T 01 - R

TEAM CODE-01
AMITY UNIVERSITY INTERNATIONAL MOOT

COURT COMPETEITION, 2017
IN THE DISPUTE SETTELMENT BODYOF WTO
THE CASE CONCERNING THE GATT TRADE PRINCIPLES
STATE OF LOCASIA (APPELANT)
V.
STATE OF GRANDIANA.......................................... (RESPONDENT)
MEMORIAL OF RESPONDENT
2
TABLE OF CONTENTS
TABLE OF CONTENTS .............................................................................................................................. 2

LIST OF ABBREVIATIONS ....................................................................................................................... 3
INDEX OF AUTHORITIES......................................................................................................................... 4
STATEMENT OF JURISDICTION ............................................................................................................. 7
STATEMENT OF FACTS ........................................................................................................................... 8
ISSUES RAISED ........................................................................................................................................ 12
SUMMARY OF ARGUMENTS ................................................................................................................ 13
ARGUMENT ADVANCE ......................................................................................................................... 14
ISSUE-1:- WAS THE REVOCATION OF TREATY LEGAL .............................................................. 14
Abuse of rights and abuse of discretion- a hindrance to policy of good faith:- .................................. 15
Against the law of revocation of treaty as mentioned under Vienna convention on law of treaties:-......... 17
ISSUE:-2 WAS THE REVOCATION OF MFN STATUS A LEGAL ACT OR A POLITICAL MOVE 27
Unreasonable basis of removing MFN ....................................................................................................... 32
Waiver is on baseless ground:- ................................................................................................................... 33
Gave alleged dumping A reason for putting contravelling duty: ............................................................. 36
Compensation and damages must pe paid:- .................................................................................. 39
PRAYER ....................................................................................................................................... 41
3
LIST OF ABBREVIATIONS
Art. :- ARTICLE
WTO :- WORLD TRADE ORGANISATION
GATT :- GENERAL AGREEMENTON TRADE AND TARIFF
MFN : -- MOST FAVOURED NATION
VCLT :- VIENNA CONVENTION ON LAW OF TREATIES
DSU :- DISPUTE SETTELMENT UNDERSTANDING
DSB :- DISPUTE SETTELMENT BODY
& :- AND
4
INDEX OF AUTHORITIES
Journals and research:-
Igor Ivanovich Lukashuk, The Principle PactaSuntServanda and the Nature of

Obligation under International Law
(83)AJI.12
Tariq Hassan, Good Faith in Treaty Formation (1980) 21 Va J Intl L 448; Gerald
Fitzmaurice, The Law and Procedure of the International Court of Justice (1953)
30 British Ybk Intl L 1, 53..14
Cf Trail Smelter Arbitration (United States of America v Canada) (1938/ 1941) III
RIAA 1904, 1965; Cheng (n 5)
130.................14
Alexandre Kiss, Abuse of Rights in MPEPIL (December 2006, online edn)

para.14
Interpretation of treaties, Vienna convention on law of

treaties,1969..14
Y.B.I.L.C 1966 International Law Commissions Commentary, II,

P.219..14
Agreement between WHO& EGYPT case ICJ reports 1980

pg7515
untreaty.un.org, Law of treaties, International Law Commission, last update: 30

June 2005. Consulted on 7 December
200815
. TERMINATION OF OR WITHDRAWAL FROM A TREATY UNDER ITS

PROVISIONS OR BY CONSENT OF THE PARTIES
Watson 1992: 1117
5
The Ford Foundation, the UCLA Academic

Senate21
Burley, supra note 2; Abbott, IR Prospectus, supra

ns..21
M. Poonja, Termination of Treaties Owing to Fundamental Change of Circumstances

(Clausula Rebus Sic Stantibus): A Doctoral Dissertation [Juris Doctor dissertation,
5
Charles University, Prague, 1977] (Rawalpindi: Abbas Arts, 1982),
p.2822
Mahmood M. Poonja, Termination of Treaties Owing to Fundamental Change of

Circumstances (Clausula Rebus Sic Stantibus): A Doctoral Dissertation [Juris Doctor
dissertation, Charles University, Prague, 1977] (Rawalpindi: Abbas Arts, 1982), pp.
23
2823
James Nickel, with assistance from Thomas Pogge, M.B.E. Smith, and Leif Wenar,
December 13, 2013, Stanford Encyclopedia of Philosophy, Human Rights, Retrieved
August 14, 2014 ..26
James Nickel, with assistance from Thomas Pogge, M.B.E. Smith, and Leif Wenar,
December 13, 2013, Stanford Encyclopedia of Philosophy, Human Rights, Retrieved
August 14, 201426
Burns H. Weston, March 20, 2014, Encyclopedia Britannica, human rights,
Retrieved August 14, 2014
Gary J. Bass (book reviewer), Samuel Moyn (author of book being reviewed),
October 20, 2010, The New Republic, The Old New Thing, Retrieved August 14,
2014..27
Merriam-Webster dictionary, [2], Retrieved August 14, 2014, "rights (as freedom
from unlawful imprisonment, torture, and execution) regarded as belonging
fundamentally to all
persons.27
Panel Report, European Communities Measures Prohibiting the Importation and

Marketing of Seal
Products..37
Conventions, acts and cases:-
Vienna convention on law of treaties

General agreement on trade and terrif
6
Nuclear Tests Case (n 2) para 46 (emphasis

