22
1 The UK’s status in the WTO after Brexit Lorand Bartels * 23 September 2016 Introduction It has become conventional wisdom that once the UK leaves the EU it will have to renegotiate core aspects of its WTO rights and obligations, and in particular its concessions under Article II of the GATT 1994 and Article XX of the GATS. A leading exponent of this view is WTO Director-General Azevêdo, who said during the Brexit referendum campaign that ‘[the UK] will be a member with no country-specific commitments’. 1 For some, rather dramatically, the UK will, at least de facto, be in the position of a country seeking to accede to the WTO from scratch, 2 and that it will have to negotiate its terms of membership with all other WTO Members who will hold a veto over the outcome of these negotiations. 3 At a minimum, others have said, the UK will, at a minimum, have to negotiate its share of the EU’s commitment not to subsidise agricultural production above a certain level as well as its share of current EU preferential tariff rate quotas for certain agricultural products. 4 In addition, doubts have been expressed as to the UK’s rights to access the tariff rate quotas that other WTO Members have committed to allocate to the EU, 5 and it is generally taken for granted that the UK would have to accede as a new party to the plurilateral WTO * Faculty of Law, University of Cambridge ([email protected]). I am very grateful to Tomer Broude, Bill Davey, Lothar Ehring, Larry Elliot, Alberta Fabbricotti, Michael Fogden, Tom Grant, Christian Häberli, Holger Hestermeyer, Gary Horlick, David Kleimann, Andrew Lang, Petros Mavroidis, Federico Ortino, David Roberts, and Peter Ungphakorn for their help, comments and discussion. All opinions and errors remain mine. 1 Reported in Larry Elliot, ‘WTO chief says post-Brexit trade talks must start from scratch’, The Guardian, 7 June 2016, www.theguardian.com/business/2016/jun/07/wto-chief-brexit-trade-talks-start-scratch-eu-referendum. 2 Eg Piet Eeckhout, ‘Brexit and trade: the view over the hill’, 16 June 2016, https://londonbrussels.wordpress.com/2016/06/16/brexit-and-trade-the-view-over-the-hill/ (‘withdrawal from the EU is comparable to a full WTO accession, and accession negotiations can easily take years’); Erik Lagerlof, ‘Would the UK be able to rely upon the WTO agreement if it were to leave the EU?’, June 2016, https://www.matrixlaw.co.uk/wp-content/uploads/2016/06/Article-9-Dr-Erik-Lagerlof.pdf (‘[i]n the event of a departure from the EU, the UK would accordingly have to start its renewed relationship with the WTO from scratch’); Panos Koutrakos, ‘What does Brexit mean for the UK in WTO?’, 12 July 2016, www.monckton.com/brexit-mean-uk-wto/ (‘[t]he application … of WTO law on the UK following Brexit will depend on resetting the terms of the British membership in the Organisation’). 3 Eg Peter Ungphakorn, ‘Nothing simple about UK regaining WTO status post-Brexit,’ 27 June 2016, http://www.ictsd.org/opinion/nothing-simple-about-uk-regaining-wto-status-post-brexit (‘[i]t would only take one objection to hold up the talks because the WTO operates by consensus, not voting, one reason why WTO negotiations take so long’), Koutrakos, ibid, (‘[t]he schedules of concessions and commitments on market access, for instance, as well as the UK’s list of exemptions from the MFN treatment obligation would have to be reset and resubmitted. They would also have to be accepted by the other WTO parties’). 4 Richard Eglin, Piet Eeckhout, Uncorrected Oral Evidence, Brexit: future trade between the UK and the EU, Select Committee on the European Union – External Affairs and Internal Market Sub-Committees, 8 September 2016 (http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/eu- external-affairs-subcommittee/brexit-future-trade-between-the-uk-and-the-eu/oral/37864.pdf). 5 Eglin, Eeckhout, ibid.

The UK’s status in the WTO after Brexit - Peace Palace · The UK’s status in the WTO after Brexit Lorand Bartels* 23 September 2016 ... , Larry Elliot, Alberta Fabbricotti, Michael

Embed Size (px)

Citation preview

1

TheUK’sstatusintheWTOafterBrexit

LorandBartels*

23September2016

Introduction

It has become conventional wisdom that once the UK leaves the EU it will have to

renegotiatecoreaspectsofitsWTOrightsandobligations,andinparticularitsconcessions

underArticle IIof theGATT1994andArticleXXof theGATS.A leadingexponent of this

view isWTODirector-GeneralAzevêdo,who said during theBrexit referendumcampaign

that‘[theUK]willbeamemberwithnocountry-specificcommitments’.1Forsome,rather

dramatically,theUKwill,atleastdefacto,beinthepositionofacountryseekingtoaccedetotheWTOfromscratch,

2andthatitwillhavetonegotiateitstermsofmembershipwithall

otherWTOMemberswhowill holda vetoover theoutcomeof thesenegotiations.3At a

minimum,othershavesaid, theUKwill,ataminimum,havetonegotiate its shareof the

EU’scommitmentnottosubsidiseagriculturalproductionaboveacertainlevelaswellasits

share of current EU preferential tariff rate quotas for certain agricultural products.4 In

addition,doubtshavebeenexpressedastotheUK’srightstoaccessthetariffratequotas

thatotherWTOMembershavecommittedtoallocatetotheEU,5andit isgenerallytaken

for granted that the UK would have to accede as a new party to the plurilateral WTO

*FacultyofLaw,UniversityofCambridge([email protected]).IamverygratefultoTomerBroude,BillDavey,

Lothar Ehring, Larry Elliot, Alberta Fabbricotti, Michael Fogden, Tom Grant, Christian Häberli, Holger

Hestermeyer,GaryHorlick,DavidKleimann,AndrewLang,PetrosMavroidis,FedericoOrtino,DavidRoberts,

andPeterUngphakornfortheirhelp,commentsanddiscussion.Allopinionsanderrorsremainmine.

1ReportedinLarryElliot,‘WTOchiefsayspost-Brexittradetalksmuststartfromscratch’,TheGuardian,7June

2016,www.theguardian.com/business/2016/jun/07/wto-chief-brexit-trade-talks-start-scratch-eu-referendum.

2 Eg Piet Eeckhout, ‘Brexit and trade: the view over the hill’, 16 June 2016,

https://londonbrussels.wordpress.com/2016/06/16/brexit-and-trade-the-view-over-the-hill/ (‘withdrawal

from the EU is comparable to a fullWTOaccession, and accessionnegotiations caneasily take years’); Erik

Lagerlof, ‘Would theUK be able to rely upon theWTO agreement if itwere to leave the EU?’, June 2016,

https://www.matrixlaw.co.uk/wp-content/uploads/2016/06/Article-9-Dr-Erik-Lagerlof.pdf(‘[i]ntheeventofa

departurefromtheEU,theUKwouldaccordinglyhavetostart itsrenewedrelationshipwiththeWTOfrom

scratch’); Panos Koutrakos, ‘What does Brexit mean for the UK in WTO?’, 12 July 2016,

www.monckton.com/brexit-mean-uk-wto/ (‘[t]he application … ofWTO law on the UK following Brexit will

dependonresettingthetermsoftheBritishmembershipintheOrganisation’).

3 Eg Peter Ungphakorn, ‘Nothing simple about UK regaining WTO status post-Brexit,’ 27 June 2016,

http://www.ictsd.org/opinion/nothing-simple-about-uk-regaining-wto-status-post-brexit(‘[i]twouldonlytake

oneobjectiontoholdupthetalksbecausetheWTOoperatesbyconsensus,notvoting,onereasonwhyWTO

negotiations take so long’), Koutrakos, ibid, (‘[t]he schedules of concessions and commitments on market

access,forinstance,aswellastheUK’slistofexemptionsfromtheMFNtreatmentobligationwouldhaveto

beresetandresubmitted.TheywouldalsohavetobeacceptedbytheotherWTOparties’).

4RichardEglin, Piet Eeckhout,UncorrectedOral Evidence,Brexit: future tradebetween theUKand theEU,

Select Committee on the European Union – External Affairs and Internal Market Sub-Committees, 8

September 2016 (http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/eu-

external-affairs-subcommittee/brexit-future-trade-between-the-uk-and-the-eu/oral/37864.pdf).

5Eglin,Eeckhout,ibid.

2

GovernmentProcurementAgreement(GPA2014),6towhichtheEU–butnottheUK–isa

party,eventhoughthisagreementcoversUKpublicbodies.

It is contended here that, in different ways, these views are mistaken. As far as the

multilateralWTOagreementsareconcerned,itisnotedthattheUK’srightsandobligations

are not, as some have thought, contingent on its status as an EUMember. In fact, it is

argued(section1)thatwhatwillchangewithBrexitarenottheUK’sunderlyingrightsand

obligations,butrathertheEU’sexerciseoftheserightsandassumptionofresponsibilityfor

theperformanceoftheseobligations.ItfollowsthattheUK’srightsandobligationsare,asa

matterof legaltheory,complete,even if, insomecases,theyarepresentlyundetermined

(section2).Furthermore,identifyingtheserightsandobligationsisnotnecessarilydifficult.

Inthefirstplace,allWTOrulesthatapplytoWTOMembersonanergaomnespartesbasisalso apply to the UK without any further complications, along with all exemptions and

exceptions (section 2(a)). Among these ordinary rights is the UK’s right to access the

country-specificEUtariffratequotasboundbyotherWTOMembersundertheGATT1994,

even though, if theUK isnota substantial supplier, itmay inpractice losemarketaccess

under thosequotas (section2(b)). It ismoreadmittedlymorecomplicated to identify the

UK’s tariff rate quota commitments, at least in a way that does not lead to the EU-27

accessingthesequotasalongwithtraditionalthirdcountrysuppliers.However,theUKcan

act unilaterally to forestall any complaints, including non-violation complaints, by setting

andallocating tariff ratequotas in termsof recent imports fromall sources, including the

EU-27,aswell as thehistoricalexpectationsofotherWTOMembersat the time that the

quotas were initially agreed (section 2(c)). As for the right to subsidise agricultural

production,itissuggestedthattheUKbeallocatedasumcalculatedbyapplyingthecurrent

ratioofUK:EUsubsidypaymentstotheEU’sscheduledrights(section2(d)).

