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Contents

Contributors

Introduction: The Law and Economics of Contingent Protection: An Introduction to the Volume

1 Preferential Trading Agreements: Friend or Foe?

1. Member Countries

1.1. Trade Effects

1.2. Why Join a PTA – and with Whom?

1.3. Investment

1.4. Industrial Location and Growth

1.5. “Deep Integration”

2. Excluded Countries

3. PTAs and the Trading System

3.1 Millstones

3.2. Stepping-Stones

3.3. Equilibrium Tariff

3.4. Trade Negotiations

3.5. Depth and Breadth in Integration

References

The “Legalization” of GATT Article XXIV – Can Foes Become Friends?

Introduction

1. Regional Trade Law and Economics – “Friends or Foes”?

2. The Troublesome Development Dimension

3. “Legalization” Arrives

4. Doha Round Transparency Developments

5. Recent Dispute Developments, Brazil–Tyres

5.1 The EC Points of Attack

5.2. The Appellate Body Ruling on Article XX

6. Conclusion: On to the Future

2 Third-Country Effects of Regional Trade Agreements

1. Introduction

2. Theoretical Foundations for Trade Diversion and Trade Policy

3. Empirical Evidence on Trade Diversion and Trade Policy

4. Evidence on Diversion and Trade Liberalization in RTAs

5. Conclusion

References

3 Contingent Protection Rules in Regional Trade Agreements

1. Introduction

1.1. Brief Introduction of the Issues

1.2. Survey of Analytical and Policy Discussions Surrounding Trade Remedies

1.2.1. Why Are Trade Remedies Needed in RTAs?

1.2.2. Legal Issues Surrounding Trade Remedies in RTAs

1.2.3. Demand for Trade Remedies in RTAs

1.2.4. Welfare Effects of Trade Remedy Provisions in RTAs

2. RTAs Included in the Mapping

2.1. Key Economic Characteristics of the RTAs

2.2. Other Stylized Facts

3. Methodological Approach to the Mapping

3.1. Review of Previous Approaches to Examining Contingent Protection Rules in RTAs

3.2. Benchmarks (Templates) Used for the Mapping

3.2.1. Introduction

3.2.2. Antidumping

3.2.3. Countervailing Duties

3.2.4. Safeguards

4. Analysis

4.1. Patterns and Correlations across RTAs

4.2. Hubs and Spokes

4.3. Abolishing Trade Remedies in RTAs

5. Conclusions

References

3.1 Commentary on “Contingent Protection Rules in Regional Trade Agreements”

Introduction

1. General Comments

2. NAFTA, Chapter 19

3. Miscellaneous Observations

4 The Limits of PTAs: WTO Legal Restrictions on the Use of WTO-Plus Standards Regulation in PTAs

1. Introduction

2. National TBTSPS Measures, PTA Disciplines on National TBTSPS Measures, and Multilateral Trade: Friends or Fortresses?

2.1. National and PTA TBTSPS Measures as Barriers to Trade

2.2. Potential Threats to Multilateral Trade

2.2.1. Discriminatory or Unnecessary Harmonized Rules

2.2.2. Discriminatory Access to Benefits of Negative Integration

2.2.3 Discriminatory Access to Benefits of Internal Mutual Recognition

2.3. Potential Benefits to Multilateral Trade

2.3.1. PTA-Driven “Autonomous” TBTSPS Liberalization

2.3.2. The “Lock-In” Effect

2.3.3. “Parallel Processing” in Reduction of Nontariff Barriers

2.3.4. PTAs as “Laboratories” of Integration

2.4. The Building Blocks versus Stumbling Blocks Analysis of TBTSPS Measures

2.5. Market-Access-Based Analysis

3. The Relationship among Article XXIV and GATT, the TBT Agreement, and the SPS Agreement

3.1. Article XXIV

3.2. The Relationship between Article XXIV and the TBT Agreement and SPS Agreement

3.3. The Relationship between Article XXIV and Articles I, III, and XI of GATT

3.4. Necessity and Balancing

3.5. Necessity and Article I and III of GATT, the TBT Agreement, and the SPS Agreement

3.6. Is Mutual Recognition a Violation of MFN?

4. The Regional--Multilateral Relationship in the WTO as It Pertains to TBTSPS Measures: Article XXIV and the Understanding

4.1. The Internal Requirement for Customs Union or Free Trade Area Status

4.1.1. What is an “Other Restrictive Regulations of Commerce” under Article XXIV:8(a)(i) and (b)? How does it differ from an “Other Regulations of Commerce” Under Article XXIV:5(a) and (b), and Article XXIV:8(a)(ii)?