added)...13
North Atlantic coast fisheries arbitration
YBLLC,1966ii,p211.13
Dispute settlement body mechanism of wto
7
STATEMENT OF JURISDICTION
The two states namely the State of Locasia (Appealant) & State of Grandiana (Respondent) have
submitted there arguments in the Dispute settlement body of the World Trade Organisation. Both
the parties are full members of the UN and are also full members of WTO and hence are very
much bound by the decision of the dispute settlement body. Both the states are requesting to the
dispute settlement body to setup the penal under article vi of DSU in order to sort out the case on
the basis of penal report.
8
STATEMENT OF FACTS
BACKGROUND:-
The moot problem deals with the dispute between two state namely State of
Grandiana & State of Locasia.
Both the countries are the members of WTO- GATT framework. Moreover they both
adhere to the laws and policies of WTO and are bound by the general laws and obligation
of the dispute settlement mechanism of WTO.
STATE OF GRANDIANA:-
Grandiana is developed country located in the continent of Alasia, which is the largest
continent of the world with a population of around 10 million people. It is second most
developed countries in the world.
It has achieved a global economic might in a short span of around 100 years since
independence.
It is a state full of industrial prosperity which is the main reason for the development of
the country; however is deficit in the natural resources because of the existing semi arid
geographical condition.
Grandiana is the major exporters of finished goods to many of the lesser developed
countries.
It is one of the founding members of WTO-GATT framework which is generally
committed to the ideas of free economic trade. The country has a general reputation of
helping the lesser developed countries in growth and development.
But the critics state that the main aim of the state is to maintain hegemony in the
countries across the world.
9
STATE OF LOCASIA:-
Locasia is the least developed country situated in the continent of Eurosia which is
famous for its environmental heritage, ecological richness and biodiversity.
Locasia got independence around 20 years back and presently has around 1 billion
population.
The country is sound in ecological richness and has a huge deposit of basic raw material
and resources.
The country is stricken with abject poverty and long famines. Moreover there are a lot of
issues of inhuman treatment of laborers and abuses of the human rights across the
country; moreover due to this the country is not able to gain industrial soundness.
The country became the member of GATT- WTO framework five years ago. Five years
ago it opposed the idea of WTO because number of free trade obligation being onerous
on LDC.
But slowly and gradually it embraced the framework. Locasia and Grandiana has good
relation with one another.
TURN OF EVENTS:-
In march 2016, Dr. Jabio PM of Grandiana went on to official visit to locasia for
economical cooperation between the two countries.
They together signed an agreement, to develop a sea trading port in coastal region of
Nacaria situated in the western coast of Locasia.
On one hand this trading port will give an easy access to grandiana in the continent of
Eurosia, on the other hand it also generate revenue for the development of country. It was
agreed that the profit ratio must be 70:30. For the grandiana and Locasia respectively.
PM of grandiana has agreed to invest USD 100 million. For the establishment of the same
and provide the technical support too.
Dr. Jabio said Both of the countries have faced similar problems in the past. Our
common heritage and are common ideals require that we must unite together for the
greater future. This trading port will be a symbol of our friendship and it will help us to
10
collaborate in the economic development of our countries. This trading port marks a
new start to our old friendship
In October 2016 grandiana transferred USD 20 million to locasia for the establishment of
the said port. Consequently the work started on full scale along with technical support of
grandiana.
GENISIS OF DISPUTE
In February 2017 the government of Locasia changed and now the CP party is in power
replacing the LJP party. They being the opposite party do not agree with the easternwhile
policy of LJP party and is called LJP as a capitalist stooge of grandiana.
The president Mr. Gnai (president) said:- The old government of Mr. Han, LJP Party
has plundered the wealth and the natural resources of our country. We cannot allow
this any further. We cancel the proposal of the trading port in alliance with Grandiana.
This project does not serve our national interests.
The agreement done by LJP party with state of Locasia was irrevocably revoked on 10
march 2017 because of the act that the region is rich in biodiversity and an endangered
species of zebra namely the Gravys zebra which is only found in this region across the
globe.
Hence it was feared that the industrialization of region would erode the environmental
worth of the region. The spokesperson of the party cited the Rio declaration 1992 in
support of the government viewpoint.
Moreover the Environment impact assessment report dated 1st January 2017 also
proposed the view that the trading port will completely erode the environmental richness
and will also make harm to the endangered species of zebra.
The state of Grandiana opposed the revocation of the treaty contract. As a reaction to
these development the official spokesperson of state of Grandiana said:- The revocation
of the treaty contract by the new government of Locasia is plainly against the rules of
the international laws and the same is a lame attempt to wriggle out of its existing
obligations at the international level. We will pursue to matter at the appropriate level.
This illegal act of the State of Locasia will not be allowed to go unnoticed.
11
In may 2017 grandiana banned the import of consumer goods from the countries where
goods were made in violation of Human rights and labor rights moreover by illegal
animal hunting too.
This lead to reduction in export from Locasia to grandiana by 60% which in turn lead to a
loss of (app) USD 40 million per anum.
The spokesperson of Locasia reacted to this that these bans are nothing but a faade just
to take revenge of the cancellation of the said port building contract.
Also around the same time the state of Grandiana gave monetary subsidy to its local
exporters of consumer goods provided that they meet the international slandered of
manufacturing and distribution.
These measures was strongly objected by local manufacturers of state of Locasia. Hence
the state of Locasia put a contravelling duty on the import of goods from grandiana in
order to safeguard the interest of local manufacturers and to avoid the alleged dumping.
The spokesperson of Grandiana defended the trade measures by saying that these
measures are not directed towards any specific country but is done only to protect the
human rights and to promote better trade.
CURRENT STATUS
Due to the above state of circumstances, the state of Locasia has now revoked the MFN
status of state of grandiana. It has approached the WTO dispute settlement mechanism for
the resolution of existing trade dispute between the two countries.
On the other hand state of grandiana challenges the said illegal revocation of MFN status
and it also seeks monetary compensation and exemplary damages for the illegal acts of
the state of locasia.
12
ISSUES RAISED
ISSUE-1:- WAS THE REVOCATION OF TREATY BY STATE OF LOCASIA

LEGAL
A) Unreasonable and against the objectives of good faith
B) Abuse of rights and abuse of discretion- a hindrance to policy of good faith:-
C) Against the law of revocation of treaty as mentioned under Vienna convention

on law of treaties
ISSUE:-2 WAS THE REVOCATION OF MFN STATUS A LEGAL ACT OR A

POLITICAL MOVE
A) Ban on Imports:- on reasonable basis
B) Unreasonable basis of removing MFN
C) Gave alleged dumping A reason for putting contravelling duty
13
SUMMARY OF ARGUMENTS
ISSUE-1:- WAS THE REVOCATION OF TREATY BY STATE OF LOCASIA

LEGAL
No, your lordship it is humbly submitted that the treaty revoked by the State of Locasia with
the state of Guadiana was completely illegal and outside the preview of legal parlance. This
can be said with the help of following points which illustrate that the act was correct because
the VCLT provides certain articles such as article 42,43,45,52,60,65 etc which gives a
glimpse that how to revoke a treaty under the same. Here state of Locasia has not followed
the same and hence is void.

POLITICAL MOVE
Yes your lordship the revocation of MFN status by the state of Locasia from the state of
Grandiana is a an illegal step and was just a political move. This can be proved under the
following points:-
1) Revocation was on the baseless grounds.

2) Violation of the rules priscribed under the GATT laws and especially to the MFN
principle.
All these steps have just a positive faade. But in reality these are against the rules as
mentioned under the legal heads.
14
ARGUMENT ADVANCE
ISSUE-1:- WAS THE REVOCATION OF TREATY LEGAL
Your lordship it is humbly submitted that the revocation of treaty by state of locasia was
legally non justifiable. This can be proved in the under mentioned heddings:-
1) Unreasonable and against the objectives of good faith:-
Meaning:-
Good faith is an abstract and comprehensive term that encompasses a sincere belief or motive
without any malice or thedesire to defraud others. It derives from the translation of the Latin ter
m bona fide, and courts use the two terms interchangeably.1
Article 26-Every treaty in force is binding upon the parties to it and must be performed by them
in good faith.2
In the legal parlance the word good faith is used as Pactasuntsarvanda. The rationale behind
the maxim is seemingly self-evident: a need by the international community for a system that can
ensure international orderand prevent arbitrary behaviour and chaos. 3In the Nuclear Tests Case,
the ICJ held that:"One of the basic principles governing the creation and performance of legal
obligations... is good faith. Trust and confidence are inherent in international cooperation, in
particular in an age when this cooperation in many fields is becoming increasingly essential.
Just as the very rule of pactasuntservanda in the law of treaties is based on good faith, so also is
the binding character of an international obligation. Thus interested States may take cognizance
1
Legal dictionary pg 246
2
Vienna convention on law of treaties,1969
3
Igor IvanovichLukashuk, The Principle PactaSuntServanda and the Nature of Obligation under International Law
(83) AJIL 1989 513.
15
of unilateral declarations and place confidence in them, and are entitled to require that the
obligation thus created be respected."4
This good faith is used by the jurists in different ways in the different cases and
advisory opinion. For example- The court while analyzing article 95 and 96 of Algeciras
said The power of making valuation rests with custom authorities, but it is a power
which must be exercised in good faith
Similarly the permanent court of International justice dealing with fishing rights of united
states by treaty of Ghent said .. from the treaty results an obligatory relation
whereby the right of Great Britain to exercise its right of sovereignty by making
regulation is limited to such regulations as are made in good faith and are not in violation
of the treaty5
hence here we can say that this word good faith is used in different perspectives by the jurists in
different cases.
Abuse of rights and abuse of discretion- a hindrance to policy of good faith:-

