Pandemic Delays WTO Rulings On Trump Security Tariffs

By Emma Whitford
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Law360 (February 8, 2021, 2:39 PM EST) -- A World Trade Organization panel overseeing numerous challenges to the Trump administration's national security duties on steel and aluminum is delaying final rulings until the second half of the year due to the coronavirus pandemic.

Rulings on challenges brought by China, India, Norway, Russia, Switzerland, Turkey and the European Union to the 2018 duties can be expected "no earlier than the second half of 2021," according to communications from the WTO panel released Monday.

Reports in such cases are supposed to be released within six months of the panel being assembled, according to the Understanding on Rules and Procedures Governing the Settlement of Disputes. But exceptions are allowed, in this case due to "delays caused by the global COVID-19 pandemic," according to the notices.

The WTO only recently started weighing national security cases, following a landmark April 2019 decision in which a dispute resolution panel ruled that Russia was within its rights to put restrictions on Ukrainian goods in the name of national security.

Trump used the same rationale to impose a 25% levy on steel and a 10% duty on aluminum in 2018, citing Section 232 of the Trade Expansion Act of 1962, which empowers the president to set import restrictions on the basis of national security.

This sparked a wave of WTO challenges, in which U.S. trade partners accused the country of using national security as a veil for economic protectionism.

In the 2019 Russia decision, the panel cited the WTO's so-called national security exception, which is contained within Article XXI of the General Agreement on Tariffs and Trade.

While Article XXI is meant to allow countries to impose trade barriers for security reasons, its scope and meaning had never before been examined by a WTO legal body.

WTO critics worried that a narrow reading of the article would lead to international tribunals dictating countries' security decisions, while free trade backers worried that a broad reading would allow countries to move ahead with purely economic restrictions masked as security decisions.

The WTO weighed in on trade restrictions in the name of national security for a second time last June, rejecting such restrictions in a case over Saudi Arabia's failure to prosecute a broadcaster for stealing a Qatari media company's content.

The Norwegian Embassy declined to comment Monday. Embassies for the six other parties challenging the Trump-era tariffs did not immediately respond to requests for comment Monday, and neither did the United States Trade Representative.

Even when the delayed WTO rulings on the steel and aluminum tariffs arrive later this year, next steps will remain unclear. This is because the Trump administration single-handedly blocked new judges from filling vacancies on the WTO's Appellate Body, shuttering Geneva's top legal authority at the end of 2019.

Earlier this month, the U.S. Court of International Trade upheld the Trump administration's tariffs on imported steel, finding that they were imposed in line with Section 232 of the Trade Expansion Act.

Since taking office last month, President Joe Biden has not weighed in explicitly on the steel and aluminum tariffs before the WTO. However, this month he blocked one of Trump's final orders that was intended to walk back tariff relief for aluminum imports from the United Arab Emirates, citing national security concerns.

--Additional reporting by Alex Lawson, Jennifer Doherty and Sarah Martinson. Editing by Daniel King.

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