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Indonesia – Safeguard on Certain Iron or Steel Products

If it looks like a duck, swims like a duck, and quacks like a duck, then it is not a duck

Published online by Cambridge University Press:  07 April 2020

Thomas J. Prusa  and
Edwin A. Vermulst
Thomas J. Prusa*
Affiliation:
Department of Economics, Rutgers University, New Brunswick, NJ
Edwin A. Vermulst*
Affiliation:
VVGB Advocaten, Brussels, Belgium
*
*Email: prusa@econ.rutgers.edu.
**Email: eve@vvgb-law.com
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Abstract

In July 2014, Indonesia implemented a safeguard tariff on galvalume, a type of galvanized flat-rolled steel. Chinese Taipei and Viet Nam challenged the measure, mainly claiming that Indonesia's administering authority failed to satisfy various substantive and procedural requirements of the GATT 1994 and the Safeguards Agreement. The Panel and AB found that the tariff was not a safeguard measure but rather was a simple increase in Indonesia's applied rate. Interestingly, Viet Nam, the largest import supplier, is a member of a free trade area with Indonesia, meaning Viet Nam is not subject to the MFN rate. Viet Nam's preferential tariff treatment likely influenced Indonesia's decision to claim the action was a safeguard. Ironically, even though the Appellate Body essentially rejected its claims, the ruling benefits Viet Nam.

Type
Research Article
Information
World Trade Review , Volume 19 , Issue 2 , April 2020 , pp. 152 - 163
Copyright
Copyright © The Author(s), 2020. Published by Cambridge University Press

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