations and creates a new category. Charnovitz first clarifies that there are no rights but obligations under the WTO law.33 Then, Charnovitz proposes that to assess the AP obligations, one needs to determine the legal baseline of the obligations of WTO membership. Charnovitz thus proposes a new typology of the AP obligations. Similar to that of Yamaoka, Charnovitz also provides four types: 1. Applicant WTO-plus obligations; 2. Applicant WTO-minus obligations; 3. Incumbent WTO-plus obligations; and 4. Incumbent WTO-minus obligations. Charnovitz observes that a provision in Taiwan’s AP constitutes an incumbent WTO-plus obligation, which occurs rarely. The provision is under “Taiwan Special Exchange Agreement,” which is annexed to Taiwan’s AP, provides that “exchange contracts which involve the currency of any Member or Chinese Taipei and which are contrary to the exchange control regulations of that Member or Chinese Taipei maintained or imposed consistently with the Articles of Agreement of the Fund or with the provisions of a special exchange agreement entered into pursuant to paragraph 6 of Article XV of the General Agreement 1994 or this Special Exchange Agreement, shall be unenforceable in the territories

30_{Id. at 137.} 31_{Id. at 137–38.}

32_{Id. at 118–19, 122–25.}

33_{Steve Charnovitz, Mapping the Law of WTO Accession, in WTO GOV. DISPUTE SETTL. DEV}_{. CTRIES. 855, 867}

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of Chinese Taipei or in the territories of any Member.”34 Charnovitz sees that this provision imposes a new obligation on incumbent Members not to enforce such contracts in their own territory and thus this provision constitutes an incumbent WTO-plus obligations. 35 Furthermore, aside from the four categories, Charnovitz creates another new category that increases or decreases obligations on the WTO itself. Charnovitz finds that it is possible for the WTO to take on greater or fewer obligations than it otherwise has to its existing Members, because the AP is an agreement between the acceding Member and the WTO.36 Charnovitz considers that a provision in the Special Exchange Agreement under Taiwan’s AP imposes a greater obligation on the WTO itself, which provides that “whenever the WTO consults with the Fund on exchange matters or in other appropriate cases particularly affecting Chinese Taipei, the WTO shall take measures, as are satisfactory to the Fund, to ensure effective presentation of Chinese Taipei’s case to the Fund, including, without limitation, the transmission to the Fund of any views communicated by Chinese Taipei to the WTO.”37

However, Charnovitz cannot find an example of obligations that impose fewer obligations on the WTO.38

Based on the classification provided by Yamaoka and Charnovitz, this thesis begins to examine the obligations under Taiwan’s AP. Aside from the two obligations mentioned by Charnovitz, Taiwan’ AP contains some applicant WTO-plus and applicant WTO-minus obligations, too. As for applicant WTO-plus obligations, Taiwan agrees that it would permit advertising for alcoholic beverages in all media, subject to regulation in relation to the content

34_{Taiwan Special Exchange Agreement art. II:3.} 35_{Charnovitz, supra note 33, at 872.}

36_{Id. at 873.}

37_{Taiwan Special Exchange Agreement art. VI:3.} 38_{Charnovitz, supra note 33, at 873.}

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and timing of advertising.39 Also, although the GATT does not prohibit the use of tariff rate quotas, a practice that allows a specific quantity of the product concerned to be imported at a lower rate of import duty than is charged on out-of-quota imports, Taiwan commits that tariff rate quotas will not be imposed on industrial products other than passenger cars, light commercial vehicles and certain fish products and tariff rate quotas on passenger cars, light commercial vehicles and certain fish products will be removed over an eight year transitional period.40 As for applicant WTO-minus obligations, transitional period is the most common one. For example, Taiwan states that it will eliminate the import ban on passenger cars equipped with diesel engines two years after the accession to the WTO.41

In sum, these categorizations clearly describe various kinds of the AP obligations. To correctly interpret the AP obligations, it is important to identify the nature of the AP obligations. That is, interpreters need to examine if the AP obligations deviate from the regular WTO law. To do this, one needs to firstly identify the baseline or benchmark of the AP obligations.42 Comparing with the basic WTO rules, interpreters then can determine if the AP obligations constitute plus or minus obligations. It is not easy to recognize WTO-plus and WTO-minus obligations because the language in the AP does not clearly specify the relationship between the AP obligations and the regular WTO law. Also, it is hard to discern between obligations that merely confirm the existing WTO rules and obligations that add to or diminish the existing WTO rules. In sum, identifying the characteristics of the AP obligations is an important step for treaty interpretation and further assessment of the applicability of GATT Art. XX.

