The White House Trade Representative (USTR) has called for an end to the MFN principle of the World Trade Organization (WTO).

This principle establishes that any trade advantage granted to one country must be immediately extended to all members, guaranteeing non-discriminatory treatment, trade, and a multilateral system based on clear common rules, except when free trade agreements are signed.

End to the MFN principle

The USTR made this proposal in a communication addressed to the WTO General Council in December 2025.

The Most-Favored-Nation principle seeks to prevent discriminatory trade practices and ensure equal treatment. It was conceived at a time of convergence among trading partners, when it was assumed that Members would adopt open, market-oriented policies.

But for the USTR, that expectation, enshrined in the Marrakesh Declaration, proved naive. That era is now behind us. According to this agency, it has been replaced by an era of growing divergence, marked by the reluctance of some countries to engage in fair, market-oriented competition.

In addition, economic systems incompatible with WTO principles persist. Added to this is the pursuit of chronic trade surpluses. The USTR emphasized that these practices generate adverse economic and political consequences for countries with trade deficits.

Trade agreements

In light of these challenges, the USTR stated that the MFN principle is considered inadequate. It even asserted that it limits countries’ ability to optimize specific trade relationships, prevents liberalization that promotes welfare, and forces all Members to negotiate a one-size-fits-all approach.

In practice, if two countries reduce tariffs between themselves, they must extend that benefit to all. With some exceptions, in the USTR’s view, this discourages mutually beneficial agreements. 

WTO Members have a long history—dating back to the GATT era—of recognizing the limits of the MFN principle. The “Enabling Clause” eliminated the MFN principle for Members claiming developing country status. 

“In particular, given that the distinction between developed and developing status is now blurred, it is time to recognize the need to allow all Members to enter into mutually beneficial agreements that may not extend to all Members,” the WTO said.