ThearticlenextlooksattheUK’sscheduledcommitmentsinservicesunderthejointGATS

scheduleoftheEUanditsMemberStates’GATS(section3).Thisscheduleraisesnoissues

concerningtheidentificationofcommitments,assuch.TheyapplydirectlytotheUK,which

submittedaGATSscheduleunderArticleXXof theGATS.Naturally,anyEUorUK-specific

limitations on these commitments are also transposed to the UK. However, there is a

question about the validity of a territorial limitation in the schedule, according to which

commitmentsonlyapply to territory towhichtheEUtreatiesapply.Strictlyspeaking, this

wouldleavetheUKdefactowithnoschedule,aresultthatisnotimpossible,butcertainly

undesirable.However,itissuggestedthatthiswouldbeawrongresult.Instead,inlinewith

the rule of customary international law concerning ‘moving frontiers’ in cases of state

succession,itissuggestedthatthisprovisionsimplybedisregardedasinapplicablewhenUK

territorynolongerfallsundertheEUtreaties.

Thenextsectionconsiderstheproceduralmechanismsthatshouldbeusedtoestablishthe

UK’scommitments innewschedulesofcommitments (section4). Itarguesthat, following

relevant practice in similar situations under the GATT 1947, the proper procedure to be

followed is for theUK to submit anew schedule, basedon the considerations above, for

certificationasa‘change’toanexistingschedule.ObjectionstocertificationbyotherWTO

6 Eglin, ibid, Eeckhout, ibid, Michael Bowsher, ‘Procurement law after Brexit?’, 16 March 2016,

http://publicsectorblog.practicallaw.com/procurement-law-after-brexit/.

3

Members should then be limited to questions of accuracy. However, even if there are

objections, which are to be expected, this section contends that these are of no legal

consequence,ascertificationisnotrequiredforaschedule,orachangeinaschedule,tobe

legally effective. For this reason, there is no basis for the assumption, noted above, that

otherWTOMembersholdanythinglikeavetoovertheUK’slegalpositionintheWTO.

The last issue addressed in this article concerns theUK’s legal position in relation to the

GovernmentProcurementAgreement2014(section5). It isarguedthattherearerulesof

customaryinternationallawonthesuccessionofstatesfromunionswithlegalpersonality,

as well as practice under the 1947 GATT, and that according to these rules the state

succeedstoanylegalrightsandobligationscontractedbythatunionthatwereapplicableto

that state or its territory. For this reason, it is contended that the UK succeeds to the

Government ProcurementAgreement in its ownname. In addition, however, this section

notesthatotherWTOMembershaveformallyrecognizedthattheEUactsonbehalfofits

Member Stateswithin the context of this agreement, and it argues that, for this reason,

otherWTOMemberswouldmostlikelybeestoppedfromdenyingaUKclaimtosuccession.

In short, this article concludes that, in substance, the position of theUKwithin theWTO

afterBrexitcan,iftheUKwishes,bethesameasitistoday.Theremaybecertainstatistical

andpoliticaldifficultiesinsettingthelegalpositionoftheUKwithintheWTO.Buttheredo

notappeartobeanythatarelegal(section6).

1. TheUK’sstatusasanoriginalWTOMember

On1January1995theUKbecameanoriginalWTOMemberpursuanttoArticleXI:1ofthe

WTOAgreement.Thisprovisionstates:

The contracting parties to GATT 1947 as of the date of entry into force of this

Agreement,and theEuropeanCommunities,whichaccept thisAgreementand the

Multilateral Trade Agreements and for which Schedules of Concessions and

Commitments are annexed to GATT 1994 and for which Schedules of Specific

CommitmentsareannexedtoGATSshallbecomeoriginalMembersoftheWTO.

ThisappliestotheUKinastraightforwardway.TheUKwasacontractingpartytotheGATT

1947 and it ‘accepted’ the WTO Agreement and the multilateral trade agreements, in

accordancewithArticleXIV:1oftheWTOAgreement,byratificationon30December1994.7

Further, the EU annexed a schedule of concessions to the GATT 1994 ‘for’8 the UK,

9 in

7Note1 to theMarrakeshAgreementEstablishing theWorldTradeOrganization (1995)1867UNTS155, in

force1January1995;alsoWTO,StatusofWTOLegalInstruments(Geneva:WTO,2015),at41.

8Paragraph1oftheMarrakeshProtocoltotheGeneralAgreementonTariffsandTrade1994(the‘Marrakesh

Protocol’) similarly describes its annexed schedules as ‘relating to’ WTO Members. Paragraph 1(d) of the

‘languageincorporatingGATT1947andotherinstrumentsintoGATT1994’makestheMarrakeshProtocolpart

oftheGATT1994.Foritspart,paragraph1oftheMarrakeshProtocolstatesthat‘[t]hescheduleannexedto

thisProtocolrelatingtoaMembershallbecomeaScheduletoGATT1994relatingtothatMember’.Bythese

means,ascheduleannexedtotheMarrakeshProtocolisdeemedtobeascheduleannexedtotheGATT1994,

andtherebymeetsthedescriptionsofannexedschedulesinArticleIIoftheGATT1994.

4

accordance with its practice since the UK joined the EU10 in 1974.

11 For the GATS the

situationisalittledifferent,inthattheEUanditsMemberStates,includingtheUK,jointly

submittedascheduleofspecificcommitments.12Accordingly,alloftheconditionssetoutin

ArticleXI:1havebeenmet for theUK, and theUKwill remains aWTOMemberunless it

withdraws from the WTO Agreement in accordance with Article XV of the WTO

Agreement.13

ArticleXI:1oftheWTOAgreementisanunusualprovision,althoughnotunique,14insofaras

it allows for the possibility that original WTO Members will not have autonomy in all

matterscoveredbytheWTOagreements,andwhichcontrastswithArticleXIIoftheWTO

Agreement,accordingtowhichnewlyaccedingWTOMembersmusthavefullautonomyin

thesematters. It is importantinthiscontexttonotethatautonomyisconcernedwiththe

power,underdomesticor internal law,ofagivenentitytoactonthe internationalplane.

Suchactsare,inprinciple,attributabletothatentityunderinternationallaw,althoughthere

arealsootherways inwhichactscanbeattributable toanentity (suchasadoption).But

neithertheautonomyofanentity,northequestionwhetheragivenactistobeattributed

to that entity, have anything do towith its rights and responsibilities under international

law.15Thatdependsentirelyonwhethertherulesarebindingonthatentity.

Againstthisbackground,themeaningofArticleXI:1canbebetterunderstood.Itrecognised

thattheEU(probably)anditsMemberStates(certainly)lackedfullautonomy,asamatter

9TheEEC-12scheduleattachedtotheMarrakeshProtocol,ibid,wasScheduleLXXX.ThecurrentcertifiedEU-15 Schedule CXL dates from 27 October 2012 (WT/Let/868, 30 October 2012). An EU-25 schedule was

submittedforcertificationon25April2014(G/MA/TAR/RS/357,25April2014).

10Forconvenience,thisarticleusestheterm‘EuropeanUnion’(EU),effectivebothgenerallyandintheWTO

(WT/Let/679)from1December2009,alsoforitspredecessors,theEuropeanCommunities(‘EC’)(1993-2009),

theEuropeanCoalandSteelCommunity(‘ECSC’)(1952-2002),andtheEuropeanEconomicCommunity(‘EEC’)

(1958-1992).

11TheUK’s schedule for itsmetropolitan territoryhadbeenScheduleXIX, SectionA,Parts I and II. TheEEC

withdrewtheschedulesoftheEEC-6andtheUK(andDenmarkandIreland)asof1August1974,andanew

EEC-9ScheduleLXXIIwascirculatedon6August1974.SeeGATT,ArticleXXIV:6Renegotiations–Entry into

ForceofSchedulesLXXIIandLXXIIbis,L/4067,6August1974.12EuropeanCommunitiesandtheirMemberStates–ScheduleofSpecificCommitments,GATS/SC/31,15April

1994.AnEU-25schedule(S/C/W/273,9October2006andS/C/W/273/Suppl.1,31October2006)wascertified

on18December2006(S/L/286,18December2006)butitsentryintoforcestilldependsonratificationbyall

EUMemberStates.ArticleXX:1oftheGATSstatesthat‘[e]achMembershallsetoutinaschedulethespecific

commitmentsitundertakesunderPartIIIofthisAgreement’.ThislanguageispersonaltoeachWTOMember,

andseeminglydoesnotpermitoneMembertosubmitaschedule ‘for’anotherMember,contrarytoArticle

XI:1 of theWTOAgreement.However, Article XVI:3 of theWTOAgreement states that ‘[i]n the event of a

conflictbetweenaprovisionofthisAgreementandaprovisionofanyoftheMultilateralTradeAgreements,

theprovisionofthisAgreementshallprevailtotheextentoftheconflict.’

13ItisalsopossibleforaWTOMembertobeexpelledifitrefusestoacceptcertainamendmentstotheWTO

agreementsunderArticleX:3andArticleX:5oftheWTOAgreement.

14 Article 3 of theUNCharter states that ‘[t]he originalMembers of theUnitedNations shall be the states

which … sign the present Charter and ratify it in accordance with Article 110.’ Among the 49 original UN

MemberswereBelarus,Ukraine,IndiaandthePhilippines,whichwerenotindependentstatesatthattime.15TheconceptsofattributionandresponsibilityinthiscontextaretypicallyconfusedbydiscussionsoftheEU

being ‘responsible’ for its Member States. See also Joni Heliskoski, ‘EU Declarations of Competence and

InternationalResponsibility’ inMalcolmEvansandPanosKoutrakos (eds),The InternationalResponsibilityoftheEuropeanUnion(Oxford:Hart,2013),at192-196.

5

oftheirdomesticandinternal law,tohaveschedulesofconcessionssubmitted‘for’them,

and thus tobecomeoriginalWTOMembers.16But ithasnothing todowith thequestion

whethermeasuresthatareformallyadoptedbyEUMemberStatescanbeattributedtothe

EU,andifso,whetherthisisonasharedorexclusivebasis.17Nordoesithaveanythingto

do with the question whether the EU or a given EU Member State has WTO rights or

obligations. That question can only be determined by looking at the rules, and in what

respecttheyarebindingontheEUoritsMemberStates.

