Ex Ore Tuo Te Iudico: The Value of the WTO Ministerial Decision on Preferential RoO for LDCs

Abstract

This article discusses one of the outcome of the Bali package for the Least Developed Countries (LDCs), namely the Decision on preferential rules of origin (RoO) for LDCs, the prior proposals and discussions as well as its aftermath and prospects. Preferential RoO are a no man’s land in the multilateral trading system that has so far failed to regulate this important customs law, differently from customs valuation and customs classification. This is one reason why the ink of the Decision on preferential RoO for LDCs (The Decision) was not even dry when practitioners and commentators started to wonder about the value of the Decision. Most observers looked at the ‘big picture’ and rapidly relegated the value of the Decision to the realm of the ‘best endeavours scenario’. This is certainly true since the legal nature of the Decision and its wording do not provide clear guidelines or obligations. However, the real value of the Decision has to be contrasted with the existing background of multilateral disciplines and practices on preferential RoO. This paper argues that when measured against such background, the true value of the Decision may be reviewed under a new light, especially taking into account the possible work that could be carried out in the context of the Decision. In fact, the Decision contains a number of novelties and guidelines on drafting RoO. This holds especially true when the content of the Decision is contrasted with the annexes dealing with RoO contained in Kyoto Conventions of 1974 and 1999, and the ‘Common Declaration with regard to preferential rules of origin’ of the WTO Agreement on Rules of Origin (ARO).The Decision contains a number of interesting recommendations, albeit with a series of limitations, and sets preferential RoO for LDCs as an agenda item of the Committee on Rules of Origin (CRO). Much of the Decision’s value will thus depend on the will and the ability of WTO members, especially of the preference giving countries and LDCs, to build up a meaningful way forward in the context of the CRO to make further progress on suitable RoO for LDC that could benefit the multilateral trading system as a whole in the field of preferential RoO.