Peace Clause
Encyclopedia
Trade negotiators generally refer to Article 13 of the World Trade Organization
's Agreement on Agriculture
as the Peace Clause. Article 13 holds that domestic support measures and export subsidies of a WTO Member that are legal under the provisions of the Agreement on Agriculture cannot be challenged by other WTO Members on grounds of being illegal under the provisions of another WTO agreement.
The Peace Clause has expired on January 1, 2004. It is now possible, therefore, for developing countries and nations favoring free trade
in agricultural goods, such as the Cairns Group
, to use the WTO dispute settlement mechanism in order to challenge, in particular, U.S.
and EU export subsidies on agricultural products.
World Trade Organization
The World Trade Organization is an organization that intends to supervise and liberalize international trade. The organization officially commenced on January 1, 1995 under the Marrakech Agreement, replacing the General Agreement on Tariffs and Trade , which commenced in 1948...
's Agreement on Agriculture
Agreement on Agriculture
The Agreement on Agriculture is an international treaty of the World Trade Organization. It was negotiated during the Uruguay Round of the General Agreement on Tariffs and Trade, and entered into force with the establishment of the WTO on January 1, 1995....
as the Peace Clause. Article 13 holds that domestic support measures and export subsidies of a WTO Member that are legal under the provisions of the Agreement on Agriculture cannot be challenged by other WTO Members on grounds of being illegal under the provisions of another WTO agreement.
The Peace Clause has expired on January 1, 2004. It is now possible, therefore, for developing countries and nations favoring free trade
Free trade
Under a free trade policy, prices emerge from supply and demand, and are the sole determinant of resource allocation. 'Free' trade differs from other forms of trade policy where the allocation of goods and services among trading countries are determined by price strategies that may differ from...
in agricultural goods, such as the Cairns Group
Cairns Group
The Cairns Group is an interest group of 19 agricultural exporting countries, composed of Argentina, Australia, Bolivia, Brazil, Canada, Chile, Colombia, Costa Rica, Guatemala, Indonesia, Malaysia, New Zealand, Pakistan, Paraguay, Peru, the Philippines, South Africa, Thailand, and Uruguay.-History...
, to use the WTO dispute settlement mechanism in order to challenge, in particular, U.S.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
and EU export subsidies on agricultural products.