The World Trade Organization (WTO) Safeguards Agreement was adopted in 1994 during the Uruguay Round of trade negotiations. Its purpose is to provide a framework for member countries to apply safeguards measures to prevent or alleviate serious injury to their domestic industries caused by an increase in imports.
The text of the WTO Safeguards Agreement specifies the rules and procedures that should be followed when applying safeguards measures. These measures may include temporary import restrictions or tariffs to limit the quantity of imports or to increase their price, depending on the nature of the injury suffered by the domestic industry.
The agreement distinguishes between two types of safeguards measures: global and special. Global safeguards are applied uniformly to all sources of imports, while special safeguards are targeted to specific products or countries. Additionally, the agreement sets out requirements for transparency, consultation, and notification, to ensure that the measures are not used as a disguised form of protectionism.
One key provision of the WTO Safeguards Agreement is that any member country intending to apply a safeguard measure must follow a prescribed investigation process to establish the existence of serious injury or threat thereof. This process includes notifying all affected parties, conducting an investigation, and providing an opportunity for interested parties to comment on the proposed measure.
Furthermore, the agreement outlines the conditions under which safeguard measures can be imposed, including the maximum duration of the measure and the need to progressively liberalize it over time. The agreement also requires member countries to provide compensation to affected exporting countries, where appropriate, to minimize the adverse effects of the safeguard measures on their trade.
In conclusion, the WTO Safeguards Agreement is an important tool for member countries to protect their domestic industries against import surges. The agreement provides a framework for the application of safeguard measures in a transparent, equitable, and non-discriminatory manner, consistent with the principles of the WTO. By following the rules and procedures outlined in the text, member countries can better manage the risks associated with import competition while maintaining an open and predictable trading system.