[Congressional Record Volume 141, Number 181 (Wednesday, November 15, 1995)]
[Senate]
[Pages S17097-S17100]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         ADDITIONAL STATEMENTS

                                 ______


        THE LIKELIHOOD OF A GATT CHALLENGE TO AN EMBARGO ON IRAN

 Mr. D'AMATO. Mr. President, I rise today to discuss the 
likelihood of a GATT challenge to an embargo on Iran.
  On December 13, 1994, the Congressional Research Service did a 
Memorandum for Representative Peter DeFazio entitled ``The Likelihood 
of a 

[[Page S17098]]
GATT challenge to the Cuban embargo under the GATT 1994 and the WTO.'' 
This document further backs up my assertion that the United States, 
under Article 21 of the GATT, the United States has the broad authority 
to impose sanctions against another country for reasons of national 
security, and by connection we have that right to do so in the case of 
Iran. Mr. President, so that my colleagues can read this interesting 
memorandum, I ask that this memo be printed in the Record at the 
conclusion of my remarks.
  I would also like to comment on section 8(a) of the Export 
Administration Act of 1979, as it relates to S. 1228, the Iran Foreign 
Oil Sanctions Act of 1995. For purposes of demonstration, I would like 
to comment on paragraph (1) of this section which reads as follows:

       (1) For the purpose of implementing the policies set forth 
     in subparagraph (A) or (B) of paragraph (5) of section 3 of 
     this Act, the President shall issue regulations prohibiting 
     any United States person, with respect to his activities in 
     the interstate or foreign commerce of the United States, from 
     taking or knowingly agreeing to take any of the following 
     actions with intent to comply with, further, or support any 
     boycott fostered or imposed by a foreign country against a 
     country which is friendly to the United States and which is 
     not itself the object of any form of boycott pursuant to 
     United States law or regulation. . ..''

  This paragraph is very instructive because it prohibits U.S. 
companies from dealing with a country that abides by an 
``unsanctioned'' third-party boycott against another country. However, 
the stipulations of this paragraph are vital to the argument supporting 
a ``sanctioned'' third-party embargo against Iran. The intent here is 
to prevent support for ``* * * any boycott fostered or imposed by a 
foreign country against a country which is friendly to the United 
States and which is not itself the object of any form of boycott 
pursuant to United States law or regulation * * *.'' The phrases 
``against a country which is friendly to the United States,'' and 
``which is not itself the object of any form of boycott pursuant to 
United States law or regulation'' are key to the argument. In the case 
of Iran, I think everyone would agree that Iran is not friendly to the 
United States and equally so, it is certainly a matter of fact that 
Iran is subject to sanctions by the United States.
  Therefore, the opponents of this legislation cannot argue against the 
Iran sanctions legislation because there are provisions in the bill 
that would require United States companies to avoid doing business with 
companies that sell oil and gas equipment to Iran. The ``anti-boycott 
provisions in the EAA clearly permit the imposition of ``sanctioned 
boycotts'' against countries which are unfriendly to the United States.
  The material follows:
                                   Congressional Research Service,


