From Confrontation To Coexistence: An Appeal Opt-Out Arrangement As An Inclusive Approach To Revive The WTO Dispute Settlement System?

Abstract

Resolving the crisis in the dispute settlement system is a priority issue for the reform of the World Trade Organization (WTO), and Members have made sustained efforts in this regard. Since the Twelfth Ministerial Conference (MC12), discussions on the dispute settlement system have entered a new phase, focusing on facilitator-organized meetings and proposals from Members. The reform negotiations have made some progress, but still face a number of significant challenges, in particular with regard to the appellate procedures. It is highly uncertain whether a comprehensive solution can be reached by 2024 as mandated by the MC12. Taking into account the different positions of Members and the imminent approach of the Thirteenth Ministerial Conference (MC13), this paper recommends that Members show more pragmatism and flexibility, puts forward a compromise proposal to establish a multilateral arrangement that would allow Members to opt out of the appellate review process under the Understanding on Rules and Procedures Governing the Settlement of Disputes ( DSU), and argues that this could be conducive to restoring a fully and well-functioning dispute settlement system. WTO, Appellate Body Crisis, Dispute Settlement Reform, Opt-out Arrangement