39_{Protocol on the Accession of the Separate Customs Territory of Taiwan, Penghu, Kinmen and Matsu, ¶ 12,}

WT/L/433 (Nov. 23, 2001) [hereinafter Taiwan’s AP].

40_{Taiwan’s AP, ¶ 61; WORLD TRADE ORGANIZATION & HUSSAIN, supra note 2, at 73–75.} 41_{Taiwan’s AP, ¶ 71; Charnovitz, supra note 33, at 880.}

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Section 4 Relationship Between the Accession Protocol and GATT Art. XX

To correctly interpret the AP obligations and assess the applicability of general exceptions under the GATT, it is imperative to understand the relationship between the AP and GATT Art. XX. The only provision under the AP that might be able to shed light on the relationship is paragraph 1.2 of the AP. This standardized paragraph states that “this Protocol, which shall include the commitments referred to in paragraph ___ of the Working Party Report, shall be an integral part of the WTO Agreement.”43_{The most important question is}

how the AP should be integrated into the WTO Agreements. The understanding on this integral clause will help elucidate the relationship between the AP and GATT Art. XX.

The first task is to interpret the term “integral part.” The ordinary meaning of an integral part can be defined as a part that is “necessary to make a whole complete” and is “included as part of a whole rather than supplied separately.”44_{This definition clearly points}

out that an integral part is a constituent part, instead of a separate part, of a whole. Thus, upon this definition, the AP is a constituent part of the WTO Agreements. When interpreting a Member’s WTO obligations, the AP and disciplines under the WTO Agreements should be read together as a whole.

Integral clauses have been used in various WTO legal texts. It appears in GATT Art. II:7, which states that “the Schedules annexed to this Agreement are hereby made an integral part of Part I of this Agreement.”45_{Thus, when interpreting Part I of the GATT, interpreters}

should not ignore the Schedules annexed to the GATT. Also, GATT Art. XXXIV provides that

43_{E.g., Taiwan’s AP, ¶ 1.2.}

44_{OXFORD DICTIONARIES ONLINE (Oxford U. Press 2012).}

45_{General Agreement on Tariffs and Trade art. II:7, Apr. 15, 1994, Marrakesh Agreement Establishing the World}

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“the annexes to this Agreement are hereby made an integral part of this Agreement.”46

Therefore, the GATT should be read together with its annexes as one instrument. Moreover, Art. II:2 of the WTO Agreement states that the agreements and associated legal instruments included in Annexes 1, 2 and 3 are integral parts of this Agreement. Hence, the institutional agreement is read together with the multilateral agreements to develop a unified trading mechanism. Consequently, by the same token, scholars propose that the AP being an integral part of the WTO Agreement denotes that it should be read together with the WTO Agreement, including the multilateral agreements. As the GATT is one of the multilateral agreements, the AP should be read with the GATT.47 To construe otherwise will render the AP a separate part of the WTO Agreements and disconnect the AP from the WTO trading system.48

Kennedy suggests a more precise reading on the integral clause. Kennedy finds that the annexes to GATT contain a cross-reference indicating the relationship between the annexes and the relevant provisions under the GATT.49 For example, in ANNEX I of the GATT, each notes and supplementary provisions clearly indicates the relevant provisions in the body of the GATT. Also, Kennedy observes that the first four annexes to the Agreement on Agriculture specify the relevant provisions in the body of text.50 Moreover, Kennedy indicates that the first annexes to the SPS Agreement and the TBT Agreement contain definitions of terms and thus relate to each respective agreement as a whole. Based on this

46_{GATT 1994 art. XXXIV.}

47_{Hua Liu, Comment on the Invocation of Article XX for Violation of Para.11.3 in China—Raw Materials, 3}

BEIJING LAW REV. 152, 155 (2012); Bin Gu, Applicability of GATT Article XX in China – Raw Materials: A

Clash Within the WTO Agreement, J. INT. ECON. LAW, 16–17 (2012).

