How More 'Likeness' in Addressing Technical Regulations?
29 Pages Posted: 13 Jul 2012
Date Written: July 12, 2012
The obligations of non-discrimination in international economic law hinge upon the question of what constitutes ‘like products’. It is not clear that it is appropriate to transpose the competition-oriented approach to product likeness or substitutability under Article III of GATT to other provisions of WTO Agreement, including, Article 2.1 of the TBT Agreement.
For the first time in WTO dispute settlement, the Panel in US – Clove Cigarettes was tasked with determining likeness in the TBT context. At issue was whether the US government may ban sales of clove cigarettes while exempting menthol cigarettes. The panel held that Article 2.1 of TBT Agreement should not be interpreted primarily from a competition perspective of dealing with a technical regulation with legitimate public health objectives. The panel noted the significance of public health objectives of a technical regulation and how certain features of the relevant products must be evaluated given the legitimate public health objective. The declared objective of the measure must inform the likeness analysis. Based upon these criteria, the Panel ruled that clove and menthol cigarettes are like products since the US measure has the primary objective of protecting health of minors against carcinogenic substances which both types of cigarettes contain.
Is this a resurrection of the aim-and-effect test; or, an updated version of EC-Asbestos rationale? Fundamentally, is it wrong to apply an aim-and-effect approach in the TBT context, given that there is no general exception provision equivalent to Article XX of GATT in TBT Agreement? What implications can be drawn from this decision to future disputes over technical regulations imposed for health protection purposes?
The author answer these intriguing questions through a comprehensive review and examination on newly-emerging WTO case law and decades-old jurisprudence on product likeness. WTO tribunals must suggest a better interpretive solution for many future disputes and regulatory policies concerning this enigmatic topic.
Keywords: Like Products, TBT Agreement, U.S.- Clove Cigarettes, Aim-and-Effect Test
JEL Classification: F02, F10, F20, F30, F40
Suggested Citation: Suggested Citation