The Role of Precedent and Stare Decisis in the World Trade Organization's Dispute Settlement Body

Abstract

AbstractThe World Trade Organization was established in 1995 and brought together countries from around the world for the purpose of fairly regulating the trade of goods, services, and intellectual property between its member states. While treaties and other trade agreements have existed between countries for hundreds of years, the WTO's most significant innovation is its dispute settlement process through the Dispute Settlement Body. Countries agree to be bound to the decisions of the DSB upon their admittance into the WTO. The DSB is a two-tiered adjudicative system consisting of the lower panels and the higher Appellate Body.The United States, under both the Obama and Trump administrations, has blocked the appointment of AB judges. This tactic has limited the number of active judges to three. The AB normally has seven members. The United States has listed a number of reasons for their boycott of the system, among them is that the AB is functioning as if its reports are to be binding precedent on the lower panel and to future DSB cases, in a manner similar to stare decisis. This issue has been observed over the years and there is conflict between interpretations of precedent under Article 3:2 of the Dispute Settlement Understanding and Article IX:2 of the WTO Agreement. Caselaw of the DSB from over the years has also raised interesting questions and the appearance of the use of precedent.This article will be examining the historical fundamentals and use of precedent and the doctrine of stare decisis. It will then turn into an examination of the institutional and regulatory framework of the WTO, particularly Article 3:2 of the DSU and Article IX:2 of the WTO Agreement, and whether it allows or leaves room for a system of binding precedent. Finally, jurisprudence of the DSB will be surveyed for evidence of this system. Reports that will be examined are Japan-Alcoholic Beverages, India-Patents, India-Autos, and Australia-Plain Packaging Tobacco.