48_{Gu, supra note 47, at 17.}

49_{Matthew Kennedy, The Integration of Accession Protocols into the WTO Agreement, 47 J. WORLD TRADE 45,}

60 (2013).

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observation, he proposes that the AP should be read together with relevant provisions in the WTO Agreements as one instrument.51

Kennedy further finds support in the procedures for the consideration of waivers of the WTO obligations. Waivers are granted either by the institutional WTO Agreement or the multilateral agreements annexed to the institutional WTO Agreement. Thus, a Member who wishes to request a waiver can either file a request to the Ministerial Conference or to the relevant Council, depending on what the obligations concern. Consequently, with respect to waivers of the AP obligations, Members can either file a request under the institutional WTO Agreement or the multilateral agreements annexed to the institutional WTO Agreement. Kennedy observes that in practice, waivers concerning the staged implementation of tariff concessions, export duties and customs valuation under the AP have been filed to the Council on Trade in Goods, instead of the Ministerial Conference. 52 Kennedy considers this procedural practice confirms his view that these obligations bear a close relationship with relevant obligations under the multilateral agreements. Accordingly, the AP obligations should be read with relevant provisions under the WTO Agreement, including the multilateral agreements.

Kennedy then elucidates how to discern “relevant” provisions. Kennedy notes that sometimes the AP refers to specific provisions or subject matters under the WTO Agreement. Thus, those specific provisions or the provisions under the same subject matters are the relevant provisions and should be read together with that AP obligations. Liu also considers that the AP should be read together with provisions dealing with the same subject matter.53 Thus, it is possible that the AP obligations should be read with provisions under different

51_{Id. at 60–61.} 52_{Id. at 65.}

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agreements. With regard to the AP obligations that do not have a corresponding obligations in the WTO Agreements, Kennedy proposes that interpreters can employ the “clearly discernable, objective link” test provided by the AB in China – Publications and Audiovisual Products, even though such test aimed to solve a different issue in that case.54 Hence, if the AP obligations that are not covered by the WTO Agreements present a clearly discernable, objective link to certain provisions of the WTO Agreement, the AP obligations should be read together with that provisions as a whole.

This thesis agrees with Kennedy’s and Liu’s argument that the AP should be read with relevant provisions under the WTO Agreement. Indeed, the text in the integral clause is not clear enough to demonstrate the systemic position of the AP within the WTO regime. The structure of the WTO legal texts is set out in the Annex 1 of the WTO Agreement and the AP is not included in the Annex 1. Thus, it is difficult to define how the AP is integrated into the WTO legal structure. Given that the subject matters of the AP cover various substantive obligations across the WTO law, this thesis suggests that the relationship between the AP and the WTO Agreement depends on the specific provisions under the AP. This thesis agrees with the scholars that when an AP obligation is based on or related to obligations under the WTO Agreement, that AP obligation is an integral part of the related agreement and should be read together with that agreement. Consequently, each AP obligation is situated under a specific agreement and should be read with that related agreement together as one instrument. On this view, when the AP obligations are related to or based on the obligations under the GATT, those AP obligations will become an integral part of the GATT and should be read with the GATT, including GATT Art. XX. Hence, GATT Art. XX is an available exception to those AP obligations.

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Chapter 3 GATT Art. XX from the Perspective of the Accession Protocol

Section 1 Introduction

In pursuit of free trade, WTO Members may still promote non-trade interests under the WTO regime. GATT Art. XX enables Members to adopt measures that pursue a confined list of public objectives, even though such measures might have negative effects on trade. GATT Art. XX demonstrates Members’ choice of value that promotion of certain public non-trade interests may take precedence over trade interest. However, the question is whether this value still holds true in the context of the AP. To answer this question, it is crucial to have a basic understanding of the purpose and function of GATT Art. XX and the systemic position of GATT Art. XX.

