WTO Dispute Settlement System Research Articles

Taking the Fact/Law Distinction Not Too Seriously: the Status of Domestic Law within International Litigation

Abstract The article uses legal theory relating to the traditional distinction between fact and law in order to shed light on the procedural consequences of the consideration that domestic law is a fact in international law. The analysis first relies on formalism, and on the legal syllogism doctrine more specifically, to show that domestic law cannot be, in most cases, anything else than a fact in international legal reasoning. It then draws attention to a constructivist approach to facts according to which domestic law is subject to assessment and interpretation as any other fact is in the judicial process. It paves the way to understanding that the distinction between fact and law for the purposes of the scope of review in the WTO dispute settlement system, as in other appellate systems, is purely functional and must not be taken too seriously, contrary to what is suggested by some analyses of the practice.

Reforms on the WTO Dispute Settlement System from the Perspective of the Appellate Body

Reforms on the WTO Dispute Settlement System from the Perspective of the Appellate Body

THE REFORM OF DISPUTE SETTLEMENT SYSTEM OF THE WORLD TRADE ORGANIZATION: CONTRIBUTION AND PERSPECTIVES FROM INDONESIA

The WTO dispute settlement system is currently in crisis as the Appellate Body has been unable to perform its appellate review since December 11th, 2019. The US asserted that the AB has exceeded its authority. The crisis can be detrimental, especially for developing countries in international trade. The WTO Members have made efforts to reform the system. This paper uses qualitative and descriptive research to analyse the contribution of Indonesia to the system and its perspectives on the reform negotiations.
 Indonesia has contributed to the system and the Organization by clarifying interpretations of WTO agreements. In the reform negotiations, Indonesia has actively participated by joining a proposal to commence the selection of new AB members, supporting the result of “Walker Process” negotiations as a basis for future negotiation, and making some proposals such as formal communication to the WTO on a process in an informal process to implement the mandate of MC12 Outcome Document. As a negotiation strategy, Indonesia should continue its active participation by prioritizing accessible aspects that are interests of developing and LDC members, emphasizing the need to limit negotiation scope and urging the fulfilment of the 2024 deadline, safeguarding a legalistic system, and conducting a comprehensive analysis on two-tier litigation.

Neutrality Principles of WTO Dispute Settlement Mechanism: Legal and Moral Dimensions

This paper examines the neutrality principle of the WTO dispute settlement system, which functions as a quasi-judicial body in the settlement of international trade disputes. Given the system's resemblance to traditional courts, its effectiveness in ensuring justice hinges on its adherence to neutrality, ensuring fairness, impartiality, and the rule of law. Recent developments, such as the United States obstruction of the Appellate Body, underscore the tension between maintaining neutrality and addressing external pressures that may compromise this foundational principle. This study analyzes the complexities of the neutrality dynamic in the WTO dispute settlement mechanism and argues for the organization's imperative to protect neutrality amidst emerging challenges. the method used in this study is juridical normative with historical-descriptive characteristics. The research method used is qualitative. The findings of this paper will highlight the need to protect the neutrality principle of the WTO dispute settlement mechanism and the need for change or clarification of the confusion that this blending of economic or political power in DSM, and not beyond that the neutrality of WTO is the heart of this research.

The WTO Dispute Settlement System and How It Incentivizes Imparity Between Indonesia’s Executive and Parliament

The Indonesian zeitgeist to provide more checks toward the power of its executive organ to formulate and enter into international treaties and agreements during the infancy phase of the Reformasi era, which was spurred on by the international debt ballooning that they suffered under the leadership of President Soeharto, was somewhat undermined by the passing of the Law No. 24 of 2000, which effectively limits the involvement of the House in the formulation process of international treaties to which Indonesia would be a party to. This apparently voluntary weakening of the legislative’s oversight function is caused by the understanding that the realities of contemporary international intercourse has resulted in the increasing need for the formulation and entrance into international treaties and agreements as expeditiously as possible. The WTO, as the manifestation of globalization and its byproduct, neoliberalism, plays a role in creating such a necessity, which in turn incentivizes the imparity between the legislative and executive branches of the Indonesian government. The focus of this article is its dispute settlement system, and how its strengths and its weaknesses, has created the incentive for negotiations and expeditious decision making outside of the system itself, which requires a considerable degree of latitude to be afforded to the party involved in such negotiations, the executive. The discussion in this paper delves upon works dealing with the theoretical implications of several aspects of the WTO dispute settlement system and a case study of the US-Clove Cigarettes Case, which perfectly demonstrates said implications toward Indonesia.