In principle, when a state or an international organization conclude an agreement they

exercise rights andobligationsunder that agreement subject toany limitations setout in

thatagreement.Inthepresentcase,therearenosuchlimitations.Asjustexplained,Article

XI:1 is concerned with autonomy, not responsibility (or attribution).18 Nor is there any

suggestionanywhereintheWTOAgreement,orinanyrelevantinstruments,thattheWTO

rightsandobligationsoftheEUMemberStates,oroftheEU,areinanywaylimitedtotheir

areasofautonomy.19Indeed,thereareindicationstothecontrary.TheMarrakeshFinalAct

statesthat ‘theWTOAgreementshallbeopenforacceptanceasawhole,bysignatureor

otherwise,byallparticipantspursuanttoArticleXIVthereof,’20andArticleXVI:5oftheWTO

Agreementspecifiesthat‘[n]oreservationsmaybemadeinrespectofanyprovisionofthis

16 It was known that the EU Member States had no autonomy in the area of trade in goods, but it was

uncertainwhether theyalso lackedautonomy in theareasof servicesand intellectualproperty.On15April

1994theWTOAgreementwassignedseparatelybytheEUandtheEUMemberStates: at 16-42. On 15

November1994theEuropeanCourtofJusticedecidedthat,apartfromcross-borderservices,theEUandits

Member States possessed a shared competence forGATS and a joint competence for TRIPS:Opinion 1/94,paras98and105.On30December1994theEUanditsMemberStateseachacceptedtheWTOAgreementin

accordancewithArticleXIV:1oftheWTOAgreement:WTO,StatusofWTOLegalInstruments,aboveatn7,at16-42.Subsequenttreatychangeshavemeantthat,atpresent,exceptfortransportservices,allareascovered

by theWTO are nowwithin exclusive EU competence. SeeOpinion 1/08 (GATS) EU:C:2009:739 (GATS) andCaseC-414/11,DaiichiSankyoEU:C:2013:520(TRIPS).17Foranargument infavourofexclusiveattribution,basedonthedivisionofcompetencesbetweentheEU

and the EUMember States, see FrankHoffmeister, ‘Litigating against the EuropeanUnion and ItsMember

States—Who Responds under the ILC’s Draft Arts on International Responsibility of International

Organizations?’(2010)21EJIL723,at728and734andPieter-JanKuijperandEsaPaasivirta,‘EUInternational

ResponsibilityanditsAttribution:FromtheInsideLookingOut’inEvansandKoutrakos,aboveatn15,at60-

63. For an argument against, see Giorgio Gaja, ILC Special Rapporteur on responsibility of international

organizations,ThirdReport,UNDocA/CN.4/553,13May2005,para12and,expressingascepticalview,James

Flett, ‘TheWorldTradeOrganizationand theEuropeanUnionand itsMember States in theWTO’ inAndré

Nollkaemper and Ilias Plakokefalos (eds), The Practice of Shared Responsibility in International Law(Cambridge: CUP, 2016) at 896-97. See also WTO Panel Report, Russia – Tariff Treatment, WT/DS485/R,

circulated12August2016,para7.46,inwhichthePanelsaidthat‘theactofapplyingthedutyrates(i.e.the

levyingofdutiesatthetimeofimportation)isdirectlyattributabletoRussia’eventhoughRussiawasarguably

actingasanorganoftheEurasianEconomicUnion(EAEU)insodoing.18IwouldliketothankTomerBroudeforinsistinguponthispoint,andthedistinctionbetweenautonomyand

responsibilitymoregenerally.

19 As to whether the EU or its Member States could claim that their consent to be bound to the WTO

Agreement was invalid on the grounds that it was in manifest violation of a constitutional norm of

fundamental importance see Eva Steinberger, ‘‘TheWTO Treaty as aMixedAgreement: Problemswith the

EC’sand theECMemberStates’Membershipof theWTO’ (2006)14European Journalof International Law

837,at856-857.

20 Paragraph 4 of the Final Act Embodying the Results of the Uruguay Round of Multilateral Trade

Negotiations.

6

Agreement.’Moreover,theWTOAgreementreferstothevotesoftheEUMemberStates,

without limiting these to specific areas,when it states that ‘[t]henumberof votesof the

EuropeanCommunitiesandtheirmemberStatesshallinnocaseexceedthenumberofthe

member States of the European Communities.’21 The conclusion must be that the WTO

rightsandobligationsoftheEUanditsMemberStatesarethesameasthoseofanyother

WTOMember.22

Thisconclusionhasalsobeenendorsed inWTO jurisprudence. InEC/CertainMS–Airbus,thePanel rejectedanEU request to remove fiveEUMemberStates (including theUK)as

respondent,whichwould have left the EU as the sole remaining respondent. It said that

‘[e]ach of these five is, in its own right, a Member of theWTO, with all the rights and

obligations pertaining to suchmembership, including the obligation to respond to claims

madeagainstitbyanotherWTOMember’.ThePaneladdedthat‘[w]hateverresponsibility

the EuropeanCommunities bears for the actions of itsmember States does not diminish

their rightsandobligationsasWTOMembers,but is ratheran internalmatterconcerning

the relations between the European Communities and itsmember States.’23 The point is

clear,and,itissubmitted,correct.

It is worth noting that this conclusion does not transpose to all other so-called ‘mixed

agreements’oftheEUandtheEUMemberStates.Typically,thesetreatiesseektolimitthe

obligationsoftheEUandtheEUMemberStatestotheirrespectiveareasofautonomy(or,

in EU language, ‘competence’). There are several ways by which this is sought to be

achieved.One,commoninmultilateraltreaties,isbymakinga‘declarationofcompetences’

inrelationtothevarioussubjectmatterscoveredbythetreaty.24Anotheristodefinethe

‘parties’as‘theEU,ortheMemberStates,ortheEUandtheMemberStates,inaccordance

with their respective powers’.25 A third, more recent, innovation is to permit the EU to

determinetheproperrespondent inanyarbitralproceedings.26Thereismuchthatcanbe

said about these techniques, butwhat is presently important is that, in the absenceof a

statement,effectiveininternationallaw,thatlimitstherespectiveresponsibilitiesoftheEU

and its Member States under a given treaty, they will each be fully responsible for

21Footnote2ofArticleIX:1oftheWTOAgreement.

22PietEeckhout,‘TheEUanditsMemberStatesintheWTO–IssuesofResponsibility’ inLorandBartelsand

FedericoOrtino(eds),RegionalTradeAgreementsandtheWTOLegalSystem(Oxford:OUP,2006)at451.23WTOPanelReport,ECandCertainMemberStates–LargeCivilAircraft (Airbus),WT/DS316/R,adopted1

June2011,paras7.174-7.175.

24See,eg,Heliskoski,aboveatn15.

25 There has been virtually no academic commentary on these provisions. Hoffmeister considers that they

determineresponsibilityaccordingtowhetheratreatyprovisionspecifiesthatitrelatestoanEUorMember

Statecompetence,andthatincasesofsharedresponsibilityorsilenceboththeEUanditsMemberStates(or

State)mightberesponsible.SeeFrankHoffmeister, ‘TheContributionofEUPracticeto InternationalLaw’ in

MariseCremona(ed),DevelopmentsinEUExternalRelationsLaw(Oxford:OUP,2008),at65.26Article8.21oftheComprehensiveEconomicandTradeAgreement(CETA)betweentheCanadaandtheEU

and itsMember States (initialled 26 September 2016; revised version published 29 February 2016; not yet

signed(http://trade.ec.europa.eu/doclib/docs/2014/september/tradoc_152806.pdf)

7

performingthattreaty.27Atmost,onemightarguethattheirliabilitywouldbejointinterms

ofquantum,anissuewhichisoflittlerelevancetoWTOlaw.28

2. IdentifyingtheUK’sseparaterightsandobligations(a) Introduction

IftheUKalreadypossessesalloftherightsandobligationsofanoriginalWTOMember,it

willcontinuetopossessalloftheserightsandobligationsonceit leavestheEU.Whatwill

change is the EU’s role in exercising these rights and assuming responsibility for the

performanceoftheseobligations,arolewhichwillbehenceforthbeexercisedsolelybythe

UK. What remains is to identify the UK’s rights and obligations. This is relatively

unproblematicinrelationtoWTOrightsandobligationsthatapplyonanergaomnespartesbasis with respect to all WTO Members, or to WTO Members within an established

category, suchasdeveloping countries,orwhen theUK is specificallynamed.29Nomore,

therefore, needs to be said about the UK’s rights and obligations under the WTO

Agreement,theGATT1994(exceptforArticleII),theGATS(exceptforArticleXX),TRIPS,or

theDSU.

This said, questions arise in relation to rights and obligations concerning the UK’s

commitments under Article II of theGATT 1994 andArticle XX of theGATS, in particular

whenthesecommitmentsgivetheEU,byname,rightsorobligationsthatarequantified,for

example, in the form of quotas and money (such as the right to subsidise agricultural

production up to a certain amount). In these areas, itwould undoubtedly be practical to

arriveataninterpretationoftheUK’srightsandobligations,extractedfromtheEU’srights

andobligations,bynegotiation.However,thispracticalsolutionshouldnotobscurethefact

thatwhatisatissueistheproperidentificationofexistinglegalrightsandobligations,even

if this is adifficult task. In theabsenceofagreement, therewillbenoalternativebut for

disaffectedWTOMemberstoenforcetheirrightsinWTOdisputesettlementproceedings,if

they consider that the UK is not respecting these rights, or has otherwise nullified or

impairedbenefitsaccruingundertheGATT1994ortheGATS.

27Eeckhout,aboveatn22,at457.

28Atpresent, financialcompensation isnotawarded inWTOlaw,although itcanformpartofasettlement.

The question of quantum might also however be relevant for determining ‘appropriate countermeasures’

undertheSCMAgreement intermsoftheamountofaprohibitedsubsidyratherthanbythe injurycaused.

This approachwas adoptedby theArbitrator inBrazil – Aircraft (Article 22.6 – Canada),WT/DS46/ARB, 12

December2000,para3.60.But ithasnotbeen followed,however, interaliabecauseof thedifficulties that

would arise in the case of multiple complainants. See eg Arbitrator, US – FSC (Article 22.6 – US),WT/DS108/ARB, 30 August 2002, para 6.27.On joint and joint and several liability between the EU and its

MemberStatesintheWTO,seeFlett,aboveatn17.

29ThisincludesspecialsafeguardmeasuresintheformofincreasedcustomsdutiesaspermittedunderArticle

5 of the WTO Safeguards Agreement. The latest available figures are for the marketing year 2012/2014,

showingtheactivationofprice-based(butnotvolume-based)specialsafeguardmechanismsforpoultryand

sugar products: see WTO Committee on Agriculture, Notification – European Union (special safeguard

measures),G/AG/N/EU/19,4May2014.

