UNIT III
WTO AGREEMENTS
e. Agreement on Safeguards
By:
Dr. Gargi Bhatt
Assistant Professor
DME Law School
UNIT III
OBJECTIVES & LEARNING OUTCOME
(i) To introduce the students to different
agreements under WTO.
(ii) To study and understand the need and
aspects WTO Agreement in the current
times.
SUGGESTED READINGS
(i) Raj Bhalla, International Trade Law:
Theory and Practice, Lexis Nexis, 2001 (
2nd Edn) 101
(ii) [Link], Guide to the WTO and GATT:
Economics, Law and Politics, Kluwer
Law International, 2006
(iii) Craig VanGrasstek, The History and the
Future of the WTO, WTO Publications,
2013
INTERNET REFERENCES
(i) [Link]
legal_e/sg_e.htm
(ii) [Link]
uard%20Presentation_Prof.%20Shash
ank%[Link]
(iii) [Link]
to-safeguards
INTRODUCTION
• The Agreement on Safeguards (“SG
Agreement”) sets forth the rules for
application of safeguard measures.
• Safeguard measures are defined
as “emergency” actions with respect
to increased imports of particular products,
where such imports have caused or threaten
to cause serious injury to the importing
Member's domestic industry.
STRUCTURE OF THE AGREEMENT
• The Agreement consists of 14 articles and 1
annex.
• In general terms, it has four main
components:
1. General Provisions (Articles 1 and 2);
2. Rules governing Members' application of new
safeguard measures (i.e., those applied after
entry into force of WTO Agreement (Articles
3-9));
STRUCTURE OF THE AGREEMENT
3. Rules pertaining to pre-existing measures that
were applied before the WTO's entry into force
(Articles 10 and 11); and
4. Multilateral surveillance and
institutions (Articles 12-14)
AGREEMENT ON SAFEGUARDS
(AoS)
• Overview: It is a World Trade Organization
(WTO) treaty that allows countries to
apply temporary trade barriers—called
safeguard measures—when a domestic
industry is harmed by a surge in imports.
• Purpose in Practice: The agreement
maintains global trade discipline, offering
legal protection tools but with checks to avoid
abuse.
AGREEMENT ON SAFEGUARDS
(AoS)
• Conditions for Use: Safeguards can only be
used when there is clear evidence of serious
injury or threat to domestic producers due to
increased imports.
• Rules-Based System: The agreement ensures
safeguard actions are transparent,
time-bound, and non-discriminatory,
preventing misuse for permanent
protectionism.
AGREEMENT ON SAFEGUARDS
(AoS)
Key Rules:
• Article 12.3: Before acting, a country must notify
and consult with other WTO members who may be
affected by the safeguard.
• Article 8: If consultation fails, the affected country
can retaliate by suspending trade benefits equal to
the loss it suffered.
• Ban on Informal Restrictions: AoS strictly prohibits
voluntary export restraints or informal quotas that
evade WTO rules, ensuring fairness.
India’s Use of the AoS – The 2025
U.S. Tariff Case:
• Trigger: The U.S. had imposed 25% tariffs on
Indian-origin vehicles and parts in March
2025, which India claims are safeguard
measures disguised as unilateral tariffs.
• Violation of Rules: India alleges that the U.S.
did not follow Article 12.3 (mandatory
consultations) and thus violated both AoS and
GATT 1994 rules.
India’s Use of the AoS – The 2025
U.S. Tariff Case:
• Impact on Indian Exports: India estimates
that $2.89 billion worth of exports have been
affected and that the U.S. collected
nearly $723.75 million in duties, matching
India’s proposed retaliation.
• India’s Justification: India asserts that this
move is legal under WTO rules, not
protectionist, and aims to defend its export
interests while continuing trade talks with the
U.S.
India’s Changing Role in WTO
Safeguard Policy:
• Early Strategy (1995–2010): India was
initially cautious at the WTO, accepting tough terms
under TRIPS, GATS, and AoA, and rarely used legal
tools like retaliation, focusing more on diplomatic
solutions.
• Recent Assertiveness (Post-2010): India
now actively invokes WTO rules like AoS to protect
its interests and has won key disputes, such as:
- The solar panel case against the U.S.
- Legal challenges to EU’s export restrictions on
food.
India’s Changing Role in WTO
Safeguard Policy:
• Global Leadership Role: India has taken the
lead among developing countries to protect
food security rights and push for fairer global
trade terms, especially at Bali
(2013) and Nairobi (2015) WTO summits.
Thank You