United States - Trade Measures Affecting Nicaragua
US Nicaraguan Trade (Source: GATT Analytical Index)
|Products at issue||
|Type of product||
Key legal aspects
|Chairperson||Martin Huslid (Norway)|
|Other members||Huberto Villar (Spain), Darry Salim (Indonesia)|
|No of Pages (total / legal reasoning)||19|
|Request for consultations|
|Request for establishment|
|Outcome of the proceedings||
|Additional Info||L/6053 (13/10/1986) United States – Trade Measures Affecting Nicaragua – Report by the Panel: The Panel noted that, while both parties to the dispute agreed that the United States, by imposing the embargo, had acted contrary to certain trade-facilitating provisions of the General Agreement, they disagreed on the question of whether the non-observance of these provisions was justified by Article XXI(b)(iii). The Panel considered that, as it was not authorized to examine the justification for the United States' invocation of a general exception to the obligations under the General Agreement, it could find the United States neither to be complying with its obligations under the General Agreement nor to be failing to carry out its obligations under that Agreement. The Panel further concluded that, even if it were found that the embargo nullified or impaired benefits accruing to Nicaragua independent of whether or not it was justified under Article XXI, the contracting parties could, in the circumstances of the present case, take no decision under Article XXIII:2 that would re-establish the balance of advantages which had accrued to Nicaragua under the General Agreement prior to the embargo. In the light of the foregoing considerations the Panel decided not to propose a ruling in this case on the basic question of whether actions under Article XXI could nullify or impair GATT benefits of the adversely affected contracting party. The Panel concluded that embargoes such as the one imposed by the United States, independent of whether or not they were justified under Article XXI, ran counter to basic aims of the GATT, namely to foster non-discriminatory and open trade policies, to further the development of the less-developed contracting parties and to reduce uncertainty in trade relations. The Panel recognized that the General Agreement protected each contracting party's essential security interests through Article XXI and that the General Agreement's purpose was therefore not to make contracting parties forego their essential security interests for the sake of these aims. However, the Panel considered that the GATT could not achieve its basic aims unless each contracting party, whenever it made use of its rights under Article XXI, carefully weighed its security needs against the need to maintain stable trade relations.
C/W/506 (03/11/1986) Communication from Nicaragua (23/10/1986) "What also troubles Nicaragua is that the Panel did not make any concrete recommendation and, in particular, that it did not recommend the withdrawal of the embargo or the need to compensate Nicaragua for the damage caused by it." "The Panel recommends that the Contracting Parties resolve these questions in the framework of the Decision concerning Article XXI, adopted on 30 November 1982." "This recommendation would be acceptable to Nicaragua provided that it is placed and interpreted within the framework of paragraph 21 of the Understanding."
L/6661 (23/03/1990) Communication from Nicaragua "As was publicly announced on 13 March , President Bush lifted the embargo and other economic measures which the United States has applied to Nicaragua since May 1985."
C/M/240 (04/05/1990) Minutes of Council Meeting (03/04/1990) Nicaragua and US made comments on L/6661 (Communication from Nicaragua of 23/03/1990). Nicaragua: "as this item was now being considered for the last time in the Council (...) some remarks (...)"
C/181 (05/06/1992) Status of Work in Panels and Implementation of Panel Reports - Report by the Director-General (19/06/1992) Reported on the developments of the dispute.