8

(b) TheUK’sshareoftariffratequotasofotherWTOMembers

ThefirstquestionconcernstheidentificationoftheUK’sshareoftariffratequotasoffered

by otherWTOMembers to the EU on a country-specific basis, such as theUS tariff rate

quota for cheese. Article XIII:2 of the GATT 1994, which applies to tariff rate quotas,30

permits an importing WTO Member to allocate quotas, in the first instance on a non-

discriminatorybasis.31However,ArticleXIII:2(d)alsooffersanimportingWTOMemberthe

optionofreachingan‘agreementwithrespecttotheallocationofsharesinthequotawith

all other contracting parties having a substantial interest in supplying the product

concerned’ or to allocate a quota to such parties based on their share of total imports32

duringaprevious representativeperiod,33 ‘dueaccountbeing takenofanyspecial factors

whichmayhaveaffectedormaybeaffectingthetradeintheproduct.’34Asbetweenthese

two options, there is a clear incentive for WTO Members with a substantial interest in

supplyingagivenproducttoreachanagreementontheallocationofaquota,becausesuch

anagreementdoesnotneedtotakeanyaccountofimportsfromWTOMemberswithouta

substantialinterestorfromnon-WTOMembers.35Thisisbecause,intheabsenceofsuchan

agreement,animportingWTOMemberispermittedtoallocatethosesharesbothtoWTO

Memberswithoutasubstantialinterest36andtonon-WTOMembers,

37providedthatitdoes

soonanon-discriminatorybasisvis-à-vis the ‘other’WTOMemberswithouta substantial

interest.38

Forpresentpurposes,theimportantpointisthattheUKhasarighttoaccessanotherWTO

Member’stariffratequotawhenithasasubstantialinterestinthoseexports.Italsohasa

right to access a quota, on a non-discriminatory basis, when that WTO Member has

allocatedpartofthatquotatoanyWTOMemberwithoutasubstantialinterestortonon-

WTOMembers.Ofcourse,thismaynotleadtoaperfectresult.Itcouldbethat,unbundled

fromtheEU’sexportsasawholetheUK’sexportswillbesufficiently lowthattheUKwill

not have a substantial interest guaranteeing it a share of the quota. But that is a

commercial,notalegalproblem.

30ArticleXIII:5oftheGATT1994.

31 Article XIII:2(a) of the GATT 1994. Article XIII:2 aims to ‘mimic’ the comparative advantages of all WTO

Membersproducing likeproductswhichmightparticipateunderaquota:WTOAppellateBodyReport,EC–BananasIII(Article21.5–EcuadorII/US),WT/DS27/AB/RW2/ECU,adopted22December2008,para338.

32WTOAppellateBodyReport,EC–Poultry,WT/DS69/AB/R,adopted23July1998,para106.

33 The representative period is undefined, but is usually the previous three years:WTO Panel Report,EC –

Bananas III, adopted 25 September 1997, para 7.94. Theremay however be special circumstances, such as

market distortions, in which case other periods may be used: WTO Arbitrator, EC – Bananas III,WT/DS27/ARB/US,9April1999,paras5.29-5.33.

34ArticleXIII:2(d)hasbeencalledalexspecialistoArticleXIII:1oftheGATT1994.SeeWTOPanelReport,EC–

BananasIII,WT/DS27/R,ibid,para7.75.

35Suchagreementsareonlyeverprovisional,andaresubjecttorevisionintheeventthatanyWTOMember,

neworotherwise,acquiresorincreasesitssubstantialinterestinsupplyingtheproductsconcerned.SeeWTO

PanelReport,EC–BananasIII,aboveatn33,para7.92.36WTOPanelReport,EC–BananasIII,ibid,para7.75.

37WTOPanelReport,EC–Poultry,WT/DS69/R,adopted23July1998,para230,n140.

38WTOPanelReport,EC–BananasIII,aboveatn33,para7.75. Itremainsunclearwhether it ispossibleto

leavethe‘other’sharesunallocated,orwhethertheymustbeallocatedtoWTOMemberswithasubstantial

interest,ortothosewithoutasubstantialinterest.

9

(c) TheUK’sshareofEU’simporttariffratequotas

A more complicated question concerns the identification of the UK’s commitment to

provide certain country-specific tariff ratequotasas listed in theEU’sexisting schedule.39

Therearetwopracticalsolutions.OnewouldbefortheUKtobindacommitmenttocover

allproductscurrentlythesubjectofanEUtariffratequotaatthedutyrateofthatquota;

theotherwouldbefortheUKtoreachanagreementwithallsuppliers,orallsupplierswith

a substantial interest,whichwould then be protected under the first sentence of Article

XIII:2(d)oftheGATT1994.ItismoredifficulttodeterminetheUK’slegalobligationsinthe

absenceofeitherofthesepracticalsolutions.

Thissaid, it is importanttonotethattheUKhasexisting legalobligations inrespectof its

shareof thetariff ratequotassetout in theEUschedule.Fundamentally, then,as theEU

scheduleispartoftheGATT1994,40thisisaquestionoftreatyinterpretation,whichmeans

that the task of identifying the UK’s tariff rate quota obligations is to determine the

commonunderstandingofallWTOMembersatthetimetheEUtariffratequotaswerelast

incorporated as an integral part of the GATT 1994.41 The key question iswhether itwas

agreed,or,more likely, assumed thatEUMemberStateswouldnothaveaccess to those

quotas.Ifthisisthecase,whichisalmostcertain,theUK’scommitmentsinrespectofthe

EU’stariffratequotacanbereadtoexcludeEU-27imports.However,thisdoesnotdispose

of the issue, because schedules cannot override otherWTO obligations, including Article

XIII:2(d)oftheGATT1994.42Thismeansthat,providedthatthereisnootherbasisonwhich

theEU-27exportsthoseproductstotheUK,suchasafreetradeagreementorawaiver,43

that,asanordinaryWTOMember,theEU-27wouldhavearighttoaccessanyUKtariffrate

quota for any product for which it has a substantial exporting interest. That, of course,

reducesthevalueofanytariffratequotaforothersuppliers.

39 See above at n 9 for the EU’s schedules. Existing tariff rate quotas are notified in WTO Committee on

Agriculture,Notification–EuropeanUnion(tariffratequotas:imports),G/AG/N/EU/30,2September2016and

WTO Committee on Agriculture, Notification – European Union (tariff rate quotas: administration),

G/AG/N/EU/31,2September2016.Quotaswerefilledabove70%forthefollowingproducts,notallofwhich

are produced in the UK: beef, lamb, chicken, turkey, garlic, millet, sugar, cheddar, potatoes, carrots and

turnips, sweet peppers, dried onions, grapes, apples, pears, almonds, maize, rice, manioc starch, pasta,

chocolate,cereals,preservedfruit,fruit juices,wine,corngluten,dog,catandcertainanimalfeed:WTOdoc

G/AG/N/EU/30,ibid.

40ArticleII:7oftheGATT1994.

41ThiswouldbeinaccordancewiththeintroductorylanguageoftheGATT1994or,later,inaccordancewith

ArticleII:7oftheGATTdirectly.Itshouldbenotedthat,asitamountstoatreatyrevision,thecriticaldatefor

interpreting a schedule is the date of its certification or, failing that, its latest legal revision (onwhich see

belowattextton87),nottheearlierdatethatthequotawasfirstagreed,whichisrelevantforanon-violation

complaint:WTOAppellateBodyReport,EC–Computer Equipment,WT/DS62/AB/R, adopted22 June1998,

para150.

42InWTOAppellateBodyReport,EC–Poultry,aboveatn32,paras96(andalso96-102),theAppellateBody

stated that a tariff rate quota resulting from a renegotiation of a concession under Article XXVIII was still

subjecttothenon-discriminationruleinArticleXIII.

43GATT1947PanelReport,EEC–Newsprint,L/5680,adopted20November1984,para55;WTOArbitrator,EC

–BananasIII,aboveatn33,para5.8.

10

Therearevariousoptionswhichcouldcounteractsucharesult.Onewouldbetoconcludea

free tradeagreementwith theEUproviding forduty freeaccess to theproductsat issue.

Another would be to treat the UK’s withdrawal from the EU as a ‘special factor’ that,

according toArticle XIII:2(d), can justify adjustments to the allocationof shares basedon

global tradepatterns.Suchan interpretationwouldallowtheEUtobeexcludedfromthe

allocation of the quota. However, the Note to Article XI, which is applicable to Article

XIII:2(d),44 indicates that ‘special factors’ relate to changes in productive capacity, not

changesofa legalnature.Second,andrelatedtothis,theresultofsuchan interpretation

wouldbetonullifytherights,underArticleXIII:2(d),ofanyWTOMemberleavingacustoms

uniontoaccessatariffratequotaagreedwhenthatWTOMemberwasamemberofthat

customsunion.Thiswouldbearesultwithsignificantsystemicimplications.

Anotherpossibility isto ignorethequestionoftheUK’s legalobligations,andfocusrather

onthereasonableexpectationsof thetraditional importersunderatariff ratequota.This

canbedonebymeansofanon-violationcomplaintagainsttheUKunderArticleXXIII:1(b)of

theGATT1994,basedonaclaimthattheUKhasnullifiedorimpairedbenefitsaccruingto

that complainant under the GATT 1994 by a measure, regardless of whether or not it

violatedaWTOrulethatwasnotreasonablyexpectedatthetimethatthetariffratequota

wasnegotiated.

Suchaclaimwouldhavetosatisfyseveralconditions.Itwouldneedtobeestablishedthat

theUK’sleavingtheEU,anditsconsequentnewschedule,nullifiedbenefitsaccruingtothat

WTOMemberunderArticleXIIIoftheGATT1994.AsquotasharesunderArticleXIII:2are

subject to fluctuation, a disaffected WTO Member could not have had any reasonable

expectationofexportinganygivenquantitiesunderthetariffratequota.However,itismay

be that itwasnotexpectedat the time the tariff ratequotawasagreed thatnon-UKEU

importswouldbeallocatedsharesofthatquota.45Second,themeasureatissuemusthave

beenreasonablyunexpectedatthetimethetariffratequotawasagreed.Thiswouldbethe

caseforanytariffratequotaagreedatmostbetween6August1974,thedateofcirculation

of the firstEUschedule includingtheUK,46andthedatewhenthatWTOMembercanbe

said to have been aware of the possibility that the UK might leave the EU.47 Any such

expectationswouldalsohavetobelimitedtoimportsintotheUKfromEUMemberStates

atthetimetherelevanttariffratequotawasagreed.Iftheseconditionsaremadeout,then

acomplainingWTOMemberwouldbeentitledtoamutuallysatisfactoryadjustment,which

may include compensation.48 If successful, that complainant would then be entitled to a

44TheNoteAdArticleXIII:4oftheGATT1994makesacrossreferencetotheNoteAdArticleXI,whichstates

that ‘[t]heterm“special factors” includeschanges inrelativeproductiveefficiencyasbetweendomesticand

foreign producers, or as between different foreign producers, but not changes artificially brought about by

meansnotpermittedundertheAgreement’.

45WTOPanel Report,EC–Poultry, above at n 37, para 293, noting thatBrazil hadnotmade such a claim,

suggestingimplicitlythatitmighthavemadesuchaclaim.

46WTOPanelReport,Japan–Film,WT/DS44/R,adopted22April1998,paras10.64-10.70.

47Thatdatemightbe,attheearliest,1December2009,thedateofentryintoforceoftheTreatyonEuropean

Union,Article50ofwhichprovidesforthepossibilityofanEUMemberStateleavingtheEU,or25April2013.