                                      The Library of Congress,

                                Washington, DC, December 13, 1994.
     To: Hon. Peter A. DeFazio.
      (Attention: Peter Tyler).
     From: American Law Division.
     Subject: Likelihood of a GATT challenge to the Cuban embargo 
         under the GATT 1994 and the WTO.
       This memorandum is in response to your inquiry concerning 
     the possibility of Cuba's bringing a challenge to the U.S. 
     embargo against it before the World Trade Organization (WTO) 
     under the terms of the General Agreement on Tariffs and Trade 
     of 1994, the General Agreement as it emerged from the Uruguay 
     Round.\1\ Unless otherwise exempted by other provisions under 
     the GATT 1994, the Cuban embargo is arguably inconsistent 
     with the obligations to extend most-favored-nation (MFN) 
     treatment under Article I: 1, of the GATT 1994,\2\ to extend 
     national treatment under Article II: 4, of the GATT 1994, and 
     to eliminate quantitative restrictions generally under 
     Article XI: 1, of the GATT 1994. The U.S. embargo against 
     Cuba appears to be justifiable under the international law 
     concept of fundamental change in circumstances, i.e., Cuba's 
     change to a communist regime and a non-market economy. The 
     national security exception under Article XXI of GATT 1994 
     may also exempt the embargo as a national security measure. 
     Also, the United States could request a waiver to permit the 
     embargo, but this may be difficult to obtain. Apparently, 
     there is some concern that the strengthened dispute 
     settlement and enforcement mechanisms under the GATT 1994 may 
     motivate Cuba to bring a challenge to the embargo. You also 
     indicated concern about possible limitations on unilateral 
     quantitative restrictions under the GATT 1994, but it seems 
     these limitations generally involve limitations on 
     quantitative restrictions that have been permissible in the 
     past as a routine matter under textile arrangements, for 
     balance-of-payments reasons, and the like, and not 
     limitations on embargoes that are justifiable under other 
     provisions of the GATT. This memorandum will briefly discuss 
     the history of the embargo and the possible justifications 
     for the embargo under the GATT.
     Footnotes at end of article.
---------------------------------------------------------------------------
       Cuba is an original contracting party to the GATT,\3\ yet 
     the United States has had an embargo on Cuba since 1962.\4\ 
     Cuba has from time to time protested or commented negatively 
     on the U.S. embargo as GATT illegal,\5\ indicating that the 
     United States has never formally justified its actions in the 
     GATT context. These comments or protests either concern the 
     Cuban Democracy Act of 1992 or the support of other countries 
     subjected to sanctions by the United States. It is unclear 
     whether Cuba made a formal complaint about the original 
     embargo in the GATT forum.\6\ The United States was 
     apparently motivated by the communist coup and unresolved 
     U.S. compensation claims arising from the expropriation and 
     nationalization of U.S. property holdings in Cuba and also by 
     concerns about human rights abuses and the lack of democracy 
     in Cuba.\7\


           the concept of fundamental change in circumstances

       It appears that justification of the embargo was possible 
     under the international law concept of fundamental change in 
     circumstance. However, this requires notification to the 
     other parties of action taken pursuant to the doctrine. Under 
     the international law concept of fundamental change in 
     circumstances, the United States and other GATT parties could 
     have considered Cuba to no longer be a member of GATT when 
     Castro deposed the Cuban government that had been in power 
     when the GATT 1947 was concluded. This concept, codified in 
     the Vienna Convention on the Law of Treaties,\8\ states that 
     where there has been a fundamental change from the 
     circumstances existing at the time of the conclusion of an 
     international agreement, which was not foreseen by the 
     parties, this change may not be a ground for terminating or 
     withdrawing from the agreement unless the circumstances were 
     essential to the consent of the parties to be bound by the 
     agreement and the change radically transforms the extent of 
     obligations still to be performed under the agreement. A 
     party may not invoke this doctrine if the fundamental change 
     of circumstances was the result of the invoking party's 
     breach of an obligation under the agreement or of any 
     international obligation owed by that party to any other 
     party to the agreement. If a party may invoke the doctrine 
     for termination of or withdrawal from an agreement, it may 
     also invoke it for suspension of the operation of the 
     agreement. A party invoking this doctrine must notify other 
     parties to the agreement.\9\
       The original circumstances, that Cuba was controlled by a 
     non-communist regime and was a market economy, were arguably 
     essential to the Agreement. Although non-market economies 
     have acceded to the GATT, they have done so under protocols 
     specifying goals and measures to be met to ensure fair trade. 
     Also, given the international political situation at the 
     time, the cuban change to a communist-style government and 
     the resulting political and military tensions between the two 
     countries could be considered by the United States to 
     constitute a fundamental change of circumstances sufficient 
     to terminate or suspend the operation of an agreement.\10\
       The United States and other GATT parties could have 
     notified, and may still be able to notify, the GATT that, 
     under the doctrine, they consider the GATT terminated (or 
     suspended) with respect to Cuba.\11\ There apparently was 
     never any formal declaration by either the United States or 
     Cuba to the GATT Contracting Parties of any inability to 
     continue the application of the General Agreement to each 
     other. Although the United States has not declared a formal 
     suspension regarding agreements with Cuba generally, 
     apparently many agreements are not being applied.\12\


