WTO Working Papers

WTO working papers usually represent research in progress. Such research may be conducted in the preparation of WTO Secretariat reports, studies or other material for WTO members. The papers are circulated for comment because the WTO considers critical review of professional research to be extremely important.


Regulatory Autonomy and Multilateral Disciplines

The Dilemma and a Possible Resolution

A major challenge for the multilateral trading system is to secure the benefits of trade liberalization without infringing on the freedom of governments to pursue legitimate domestic objectives. The difficulty lies in distinguishing between two types of situations. In one, a non-protectionist government cannot prevent certain domestic policies from incidentally discriminating against foreign competitors. In the other, a protectionist government uses a legitimate objective as an excuse to design domestic policies which inhibit foreign competition. The challenge is to devise rules which are sensitive to the difference between these two situations, exonerating the former while preventing the latter. The approach suggested in this paper is to create a presumption in favour of the economically efficient policy measure, with departures inviting justification.


Keywords: protection, international trade, regulation, national treatment
JEL: F13: International Economics / Trade / Trade Policy; International Trade Organizations; K20: Law and Economics / Regulation and Business Law / Regulation and Business Law: General; K33: Law and Economics / Other Substantive Areas of Law / International Law
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