An Examination of the Prospects and Challenges to a Well-functioning WTO Dispute Settlement System. Case: Deadlock of the Appellate Body

An Examination of the Prospects and Challenges to a Well-functioning WTO Dispute Settlement System. Case: Deadlock of the Appellate Body

Using res judicata to resolve jurisdictional conflicts between WTO and regional trade agreements’ dispute settlement mechanisms

The WTO has a renowned dispute settlement body, distinguished from other dispute settlement bodies by its compulsory and exclusive jurisdiction. However, regional trade agreements provide for rights and obligations similar to those guaranteed by the WTO thus, causing material jurisdictional overlaps between the WTO institutions and regional dispute resolution institutions. Potentially, a State aggrieved by measures that contravene rights or obligations within such overlaps has two alternative fora for dispute resolution. Where the regional trade agreement dispute resolution mechanism resolves the dispute first, the compulsory and exclusive nature of the WTO jurisdiction allows the matter to be re-determined at the WTO level, causing jurisdictional conflicts and duplicative proceedings. Although it is an established principle in customary international law, res judicata is not provided in any of the instruments guiding the jurisdiction of the WTO dispute settlement system. The jurisprudence of WTO Panels and the Appellate Body are also thin on this matter. Seemingly, the inclination has been to exercise the compulsory and exclusive jurisdiction, without regard to other existing fora. This paper therefore suggests clear recommendations to be employed in widening the existing WTO jurisprudence on res judicata as a solution to jurisdictional conflicts. In doing so, this paper further acknowledges the possible criticisms against res judicata in WTO dispute settlement and provides possible solutions to these challenges to ensure the peaceful and harmonious coexistence of the WTO dispute settlement mechanisms vis-à-vis those of regional trade agreements. Using the South American region as an example, this paper enunciates the jurisdictional overlaps and proposes the application of res judicata by the WTO dispute settlement mechanisms in judicial restraint

ISDS 2.0: time for a doctrine of precedent?

Abstract The reform process for ISDS at UNCITRAL is reaching its climax. Within the next few years, a treaty for ‘ISDS 2.0’ should emerge from this process. A key feature of ISDS 2.0 will be a new international court for resolving investor–state disputes. This court should include an appellate tribunal. A core function of this appellate tribunal will be to produce consistent case law, noting a common complaint about ‘ISDS 1.0’ is that it has produced inconsistent case law. There is good reason to believe that the appellate tribunal of ISDS 2.0 can deliver consistent case law, but the promoters behind ISDS 2.0 need to be careful what they wish for. The WTO dispute settlement system produced consistent case law, yet that achievement turned out to be a reason for its subsequent breakdown. Consistent case law apparently sounds good in theory, but it is not welcome in practice. Is there a way out of this conundrum? This article proposes that a formal doctrine of precedent is the solution. This proposal might initially provoke some surprise—a softer system of precedent is apparently the best compromise. But a doctrine of precedent can be crafted to limit adjudicative law-making power, while emphasizing states’ control over their investment–treaty obligations. This article puts forward the broad outline of this conception of a doctrine of precedent, explains why it gives effect to states’ interests, and examines the methods by which a doctrine of precedent could be adopted.

A Study on the Dispute Settlement System of Regional TradeAgreements as an Alternative to the WTO Dispute Settlement System

Purpose – The purpose of this study is to analyze the structure and characteristics of RTA-DSM, and to analyze the potential of RTA-DSM as an alternative to the WTO-DSM in the crisis of the WTO dispute sttlement system. Design/Methodology/Approach – This paper largely is a literature review. It adopts a method of examining the texts of regional trade agreements based on the WTO RTA database. In addition, this study does not perform legal analysis as much as possible, and analyzes RTA-DSM from an institutional point of view. Findings – RTA-DSM has a similar structure to the WTO-DSM. However, the content of RTA-DSM is insufficient compared to the WTO-DSM, and as a result, there are few cases of dispute resolution. The crisis of the Appellate Body and the rapid evolution of RTA-DSM have increased the importance of RTA-DSM as an alternative to the WTO-DSM. The introduction of dispute settlement systems in regional trade agreements is an irreversible trend, and considering the usefulness, cases of dispute resolution using RTA-DSM will increase rapidly in the future. Research Implications – RTA-DSM cannot completely replace the WTO-DSM. In the long term, WTODSM should be restored, and RTA-DSM should play a supplementary role. The centrality of the WTO, which supports the multilateral trade system, must be maintained through the restoration of the WTO-DSM.

