The right to regulate and the interpretation of the WTO Agreement

Abstract

ABSTRACT In contrast to international investment tribunals, World Trade Organization (WTO) adjudicators have been reluctant to acknowledge the inherent right to regulate under international law explicitly. Policy-based considerations arising from such a right have not been viewed as a standalone component under interpretive analyses in WTO dispute settlement. Instead, they have been integrated only to the extent they find expression in the treaty. This article explores how, on occasion, WTO adjudicators have departed from this orthodox approach by choosing to proactively interpret the WTO Covered Agreements in a way that presupposes a States’ right to regulate, even where this may seem contrary to, or unsupported by, the treaty text. In these cases, the question has not been whether such a right subsists within substantive WTO disciplines, but rather how such a right can be read into these disciplines in a manner that comports with the ordinary rules of treaty interpretation. While this unorthodox approach has resulted in interpretations that appear unclear and uncertain, these outcomes are ultimately explicable in terms of a general principle of regulatory autonomy that can form the basis for more principled interpretive choices.