Itmightalsobesomewhatlater,on23June2016,whentheUKvotedtoleavetheEU,butarguablynolater

thanthatdate.

48Article26(1)(b)and(d)oftheWTODisputeSettlementUnderstanding.

11

‘mutuallysatisfactoryadjustment’fromtheUK,whichwouldmostlikelybeachievedbyan

increaseintheUKtariffratequotatoincludeimportsfromtheEU-27imports(or,perhaps,

onlyfromthoseEUMemberswhowereMembersatthetimethatthetariffratequotawas

agreed).

Basedonthisanalysis,itwouldbeprudentfortheUKtobind,unilaterally,tariffratequotas

on products covered by existing EU tariff rate quotas based on imports from all sources,

includingtheEU-27,overarepresentativeperiodofthreeyears.49

(d) TheUK’sshareoftheEUagriculturalsubsidycommitments

A next question concerns the UK’s share of the EU’s commitment not to subsidise

agriculturalproductionbeyondagivenannualquantum,or,todescribethisfromtheother

direction,theUK’sshareoftheEU’slibertytosubsidiseuptothatquantum.Inreality,this

questionisunlikelytobeverycontroversial,50astheEU’sactualdomesticsubsidiesareonly

7%of its scheduledamount51and theEUhasalreadyabolishedexport subsidies,

52 in line

withthe2015WTONairobiMinisterialDecisiononExportCompetition.53Nonetheless,the

theoreticalquestionremains.

Onceagain,WTOlawsuppliesnodirectrulesorprinciplesfordeterminingtheUK’sshareof

asharedlibertytosubsidiseagriculturalproduction.Onemightwonderwhethertheorigins

of the UK’s and EU’s respective subsidy commitments would be a suitable basis for this

calculation.Aswithtariffratequotas,thismightberelevantwithrespecttoanon-violation

complaint.Giventhereductionincommitmentsovertime,however, it isunlikelythatany

WTOMemberwouldmakesuchaclaim.AmorerealisticoptionwouldbebasedontheUK’s

existingsharesoftheEU’ssubsidisationpolicy,eitherintermsofits(higher)contributions

or its (lower) receipts.54 As between these two options, given that the purpose of the

commitmentsistoreducedistortionsinthedomesticmarketplace,itissuggestedthatthe

strongerbasisfordeterminingtheUK’srighttosubsidisewouldbetheUK’sreceiptsfrom

the EU’s Common Agricultural Policy (CAP), rather than its contributions to that policy,

49 See above at n 33. An interesting question, raised by David Roberts, concerns the appropriate date for

determining a currency conversion should the UK wish to convert specific duties from euros/quantity to

sterling/quantity.

50 Alan Matthews, ‘WTO dimensions of a UK “Brexit” and agricultural trade’, http://capreform.eu/wto-

dimensions-of-a-uk-brexit-and-agricultural-trade/, 5 January 2016. Statistical issues resulting from transit of

products to the UK via other EU ports (the ‘Rotterdam issue’) may add a certain practical difficulty. See

Yorkshire Agricultural Society, The Implications of ‘Brexit’ for UK Agriculture, 2016,

http://yas.co.uk/uploads/files/YAS_FSN_Brexit_-_Full_Report.pdf,at29.

51 In themarketing year 2012/13, domestic supportwas€5.9bnof apossible €72.3bn:WTOCommitteeon

Agriculture,Notification–EuropeanUnion,WT/G/AG/N/EU/26,2November2015.52 In themarketing year 2014/2015, export subsidy commitments were zero out of a possible €8bn,WTO

CommitteeonAgriculture,Notification–EuropeanUnion,G/AG/N/EU/29,20May2016.

53WTOMinisterialConference,DecisiononExportCompetition,19December2015,WT/MIN(15)/45,para6.

For discussion of the legal value of this decision see Lorand Bartels, ‘The Relationship between the WTO

AgreementonAgricultureandtheSCMAgreement:AnAnalysisofHierarchyRulesintheWTOLegalSystem’

(2016)50JournalofWorldTrade7,at17-19.

54LarsBrink, ‘UKBrexitandWTOfarmsupport limits’,13July2016,http://capreform.eu/uk-brexit-and-wto-

farm-support-limits/.

12

whicharebasedontheUK’sshareofEUgrossnationalincome.55Itisthereforesuggested

thattheUK’ssubsidycommitmentbecalculatedastheratioofUK:EUCAPpayments(overa

representativeperiodofthreeyears)appliedtotheEU’stotalsubsidycommitments.56

3. TheUK’sGATSschedules

AnextquestionconcernstheUK’scommitmentsunderArticleXXoftheGATS.57Theseare

generic,subjecttolimitationsonanEUMemberStatebasis.Thesecaneasilybetransposed

toanewexclusiveUKGATSschedule.

Thereishoweveraslightlynicheissueconcerningtheterritorial limitationtotheschedule

annexedbytheEUandtheUKtotheGATS,accordingtowhich‘[t]hespecificcommitments

inthisscheduleapplyonlytotheterritoriesinwhichtheTreatiesestablishingtheEuropean

Communities are applied and under the conditions laid down in these Treaties’.58 Read

strictly,thisclausewouldhavetheeffectthat,afterleavingtheEU,theUKwouldhaveno

realcommitments,asitscommitmentswouldapplytoaterritoryinrespectofwhichithas

nojurisdiction.ThiswouldleadtothesituationthattheUKwouldpossessallrightsandergaomnes partes obligations, but it would have no obligations in relation to specificcommitments under theGATS. This is not impossible. It appears to be assumed that the

WTOagreementsapplytoterritoriesofWTOMembersthatarenotsubjecttoaschedule

(such as the Faroe Islands, a dependency of Denmark).59 Nonetheless, this might risk a

situationofrebussicstantibus,andinanycaseadifferentoutcomeseemsmorelikely.

This outcome is based on the principle of customary international law that a treaty only

bindsastateinrespectofitsterritory‘unlessadifferentintentionappearsfromthetreaty

or is otherwise established’.60 It might be arguable that the territorial application clause

representsjustsuchadifferentintention.61However,itisreadilyapparentthatthisclause

waspredicatedupon theEUMember States continuingas such. It is therefore suggested

that, once the UK leaves the EU, that clause be read either as applying to UK territory

55Ifonewerepreparedtodrawananalogybetweenarighttosubsidiseagriculturalproductionandmovable

propertyrelatedtoterritory,thiswouldalsoaccordwiththeruleintheViennaConventiononSuccessionof

StatesinRespectofStatePropertyprovidingthat‘movableStatepropertyofthepredecessorStateconnected

withtheactivityofthepredecessorStateinrespectoftheterritorytowhichthesuccessionofStatesrelates

shallpasstothesuccessorState’.Art14(2)(b)andArt15(1)(d)ofthe1983ViennaConventiononSuccessionof

StatesinRespectofStateProperty,ArchivesandDebts(done8April1983,notyetinforce).

56In2015,theUK’sshareofCommonAgriculturalPolicyreceiptswas6.7%.SeespreadsheetattachedtoAlan

Matthews, ‘Impact of Brexit on CAP budget net balances for remaining Member States’, 5 August 2016,

http://capreform.eu/impact-of-brexit-on-cap-budget-net-balances-for-remaining-member-states/ at

https://drive.google.com/file/d/0B6KoZ_bJBQHYbzQ0cFNsMG5VTGc/view?usp=sharing.

57EuropeanCommunitiesandtheirMemberStates–ScheduleofSpecificCommitments,GATS/SC/31,above

atn12.

58ibid.

59 Matthew Kennedy, ‘Overseas Territories in the WTO’ (2016) 65 International and Comparative Law

Quarterly741,at745.

60Article29oftheViennaConventionontheLawofTreaties,(openedforsignature23May1969;enteredinto

forceon27January1980)(1980)1155UNTS331.

61SchedulesofconcessionsareanintegralpartoftheGATT1994,accordingtoArticleII:7ofthisagreement.

13

describedinthatclause,orelseignoredentirely,withtheresultthattheUK’scommitments

wouldextendtoallUKterritoryunlessexpresslylimited.

Thisisnotasradicalasuggestionasmightbethought.Accordingtothe‘movingfrontiers’

principle,aruleofcustomary international law,62whenterritorypasses fromonestateto

another,thetreatiesoftheformerstateceasetoapplytothatterritoryandthetreatiesof

the latter state commence applying to that territory. Importantly, this rule includes

limitationson treaties, suchas reservations,63and there isno reasonwhy this rulewould

not likewiseapplytoterritorial limitations.Theresult,whichaccordswithcommonsense,

would be that the territorial application clause in the current EU schedule would simply

ceasetoberelevanttotheUKonceitleavestheEU,andthiscouldbereflectedbymeansof

arectificationtothatschedule.

In any case, onemight doubt whether, in practice, this territorial application is likely to

causemuchcontroversy.Asarule,WTOMembersareunlikelytocomplainthataschedule

coverstoomuch,ratherthantoolittle.Forexample,whentheUKnotifiedtheWTOthatits

commitments now covered the Isle of Man, it made no exception for services64

notwithstandingthefactthattheEUtreatiesdonotapplytotheIsleofManinrespectof

services,65andthispassedwithoutanyobjectionsbyanyotherWTOMembers.

4. Proceduresforrectifyingandmodifyingschedulesofconcessions

TheseconsiderationsinformtheprocedureapplicabletotheUKinannexingnewschedules

totheGATT1994andtheGATS.

ThecurrentprocedureformakingchangestoaGATT1994scheduleissetoutinthe1980

Decision on Procedures for Modification and Rectification of Schedules of Tariff

Concessions,66 which is binding as part of the GATT 1994.

67 This Decision distinguishes

betweenmodifications, on theonehand, and ‘other changes,’ on theother. Paragraph1

describesmodifications,relevantly,asfollows:

62 The ‘moving frontiers’ rule is codified in Article 15 of the 1978 Vienna Convention on the Succession of

States inRespectofTreaties (1978)1946UNTS3, in force6November1996. In1990Germanynotified the

GATT1947contractingpartiesthatitwasnowapplyingtheGATT1947totheterritoryoftheformerGerman

DemocraticRepublicandEastBerlin,which ithadabsorbed.SeeGATTDocL/6759,31October1990.There

werenoobjections.

63 First report on succession of States in respect of treaties, by Sir Francis Vallat, Special Rapporteur,

InternationalLawCommission,CommentarytoArticle14[later15],UNDocA/CN.4/278(1974)II(1)Yearbook

oftheInternationalLawCommission1,at210,para11.

64ConfirmedbyemailcommunicationwiththeUKForeignandCommonwealthOffice.

