Free Trade

Safeguarding IP rights is key to defeating COVID-19

COVID-19 has exposed our unpreparedness for a crisis of global scope. As much as globalisation is partly to blame for the virus’ speedy expansion, it is also thanks to the interconnectedness of our world that we have been able to preserve international trade – despite a bundle of constraints and cries for protectionism – during these tough times. In particular, that has to do with exports of essential medical devices such as masks, ventilators, personal protective equipment. The shortages experienced by many countries have triggered an intergovernmental discussion on the scope of compulsory licencing and IP protection covered by The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). 

As a global consumer advocacy group, we at the Consumer Choice Center are hereby sharing our perspective on the matter in the hope to contribute to this timely debate. 

The TRIPS agreement is an integral part of the World Trade Organisation’s intellectual property legal base. Among other things, the agreement whose primary aim is to safeguard intellectual property rights, also includes provisions on compulsory licencing, or use of subject matter of a patent without the authorisation of the right holder (Article 31). Essentially, this means that “in the case of a national emergency or other circumstances of extreme urgency or in cases of public non-commercial use,” a Member government may allow someone else to produce a patented product or process without the consent of the patent owner. 

Whereas, under normal circumstances, the person or company applying for a licence must have first attempted, unsuccessfully, to obtain a voluntary licence from the right holder on reasonable commercial terms (Article 31b). However, there is no need to try for a voluntary licence first under TRIPS flexibilities.

TRIPS flexibilities, therefore, allow countries to override global IP rules to mitigate the damage caused by an emergency and have been mainly applied where pharmaceuticals have been concerned. 

In July, South Africa issued a communication titled “Beyond Access to Medicines and Medical Technologies Towards a More Holistic Approach to TRIPS Flexibilities.”  It was pointed out that the COVID-19 response required looking beyond patents towards a more “integrated approach to TRIPS flexibilities that include other various types of intellectual property (IP) rights including copyrights, industrial designs and trade secrets” (IP/C/W/666). As such, the recommendations submitted by South Africa are cross-field as they also touch upon the production and distribution of essential medical devices such as masks, ventilators, personal protective equipment.

Though proposed out of the noble motives, South African communication is ignorant of the need to protect IP rights instead of eroding them. Opponents of intellectual property rights often make the mistake of taking innovation for granted thereby turning a blind eye to the driving force of every kind of entrepreneurship: economic incentives. Patents and various other forms of intellectual property are not biased towards the inventor. On the contrary, they ensure that companies can continue to innovate and deliver on their products to consumers. 

The short-term result of eroding intellectual property rights would be increased access to innovations, but in the long-term, there would be no innovation. With the second wave of coronavirus on the way putting brakes on the economic recovery, it is not something we can afford.

In fact, we need to stay as firm as ever in our defence of intellectual property rights if we want to defeat coronavirus and many more diseases. Patients who may one day be diagnosed with incurable diseases such as Alzheimer’s, Cystic Fibrosis, Diabetes, or HIV/AIDS should benefit from the chance that a cure will become available, and protecting IP is the only way to give them that chance. If we act boldly now and weaken intellectual property rights even further – and expand the scope of TRIPS flexibilities – we will cause the damage that will be hardly reversible, and the post-pandemic world will have to foot the bill.

As the former Czech Prime Minister, Jan Fischer pointed out, “Patents and other intellectual property protections enshrine the incentives that compel drug companies to take such extraordinary risks. By temporarily barring copycat products, the rules give innovators an opportunity to try and recoup their huge development costs. A substantial portion of the revenues achieved from the sale of those innovative drugs are dedicated to fund new projects, and enable the pursuit of path-breaking R&D in the first place.”

If we want more prosperity for all, we need to protect intellectual property rights. TRIPS flexibilities, and the call to extend their scope beyond patens, in particular, are an attempt to erode IP, and should be seen for what they really are: a threat to our economic recovery from COVID-19 and future innovation.

