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Does the Container Security Initiative Comply with WTO Law?

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Does the Container Security Initiative Comply with WTO Law? Securing the Supply Chain: Does the Container Security Initiative Comply with WTO Law? INAUGURAL-DISSERTATION Zur Erlangung des akademischen Grades eines Doktors der Rechte durch die Rechtswissenschaftliche Fakultät der Westfälischen Wilhelms-Universität zu Münster Vorgelegt von Christopher Dallimore Aus Wells, Somerset, Großbritannien 2008 Erster Berichterstatter: Prof. Dr. Hans-Michael Wolffgang, Institut für Zoll- und Verbrauchsteuerrecht, Westfälische Wilhelms-Universität Münster, Deutschland Zweiter Berichterstatter: Prof. Dr. David Widdowson, Centre for Customs and Excise, University of Canberra, Australien Dekan: Prof. Dr. Hans-Dietrich Steinmeyer Tag der mündlichen Prüfung: 11. November 2008 Foreword This study was accepted as a dissertation by the Law Faculty of the Wilhelminian University of Münster in Westphalia during the winter semester of 2008. I would like to thank Professor Dr. Hans-Michael Wolffgang for his supervision and support during the writing of the study and Professor Dr. David Widdowson of the Centre for Customs and Excise of Canberra University, Australia for producing the second opinion. I dedicate this work to my parents and brother, in recognition of their encouragement and support. Münster im November, 2008 Christopher Dallimore EXECUTIVE SUMMARY ..................................................................................................... 1 INTRODUCTION ................................................................................................................... 5 THESIS AND METHOD OF INVESTIGATION................................................................ 9 A. MARITIME SECURITY MEASURES FOLLOWING 9/11................................... 12 1. IMPLEMENTATION STRATEGIES .................................................................................. 13 1.1. Unilateral Security Measures .......................................................................... 13 1.2. Bilateral Agreements ....................................................................................... 16 1.3. Multilateral Framework .................................................................................. 17 1.4. Advantages and Disadvantages of Unilateral and Multilateral Approaches .. 20 2. SECURITY MEASURES AT NATIONAL LEVEL .............................................................. 23 2.1. The Maritime Transportation Security Policy of the United States ................. 23 2.1.1 The Container Security Initiative..................................................................................28 2.1.2. The Customs-Trade Partnership Against Terrorism....................................................29 2.1.3. The Secure Freight Initiative.........................................................................................30 2.1.4. The Megaport Initiative.................................................................................................32 2.1.5. Operation Safe Commerce ............................................................................................32 2.1.6. The Proliferation Security Initiative.............................................................................33 2.1.7. The Smart Box Initiative ...............................................................................................34 2.2. Legislative Instruments Relating to the CSI..................................................... 34 2.2.1. Homeland Security Act 2002........................................................................................35 2.2.2. US PATRIOT Act 2002 ................................................................................................36 2.2.3. The Maritime Transportation Security Act 2002.........................................................37 2.2.4. The Trade Act 2002.......................................................................................................38 2.2.5. The Security and Accountability for Every Port Act 2006.........................................39 2.2.6. Implementing Recommendations of the 9/11 Commission Act 2007 .......................41 3. SECURITY MEASURES AT INTERNATIONAL LEVEL ..................................................... 42 3.1. International Organizations............................................................................. 45 3.1.1 United Nations’ Resolutions .........................................................................................46 3.1.2. Co-operative G8 Action on Transport Security...........................................................47 3.1.3. International Ship and Port Facility Security Code.....................................................48 3.1.4. The WCO Framework of Standards.............................................................................49 3.1.5. The SUA Convention 1988...........................................................................................51 3.1.6. Other Instruments Relevant to Maritime Security.......................................................53 3.2. The European Union........................................................................................ 56 4. CONCLUSION .............................................................................................................. 57 B. THE CONTAINER SECURITY INITIATIVE......................................................... 61 1. SUBSTANCE OF THE MEASURE ................................................................................... 61 1.1. Use of Terminology in the Container Security Initiative......................................... 65 1.2. Identification of High-Risk Containers............................................................ 70 1.2.1. The 24 Hour Rule ..........................................................................................................71 1.2.2. Data Processing and Risk Assessment.........................................................................75 1.3. Pre-Screening Containers at the Port of Departure........................................ 77 1.3.1. The Declaration of Principles .......................................................................................80 1.3.2. Stationing of U.S. Customs Officers at Foreign Seaports...........................................85 1.4. Use of Technology to Scan High-Risk Containers........................................... 87 1.5. Use of Smarter, Tamper-Evident Containers................................................... 90 1.6. Benefits of CSI Participation ........................................................................... 92 2. ADMINISTRATION ....................................................................................................... 93 2.1. The Department of Homeland Security........................................................................94 i 2.2. The Directorate of Border and Transportation Security..............................................96 2.3. U.S. Customs and Border Protection Bureau (CBP)...................................................97 2.4. The National Targeting Centre (NTC).......................................................................103 2.5. Government Accountability Office ............................................................................103 3. CONCLUSION ............................................................................................................ 104 C. COMPLIANCE WITH WTO LAW......................................................................... 112 1. INTRODUCTION ........................................................................................................ 112 1.1. Scope of Investigation.................................................................................... 114 1.2. Methodology .................................................................................................. 115 2. TRADE EFFECTS OF THE CONTAINER SECURITY INITIATIVE ..................................... 115 2.1. Trade in Services ........................................................................................... 116 2.2. Trade in Goods .............................................................................................. 119 2.3. Parties Affected by the Container Security Initiative..................................... 121 2.4. Complaints by Private Parties ....................................................................... 123 2.5. Complaints by Member States ....................................................................... 127 3. THE GENERAL AGREEMENT ON TRADE IN SERVICES ............................................... 128 3.1. Introduction ................................................................................................... 128 3.2. Maritime Transportation Services under the GATS....................................... 129 3.3. The ‘Standstill Commitment’ ......................................................................... 131 3.4. Result ............................................................................................................. 135 4. RELATIONSHIP BETWEEN THE GATS AND THE GATT ............................................. 135 5. COMPLIANCE WITH THE GENERAL AGREEMENT ON TARIFFS AND TRADE ............... 137 5.1. Introduction ................................................................................................... 137 5.1.1. The Complainant..........................................................................................................139 5.1.2. Burden of Proof for General Measures ......................................................................141
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