GATT/WTO Necessity Analysis: Evolutionary Interpretation and its Impact on the Authority of Domestic Regulation

Abstract

The interpretation of necessity under GATT Article XX(b) and (d) has seen a gradual but significant increase in the regulatory autonomy of WTO members to derogate from their obligations for legitimate policy goals. The basic test of necessity was whether a measure was the 'least trade restrictive' one available. This was narrowly construed, limiting the analysis to trade effects whilst focusing on the purpose of the entire Agreement. Recent interpretations of necessity in the Korea Beef and French Asbestos cases have confined the evaluation exercise to the purpose of the enumerated exception and introduced new elements in the assessment. The emerging practice comprehends the importance of considering, inter alia, the aim of the contested measure, resulting in the proportionality test being applied in the necessity analysis. As a consequence, these developments have expanded the ambit of the domestic regulations, which may arguably be necessary for justification under Article XX.