Multilateral Obligations Research Articles

THE WTO DISPUTE SETTLEMENT SYSTEM IN 2020: FACING THE APPELLATE BODY PARALYSIS

The COVID-19 economic and trade crisis, which started in early 2020, hit the WTO at a moment in which the organization was certainly not in good health. The respect of its rules has reached a low level, due to recourse to unilateral restrictive measures of dubious legality (to say the least) and to bilateral agreements in disregard of multilateral obligations. The dispute settlement system has been, and remains half paralyzed due to the demise of the Appellate Body (AB) since the end of 2019. That said, the Appellate Body has finished its work on certain pending cases and adopted three reports. This contribution therefore covers the above-mentioned three appellate reports and two panel reports of special interest: the Saudi Arabia-Intellectual Property and the US-Tariff Measures on Chinese goods.

Economic Nationalism: US Trade Policy VS. BREXIT

In 2016, both the election of President Trump and the UK’s vote to leave the European Union represented important shifts in the approach of both countries to their international trading relationships. In the case of the US, the Trump administration has sought to target tariffs against countries such as China, while the UK is seeking to exit a highly integrated market and assert its sovereignty. In this article, it is shown that both events were a response to the China import shock, which in turn led to a dramatic rise in populism resulting in a substantive shift in each country’s trade policy, each generating substantive actual and expected economic costs. However, the policy responses to populism are quite different: the US has chosen to be explicitly protectionist, a feature of economic nationalism, while the UK is not seeking to raise trade barriers as it adjusts its trading arrangements. Nonetheless, both countries are following a path of economic “dis-integration”, the US undermining its multilateral obligations under the WTO, the UK seeking to leave the European Union of which it has been a member since 1973.

Facets of Trade Facilitation

The theoretical underpinnings of trade facilitation (TF) would suggest a ‘balanced growth’ approach to expedite trade. However, taking the example of China and India, in this article, we explore how selective measures are capable of addressing issues related to TF. Both the economies offer very innovative interventions to address issues corresponding to TF, especially embedded in the way institutions are coordinated and integrated. As against the conventional idea that TF has to be initiated and carried forward only by the government, the ‘One Touch’ initiative in China provides a role for public–private partnership on issues pertaining to TF. This clearly demonstrates how, besides generating demand for trade-logistics services, the private sector itself can act as a source of supply to such services. The operation of Grapenet in India highlights the need to focus on sector-specific TF requirements along with meeting multilateral obligations. The One Touch initiative has to be appreciated as it was brought about in a context of the limited evolution of the information technology (IT) platform in China, and Grapenet has to be appreciated specifically because it brought a paperless integrated system in an agricultural context in India, where this sector’s preparedness for TF is less than that of the manufacturing sector.

Challenges Facing India's National Solar Energy Development: The Pitfalls of the National Solar Mission and Alternatives Available

In this paper, I argue that domestic content requirements should be removed from India’s Jawaharlal Nehru National Solar Mission (National Solar Mission or Mission) because such requirements are inconsistent with India’s multilateral obligations under the World Trade Organization (WTO). Subsidies that are contingent upon the use of domestic instead of foreign products are inconsistent with the WTO’s Agreement on Subsidies and Countervailing Measures (SCM Agreement) and the National Treatment obligation under Article III of the General Agreement on Tariffs and Trade (GATT) and Article 2 of the Agreement on Trade Related Investment Measures (TRIMs Agreement). The Government of India (or India) should seek alternative measures to promote the development of the country’s renewable energy industries.Governments have recently responded to the impact of climate change and global warming in various ways, from instituting domestic regulatory measures to entering into multilateral agreements with an aim to cut global emissions of greenhouse gases. One of the leading contributors to global warming is the burning of fossil fuels for energy consumption. Fossil fuels not only hurt the environment, they are also non-renewable. Eventually these fuel sources will be depleted. With this in mind, governments have actively attempted to develop renewable energy alternatives that have little to no impact on the environment.To accomplish these goals, many governments across the globe have implemented subsidy schemes to promote renewable energy development within their countries. Many of these subsidy schemes require renewable energy producers to use a certain amount of local resources and labor in order to qualify for the subsidy schemes. While these programs would have the intended effect of developing renewable energy industries within a country, the programs are susceptible to challenges under the WTO. This paper examines why the domestic content requirements of India’s National Solar Mission are inconsistent with India’s WTO obligations and suggests alternative measures available to India that are not susceptible to challenges at the WTO.