By Maria Chaplia, European Affairs Associate at the Consumer Choice Center

Global consumer advocacy group urges Malaysia to use Budget 2021 to address tobacco black market – Yahoo

Roeder said illegal cigarettes now command 62 per cent of the total market share cigarettes sold, making Malaysia the number one in the world for this black market. ― Picture by Miera Zulyana

KUALA LUMPUR, Sept 9 — An international consumer advocacy group is urging the government to use the upcoming Budget 2021 to implement measures to address the tobacco black market. 

Consumer Choice Center (CCC) wants the Malaysian government to take action against the tobacco black market and illicit trade, which it said is growing to become a serious threat to society and legal businesses.

Its managing director Fred Roeder said consumers are exposed to the risk of poorly-made and unregulated products with the black market.

“Transnational organised crime of illicit trade is a US$870 billion (RM3.6 trillion) problem. The global black market is not only immense but also growing rapidly. It is interesting to note that globally, the tobacco black market is higher in value than the illegal trade in oil, wildlife, timber, arts, cultural property, and blood diamonds combined,” he said in a statement.

Roeder argued that things are even more critical as illegal cigarettes now command 62 per cent of the total market share cigarettes sold, making Malaysia the number one in the world for this black market.

“Naturally this acute problem has and will continue to cause a severe drag to the economy while hurting consumers at large,” Roeder added.

In CCC’s recently-launched policy paper “Illicit Trade is Dangerous for Consumers”, it was found the tobacco black market damages public health and has been proven to finance organised crime. 

Additionally, it targets vulnerable groups in society while consumers are impacted because illegal cigarettes are produced in unsafe environments and using unsafe products.

It also highlighted that small retailers suffer considerably from the tobacco black market as they not only lose legitimate cigarette sales but also other items adult smokers usually buy from them.

“In addressing the tobacco black market, the Malaysian government should look into moderating tax policies to ensure that tax regimes do not create demand for more harmful illicit alternatives. 

“Simultaneously the government should increase the existing penalties for black market perpetrators and enforce these penalties dedicatedly, as the black market situation globally and in Malaysia is expected to deteriorate since consumers will turn to cheaper alternatives due to job security and income stretch resulting from the global Covid-19 pandemic,” he said.

The policy paper is available at consumerchoicecenter.org

Originally published here.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

Global consumer advocacy group urges Malaysia to use Budget 2021 to address tobacco black market

Roeder said illegal cigarettes now command 62 per cent of the total market share cigarettes sold, making Malaysia the number one in the world for this black market. ― Picture by Miera Zulyana

KUALA LUMPUR, Sept 9 — An international consumer advocacy group is urging the government to use the upcoming Budget 2021 to implement measures to address the tobacco black market. 

Consumer Choice Center (CCC) wants the Malaysian government to take action against the tobacco black market and illicit trade, which it said is growing to become a serious threat to society and legal businesses.

Its managing director Fred Roeder said consumers are exposed to the risk of poorly-made and unregulated products with the black market.

“Transnational organised crime of illicit trade is a US$870 billion (RM3.6 trillion) problem. The global black market is not only immense but also growing rapidly. It is interesting to note that globally, the tobacco black market is higher in value than the illegal trade in oil, wildlife, timber, arts, cultural property, and blood diamonds combined,” he said in a statement.

Roeder argued that things are even more critical as illegal cigarettes now command 62 per cent of the total market share cigarettes sold, making Malaysia the number one in the world for this black market.

“Naturally this acute problem has and will continue to cause a severe drag to the economy while hurting consumers at large,” Roeder added.

In CCC’s recently-launched policy paper “Illicit Trade is Dangerous for Consumers”, it was found the tobacco black market damages public health and has been proven to finance organised crime. 

Additionally, it targets vulnerable groups in society while consumers are impacted because illegal cigarettes are produced in unsafe environments and using unsafe products.

It also highlighted that small retailers suffer considerably from the tobacco black market as they not only lose legitimate cigarette sales but also other items adult smokers usually buy from them.

