LEGITIMACY OF WTO DISPUTE SETTLEMENT

1. LEGITIMACY OF WTO DISPUTE SETTLEMENT 1

2. LEGITIMACY IS NOT LEGALITY WHAT IS LEGAL MIGHT NOT BE ACCEPTED BY ALL STATES IN PUBLIC INTERNATIONAL LAWD AS LEGITIMATE E.G.: JUDGES AGAINST PARLIAMENTS PROBLEM IN NATIONAL LAW, BUT PARTICULARLY IN INTERNATIONAL LAW 2

3. EXAMPLES DOLE COMMISSION Suspicion against the Geneva judges Threat: Leaving the DSU/WTO BIRD AMENDMENT CASE DS against US Congress and sovereignty Threat: No implementation of WTO DS decisions HELMS BURTON CASE Security Concerns Damaging the DS procedure by disregarding it 3

4. