Appellate Body Research Articles

International court curbing in Geneva: Lessons from the paralysis of the WTO Appellate Body

AbstractThe 21st century has witnessed a backlash against many international courts (ICs). Studies of IC backlash have generally taken an optimistic tack, noting that most courts have survived backlash intact or—in the case of the paralyzed Appellate Body (AB) of the World Trade Organization (WTO)—are likely to do so after a temporary period of slumber. In this context, this paper analyzes the United States' successful effort to paralyze the AB, deriving lessons from this deviant case of backlash against one of the world's most active and independent ICs. Undertaken in the context of the “Reversing Delegation” research project, this account is organized in five parts. First, I demonstrate that the creation of the AB was a classic instance of delegation of dispute‐settlement power, and that the AB quickly emerged as an active agent of trade liberalization. Second, I explore the roots of politicization, noting that dissatisfaction with AB jurisprudence preceded the Trump administration, although Trump's delegitimation of the AB was more far‐reaching than that of his predecessors. Third, I examine the administration's use of the veto power to paralyze the AB, an act of de facto de‐delegation. Fourth, I assess the pushback from the many other WTO members that sought to defend the AB, showing how they failed to blunt the US campaign. Fifth, I analyze the remarkably successful outcome of the US attack, and draw lessons for judicial independence and the rule of law in international politics.

You're Fired! International Courts, Re-contracting, and the WTO Appellate Body during the Trump Presidency.

A long‐standing debate amongst international relations scholars has surrounded the question of whether international institutions with judicial authority enjoy more autonomy and discretion than other global institutions. This is mainly because international courts are established as impartial third‐party actors tasked with performing adjudicative functions for conflicting parties. As such, the delegation contracts of international institutions with judicial authority are expected to minimize control by states, even in cases where the members of a court engage in judicial overreach. This article contributes to that debate by examining the case of the crisis of the WTO Appellate Body. The article analyzes the Trump administration's successful efforts at rendering dysfunctional one of the most powerful courts in the international system. The findings showcase how powerful states are capable and willing to take advantage of the available control mechanisms and the institutional opportunity structures inherent in the design of international courts. The article speaks to the scholarship on the contestation of international institutions. The analysis relies on original data obtained through 22 interviews with WTO officials, state representatives, and experts.

Alternative Dispute Settlement and the Jurisprudential Legacy of the World Trade Organization’s Appellate Body

This article analyses the possible impact of the disputes advanced through the Multiparty Interim Appeal Arbitration Arrangement (‘MPIA’) and preferential trade agreements (‘PTAs’) on the jurisprudential legacy of the Appellate Body (‘AB’) and shows that those alternative dispute settlement mechanisms can play a significant role in preserving and further developing World Trade Organization’s (‘WTO’) case law. In the future, the importance of alternative dispute settlement mechanisms resolving arguments of international trade law is bound to increase (especially, in light of the ongoing deadlock at the WTO). That said, this does not come without risks for the (much disputed) coherence of WTO precedence by way of departure from established interpretations of the WTO acquis. Ultimately, it is the quality of the alternative dispute settlement awards that will determine the extent to which the jurisprudential legacy of the AB will be maintained. This article demonstrates that alternative dispute settlement mechanisms pose both challenges and opportunities for the consistency of the WTO case law. This article sheds further light on the potential risks and virtues pertaining to each one of them and argues that until the functioning of the Appellate Body is restored, alternative dispute adjudicating bodies must observe its jurisprudential legacy to promote legal certainty and predictability in international trade dispute settlement. WTO Dispute Settlement, Alternative Dispute Settlement, Appellate Body, Multiparty Interim Appeal Arbitration Arrangement, Preferential Trade Agreements

Silence in WTO

The World Trade Organization’s expansion in terms of its activities is becoming increasingly demanding for Members. Members may not express their acceptance or rejection to every statement or action taking place in the WTO, and they may remain silent to intentionally signify their position. This article examines the legal significance of Members’ silence in the WTO, in particular in the consensus-based decision-making procedures, in committees and council meetings, in the determination of subsequent practice when interpreting WTO provisions, schedules and practices, and in the assessment of whether or not a WTO Member has relinquished its right to initiate WTO dispute settlement proceedings. A brief description of the state of play of silence in public international law serves as a reference point to guide the analysis of silence in WTO law, which highlights the fact-specific nature of silence in both fields. While this article reveals that silence plays a role in the consensus decision-making function of the WTO, whether silence can amount to acquiescence in the context of councils and committees meetings remains unclear. Similarly, the Appellate Body has left the door open to the possibility that Members’ silence may provide evidence of subsequent practice for purposes of treaty interpretation. Contrary to international law where it has been suggested that silence may lead to a waiver of a state’s right to invoke the responsibility of another State, a relinquishment of a WTO Member’s right to initiate WTO dispute settlement proceedings must be formulated in clear and unambiguous language. WTO, silence, protest, acceptance, relinquishment of rights, practice, decision-making, interpretation, subsequent practice

The WTO Appellate Body Crisis: Can the Crisis be Cured?

The Appellate Body has played a major role in the dispute settlement system at the WTO. The future of it, and as a result, the future of the dispute settlement system remains unknown. That is due to the fact that the USA has been consistently blocking new appointments of the prospective members to the Appellate Body. The USA has been alleging that its strategy consisted in expressing its dissatisfaction with certain alleged irregularities concerning the functioning of the appellate process and the members of the Appellate Body. There has been a lot of discussions on the possibilities to avert the crisis both temporarily, as well as to pursue fundamental changes to the current dispute settlement system in order to address certain concerns that were raised since the beginning of the functioning of the Appellate Body. This paper explores possible scenarios of the cure of the stalemate in the Appellate Body in the WTO dispute settlement system.

Blokada Apelacionog tela Svetske trgovinske organizacije i Privremeni žalbeni arbitražni aranžman (MPIA)

The World Trade Organization (WTO) dispute settlement system is organized in two stages. In the first instance, the existing dispute between the members is resolved by ad hoc panels. In case the parties are dissatisfied with the panel's report, the dispute is finally resolved by the second instance body - the Appellate Body (AB). Since 2017, the United States has repeatedly blocked the appointment of members of the Appellate Body, which has caused a progressive reduction in the number of members. As the mandate of two of the three remaining members ended on 10 December 2019, the highest institution in the WTO dispute resolution system has thus become de facto dysfunctional. The blockade of the Appellate Body has resulted in a crisis in the WTO dispute settlement mechanism, which ultimately implies that the disputes are not being definitively resolved. In order to remove the blockade of the Appellate Body and its consequences, some WTO members have established a complaint redress mechanism in accordance with Article 25 of the Agreement on Dispute Resolution Rules and Procedures (DSU). Article 25 of the DSU envisages the possibility of establishing arbitration for resolving disputes at the multilateral level. This provision serves as a basis for establishing an arbitration mechanism that would act as an alternative to the Appellate Body while it is under blockade. On 30 April 2020, after intensive debates on how to implement this idea, the Multi-party Interim Appeal Arrangement (MPIA) came into force. The MPIA arrangement offers a short-term solution to overcome the problem of blocking the Appellate Body, while members try to find a more permanent solution. This article examines the role that the newly established MPIA would play in the future of the WTO, as well as the procedural innovations it has introduced, which can serve as a trigger for systematic changes in resolving disputes in front of the WTO.

With no deterrent effect, the WTO dispute settlement crisis leaves US exporters exposed, especially US agriculture

The absence of a functioning Appellate Body at the World Trade Organization (WTO) leaves the dispute settlement mechanism weakened, and countries may be more likely to pursue their domestic policy goals in ways that restrict trade. Industries with relatively large export exposure like US agriculture will be particularly vulnerable in this new chaotic regime. The deterrent effect is more important than you think An integral part of the world trading system has been the WTO’s dispute settlement mechanism, which enables the WTO to enforce the rules the Members signed up for. Knowing you could get sued in the WTO for not following the rules tends to deter bad behavior. Citing need for reform, however, the US has blocked appointments to the body responsible for reviewing appeals and this has left the enforcement mechanism ineffective. Countries can still bring cases but there is no Appellate Body so the losing party can indefinitely delay the process by appealing the panel decision into a void, leaving the issue unsettled. The WTO is inherently a member driven organization and the dispute settlement function can be seen as a way for members to “check” each other on following the rules. When Members designed the Dispute Settlement Understanding, they were saying, “we commit to following the rules that we made for ourselves and if we don’t follow them, then we subject ourselves to retaliation.” Disputes inevitably arise from time to time, so having a place to sort things out before a trade war ensues is essential. The most important function of the dispute settlement mechanism might just be the deterrent effect—that is, policymakers and legislators are deterred from designing laws and policies that would violate the WTO rules. The deterrent effect has been hard to measure. Until now.

The WTO’s Collapsing Judicial and Legislative Wings: Is ‘Consensus’ the Real Elephant in the Room?