“In addressing the tobacco black market, the Malaysian government should look into moderating tax policies to ensure that tax regimes do not create demand for more harmful illicit alternatives. 

“Simultaneously the government should increase the existing penalties for black market perpetrators and enforce these penalties dedicatedly, as the black market situation globally and in Malaysia is expected to deteriorate since consumers will turn to cheaper alternatives due to job security and income stretch resulting from the global Covid-19 pandemic,” he said.

The policy paper is available at consumerchoicecenter.org

Originally published here.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

The WTO is Missing In Action on COVID

According to the World Trade Organisation (WTO)’s latest report to the United Nationès High-level Political Forum (HLPF), global trade will fall by between 13% and 32% in 2020 as a consequence of the economic disruption caused by the COVID-19 pandemic. It is expected that the decline will exceed the collapse brought on by the global financial crisis of 2008-2009, and nearly all regions will suffer double-digit declines in trade volumes in 2020.

The prediction is grim but not surprising. The world was simply not prepared for the pandemic, and, while a lot can be said about whether opting for lockdowns was a reasonable decision or not, what matters more now is the logic behind rushed economic policies. International trade implies interdependence and trust, and, therefore, unilateral withdrawal from a trading relationship is damaging and costly.

More specifically, this has to do with export restrictions on medical supplies and food. In the midst of the pandemic, 72 WTO members and eight non-WTO member countries banned or limited the export of face masks, protective gear, gloves and other goods. In a similar fashion, 15 countries globally made it harder or impossible to export food.

In the said report, the WTO draws attention to the chaotic nature of those trade regulations and lack of international cooperation and coordination. Most countries didn’t notify the WTO of their intentions to restrict trade, and this tells us two things. First, the WTO needs urgent reform to justify its institutional necessity. Second, regardless of how integrated and globalised the world might seem, true power remains with nation-states.

The good news is that the WTO is due to elect its new director-general, and some candidates seem to have a good grasp of what needs to be done to reshape the organisation. One of the frontrunners Amina Mohamed, a 58-year-old minister and former WTO chair, argues that “the [WTO] rulebook needs to be upgraded because of the concerns that are being expressed about the rules not being fit for purpose.”

The persistence of nation-statism is undeniable, and the pandemic has reinforced some of its key traits such as self-sufficiency. Being able to stand on two feet instead of waiting for others to give you a hand and, generally, being concerned only with oneself has become a protectionist mantra during the pandemic. Changing the prevalent narrative in favour of more cooperation and independence is one of the biggest challenges the new WTO DG will face.

However, it’s not all gloom and doom. The COVID-19 situation has revealed that a number of essential goods, such as ventilators or medical-style face masks had previously been burdened with tariffs. Removing many of these trade barriers has been helpful during the crisis, yet these measures are equally unnecessary outside the realms of the Novel Coronavirus. This is a positive shift and the one that needs to be endorsed by the WTO and all its members individually.

The WTO’s impact has been consistently declining over time, and the pandemic exposed its weakest sides: lack of coordination. The coronavirus crisis is not the first and definitely not the last challenge we face, but whatever happens, we should preserve free trade at all costs. The WTO is a much needed organisation, but it has to change.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

Введение на Украине квот на импорт удобрений может привести к катастрофе

Введение на Украине квот на импорт удобрений может привести к катастрофе

Еврокомиссар по вопросам торговле Фил Хоган (Phil Hogan) направил письмо властям Украины, согласно которому крупнейшие европейские производители минеральных удобрений просят их воздержаться от введения ограничений на ввоз агрохимикатов из Европейского Союза.

В нем утверждается, что «главная цель этого процесса – убрать минеральные удобрения, выпущенные в Европейском Союзе с украинского рынка».

По мнению юриста Consumer Choice Center Марии Чапли, введение квот на импорт минеральных удобрений из Европейского Союза «нанесет не только ущерб европейским производителям, но и сельскому хозяйству Украины. Такая политика – крайне безответственна, и ее последствия будут катастрофическими».

