The Procedural Inconsistency of the Envisaged EU Enforcement Regulation With the EU’s WTO Obligations

Abstract

With the appellate function came to a halt, the WTO is unlikely an attractive venue to settle international trade disputes at the moment or in the near future. To overcome such impasse, the European Union has come up with two initiatives to discharge of its right to enforce international trade rules. Multilaterally, the EU led an establishment of a multi-party interim appeal arbitration arrangement (‘MPIA’) to set up an arbitration mechanism based on Article 25 Dispute Settlement Understanding (‘DSU’) – that mirrors the main features of the WTO Appellate Body (‘AB’) system, to solve trade disputes with other participants of the Agreement (so far, the MPIA has attracted 21 participants, including the EU). At the EU level, the European Commission (‘the Commission’) has made the Proposal to amend Regulation (EU) No. 654/2014 (‘EU Enforcement Regulation’) concerning the exercise of the EU's rights for the application and enforcement of international trade rules (‘the Proposal’) so as ‘to protect its trade interests despite the paralysis of the multilateral dispute settlement system in the World Trade Organization (WTO).’ This contribution will analyse the Proposal and will argue that, under WTO jurisprudence, the proposal if adopted might be incompatible with EU’s procedural obligations under the Dispute Settlement Understanding of the WTO (‘DSU’).