Agreement on Safeguards

The Agreement on Safeguards

• reaffirms the general rule that safeguard measures may not be used in a discriminatory manner
• prohibits the use of "grey area measures" which escape multilateral control - such as voluntary export restraints and orderly marketing arrangements
• establishes a maximum period for the imposition of safeguard measures

In a departure from the general rule of non-discriminatory treatment - and the provisions of Article XIX of GATT - Article 5:2(b) permits the discriminatory allocation of quotas subject to certain conditions.

Additional disciplines on the use of safeguard measures are imposed by the Agreement.

• Safeguard measure may not be imposed without an investigation by the competent authorities of the importing Member, including public hearings and public-notice to interested parties. The Agreement provides a detailed specification of the factors to be evaluated in determining the existence or threat of serious injury. It requires that a report be published setting out the findings of the investigation and the reasoned conclusions reached on all pertinent issues of fact and law.
• The duration of safeguard measures is limited under the Agreement. Safeguard measures of more than one year duration are to be progressively liberalized, and those imposed for more than three years must be reviewed (not later than the mid-term of the measure) for further possible liberalization. The reimposition of safeguard measures is not allowed before a specified period has elapsed
• Import quotas used as safeguard measures must not normally reduce imports below the average of imports in the last three representative years for which statistics are available
• More detailed notification and consultation requirements are specified
• Existing grey area measures must be phased-out and new grey area measures are prohibited

In order to encourage Members to rely on safeguard measures under this Agreement and to encourage a shorter duration of safeguards, the right to retaliate against a safeguard measure taken under certain conditions is not to be exercised during the first three years that the measure is in effect.

Recognition of Interests

Developing Country Members: Article 9:1



Two conditions under which imports originating in a developing country Member will be exempt from safeguard measures are specified

1. The share of imports of the product from the developing country Member in the total imports of that product in the importing Member does not exceed 3 per cent ; and,

2. Developing country Members with less than a 3 per cent share of imports collectively do not account for more than 9 per cent of the total imports of the product concerned in the importing Member.

Fewer Obligations

Developing Country Members: Article 9:2



The general obligation that safeguard measures cannot be in place for more than 8 years does not apply to developing country Members. They are permitted to maintain their safeguard measures for two years longer than the maximum allowed for others.

Developed country Members may not re-impose safeguard measures with an initial duration of more than 180 days until at least two years after they expire or - if their initial duration was more than two years - until after a period equal to the initial duration. Developing country Members, however, may re-impose safeguard measures after half the period of their duration has elapsed provided the delay before re-imposition is at least two years. For example, a developed country Member's safeguard measure initially imposed for a three (four or five) year period may be re-imposed only after a lapse of three (four or five) years. The safeguard measure of a developing country Member, however, initially in place for the same duration can be re-imposed after two (two or two-and-half) years.