«Торговля с Европейским Союзом очень выгодна для Украины, поскольку она позволяет производить дешевые продукты питания. Торговля – это то, что правительство Украины должно укреплять, а не пытаться подрывать», — резюмировала она.

Originally published here.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

Après cette crise, ne cédons pas au protectionnisme

Face à la crise du COVID-19, nous entendons de plus en plus d’appels en faveur d’une politique économique protectionniste. Cependant, cette politique est intellectuellement en faillite depuis des siècles et nuit au bien-être des consommateurs.

Au niveau politique, le COVID-19 nous a montré une chose : les positions politiques sont bien enlisées. Tous les bords politiques se sentent confirmés dans leurs visions du monde précédant cette crise. Les socialistes affirment que cette crise confirme que la sécurité sociale n’est pas assez développée. Pour les nationalistes, c’est la globalisation et l’ouverture des frontières qui a causé cette pandémie. Les fédéralistes européens pensent que la crise COVID-19 démontre l’importance de la  centralisation des décisions dans l’Union européenne. Enfin, les écologistes trouvent que la baisse drastique de la production permet une société plus propre et qu’il est possible de vivre avec beaucoup moins..

Comme tous ces groupes, les protectionnistes jouent leur propre jeu politique et affirment que non seulement il nous faut plus de droits de douane mais aussi qu’il faut “faire revenir” la production en Europe. 

Ils se plaignent de la dépendance européenne face à des pays comme la Chine ou l’Inde et que cette crise a montré l’intérêt de rapatrier des industries qu’ils jugent plus essentiels que d’autres. Les idées protectionnistes ont la particularité d’être représentées autant à l’extrême-gauche qu’à l’extrême-droite voir même au centre du spectre politique. Il s’avère que le protectionnisme est ancré dans notre esprit politique depuis des siècles.

Le colbertisme semble éternel

Jean-Baptiste Colbert, ministre des finances sous Louis XIV, s’était engagé dans une avalanche d’octroi de monopoles, de subventions de luxe et de privilèges de cartels, et avait mis en place un puissant système de bureaucratie centrale régenté par des fonctionnaires appelés intendants. Le rôle de ces derniers était de faire respecter le réseau de contrôles et de réglementations qu’il avait créé. 

Son système fonctionnait également à grand coups d’inspections, de recensements et de formulaires pour pouvoir identifier les citoyens qui auraient pu s’écarter des réglementations de l’État. Les Intendants ont utilisé un réseau d’espions et d’informateurs pour découvrir toutes les violations des restrictions et des réglementations du cartel. De plus, les espions se surveillaient les uns les autres. Les sanctions pour les violations allaient de la confiscation et la destruction de la production jugée “inférieure”, à de lourdes amendes, des moqueries publiques voir même l’interdiction d’exercer sa profession.

Colbert était aussi convaincu que le commerce international était un jeu à somme nulle. S’inspirant des idées du mercantilisme, il estimait que l’intervention de l’État était nécessaire pour assurer qu’il garde une plus grande partie des ressources à l’intérieur du pays. Le raisonnement est assez simple : pour accumuler de l’or, un pays doit toujours vendre plus de biens à l’étranger qu’il n’en achète. Colbert cherchait à construire une économie française qui vendait à l’étranger mais qui achetait sur le marché intérieur. L’ensemble des mesures économiques de Jean-Baptiste Colbert était connu sous le nom de “colbertisme”.

De nos jours, ce système est connu sous le nom de “protectionnisme”, et reste tout à fait courant dans la pensée politique. En Europe, nous avons abandonné cette philosophie économique (même si la Commission européenne accepte que certains Etats membres subventionnent leurs industries locales en cas de crise), mais vers l’extérieur, l’UE a maintenu trois catégories de mesures protectionnistes :

  1. Les taxes douanières par le tarif extérieur commun,
  2. Les normes de production qui imposent des coûts de convergences,
  3. Les subventions aux producteurs locaux, à travers la Politique Agricole Commune (PAC).