Possibly the most contentious aspect of good faith in international law is the prohibition on the
abuse of rights. The aspect of abuse of right and the arbitrary exercise of a right are closely
related and not clearly distinguishable. An abuse of right is said to occur when a State exercises
its rights in such a way as to encroach on the rights of another State, and that the exercise ... is
unreasonable, and pursued in an arbitrary manner, without due consideration of the legitimate
expectations of the other State.6 .The basis that prohibits this behaviour is good faith, is If a
State is able to exercise discretion, the arbitrary and unreasonable exercise of this discretion is
said to amount to an abuse of rights.7which a State can be held internationally responsible for.8
4
Nuclear Tests Case (n 2) para 46 (emphasis added).
5
North Atlantic coast fisheries arbitration YBLLC,1966ii,p211
6
CfLauterpacht (n 43) 345.
7
Tariq Hassan, Good Faith in Treaty Formation (1980) 21 Va J Intl L 448; Gerald Fitzmaurice, The Law and
Procedure of the International Court of Justice (1953) 30 British Ybk Intl L 1, 53
8
Cf Trail Smelter Arbitration (United States of America v Canada) (1938/ 1941) III RIAA 1904, 1965; Cheng (n 5) 130.
16
Abuse of rights may take place in three distinct sets of circumstances:
(A) State exercises its right in such a way as to hinder another State enjoying its own
rights;
(b) a State exercises a right for an end which it was not intended for (improper purposes);
(c) arbitrary exercise of a right causing injury to another party.9
Article 31,
1. A treaty shall be interpreted in good faith in accordance with the ordinary meaning to be
given to the terms of the treaty in their context and in the light of its object and purpose.10
Under article 31(1) many principles were evolved and one of them is the principle of
effectiveness.On this point the commission took the view that the maxim ut res magisvaleat
quam pereat Reflects a true general rule of interpretation. IT embodies that when a treaty is
opened to two interpretations one of which does and the other does not enable the treaty to have
appropriate effects, good faith and the objects and purposes of the treaty demands that former
interpretations should be adopted 11
In light of the above stated maxim the treaty between Grandiana and Locasia has the following
positive genesis12:-
The proposal of Grandiana of establishing a sea port in the Nacaria Region of Locasia
is prima facie a positive step to develop a financially and economically deprived
country like locasia by way of industrialization.
By way of trade between the two countries the human rights and labout rights which
were in tragic situation in the state of Locasia would elevate.
9
Alexandre Kiss, Abuse of Rights in MPEPIL (December 2006, online edn) para 4 f,
10
Interpretation of treaties, Vienna convention on law of treaties,1969
11
Y.B.I.L.C 1966 International Law Commissions Commentary, II, P.219
12
Facts of the case.
17
The trade treaty between the two countries ipso facto states that the grandiana in an
indirect manner sown the seeds of social economic and political upliftment of the
country.
Moreover even some of the provision of Vienna convention on law of treaties specifically
talks about the good faith. Here the very important thing which has to be pondered upon
is article 56(2) which focus on the very essence of good faith prospects.
This article says that . A party shall give not less than twelve months' notice of its intention to
de nounce or withdraw from a treaty under paragraph1.13
Here state of locasia has abruptly withdraw the treaty which is against the very principle of good
faith.
Against the law of revocation of treaty as mentioned under Vienna convention on law of
treaties:-
Introduction:-
The Vienna Convention on the Law of Treaties (VCLT) is a treaty concerning

the international law on treaties between states. It was adopted on 23 May 1969.14and opened for
signature on 23 May 1969. The Convention entered into force on 27 January 1980. The VCLT
has been ratified by 114 states as of April 2014. Some countries that have not ratified the
Convention, such as the United States, recognize parts of it as a restatement of customary
law and binding upon them as such. The Convention codifies several bedrocks of contemporary
international law. It defines a treaty as "an international agreement concluded between states in
written form and governed by international law," as well as affirming that "every state possesses
the capacity to conclude treaties. Article 1 restricts the application of the Convention to written
treaties between States, excluding treaties concluded between the states and international
organizations or international organizations themselves.
13
Agreement between WHO& EGYPT case ICJ reports 1980 pg 75
14
untreaty.un.org, Law of treaties, International Law Commission, last update: 30 June 2005. Consulted on 7
December 2008.
18
The Convention has been referred to as the "treaty on treaties; it is widely recognized as the
authoritative guide regarding the formation and effects of treaties. Even those countries whohave
not ratified it recognize its significance. For example, the United States recognizes that parts of
the Convention constitute customary law binding on all nations.In India, the Supreme court has
also recognised the customary status of the convention.
The illegal act regarding the treaty can be proved with the help of the bellow mentioned heads:-
ARTICLE 2915
TERRITORIAL SCOPE OF TREATIES
Unless a different intention appears from the treaty or is otherwise established, a treaty is
binding upon each party in respect of its entire territory.
As we can derive from this Article that the mere reason for revocation of a treaty by a particular
party should be that a completely different intention of the other party appears to them. But as
we can say this from the facts that there was no change of intention by the state of Grandiana.
The treaty clauses, rules and regulations were completely the same as they were when the treaty
was signed by both the countries, Grandiana even provided some amount of loan to Locasia and
the working of setting up the trading port began.
So no change in Grandianas perspective and intention regarding the treaty can be seen.
Therefore this cant be a valid ground of revocation of treaty by Locasia.
ARTICLE 4216
1. The validity of a treaty or of the consent of a State to be bound by a treaty may be

impeached only through the application of the present Convention.
2. The termination of a treaty, its denunciation or the withdrawal of a party, may take place
only as a result of the application of the provisions of the treaty or of the present Convention.
The same rule applies to suspension of the operation of a treaty.
15
Article 29 of Vienna Convention Of Law of Treaties
16
Article 42 of Vienna convention on law of treaties VALIDITY AND CONTINUANCE IN FORCE OF TREATIES
19
ARTICLE 5417
The termination of a treaty or the withdrawal of a party may take place:
(a) In conformity with the provisions of the treaty; or
(b) At any time by consent of all the parties after consultation with the other
contracting States
Reading section 42 and 54 of Vienna convention on law of treaties, it can be summed up that for
the impeachment of the treaty there are two important credentials. These are as follows:-
A) In conformity with the provisions of the treaty and,