4.1.2. The Requirements of Article XXIV:8(a)(i) and Article XXIV:8(b)

4.2. The External Requirement for Customs Union Status

4.3. The Requirement not to Raise External Barriers

4.4. TBT Agreement

4.5. SPS Agreement

4.6. Compare GATS Article VII

5. Conclusion

5 EU and U.S. Preferential Trade Agreements: Deepening or Widening of WTO Commitments

1. Introduction

2. Methodological Issues

2.1. PTAs and the WTO

2.2. The Agreements under Study

2.3. The Coverage of the Agreements

2.4. The Legal Enforceability of Identified Areas

3. WTO+ Areas

3.1. Coverage of WTO+ Areas

3.2. The Enforceability of WTO+ Obligations

3.3. Main Observations Concerning WTO+ Undertakings

4. WTO-X Areas

4.1. The Coverage of WTO-X Areas

4.2. The Enforceability of WTO-X Obligations

4.3. Main Observations Concerning WTO-X Undertakings

5. PTAs and the WTO – More of the Same or Ventures into New Areas?

5.1. Differences in Coverage of EC and U.S. PTAs

5.2. Center of Gravity of EC and U.S. PTAs Adjusted for Legal Enforceability

5.3. In Which Areas Is Legal Inflation Most Pervasive?

5.4. Closing Remarks

6. Conclusion

References

Straightening the Spaghetti Bowl

5.1 Comments on “Beyond the WTO? Coverage and Legal Inflation in EU and U.S. Preferential Trade Agreements”

References

6 Labor Clauses in EU Preferential Trade Agreements – An Analysis of the Cotonou Partnership Agreement

1. Introduction

2. The Changing Shape of EU International Relations

3. The ACP–EU Cotonou Partnership Agreement

4. Concluding Remarks and Ways Forward

7 Do PTAs Actually Increase Parties’ Services Trade?

World Trade Organization

1. The Basic Economics of Trade in Services

2. The Different Liberalization Approaches – From Simple PTAs to Deeper Integration

2.1. GATS-Type Agreements

2.2. NAFTA-Type Agreements

2.3. “Deeper Integration” Agreements

3. An Introduction to the Gravity Equation in International Trade

4. The Gravity Equation and Trade in Services

5. Methodology and Data

6. Estimation Results

7. Concluding Remarks

References

8 A Model Article XXIV: Are There Realistic Possibilities to Improve It?

1 Preferential Trade Agreements in the WTO/GATT System

1.1. The Evolution of PTAs in the WTO/GATT System

1.2. The Control of PTAs in the WTO/GATT System

1.2.1. The Basic Rules of Article XXIV

1.2.2. Review and Oversight of PTAs by WTO Members

1.2.3. Review of PTAs in Dispute Settlement

1.2.4. The Doha Negotiations on PTAs

1.2.5. Summary

2. The Effects of Preferential Trade Agreements on the Multilateral Trading System

2.1. The Economic Effects of PTAs

2.2. Other Effects of PTAs

2.3. The Desirability of PTAs and the Multilateral Trading System Compared

3. Proposals for Enhancing WTO Control of PTAs

3.1. The WTO Report, Sutherland Report, and Warwick Commission

3.2. Clarifications and Modifications to the Text of Article XXIV

3.2.1. Defining “substantially all the trade”

3.2.2. Banning Trade Remedies after Transition Periods

3.2.3. Establishing Tests for Assessing Whether a PTA Raises Barriers to the Trade of Third Parties

3.2.4. Reasonable Period of Time and Exceptional Circumstances

3.2.5. Development-Related Issues

3.2.6. Desirability and Plausibility of Reform Proposals

3.3. Transparency Plus: WTO Control of PTA Dispute Settlement and Expanded Third-Party Participation

3.3.1. WTO Dispute Settlement

3.3.2. Transparency and Participation

4. Conclusion

8.1 Comments on “A Model Article XXIV: Are There Realistic Possibilities to Improve It?”

References

Index