MAKING A CASE FOR THE IMPOSITION OF UNILATERAL TRADE SANCTIONS TO PROTECT LABOUR AND BASIC HUMAN RIGHTS

Abstract

While liberalization and free trade play an important role in trade law, related concerns for labour and human rights cannot be ignored. These concerns have given rise to the modern concept of the “social clause”, a provision in trade agreements allowing sanctions to curb labour exploitation. The WTO, however, via the Singapore Ministerial Declaration, has taken the stance that concerns for labour rights fall outside the domain of its regulation and are not to be used for protectionist purposes. In this manner, strict sanction has been given under the WTO regime to principles of international trade law such as Most Favored Nation status and National Treatment. Barring a few exceptional circumstances, these principles bar nations from imposing unilateral trade sanctions that target a particular nation. This note makes a case for unilateral trade sanctions imposed with an aim to protect labour and basic human rights. While agreements such as the North American Agreement on Labor Cooperation under the NAFTA have failed to act as an enforceable social clause, a strong case for practicable incorporation of labour and human standards can be made under Article XX of GATT. Article XX of GATT, if interpreted as a social clause allowing for countermeasures in defence of erga omnes obligations, acts as a “backdoor” for the entry of human and labour standards in the WTO trade regime. An appraisal of measures allowed under Article XX suggests that if unilateral trade sanctions are absolutely necessary to curb violations of labour rights, such sanctions can be justified under the WTO regime.