B) By consent of all the parties.
Consent:-
It is important to make two preliminary observations; first, that consent is required in some
aspects to establish binding obligations on states and it remains a desirable principle under
international law. It is true that disregarding the importance of state consent is equivalent to a
physicist disregarding the law of gravity because he prefers the results that can thus be
obtained18.
Secondly, there are numerous sources of law establishing binding obligations on states even
without their consent. The justification for establishing binding obligations upon states without
state consent most significantly arises out of the weaknesses of the requirement of consent to
create binding obligations on states.
Consent is not a new concept in international law. Contemporary international law has developed
on the principle of consent. observes 19 that international law is built on state consent. State
consent is the method whereby states identify and acknowledge the rules they consider binding
upon themselves (Watson, 1992: 111). It is pertinent to appreciate state consent in the
development of international law. Despite the fact that the requirement of consent in
17
. TERMINATION OF OR WITHDRAWAL FROM A TREATY UNDER ITS PROVISIONS OR BY CONSENT OF THE PARTIES
18
Watson 1992: 110
19
Guzman (2011: 2)
20
international law has its flaws, consent plays an important role in international law which makes
it desirable.
As a general rule, a state cannot be bound by a rule it has not consented to. The requirement of
consent is rooted in the principle of state sovereignty. This was clearly underscored in the where
the PCIJ20 noted that the rules binding upon states emanate from their own free will as expressed
in conventions or by usages generally accepted as expressing principles of law. The court further
stated that restrictions upon the independence upon states cannot be presumed. This means that
states have the right to determine which rules will govern their relations with each other. Any
rule that is made in absence of a states consent violates state sovereignty.
Treaties are some of the primary sources of international law and obligations. Article 38(1)(a) of
the Statute of the International Court of Justice authorizes the ICJ to apply, inter alia,
international conventions establishing rules recognized expressly by states. Treaties therefore
create binding obligations on contracting states.
However for a treaty to bind a state, the state must have consented to be bound by the treaty. The
Vienna Convention on the Law of Treaties (hereinafter referred to as the VCLT), defines a treaty
in article 2(1)(a) as an international agreement concluded between states in written form and
governed by international law. From this definition it would be implausible to argue that consent
is not required in concluding a treaty. The word agreement in the definition of a treaty by the
VCLT depicts the fact that a treaty can only be concluded if the states have consented to be
bound by it. Additionally the preamble to the VCLT recognizes among others the principle of
consent.
Even in contemporary treaties no treaty binds a state that has not consented to it. International
law declares that duly made treaties create obligations for the states parties (Shearer, 1994: 399).
In light of this observation, no treaty, old or new, whatever its character or subject, is binding on
a state unless it has consented to it21. This is because a treaty must be consented to.
20
SS Lotus case (1927)
21
Henkin, 1995: 28
21
So it can be said that these two are the essential one. In our present case the state of Grandiana
and state of Locasia were admitted in the legal bindingness of the treaty where the two things are
very important. But here state of Locasia has irrevocably revoked the treaty. This sounds that
again a clearity is needed. This is because here the word irrevocable is used which means non
revocable treaty. The very treaty was irrevocable and hence cant be revoked. Here it can be said
that let us assume that the revocation can be made but only and only with the consent of both the
parties which was not at all taken and hence was act contrary to the law.
Coming to the further point of discussion we have to analyze the other articles which are related.
Under the VCLT the other provisions applicable which talks or reflects the grounds of
revocation of treaty are as follows:-
Termination or suspension of the operation of a treaty as a consequence of its breach
1. A material breach of a bilateral treaty by one of the parties entitles the other to invoke the
breach as a ground for terminating the treaty or suspending its operation in whole or in part.
2. A material breach of a multilateral treaty by one of the parties entitles:
(a) the other parties by unanimous agreement to suspend the operation of the treaty in whole or
in part or to terminate it either:
(i) in the relations between themselves and the defaulting State, or (ii) as between all the parties;
(b) a party specially affected by the breach to invoke it as a ground for suspending the operation
of the treaty in whole or in part in the relations between itself and the defaulting State;
(c) any party other than the defaulting State to invoke the breach as a ground for suspending the
operation of the treaty in whole or in part with respect to itself if the treaty is of such a character
that a material breach of its provisions by one party radically changes the position of every party
with respect to the further performance of its obligations under the treaty.
3. A material breach of a treaty, for the purposes of this article, consists in:
22
(a) a repudiation of the treaty not sanctioned by the present Convention; or
(b) the violation of a provision essential to the accomplishment of the object or purpose of the
treaty.
4. The foregoing paragraphs are without prejudice to any provision in the treaty applicable in the
event of a breach.
5. Paragraphs 1 to 3 do not apply to provisions relating to the protection of the human person
contained in treaties of a humanitarian character, in particular to provisions prohibiting any form
of reprisals against persons protected by such treaties.22
This Article examines the international legal rules governing responses to breach of an
international treaty from the perspective of various rationalist theories of international relations
("IR") developed by political scientists. The relevant international legal rules consist of two
broad categories. One such category, which this Article calls the "rules of release," governs
responses to breach of a treaty that involve a decision by the victim to cease performing its own
obligations under the breached treaty. The other such category, which this Article calls the "rules
of remediation," governs all other responses to breach of a treaty, such as the victim's decision to
pursue political, economic, or military sanctions against the breaching party, or to sue the
breaching party for damages. Article 60 of the Vienna Convention on the Law of Treaties
codifies the rules of release; the currently uncodified "law of state responsibility" is the source of
the rules of remediation relevant to treaty breaches.23
This Part analyzes the "rules of release" described in Article 60 of the Vienna Convention. These
rules revolve around the concept of "material breach," which is defined as "the violation of a
provision essential to the accomplishment of the object or purpose of the treaty. 24 With respect
to bilateral treaties, a material breach is both necessary and sufficient to give the victim of that
breach the option to release itself from all of its obligations under the breached treaty. With
respect to multilateral treaties, a material breach is a necessary but not a sufficient condition to
22
Article 60 vienna convention on law of treaties
23
The Ford Foundation, the UCLA Academic Senate
24
Burley, supra note 2; Abbott, IR Prospectus, supra note 3
23
give rise to the release option; the material breach must also either lead all non-breaching parties
to agree that their simultaneous release is appropriate, or specially affect a party seeking release
only from its obligations to the breaching state, or radically affect the future performance
obligations of all parties.
Meaning of Material breach:-
A material breach is a partys failure to perform a major part of the contract. The breach is
substantial and prevents the contract from being completed or defeats the purpose of the contract.
A non-breaching party is thus no longer obligated to finish their performance under the contract.
Treaties may be terminated or suspended through a provision in the treaty (if one exists) or by
the consent of the parties. In the case of a material breachi.e., an impermissible repudiation of
the treaty or a violation of a provision essential to the treatys object or purposethe innocent
party of a bilateral treaty may invoke that breach as a ground for terminating the treaty or
suspending its operation.
Here in our present case there is no any sort of material breach by the state of Grandiana
regarding the rules and provisions of the treaty and moreover the state has also given support to
the state of Locaisa for or in order to complete the purpose of the treaty done hence there was no
any material breach pertinent and an important aspect of revocation of treaty.
Another article which talks about the revocation of treaty is article 62. It says:-
Fundamental change of circumstances25
1. A fundamental change of circumstances which has occurred with regard to those existing at
the time of the conclusion of a treaty, and which was not foreseen by the parties, may not be
invoked as a ground for terminating or withdrawing from the treaty unless:
(a) the existence of those circumstances constituted an essential basis of the consent of the
parties to be bound by the treaty; and
25
ARTICLE 62 VCLT
24
(b) the effect of the change is radically to transform the extent of obligations still to be
performed under the treaty.
2. A fundamental change of circumstances may not be invoked as a ground for terminating or

withdrawing from a treaty:
(a) if the treaty establishes a boundary; or (b) if the fundamental change is the result of a breach
by the party invoking it either of an obligation under the treaty or of any other international
obligation owed to any other party to the treaty.
3. If, under the foregoing paragraphs, a party may invoke a fundamental change of circumstances
as a ground for terminating or withdrawing from a treaty it may also invoke the change as a
ground for suspending the operation of the treaty.
In public international law, clausula rebus sic stantibus (Latin for "things thus standing") is
the legal doctrine allowing for treaties to become inapplicable because of a fundamental change
of circumstances. It is essentially an "escape clause" that makes an exception to the general rule
of pacta sunt servanda (promises must be kept).26
Because the doctrine poses a risk to the security of treaties as its scope is relatively unconfined, it
requires great care as to the conditions in which it may be invoked27
Here in our present case there is no change in circumstances related to the grounds and the very
base of the treaty. Hence this base is also null and void and cant be applied for the revocation of
the treaty.
Moreover the VCLT also provide the procedure to followed in relation to the suspension of
treaty along with the termination as well.These are as follows:-
26
Mahmood M. Poonja, Termination of Treaties Owing to Fundamental Change of Circumstances
(Clausula Rebus Sic Stantibus): A Doctoral Dissertation [Juris Doctor dissertation, Charles
University, Prague, 1977] (Rawalpindi: Abbas Arts, 1982), p. 28.
27
Mahmood M. Poonja, Termination of Treaties Owing to Fundamental Change of Circumstances
(Clausula Rebus Sic Stantibus): A Doctoral Dissertation [Juris Doctor dissertation, Charles
University, Prague, 1977] (Rawalpindi: Abbas Arts, 1982), pp. 2328
25
Procedure to be followed with respect to invalidity, termination,