The World Trade Organization (WTO) has three main functions: (i) it provides a negotiation forum where Members can negotiate new agreements and understandings, (ii) it provides a judicial forum where trade disputes between countries can be settled, and (iii) it acts as an executive forum for the administration and application of the WTO agreements, including capacity-building and training in this respect. Currently, it is only performing its executive function, as the other two functions remain stalled. The authors in this article analyse two challenges that have contributed to paralysing the WTO’s legislative and judicial functions. With this assessment, the authors suggest that the ‘real elephant in the room’, i.e., the root-cause behind these challenges, is the avoidable ‘consensus-based decision-making’. World Trade Organization, National Security Exception, Appellate Body, Consensus, Decision-Making

Of False Conflicts and Real Challenges: Trade Agreements, Climate Clubs, and Border Adjustments

Assessments of the relationship between trade agreements and the climate regime often focus on the potential for normative conflict. Concerns that trade commitments may prevent the adoption of measures to curb climate change, or at least that these are two regimes that “point in different directions,”1 are often voiced to suggest that taking climate action requires fundamentally modifying, and maybe getting rid of, current trade agreements. In this essay, we argue that allegations of conflict disregard longstanding World Trade Organization (WTO) jurisprudence on policy-justified trade measures. As a matter of principle, this alleged conflict has been essentially overcome since the 1998 Appellate Body report in United States – Shrimp.2 Focusing on potential conflict distracts from the real challenges and dilemmas involved in designing and implementing a global carbon regime, including through the trade instruments known as carbon border adjustment mechanisms (CBAMs and so-called “climate clubs”), for which the legal parameters provided by trade agreements may be instrumental.

Position of Joe Biden's Administration towards the World Trade Organization

The election of Democratic Party candidate J. Biden to the post of the President of the United States did not lead to noticeable progress in relation to changing the vector of the generally negative attitude of official Washington in assessing the activities of the World Trade Organization. The historically established consensus of the Republican and Democratic parties, expressed in the general similarity of the approach of both the legislative and executive branches of government in the United States to the WTO as an instrument primarily for the realization of the national interests of the United States in the foreign economic sphere, hinders the achievement of generally acceptable agreements within this Organization in key areas of its activities. Like the previous administration of D. Trump, the administration of J. Biden has been blocking, in particular, for a number of years the activities of the WTO Appellate Body. Despite the Democratic President's statements about the US commitment to the principles of liberal trade, the White House, as before, proceeds from the desire to maintain the leading role of the United States in the WTO, even at the cost of curtailing certain areas of its work. The dominant drive is to transform the WTO into an international economic mechanism to strategically contain China, openly oppose Russia by politicizing the Organization and taking steps that pave the way for the complete dismantling of the rules-based multilateral trading system. The WTO is actually in a state of permanent institutional crisis in a number of central areas of its activity. The only way to deal with the current crisis is the prerogative of economics, not politics, the need to prevent the violation of agreed multilateral trade rules by unilateral actions, which otherwise will continue to have a negative impact on world markets and the economies of many WTO members.

Stress Test for EU’s Investment Court System: How Will Investments Be Protected in the Comprehensive Agreement on Investment?

On 30 December 2020, the European Union (EU) and China agreed in principle to a revamped investment treaty: The Comprehensive Agreement on Investment (CAI). Notably, the EU and China have not decided which investment dispute resolution system will be included under the new agreement. Instead, the EU and China are continuing negotiations on this contentious topic. This article discusses the key features of the proposed investment court system in the context of the CAI negotiations to assess whether China could agree on such a paradigmatic change that would have systemic consequences. The article explains the objective reasons behind China’s partial support for the proposed reforms to the existing investor-state arbitration system. For example, China has supported adding an appellate body without accepting the EU’s full-fledged investment court proposal. Finally, the article identifies the points of convergence and divergence which will shape the CAI negotiations and pave the way to global investor-state dispute settlement (ISDS) reform. comprehensive agreement on investment (CAI), investor-state dispute settlement (ISDS), investment court system (ICS), United Nations Commission on International Trade Law (UNCITRAL Working Group III), Comprehensive Economic and Trade Agreement (CETA), EUVietnam Free Trade Agreement (EVFTA), State-to-state dispute resolution, Achmea case, financial responsibility regulation, European Commission

Exceptions to compliance clauses in international economic law from an ecocentric approach and from the global south

This article intends to carry out an analysis that concerns the dynamics whit which International Economic Law, based on some provisions contained in its own regime, intends to exclude obligations that have been interpreted from other perspectives and that have been interpreted from other perspectives and that, over time, have gained prominence in international law discussion forums. The specific cases are limited to those settled in the WTO Dispute Settlement Body and the ICSID Appellate Body, all in relation to the interpretation generated in other systems from an alternative perspective and that may have a final impact for Europe, to finally seek a precedent-setting relationship such as the ICJ Whaling Convention (Australia v. Japan). It will seek to define from the CILT, the spirit whit which the exceptions contained in Article XX of the GATT emerged., which allows us to see an approach to the ecocentric approach that prevails today in a part of the world and that will soon be the dominant paradigm.

