April 8th, 2021

Article 2 Of The Trims Agreement


The views expressed in this article are personal and should not be attributed to the WTO or its member states. The World Trade Organization: Legal, Economic and Political Analysis, 437-483 | The provisions of Sections XXII and XXIII of the 1994 GATT, as developed and applied in the Dispute Settlement Agreement, apply to consultations and dispute resolution under this agreement. All exemptions under the 1994 GATT apply, if applicable, to the provisions of this agreement. … It appears that the justification outlined above with respect to Articles 2.1 and 2.2 of the TRIPS AGREEMENT and Article III:4 of the 1994 GATT would apply mutatis mutandis to the relationship between Articles XI:1 and XI:2 of the 1994 GATT. However, we do not need to clarify this issue definitively in this case, as we have already found that the application of Article III, paragraph 8, point a) of the 1994 GATT is not excluded if the impugned measure enters the scope of Article 2. 2 and paragraph 1, point a), from the ADPIC illustration list. For the above reasons, we believe that the panel rightly rejected the European Union`s argument that Article III, paragraph a, of GATT 1994 did not apply to measures within the scope of Article 2.2 of the TRIPS agreement and the attached list of figures. That is why we criticised the group`s comment in point 7.121 of the panel`s reports, that “paragraph 1, point a) of the indicative list attached to the TRIPS agreement d [id] does not exclude the need to examine [the group] if the measures under attack fall outside the scope of Article III:4 of GATT 1994 as a result of the application of Article III:8 A) of GATT 1994.” … 4.

During the transition period, a member cannot change the terms of a TRIM that he or she notifies under paragraph 1, in order to increase the degree of inconsistency with Article 2, based on the conditions in force on the date of the WTO agreement. Article 2.2 refers to the duty of indental treatment under Article III, paragraph 4, of the 1994 GATT and the general elimination of quantitative restrictions under Article XI, paragraph 1 of the 1994 GATT, provided for in Article III, paragraph 4, of the 1994 GATT. Article 2.2 also refers to a clear list of TRITs in the appendix of the TRIPS AGREEMENT. The term “illustrative” indicates that the examples on the list are not a closed list. In other words, there may be other types of TRIM incompatible with the article III:4 national treatment obligation and the general obligation to eliminate the quantitative restrictions under Article XI:1 of the 1994 GATT. The use of the term “include” in paragraph 1 of the illustrative list continues to support this understanding. Article 2.1 of the TRIPS agreement prohibits members from applying a TRIM – that is, an investment measure related to the trade of goods – “incompatible with Article III or Article XI of the 1994 GATT.” Cross-references to Article 2.1 in Article III of the 1994 GATT are not qualified. We consider this to be a reference to Article III of the 1994 GATT in its entirety, including Article III:4. As the panel explained, a measure inconsistent with Article III:4 of the 1994 GATT would also be a TRIM incompatible with Article 2.1 of the TRIPS agreement.

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