withdrawal from or suspension of the operation of a treaty28
1. A party which, under the provisions of the present Convention, invokes either a defect in its
consent to be bound by a treaty or a ground for impeaching the validity of a treaty, terminating it,
withdrawing from it or suspending its operation, must notify the other parties of its claim. The
notification shall indicate the measure proposed to be taken with respect to the treaty and the
reasons therefor.
2. If, after the expiry of a period which, except in cases of special urgency, shall not be less than
three months after the receipt of the notification, no party has raised any objection, the party
making the notification may carry out in the manner provided in article 67 the measure which it
has proposed.
3. If, however, objection has been raised by any other party, the parties shall seek a solution
through the means indicated in article 33 of the Charter of the United Nations.
4. Nothing in the foregoing paragraphs shall affect the rights or obligations of the parties under
any provisions in force binding the parties with regard to the settlement of disputes.
5. Without prejudice to article 45, the fact that a State has not previously made the notification
prescribed in paragraph 1 shall not prevent it from making such notification in answer to another
party claiming performance of the treaty or alleging its violation.
Instruments for declaring invalid, terminating, withdrawing from or suspending the

operation of a treaty29
1. The notification provided for under article 65 paragraph 1 must be made in writing.
28
Article 65 VCLT
29
Article 67 VCLT
26
2. Any act declaring invalid, terminating, withdrawing from or suspending the operation of a
treaty pursuant to the provisions of the treaty or of paragraphs 2 or 3 of article 65 shall be carried
out through an instrument communicated to the other parties. If the instrument is not signed by
the Head of State, Head of Government or Minister for Foreign Affairs, the representative of the
State communicating it may be called upon to produce full powers.
VCLT talks about the specific procedure which must be followed while terminating or
withdrawal of the treaty. When we analyse the above mentioned articles it can be said the
specified procedure is to be abruptly followed regarding the different contexts such as the time
period, the bindingness and other obligatios. But it can be said that the state of Locasia has
neither given the time period nor has subsited the application proceedings which were worth
mendatory. Hence it can be said that the revocation of the treaty is completely against the due
process of the rules and regulations containe din the very premises of VCLT.
So, your lordship it is submitted in the honable court of justice that on these grounds it can be
said that the act of Locasia in relation of treaty is violation of law and is completely an unjust
step.
27

POLITICAL MOVE
Your lordship the revocation of MFN status was completely an illegal act and was just a political
move. This can be proved under the following heads.
But, before moving further we have to understand the very concept of MFN and its legal status:-
Most-favoured-nation (MFN): Under the WTO agreements, countries cannot normally

discriminate between their trading partners. Grant someone a special favour (such as a lower
customs duty rate for one of their products) and you have to do the same for all other WTO
members.
This principle is known as most-favoured-nation (MFN) treatment . It is so important that it is