Nomination of candidates to international judicial and legal bodies: a critical examination of Indian practice*

When and how India nominates individuals to international judicial and legal bodies has not attracted much attention in international legal scholarship. This article aims to fill that gap by critically examining India’s nominations to international judicial and legal bodies, including the International Court of Justice, International Law Commission, Appellate Body of the World Trade Organization, and the International Tribunal for the Law of the Sea. The article finds that India has consistently nominated serving and retired government officials and judges to these international bodies. Expertise in international law that lies outside the echelons of executive and judicial power, such as in universities, has been persistently ignored and disregarded in making these nominations. This practice has resulted in situations where several capable international lawyers from academia, who are arguably better suited to serve on these international bodies, have never got an opportunity to do so. India’s practice differs from that of other liberal democracies such as the United States and the United Kingdom, which routinely nominate people with demonstrable academic expertise in international law to such bodies. The article also argues that India needs to establish a transparent procedure of nominations to these international bodies to boost the credibility of the process.

Consensus and Diversity in the World Trade Organization: A Queer Perspective

When the World Trade Organization (WTO) was established in 1995, it was seen as representative of a new era in international law, which claimed to be more functional and cooperative than the Cold War years. Fast forward to 2022, most commentators proclaim that the WTO is in “crisis.” For over two decades, its membership has struggled to reach decisions and, in 2019, the WTO was “dejudicialized” by the United States blocking consensus on appointments to the Appellate Body. In seeking to understand what went wrong, some commentators have focused on the operation of the WTO's consensus procedure and, in particular, the way it can afford states a veto power. In this essay, I take a different approach by considering how the discursive effects of consensus decision making have played into some of the problems facing the WTO today. Inspired by Gibson-Graham's work on “queering the economy,” I do so by unmooring queer theory from its base of gender and sexuality and applying queer insights to a discourse analysis of statements made in relation to the Uruguay Round of multilateral trade negotiations, which lasted from 1986 until 1993 and culminated in the agreement to establish the WTO. I show how the use of consensus decision making served to cultivate an intolerance of economic difference by giving rise to discourses of worldwide sameness and agreement. Finally, I consider what a queerer approach to trade-related decision making might look like.

A Critical Analysis on the Extent to Which the Appellate Body of the WTO Has Engaged in Judicial Activism

A Critical Analysis on the Extent to Which the Appellate Body of the WTO Has Engaged in Judicial Activism

The Role of the Registry and Legal Division of the African Court of Human and People's Rights in Dispute Settlement

This Essay explores whether the African Court of Human and People's Rights’ (African Court) Registry and Legal Division have a similar expansive role in the dispute settlement mechanism as the World Trade Organization's (WTO) Secretariat. The African Court is the African Union's regional body for enforcing human rights. This Essay contributes to the scholarship on African international courts by testing the central arguments in Pauwelyn and Pelc's “Who Guards the ‘Guardians of the System’? The Role of the Secretariat in WTO Dispute Settlement”1 through a comparative analysis of the role of the Secretariat within the African Court.2 Despite the growing jurisprudence and influence of Africa's international courts, they continue to be neglected by mainstream scholarship of international courts and tribunals. This is evident in Pauwelyn and Pelc's article, which does not refer to any of Africa's seven international courts and tribunals. For that matter, the article makes no reference to any international tribunal outside Europe or the United States.3 Our analysis illustrates the fact that the influence of the African Court's Registry and Legal Division (Registry) in the process for dispute settlement is not as significant and concerning as that of the WTO Secretariat. As such, the influence of the Registry on the outcome of a case is significantly limited and does not raise any legitimacy crisis like the WTO. We attribute this disparity to the operational and structural disparities between the African Court and the WTO. In the following paragraphs, we examine each of the factors that Pauwelyn and Pelc raise concerning the influence of the WTO staff in WTO panel and Appellate Body proceedings4 in the context of the functions of the African Court Registry.

