US tariffs 'for fentanyl' violate WTO rules

The United States' imposition of additional tariffs on China over the fentanyl issue are seemingly justifiable as a measure to protect public health and safety. Yet from an international trade law perspective, they lack valid arguments for exemption under the legal framework of the World Trade Organization (WTO).

The US additional tariffs ignore fundamental WTO obligations such as most-favored-nation (MFN) treatment and schedule of concessions. The US may cite Section 301 of its Trade Act of 1974 or Section 232 of its Trade Expansion Act to justify its unilateral actions, but domestic legal provisions do not guarantee exemption from WTO commitments.

In order to successfully invoke the exception clauses under the General Agreement on Tariffs and Trade (GATT 1994), particularly its Article XX (General Exception) and Article XXI (Security Exception), the US must demonstrate that its tariff measures are necessary and do not constitute arbitrary or unjustifiable discrimination on international trade. In line with the existing rulings of WTO precedents and interpretation of rules, it is hardly likely that the US can justify its measures with either general exception or national security exception.

Should the US proceed with them, members that are affected may initiate consultations within the WTO, request for the establishment of a panel to adjudicate the matter, or pursue trade retaliation in parallel, in accordance with the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU). Given the current global economic situation, a US that abuses unilateral tariff measures will render the multilateral trading system even less stable and predictable.

More critically, linking public health issues with tariff pressure does not play a positive role in drug flows control or transnational law enforcement cooperation. Rather, it only escalates political confrontation and hinders effective governance based on consultation and cooperation. The way out is comprehensive measures with shared responsibility, including cutting drug demand, collaborating in cross-border law enforcement, and enhancing multilateral cooperation, to find a more constructive plan for global counternarcotics governance.

As a responsible major country, China adopts the most rigorous controls over drug production, trafficking and abuse. It is the steady progress in China-US counternarcotics cooperation that represents the right way to solve the fentanyl problem. A headstrong US with its unilateral measures will undoubtedly undermine the authority and stability of the multilateral trading system and defy the call for joint response to global challenges in a globalized world. More importantly, unilateral tariff measures are far from striking at the root of the fentanyl crisis in the US. Major countries should act in a way that befits their status and refrain from actions that do no one good.

The author is a professor at School of Law, University of International Business and Economics.

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