Russia received unexpected support from the administration of the US President Donald Trump in a landmark case in the World Trade Organization.
Speech in this case is about the Ukrainian transit, writes on Monday, July 30, Politico. The publication is asked the key question: what actions can countries take in the name of national security, even if it violates their WTO obligations? It is noted that the decision of the panel of the organization, which is expected at the end of this year, may have consequences for a number of cases against the United States due to the introduction of duties on steel and aluminum by Trump, since it concerns the right of the WTO to decide on restrictions imposed from national security considerations. The case against Russia is connected with another problem, namely the transit restrictions that Moscow imposed on Kiev in January 2016, cutting the main markets in Central Asia and the Caucasus, where Ukrainian exporters can only get on Russian roads. Despite the fact that the US supports the Independent in the territorial conflict with the Russian Federation, Washington and Moscow insist that the WTO has no right to consider cases with regard to transit restrictions. The Russian side claims that it has imposed restrictions, guided by Article 21 of the General Agreement on Tariffs and Trade, which allows WTO Members to resort to actions that violate their obligations in the organization, guided by national security considerations, clarifies the publication. The US government argues that "a dispute that deals with security is political in nature and therefore lies outside the competence of the WTO". The same argument the administration of Trump uses to justify the tariffs imposed on steel and aluminum introduced this spring.
Both Washington and Moscow insist that the claims under Article 21 "are not subject to prosecution" - this means that the WTO panels can not rule on any dispute, referring to the national security exception. In other words, they argue that "as soon as someone utters the word" article 21 "aloud, the panel must stop and return home," the article quoted a recent speech by ex-judge of the WTO Appellate Body Jennifer Hillman.
Other members of the organization, such as Canada, insist that countries should at least argue why they apply article 21. However, Washington and Moscow object: once the state decides that the action meets the interests of national security, it does not need to explain this decision to other members. Earlier today it became known that Ukraine has lost the second dispute with Russia within the framework of the World Trade Organization. This time, the Ukrainian side lost the claim to limit the import of wagons and turnouts in October 2015 in the Russian Federation.
Prior to this, in May, the arbitration court satisfied almost all the claims for Moscow's claim against Kiev regarding duties on Russian ammonium nitrate.
Therefore, there is a very high risk that Kiev will also suffer a fiasco over transit.