Section 2 Purpose and Systemic Importance of GATT Art. XX

GATT Art. XX provides general exceptions to trade facilitation obligations:

Article XX: General Exceptions

Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where the same conditions prevail, or a disguised restriction on international trade, nothing in this Agreement shall be construed to prevent the adoption or enforcement by any contracting party of measures:

(a) necessary to protect public morals;

(b) necessary to protect human, animal or plant life or health;

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(d) necessary to secure compliance with laws or regulations which are not inconsistent with the provisions of this Agreement, including those relating to customs enforcement, the enforcement of monopolies operated under paragraph 4 of Article II and Article XVII, the protection of patents, trade marks and copyrights, and the prevention of deceptive practices;

(e) relating to the products of prison labour;

(f) imposed for the protection of national treasures of artistic, historic or archaeological value;

(g) relating to the conservation of exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption;

(h) undertaken in pursuance of obligations under any intergovernmental commodity agreement which conforms to criteria submitted to the CONTRACTING PARTIES and not disapproved by them or which is itself so submitted and not so disapproved;

(i) involving restrictions on exports of domestic materials necessary to ensure essential quantities of such materials to a domestic processing industry during periods when the domestic price of such materials is held below the world price as part of a governmental stabilization plan; Provided that such restrictions shall not operate to increase the exports of or the protection afforded to such domestic industry, and shall not depart from the provisions of this Agreement relating to non-discrimination;

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(j) essential to the acquisition or distribution of products in general or local short supply; Provided that any such measures shall be consistent with the principle that all contracting parties are entitled to an equitable share of the international supply of such products, and that any such measures, which are inconsistent with the other provisions of the Agreement shall be discontinued as soon as the conditions giving rise to them have ceased to exist. The CONTRACTING PARTIES shall review the need for this sub-paragraph not later

than 30 June 1960.55

GATT Art. XX recognizes Members’ need to adopt policies that pursue interests other than trade and such policies might adversely affect trade.56_{With an aim to preserve Members’}

regulatory autonomy, GATT Art. XX provides Members space to promote a list of policy objectives. Thus, GATT Art. XX intends to reconcile trade facilitation with other societal values and interests, trying to strike a balance between these two.57 Members may violate their obligations to liberalize trade in pursuit of those policy objectives, provided such measures do not constitute arbitrary discrimination or a disguised restriction on international trade.58 This provision clearly acknowledges that certain public policies that pursues non-economic societal interests may take precedence over the objectives of trade liberalization.59

Although GATT Art. XX is situated under the GATT, the value enshrined in it has systemic implication in the WTO regime. This is firstly because of its inherent nature. As recognized by the AB in China – Publications and Audiovisual Products, the right to regulate

55_{GATT art. XX.}

56_{SIMON LESTER ET AL., WORLD TRADE LAW: TEXT, MATERIALS AND COMMENTARY 363 (2nd ed. 2012); Michael}

Ming Du, The Rise of National Regulatory Autonomy in the GATT/WTO Regime, 14 J. INT. ECON. LAW 639 (2011).

57_{PETROS MAVROIDIS, TRADE IN GOODS 615 (2012).} 58_{GATT art. XX chapeau.}

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trade is an inherent right, rather than a right bestowed by international treaties. Thus, the right to invoke GATT Art. XX is an inherent right to WTO Members and should not be lightly denied. Interpreters should not easily presume that GATT Art. XX is inapplicable. Such presumption should be made when it is supported by explicit language in the agreement.

Moreover, the fact that GATT Art. XX is included in the very first draft of the GATT, the London Draft, suggests that drafters highly valued the need to promote public non-economic interests. Furthermore, the position and the general language of GATT Art. XX indicates its systemic significance. The GATT includes fundamental principles of the WTO regime, such as the most-favored-nation treatment and national treatment. Besides, the GATT also mentions several important subjects of WTO, for example, safeguard measures, subsidies, anti-dumping, etc. At the time when the GATT was the only multilateral trade agreement, GATT Art. XX provides that all the violation in the GATT can be justified by GATT Art. XX. It is worth noting that GATT Art. XX possesses a universally defensible characteristic.

Section 3 Application Scope of GATT Art. XX Is Not Limited to the GATT Violation

The scope of GATT Art. XX receives more and more attention in the WTO judiciary and academia. The availability of GATT Art. XX in agreements other than the GATT is a thorny issue because GATT Art. XX specifically points out that nothing in “this Agreement” shall be construed to prevent the adoption or enforcement of certain measures. This issue was not envisaged at the time of drafting in that the GATT was the only multilateral trade agreement.60_{As more and more multilateral trade agreements add to the WTO framework, the}

applicability of general exceptions under GATT Art. XX becomes less clear.61

60_{LESTER ET AL., supra note 56, at 364.} 61_Id.