Silence for “Silence”?—Reflections on the Interpretation of GATT III:8(a) in DS583

DS583, as the first arbitration with appealing nature under the WTO system, with no doubt made a huge step in seeking for the alternative method during the paralysis of Appellate body. Nevertheless, it never means the award is impeccable especially for treaty interpretation. The most controversial issue the tribunal confronted but failed to offer a convincing analysis is the entity of the purchase, which is silent in the treaty. Against this background, the article firstly revealed the deficiencies concerning treaty interpretation, including the vague application of VCLT and over-simplified deduction. The crux is how to interpret “silence” appropriately. The article suggests it is necessary to make reference to previous cases of WTO and extract the common methodology and technique to assist the interpretation. In this vein, to make some complement and correction, the article re-interprets the purview of the entities of “products purchased” and finally provides some suggestions for both DSB and disputing parties under Article 25 arbitration.

A Study on Likeness of Services and Service Suppliers under the GATS

WTO의 서비스무역 분쟁에서 피제소국과 제소국 간의 분쟁대상이 되는 서비스 및 서비스 공급자에 대한 동종성 판단 여부는 가장 핵심이 되는 이슈이다. 특히 그 분쟁이 GATS의 제2조(최혜국대우) 혹은 제17조(내국민대우)에 관한 사안일 경우 동종성 판단이 선행되지 않고서는 해당 분쟁을 자체를 논하거나 판결할 수가 없기 때문에 그 중요성은 매우 크다고 할 수 있다. 동종성 판단이 단순하지 않은 이유는 우선 GATS 협정문에 ‘동종’에 대한 명확한 정의가 내려져 있지 않기 때문이다. 나아가 상품과는 달리 서비스의 무형성 때문에 GATS의 서비스 및 서비스 공급자의 동종성에 관한 판단은 GATT의 동종 상품 판단에 비해 모호해질 수밖에 없고 이는 더욱 면밀하고 복잡한 분석 절차를 요구하게 된다. 한편 CPC는 각 회원국의 양허표상 서비스 분류에 대한 기준을 제시해주는 반면에 단순히 CPC 분류만으로는 해당 서비스의 동종성에 대한 직접적 판단이나 비약적인 결론을 내릴 수는 없다. 동종성 판단에 대한 법적인 기준은 그동안 다양한 GATS 분쟁을 통해 논의되어 왔으나 지금까지도 명확한 기준이 되는 리스트가 제시되지는 않은 상태이다. 따라서 본 연구를 통해 지금까지 GATS의 동종성이 이슈가 되었던 7개의 WTO 분쟁사례에 대한 패널 및 상소기구 보고서를 분석함으로써 동종성 판단에 대한 분쟁 당사국들의 주장과 논거를 살펴보고 각 분쟁에서 동종성 판결의 근거가 된 법리를 종합하여 향후 적용 가능한 기준을 도출해보도록 한다.A determination on “likeness” between domestic and foreign services and service suppliers is one of the most critical issues in disputes under the General Agreement on Trade in Services (GATS). Likeness under the GATS requires a complex analysis because the term “like” is not defined in the GATS text itself. In the meantime, the intangible nature of services and its four different modes of supply make it inappropriate to transpose the traditional like standards used under the GATT. While the “CPC” provides a list of services classification for the schedule of specific commitments for Members, the categories alone do not fully solve the question of likeness. Therefore, this article seeks to discuss seven GATS dispute cases where the likeness of services and service suppliers was analyzed and determined and provide some level of a general rule for likeness determination extrapolated based on the reasoning of the panel and Appellate Body in these disputes.

Comments on United States – investigation of the International Trade Commission in softwood lumber from Canada, recourse to article 21.5 of the DSU by Canada

This article is based on United States – investigation of the International Trade Commission in softwood lumber from Canada, recourse to article 21.5 of the DSU by Canada（WT/DS277/AB/RW）panel and Based on the report of the Appellate Body, it analyzed the case and proposed to amend the Anti-dumping Agreement and improve domestic laws to reduce anti-dumping disputes.

A fuzzy look at a fuzzy agreement: Risk management under the WTO SPS Agreement

Risk management does not appear explicitly in the SPS Agreement. Support for it appears in the Agreement nonetheless. The Appellate Body has acknowledged that the Agreement does not draw a distinction between assessment and management. Our focus is the assessment and management of risk through interpretation of the expression of the SPS Agreement.The Agreement imposes disciplines on measures implemented for protection of human, animal or plant life and health through the subjectivity of standards. This invites discretionary interpretation and application of policy, particularly with regard to assessment, necessary, and sufficient.Fuzzy logic, rooted in subjectivity and possibility, is particularly suited for analyzing and interpreting standards. It is applied to two manifestations of ambiguity in assessing hazards. One is the level of a risk posing a danger when its level is precisely measured. The other is imprecision in measurement when the level of the hazard that poses a danger is known.Failure to guide interpretation of risk plausibly contributes to disputes over policy. The discussion undertaken by this paper introduces a new means for exporting and importing WTO Members to frame their arguments to one another.