Improvement of the WTO Dispute Settlement System Effectiveness and the Monetary Compensation

This article examines the effectiveness of the suspension of concessions or other obligations taking into consideration the interpretation of the objectives of that measure by WTO doctrine and case law. In order to access if the suspension of concessions contributes to the effective implementation of the WTO DSB decisions and recommendations, the article adopts the theoretical concept of technical efficiency. Departing from an argument based on WTO doctrine and on the analysis of cases adjudicated by the WTO DSB, in which the measure was applied, the study demonstrates a mere partial efficaciousness of the suspension of concessions for the DSB compliance procedure. In this regard, it is suggested that the DSU adopts the institute of reparation, present in the International Public Law, aiming to stablish the obligation of indemnify the damages caused throughout the dispute settlement procedure, due to the continuation of the illegal practice by the transgressor member. The article concludes, therefore, with a proposal for including the retroactive monetary compensation in the DSU, in order to reinforce its compliance procedure and offering more effectiveness to the WTO DSS.

PROTECTIONISM IN CONDITIONS OF WORLD TRADE MULTIPOLARITY

In terms of the formation of the world trade multipolar system, the issues concerning the implementation of a protectionist trade policy appear especially acute and are the primary focus of both theorists and practitioners. This paper primarily aims to explore trade protectionism in the global economy in conditions of multipolarity, to identify the vectors of the war in Ukraine's influence on policy in the sphere of food trade, to determine the origins of the WTO crisis in the system of multilateral regulation of international trade and to assess the prospects of further ensuring free trade doctrines, which is based on combinatorial approach and included the calculation of quantitative indicators of foreign trade restrictiveness and estimation of qualitative parameters of shifts in foreign trade policy. The empirical findings indicate high dynamism of increasing new trade restrictions, in particular export ones, caused at first by the COVID-19 pandemic and later by the war in Ukraine; slow but constant increase in import restrictions, so that at the end of 2022 9% of global import was affected by import restrictions; growth in export restrictive measures on food, feed and fertilizers as a response to food security challenges, caused by the war in Ukraine. The current paper reveals the necessity to take into account import dependence indicators and import capacity of export in formulating vectors of transformation of foreign trade policy towards national production support in the context of economic nationalism ideology. The authors emphasize the importance of the WTO dispute settlement system and the failures in its implementation call into question the possibility of organization functioning in the existing format, particularly as the number and spread of RTAs surged. Prospects for further research in this area are the assessment of macroeconomic effects and threats of the unilateral opening of the Ukrainian economy for imports against the background of the protectionist policy of "main players" of the world economy, determination of the potential of the protectionist policy of selective types of economic activity implementation in the conditions of post-war recovery.

From Confrontation to Coexistence: An Appeal Opt-out Arrangement as An Inclusive Approach to Revive the WTO Dispute Settlement System?

From Confrontation to Coexistence: An Appeal Opt-out Arrangement as An Inclusive Approach to Revive the WTO Dispute Settlement System?

The Multi-party Interim Appeal Arbitration Arrangement: An Update

The World Trade Organization’s Appellate Body (AB) continues to face an existential and operational crisis. Since 2017, the United States has blocked the selection of replacements for retiring AB members. As a result, the Appellate Body no longer has any active members and, therefore, cannot function. In March 2020, a group of 16 WTO members, including the European Union, promoted an initiative to establish a ‘multi-party interim appeal arrangement’ (MPIA), as an alternative to AB proceedings pending a resolution of the AB impasse. The arrangement is intended to allow disputes to be resolved finally by an impartial adjudicating body and to preserve a two-tier WTO dispute settlement system, until the Appellate Body resumes its functions. This Article provides a review of the structure and provisions of the MPIA and an update on how it has worked in practice. To date, no WTO dispute has gone through the MPIA process. However, in two recent disputes, Türkiye, which is not an MPIA party, and the European Union entered into agreements on appeals using a process very similar to the MPIA. One of those disputes has proceeded to the appeal stage under this arrangement. This note also provides the review of the differences between the MPIA and the Türkiye-EU mechanism. The World Trade Organization's disputes, the Dispute Settlement Body, Appellate Body Members, Multi-party interim appeal arrangement, MPIA, structure, appeal arbitration procedure, arbitrators, MPIA arbitrator, outgoing disputes, the first case to use appeal, Article 25 Arbitration, Türkiye-EU appeal arbitration agreement, WTO reform, MC12 outcome.