                       Application of Article XXI

       The United States could justify its embargo for national 
     security reasons under GATT Article XXI(b)(iii), because of 
     the acts of hostility between the two at the time the embargo 
     was imposed. The national security reasons need not be 
     formally stated to the GATT Contracting Parties.\13\ However, 
     the presidential proclamation declaring the embargo against 
     Cuba gave self-defense and national security as the reasons 
     for it.\14\
       Historically, the United States has suspended most-favored-
     nation treatment for various countries and justified its 
     actions under GATT exceptions, particularly GATT Article XXI 
     concerning security exceptions. Article XXI, provides that 
     nothing in the Agreement shall be construed (1) to require a 
     contracting party to reveal information the disclosure of 
     which is contrary to its security interests; (2) to prevent 
     measures, which a party considers necessary to the protection 
     of its security interests and which are related to nuclear 
     material, related to trade in arms, or taken in time of war 
     or other international emergency; (3) or to prevent a party 
     from taking action pursuant to its obligations under the 
     United Nations Charter for the maintenance of international 
     peace and security. The security exceptions have been 

[[Page S17099]]
     applicable in several cases where the United States has suspended MFN 
     treatment, although some parties have felt that the United 
     States has relied excessively on Article XXI in justifying 
     its actions. However, a GATT panel has decided that the 
     underlying justification for a claim of the national security 
     exception will not be questioned. This decision resulted from 
     Nicaragua's GATT challenge to the embargo that the U.S. 
     imposed on it.
       Nicaragua became a GATT contracting party on May 28, 1950, 
     under the terms of the 1949 Annecy Protocol of Terms of 
     Accession.\15\ In the late 1970s and early 1980s, relations 
     between the United States and the Nicaraguan Sandinista-
     controlled government deteriorated as the United States cut 
     off aid to the Nicaraguan government and supported Contra 
     rebel efforts to bring about a free and independent 
     government by deposing the Sandinista government.\16\ On 
     September 23, 1983, President Reagan reduced the import quota 
     for Nicaraguan sugar.\17\ Nicaragua brought a complaint 
     before the GATT. A dispute settlement panel found that the 
     quota reduction was in violation of GATT Article XIII, which 
     provides that quantitative restrictions of a product are only 
     permissible where similar measures are applied to all imports 
     and exports of that product and where the import quota shares 
     are distributed among the parties concerned in a way that 
     approximates as nearly as possible the share each party would 
     have had in the absence of restrictions.\18\ The United 
     States did not invoke any exception and seems to have 
     effectively refused to defend itself on GATT grounds, stating 
     merely that any actions taken were not matters of trade 
     policy and could not be properly evaluated in the trade 
     context, and that the United States had not benefitted in any 
     economic manner from the reduction in Nicaragua's quota.\19\ 
     The panel report was adopted on March 13, 1984, but in 
     November 1984, Nicaragua was complaining that the United 
     States still had not restored its sugar quota.\20\ The United 
     States agreed that Nicaragua had rights, but maintained its 
     position that the situation had to be viewed in a political 
     context.\21\
       President Reagan imposed an embargo on Nicaragua by 
     executive order on May 1, 1985, pursuant to his authority 