La question est de savoir si ces mesure protègent réellement l’économie européenne. S’il convient de retourner dans le temps pour expliquer les origines du protectionnisme, il faudrait également tirer quelques leçons du passé. Dans son Traité d’économie politique publié en 1841, l’économiste français Jean-Baptiste Say expliquait :

“L’importation des produits étrangers est favorable à la vente des produits indigènes ; car nous ne pouvons acheter les marchandises étrangères qu’avec des produits de notre industrie, de nos terres et de nos capitaux, auxquels ce commerce par conséquent procure un débouché. — C’est en argent, dira-t-on, que nous payons les marchandises étrangères. — Quand cela serait, notre sol ne produisant point d’argent, il faut acheter cet argent avec des produits de notre industrie ; ainsi donc, soit que les achats qu’on fait à l’étranger soient acquittés en marchandises ou en argent, ils procurent à l’industrie nationale des débouchés pareils.”

Considérer l’échange international, surtout dans une perspective de “déficit commercial”, comme un jeu à somme nulle, est erroné. L’idée qu’il faille faire revenir l’industrie en Europe, probablement à travers des mesures commerciales, est également fallacieuse. Il s’avère que la libéralisation des liens commerciaux est avantageux à la fois pour les pays exportateurs et ceux qui importent : les ressources entrant nous procurent la possibilité d’améliorer notre situation économique. 

L’acte commercial bénéficie aux deux acteurs et non à un seul. Croire que seul le vendeur est gagnant (car il gagne de l’argent) est une incompréhension économique grave.

Certes la crise du COVID-19 est très problématique, et nous voyons en effet une pénurie de certains matériaux médicaux. Ceci dit, produire des gants et masques en Europe ne sera pas viable économiquement et qui nous dit que les mêmes outils seront nécessaires pour la prochaine crise sanitaire ? Ceci nous montre encore une fois l’erreur fatale de penser qu’il serait possible d’organiser la société et son économie par une planification centrale gérée par l’Etat.

Tout comme le disait Jean-Baptiste Say dans ses oeuvres, pour (re)lancer l’activité économique, il faut enlever les mesures qui nous ralentissent, dont la bureaucratie excessive et l’excès de taxes. En d’autres termes, il s’agit de ne pas entraver les échanges mais plutôt permettre la multiplication des échanges.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

Consumer nationalism will lead to the downfall of free trade

The post-coronavirus world will not only be shaped by its policies, but by its narratives. By appealing to the desire to protect domestic economies, nationalism is likely to become a defining feature of consumer behaviour in the years to come.

Multiple countries have launched “buy domestic” initiatives as part of national efforts to alleviate the economic consequences of the pandemic. The idea was vehemently endorsed by farmers in the UK who urged the public to buy British and support local agriculture.

Even more strikingly, French finance minister Bruno Le Maire told supermarkets to “stock French products”, showing a complete disregard for the ethos of the single market. This is just a hint of what is to come.

Such rhetoric was triggered mainly by the disruption of supply chains as a result of emergency measures. Most governments were unprepared for the outbreak of a deadly virus, and this has made them appear weak and incapable.

Though well-intentioned, rushed decisions such as lockdowns are a consequence of an economic, moral and mental gridlock that governments found themselves in. It is very human to blame everyone but oneself, so governments – which failed to ensure a free flow of goods in case of emergency – chose to blame their reliance on imports from other countries.

It’s an easy solution, and a frightened electorate will likely buy into the self-sufficiency narrative. Combine it with nationalism and trade barriers and the downfall of free trade will be unavoidable.

The concept of consumer nationalism was developed by the University of South Carolina’s Terence Shimp and Subhash Sharma. It is used to refer to consumers’ beliefs “about the appropriateness, indeed morality, of purchasing foreign-made products”. Ethnocentric consumers believe that purchasing imported products should be avoided because “it hurts the domestic economy, causes loss of jobs, and is plainly unpatriotic”.

