ASSESSMENTS

The WTO Protects Its Power in a Landmark National Security Case

Apr 5, 2019 | 22:57 GMT

The World Trade Organization (WTO) headquarters are seen in Geneva on April 12, 2018. A new WTO panel ruling means countries won't be able to invoke national security concerns at will when imposing trade restrictions on others.

(FABRICE COFFRINI/AFP/Getty Images)

Highlights

A WTO panel has ruled that Moscow was within its rights to block Kiev's access to Russian rail transit over national security concerns, marking the first such decision in the body's history.
But while the panel cleared Russia in this instance, it also stated that it has jurisdiction to decide such cases, implying that countries will have less leeway to cite national security concerns to impose protectionist policies.
This makes it less likely that the WTO will side with the Trump administration on its steel and aluminum tariffs or that the United States will cease blocking appointments to the organization's appellate body, which hears panel appeals.

For 25 years, the World Trade Organization (WTO) has not had to rule on a major national security case; now, however, it has -- and that could set a precedent for all future national security-related cases, including trade disputes launched by U.S. President Donald Trump. On April 5, a WTO panel ruled in Russia's favor that it had the right, under GATT Article XXI, to suspend certain trade concessions to Ukraine that are related to access to Russia's rail networks. In its ruling, the WTO argued that there has been an emergency in international relations between Russia and Ukraine since 2014, meaning Moscow did have the right to sever Kiev's access to the transport links. The decision, however, is not yet final, as Ukraine can appeal the decision to the WTO's appellate body. But while the WTO ruled that Russia could invoke national security to suspend Ukraine's access to its railroads,...

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