The General Agreement on Tariffs and Trade
Essay Preview: The General Agreement on Tariffs and Trade
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The Australia government has placed bans on the importation of apples raised from certain orchards in New Zealand unless the apples meet two conditions that the Australia government required. Australia says that these two conditions must be imposed if Australia orchards are to be protected from the diseases and pests.
New Zealand government complains that Australia measures do not comply with the requirements of WTO, including the GATT 1994(1947) and the Agreement on Sanitary and Phytosanitary Measure (SPS). Both of Australia and New Zealand are the members of WTO.
In this case, Actions of Australia might have contravened GATT article I, III and XI. The bans on the importation of apples from New Zealand also do not conform to the SPS Agreement.
GATT
The GATT applies to measures that affect the fairness of trade in products. In this case, apples are the products and those two conditions that Australia required are the unfair measures.
Article I
Article I requires members to give a fair treatment to the products of all members of the WTO. Article I(1) also set up the concept of “Most Fvoured Nation”. MFN is a standard of non-discrimination between different nations. It means that the measures must not give any less favourable treatment to the product of one member than that they give to the like products of other members.
In the present condition, to decide whether Australia has contravened this provision, I would need to know whether Australia have banned like products from other countries as well as New Zealand. In the statement of this case, there are not enough evidences to prove that Australia banned the importation of apples from other countries as well as New Zealand. So whether Australia contravenes Article I depend on further information.
Article III
Article III requires members to give fair national treatment to the products of other members as well as the domestic products. The measures must not give less favourable treatment than the treatment given to like products of national origin. No imported products shall be subjected to taxes or internal charges in excess of those applied to like domestic products.
National treatment is applied to the products that imported into the territory and it is related with the internal measures. In this case, we know Australia has banned the importation of apples from New Zealand. But no further information is provided, so we do not know whether the Australia also give the same favourable treatment to like domestic products. If it did not do that, Australia would contravene Article III.
Article XI
In this case, there is a clear contravention to the article XI by Australia because the Australia government banned the importation of apples from New Zealand, and it also set two conditions to restrict the importation of apples.
Article XX
If the Australia contravene to the articles above, some exceptions should also be considered. The relevant exception is article XX (b) that their measures are necessary to protect human, animal or plant life or health. For a measure to be “necessary”, Australia must have scientific evidence of the product’ risk. It is related with articles of SPS.
SPS
SPS article 2 requires measures to be based on scientific principles and to be maintained with sufficient scientific evidence. It is clearly that, Australian Government can state that, firstly, they had this condition necessarily for protect its own plant and because the disease may be expanded to a large area, they need to have serious condition for the plants safety inside its own territory. It can state that how harmful that disease was and how terrible the effect will be on the Australian orchard as evidence. It can also state that the proximity between Australia and New Zealand and the how easy the disease irritated give the government the consideration of having a strong requirement on importing.