Unlike tariffs and other trade barriers, consumer nationalism can be enforced independently and often doesn’t have to be paired with tangible interventions such as putting domestic products on front shelves in supermarkets. 

The power of consumer nationalism is that it has a propensity to impact economic events and move the needle away from free trade. At its core, “buy British to save the economy” is a very simple narrative that speaks to our sense of identity and our desire to contribute to the revival of the economy.

Spread through media and the word of the mouth, narratives affect consumer behaviour more than we can imagine. No one has explained the phenomenon better than Robert Shiller, a professor at Yale University, who argued that economic events are substantially driven by the contagious spread of oversimplified and easily transmitted variants of economic narratives. 

The most popular anti-trade narrative is that free trade destroys jobs, and its spread is far-reaching. In 2016, a CBS poll asked Americans: “Overall, would you say US trade with other countries creates more jobs for the US, loses more jobs for the US, or does US trade with other countries have no effect on US jobs?”

Roughly 15 per cent of respondents said that trade has little or no effect on the number of jobs. Around seven per cent were unsure. Of the others, 29 per cent thought trade created jobs and 48 per cent thought it destroyed them.

When asked outside the job narrative context, 43 per cent of respondents said that free trade helped the economy while 34 per cent said it hurt it. The most ironic part is that the prevalence of anti-trade narratives is an excellent way for governments to justify actual interventions. 

Milton Friedman once said: “The way you solve things is by making it politically profitable for the wrong people to do the right things.” If we apply this logic to narratives, it turns out that the intentional spread of narratives makes some policies politically profitable in the long run since the nudged electorate comes to believe it’s in their interest to pay more for domestic products – because we have to save the economy! 

As such, the “buy domestic” narrative is a voluntary nudge that may or may not work, and there is nothing wrong with it, per se. After all, some consumers really want to pay more for domestic products.

The worry, however, is that it might, in the end, be translated into import restrictions and leave no choice to those who prefer imported goods. The voice of the minority of consumers – who don’t want to make what is framed by governments as a “necessary sacrifice” – will be left out.

Trade has lifted billions of people out of poverty by expanding our consumer choice through lower prices and increased variety of goods. It hasn’t got the credit it deserves, and the average person probably doesn’t realise that by buying foreign goods they are engaging in a global-wide exchange that has, among other things, enhanced peaceful relations between countries. 

The pandemic is a test for us all, and we are all looking for something in our world order to blame. Free trade isn’t what caused the pandemic, but it is what can help make the post-coronavirus world better. And that is the narrative that needs championing more than ever.

Originally published here.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

EU to retaliate: Last thing we need now is the EU-US trade war

impose tariffs

BRUSSELS – Yesterday, the European Commission announced the European Union will impose tariffs on US exports of lighters, furniture coatings and playing cards. “The EU is adopting measures in reaction to the U.S. extension of its import duties on steel and aluminium to certain derivative products,” a Commission spokesperson told POLITICO.

Counterproductive To Impose Tariffs On US Products?

In response, Luca Bertoletti, Senior European Affairs Manager at the Consumer Choice Center, said that “this move from the Commission is very dangerous. In a moment of crisis such as this, it appears counterproductive to impose tariffs on US products especially since the US is one of the leading partners to fight the battle against COVID-19.

“There is always what’s seen and what’s unseen. By aiming to hit the US where it hurts in a trade war, the EU will end up hurting its own consumers, not only US exporters. A peaceful transatlantic trade dependency, not a destructive trade war should be the way forward,” said Maria Chaplia, CCC European Affairs Associate.

“Trade wars are a lose-lose game. Trade agreements, on the contrary, are not only rewarding because they benefit consumers on both ends, but also because they build bridges of partnership and cooperation between nations. Sometimes victory is about choosing to restrain from retaliation. Especially, when it comes to trade,” concluded Chaplia.

