Likeness Under Gatt
“Like-product” is a very controversial, yet simultaneously important topic in international law. The term is used in several provisions of the General Agreement on Tariffs and Trade (GATT) in an effort to prevent differences in treatment of “like” goods. When two products are “like,” then the GATT provisions come into play in governing the treatment that World Trade Organization (WTO) member countries owe to one another. Specifically, the treatment consists of domestic economic and non-economic policies. Although there seems to be no definitive definition of the term “like” or “like-product,” there are identifiable and describable differences in the policy contexts that will vary the meaning of “like” from one provision to another. Nevertheless, the provisions do not work in opposition to one another; they work in conjunction, reinforcing each other, elaborating and supplementing on the previous provision. Appellate Body Report in European Communities.
It is difficult to compare or contrast two things with one another, without first understanding what qualities or characteristics are being compared and contrasted. As such, it is important to understand the criteria by which likeness is to be measured. Specifically, in the context of world trade, it makes sense to turn to the GATT. In the GATT one of the most important articles in which “like-product” is used is Article III, specifically Article III paragraph 1, paragraph 2, and paragraph 4.
It is important to first turn to the general policy in Article III paragraph1, as it informs, and guides in understanding and interpreting the other provisions. Appellate Body Report in European Communities. Article III paragraph 1, states that WTO member governments should not apply internal taxes or regulations that give protection to domestic production. This provision makes no mention of “like-product,” nor does not it try to define what or how many physical characteristics need to be identical in order for two products to be considered “like.” Rather, the general policy requires that WTO member governments not institute rules that will tend to favor domestic products over foreign products that compete for sales. For example, America should not impose such a high tax on the importation of German-made cars, as such would inevitably favor the production and purchase of American-made cars. Subsequently, it seems that according to Article III paragraph 1, “competitiveness” is the major focus, and whether something is competitive is determined by whether the domestic product is substitutable by the foreign product. This means whether consumers are willing to choose the foreign product as a substitute for the domestic product.
This understanding of the general policy would seem to be quite broad, as anything can be deemed competitive, especially if it does not need to