     under the International Economic Emergency Act and the 
     National Emergency Act, among others.\22\ He found that the 
     ``policies and actions of the Government of Nicaragua 
     constitute an unusual and extraordinary threat to the 
     national security and foreign policy of the United States and 
     hereby declare a national emergency to deal with the 
     threat.'' The embargo prohibited all imports of goods and 
     services of Nicaraguan origin and all exports of goods and 
     services destined for Nicaragua except for those destined for 
     the democratic resistance organization. Additionally, 
     Nicaraguan aircraft were forbidden from landing in or taking 
     off from the United States and Nicaraguan vessels were 
     prohibited from entering U.S.ports.
       The embargo against Nicaragua is notable particularly 
     because Nicaragua brought a formal complaint before the GATT 
     and got the reluctant United States to agree to the formation 
     of a dispute settlement panel.\23\ Although discrete 
     discriminatory measures had been challenged, a virtually 
     total embargo apparently had never before been brought before 
     a dispute settlement panel. Nicaragua also had previously 
     sued the United States before the International Court of 
     Justice (ICJ) and gotten a determination that the military 
     and paramilitary actions taken against Nicaragua, including 
     the embargo, were violations of international law.\24\
       The United States claimed an exception under the national 
     security clause of GATT Article XXI.\25\ Nicaragua challenged 
     the validity of the motives of the United States, complaining 
     that it was improperly using a trade forum and trade measures 
     to achieve political ends.\26\ It wanted a panel to examine 
     the validity of the United States' claim to the national 
     security exemption by determining whether the Nicaraguan 
     situation posed a valid national security concern for the 
     United States.\27\ But although the United States consented 
     to the formation of a panel, it insisted that the GATT could 
     not question the validity of a party's national security 
     concerns.\28\ It was a party's prerogative to decide what it 
     considered a threat to national security. The GATT members 
     agreed and did not authorize the panel to examine the 
     justification for the invocation of GATT Article XXI. The 
     panel could only decide whether the measures taken by the 
     United States were consistent or inconsistent with the 
     General Agreement. Therefore, the panel concluded that it 
     could not determine whether the actions of the United States 
     were inconsistent with or in compliance with its obligations 
     under the General Agreement.\29\
       Thus, the United States successfully invoked the national 
     security exception under GATT Article XXI and used trade 
     sanctions for political purposes, which it maintained was 
     permissible. However, although many other GATT parties agreed 
     that GATT Article XXI properly left to each party the 
     judgment of what constituted its essential security 
     interests, the parties also regretted the expansive 
     interpretation of the exception by the United States and were 
     concerned that frequent resort to it as an all-purposes 
     defense would erode the GATT rules.\30\ They also noted the 
     1982 decision regarding GATT Article XXI, indicating that 
     actions under Article XXI, should not be overly broad in 
     scope.\31\ Free elections were held in Nicaragua in February 
     1990.\32\ President Bush restored the sugar quota in April 
     1990\33\ and Nicaragua, stating that it had reached an 
     agreement with the United States on economic relations, 
     requested the discontinuation of proceedings to determine 
     reparations in the ICJ case in 1991.\34\