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The reference to “this Agreement” in the chapeau of GATT Art. XX leads to two different readings. The narrow reading sticks to the text, “this Agreement,” and argues that only violation under the GATT can be justified by GATT Art. XX. This reading refers to negotiating history to support this narrow interpretation. Although the phrase “this agreement” is taken directly from the original GATT 1947, the drafters could have changed “this Agreement” to “WTO law” or “the multilateral agreements on trade in goods” during the Uruguay Round or expanded the scope in the General Interpretative Note to Annex 1A of the WTO Agreement.62 But they did not. As a result, the narrow reading considers that the negotiating history suggests a deliberate omission. That is, applying GATT Art. XX beyond the scope of the GATT runs afoul of what the Uruguay Round negotiators actually contemplated.63

On the contrary, the broad reading suggests that the applicability of GATT Art. XX should not be limited to the GATT. Scholars propose several different reasons. Among them, Liu advances that sometimes “the words mean something other than what they appear to mean.”64_{Liu cites the First Amendment of the U.S. Constitution as an example. The First}

Amendment states that “congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof.” Liu observes that “even the most ardent strict constructionist understands that the amendment also applied to the President or the courts”65

In addition, Liu finds that even the Panel itself expanded the interpretation of a treaty term. In the Panel report of China – Raw Materials, when examining “in conformity with the GATT 1994” under paragraph 11.1 and 11.2 of China’s AP, the Panel expanded the GATT to “WTO

62_{Danielle H. Spiegel-Feld & Stephanie Switzer, Whither Article XX? Regulatory Autonomy Under Non-GATT}

Agreements After China-Raw Materials, 38 YALE J. INT. LAW ONLINE 16, 20 (2012); Fernando Piérola, The

Availability of a GATT Article XX Defence with Respect to a Non-GATT Claim: Changing the Rules of the Game?, 5 GLOB. TRADE CUST. J. 172, 172 (2010).

63_{Spiegel-Feld & Switzer, supra note 62, at 20–21.} 64_{Liu, supra note 47, at 154.}

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obligations.”66_{Due to these reasons, Liu advances that “this Agreement” should also include}

agreements concluded afterwards on tariffs and trade.67

A recent amicus curiae submission to the Panel in Canada – Renewable Energy also agrees with the broad reading. Even though this amicus curiae brief means to argue that GATT Art. XX is available as a defense against breaches of the SCM Agreement, its reasoning can still lend some support in the context of beaches of the AP. The amicus curiae brief suggests that there is no clear ordinary meaning on “this Agreement” now because this term was constructed prior to the Uruguay Round, when the GATT 1947 was the primary multilateral trade agreement.68 When the term was rewritten into the GATT 1994, no consideration was given as to its new place as one of many multilateral agreements on goods. This amicus curiae brief thus proposes to interpret the reference of “this Agreement” in light of today’s systemic position of GATT Art. XX and the link of the GATT 19994 to other multilateral trade agreements.69 Furthermore, this amicus curiae brief finds support from the AB report of Brazil – Desiccated Coconut, which ruled that the meaning of “this Agreement” in Art. 32.3 of the SCM Agreement refers not only to the SCM Agreement, but also Art. VI of the GATT. Hence, this amicus curiae submission puts forth that the meaning of this Agreement is not inherently limited to the agreement that it is used in.70 In addition, the amicus curiae brief refers to negotiating history of GATT Art. XX to confirm the broad reading. Art. 37 of the London draft, which later became the chapeau of GATT Art. XX, did not yet refer to “this Agreement” but to “undertakings in Chapter IV of this Charter relating to

66_{China – Raw Materials Panel Report, ¶ 7.138.} 67_{Liu, supra note 47, at 155.}

68_{Amicus Curiae Submission on International Institute for Sustainable Development (IISD), Canadian}

Environmental Law Association (CELA) and Ecojustice Canada (Ecojustice) to the panel in Canada –

Renewable Energy, 13, 10 May 2012 [hereinafter the amicus curiae brief in Canada – Renewable Energy].

