The principle of non-discrimination in the world trade organization

Résumé du document

The principle of non discrimination in the frame of the WTO is one of the core principles at its base. Indeed, two ideas are at the heart of the WTO: liberalization of the market, and no discrimination of the trade partners herein. However, the notion of discrimination should first be defined, so as to guide us to its concretization in the frame of the WTO. In general, discrimination can be defined as the differential treatment of persons, actions or goods that are in analogue conditions. Often, the action of discrimination is based on prejudice. In the frame of the WTO, however, this very large notion becomes very specific. Indeed, the principle of non-discrimination holds two aspects: - Most Favored Nation Treatment (MFN): Each member must grant to every other member the most favorable treatment that it grants to any country with respect to imports and exports of products. It comes down to the principle of equal treatment of all WTO members. Specifically, there must be no discrimination in the fixation of import taxes (Art. (I GATT)) And no quota on the number of imports (XI GATT). - National Treatment (NT): Each member must treat foreign goods equal to domestic goods, once foreign goods have cleared customs and become part of the home market (Art. III GATT). This basically means that no differentiation must be done between the imported and the domestic product once they both are on the domestic market.

Extraits

[...] Qualification of the violation (either MFN or NT) It first must be determined which obligation of non discrimination was violated, either the MFN treatment or the NT. For this purpose, the question that must be raised is: the product already entered the home market?” If not, only the Articles I or XI must be examined (higher import taxes, MFN or quotas). If so, then it is the Article III that must be controlled (NT). The Art I GATT is in general not an issue. Moreover, as the present cases deal solely with Art. III GATT, our analysis will emphasize on this particular statute. B. [...]

[...] However, in cases of an extremely high difference, there is an irrefragable presumption of violation. In the case of Korea, it was found that the total tax on diluted soju is of 38.5 on distilled soju and liqueurs it is of 55 on vodka, gin, rum, tequila and ad-mixtures it is of 104 on whisky, brandy and cognac it is of The Panel thus concluded that these differentials are clearly in excess of de minimis levels, and the products at issue are therefore not similarly taxed. [...]

[...] Presentation of the facts, parties and issues: Complainants: EC. U.S. Respondent: Korea This dispute concerns Korea's tax regime for alcoholic beverages. Under the Liquor Tax Law of 1949, Korea created various categories of distilled spirits, on which it imposed different ad valorem sales tax rates. Under the Education Tax Law of 1982, Korea also assessed surtax on sales of these products, determined as a percentage of the rate established under the Liquor Tax Law. The European Communities and the United States argued that the tax rates applied under the Liquor Tax Law and the Education Tax Law are inconsistent with Article III:2 GATT, first and second sentences Claims and rulings Claim Korea is in breach of its obligations under Article III:2 GATT, first sentence, by applying internal taxes on imported vodka pursuant to the Liquor Tax Law and the Education tax which are in excess of those applied on soju. [...]

[...] The principle of non-discrimination in the world trade organization I. Introduction: What is non-discrimination in the frame of the WTO? The principle of non discrimination in the frame of the WTO[1] is one of the core principles at its base. Indeed, two ideas are at the heart of the WTO: liberalization of the market, and no discrimination of the trade partners herein. However, the notion of discrimination should in first place be defined, so as to guide us to its concretization in the frame of the WTO. [...]

[...] ) so as to afford protection to domestic production“. Directly competitive and substitutable products: Concerning the competitiveness of the products, it depends of different criteria, analyzed case by case, such as: physical characteristics of the products; their final use; the consumers' perception and behavior towards the products; tariff classification of the products. As for the substitutability of the products, it is appreciated similarly: as defined in the case of Korea, the products must be “interchangeable” or must offer “interchangeable means of satisfying a certain need or a particular taste”. [...]