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Chapter 9 Legal System on Safeguard Measures Section 1 An Overview “clausula rebus sic stantibus” when legitimate imports cause or threaten serious injury to domestic production, safeguard procedures may be invoked safeguards constitute a right or response to fair trade practices Article 19 of the GATT 1994 provides for the use of safeguards where increased imports “cause or threaten serious injury” (and for the imposition of substantially equivalent concessions in the event safeguards are imposed) GATT 1947 Article 19 - Emergency Action on Imports of Particular Products ?1. (a) If, as a result of unforeseen developments and of the effect of the obligations incurred by a contracting party under this Agreement, including tariff concessions, any product is being imported into the territory of that contracting party in such increased quantities and under such conditions as to cause or threaten serious injury to domestic producers in that territory of like or directly competitive products, the contracting party shall be free, in respect of such product, and to the extent and for such time as may be necessary to prevent or remedy such injury, to suspend the obligation in whole or in part or to withdraw or modify the concession. Safeguards under Article 19, safeguards must be applied on a MFN basis (imports of the product from all sources must be treated equally; it is not possible to impose safeguards only against imports from selected countries; this feature tended to increase the “cost” of imposing safeguards, as many nations might be affected, and might seek retaliatory action) the result is that safeguards were rarely used, and anti-dumping and countervailing duties were a more attractive and less costly way to protect domestic production (because they could be selective and there was no requirement of compensation) Agreement on Safeguards 1994 the Agreement on Safeguards of the Uruguay Round provides a much more stringent standard for administrative proceedings
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