69_{The amicus curiae brief in Canada – Renewable Energy, 13.} 70_{The amicus curiae brief in Canada – Renewable Energy, 13.}

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import and export restrictions.”71_{The reference of “this Agreement” was later introduced in}

the Geneva Conference by the Benelux and French delegations to expand the application of general exceptions to disciplines in GATT Art. III, VI and XVI. As a result, the amicus curiae brief finds the negotiating history infers that the reference to “this Agreement” means to broaden the application of GATT Art. XX.72

Qin also supports a broad reading yet with different reasons. This thesis resonates with Qin’s argument that the text of GATT Art. XX cannot hinder its application under the AP. According to Qin, whether GATT Art. XX is applicable to non-GATT agreements relies not on the language of the GATT, but rather on the agreements between the parties. Qin convincingly elucidates her argument with an example that if two countries that are not WTO Members agree to include GATT rules in their free trade agreement, the scope of application of the GATT will not hinder such inclusion and application in their free trade agreement.73 Likewise, whether GATT Art. XX is available in the AP should be determined by the intention of the parties to the AP. Their intention can be ascertained from the context of the AP, not from the GATT provision itself.74_{Accordingly, the reference to “this Agreement” in GATT}

Art. XX will not hinder the application of GATT Art. XX in non-GATT agreements.

Moreover, reasoning of China – Publications and Audiovisual Products and China –

Raw Materials also indicates the WTO judiciary looked to the text of the AP provision at

issue to determine the application of GATT Art. XX. The WTO judiciary looked at the textual link contained in the text of the AP provision at issue to affirm the applicability of GATT Art. XX in the AP. For instance, in China – Publications and Audiovisual Products, China violated

71_{The amicus curiae brief in Canada – Renewable Energy, 16.} 72_{The amicus curiae brief in Canada – Renewable Energy, 16-17.}

73_{J. Y. Qin, Pushing the Limits of Global Governance: Trading Rights, Censorship and WTO Jurisprudence--A}

Commentary on the China-Publications Case, 10 CHIN. J. INT. LAW 271, 299 (2011).

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paragraph 5.1 of China’s AP, which provides that without prejudice to China’s right to regulate trade in a manner consistent with the WTO Agreement, China all enterprises in China shall have the right to trade in all goods throughout the customs territory of China, except for those goods listed in Annex 2A and 2B. The AB looked to the introductory clause of paragraph 5.1 of the AP to assess the applicability of GATT Art. XX.75_{Accordingly, the}

reference to “this Agreement” in GATT Art. XX will not bar its application under the AP because the applicability issue depends on the text of the AP.

In sum, the reference to “this Agreement” under GATT Art. XX cannot obstruct applying GATT Art. XX outside the scope of the GATT. GATT Art. XX may still be applied in non-GATT context. As a result, the applicability of GATT Art. XX in the AP will not be hindered because of the reference to “this Agreement” under GATT Art. XX.

75_{Appellate Body Report, China–Measures Affecting Trading Rights and Distribution Services for Certain}

Publications and Audiovisual Products and Audiovisual Entertainment Products, ¶216, WT/DS363/AB/R (Dec.

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Part II

THE APPLICABILITY OF GATT ART. XX IN THE ACCESSION

PROTOCOL

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Chapter 4 An Analysis of China – Publications and Audiovisual Products

Section 1 Summary of the Dispute

China – Publications and Audiovisual Products sheds some light on whether the

violation of one agreement can be excused by the exception regulated in another agreement, even though these two agreements are within the purview of the WTO Agreement. In this case, China conducted several measures restricting the importation and distribution of audiovisual products, including reading materials, audiovisual products, sound recordings, and films for theatrical release. The Panel and the AB found many of these measures inconsistent with the trading rights commitments contained in China’s Accession Protocol. In response, China argued that the inconsistency could be justified by the exception provision contained in another separate agreement, i.e., Article XX (a) of the GATT 1994. After examining the introductory clause of paragraph 5.1 in China’s AP, the AB approved the applicability of the exceptions of the GATT 1994, meaning that China can invoke exceptions in one agreement, in this case the GATT 1994, to justify the violation of a different agreement, i.e., China’s AP.

