As Section 301 evolved, foreign government opposition to its use grew. United States trading partners perceive Section 301 as United States hypocrisy at its worse: the United States pursues multilateral options when they serve United States interests, but then reverts to 'aggressive' unilateralism whenever doing so better serves its interests. The EU and Japan have both been particularly vocal critics of Section 301, but so have developing countries.

This foreign criticism intensified after the Uruguay Round. Many United States trading partners believe that Article 23 of the DSU and Article XVI of the Marrakesh Agreement prohibit the use of Section 301. The United States does not share this view, and believes that the amendments made in 1994 brought Section 301 into compliance with WTO obligations. WTO may impose a penalty on the United States as the price for using Section 301, but the United States still retains that option.

A recent WTO panel largely resolved this debate. The panel found that Section 301 does not violate WTO obligations on its face, but would violate WTO obligations if sanctions were ever imposed before all formalities under the DSU had been completed. The panel decision provided a clear and unambiguous advisory opinion about how it would have judged any United States use of Section 301 sanctions. This decision was not appealed to the Appellate Body, however, so we do not yet have the final word on this issue.

Source: Business Guide to Trade Remedies in the United States: Anti-dumping, countervailing and safeguards legislation practices and procedures