The Trade Agreement On Safeguards Essay

1433 Words Mar 16th, 2015 null Page
The confusion and inconsistencies Article XIX created, forced member countries to work on a successive agreement that would be a more clear and effective when governing safeguards. This was cultivated at the Uruguay Round of trade negotiations in 1994, creating the Agreement on Safeguards (SG Agreement). The SG Agreement’s main purpose was to:
(1) Clarify and reinforce GATT disciplines, particularly those of Article XIX; (2) re-establish multilateral control over safeguards and eliminate measures that escape such control; (3) encourage structural adjustment on the part of industries adversely affected by increased imports.

Used as a temporary import restraint, safeguards protect domestic import-competing industries from foreign competition. Under the GATT, when countries negotiated reciprocal tariff concessions they committed themselves to maximum binding tariffs, which restricted domestic policy maker’s authority to unilaterally raise its tariffs at a later date. The GATT’s contracting parties were increasingly applying a variety of “grey area” measures, bilateral voluntary export restraints, which limited imports of a certain product, creating confusion amongst decision making authorities.
Agreement on Safeguards

The SG Agreement has four major components and establishes the vehicle in which measures may be applied pursuant to Article XIX of the GATT. In a Panel Report that arose out of a dispute between the European Community (EC) and the safeguard measures…

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