Escape Clause

A provision in a bilateral or multilateral commercial agreement permitting a signatory nation to suspend tariff or other concessions (temporarily violate their obligations) when imports threaten serious harm to the producers of competitive domestic goods.


Section 201 of the U.S. Trade Act of 1974 requires the U.S. International Trade Commission to investigate complaints formally known as “petitions” filed by domestic industries or workers claiming that they have been injured or are threatened with injury as a consequence of rapidly rising imports, and to complete any such investigation within six months.

Section 203 of the Act provides that if the Commission finds that a domestic industry has been seriously injured or threatened with serious injury, it may recommend that the president grant relief to the industry in the form of adjustment assistance or temporary import restrictions in the form of tariffs, quotas, or tariff quotas.

The president must then take action pursuant to the Commission’s recommendations within 60 days, but he may accept, modify or reject them, according to his assessment of the national interest.

The Congress can, through majority vote in both the Senate and the House of Representatives within 90 legislative days, override a presidential decision not to implement the Commission’s recommendations. The law permits the president to impose import restrictions for an initial period of five years and to extend them for a maximum additional period of three years.

See adjustment assistance.

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