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Most-Favoured Nation Treatment

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Chapter Summary

The principle of most-favoured nation (MFN) treatment belongs to the cornerstones of the development and liberalization efforts of the General Agreement on Tariffs and Trade (GATT). Together with the principle of national treatment, most-favoured nation treatment serves to prevent discriminatory action and the reduction of trade barriers as well as to open the Members' internal markets. Most-favoured nation treatment aims at reducing trade discrimination between the Members of the World Trade Organization (WTO). In US, Section 221 Appropriations Act, the Appellate Body for the first time found a violation of the MFN principle. It reversed the Panel's conclusions that Sections 211(a)(2) and 211(b) of the US Omnibus Appropriations Act of 1998 did not deny Cuban nationals any advantage, favour, privilege or immunity that they accord to other foreign nationals.

Keywords: GATT; most-favoured nation (MFN) treatment; US Omnibus Appropriations Act; World Trade Organization (WTO)



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