Safeguard

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For other uses of "Safeguard", see Safeguard (disambiguation).

In international law a safeguard is a restraint on international trade or economic development to protect communities from development aggression or home industries from foreign competition.

In the World Trade Organization (WTO) system, a member may take a safeguard action, such as restricting imports of a product temporarily, to protect a domestic industry from an increase in imports causing, or threatening to cause, injury to domestic production.

In the United Nations Framework Convention on Climate Change, safeguards are intended to protect indigenous peoples and other local communities with traditional knowledge of natural resource management, within efforts towards reducing emissions from deforestation and forest degradation.[1]

The WTO and UNFCCC concepts are related within international law.[2][3][4]

Background[edit]

With UNFCC processes, safeguards became of concern in the second decade of the 21st century.[5]

Within the WTO, safeguard measures were available under the General Agreement on Tariffs and Trade (GATT) (Article XIX). However, they were infrequently used, and some governments preferred to protect their industries through “grey area” measures (“voluntary” export restraint arrangements on products such as cars, steel and semiconductors). As part of the WTO deal, members gave up these “grey area” measures and adopted a specific WTO Safeguards Agreement [1] which disciplines the use of safeguard measures.

Safeguards are usually seen as responses to economic development and trade processes that align with international law, as opposed to negative practices such as dumping or subsidies.

In the context of world trade they are supposed to be used only in very specific circumstances, with compensation, and on a universal basis. For example, a member restricting imports for safeguard purposes would have to restrict imports from all other countries. However, exceptions to this non-discriminatory rule are provided for in the Agreement on Safeguards itself as well as in some ad hoc agreements. In this last respect it is worthwhile noting that the People's Republic of China accepted that discriminatory safeguards may be imposed on its exports to other WTO members until 2013.

Regional trading arrangements have their own rules relating to safeguards. Some safeguard measures can be resorted to in the area of services, as provided for in the General Agreement on Trade in Services (GATS).

See also[edit]

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