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Trade Impediments Holding Back Landlocked Countries -Legal Avenues for Redress

A Case Study of Mongolia

Clinic: Graduate Institute, Fall 2020

Beneficiary: Permanent Mission of Mongolia

Executive Summary

Read the full report here

This memorandum aims at identifying trade obstacles encountered by landlocked countries generally and Mongolia specifically, and offering legal solutions to address these problems.

Apropos trade obstacles, this memorandum identifies the four clusters of obstacles experienced by landlocked states as follows: a) problems relating to ensuring access to the sea; b) the reduction of trade transaction and transport costs; c) the development of transit transport infrastructure and d) ensuring trade diversification and commodity dependence. In relation to Mongolia, it focuses on three sectors of Mongolian exports – meat products, cashmere and coal and ascertains specific barriers being experienced by Mongolia. These barriers range from unauthorized fee increases to trade restrictive measures (potentially) disguised as environmental regulations.

Apropos legal solutions, this memorandum considers both existing legal options and prospective changes to the legal framework which would be to the advantage of landlocked developing states. In relation to the existing legal options, remedies under trade law and the law of the sea are identified which can be used to challenge restrictions being experienced by exports. These involve private sector requests for further transparency, general council/committee meetings at the WTO, requests for consultations with the option of litigation and ITLOS mechanisms aimed at facilitating a friendly settlement.

In relation to changes to the legal framework, a comparative analysis of agreements governing access to the sea concluded by states other than Mongolia is undertaken. This analysis throws up a range of legal clauses that landlocked countries can seek to incorporate in their existing or future treaty arrangements. Inter alia, these include provisions relating to fair treatment in ports, the specification of transit routes, frontier formalities, mutual recognition of licenses and qualifications and dispute settlement provisions. Lastly, certain multilateral instruments which Mongolia might benefit from acceding to are identified, along with mechanisms which can allow Mongolia to collate further information about best practices in relation to specifically requested sectors.

Read the full report here.