Gold Import: A Capital Account Acquisition? (Counter-View)

Gold import has been an issue of national debate in India. Economists opine that gold import is responsible for the bloating current account deficit (CAD). To check the widening current account deficit, United Progressive Alliance (UPA) government raised import duty on gold to 10 per cent from 2 per cent in stages. It also instructed all importers of gold to export 20 per cent of gold from every consignment of import. Gold import restrictions led to the CAD fell to 1.7 per cent of GDP of India. The next Bharatiya Janata Party (BJP) Government under Narendra Modi lifted the restriction on gold import. The jump in gold import widened the CAD. By December 2014, the CAD became 99 per cent of the annual estimate. But, the easing of gold import was supported by a few economists including Swaminathan S Ankalesaria Aiyer. Swaminathan termed gold import a ‘capital account acquisition’. He thought that gold import would work for inclusive growth for the ‘aam aadmi’ or the common man of India and proposed a change in the composition of capital account so as to accommodate gold in it. This article surveyed literature and compiled data on how gold import contributed to the CAD and fiscal (mis)management of India. It also tried to identify research gaps so that future fiscal management of the country could be studied comprehensibly in the presence of gold import. As India is bound by multilateral obligations, the paper tried to recommend necessary steps so that the country would not be put on defensive.

Economic, Financial and Geopolitical Governance: USA, European Union and China

The paper examines the policies, choices, structural reforms, regulatory rules, corporate and public administration matching the world standards, openness, innovation, competitiveness, fulfillment of multilateral obligations, integration and regional approach achievements and international relations conditionality in the “Global Governance and Geopolitics” of the main economic, financial and policy issues, with special focus on the new regional approaches pursued by America, the European Union and Asia and the role of the emerging and transition countries. After the US Dollar, now the Eurozone is under pressure and the main Asian countries fear a contagion effect. While somebody proposes a slow devaluation of the Euro in order to soften the public deficits of the group of most exposed countries and restore more competitiveness to the real economy, political leaders are thinking to adopt indirectly the Euro two speeds operative monetary strategy, through the introduction of the majority vote, instead of the full Members consensus, for the most important decisions at the ECB in Frankfurt. Aside these monetary and institutional measures, the binding of the single national fiscal policy to more strict EU parameters of compatibility with the Eurozone sustainability appear unavoidable. This paper represents the background of my lecture given on November 4 at the Beijing Forum 2011 “The Harmony of Civilizations and Prosperity for All: Tradition and Modernity, Transition and Transformation” (http://www.beijingforum.org/html/folder/172-0.htm) at the PEK University.

The Conformity of EU-ACP Trade Partnerships with Sustainable Development and Good Governance Norms or Do (I)EPAs Live Up to Their Standards?

Is trade cooperation between the European Union (EU) and the African-Caribbean-Pacific (ACP) countries an engine for sustainable growth?As the basis for individual bi- or multilateral (interim) Economic Partnership Agreements ((I)EPAs) of the EU with ACP countries, the current Cotonou Agreement advocates the globally acknowledged conditions and crucial policy norms for the pursuit of sustainable development. Therefore, one would expect that the (I)EPAs translate the sustainable development aims into precise legal provisions, i.e. that they create bi- or multilateral obligations and concrete commitments between the signatory states which support the achievement of the relevant MDGs and the consolidation of good governance practices. With that premise in mind, this legal Master thesis verifies whether the individual (I)EPAs live up to the standards set for the EU-ACP partnerships in the current Cotonou Agreement as foundation stone for the strategic implementation of sustainable development policies. In accordance with the revised text of the Agreement itself as well as in light of the development cooperation and trade for development objective of the (I)EPAs, its focus is limited to the policy norms of the most relevant Millenium Development Goals (MDGs), being poverty reduction (MDG#1), environmental sustainability (MDG#7) and global partnerships (MDG#8) as well as the sine qua non requirement of good governance practices.