Should the US impose tariffs on the EU, China, Japan or others? Let us know in the comments section.

Originally published here.


About Consumer Choice Center

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org.

Force Majeure during the COVID-19 Pandemic

By Linda Kavuka, Trade Policy Fellow, Consumer Choice Center

Blog Post

Confirmed cases of the novel coronavirus (COVID-19), which first appeared in China at the end of last year, are currently over 800,000 as of April 1st 2020. What was initially seen as a largely China-centric shock has now become a global pandemic. 

Global consequences of the COVID-19 pandemic have included grounding of flights and limited international travel, closure of public markets, issuance of curfews and also lock-down of countries and cities where there has been rapid spread of the virus. Governments have advised employers to allow their staff to work from home, called for closures of schools and banned all social gatherings, including religious meetings. People have been urged to observe very high levels of hygiene and to thoroughly wash hands with soap and water and use sanitizers in the alternative. 

The International business community has not been spared of the said shocks. With the end of the pandemic unclear, the economic impact is expected to be very severe globally. Considering the disruptions to international supply chains that have occurred as a result of the COVID-19 pandemic, it is expected that many players in the International Trade community will be caught up with non-performance of their contractual obligations, and lawsuits shall follow. Does the COVID-19 pandemic qualify for the operation of the Force Majeure clause as a relief to affected parties?

Ordinarily, when entities and individuals trade with each other, they sign contracts that legally bind them to their agreements. The contracts list obligations of the parties and also circumstances that would call for the termination or suspension of the said obligations. One of the circumstances that could excuse non-performance or termination of a contract is legally known as “Force Majeure”, one of the standard clauses of a contract. 

Article 7.1.7 (1) of the UNIDROIT Principles defines Force Majeure as follows:

Non-performance by a party is excused if that party proves that the non-performance was due to an impediment beyond its control and that it could not reasonably be expected to have taken the impediment into account at the time of the conclusion of the contract or to have avoided or overcome it or its consequences.”

If the said Impediment is temporary the defaulting party shall be excused for a reasonable period of time. The Force Majeure Clause only takes effect where the defaulting party gives notice to the other party explaining the impediment and the impact it has had on the expected performance, otherwise the defaulting party shall be liable for damages. In order for a party to rely on the Force Majeure defense, the clause must be included in their contract contract and the impediment causing non-performance of their obligation must be expressly stated.

An example of a Force Majeure clause in a Sale Contract reads as follows:

Either party shall be relieved of all responsibility for any failure or delay for the carrying out of their obligations hereunder due to product discontinuation, manufacturer price changes, supplier price changes, changing market conditions, strikes, riots, civil unrest or an act of civil or military authority, combinations or restrictions of work, Act of God, war, insurrection, fire not caused by its act or omission or that of its servants or invitees on the property, tempest, industrial disputes, an act of a public enemy, a boycott, embargoes, failure of communications systems unavoidable accident or any other circumstances beyond its reasonable control whether or not the same be ejusedem generis with those above.”

Since Pandemics with such severe impacts are uncommon they are usually not expressly provided for in contracts. Events from the past month to date are a clear indication of a situation that is beyond control, and may lead to involuntary breach of contract by parties who fail to meet their contractual obligations. Parties that do not have Force Majeure clauses and are unable to meet their obligations can plead Frustration of Contract which defense does not require prior inclusion in their contracts.

Medical professionals around the world are working tirelessly to find a cure for the COVID-19 virus and are currently testing some combinations of medication. A fact is that we cannot forecast when things will be back to normal and the International trading markets restored. While policy focus by most affected governments has been to provide safety nets for their economies with measures such as food donations and grants to needy families, tax reductions and pay cuts for some officials, unfortunately businesses have been left to think fast and make tough decisions to remain afloat.

