The World Trade Organization opened Pandora's Box last week, issuing its first-ever ruling on "national security." The decision addressed the increasingly central questions of whether and how states can claim national security to justify the imposition of trade restrictions. The result was a Solomonic declaration that affirmed the right of governments to use that justification while asserting that the WTO has the authority to determine the validity of that claim. While gratifying for advocates of liberal trade, it anticipates a more pitched battle over the same issues. The challenge is to address problems at the WTO that have motivated governments to use this exemption.
All treaties and international institutions include "escape clauses" that allow member governments to invoke national security to retain national sovereignty and authority in certain cases. There is an expectation, however, that such rationalizations will be used only in exceptional cases; if this power is abused, then those commitments are meaningless.
Article 21 of the General Agreement on Tariffs and Trade (GATT), the rules that are the foundation of the WTO, allows a government to ignore its free trade obligations "for the protection of its essential security interests ... in time of war or other emergency in international relations." In the 72 years since the GATT was promulgated, international trade arbitrators have not had to determine the scope of that exemption.