Transit and Trade Barriers in South Asia: Multilateral Obligations and Development Perspective

With the South Asian Free Trade Agreement, South Asian countries are now looking towards deeper integration of the region. In reality, South Asia is far from realizing its full trade potential. One of the critical factors preventing South Asia from achieving its full potential is the absence of regional transit. Unlike the European Union, South Asian countries do not have a regional transit arrangement, although partial transit exists for landlocked countries such as Afghanistan, Bhutan and Nepal. This paper highlights, among others, the importance of transit as a major source of advantage for regional as well as international trade in South Asia.

The Changing Structure and Governance of Intellectual Property Enforcement

This research paper provides a broad overview and analysis of the changing multilateral framework for intellectual property enforcement and the challenges it presents for developing countries. It examines the current multilateral obligations and traces developments in the field of intellectual property enforcement in multilateral fora, including the World Customs Organization (WCO), the World Health Organization (WHO), the World Intellectual Property Organization (WIPO), the World Trade Organization (WTO) and Interpol. It analyses the approach of the United States and European Union to strengthening intellectual property enforcement in third countries through regional, bilateral and unilateral mechanisms such as regional and bilateral trade agreements. Finally, it provides policy recommendations for developing countries.

The Nature of Social Human Rights Treaties and Standard-Setting WTO Treaties: A Question of Hierarchy?

AbstractSocial human rights are not held to belong to the category of jus cogens norms. At the same time these human rights protect vital matters, such as the right to adequate food, which obviously has a relationship to the right to life. On the other hand, the annexes to the World Trade Organization (WTO) Agreement, which are binding on all WTO member States, has implied a shift from the old General Agreement on Trade and Tariffs (GATT) to the WTO, from pure contractual treaties to more standard-setting treaties. The article seeks to analyse if the obligations erga omnes and the concept of 'multilateral obligations' are applicable to distinguish between human rights treaties on the one hand and WTO agreements on the other. The background of the analysis is also the work of the International Law Commission (ILC) Study Group on fragmentation of international law, finalised in 2006. The article finds that there is still uncertainty regarding the exact meaning of the term 'multilateral obligations'. Hence, other concepts such as 'absolute obligations' might be preferred in order to characterise human rights treaties, and hence implicitly acknowledge that treaties that protect vital matters may prevail over other treaties, based on the interests which are to be protected.

The Fiscal Vulnerability of Public Social Expenditures: Is Latin America Different? (La Vulnerabilidad Fiscal Del Gasto Social: ¿Es Diferente América Latina?)

An unbalanced panel data of around fifty countries between 1985 and 2003 is used to estimate the vulnerability of public social expenditures (health and education) to other fiscal variables. The database allows comparisons between Latin America and the rest of developing countries. Public social expenditure is significantly lower in Latin America as share of GDP, although it has a higher share in primary expenditure. Public social expenditures in Latin America are more vulnerable to debt service, but are less sensible to changes in other types of public expenditure. As in other regions in the developing world, public social expenditure in Latin America shrinks when public debt stock increases. This effect is higher with multilateral debt obligations. In Latin America, debt defaults reduce the share of public social expenditures in total primary public expenditure.

The GCC and Gulf security

The states of the Gulf Cooperation Council (GCC) – which encompasses Saudi Arabia, Kuwait, Qatar, the UAE, Bahrain and Oman – face a new and more uncertain strategic environment. Under these circumstances, they might be expected to band together more tightly. This, however, is not yet the case. Kuwait, Qatar, UAE, Bahrain and Oman all maintain bilateral ties to the United States and privilege that relationship over their multilateral GCC obligations. Each country has sought the security of an external guarantor in the form of the United States, rather than in the enhancement of the collective capabilities of the GCC itself.