Time is of the essence for those who wish to rely on the Force Majeure and Frustration of contract defenses for their non-performance and a reminder that ignorance of the law is not a defense as a rule of thumb. Players of the International trade market and policy makers will all have to act in good faith for the sake of survival as we all anticipate the end of the pandemic, after-which a whole new world order shall begin.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

Embracing free trade during a pandemic

Whether we will be able to get back on track on globalisation and economic liberalisation will be one of the most important tests for the post-coronavirus world. While lockdowns introduced by some governments are hopefully not going to stay there indefinitely, the perception of the role of international cooperation is likely to undergo some substantial shifts in the long run. International trade as a key instrument of promoting peace and prosperity will be a first casualty.

The EU-Mercosur agreement and the UK government’s ambition to become a global champion of free trade have become some of the most recent exciting developments. Despite a popular belief that free trade has been in decline for a couple of years, the number of new interventions implemented each year globally has sharply dropped. On the other hand, It would, of course, be desirable to see more liberalising policies instead but sometimes the absence of damaging action is sufficiently good in itself.

Graph Number of Interventions
Source: globaltradealert.org

The outbreak of COVID19 which has shattered the very roots of international cooperation also threatens this dynamic. One after another, countries have turned inwards to deal with the pandemic and shut themselves down from the rest of the world. Lockdowns are a timely reminder that in spite of globalisation – or even hyper globalisation in case of the EU – nation-states remain the driving force of global order. Where does this leave international trade?

International trade has lifted billions out of poverty and benefited consumers of all nations, races, and genders. More importantly, it has encouraged states to look beyond their borders to improve things at home through an increase in choice and lower prices as well as more export opportunities. By facilitating and sustaining integrated supply chains, the success of international trade made states mutually dependent. For better or worse, the concept of the all-producing nation-state was dissolved in international trading relationships.

Trade protectionism originated as an aspiration to achieve self-sufficiency and reduce reliance on foreign supplies. At the outset of trade interventionism, uncontrollable factors such as the possibility of crop failure in other countries were used to justify import restrictions and the subsidising of domestic agriculture. The inconsistency of such a worldview was that countries that promoted self-reliance were in no way immune to bad harvests themselves and hence had to turn to others in their hour of need. 

China is currently being affected by 6490 harmful trade interventions, the highest in the world. Ironically, the origin of COVID19 also comes from the city of Wuhan in China. President Trump – known for his extremely hostile attitude to trade with China – even called it the “Chinese virus”. It sounds like an excellent excuse to introduce more tariffs in the future, doesn’t it?

Graph Harmful
Source: globaltradealert.org

The idea of national self-sufficiency sounds great on paper but it is very hard to achieve now that we have progressed so far with globalisation. From iPhones to agriculture and vital drugs, we are dependent on other countries, and especially on China. 

Even in the EU, lockdowns and travel restrictions imposed on national levels have resulted in new border checks causing traffic jams and supply delays. “All our food is getting to the warehouses — with delays — but it’s getting there,” said Bart Vandewaetere, vice president for government relations at Nestlé. In the worst-case scenario, we would be left without food on our shelves. Hence why the first thing governments should do before imposing emergency measures is ensuring the unrestricted and smooth flow of goods. 

We will wake up to a totally different world once the pandemic is over. More countries will likely want to move the needle away from globalisation and mutual dependency to avoid the spread of new viruses in the future. Though trade cannot halt the pandemic, it can help us get through it by ensuring that essentials make it to us thus mitigating some of its consequences. At all times, we need more trade, not less.


The Consumer Choice Center is the consumer advocacy group supporting lifestyle freedom, innovation, privacy, science, and consumer choice. The main policy areas we focus on are digital, mobility, lifestyle & consumer goods, and health & science.

The CCC represents consumers in over 100 countries across the globe. We closely monitor regulatory trends in Ottawa, Washington, Brussels, Geneva and other hotspots of regulation and inform and activate consumers to fight for #ConsumerChoice. Learn more at consumerchoicecenter.org

Scroll to top