Trump Ended WTO Dispute Settlement. Trade Remedies are Needed to Fix it

AbstractUnhappy with the rulings of the WTO dispute settlement system, which disproportionately targeted US use of trade remedies, the United States ended the entire system in 2019. There are multiple hurdles to agreeing to new terms of trade remedy use and thus potentially restoring some form of binding dispute settlement. First, a change would affect access to policy flexibility by the now large number of users of trade remedies. Second, although China's exports are the overwhelming target of trade remedies, exporters in other countries increasingly find themselves caught up in trade remedy actions linked to China. Third, critical differences posed by China's economic model may call for new rules for trade remedies, but no consensus on those rules has emerged. Even some of the most promising reforms have practical limitations, create additional challenges, or may be politically unviable.

Is the WTO Dispute Settlement System a Disaster for the U.S.? An Evaluation of U.S. – China WTO Disputes

Is the WTO Dispute Settlement System a Disaster for the U.S.? An Evaluation of U.S. – China WTO Disputes

The WTO Dispute Settlement System as a Forum for Climate Litigation?

The WTO Dispute Settlement System as a Forum for Climate Litigation?

Unmasking the Phantom of the Opera: Is there a Hidden Secretariat in the WTO Dispute Settlement System?

In their article “Who Guards the ‘Guardians of the System’? The Role of the Secretariat in WTO Dispute Settlement,” Joost Pauwelyn and Krzysztof Pelc recharacterize the World Trade Organization's Dispute Settlement System (DSS) as a sui generis administrative review system wherein the “Guardians of the System,” i.e., the Secretariat, no longer merely “assists” panels and the Appellate Body (AB) in their reports, but also exerts influence and control over adjudicators. For them “‘the guardians of the system’ may have contributed to the system's demise by the expansion of their influence.” This Essay attempts to illustrate that Pauwelyn and Pelc's fatalistic view of the DSS is overstated, by providing some comments into the practical functioning of the DSS. We argue that, first, the “guardians of the system” are also restrained by suitable accountability mechanisms in their functions relating to appointment and financial “oversight” of adjudicators. Second, while acknowledging that the Secretariat retains a much stronger institutional memory than adjudicators, we suggest that this asymmetry between the staff and adjudicators’ familiarity with World Trade Organization (WTO) law and policy is not as stark and irredeemable as painted by the authors. Rather, the Secretariat's contribution to consistency and predictability in institutional decisions is ultimately desirable. For governments who established and make use of the WTO dispute system, the balance between ensuring legal coherence and preventing over-judicialization is at the core of the DSS. The participation of diplomats as panelists and the simultaneous creation of an office of Legal Affairs within the Secretariat was intended to ensure consistency in resolution of the members’ disputes to preserve a rules-based system. Finally, we contend that there is a strong internal legitimacy to Secretariat roles.

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.

The WTO Dispute Settlement System in 2020: Facing the Appellate Body Paralysis

The WTO Dispute Settlement System in 2020: Facing the Appellate Body Paralysis

TRIPS Pluralism

AbstractThe article explains that the interpretation of the TRIPS Agreement by WTO dispute-settlement panels and the Appellate Body has palpably shifted since the establishment of the WTO in 1995. Some of this shift is also arguably present in disputes concerning other WTO instruments. This progressive shift comes at a time when key debates about TRIPS waivers are taking place on the rue de Lausanne, namely a first for the COVID-19 pandemic and a second possible one for environmental protection measures related to climate change. According to the proposed pluralist analysis of TRIPS, it was less likely as of 2020 that the WTO dispute-settlement system would find unjustifiable inconsistencies between WTO commitments, on the one hand, and measures to protect public health or mitigate climate change, on the other hand. Whether future Appellate Body will follow that jurisprudence is an open question. Though the analysis contained in the article may make the COVID-related TRIPS waivers doctrinally unnecessary and allow Members to take measures now, its main aim is to inform the debates about the waivers and the future interpretation of the TRIPS Agreement, including the three-step test.