   the possibility of a waiver under gatt article xxv: 5 and the wto 
                               agreement

       Article IX:3 of the WTO Agreement\35\ specifies a three-
     fourths majority vote for a waiver of a multilateral trade 
     agreement obligation ``in exceptional circumstances.'' 
     Article XVI:3 of the WTO Agreement provides that in case of a 
     conflict between a WTO Agreement provision and that of a 
     multilateral trade agreement, the WTO Agreement prevails. 
     GATT Article XXV:5 provides that the Contracting Parties may 
     waive an obligation for a particular party ``in exceptional 
     circumstances not elsewhere provided for in this agreement'' 
     by a two-thirds majority vote of approval where such majority 
     comprises more than half of the parties.\36\ So under the 
     terms of the WTO Agreement, a three-fourths vote is now 
     required. Under GATT Article XXV:V, the GATT parties may also 
     by such a vote define certain categories of exceptional 
     circumstances to which other voting requirements shall apply 
     for a waiver and may prescribe such criteria as may be 
     necessary for the application of Article XXV:5. Article IX:4 
     of the WTO Agreement provides that a waiver granted for more 
     than one year shall be reviewed annually by the Ministerial 
     Conference which shall examine whether the exceptional 
     circumstances justifying the waiver still exist and whether 
     all terms and conditions for the waiver have been met. 
     Possibly the United States could ask for a waiver of the MFN 
     for Cuba, but the three-fourths majority required for the 
     grant of the waiver would be difficult to meet; the 
     Contracting Parties are unlikely to relax the requirements 
     for such a serious matter. Furthermore, the annual review of 
     the waiver would make it necessary to satisfy the Ministerial 
     Conference that the exceptional circumstances still existed 
     in order to maintain an embargo pursuant to a waiver, thereby 
     making it less likely that such an embargo could be 
     maintained indefinitely. In the 1950s, the United States and 
     Czechoslovakia were granted waivers to suspend application of 
     the GATT to each other.
       In 1951, the United States suspended application of the 
     GATT to Czechoslovakia, although it was an original signatory 
     to the GATT and accepted the Protocol of Provisional 
     Application\37\ and the United States had not invoked GATT 
     Article XXXV, providing for non-application between parties 
     upon accession, with respect to Czechoslovakia upon the 
     accession of the two to the GATT. Czechoslovakia did not have 
     a non-market economy at the time of its accession to the GATT 
     on April 20, 1948.\38\ But subsequent changes in the 
     government of Czechoslovakia and friction with the United 
     States over U.S. claims to compensation for postwar 
     nationalizations led to a breach in trade relations.\39\ The 
     United States and Czechoslovakia each made declarations, 
     using language found in GATT Article XXIII:1, that the other, 
     through its actions, had nullified benefits which should have 
     accrued to the declaring party.\40\
       Although the GATT parties apparently considered the issue 
     to have been resolved through dispute settlement under GATT 
     Article XXIII:2,\41\ it also appears that the Contracting 
     Parties took joint action pursuant to GATT Article XXV:5.\42\ 
     This provides that ``under exceptional circumstances not 
     elsewhere provided for in this Agreement, the Contracting 
     Parties may waive an obligation imposed upon a contracting 
     party by this Agreement; Provided that any such decision 
     shall be approved by a two-thirds majority of the votes cast 
     and that such majority shall comprise more than half of the 
     contracting parties [emphasis added].'' The Contracting 
     Parties declared that, considering ``that a contracting party 
     may not be held subject to the provisions of the General 
     Agreement when the fulfillment [sic] of its obligations is 
     rendered impossible by exceptional circumstances of a kind 
     different from those contemplated under the General Agreement 
     . . . the Governments of the United States and Czechoslovakia 
     shall be free to suspend, each with respect to the other, the 
     obligations of the [GATT] [emphasis added].''\13\
       However, more recently where the waiver has been requested 
     by a party for discriminatory treatment of a certain other 
     party, the discriminatory treatment was to the benefit of the 
     other party. For example, the original GATT authority for 
     voluntary tariff preference programs for developing 
     countries, e.g., Generalized System of Preferences (GSP), was 
     done by waiver.\44\ Also, Italy requested permission to give 
     more favorable treatment to certain products from Libya and 
     from Somalia; Australia asked permission to treat certain 
     products of Papua-New Gunea more favorably.\45\ The more 
     developed country was trying to assist the economic 
     development of the lesser developed country or to continue a 
     traditional special relationship. So a waiver to deny MFN 
     treatment to Cuba may be difficult to obtain, particularly 
     since Cuba now, unlike Czechoslovakia in the 1950s, 
     apparently has no interest in a mutual suspension of GATT 
     application, as evidenced by its protests that the embargo is 
     illegal.\46\


                               conclusion

       The U.S. suspension of application of the General Agreement 
     to Cuba, embodied by the 

[[Page S17100]]
     embargo, is probably justifiable under international law on the grounds 
     of Cuba's change to a communist regime and a non-market 
     economy. The United States may also invoke GATT Article XXI, 
     the national security exception, on the basis of a concern 
     for national security, with our without a mutual declaration 
     of suspension authorized by the Contracting Parties. A waiver 
     to permit the embargo may be requested under Articles IX:3 
     and IX:4 of the WTO Agreement and GATT Article XXV:5, but may 
     not be readily granted.
       If we can be of further assistance, please let us know.
                                             Margaret Mikyung Lee,
                                     Legislative Attorney.


