Richard North, 24/08/2016  

Picking up on Monograph 8 on "WTO schedules of concessions", and my blogpost on the same subject, I have since been able to acquire a copy of a book mentioned in the text, a racy little number called The Law and Politics of WTO Waivers: Stability and Flexibility in Public International Law by Isabel Feichtner.

Feichtner is Assistant Professor of Law and Economics at Goethe University Frankfurt am Main but, despite that, she seems to know what she is talking about, on a subject which is of great importance even to the average Brexiteer – the "waiver" as a concept in international law.

The value of this stems from the very nature of international law, which in being the province of national executives, often lies outside the democratic law-making processes.

As such, says Feichtner, there is tension between international governance and domestic government, in particular between, on the one hand, the constant flux of societal preferences and realities and, on the other hand, the rigidity of traditional international law-making instruments, in particular international treaties.

The role of the WTO waiver – i.e. the power of the WTO Ministerial Conference to suspend any legal obligation of the WTO Agreement or the annexed Multilateral Trade Agreements – is thus vital.

It may be used to "flexibilise" international law and thus address the tensions between domestic needs and international requirements, defusing potential conflict by suspending the law before the tensions escalate to the point where nations may be forced to choose between one or the other.

What makes the waiver so special, though, is that it is a binding legal act which formally suspends legal obligations and thus allows for non-compliance without putting into question the law's validity. Effectively, it is a legal way of breaking the law.

In light of these characteristics, Feichtner observes, it is surprising that the waiver power and waiver decisions to date have not received much attention in the literature on the WTO and public international law in general. This is even more surprising, she adds, since the practice of granting waivers is extensive.

And there's the rub. The "waiver" is not an obscure corner of the WTO domain but a (relatively) frequently used instrument, employed to resolve tensions that might otherwise destroy the legitimacy of the WTO agreement, and force members to leave it.

It is in effect a pressure relief valve, applicable when all else fails and just as important to the functioning of a treaty as the real thing might be to a steam engine. And, although called by a different name, the waiver performs much the same function in a treaty as safeguard measures. These also exist in WTO law and have been subjected to a degree of scrutiny.

But where they have come under particular scrutiny is in relation to the EEA Agreement, where the safeguard measures can be used to suspend free movement provisions, and thereby provide exactly the role of the pressure relief valve.

Arguably, this was precisely the sort of thing that Mr Cameron was seeking in his "renegotiations", which were concluded on 18-19 February of this year. And had he been able to come up with something more convincing that marginal changes to benefits payable to immigrants, history may well have been different – as we've already observed.

What we didn't realise at the time was how closely the European Commission agreed with the British government that a safety valve was needed. What we missed in the European Council statement (tucked away on p.34) was a declaration from the European Commission.

Remarkably, this stated that the "proposed safeguard mechanism" was intended to cover "the type of exceptional situation" which exists in the United Kingdom today and, accordingly, "the United Kingdom would be justified in triggering the mechanism in the full expectation of obtaining approval".

This was a proposal to amend Regulation (EU) No 492/2011 on freedom of movement for workers within the Union, "to provide for an alert and safeguard mechanism that responds to situations of inflow of workers from other Member States of an exceptional magnitude over an extended period of time, including as a result of past policies following previous EU enlargements".

For some strange reason, neither the Commission nor the Council referred to the safeguard measures set out in Article 112 of the EEA treaty, although these ready-made provisions could have been used off-the-shelf, without waiting to amend Regulation 492/2011.

Perhaps the Commission had forgotten about the use of safeguard measures in treaties, too embarrassed to admit that such measures are common to most treaties. There had even been such measures in the Treaty of Rome (Article 115), surviving right through to the Nice Treaty (as Article 134), to be removed only by the Lisbon Treaty.

So it is that the "colleagues" have made a serious mistake (one of their many), locking members into a treaty without a safety valve, failing to realise the importance of such a provision. And, in its absence, the UK has opted for the exit.

Feichtner, therefore, has done us a favour – possibly unwittingly – in highlighting the value of these provisions which, until very recently, were virtually unknown to us. More common than we could have begun to imagine, they could play a vital role in the coming Brexit negotiations. 

Certainly, any exit settlement we agree with the EU will require its own safeguard measures, as did our original accession treaty.

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