the first article of the General Agreement on Tariffs and Trade (GATT), which governs trade in
goods. MFN is also a priority in the General Agreement on Trade in Services (GATS) 30 and
the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) 31 although in
each agreement the principle is handled slightly differently. Together, those three agreements
cover all three main areas of trade handled by the WTO.
Some exceptions are allowed. For example, countries can set up a free trade agreement that
applies only to goods traded within the group discriminating against goods from outside. Or
they can give developing countries special access to their markets. Or a country can raise barriers
against products that are considered to be traded unfairly from specific countries. And in
services, countries are allowed, in limited circumstances, to discriminate. But the agreements
only permit these exceptions under strict conditions. In general, MFN means that every time a
country lowers a trade barrier or opens up a market, it has to do so for the same goods or services
from all its trading partners whether rich or poor, weak or strong.32
30
(Article 2)
31
(Article 4),
32
PRINCIPLES OF TRADING SYSTEM WTO
28
Here it is clear that the MFN is a very important aspect of GATT laws and that to WTO
principles which regulate the trading procedures which is been followed all across the world or
in the world market. The state of Locasia on one end has revoked the treaty illegally and on the
other hand has also revoked the very MFN status. The grounds which they have used for the
revocation and the negligence of the other factors has made this revocation in the stage of
question. This revocation is completely illegal and is just a political move. We know that many
decisions are taken not on the legal parlence but on the aspect of politics. This is because all
these facts are used by the political groups in order to fulfill there political needs.
First of all we have to discuss that why the revocation of the status was completely illegal. This
can be proved uunder the following points:-
Ban on Imports:- on reasonable basis
The state of Locasia has said that the ban on imports by the state Locasia was unreasonable. But
this factor is not true. This is because the facts of the case clearly shows that the inports between
state of Locasia and the state of Grandiana was on the very reasonable. The facts shows that
The human rights abuses against its citizens and its laborers have also been a big issue in
this country
Human rights and labour rights are very important factor to analyze. These are also an important
which has to be pondered upon in consistence with the very development.
Meaning:-
33
Human rights are moral principles or norms that describe certain standards of human
behaviour, and are regularly protected as legal rights in municipal and international law.34 They
are commonly understood as inalienable35 fundamental rights "to which a person is inherently
entitled simply because she or he is a human being," and which are "inherent in all human
beings"[5] regardless of their nation, location, language, religion, ethnic origin or any other
33
James Nickel, with assistance from Thomas Pogge, M.B.E. Smith, and Leif Wenar, December 13, 2013,
Stanford Encyclopedia of Philosophy, Human Rights, Retrieved August 14, 2014
34
James Nickel, with assistance from Thomas Pogge, M.B.E. Smith, and Leif Wenar, December 13, 2013,
Stanford Encyclopedia of Philosophy, Human Rights, Retrieved August 14, 2014
35
The United Nations, Office of the High Commissioner of Human Rights, What are human rights?, Retrieved
August 14, 2014
29
status. They are applicable everywhere and at every time in the sense of being universal,36 and
they are egalitarian in the sense of being the same for everyone. They are regarded as requiring
empathy and the rule of law37 and imposing an obligation on persons to respect the human rights
of others, and it is generally considered that they should not be taken away except as a result
of due process based on specific circumstances; for example, human rights may include freedom
from unlawful imprisonment, torture and execution.38
The doctrine of human rights has been highly influential within international law, global and
regional institutions.Actions by states and non-governmental organisations form a basis of public
policy worldwide. The idea of human rights suggests that "if the public discourse of peacetime
global society can be said to have a common moral language, it is that of human rights." The
strong claims made by the doctrine of human rights continue to provoke
considerable scepticism and debates about the content, nature and justifications of human rights
to this day. The precise meaning of the term right is controversial and is the subject of continued
philosophical debate;while there is consensus that human rights encompasses a wide variety of
rights[5] such as the right to a fair trial, protection against enslavement, prohibition
of genocide, free speech or a right to education, there is disagreement about which of these
particular rights should be included within the general framework of human rights;[1] some
thinkers suggest that human rights should be a minimum requirement to avoid the worst-case
abuses, while others see it as a higher standard.
Hence it can be said that in the general terms and terminologies the human rights are very
important aspect of the individual life. Moreover the human rights protection must be there in
every case where ever or which ever step is been taken.
At the international level also the specific provision is made related to the protection of human
rights.
36
Burns H. Weston, March 20, 2014, Encyclopdia Britannica, human rights, Retrieved August 14, 2014
37
Gary J. Bass (book reviewer), Samuel Moyn (author of book being reviewed), October 20, 2010, The New
Republic, The Old New Thing, Retrieved August 14, 2014
38
Merriam-Webster dictionary, [2], Retrieved August 14, 2014, "rights (as freedom from unlawful imprisonment,
torture, and execution) regarded as belonging fundamentally to all persons"
30
There are certain primacy of human right has been given. Among all the principles some of the
which has to be pondered upon is:-
1.States shall implement their international legal obligations in good faith and respect, protect
and fulfil human rights in the governance of their borders.
2. States shall ensure that human rights are at the centre of the governance of migration at
international borders.
3. States shall respect, promote and fulfill human rights wherever they exercise jurisdiction or
effective control, including where they exercise authority or control extraterritorially. The
privatisation of border governance functions does not defer, avoid or diminish the human rights
obligations of the State39
Further the other provisions which talks about the very contention on human rights. Maany a
commission has been made like ICCPR and ICESR. The only question which abruptly arises that
is there can be any situation when on the verge of the human rights violation the very free trade
can be done. This is an expressed question asked at the different levels. In the debate on trade
and development, a common point of contention between economists, activists, politicians, and
corporate boards is whether to include or exclude human rights, environmental, and labor
considerations from the World Trade Organization General Agreement on Trade and Tariff trade
regime ("WTO-GATT") 40 Doctrinal and institutional constraints inherent in international law
make enforcement of human rights untenable for all but the most egregious of violations.
39
Sixty-ninth session Item 69 of the provisional agenda o borders trade.
40
Compare Ernst-Ulrich Petersmann, Time for a United Nations 'Global Compact' for Integrating Human Rights into
the Law of Worldwide Organizations: Lessons from European Integration, 13 EUR. J. OF INT'L L. 597 (2002),
available at http://www.ejil.org/journalNol I3/No3/art .html (last visited June 25, 2005), and Gabrielle Marceau,
WTO Dispute Settlement and Human Rights, 13 EUR. J. OF INT'L L. 753 (2002), available at
http://www.ejil.org/journal/VolI3/No4/artl.html (last visited June 25, 2005), with Philip Alston, Resisting the
Merger and Acquisition of Human Rights by Trade Law: A Reply to Petersmann, 13 EUR. J. OF INT'L L. 815 (2002),
available at http://www.ejil.org/journa1/Voll3/No4/art2.html (last visited June 25, 2005), and CLAUDE BARFIELD,
FREE TRADE, SOVEREIGNTY, DEMOCRACY: THE FUTURE OF THE WORLD TRADE ORGANIZATION (2001). This debate
can also be framed in terms of WTO constitutionalism. See Robert Howse & Kalypso Nicolaidis, Enhancing WTO
Legitimacy: Constitutionalization or Global Subsidiarity?, in DELIBERATELY DEMOCRATIZING MULTILATERAL
ORGANIZATION (Marco Verweij & Tim Josling eds., 2003)
31
This prompts arguments for increased linkages between trade and human right41. But there is a
clear cut answer to this question of human rights. Development is the right of the society and
each and every country has all the rights of its development but the protection of human rights
cant be ignored.
Further in the facts there is a clear significance of violation of labour rights too. The Labor
rights or workers' rights are a group of legal rights and claimed human rights having to do
with labor relations between workers and their employers, usually obtained under labor and
employment law. In general, these rights' debates have to do with negotiating workers' pay,
benefits, and safe working conditions. One of the most central of these rights is the right to
unionize. Unions take advantage of collective bargaining and industrial action to increase their
members' wages and otherwise change their working situation. Labor rights can also take in the
form of worker's control and worker's self management in which workers have a democratic
voice in decision and policy making. The labor movement initially focused on this "right to
unionize", but attention has shifted elsewhere.
These labour laws are the very important one which also to be consider if the developed country
like state of Grandiana will do the trade on the verge of human rights and the labour rights then
what example will go across the world. Always all the country which are famous developed and
at the prestigious position, they always set an example all across the world. Hence the act done
by the state of Grandiana in protection of human rights and labour rights is correct and sets a
very good example in front of the whole world. So this cant be cited as a ground for revocation
of MFN status.
41
Doctrinal constraints include the jus ad bellum (i.e. those laws regulating when the use of force is legal)
limitations on the legitimacy of humanitarian intervention. Presently, international law recognizes Security Council
authorization and self-defense as the only grounds for the legitimate use of force. See U.N. Charter art. 42, 51.
Furthermore, the doctrine of state sovereignty often shields against even the legitimate use of force, not to
mention other milder forms of human rights enforcement. See generally Thomas M. Franck, Recourse to Force
(2002). Institutionally, the Security Council, which is competent to handle grave human rights abuses that pose a
threat to international peace and security, is often hamstrung by political logjam. INDEP. TASK FORCE SPONSORED
BY THE COUNCIL ON FOREIGN RELATIONS AND FREEDOM HOUSE, ENHANCING U.S. LEADERSHIP AT THE UNITED
NATIONS (2002). Enforcement of less egregious human rights violations, such as squashing labor unions, is left to
UN agencies and treaty bodies, such as the International Labor Organization or the Commission Against Torture,
whose means are limited to diplomatic persuasion and reprimand, not the use of physical coercion. See Frederic L.
Kirgis, Jr., Enforcing International Law, American Society of International Law, January 1996, at
http://www.asil.org/insights/insightl.htm (last visited July 28, 2005)
32
Unreasonable basis of removing MFN
Before discussing the exceptional circumstances about the GATT laws. Firstly we have to talk
about the very procedure of waiver under the WTO laws. The rules are as follows:-
A decision to grant a waiver in respect of any obligation subject to a transition period or a period
for staged implementation that the requesting Member has not performed by the end of the
relevant period shall be taken only by consensus.
(a) A request for a waiver concerning this Agreement shall be submitted to the Ministerial
Conference for consideration pursuant to the practice of decision making by consensus. The
Ministerial Conference shall establish a time-period, which shall not exceed 90 days, to consider
the request. If consensus is not reached during the time-period, any decision to grant a waiver
shall be taken by three fourth of the Members.
(b) A request for a waiver concerning the Multilateral Trade Agreements in Annexes 1A or 1B
or 1C and their annexes shall be submitted initially to the Council for Trade in Goods, the
Council for Trade in Services or the Council for TRIPS, respectively, for consideration during a
time-period which shall not exceed 90 days. At the end of the time-period, the relevant Council
shall submit a report to the Ministerial Conference
. A decision by the Ministerial Conference granting a waiver shall state the exceptional
circumstances justifying the decision, the terms and conditions governing the application
of the waiver, and the date on which the waiver shall terminate. Any waiver granted for a
period of more than one year shall be reviewed by the Ministerial Conference not later
than one year after it is granted, and thereafter annually until the waiver terminates. In
each review, the Ministerial Conference shall examine whether the exceptional
circumstances justifying the waiver still exist and whether the terms and conditions
attached to the waiver have been met. The Ministerial Conference, on the basis of the
annual review, may extend, modify or terminate the waiver.
33
In our present case the State of Locasia has wrongfully revoked the mfn status, granted to State
of locasia because they have not performed the due procedure as mentioned above in the said
article ix of WTO agreement. The very article of WTO agreement say two important thing:-
a) The time period of waiver is specified ie 90 days of the application

