Discriminatory Safeguards in the Light of the Admission of the People's Republic of China to the World Trade Organization

Abstract

Discriminatory safeguards underwent a peculiar destiny in the multilateral trading system. Traditionally considered illegal, they have been resorted to in two main instances: in one case to permit developed countries to protect certain sectors of their industry against fierce competition of the developing world, in another to shield the system against potential abuse of the rules and principles of free trade on the part of State-trading countries admitted within the ranks of GATT. The Agreement on Safeguards, while establishing once and for all that traditional safeguard measures have to be applied across the board, nevertheless allows selectivity in certain instances, both directly and indirectly. Furthermore, China's recent Accession Protocol to the WTO includes an outright selective safeguards clause which, consistent with previous State practice, satisfies two functions: it can serve as a guarantee against possible abuse stemming from the still opaque Chinese economic and administrative background and it can also be used to protect the markets of WTO members from too strong Chinese economic competition. Though the special mechanism is framed within a discipline that is clearly derived from that of GATT and the Agreement on Safeguards, it maintains its own particularity which will effectively limit China's full integration into the WTO until 2013, when said mechanism will terminate. Copyright Oxford University Press 2002, Oxford University Press.