Article 2 Scm Agreement

26. Norway also argued that the exhaustion of the local appeal obligation was a strict rule of international law, which applied only to international adjudication, unless an international agreement expressly did otherwise. There was no practice of international law that required the exhaustion of local remedies in any other type of international litigation. For example, international arbitration agreements did not depend on the requirement for the exhaustion of local remedies. Moreover, the international courts, which had applied the exhaustion of the local doctrine of appeal, had adopted a flexible approach when they were applied and had only demanded it after carefully weighing the practical and political disadvantages of exhaustion. In particular, international law subordinated the use of the exhaustion of local remedies to reasonable criteria and did not require such exhaustion when local remedies were insufficient and ineffective. 12 Norway did not have an appropriate remedy in the United States courts for violation by the United States of its GATT obligations. U.S. national law „does not require compliance with GATT legislation.“ 13 Indeed, a U.S. trade statute expressly stated that, under U.S.

law, no provision of a trade agreement or the application of such a provision to a person or circumstance is in contradiction with a U.S. statute. 14 In addition, many courts in the United States have refused to give full legal value to the general agreement. 15 Therefore, there were no effective local remedies in the United States that could be implemented in the event of a violation of the general agreement by the United States. 25. With regard to the doctrine of the exhaustion of local remedies, Norway presented the following. First, under international law, the rule of exhaustion of local remedies applies only to cases of diplomatic protection different from cases where a state is „directly violated“. In the dispute resolution procedure under the agreement, a signatory did not assert any rights on behalf of any of its nationals: the means derived from this procedure was the „direct harm“ suffered by a signatory by cancelling or invalidating the benefits due to that signatory or in the form of the impedance of the achievement of one of the objectives of the agreement. Second, in the text of the agreement, there was no basis for the application of the doctrine of the exhaustion of local remedies. Unlike many other international agreements that have exhausted local remedies, the agreement did not contain such a requirement. If the signatories intended to include such a requirement (which would have radically altered the procedural steps described in the dispute settlement provisions of the agreement), they would have expressly done so. Third, there has been no GATT practice that recognizes local teaching of remedies.

The GATT body had even suggested that the exhaustion of local remedies was necessary. As the panel`s latest reports show, the GATT practice was contrary to such a requirement. 11 The Vienna Convention on Treaty Law stipulates in Article 31, paragraph 3, paragraph b, that subsequent practice must be taken into account in interpreting the provisions of an international agreement.