WTO rules: Compatibility with human and labour rights

Summary:

Supply chains are increasingly international, but many of EU's trade partners fail to meet both the labour standards of the International Labour Organization (ILO) and international human rights norms. EU trade policy is designed to ensure that economic development complies with World Trade Organization (WTO) rules, while upholding human rights and high labour standards.

WTO rules require members to comply with a set of basic free trading principles, in particular national treatment and most-favoured nation status. When a member wishes to take a trade-affecting measure that departs from WTO rules, they can justify the action on the basis of general exceptions. Whereas there is no specific provision in the WTO rules on human rights, according to case law and precedents, the general exception can sometimes allow trade-restricting measures based on human rights concerns. Yet, the open nature of WTO-rules means that members must devise trade-restrictive measures carefully, and that the dispute settlement process can involve complex legal interpretation if litigation arises. The uncertainty surrounding the compatibility between WTO rules and human and labour rights is attracting growing attention, generating calls for WTO reform.

Another WTO framework that has been the subject of a long-standing debate on whether its flexibility provisions are sufficient to protect human rights and in particular the right to health is the Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS). In the context of the coronavirus pandemic, the debate has refocused on the need to waive some TRIPS provisions. This briefing provides an overview of complex issues relating to human rights and WTO rules. It does not argue for a specific interpretation or position, and does not attempt to bring final clarification on aspects still disputed among legal experts.

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