The Political Economy of Intellectual Property Protection: The Case of Software

The end of the twentieth century was marked by a sea change in global governance in the realm of intellectual property rights (IPRs). Whereas countries historically retained substantial autonomy with regard to what they defined as intellectual “property” and the rights granted to the owners of intellectual property, the 1990s witnessed the establishment of new global obligations regarding national practices. This paper focuses on the case of software “piracy” to assess the mechanisms by which the new global obligations for the treatment of IPRs are transmitted from the international to the national levels. We first consider a set of national-level factors that many scholars have shown to be important determinants of IPR policy. We then supplement the standard emphasis on domestic factors with an analysis of new transnational factors: countries' multilateral obligations under the World Trade Organization's (WTO) Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) and bilateral pressures from the United States to increase the protection of IPRs. Population-averaged panel data models are used to assess the effects of these national and transnational determinants on levels of software piracy in 80 countries from 1994 to 2002. Our results indicate that membership in the WTO and bilateral pressures from the United States—particularly pressures that offer reciprocal concessions—lead to substantial increases in levels of protection in rich and poor countries. There is, in short, a new international political economy of intellectual property.

Regionalism, Multilateralism, and Economic Integration: The Recent Experience

In recent years, the central question relating to regional trade agreements has been whether or not they have led to a new form of economic cooperation by promoting deeper integration in the regulatory structures of the participating countries. The answer to this question has profound implications for the future of multilateral cooperation through the World Trade Organization (WTO) and international economic relations generally. Regionalism, Multilateralism, and Economic Integration examines a number of very different regional agreements and finds that there is no one model for what constitutes deeper integration. Each of the agreements under review is the result of an attempt to achieve very different policy objectives. The result is that any assessment of the success or otherwise of a regional agreement should be made in the light of the objectives of the agreement concerned. At the same time, however, each of the agreements can be evaluated in terms of whether they contribute positively or negatively to the goals of the rules based multilateral trading system or otherwise. The authors conclude that regional trade agreements have indeed led to deeper integration in a number of fields, and that the regional processes and rules have been consistent with the multilateral obligations of the parties to the agreements. They find that recent agreements are generally more effective in facilitating trade and improving transparency than the more remote WTO procedures. Most agreements restate the obligations of the parties to the World Trade Organization Agreements. In this sense, the WTO rules constitute a floor that underpins additional commitments in the regional agreements.

Regionalism, multilateralism and economic integration: the recent experience

In recent years, the central question relating to regional trade agreements has been whether or not they have led to a new form of economic cooperation by promoting deeper integration in the regulatory structures of the participating countries. The answer to this question has profound implications for the future of multilateral cooperation through the World Trade Organization (WTO) and international economic relations generally. Regionalism, Multilateralism, and Economic Integration examines a number of very different regional agreements and finds that there is no one model for what constitutes deeper integration. Each of the agreements under review is the result of an attempt to achieve very different policy objectives. The result is that any assessment of the success or otherwise of a regional agreement should be made in the light of the objectives of the agreement concerned. At the same time, however, each of the agreements can be evaluated in terms of whether they contribute positively or negatively to the goals of the rules based multilateral trading system or otherwise. The authors conclude that regional trade agreements have indeed led to deeper integration in a number of fields, and that the regional processes and rules have been consistent with the multilateral obligations of the parties to the agreements. They find that recent agreements are generally more effective in facilitating trade and improving transparency than the more remote WTO procedures. Most agreements restate the obligations of the parties to the World Trade Organization Agreements. In this sense, the WTO rules constitute a floor that underpins additional commitments in the regional agreements.