65Article355(5)(c)of theTreatyon theFunctioningof theEuropeanUnion,discussed in FionaMurray,The

EuropeanUnionandMemberStateTerritories(TheHague:TMCAsser,2012),at152.

66GATTContractingParties,ProceduresforModificationandRectificationofSchedulesofTariffConcessions,

Decisionof26March1980,L/4962.

67IntroductorylanguagetotheGATT1994,para1(b)(iv).

14

Changes in the authentic texts of Schedules annexed to the General Agreement

whichreflectmodificationsresultingfromactionunderArticleII,ArticleXVIII,Article

XXIV,ArticleXXVIIorArticleXXVIIIshallbecertifiedbymeansofCertifications.

It is notable that each of the provisions listed in this paragraph is concerned with

negotiations following a desire of aWTOMember to increase duties or other barriers to

trade.ArticleII:5grantsanaffectedWTOMemberarighttoconsultanotherWTOMember

if the first Member considers that a product is not receiving the expected treatment

contemplated by a concession; Article XVIII grants developing country WTO Members a

right to raise trade barriers for the purposes of infant industry production, subject to

compensation; Article XXIV:6 refers to the procedure in Article XVIII for WTO Members

wishingto increaseasaresultof formingaregional tradeagreement;ArticleXXVIIgrants

WTOmemberstherighttowithdrawingorwithholdingconcessionsinitiallynegotiatedwith

a party that never became or ceased to become a WTO Member; and Article XXVIII

establishesaright foraWTOmemberwishingtomodifyorwithdrawaconcession,anda

mechanism forconsultingandnegotiatingcompensationwithcertainotheraffectedWTO

Members.Consequently,infact,subsidycommitmentscannotbe‘modified’,becausethey

cannotbeincreased.68

Bycontrast,paragraph2ofthe1980Decisiondescribesother‘changes’asfollows:

Changes in the authentic texts of Schedules shall bemadewhen amendments or

rearrangements which do not alter the scope of a concession are introduced in

national customs tariffs in respect of bound items. Such changes and other

rectificationsofapurelyformalcharactershallbemadebymeansofCertifications.

Itisalittlenoticedfactthatparagraph2describesnotonlyformalrectifications,whichare

concernedwith accuracy, but also ‘other amendments and rearrangementswhichdonot

alter the scope of a concession’. Given that paragraph 1 is concernedwithmodifications

thatnegativelyaffect concessions, it is submitted that thisphrasemust refernotboth to

changes that are neutral, and to those that lead to improvements to bound concessions.

Support for this proposition may be found in the parallel GATS Council Decision, which

distinguishesbetweenordinarymodificationsunderArticleXXIof theGATS,69on theone

hand,and ‘modifications…whichconsistofnewcommitments, improvements toexisting

ones,orrectificationsorchangesofapurelytechnicalcharacterthatdonotalterthescope

orthesubstanceoftheexistingcommitments’.70Objectionstoordinarymodifications,ifnot

withdrawn, leadtoarbitrationtodetermineappropriatecompensation,71whileobjections

tomodifications that do not alter schedules, at least initially, lead to revised versions of

68BernardHoekmanandPetrosMavroidis,‘MFNClubsandSchedulingAdditionalCommitmentsintheGATT:

LearningfromtheGATS’,EUIWorkingPaperRSCAS2016/6,at8n24.

69 WTO Council for Trade in Services, Procedures for the Implementation of Article XXI of the General

AgreementonTradeinServices(GATS)(ModificationofSchedules),19July1999.

70 WTO Council for Trade in Services, Decision on Procedures for the Certification of Rectifications or

Improvements to Schedules of Specific Commitments, adopted 14 April 2000, S/L/83, 18 April 2000. The

ProceduresaresetoutinS/L/84,18April2000.

71ArticleXXI:3(a)oftheGATS.

15

non-alteringmodifications,72although,ifobjectionspersist,modificationssubmittedasnon-

alteringaretreatedasordinarymodifications,73andthereforealsoresultinarbitration.

Thereis,admittedly,adifficultywiththisproposition,whichliesinthefactthat,atleastin

thecontextoftheGATT1994,ithasbeenflatlycontradictedbytheAppellateBody.InEC–BananasIII(Art21.5–EcuadorII/US),theAppellateBodysaid:

Theordinarymeaningoftheterm‘modify’appearstoincludeboththesituationin

whichthescopeofaconcessionisreduced(forexample,atariffincrease)andwhen

thescopeisexpanded(forexample,atariffreduction).74

Itissubmitted,however,thattheAppellateBodyiswrong.Thisisbecauseitfailstorespect

the basic fact that renegotiations of concessions are intended to maintain the expected

benefitsofthoseconcessionsoverall,evenifnewconcessionsaremadeindifferentsectors

asaresult.75Itthereforemakesnosensetosaythatchangestoaschedulearetobeseenas

‘modifications’ when those benefits are not in question, still less when they are being

improved. Indeed, the Appellate Body itself seems to recognise this, implicitly, in the

sentence following that just quoted. It said ‘whether the proposedmodification actually

constitutes a reduction or an expansion of the concessionmay only become clear in the

course of the renegotiations’.76 While seemingly supportive, this sentence actually

undermines its approach because as it is based on the assumption that the proposed

reductionofaconcessiontriggerstheneedforrenegotiations.Buttheonlydamagecaused

byaloweredtariffisinthecontextofpreferenceerosion,whichisnotabenefitprotected

by the WTO.77 At most, and sensibly, this sentence recognises that there can be

disagreement about whether a proposed change does, in fact, reduce the scope of a

concession.Butthisisanargumentaboutambiguity;itisnotanargumentthatanychange

countsasa‘modification’.78

EveniftheAppellateBodyrulingissound,it issuggestedthatthereshouldbeacarveout

for new schedules scheduled by newly autonomous WTO Members, based on practice

72WTOCTS,S/L/84,aboveatn70,para3.

73Ibid,para3.

74WTOAppellateBodyReport,EC–BananasIII(Article21.5–EcuadorII/US),aboveatn31,para450.

75 PetrosMavroidis,TheRegulationof International Trade, Vol 1, TheGATT (Cambridge,MA:MIT, 2015) at

374.

76WTOAppellateBodyReport,EC–BananasIII(Article21.5–EcuadorII/US),aboveatn31,para450.

77TheGATT1947PanelReport,Germany–Sardines,G/26,circulated31October1952,notadopted,foundin

favour of a nonviolation complaint due to preference erosion on sardines due to the lowering duties on

herring and sprats. The reason for the report, however, was specifically that Germany had assured the

complainant,Norway,thatthiswouldnotoccur.

78Perhapsthisstatementcanbeexplainedbytheunusualwayinwhichthepointarose.Ecuadorhadargued

that because the EU had twice commenced renegotiation procedures under Article XXVIII of the GATT, a

particular EU quota, the validity of which was at issue in the proceedings, could not have expired. The

AppellateBodyobjected,asexplained,toreachtheconclusionthat‘thefactthattheEuropeanCommunities

initiatedtwiceArticleXXVIIInegotiations tomodify itsconcessions isnotconclusiveas towhether the tariff

quotaconcessiondidnotexpireon31December2002’. Ibid,para452.Itwouldhavebeensufficientforthe

Appellate Body to say that the views of the EUon thematterwere irrelevant; therewas no need to draw

preciselytheoppositeconclusion.

16

under the GATT 1947, which should, in the first instance, be treated as ‘changes’ in a

schedulenotamountingtoamodificationwithinthemeaningofparagraph1of the1980

Decision.Thispracticeisfoundinparagraph5ofthe1980Decision,whichstates:

The procedure of Certification under this Decision may be applied for the

establishmentofconsolidatedSchedulesorofnewSchedulesunderparagraph5(c)

ofArticleXXVI,whereinallchangesaremodificationsorrectificationsreferredtoin

paragraphs1or2.

Some background is necessary. Article XXVI:5(c) of the GATT 1947 permitted newly

autonomous customs territories, which in practice was mainly decolonized independent

states,towhichtheGATT1947hadbeenmadeapplicable,tosucceedtoGATTcontracting

party status,79 upon request and with the sponsorship of the responsible (or formerly

responsible) GATT contracting party.80 Upon succession, the newly autonomous territory

inherited all of the rights and obligations thatwere previously applicable to its territory,

including scheduled commitments (and qualifications)81 which the formerly responsible

contractingpartyhadmadeeffectiveinrespectofitsterritory.82Sometimes,thismeantthat

79AlbertaFabbricotti,‘ArticleXXVI’inRüdigerWolfrum,Peter-TobiasStollandHolgerHestermeyer(eds),WTO

– Trade in Goods,Max Planck Commentaries onWorld Trade Law, Vol 5 (Leiden: Brill, 2011). The right of

succession– tobedeemedacontractingparty–wasautomatic,on request,provided that the requestwas

sponsored by the responsible (or formerly responsible) contracting party. See GATT Council, Minutes of

Meeting25Aprilto1May1963,GATTDocC/M/15,15May1962,at7.Theautomaticityofthisprocedureis

reflected in themore accurate use, at least after 1963, of the terminology of ‘succession’: Tatsuro Kunigi,

‘StateSuccessionintheFrameworkofGATT’(1965)59AmericanJournalofInternationalLaw268,at272and

275.Goingbeyondtheusualrulesinsomerespect,newlyautonomousterritorieswerealsopermittedagrace

periodpriortodecidingwhethertoapplyforsuccession(duringwhich,toalimitedextent,theyweretreated

as de facto GATT contracting parties): GATT Contracting Parties, Application of the Provisions of ArticleXXVI:5(c), Recommendation adopted by the Contracting Parties on 1 November 1957, GATT Doc L/748, 21

November 1957. This reflection period was later extended indefinitely, until the WTO required that all

Memberssubmitschedules.Seepara1(a)oftheWTOMinisterialDecisionontheAcceptanceofandAccession

totheAgreementEstablishingtheWorldTradeOrganization,and,extendingtheperiod,WTOGeneralCouncil,

DecisionontheFinalizationofNegotiationsonSchedulesonGoodsandServices,31January1995,WT/L/30,7

February 1995. Craig VanGrasstek,TheHistory and Future of theWorld TradeOrganization (Geneva:WTO,

2013),at125,notesthat‘[s]everalofthecountriesthatwerestillnegotiatingbythetimetheWTOcameinto

beingmightwellhaveregrettednottakingadvantageofthisoption.’

80Thecriterionofsponsorshipwassolelyevidentiary.ItwastoclarifyforotherGATT1947contractingparties

thattheterritoryatissuewas,infact,autonomousinmatterscoveredbytheGATT1947.

