Ou Est Votre Chapeau?: Economic Sanctions and Trade Regulation*
Malloy, Michael P., Chicago Journal of International Law
This article seeks to determine whether US economic sanctions can be maintained consistently with the obligations of the international trade regime. In Part I, it will consider the extent to which the current prevalence of economic sanctions may create tension with international trading rules. In Part II, the article will assess arguments that sanctions are inconsistent with applicable principles of customary international law. Part III will consider whether sanctions are inconsistent with international trading regimes and consequently are impermissible. In Part IV, the article concludes that while sanctions are legally permissible in the face of indeterminate legal obligations and international trading rules, imposition of sanctions may nevertheless have adverse consequences for a sanctioning state.
Economic sanctions have become an increasingly prevalent feature of US international economic and foreign policy.1 The general impermissibility of the use or threat of armed force has to some degree increased the relative importance of economic sanctions, a form of economic warfare. This is not necessarily a fortuitous development. The less obvious costs of economic sanctions,2 as compared to those of armed force, may encourage a facile resort to economic sanctions that would have been intolerable in the case of armed force. We may see something of this result in the increased frequency of use of economic sanctions in US practice over the past twenty years.3
Understanding the place of economic sanctions within the institutions of international trade can be a complicated undertaking for several reasons. First, while "economic sanctions" may have intuitive meaning as a descriptive term, there is continuing scholarly debate over the technical scope of the term.4 Second, "emergency" sanctions, when continued over a long period of years (such as is the case with sanctions against Cuba), may be assimilated into "normal" trade and foreign policy. Third, sanctions often blur into ordinary trade penalties in ways that make it difficult to distinguish between the two. For example, ordinary penalties available for violations of settled trade policy may reach such critical proportions that they metamorphose into aggressive sanctions in a burgeoning "trade war."5 Similar problems exist when we consider the denial of favorable or preferential trade treatment-itself a feature of trade policy-on the basis of criteria other than those appurtenant to that policy. Thus, economic sanctions may be viewed as occurring within a spectrum in which related governmental actions may blend into "sanctions" at their outer edges.
In some situations, we may be able to differentiate sanctions from ordinary trade policy in terms of their respective policy objectives. However, consideration of these contrasting policies may actually underscore the tension inherent in the relationship between economic sanctions and US trade policy. Typically, economic sanctions are effective to the extent that they frustrate the normal expectations of the trade and financial systems. Thus, in a narrow sense, economic sanctions are not a part of US trade policy and are antithetical to the basic rubrics of that policy.6 The imposition of economic sanctions does not, in the short term, reinforce stability in external trade. As a prima facie matter, then, the use of economic sanctions creates tension within international trade regimes.
II. POSSIBLE INCONSISTENCIES WITH GENERAL PRINCIPLES OF PUBLIC INTERNATIONAL LAW
A. PROBLEM OF INDETERMINACY
Customary and even conventional principles of public international law have not had any readily discernible, practical effect on US practice with respect to economic sanctions. In part this may be due to the apparent indeterminacy of international law in this regard. Typical of the indeterminate nature of the principles invoked is the recent attempt by Marc Bossuyt to construct a set of limitations on the use of sanctions under international law. …