Security Exceptions in the WTO System ‒ A Discussion of the Russia- Traffic in Transit Case and Its Implications for Korea ‒

Abstract

The findings of the panel decision of Russia- Transit (DS512) as to the application of GATT XXI can be summarized as follows: Once Article XXI is invoked by Members in the WTO dispute settlement procedure, the panel has jurisdiction to review the dispute by the application of the provision. Members has a sovereign right to determine the “essential security interests” and a subjective right to find necessary protective measures. The panel still maintains power to review the good faith of Members in the interpretation and application of subjective elements of the clause. Three subparagraphs of XXI:(b) set out objective factors the satisfaction of which should be assessed objectively. “other emergency in international relations” requires graveness of the situation comparable to war and generally disqualifies simple trade and economic conflicts. If Chinese retaliatory measures against Korean installation of THAAD system were brought to the WTO dispute settlement procedure, the measures such as ban on travelling to Korea and boycott of Korean products would be held inconsistent with the WTO Agreements and unable to be justified under security exception clauses as they are not related to the protection of essential security interests. The US is expected to lose the WTO cases concerning its measures on steel and aluminum products unless it adjust the target and latitude of its measures. Meanwhile, it is not as simple to predict the result of the case concerning Japanese measures related to the exportation of products and technology to Korea. Unless the situation get worse, settlement of disputes through negotiation is recommended.