This case is important for two main reasons. First, it deals with a very controversial issue: whether a violation in one agreement can be justified by another agreement. There has gathered tremendous attention on the cross agreement application between “covered agreements.” For example, whether violation of the SCM Agreement can be justified by GATT Art. XX, or whether violation of the MFN obligation under the SG Agreement Art. 2.2 can be excused by GATT Art. XXIV. Yet, this case deals with a thornier issue: cross application between “the AP” and “the covered agreements.” That is, whether violation of the AP can be justified by GATT Art. XX. Second, given that there is limited jurisprudence on the obligations of the AP, this case offers some insights into the application of the AP’s obligations and possible defenses against such violation.

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China adopted a series of measures to establish a content review mechanism.76 China considered certain products as “cultural goods” and established a content review mechanism on imported cultural goods, including reading materials, audiovisual products and films for theatrical release.77_{Under the review mechanism, China would prohibit the distribution of}

such products, if the content of the products would have a negative impact on public or individual morals.78 To carry out the content review mechanism effectively and efficiently, China imposed regulations on import entities.79 That is, only “approved” and/or “designated” import entities could import relevant products.80 Take newspapers and periodicals importation for example. Importers must be approved and designated by the authority to import such reading materials.81 To obtain such status, a publication import entity must, inter alia, be a wholly state-owned enterprise and have a suitable organization and qualified personnel.82

Another measure at issue concerned China’s Foreign Investment Regulation. Under China’s Foreign Investment Regulation, foreign investors were only allowed to invest in certain prescribed industry.83_{According to the Catalogue, which listed out prohibited foreign}

investment industries, foreign investment in areas such as the importation of books, newspaper, periodicals, electronic publications and audiovisual products, and audiovisual products was not allowed. 84 The Panel determined that China’s Foreign Investment 76_{Id. ¶ 141.} 77_Id. 78_Id. 79_Id. 80_Id. 81_{Id. ¶ 147.} 82_Id. 83_{Id. ¶ 142.} 84_{Id. ¶ 143.}

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Regulations and the Catalogue led to the result that any foreign-invested enterprise in China was prohibited from importing books, newspaper, audiovisual products, etc.85

In the case, the Panel found that China’s measures violated the trading rights commitments under China’s AP paragraph 5.1.86_{This provision provides that all enterprises in}

China shall have the right to trade in all goods throughout China, except for goods listed in Annex 2A and 2B.87 The phrase “all enterprises in China” in paragraph 5.1 refers to both wholly Chinese-invested enterprises and foreign-invested enterprises that include wholly foreign-owned enterprises and Chinese-foreign joint ventures.88 The protected “right to trade” includes the right to import and export goods, as stated in paragraph 5.1.89 The Panel found that China’s measures requiring that only approved and/or designated import entities could import relevant products and that foreign-invested enterprises in China were prohibited from importing products at issue amount to restrictions of enterprises’ right to trade.90 The explicit exception provided under this provision, Annex 2A and 2B, does not apply, which is not in

85_{Panel Report, China–Measures Affecting Trading Rights and Distribution Services for Certain Publications}

and Audiovisual Products and Audiovisual Entertainment Products, ¶ 7.347, WT/DS363/R (Aug. 12, 2009)

[hereinafter China – Publications and Audiovisual Products Panel Report].

86_{Id. ¶ 7.706.}

87_{Paragraph 5.1 China’s AP provides:}

“Without prejudice to China's right to regulate trade in a manner consistent with the WTO Agreement, China shall progressively liberalize the availability and scope of the right to trade, so that, within three years after accession, all enterprises in China shall have the right to trade in all goods throughout the customs territory of China, except for those goods listed in Annex 2A which continue to be subject to state trading in accordance with this Protocol. Such right to trade shall be the right to import and export goods. All such goods shall be accorded national treatment under Article III of the GATT 1994, especially paragraph 4 thereof, in respect of their internal sale, offering for sale, purchase, transportation, distribution or use, including their direct access to end-users. For those goods listed in Annex 2B, China shall phase out limitation on the grant of trading rights pursuant to the schedule in that Annex. China shall complete all necessary legislative procedures to implement these provisions during the transition period.”

