WTO: 2016 NEWS ITEMS

SAFEGUARD MEASURES


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DISCLAIMER:

This news item was prepared by the WTO’s Information and External Relations Division under its own responsibility and is designed to help the public understand developments in the WTO. While every effort has been made to ensure the contents are accurate, it does not prejudice member governments’ positions.

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Japan, Brazil, Canada, Australia, the United States, Korea, Chinese Taipei, the European Union, Hong Kong (China) and China all voiced concerns about the increasing number of safeguard actions being notified to the committee for review.  Many of these members raised the same concerns at the last Safeguards Committee meeting in April.

Members reviewed safeguard investigations involving 26 products, including 17 steel products. 

Japan said oversupply in steel due to expansion of capacity in some members had triggered a rise in trade remedy measures globally. Both the United States and Korea said safeguard measures should be used with great caution, especially given their chilling effects on international trade.  The EU cited the “skyrocketing” number of safeguards targeting steel imports and urged members to consider more targeted measures, such as anti-dumping duties, to address specific producers causing problems.

Several of the members that intervened acknowledged the right of members to resort to safeguards, but that this trade remedy was unique in being the only one to target “fairly” traded imports (in contrast, anti-dumping and countervailing measures targeted “unfairly” traded imports).  Thus, caution was needed, and governments should ensure that any actions were taken in strict accordance with WTO rules.

The Safeguards Committee reviewed notifications of safeguard actions taken by Chile, China, Egypt, India, Indonesia, Jordan, the Kyrgyz Republic, Malaysia, Morocco, the Philippines, South Africa, Ukraine, Viet Nam, Zambia and the Gulf Cooperation Council.

Under the WTO's Safeguards Agreement, a member may restrict imports of a product temporarily (take “safeguard” actions) through higher tariffs or other measures if its domestic industry is seriously injured, or threatened with serious injury, due to a surge in imports.  An import surge justifying safeguard action can be a real increase in imports; or it can be an increase relative to the domestic industry's production, even if the import quantity has not increased.

In principle, safeguard measures apply to all imports and not just those from a particular country (developing countries accounting for less than 3% of exports are excluded from a measure).  Because safeguards target “fair” trade, under defined circumstances, an exporting country can seek compensation for lost trade through consultations or, if no agreement is reached, it can raise tariffs on exports from the country that is enforcing the safeguard measure.

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