b) Moreover is not the unilateral decision of the country itself, but is a decision iof the
committee about which it is mentioned in the article.
Here the facts clearly show the mentality of state of Grandiana which is in the faade opposite to
there contravelling mentality. Here the main ideology of the state is to prove there act at any
cost. But the rules totally negate the same. Hence it can be said that the act was wrong and was
against the rules specified.
This can be proved on another ground ie:-
Waiver is on baseless ground:-
The article of WTO says that the waiver can be granted on the exceptional circumstances. Your
lordship the economical and trade condition between the two countries does not come under the
exceptional circumstances. This can be said by reading article xx-
The GATT law talks about the very fact of trade and development. Under this law there is a
specific article ie article xx and article xxi which comes under the perview of exceptional
clauses. This is the footing on which the different articles has some or the other exceptions.
Article xx says:-
Subject to the requirement that such measures are not applied in a manner which would
constitute a means of arbitrary or unjustifiable discrimination between countries where the same
conditions prevail, or a disguised restriction on international trade, nothing in this Agreement
shall be construed to prevent the adoption or enforcement by any contracting party of measures:
(a) necessary to protect public morals;
(b) necessary to protect human, animal or plant life or health;
34
(c) relating to the importations or exportations of gold or silver;
(d) necessary to secure compliance with laws or regulations which are not inconsistent with the
provisions of this Agreement, including those relating to customs enforcement, the enforcement
of monopolies operated under paragraph 4 of Article II and Article XVII, the protection of
patents, trade marks and copyrights, and the prevention of deceptive practices;
(e) relating to the products of prison labour;
(f) imposed for the protection of national treasures of artistic, historic or archaeological value;
(g) relating to the conservation of exhaustible natural resources if such measures are made
effective in conjunction with restrictions on domestic production or consumption;
(h) undertaken in pursuance of obligations under any intergovernmental commodity agreement

which conforms to criteria submitted to the CONTRACTING PARTIES and not disapproved by
them or which is itself so submitted and not so disapproved;*
(i) involving restrictions on exports of domestic materials necessary to ensure essential

quantities of such materials to a domestic processing industry during periods when the domestic
price of such materials is held below the world price as part of a governmental stabilization plan;
Provided that such restrictions shall not operate to increase the exports of or the protection
afforded to such domestic industry, and shall not depart from the provisions of this Agreement
relating to non-discrimination;
(j) essential to the acquisition or distribution of products in general or local short supply;
Provided that any such measures shall be consistent with the principle that all contracting parties
are entitled to an equitable share of the international supply of such products, and that any such
measures, which are inconsistent with the other provisions of the Agreement shall be
discontinued as soon as the conditions giving rise to them have ceased to exist.
The CONTRACTING PARTIES shall review the need for this sub-paragraph not later than 30
June 1960. Moreover a separate article xxi talks abou the other provision of exception.
35
Article XXI Security Exceptions
Nothing in this Agreement shall be construed
(a) to require any contracting party to furnish any information the disclosure of which it
considers contrary to its essential security interests; or
(b) to prevent any contracting party from taking any action which it considers necessary for the
protection of its essential security interests
(i) relating to fissionable materials or the materials from which they are derived;
(ii) relating to the traffic in arms, ammunition and implements of war and to such traffic in other
goods and materials as is carried on directly or indirectly for the purpose of supplying a military
establishment; (iii) taken in time of war or other emergency in international relations; or
(c) to prevent any contracting party from taking any action in pursuance of its obligations under
the United Nations Charter for the maintenance of international peace and security42
This article talk about the security exception. Security is an important aspect of a countries
foreign policy. Here this aspect is just an economical phenomenon and not an important phase of
Security exception. Hence it can be said from the very fact that not being an exceptional
circumstance, it can not be the ground of revocation of MFN status.
42
ARTICLE XXI GATT DISPUTE(SECURITY EXCEPTION)
36
Gave alleged dumping A reason for putting contravelling duty:
The facts of the case state that the The State of Locasia put a countervailing duty on the import
of goods from the State of Grandiana in order to protect its local manufacturers of the consumer
goods and to prevent the alleged dumping of the goods by the State of Grandiana.
Meaning of dumping
Dumping, in reference to international trade, is the export by a country or company of a product

at a price that is lower in the foreign market than the price charged in the domestic market. As
dumping usually involves substantial export volumes of the product, it often has the effect of
endangering the financial viability of manufacturers or producers of the product in the importing
nation.
Meaning of Anti dumping
An anti-dumping duty is a protectionist tariff that a domestic government imposes on foreign