88_{China – Publications and Audiovisual Products AB Report, ¶ 135.}

89_{Protocol on the Accession of the People’s Republic of China, ¶ 5.1, WT/L/432 (Nov. 10, 2001) [hereinafter}

China’s AP].

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dispute in this case.91 Accordingly, the Panel of the case found that the measures violated paragraph 5.1 of China’s AP.

B. Parties’ Arguments

i. China’s Arguments

China did not contest the violation of its trading rights commitments concerning the importation of reading materials and audiovisual products.92 Instead, China argued that the breach of the provision could be justified under GATT Art. XX (a), as the measures were necessary to protect public morals.93 Even though this justification is located in a different agreement, China submitted that the introductory clause of paragraph 5.1 of the Protocol enables the applicability of the GATT exception in the event that a violation of paragraph 5.1 is found.94 The introductory clause of paragraph 5.1 states that the obligation contained in the paragraph 5.1 is without prejudice to China’s right to regulate trade in a manner consistent with the WTO Agreement, and China alleged that this introductory clause enables it to pursue legitimate policy objectives and grants China the right to regulate trade consistent with the WTO Agreement.95_{In addition, China argues that the measures at issue concerned restriction}

on importation and thus were regulating trade.96 Therefore, the measure fell within the coverage of the clause.97 Furthermore, China proposed that the WTO Agreement referred to in

91_{Id. ¶ 7.248.}

92_{China – Publications and Audiovisual Products AB Report, ¶¶ 147, 156.} 93_{Id. ¶ 206.}

94_Id. 95_Id. 96_Id. 97_Id.

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the paragraph 5.1 encompassed the WTO Agreement and all its annexes; hence Article XX of the GATT 1994 was an applicable defense.98

ii. The U.S.’s Arguments

The U.S. objected to China’s interpretation and put forward a different reading of paragraph 5.1.99_{The U.S. proposed that only for products listed in the Annex 2A and 2B of}

the AP can China derogate from its obligation because goods under Annex 2A and 2B are explicitly exempted under paragraph 5.1.100 The U.S. further argued that to read the introductory clause of paragraph 5.1 as suggested by China would permit China to reserve some goods to State trading, render these Annexes superfluous and eliminate China’s trading rights commitments altogether.101_{According to the U.S.’s explanation, China’s right to}

regulate trade does not mean China can completely evade from its obligation to grant trading rights, but simply means that China can employ measures such as import licensing, TBT, and SPS requirements to regulate trade. In the present case, the U.S. claimed that China’s measure goes beyond those examples of regulating trade as provided in paragraph 84 of the Working Party Report. Furthermore, the U.S. opined that measures to regulate trade in paragraph 5.1 refer to measures addressing goods that are being traded, not the traders of the goods.102 Accordingly, the U.S. argued that China could not justify its violation by the introductory clause of paragraph 5.1.103

C. WTO Dispute Settlement Body Reports

98_Id. 99_{Id. ¶ 207.} 100_Id. 101_Id. 102_Id. 103_Id.

GATT一般例外條款於WTO入會議定書之適用可能性

National Chiao Tung University

Institute of Technology Law

Thesis

The Applicability of GATT Art. XX in WTO Accession

Protocol

GATT 一般例外條款於 WTO 入會議定書之適用可能

性

Student: Yi-Ting Chen

Advisors: Dr. Kuei-Jung Ni & Dr. Tsai-fang Chen

The Applicability of GATT Art. XX in WTO Accession Protocol

GATT 一般例外條款於 WTO 入會議定書之適用可能性

Student: Yi-Ting Chen

研究生：陳怡婷

Advisors: Dr. Kuei-Jung Ni & Dr. Tsai-fang Chen

指導教授：倪貴榮博士、陳在方博士

A Thesis

Submitted to Institute of Technology Law

College of Management

National Chiao Tung University

in partial Fulfillment of the Requirements

for the Degree of

Master

of

Laws

July, 2013

Abstract

Table of Contents

Chapter 1

Introduction

Part I

BACKGROUND

Chapter 2

WTO Accession Protocol

Chapter 3 GATT Art. XX from the Perspective of the Accession Protocol

Part II

THE APPLICABILITY OF GATT ART. XX IN THE ACCESSION

PROTOCOL

Chapter 4 An Analysis of China – Publications and Audiovisual Products