Security Exceptions in the WTO System: Bridge or Bottle-Neck for Trade and Security?

Abstract

The General Agreement on Tariffs and Trade (GATT) Article XXI remains intact, without any modification, since the inception of the GATT in 1947. Recent economic and political developments, however, are not well addressed in the Security Exceptions enshrined in Article XXI. Moreover, the security exceptions that have been incorporated into the General Agreement on Trade in Services and the Trade-Related Aspects of Intellectual Property Rights Agreement feature some discrepancies as compared to the text in the GATT, which causes confusion. Some free trade agreements have occasionally introduced security exception provisions as well, with notable distinctions compared to those of the World Trade Organization (WTO). The current world trading system has to deal with wholly different dimensions of national security such as cyber-security, terrorism, and energy security. This situation raises an imminent question on how to make those arcane security exception provisions effectively workable legal disciplines. This article examines legal developments in WTO and Free Trade Agreement security exceptions and diagnoses the systematic challenges to effectively apply the Security Exceptions. The WTO Members need to address this issue as early as possible to avoid an unnecessary and inappropriate burden for the dispute settlement system.