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International Trade Regulation

International Trade Regulation. Victor H. Bouganim WCL, American University. The New International Order. Multilateral. Regional. Global. Bi-lateral agreements. GATT. G eneral A greement on T ariffs and T rade

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International Trade Regulation

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  1. International Trade Regulation Victor H. Bouganim WCL, American University

  2. The New International Order Multilateral Regional Global Bi-lateral agreements

  3. GATT General Agreement on Tariffs and Trade • GATT negotiations start after world war II in order to facilitate international trade. • The Uruguay round introduces, among other things, the issue of IP in 1986. • The final agreements were concluded on December 1993 and signed on April 1994 in Marrakech. • The final agreements established the WTO - The World Trade Organization.

  4. Embodies the core principles of liberal market theory: Reduction of custom duties and removal of non-tariffs trade barriers “Most favored nation” principle Dispute settlement of trade issues Ultimate goals Increasing the world trade volume Raising the standard of living - globally Providing for full employment GATT/WTO Objectives

  5. General Ministerial Council Conference Committee Trade Policy Dispute Settlement on Trade Review Body Body & Development Committee on Budget, Finance Council for Director & Administration Trade in Goods General Committee on Balance of Payment Council for Restrictions Trade in Services Secretariat Council for TRIPs WTO Structure

  6. Dispute Settlement under WTO • Dispute Settlement Body: special assembly of WTO General Council, includes all members • Five stages to dispute resolution: • Consultation • Panel establishment, investigation and report • Appellate review of the panel report • Adoption of the panel and appellate decision • Implementation of the decision adopted • Could also have binding arbitration as alternative

  7. WTO Dispute Settlement Body • WTO Principles: • equitable, fast, effective, mutually acceptable • The Dispute Settlement Body (the General Council in another guise) has the sole authority to establish “panels” of experts to consider the case, and to accept or reject the panels’ findings or the results of an appeal. • It monitors the implementation of the rulings and recommendations, and • has the power to authorize retaliation when a country does not comply with a ruling.

  8. WTO Dispute Settlement Process - 1 • First stage: consultation • Up to 60 days • Before taking any other actions the countries in dispute have to talk to each other to see if they can settle their differences by themselves. If that fails, they can also ask the WTO director-general to mediate or try to help in any other way.

  9. WTO Dispute Settlement Process - 2 • Second stage: the panel • Up to 45 days for a panel to be appointed, plus 6 months for the panel to conclude. • If consultations fail, the complaining country can ask for a panel to be appointed. • The country “in the dock” can block the creation of a panel once, but when the Dispute Settlement Body meets for a second time, the appointment can no longer be blocked (unless there is a consensus against appointing the panel).

  10. WTO Dispute Settlement Process - 3 • The panel’s final report should normally be given to the parties to the dispute within six months. • In cases of urgency, including those concerning perishable goods, the deadline is shortened to three months.

  11. WTO Appeals Process • Either side can appeal a panel’s ruling. • Appeals have to be based on points of law such as legal interpretation — they cannot reexamine existing evidence or examine new evidence. • The appeal can uphold, modify or reverse the panel’s legal findings and conclusions. Normally appeals should not last more than 60 days, with an absolute maximum of 90 days. • The Dispute Settlement Body has to accept or reject the appeals report within 30 days — and rejection is only possible by consensus.

  12. WTO Dispute Settlement Enforcement • The Dispute Settlement Body monitors how adopted rulings are implemented. • Any outstanding case remains on its agenda until the issue is resolved.

  13. WTO - TRIPs • Trade-Related Aspects of Intellectual Property • a World Trade Organization (WTO) agreement • does not directly offer a private client any right to challenge the intellectual property laws of other nations • provides a bases for the US to urge other nations to adopt adequate protection to comply with the TRIPs mandates • creates standards and obligates WTO members to follow some of the concepts in several international conventions which safeguard intellectual property.

  14. Any advantage, favor, privilege or immunity granted by a member to any other country (or its nationals) shall be accorded immediately and unconditionally to all members (or their nationals). Exceptions Members entering: Customs unions Free trade areas Regional arrangements Preferential treatment Under-developed countries “Most Favored Nation”

  15. China’s WTO Accession • China's Working Party was established on 4 March 1987. • China's Draft Protocol and Working Party Report are almost completed, and are expected to be finalized in mid-September 2001. • It is expected that WTO Ministers will take a decision on China's terms and conditions of entry into the WTO at the Doha Ministerial Conference in November 2001.

  16. EC - EU European Community European Union NAFTA North American Free Trade Area USA, Canada & Mexico EFTA - EEA European Free Trade Area European Economic Area EU plus Norway, Switzerland ... Regional Trade Unions

  17. 15 member sates Goals Economic integration Ultimately - political union Removal of customs Free competition Harmonized laws The 4 freedoms Free movement of Goods Services Persons Capital Free movement of information? EU - European Union

  18. EU and NAFTA • Economic integration associations • Focus on regional development of nations with common interests • EU and NAFTA suggest that economic development will depend as much on regional trade agreements as on the worldwide WTO

  19. International Economic Institutions • International Organizations play a significant role in international trade • created to assume a supportive role in international business • e.g. OECD, The South Centre • The United Nations created specialized agencies to administer certain areas of international trade • e.g. WTO, ITU, WIPO, UNCITRAL

  20. OECD • Organization for Economic Cooperation and Development • Created by nations with mutual trade and investment interests • Composed almost exclusively of developed nations • Free trade advocate, establishing guidelines for multinational corporations

  21. Bretton Woods Conference • Post WWII conference to correct world-wide depression. Creation of: • International Monetary Fund (IMF) • General Agreement on Tariffs and Trade (GATT) • The World Bank

  22. IMF • Urge alterations in government policies where there were severe balance of payments dislocations • Restrictions on governments with respect to foreign exchange controls • Lines of credit available to correct imbalances • final source of loans for developing nations before they default on international obligations

  23. The World Bank • Formed as a lending agency • Provides low interest loans to the poorest nations • Provides panels of experts for arbitration and conciliation • Offers forms of insurance for trade and investment

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