The US has recently passed a Proclamation on 22nd June 2020, temporarily suspending till the end of the current year, several popular non-immigrant visas including the H-1B, H-2B, J and L visas. The Proclamation aims at protecting local workers who are facing unemployment due to spread of coronavirus. Apart from J visas which include certain categories of non-experienced people, all the visa requires certain expertise and higher education degree.
The present article seeks to analyze the legal validity of US’s Proclamation under the WTO Agreements, particularly General Agreement on Trade in Services (GATS) by exploring the consistency of the Proclamation with the specific commitments undertaken by the US under GATS and if the Proclamation violates such commitments, then the possible defence for this discriminatory measure under the exception clauses of GATS.
Compliance of the US with its commitments under its Schedule of Commitments
GATS contain two types of obligation– one is general obligations that apply to all members and services sectors for example- Most Favored Nation treatment, and another is specific obligations that apply only to the sectors inscribed in a member’s schedule of commitments (SoC). Commitments are undertaken in SoC concerning four different modes of service supply. Most schedules consist of both sectoral and horizontal sections. The Horizontal Commitments contains commitments/conditions that apply across all sectors subsequently listed in the schedule. Sector Specific Commitments identifies the services for which the member guarantees market access and national treatment and any attached limitations. SoC allows member to deviate from general obligation of providing non-discriminatory treatment by listing the discriminatory measures in its SoC. The Proclamation, to stand the test of non-discrimination, needs to either be covered under the US’s GATS commitment in its SoC or it must fulfill the requirements of exception clauses under GATS which provides grounds where parties can deviate from its obligations under this Agreement.
Mode 4 i.e. presence of natural persons is the relevant mode here as this mode regulates the entry of one member into the territory of another member to supply a service. In the sector-specific commitments under the SoC of the US, it has in almost all services sectors, not made any commitments except in cases where the foreign service suppliers fulfil the conditions mentioned in the horizontal section. In its horizontal commitments, the US has only laid down requirements regarding the eligibility of the foreign service suppliers for respective categories and the duration of their stay. For instance- Intra-corporate Transferees which includes managers, executives and specialists, as defined in the section, can only stay in the US for a three-year period that may be extended for up to two additional years for a total term not to exceed five years. Even in the horizontal section, no such domestic laws/regulation has been referred to which allows the US to suspend the visas temporarily.
The Schedule, nowhere, imposes any conditions where despite fulfilling the requirements mentioned in the horizontal section, the US can suspend such visas.
Compliance with the requirements of General Exception
Since there is no legal validity found in US’s commitments under its SoC, US may claim that the alleged measure, i.e. the Proclamation falls under one of the Exception clauses of GATS.
GATS provides two types of exception where the Members can deviate from its obligation undertaken in this Agreement and take such measures which violate its commitments, i.e.- General and Security Exceptions. The Security exception is only invoked when there is a risk to the national security of the nation, and it is necessary to protect its essential security interest. This exception can’t be invoked in the present case by the US as foreign service suppliers working in IT sectors or fashion designing company doesn’t pose any security risks to the US.
However, the general exception lists down 6 circumstances which includes various cases from protecting human health to preventing fraudulent practices. The Proclamation has only used the phrase “in the interest of US” and “high unemployment” as the justification for issuing such Proclamation. The relevant part of the Proclamation states- ‘I determined that, without intervention, the United States faces a potentially protracted economic recovery with persistently high unemployment if labour supply outpaces labour demand……..I have determined that the entry, through December 31, 2020, of certain aliens as immigrants and nonimmigrants would be detrimental to the interests of the United States.’ The only clause that might be invoked by the US as a ground for its GATS inconsistent measure will be – (a) necessary to protect public morals or to maintain public order or (b) protection of human, animal plant life or health.
WTO GATS jurisprudence shows that Article XIV provides for analysis in step-test i.e.- (i) first, the WTO Dispute Settlement Body (DSB) must determine whether the measure falls within the scope of one of the subparagraphs of Article XIV of the GATS; and (ii) after having found that the measure at issue is justified under one of the subparagraphs of Article XIV of the GATS, the DSB must examine whether this measure satisfies the requirements laid down in the introductory clause or chapeau of Article XIV of the GATS (Argentina – Financial Services).
To judge US measure’s compatibility with the requirements of Article XIV, we need to follow the two-tier analysis which involves first looking at the measure itself under the sub-paragraphs and then at how the exception is applied under the chapeau (US-Gambling).
US may invoke Article XIV (a) or (b) as a ground for protecting public order or human lives from the impact of COVID-19. However, the nature of measures falling under public order or human lives has never included anything relating to visa issues but owing to the widespread harm caused by COVID-19, it might be possible that WTO DSB finds the invocation of such clauses as valid.
To comply with the requirement of clauses of Article XIV, the US must establish the necessity of the measure in pursuing the objective that falls within the sub-clauses. The necessity test involves weighing and balancing process where three important factors are “weighed and balanced” to determine necessity, although not exhaustive factors (Korea-Various Measures on Beef, US-Gambling):
- the relative importance of the interests of values furthered by the impugned measure;
- the contribution of the measure to the realization of the ends pursued by it; and
- the restrictive impact of the measure on international commerce
Firstly, the Proclamation needs to be protecting the interests which are of relative importance. In Korea- Various Measures on Beef, the Appellate Body emphasized that the necessity requirement can be more easily satisfied when the common interests or values advanced by the challenged measure are of vital importance. Applying the same rationale in the present case, US may argue that protecting its vulnerable or disadvantageous citizen from unemployment is of vital importance, especially in the times of a pandemic and the WTO DSB may agree with this line of argument.
Secondly, the Proclamation must fulfil the means-ends test where the suitability or aptitude of a measure to achieve the ends pursued is examined. The more the challenged measure contributes to the achievement of the legitimate policy objectives, the more likely it is that the measure will be deemed necessary (Korea- Various Measures on Beef). The Proclamation seeks to address the issue of high unemployment which is adversely affecting the unemployed Americans from the threat of competition for scarce jobs. It also lists down the workers against whom the immigration is particularly harmful i.e. workers who have been disproportionately represented by historically disadvantaged groups, including African Americans and other minorities, those without a college degree, and Americans with disabilities. The objective stated in the Proclamation and the means of achieving such objective appears to be conflicting in the present situation as the Proclamation suspends entry of such professionals who have higher education college degrees and sufficient expertise in their respective field who are not in competition with the American workers that don’t possess a college degree at the moment. Also, it has been claimed by representatives of various technology related business stakeholders in the US such as- Google, Amazon, Tesla etc. that the prohibiting immigration of the professionals are more likely to affect the economic recovery of US instead of improving it.
The objective of Proclamation to protect the unemployed American workers doesn’t get fulfilled by suspending the visas of professionals who are on the contrary, helping the country in its economic recovery. As the Proclamation fails to fulfil all the elements of necessity test, it is not relevant to analyse its compliance with the chapeau.
The US has not mentioned anywhere in its SoC regarding abruptly suspending the visas through domestic laws/regulations. Nor the Proclamation fulfils the conditions of Article XIV to take recourse of general exception clause for such discriminatory measure. The impact of coronavirus on the economy is felt by every nation and citing pandemic as a reason for introducing such GATS-inconsistent Proclamation to protect the interest of its unemployed workers is not justified.
Views are personal