World trade organization and trade liberalization after Doxa

Developing countries have highlighted the importance of examine the interlink ages between trade, debt and finance in an effort to find sustainable solutions to these challenges within the context of the multilateral trading system. This paper analyzes what actions could be taken in the context of the WTO Doha negotiations to assist countries to benefit from deeper trade integration. It discusses the policy agenda that confronts many developing countries and identifies a number of focal points that could be used both as targets and as benchmarks to increase the likelihood that WTO negotiations will support development. To achieve these targets a number of negotiating modalities are proposed for both goods and services-related market access issues, as well as rule making in regulatory areas. Developing countries must approach WTO negotiations with a firm view of their national priorities, and seek to ensure that multilateral obligations will assist in and not detract from, the realization of development objectives. For the development community this implies priority should be given to strengthening the capacity to identify national priorities and to analyze the cost and benefits of proposed agreements in light of those priorities.

A Typology of Multilateral Treaty Obligations: Are WTO Obligations Bilateral or Collective in Nature?

An important, though oft neglected, distinction between multilateral treaty obligations separates obligations of a bilateral nature from those of the collective or erga omnes partes type. Multilateral obligations of the bilateral type can be reduced to a compilation of bilateral, state-to-state relations. They can be compared to contracts. Collective obligations, in contrast, cannot be divided into bilateral components. They are concluded in pursuit of a collective interest that transcends the individual interests of the contracting parties. The standard example of such obligations are those arising under a human rights treaty. In domestic law, collective obligations can be compared to criminal law statutes or even domestic constitutions. This essay examines the origins of the distinction between bilateral and collective obligations, as well as its major consequences, both in the law of treaties and the law on state responsibility. On that basis, a wider typology of multilateral treaty obligations is suggested. In the exercise, obligations arising under the World Trade Organization are used as a case study. The argument is made that WTO obligations remain essentially of the bilateral type; they are not collective in nature.

Liberalizacija trgovine, privredni razvoj i STO posle Dohe

This paper analyzes the actions that could be taken in the context of the WTO Doha negotiations to assist countries in benefiting from deeper trade integration. It discusses the policy agenda faced by many developing countries and identifies a number of focal points that could be used both as targets and as benchmarks to increase the likelihood that the WTO negotiations will support development. To achieve these targets a number of negotiating modalities are proposed both for goods and services-related market access issues, as well as rule making in regulatory areas. Developing countries must approach the WTO negotiations with a firm view of their national priorities, and seek to ensure that multilateral obligations will assist in, and not detract from, the realization of development objectives. For the development community this implies that the priority should be given to strengthening the capacity to identify national priorities and to analyze the cost and benefits of the proposed agreements in light of those priorities.

New State Responsibility Rules and Compliance with Multilateral Environmental Obligations: Some Case Studies of How the New Rules Might Apply in the International Environmental Context

New State Responsibility Rules and Compliance with Multilateral Environmental Obligations: Some Case Studies of How the New Rules Might Apply in the International Environmental Context

The international responsibility of states for breach of multilateral obligations

This article deals with the three main questions related to the violation of multilateral obligations in international law: definition of those obligations, the elements constituting a violation, and the effects of the latter. Observing that many obligations in international law, both in treaties and in customary international law, bind several states, or all states, in their mutual relations, thus creating parallel bilateral obligations, the author is of the opinion that they do not all correspond to the specific definition of 'multilateral obligations', but only those the violation of which is of concern for the international community. The violation of those multilateral obligations leads to state responsibility according to the normal, ordinary elements of responsibility: attribution to the state and violation of an obligation. There is no additional criterion. The quantitative element is merely relevant with respect to the reaction of other states. The breach of a multilateral obligation gives to the injured state the normal rights of the 'victim', whereas the other states are not 'victims' but are entitled to take measures aiming at the cessation of a conduct in breach of that obligation, without prejudice of conventional systems. An examination of the conditions and effects of breach by a state of multilateral obligations calls first and foremost for a definition of the term 'multilateral obligation', including identification of its specific features and nature. There follows the question of what does a breach of multilateral obligations consist of, what are its constituent elements. Consideration should also be given to the consequences in terms of international responsibility that may be incurred thereby, since the conception one may have of such responsibility is, in this author's opinion, quite closely linked to an analysis of the previous question. This is the order in which some ideas on this subject will be presented in this short paper.