The balance between 'public morals' and trade liberalization: analysis of the application of article XX(A) of the GATT

• Author: The balance between 'public morals' and trade liberalization: analysis of the application of article XX(A) of the GATT
• Pages: 86-114

FRONTIERS OF LAW IN CHINA

VOL. 14 MARCH 2019 NO. 1

DOI 10.3868/s050-008-019-0005-8

ARTICLE

THE BALANCE BETWEEN “PUBLIC MORALS” AND TRADE LIBERALIZATION:

ANALYSIS OF THE APPLICATION OF ARTICLE XX(A) OF THE GATT

GUANGLIN Qiaozi*

Abstract With the development of the international community, public morals have

attracted increasing attention from states. Nevertheless, the “public morals” exception

clause in Article XX(a) of the General Agreement on Tariffs and Trade (GATT) is hardly

invoked by state parties as a distinct basis for trade-restrictive measures. The EC-Seal

Product dispute is the first case in which the Dispute Settlement Body (DSB) of the World

Trade Organization (WTO) considered this issue, after which it addressed the issue in the

Columbia-Textiles and the Brazil-Taxation disputes. This article aims to analyze the

kinds of public morals that can be justified while implementing trade-restrictive

measures. It proposes that the human rights standard is a significant moral concern and

that human rights law and trade law may be integrated. The article also addresses the

question on the procedures that should be followed in applying Article XX(a) to avoid

abuse. It concludes that Article XX(a) attaches intrinsic importance to striking a balance

between trade liberalization and state sovereignty, for which it must be reserved in the

GATT.

Keywords GATT, Article XX, public morals, trade-restrictive measures, human rights

INTRODUCTION ...................................................................................................................... 87

I. OVERVIEW OF ARTI CLE XX OF THE GATT................................................................ 89

A. Chapeau of Article XX......................................................................................... 90

B. Article XX(b): Protection of Life or Health of Human, Animal or Plant............. 92

C. Article XX(d): Necessary to Secure Compliance with Laws............................... 93

D. Article XX(g): Conservation of Exhaustible Nature Resources .......................... 94

II. APPLICATION OF ART ICLE XX(A) OF THE GATT ..................................................... 95

A. Definition of “Public Morals” ............................................................................ 95

B. Two-Tier Test Establishing Justification under Article XX(a) ............................. 96

* (󰑬) LL.M. in Public International Law, Grotius Centre for International Legal Studies of Leiden

Law School, Leiden University, Leiden, the Netherlands; Legal Consultant, Nixon Peabody LLP, Beijing

100025, China. Contact: qguanglin@outlook.com

The statement and views expressed in this article are my own and do not reflect those of Nixon Peabody

LLP. This article is based on my research toward my LL.M. thesis. I would like to thank Professor Eric De

Brabandere for his insightful comments and useful editorial suggestions during his supervision of my thesis.

2019] THE BALANCE BETWEEN “PUBLIC MORALS” AND TRADE LIBERALIZATION 87

1. The Measure Must Be “Designed” to Protect Public Morals.......................... 96

2. The Measure Must Be Necessary to Protect Such Public Morals.................... 97

III. A FURTHER DISCUSSION OF “PUBLIC MORALS” EXCEPTION.................................. 98

A. Historical Development of “Public Morals” Exception Clause .........................98

1. “Public Morals” as an Exception in Pre-GATT Era ........................................98

2. “Public Morals” in Contemporary Society...................................................... 99

B. Arguments in Favor of “Public Morals” as an Exception Clause Justifying

Trade-Restrictive Measures.............................................................................. 103

1. National Sovereignty .....................................................................................103

2. Intrinsic Importance of “Public Morals”........................................................ 104

C. Types of “Public Morals” and Questions of Its Extraterritorial Application ...104

D. The Difference between “Public Morals” Exception and Other Exceptions.... 106

E. Necessary Evidence to Support Invoking Article XX(a).................................... 107

1. The Text of the Regulations Concerned and the Relevant Legislative

History .......................................................................................................... 107

2. Form of the Measures.................................................................................... 108

3. Opinion Polls and Public Surveys ................................................................. 108

4. Scientific Evidence........................................................................................ 109

5. Religious or Moral Origins of the Measures Concerned............................... 109

F. Integrating Human Rights Law with Trade Law................................................ 110

1. The Definition of “Public Morals” in Human Rights Law............................ 110

2. The Doctrine of the Margin of Appreciation................................................. 111

CONCLUSION........................................................................................................................ 113

INTRODUCTION

With the progress of free trade, people have begun to attach increasing importance to

the moral and ethical problems related to economic development. Can animal welfare be

an exceptional clause to restrictions on free trade? Can a local moral standard such as a

religion or social belief prevail over the Most Favored Nation obligation and the National

Treatment obligations under the World Trade Organization (WTO) regime?

Article XX of the General Agreement on Tariffs and Trade (GATT) stipulates a series

of exceptions that can justify the acts of contracting parties that are inconsistent with the

GATT. Among these exceptions, Article XX(a), namely the “public morals” exception

clause, has hardly been invoked. Although there were plenty of cases concerning Articles

XX(b), XX(d), and XX(g) of the GATT, there had never been a case before the WTO

Dispute Settlement Body (DSB) involving Article XX(a) of the GATT as a distinct basis

to justify trade-restrictive measures, before the EC-Seal Products dispute.1

1 Robert Howse & Joanna Langille, Permitting Pluralism: The Seal Products Dispute and Why the WTO

Should Accept Trade Restrictions Justified by Noninstrumental Moral Values, 37 Yale Journal of International

Law, 368 (2012).