                               footnotes

     \1\General Agreement on Tariffs and Trade of 1994 as defined 
     in Annex 1A of the Final Act embodying the results of the 
     Uruguay Round of Multilateral Trade Negotiations, concluded 
     April 15, 1994 (reprinted at H. Doc. No. 103-316, Vol. I, 
     103d Cong., 2d Sess. 1339 (1994)).
     \2\The article and paragraphs refer to the provisions of the 
     General Agreement on Tariffs and Trade originally concluded 
     Oct. 30, 1947, 61 Stat. (5) & (6), T.I.A.S. 1700, 55 U.N.T.S. 
     194, and annexed to the Final Act Adopted at the Conclusion 
     of the Second Session of the Preparatory Committee on the 
     United Nations Conference on Trade and Employment (excluding 
     the Protocol of Provisional Application) as amended before 
     the entry into force of the Agreement Establishing the World 
     Trade Organization. Hereinafter, these provisions will be 
     referred to as ``GATT Article ____.''
     \3\It accepted the 1947 Protocol of Provisional Application 
     on Jan. 1, 1948. M. Bowman & D. Harris, ``Multilateral 
     Treaties: Index and Current Status'' 133 (1984).
     \4\Proclamation 3447, 27 Fed. Reg. 1085 (1962) (embargo 
     proclaimed pursuant to Sec. 620(a) of the Foreign Assistance 
     Act of 1961, 75 Stat. 445, authorizing the President to 
     establish and maintain an embargo against Cuba and also 
     pursuant to the Final Act of the Eighth Meeting of 
     Consultation of Ministers of Foreign Affairs, Serving as 
     Organ of Consultation in Application of the Inter-American 
     Treaty of Reciprocal Assistance, which resolved that the 
     present Cuban government was incompatible with the Inter-
     American system and urged member states to take those steps 
     they considered appropriate for their individual and 
     collective self-defense, in light of the offensive of Sino-
     Soviet communism with which the Cuban government was publicly 
     aligned).
     \5\``GATT Activities 1992'' 57 (1992) (Cuba protested the 
     Cuban Democracy Act of 1992 reinforcing the trade embargo of 
     the U.S. against Cuba); Council Hears Cuban Complaint on U.S. 
     Sugar Imports, EC Protest on Manufacturing Clause, 3 
     International Trade Reporter 723 (BNA 1986) (Cuba complained 
     that the U.S. requirement that sugar beet imports through a 
     Third World country must be certified as not being from Cuba 
     discriminated against Cuba and termed the measure ``a clear 
     case of aggression against Cuba''); Nicaragua Charges U.S. is 
     ``Undermining'' Trading System by Cuts in Sugar Quota, 8 
     International Trade Reporter 330 (1983) (Cuba supported 
     Nicaragua's protest against the U.S. embargo against 
     Nicaragua, saying ``we, too, have suffered for more than 20 
     years from U.S. discrimination'').
     \6\There do not appear to be any statements recorded in the 
     official supplements to the Basic Instruments and Selected 
     Documents nor reference to unpublished documents concerning 
     such a statement. However, at the time of the suspension of 
     MFN treatment for Poland, some GATT parties recalled that the 
     United States-Poland dispute was the first time a suspension 
     of MFN treatment had been brought before the GATT since the 
     United States-Cuba breach in trade relations. Poland 
     Unsuccessful in Attempt to Get GATT Censure of U.S. for MFN 
     Suspension, 7 International Trade Reporter 187 (1982).
     \7\U.N. Adopts Resolution Favoring Free and Fair Trade with 
     Cuba, 9 International Trade Reporter 2045 (BNA 1992). 
     Although it may seem that expropriation of property requires 
     some sort of compensation under international law, the 
     developed and developing countries have not been able to 
     agree on this point, with the developed countries insisting 
     on an international minimum standard and the developing 
     countries insisting that expropriation is a domestic matter 
     to be regulated by the expropriating country under its own 