imports that it believes are priced below fair market value. Dumping is a process where a
company exports a product at a price lower than the price it normally charges on its own home
market. To protect local businesses and markets, many countries impose stiff duties on products
they believe are being dumped in their national market.43
Meaning of the word contravelling duty
Countervailing duties (CVDs), also known as anti-subsidy duties, are trade import duties
imposed under World Trade Organization(WTO) rules to neutralize the negative effects
of subsidies. They are imposed after an investigation finds that a foreign country subsidizes its
exports, injuring domestic producers in the importing country. According to World Trade
Organization rules, a country can launch its own investigation and decide to charge extra duties,
provided such additional duties are in accordance with the GATT Article VI and the GATT
Agreement on Subsidies and Countervailing Measures.
43
INVESTOPIDIA PG. 23
37
Anti-dumping and Countervailing Duties
1. The contracting parties recognize that dumping, by which products of one country are
introduced into the commerce of another country at less than the normal value of the products, is
to be condemned if it causes or threatens material injury to an established industry in the territory
of a contracting party or materially retards the establishment of a domestic industry. For the
purposes of this Article, a product is to be considered as being introduced into the commerce of
an importing country at less than its normal value, if the price of the product exported from one
country to another
(a) is less than the comparable price, in the ordinary course of trade, for the like product when
destined for consumption in the exporting country, or,
(b) in the absence of such domestic price, is less than either
(i) the highest comparable price for the like product for export to any third country in the
ordinary course of trade, or
(ii) the cost of production of the product in the country of origin plus a reasonable addition for
selling cost and profit. Due allowance shall be made in each case for differences in conditions
and terms of sale, for differences in taxation, and for other differences affecting price
comparability.*
2. In order to offset or prevent dumping, a contracting party may levy on any dumped product an
antidumping duty not greater in amount than the margin of dumping in respect of such product.
For the purposes of this Article, the margin of dumping is the price difference determined in
44
accordance with the provisions of paragraph 1.*
44
Article vi anti dumping and contravelling duty
38
Under the above given article we must focus the sixth point ie
No contracting party shall levy any anti-dumping or countervailing duty on the importation of
any product of the territory of another contracting party unless it determines that the effect of the
dumping or subsidization, as the case may be, is such as to cause or threaten material injury to an
established domestic industry, or is such as to retard materially the establishment of a domestic
45
industry.
This sub clause shows that the very contravelling duty should be imposed in a case where there
is a metirial injury to the other country or to the domestic industry. Article 3 of the AD
Agreement contains rules regarding the determination of material injury caused by dumped
imports. Material injury is defined as material injury itself, threat of material injury, or material
retardation of the establishment of a domestic industry. The basic requirement for determinations
of injury, is that there be an objective examination, based on positive evidence of
the volume and price effects of dumped imports and the consequent impact of dumped imports
on the domestic industry. Article 3 contains specific rules regarding factors to be considered in
making determinations of material injury, while specifying that no one or several of the factors
which must be considered is determinative 46 . Article 3.5 requires, in establishing the causal
link between dumped imports and material injury, known factors other than dumped imports
which may be causing injury must be examined, and that injury caused by these factors must not
be attributed to dumped imports.47
Here the very explanation show that there must be some sort of link between the dumping and
material injury. Here the facts does not show in expressed or in an implied way that the state of
locasia was acting with such an intention.
The main objective of the state was just to give away the benefits to there local exporters of
manufacture goods on the ground that they follow the human rights objectives. These human
rights objectives is an important aspect of the world trade too. No law supports the view of an
45
ARTICLE VI ( SUB CLAUSE 6A)
46
ARTICLE III WTO LAWS
47
ARTICLE 3.5 WTO LAWS
39
activity on the verge of human rights. It is a pinnacle that the human right objectives and needs
must be fulfilled. David Kinley has noted that the addressing of human rights issues expressly is
limited to a few highly disputed cases.Even in these few cases, human rights-related concerns
arose only indirectly and legal argumentation has not been based expressly on the core human
rights treaties. The most direct contact occurred in the recent European Communities
Measures Prohibiting the Importation and Marketing of Seal Products (EC Seal Products)
dispute, where a WTO Panel adverted to two instruments within the broad scope of international
human rights law as factual evidence.48
The very factual evidence is an important source of determination. Here we have to again look
towards the factual context. The facts in the beigning shows that according to the reports the
state of locasia is very much pro towards the violation of human rights and labour rights. This
impliedly shows the fact that in the state of Locasia no any sort of human care taking is done and
all the activities is performed on the verge of the same. Hence the act of state of Grandiana was
completely correct in order to make the people know about the sound step of state of Grandiana
towards the protection of human rights. Hence the contravellig duties imposed is totally against
the very laws of international law and is also against the very concept of free trade.
Compensation and damages must pe paid:-
Under the legal parlence the compensatory jurisprudence is very famous. Under this there is a
very provision of Compensation. Actually law always work in order to safeguard the rights of the
people. The situation when any sort loss occured or damage is caused to the people the law does
the reimbursement of the same with a philosophy that no innocent person can go empty handed
and justice prevails.
48
Panel Report, European Communities Measures Prohibiting the Importation and Marketing of Seal Products,
WTO Docs WT/DS400/R and WT/DS401/R (25 November 2013) (EC Seal Products). In this dispute, the
European Union presented an argument which drew on the United Nations Declaration on the Rights of
Indigenous Peoples (a declaration of the UN General Assembly rather than a treaty) and on International Labour
Organization Convention No 169 concerning Indigenous and Tribal Peoples. See United Nations Declaration on the
Rights of Indigenous Peoples, GA Res 61/295, UN GAOR, 61st sess, 107th plen mtg, Agenda Item 68, Supp No 49,
UN Doc A/RES/61/295 (2 October 2007, adopted 13 September 2007); Convention (No 160) concerning Indigenous
and Tribal Peoples in Independent Countries, opened for signature 27 June 1989, 1650 UNTS 383 (entered into
force 5 September 1991). These instruments recognise and exhort respect for the inherent rights of indigenous
peoples, rather than dealing with universal human rights.
40
In our present case the state of Grandiana has invested the money for the project. But when the
treaty was revoked by the state every thing is over then there is a question that what about the
loss. Will there be reimbursement. Moreover with the revocation of MFN status as there is a loss
to the good will of the country then will there be monetary compensation and damages will be
paid. Will the authorities make the state to be laible to pay the same.
Actually here it is proved by the very fact that as there is a loss. This loss is not the monetary one
but also the loss to the goodwill. This goodwill is very important in each for a of life and
especially in the trade. This situation may lead to heavy loss to Grandiana in refrence to the other
treaties being signed with the different countries. Hence your lordship it is a humble request to
grant the compensation and damages for the same.
41
PRAYER
The state of Grandiana respectfully request this honable dispute settlement body of the world
trade organization to do the following things:-
1) Resolve the dispute between the two states namely the state of Grandiana and the state of
Locasia.
2) Give an ordser to state of Locasia to pay the damages and compensation to the state of
Grandiana.

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TEAM CODE-01

AMITY UNIVERSITY INTERNATIONAL MOOT

IN THE DISPUTE SETTELMENT BODYOF WTO

THE CASE CONCERNING THE GATT TRADE PRINCIPLES

STATE OF LOCASIA (APPELANT)

STATE OF GRANDIANA.......................................... (RESPONDENT)

TABLE OF CONTENTS .............................................................................................................................. 2

WTO :- WORLD TRADE ORGANISATION

GATT :- GENERAL AGREEMENTON TRADE AND TARIFF

MFN : -- MOST FAVOURED NATION

VCLT :- VIENNA CONVENTION ON LAW OF TREATIES

DSU :- DISPUTE SETTELMENT UNDERSTANDING

DSB :- DISPUTE SETTELMENT BODY

Journals and research:-

Igor Ivanovich Lukashuk, The Principle PactaSuntServanda and the Nature of

Alexandre Kiss, Abuse of Rights in MPEPIL (December 2006, online edn)

Interpretation of treaties, Vienna convention on law of

Y.B.I.L.C 1966 International Law Commissions Commentary, II,

Agreement between WHO& EGYPT case ICJ reports 1980

untreaty.un.org, Law of treaties, International Law Commission, last update: 30

. TERMINATION OF OR WITHDRAWAL FROM A TREATY UNDER ITS

Watson 1992: 1117

The Ford Foundation, the UCLA Academic

Burley, supra note 2; Abbott, IR Prospectus, supra

M. Poonja, Termination of Treaties Owing to Fundamental Change of Circumstances

Mahmood M. Poonja, Termination of Treaties Owing to Fundamental Change of

Panel Report, European Communities Measures Prohibiting the Importation and

Conventions, acts and cases:-

Vienna convention on law of treaties

Nuclear Tests Case (n 2) para 46 (emphasis

ISSUE-1:- WAS THE REVOCATION OF TREATY BY STATE OF LOCASIA

A) Unreasonable and against the objectives of good faith

B) Abuse of rights and abuse of discretion- a hindrance to policy of good faith:-

C) Against the law of revocation of treaty as mentioned under Vienna convention

ISSUE:-2 WAS THE REVOCATION OF MFN STATUS A LEGAL ACT OR A

A) Ban on Imports:- on reasonable basis

B) Unreasonable basis of removing MFN

C) Gave alleged dumping A reason for putting contravelling duty

ISSUE-1:- WAS THE REVOCATION OF TREATY BY STATE OF LOCASIA

ISSUE:-2 WAS THE REVOCATION OF MFN STATUS A LEGAL ACT OR A

1) Revocation was on the baseless grounds.

ISSUE-1:- WAS THE REVOCATION OF TREATY LEGAL

1) Unreasonable and against the objectives of good faith:-

Abuse of rights and abuse of discretion- a hindrance to policy of good faith:-

Abuse of rights may take place in three distinct sets of circumstances:

(c) arbitrary exercise of a right causing injury to another party.9

The Vienna Convention on the Law of Treaties (VCLT) is a treaty concerning

TERRITORIAL SCOPE OF TREATIES

1. The validity of a treaty or of the consent of a State to be bound by a treaty may be

The termination of a treaty or the withdrawal of a party may take place:

(a) In conformity with the provisions of the treaty; or

A) In conformity with the provisions of the treaty and,

Termination or suspension of the operation of a treaty as a consequence of its breach

2. A material breach of a multilateral treaty by one of the parties entitles:

(a) a repudiation of the treaty not sanctioned by the present Convention; or

Meaning of Material breach:-

Fundamental change of circumstances25

2. A fundamental change of circumstances may not be invoked as a ground for terminating or

Procedure to be followed with respect to invalidity, termination,

Instruments for declaring invalid, terminating, withdrawing from or suspending the

ISSUE:-2 WAS THE REVOCATION OF MFN STATUS A LEGAL ACT OR A

Most-favoured-nation (MFN): Under the WTO agreements, countries cannot normally

This principle is known as most-favoured-nation (MFN) treatment . It is so important that it is

Ban on Imports:- on reasonable basis