81Asthe1961WorkingPartyontheapplicationofArticleXXXVtoJapansaid‘therecouldbenodoubtthata

government becoming a contracting party under Article XXVI:5(c) does so on the terms and conditions

previously accepted by the metropolitan government on behalf of the territory in question.’ See GATT

ContractingParties,ReportoftheWorkingPartyonArticleXXXVReview,GATTDocL/1545,6September1961,

para19.Seealsobelow,attextton98,foranexampleofastateleavingacustomsunionGATTcontracting

partyandassuming its commitments. This is inaccordancewith the rule stated inArticle20(1)of the1978

Convention,aboveatn62.

82 Contrary to earlier practice, theGATT Panel Report, Jamaica –Margins of Preference, GATTDoc L/3485,

adopted2February1971,para13,para13,determinedthatthedatefordeterminingtheapplicationofGATT

obligations(incasu,preferencemarginsunderArticleI:4oftheGATT1947)wasthedateonwhichtheoriginal

obligationswereundertaken(incasu,1947),notthedateonwhichautonomywasacquired(incasu,1962).

The assumptionof previously applicable commitments contrastswithArticle 20(2) of the 1978Convention,

aboveatn62,according towhichnewly independentstateswerepermitted to formulatenewreservations

upontheirnotificationofsuccessiontoamultilateraltreaty.

17

succeeding contracting parties preferred not to inherit these rights and obligations, and

ratheraccedetotheGATT1947asanewcontractingparty.83Importantly,andrelevantlyto

the present situation, the submission of new GATT 1947 schedules in this context were

treatedasother‘changes’,exceptwhentheschedulerequiredanincreaseindutiesbeyond

theboundrate.84

ItissubmittedthattheUK’sdeparturefromtheEUisthesameasthesituationdescribedby

Article XXVI:5(c) of theGATT 1947, insofar as both concern the acquisition by a customs

territoryoffullautonomyinmatterscoveredbytheGATT1947,orWTO.Itistruethatthe

purposeofArticleXXVI:5(c)wastoestablisharightofsuccessiontocontractingpartystatus,

whereas the UK is already a full WTO Member. However, both the UK and such new

independent states share the same need to adopt, in their own name, the schedule of

concessionsthatformerlyappliedtotheirterritoriesbyvirtueofaGATTcontractingparty

(orWTOMember)withautonomyandresponsibilityinmatterscoveredbytheGATT1947

andWTOrespectively.Itissubmittedthatforthisreason,practiceunderArticleXXVI:5(c)of

the GATT 1947 in relation to the identification of the commitments of the newly

autonomous customs territories should ‘guide’ the WTO, even though technically this

practiceonlyapplies tocases fallingunderArticleXXVI:5(c),which isno longeroperative.

Still, this is another reasonwhy theUK isentitled to submitanewschedule to theGATT

1994asa‘change’notamountingtoamodification,soastoenabletheUKtoavoidhaving

togothroughtheproceduresformodification.

The significance of submitting newUKGATT 1994 andGATS schedule for certification as

‘changes’and rectificationswithin themeaningof the respectiveprocedures is thatother

WTOMembershave limitedgroundsonwhich theymayobject.Paragraph3of the1980

Decisionstatesasfollows:

The draft containing the changes described in paragraphs 1 and 2 shall be

communicated by the Director-General to all the contracting parties and shall

becomeaCertificationprovidedthatnoobjectionhasbeenraisedbyacontracting

partywithinthreemonthsonthegroundthat, in thecaseofchangesdescribed in

paragraph1,thedraftdoesnotcorrectlyreflectthemodificationsor,inthecaseof

changesdescribedinparagraph2,theproposedrectificationisnotwithintheterms

ofthatparagraph.

The2000GATSDecisiondoesnotexpresslyrestrictthegroundsonwhichobjectionsmaybe

made, but it does specify that ‘[a] Member making an objection should to the extent

possible identify the specific elements of the modifications which gave rise to that

objection.’85Byimplication,thesamegroundsshouldberelevanthere,orelsetherewould

83AnexamplewasCambodia,whichpreferrednot tocommit to thehighscheduledcommitments thathad

beenappliedtoitsterritory(aspartoftheIndo-Chinacustomsunion)underFrance’sscheduleofconcessions.

SeeGATTContractingParties,AccessionofCambodia:StatementbyCambodia,GATTDocL/900,1November

1958.ItwassimilarforTunisia,asdiscussedbyKunigi,aboveatn79,at279.

84Forexample,CameroonacceptedthatitwouldhavebeenrequiredtorenegotiateitsscheduleunderArticle

XXIV:6oftheGATT1947ifithadtoincreaseitstariffbindingsduetoitsmembershipofacustomsunion.See

GATT,AccessionbyNewly-IndependentAfricanStatestotheGATT,INT(62)142,3November1962,para18.

85ibid,para2.

18

be no need to distinguish betweenmodifications and other changes.On the other hand,

there is no practice of rejecting an improperly grounded objection, even if the WTO

Director-Generalbyimplicationhasthispower,inordertoadministertheseprocedures.

Thismeansthat,regardlessoftheUK’sproposedschedules,andeveniftheyrepresent,ona

proper analysis, other ‘changes’ and rectifications and not modifications, it is likely that

otherWTOMemberswillobjectinanycase.Giventhis,itisimportanttonotethatthelegal

effectofcertificationisevidentiary.TherightofWTOMemberstomodifyorwithdrawtheir

commitmentsis‘absolute’86andstemsfromtherelevantprovisionsoftheGATT1994and

GATS,87 not from secondary instruments on certification. In the event of an objection to

certification,asamatterofpracticeitwilleitherbethelastcertifiedscheduleisapplicable

or,shouldthisbecontested,theschedulethat,legally,reflectsthecommitmentsmadebya

WTOMemberinaccordancewithproperprocedures.88Inthepresentcase,itmatterslittle

if WTO Members refuse to certify the UK’s new schedule. What counts is that it UK

accuratelyreflectsitsexistingcommitments,astheyarecurrentlyexpressedintheEUGATT

1994andtheEUandUKGATSschedules.Ultimately,ifthereisanydisputeastowhethera

UKmeasureviolatesascheduledcommitment,thematter, includingthedefinitionofthat

commitment,willfalltobeinterpretedinWTOdisputesettlementproceedings.

5. GovernmentProcurementAgreement2014

AfinalquestionconcernstheUK’sstatusundertherevisedWTOGovernmentProcurement

Agreement(GPA2014),aplurilateralWTOagreement.ArticleXXII:1statesthat:

This Agreement shall enter into force on 1 January 1996 for those governments1

whoseagreedcoverageiscontainedintheAnnexesofAppendixIofthisAgreement,

andwhichhave,bysignature,acceptedtheAgreementon15April1994,orhave,by

that date, signed the Agreement subject to ratification and have subsequently

ratifiedtheAgreementbefore1January1996.

1 For thepurposeof thisAgreement, the term ‘government’ is deemed to include

thecompetentauthoritiesoftheEuropeanUnion.

It is the EU alone, and not the UK, that is the relevant party to this agreement.89

Accordingly, it is at present the EU that is solely responsible for its obligationsunder the

agreement,includinginrespectoftheactionsofgovernmentauthoritiesthatareorgansof

itsMemberStates.ItissubmittedthatonleavingtheEU,theUKwillsucceedtotheGPAin

86 Anwarul Hoda, Tariff Negotiations and Renegotiations under the GATT and the WTO (Cambridge: CUP,

2001),at15.

87CfJohnJackson,WorldTradeandtheLawofGATT(Cambridge,MA:TheMITPress,1997),at75.

88See,eg,WTOPanelReport,Russia–TariffTreatment,WT/DS485/R,circulated12August2016,para7.54;

GATT Panel Report, Jamaica – Margins of Preference, above at n 82, para 13; WTO Council for Trade in

Services,ibid,S/L/84,para4(byimplication).

89AgreementonGovernmentProcurement(1996)1915UNTS103,n2.FourEUMemberStates,butnotthe

UK,ratifiedtheGPA1995:ibid.Therevised2014AgreementonGovernmentProcurementwashoweveronly

acceptedbytheEU,notbytheseMemberStates:WTO,StatusofWTOLegalInstruments,aboveatn7,at128-29.

19

itsownright,inaccordancewithrulesofcustomaryinternationallawonthesuccessionof

statestotreaties,andpracticeundertheGATT1947,which‘guides’theWTO.90

Therearetwopreliminarypoints.First,whetherstatessucceedtotreatiesisindependentof

whethertheysucceedtothemembershipof internationalorganizations,wherepractice is

mixed.91Second,whileitistruethatthe1978ConventiononSuccessionofStatesinrespect

of Treaties is, strictly speaking, inapplicable to predecessors which are international

organizations and not states, there is practice concerning the succession of states from

unionsandfederationsformedbythemwithotherstates.Thispracticeisvirtuallyuniform:

inalmostallcasesthestateresumingitsautonomysucceededtotherightsandobligations

in treaties entered into by that federation or union.92 This includes, in particular, trade

agreements.A1971studybytheUNSecretariat,havingreviewedstatepractice,concluded

that ‘in general themembers of a union remain bound by the trade agreements of the

unionfollowingitsdissolution,atleastifthereisaclearcontinuityoftheentityinvolved.’93

This accordswith the basic rule in the 1978 Convention, which is that states succeed to

treaties concluded by the predecessor state that apply to themor,where relevant, their

territory.94

There is also GATT 1947 practice to the same effect. This concerned the Federation of

RhodesiaandNyasaland(alsocalledtheCentralAfricanFederation),whichwasformedby

90ArticleXVI:1oftheWTOAgreement.

91KonradBühler,StateSuccessionandMembershipinInternationalOrganizations(TheHague:Kluwer,2001),

at 309-12, concludes his book with the proposition that international organizations that are functionally

limited,particularlyinrelationtopoliticalissues,recognizethesuccessionofmembership,whileothers,such

astheUnitedNations,donot.PracticeundertheGATT1947,afunctionallyspecificquasi-organisation,isopen

to interpretation.Most cases of direct succession involve the independence of former colonies,whichwas

specifically regulated underArticle XXVI:5(c) of theGATT 1947. Beyond this, there examples of unions that

succeeded to the contracting party status of a constituent entity, such as the Federation of Rhodesia and

Nyasaland,butalsocontrarypractice,suchasthatconcerningtheCzechandSlovakRepublics,whichacceded

asnewGATTcontractingpartiesuponthedissolutionofCzechoslovakia,whichhadbeenaGATTcontracting

party.Ontheotherhand,thesenewcontractingpartieswerepermittedtoretainCzechoslovakia’srightsand

obligations without any need for negotiations, so de facto this can be considered a case of succession,supportingBühler’sargument,thoughhedoesnotrefertothisexample.