     laws. D. Harris, ``Cases and Materials on International Law'' 
     422-433 (1983).
     \8\Art. 62, May 23, 1969, UN Doc A/Conf 39/27, 8 I.L.M. 679, 
     63 A.J.I.L. 875 See also  Restatement (Third) of the Foreign 
     Relations Law of the United States Sec. 336 (Am. Law Inst. 
     1987) [hereinafter Rest. 3rd].
     \9\Rest. 3rd. supra note 8, Sec. 337, cmt. f, and337 (Am. Law 
     Inst. 1987) [hereinafter Rest. 3rd].
     \10\Rest. 3rd, supra note 8, at Sec. 336(a), cmt. e and 
     Reporters' Note 4 (1987). Although even actual, overt acts of 
     hostility do not necessarily constitute a fundamental change 
     of circumstances sufficient to terminate or suspend the 
     operation of an agreement between the parties engaged in 
     hostilities, where the agreement at issue concerns trade 
     relations and trade is essentially disrupted by political an 
     military tension, the agreement probably could be considered 
     terminated or suspended between the concerned parties. Other 
     types of agreements probably would not be considered 
     terminated by any of the parties because of either overt 
     hostility or political and military tensions. For example, 
     the U.N. Charter prohibits the use of force and was intended 
     to end war as a solution to international disputes, but 
     obviously force is still used to resolve disputes and the 
     Geneva Conventions on the Law of War are considered 
     applicable for humanitarian reasons during hostilities.
     \11\Ya Qin, China and GATT: Accession Instead of Resumption, 
     27 J. of World Trade 77, 95-97 and note 89 (1993); Rest. 3rd, 
     supra note 8, at Sec. 336, cmt. f.
     \12\Rest. 3rd, supra note 8, at Sec. 333, Reporters' Note 3.
     \13\``Nothing in this Agreement shall be construed . . . to 
     prevent any contracting party from taking any action which it 
     considers necessary for the protection of its essential 
     security interests . . . taken in time of war or other 
     emergency in international relations. . . .''
     \14\See supra note 4.
     \15\M. Bowman & D. Harris, supra note 3, at 133.
     \16\Philip Brenner & William M. LeoGrande, Congress and 
     Nicaragua: The Limits of Alternative Policy Making, in ``In 
     Divided Democracy: Cooperation and Conflict Between the 
     President and Congress'' 219, 222-225 (James A. Thurber ed., 
     1991).
     \17\Proclamation No. 5104 of September 23, 1983, 48 Fed. Reg. 
     44057 (1983).
     \18\Dispute Settlement, United States--Imports of Sugar from 
     Nicaragua, 31 B.I.S.D. 66, 73-74 (1985).
     \19\Id. at 72.
     \20\GATT Council Hears Attack on FSCs and Other U.S. Moves, 
     Delays Work Program Evaluation, 1 International Trade 
     Reporter 586 (1984); Impass Occurs at Opening of Annual 
     Meeting as U.S. Threatens to Link Funding to Work, 1 
     International Trade Reporter 644 (1984).
     \21\GATT Council Hears Attack on FSCs and Other U.S. Moves, 
     Delays Work Program Evaluation, supra note 20, at 586.
     \22\Exec. Order No. 12513, 50 Fed. Reg. 18629 (1985).
     \23\U.S., Nicaragua Unsuccessful in Getting GATT Action on 
     Trade Embargo Dispute, 2 International Trade Reporter 765 
     (1985); U.S. Again Blocks GATT Dispute Panel Sought by 
     Nicaragua to Investigate Trade Embargo, 2 International Trade 
     Reporter 965 (1985); GATT Council Appoints Panel to Study 
     U.S. Nicaragua Embargo, Reviews Other Disputes, 2 
     International Trade Reporter 1313 (1985).
     \24\International Court of Justice: Judgment on Merits in 
     Case Concerning Military and Paramilitary Activities In and 
     Against Nicaragua (Nicaragua v. United States), June 27, 
     1986, 25 I.L.M. 1023 (1986); ``GATT Activities 1986'' 59 
     (1987).
     \25\``GATT Activities 1985'' 47-49 (1986); ``GATT Activities 
     1986,'' supra note 24, 58-59. See also supra note 23.
     \26\``GATT Activities 1985,'' supra note 25, at 47; U.S., 
     Nicaragua Unsuccessful in Getting GATT Action on Trade 
