On the intervening night of June 15 and June 16, 2020, the People’s Republic of China (‘China’) and the Republic of India (‘India’) got engulfed into a military standoff at the disputed Galawan Valley along the Line of Actual Control (‘LAC’) which resulted in the death of twenty Indian soldiers. While the border skirmishes did, in fact, disproportionately affect the military relations between India and China, they also signified the possible indefinite suspension of seventy years of bilateral relations between the two countries.
Subsequently, from 29 June 2020 onwards, the Indian Ministry of Information Technology, invoking its power under §69A of the Information Technology Act read with the relevant provisions of the Information Technology (Procedure and Safeguards for Blocking of Access of Information by Public) Rules 2009 started the process of banning over 200 mobile applications in India, which were predominantly of a Chinese origin. The timing of the ban unequivocally suggests that the measure was a response to the Indo-China border face-off which occurred at the Galwan valley a fortnight before. However, it is interesting to note that, the order of 29 June 2020 and all subsequent orders, instead assailed the privacy and data security concerns which the applications brought with themselves before concluding that they posed a threat to the sovereignty and integrity of India.
While the legality of such an action by India under various International Treaties and instruments has been discussed elsewhere, the nature of such a measure under Public International Law, per se remains unarticulated to date. Against this backdrop, the scope of the present piece is limited to analyzing whether India’s actions may be labelled as an Economic Sanction under International Law, and what consequences such labeling brings with itself.
The Undefined criteria of the label ‘Economic Sanctions’
Although the label ‘Economic Sanction’ has been widely used by Scholars, its scope and definition remain vague and un-codified under any international legislation to date. This is to say, that there exist no universal criteria to label acts of States as ‘Economic Sanctions’ under International Law. An objective and universal criterion underpinning ‘Economic Sanctions’ can play a pivotal role in determining the subsequent legality of the measures so undertaken. The absence of a universally defined criterion is essentially due to the reluctance of States and International Organisations to define the label ‘Economic Sanctions’ under International Law. This is illustrated below.
A. The reluctance of the UNSC and the ICJ in defining economic sanctions
The Security Council (‘UNSC’) can authorise Economic Sanctions as part of its powers under Article 41 of the United Nations Charter. However, it is pertinent to note here that, even though the UNSC has exercised these powers numerous times, none of the UNSC resolutions actually use the label ‘Economic Sanctions’. This pattern has also been observed with respect to the legislation of the United States which has been enacted for taking economic sanctions against various target States. Moreover, it is rather unfortunate that the case of ‘Alleged Violations of the 1955 Treaty of Amity, Economic Relations, and Consular Rights’ (Islamic Republic of Iran v. United States of America) remains the only ICJ case to have even considered using the label of economic sanctions for the coercive actions of States under International Law. However, neither did the Court define the term nor did it lay down a criterion that could be used to determine the nature of the State’s actions as ‘Economic Sanctions’. The reluctance of the ICJ was apparent when it collectively referred to all the measures taken by the United States as ‘Sanctions’. These instances amply illustrate the reluctance of various international bodies to define Economic Sanctions, a label which though widely used by scholars, remains undefined under International law to date.
B. Deriving the definition from secondary sources
Notwithstanding the reluctance of the international bodies, it may be possible to identify the common nature of the acts which may qualify as ‘Economic Sanctions’ through various secondary sources. This will consequently help in deriving a generally accepted definition of the label ‘Economic Sanctions’ which, will in turn lay down a universal criterion that can be used to label the acts of States which adopt such measures.
The UNSC prepares a repertoire for all its chapter VII measures. This repertoire includes resolutions taken under Article 41 of the Charter, which gives the UNSC the power to take economic measures. Even though the UNSC Resolutions do not explicitly refer to the specific acts of States mentioned therein as ‘Economic sanctions’, the repertoire, which consolidates these resolutions, has on multiple occasions recorded the actions under the UNSC Resolutions as ‘Economic Sanctions’. Similarly, even though the US legislation that imposes such sanctions does not use the term ‘Economic Sanctions’ explicitly, a US Trade Commission report has explicitly referred to the acts under these legislations as ‘Economic Sanctions’.
Interpreting the common nature of all such actions under US legislation and the UNSC Resolutions, along with the State Practice of various States, we can identify a uniform criterion which is generally accepted by States and which must be fulfilled to label an act of a State as an ‘Economic Sanction’. First, the measure taken by one State should be targeted at another State. Second, the measure should be coercive in nature and applied intentionally. Third, the coercive measure so taken should be aimed at creating economic pressure and other foreseeable adverse economic consequences, which would ultimately force the receiver state to change its policies, economic or noneconomic.
C. Does the intention of the state issuing the sanction matter?
From a perusal of the above criteria, it becomes sufficiently clear that the purpose of an economic sanction has demonstrably been to induce a change in the policies of the receiver state to ensure compliance with its international obligations, or to show displeasure of the State issuing the sanction towards the target State’s policies or, in certain cases, even as a punitive measure.
A pertinent issue which arises in labelling acts of specific nature as ‘Economic Sanctions’ in accordance with the above criteria is an inherent overlap that occurs between measures that States take which are of an economic nature and those measures which may not be of an economic nature but are aimed at causing economic distress to the target State. In our opinion, this overlap may be remedied if the intention of the State issuing the sanction is taken into account.
In other words, if the intention of the State issuing the sanction is to induce a policy change in the target State by creating economic pressure, the act, notwithstanding its economic or noneconomic nature, would constitute an Economic Sanction. The intention in such scenarios may be judged by the circumstances in which such an action has been undertaken by a State.
Do India´s measures qualify as an economic sanction?
Against the backdrop of the criteria articulated in Part II, India’s actions may qualify as an ‘Economic Sanction’ under International Law. The intention of the State issuing the sanction is evident as the measures were taken after repeated warnings by India to China of the ‘consequences’ of noncooperation. The intention is also manifested by the fact that the banned applications are predominantly of Chinese origin. This amply illustrates that the measure has been targeted towards China to ensure that it complies with its international obligations and changes its foreign policy with respect to the Galwan valley. Although the applications have been banned citing privacy and National Security concerns, the timing of the ban coupled with its potential long-term impacts on the Chinese economy, by proving to be a model for other countries, is unequivocally indicative of India’s intentions. Thus, the surrounding circumstances establish a direct causal link between the ban and an intention to cause economic duress to the Chinese economy.
Economic Sanctions have been generally presumed to be illegal and in need of justification through the use of secondary rules of international law. Thus, assuming that the definitive criteria mentioned above, in fact, underpin the label ‘Economic Sanctions’, the legal burden to be discharged by India would still be relatively heavier. This is because such measures pose serious challenges to the efforts of the international community to establish an equitable multilateral, non-discriminatory, rule-based trading system and challenge the very basis of the primacy of international law, violate the principles of non-intervention, cooperation and disproportionately impact vulnerable populations. This has been confirmed by further decisions and State Practice. Additionally, since there does not exist any definitive criterion to label the acts which qualify as Economic Sanctions, the justification offered by the States for such acts is subject to the individual perception of target States, which makes it a heavy burden to discharge.
Thus, while India’s actions may potentially be labelled as Economic Sanctions under international law, whether India is able to discharge the heavy burden of their legality under international law or not, still remains to be seen.
Dhruv Gupta and Tanishk Goyal are undergraduates at The West Bengal National University of Juridical Sciences, Kolkata, India, interested in Public International Law. They would like to thank Adrija Ghosh for her invaluable inputs on the previous drafts of this piece.