92 DP O’Connell, State Succession in Municipal Law and International Law, Vol II: International Relations

(Cambridge: CUP, 1967), at 164-178, discussing the dissolutions of the Union of Colombia (1829-31), the

GermanConfederation(1866),theUnitedArabRepublic(1960),theMaliFederation(1960),theFederationof

RhodesiaandNyasaland(1963),andtheseparationofSingaporefromMalaysia(1965).O’Connelliscriticalof

casesinwhichasucceedingstatedidnotassumetheobligationincurredbythefederationorunion,suchas

Mali(ibid,at172).Hedistinguishesthesecasesfromthoseofsecessioninvolvingdismemberment,suchasthe

dismemberment of the Austro-Hungarian monarchy (1919) and Rwanda-Burundi (1962), but even here a

general principle can be discerned, with anomalies explained on their facts, in favour of the continuity of

treatiesforthenewlyemergedstates(ibid,at178-182).

93UNSecretariat,SuccessionofStatesinrespectofbilateraltreaties:thirdstudypreparedbytheSecretariat

[tradeagreements],UNDocA/CN.4/243/Add.1,24March1971,para182.

94 Article 34 of the 1978 Vienna Convention, above at n 62. There is a possible exception for newly

independent ex-colonies, and perhaps others in a similar situation (eg Ethiopia–Eritrea Claims Commission,

PrisonersofWar–Eritrea’sClaim17,PartialAward(2003)26RIAA23,para35),forwhichsuccessionmaynot

beautomatic,butwhichmayratherbeattheirelection:Articles16and17,ibid(withsomeexceptions).Thisis

acontroversialrule,butforpresentpurposesthisdoesnotmatter,asthisrulemirrors,andis inpartdrawn

from,thepracticeunderArticleXXVI:5(c)oftheGATT1947.

20

SouthernRhodesia,NorthernRhodesiaandNyasalandin1953,andwhichsucceededtothe

contracting party status of Southern Rhodesia.95 The United Kingdom,which at the time

retainedameasureofsovereigntyoverallofthesepartiesundergeneralinternationallaw,

certified that theFederationhad the requisiteautonomy inmatterscoveredby theGATT

1947,96but infact itwouldseemthatthiswasacaseofstraightforwardsuccessionunder

international law, not under Article XXVI:5(c) of the GATT 1947. The relevant decision

contains a preamble stating that ‘by the said Declarations [of the United Kingdom and

SouthernRhodesia],theGovernmentofSouthernRhodesiahasnotifiedtheCONTRACTING

PARTIESthattheFederalGovernmenthassucceededtotherightsandobligationsunderthe

Agreement formerly accepted by Southern Rhodesia’.97 It is only after this that the

contracting parties declared that the Federationwas ‘deemed to be a contracting party’.

TheFederationthereforeapparentlysucceededasacontractingpartyontwobases:first,as

the successor to SouthernRhodesia,which took effect as of theunilateral declarationby

Southern Rhodesia, and second, independently, by declaration of the GATT contracting

parties,mostlikely,althoughthisprovisionwasnotcitedinrelevantrespects,underArticle

XXVI:5(c). For present purposes, of course, it is the first element of this practice that is

relevant.ItshouldsufficethattheUKdeclaresunilaterallythatitsucceedstotheEU’sstatus

asapartytotheGPA2014inrespectofitselfanditsterritory.

This precedent also has a second dimension. The Federation dissolved in 1963, at which

pointSouthernRhodesianotifiedtheGATTcontractingpartiesasfollows:

In resuming its former status as a contracting party to the GATT, the Southern

RhodesianGovernmentaccepts,inrespectoftheterritoryofSouthernRhodesia

(i) therightsandobligationsincurredbytheformerFederalGovernment

under various protocols, declarations and recommendations,

includingthedisinvocationofArticleXXXVinrespectofJapan;

(ii) thatScheduleXVIonceagainbecomesSouthernRhodesia'sSchedule

intheGATTandthattherightsandobligationsoftheformerFederal

Government in relation to the concessions negotiated with other

contractingpartieswillbeapplicabletoSouthernRhodesia;and

(iii) the base date provisions of theDecision of 19November 1960 and

theprovisionsof the furtherDecisionof19November1960 relative

95GATT,CentralAfricanFederation–JointStatementissuedbytheUnitedKingdomandSouthernRhodesian

Delegations for the Information of the Contracting Parties, L/132, 22 September 1953, discussed in GATT

ContractingParties,SummaryRecordoftheThirteenthMeeting,6October1953,SR.8/13,12October1953.

SeealsoGATT,CentralAfricanFederation–JointNotificationbytheGovernmentsoftheUnitedKingdomand

Southern Rhodesia, L/172, 6 November 1953 and GATT Contracting Parties, Federation of Rhodesia and

Nyasaland–Declarationof1November1954,L/278,11November1954.

96GATTContractingParties,FederationofRhodesiaandNyasaland–Declaration,L/278,ibid.

97ibid.

21

totheCustomsTreatmentforProductsofUnitedKingdomDependent

Territories.98

TherewasnoobjectionfromotherGATT1947contractingparties,whichmaybetakenas

acquiescence in this claim. For present purposes, the relevance of Southern Rhodesia’s

assumptionoftherightsandobligationsincurredbytheFederationisthatthisoccurredby

wayof right.Again, this supports theproposition that theUK isentitledat itselection to

succeedtotheGPA2014initsownname.

Finally, it is relevant that other GPA 2014 parties have, at least to some extent,

acknowledgedthattheEUisapartytotheGPA2014inpartonbehalfofitsMemberStates.

InaGPACommitteeDecisionapprovingthemodificationbytheEUofitsAnnexesbyadding

entities of new EUMember States, the GPA Committee ‘[r]ecogniz[ed] that … these ten

countrieswill,asmemberStatesoftheEuropeanCommunities,formpartoftheEuropean

CommunitiesforthepurposesoftheAgreementandbeboundbytheAgreement’.99Strictly

speaking, this cannotmean that these EUMember States are bounddirectly by theGPA

2014.ItprobablyreferstothefactthattheEUMemberStatesareboundunderEUlawby

the GPA 2014. However, what this also means, it may be suggested, is that otherWTO

MembershaveexpresslyrecognizedthattheEU’sstatusaspartytotheGPA2014isatleast

inpartonbehalfofitsMemberStatesinrespectoftheirterritory.Thisshouldbesufficient

to estop those other GPA 2014 parties from rejecting a UK claim to succeed to this

agreementinitsownname.

6. Conclusion

Tosummarise,onthebasisoftheanalysisofferedhere,theUKalreadytodaypossessesfull

WTOrightsandobligationsundertheWTOmultilateraltradeagreements,eveniftheseare,

at present, for themost part, exercised and performed on its behalf by the EU. Inmany

respectsitisnotcomplicatedtoidentifytheserightsandobligations,andthisisparticularly

true of rights and obligations applicable erga omnes partes to all WTO Members (or

categoriesofMembers).ThereisaquestionconcerningtheterritoriallimitationintheUK’s

GATSschedule,accordingtowhichthescheduleonlyappliestoEUterritory,butitisargued,

based on the ‘moving frontiers’ rule, that this limitation can be ignored in theUK’s new

schedule.

ComplicationsarisewheretheUK’srightscorrespondtopartofanobligation,determined

onaquantifiedbasis, that iscurrentlysetout in theEUandEUMemberStateschedules.

98GATT,SubmissionbytheSouthernRhodesianGovernmentfortheInformationofContractingParties,GATT

DocL/2167,4March1964.Thisclaimalsohadapracticalincident,insofarasSouthernRhodesianotifiedthe

GATTcontractingpartiesshortlyafterthisdeclarationthatitwaswithdrawingasafeguardmeasurethathad

been imposed by the Federation. GATT, Southern Rhodesia – Article XIX –Modification of Restrictions on

CertainTextilePiece-Goods,GATTDocL/2213,28April1964.

99WTOCommitteeonGovernmentProcurement,DecisionPursuanttoArticleXXIV:6(a)oftheAgreementon

Government Procurement, 23 April 2004, GPA/78, 4 May 2004 (EU-25), WTO Committee on Government

Procurement, Decision Pursuant to Article XXIV:6(a) of the Agreement on Government Procurement, 8

December 2006, GPA/90, 11 December 2006 (EU-27) and WTO Committee on Government Procurement,

DecisionPursuanttoArticleXXIV:6(a)oftheAgreementonGovernmentProcurement,27June2013,GPA/118,

27June2013(EU-28).

22

ThisisthecasefortheEU’srighttosubsidiseagriculturalproductionuptoasetlimit.Itwas

suggested that the UK should adopt a subsidy commitment calculated by applying the

UK:EU ratio of payments from the EU’s Common Agricultural Policy over the past three

years to these commitments. As to the UK’s quantified obligations corresponding to the

EU’s country-specific tariff ratequotas, it is likely that, inpractice,quotasare likely tobe

establishedwithrelevantWTOMembersbyagreement,inaccordancewithArticleXIII:2of

theGATT1994.However, suchagreements shouldbe reachedagainst thebackgroundof

thefactthattheUKcurrentlypossessesobligationswithrespecttothesetariffratequotas;

it is just difficult to know what these obligations mean in practice. The real problem,

however, isthatregardlessofhowaquotamightbedetermined,theEU-27wouldhavea

right to access this quota under Article XIII:2. This would raise the possibility of a non-

violation complaint, on the basis that at the time the quotas were agreed, they would

exclude imports from other EU Member States. To forestall such a complaint, it was

suggested that the UK could offer tariff rate quotas corresponding to recent imports,

includingfromtheEU-27,overarepresentativemostlikelythree-yearperiod.

As to the procedure to be followed, it was suggested that the UK should submit new

schedulesunderArticleIIoftheGATT1994andArticleXXoftheGATS,asother‘changes’

andrectificationstothecurrentEUschedule,inrespectofitselfanditsterritory.Itisalmost

certain that otherWTOMembers will object to these schedules, but, importantly, these

objectionsdonotrequiretheUKtoenterintorenegotiationoftheUK’sentireschedule,as

is sometimes thought to be the case. Other WTO Members hold no veto over the

determinationoftheUK’sschedulesoroveritslegalpositionwithintheWTOinanyother

respect. At most, objections might lead to arbitration on the value of a compensatory

adjustmentfollowinganallegedmodificationoftheUK’sservicesconcession(whichmight

be zero) and dispute settlement proceedings in respect of any givenmeasure alleged to

violatetheUK’scommitmentsorthatotherwisenullifiesorimpairsbenefitsundertheGATT

1994ortheGATS.However,itisalsosubmittedthattheUKwillbeabletoforestallanysuch

proceedingsbydetermining its tariff ratequotaandsubsidycommitmentsalong the lines

suggestedhere.