     Embargo Dispute, supra note 23.
     \27\``GATT Activities 1985,'' supra note 25, at 57-49; ``GATT 
     Activities 1986,'' supra note 24, at 58-59; U.S., Nicaragua 
     Unsuccessful in Getting GATT Action on Trade Embargo Dispute, 
     supra note 23.
     \28\Id.
     \29\``GATT Activities 1986,'' supra note 24, at 58-59.
     \30\``GATT Activities 1985,'' supra note 25, at 48.
     \31\See also Decision Concerning Art. XXI of the General 
     Agreement, Decision of 30 November 1982, 29 B.I.S.D. 23 
     (1983). The Decision stated that the Contracting Parties 
     should consider the third party interests that may be 
     affected in taking action under Article XXI. When such action 
     is taken, all affected GATT parties retain full rights under 
     the GATT (hereinafter Decision Concerning Art. XXI]. GATT 
     decisions will become part of the GATT 1994 according to the 
     General Agreement on Tariffs and Trade 1994, para. 1(b)(iv), 
     but this provision is hortatory.
     \32\Philip Brenner & William M. LoeGrande, supra note 16, at 
     242.
     \33\Proclamation No. 6120, 55 Fed. Reg. 17744 (1990).
     \34\International Court of Justice: Judgment on Merits in 
     Case Concerning Military and Paramilitary Activities In and 
     Against Nicaragua (Nicaragua v. United States), June 27, 
     1986, supra note 24.
     \35\Agreement Establishing the World Trade Organization, as 
     reprinted in H. Doc. No. 103-316, Vol. I, 103 Cong., Sess. 
     1327 (1994).
     \36\See also Article XXV--Guiding Principles to be Followed 
     by the Constructing Parties in Considering Applications for 
     Waiver from Part I or Other Important Obligations of the 
     Agreement, Procedures adopted on 1 November 1956, 5 B.I.S.D. 
     25 (1957).
     \37\It signed the 1947 PPA on April 20, 1948. M. Bowman & D. 
     Harris, supra note 3, at 133. The 1947 PPA was laid open for 
     signature from Oct. 1947, to Nov. 15, 1947 for eight 
     principal countries, and until June 30, 1948, for all other 
     signatories to the General Agreement. None of the countries 
     discussed in this section were among the eight who signed by 
     Nov. 15, 1947.
     \38\M. Bowman & D. Harris, supra note 3, at 133.
     \39\Article XXI, United States Export Restrictions, Decision 
     of 8 June 1949, II B.I.S.D. 28 (1952) (GATT parties rejected 
     the complaint by Czechoslovakia under Articles I and XXI that 
     U.S. export restrictions did not conform to Article I); Note, 
     East-West Trade: The Accession of Poland to the GATT, 24 
     Stan. L. Rev. 743, at note 7 (1972); Czechoslovakia Renews 
     Effort to Regain MFN, Says U.S. Firms Losing Out in 
     Modernization, 5 International Trade Reporter 117 (BNA 1988).
     \40\Suspension of Obligations between Czechoslovakia and the 
     United States under the Agreement, Declaration of 27 
     September 1951, II B.I.S.D. 36 (1952).
     \41\See the cumulative index at the back of all B.I.S.D. 
     issues which list the suspension of GATT application between 
     the United States and Czechoslovakia as an action under 
     Article XXIII.
     \42\J. Jackson & W. Davey, ``Legal Problems of International 
     Economic Relations: Cases, Materials and Text on the National 
     and International Regulation of Transnational Economic 
     Relations'' 916 (2d Ed. 1988).
     \43\Suspension of Obligations between Czechoslovakia and the 
     United States under the Agreement, supra note 40.
     \44\18th Supp. B.I.S.D. 24 (1972).
     \45\Australia and products of Papua-New Guinea, Decision of 
     24 October 1953, 2 B.I.S.D. 18, 93 (1954); Italy and products 
     of Libya, Decision of 26 October 1951, II B.I.S.D. 10 (1952), 
     Decision of 9 October 1952, 1 B.I.S.D. 14 (1953); Italy and 
     the products of Somalia, Decision of 19 November 1960, 9 
     B.I.S.D. 40, 229 (1961) and other decisions listed in the 
     cumulative index in every volume of the B.I.S.D.
     \46\See supra note 5.

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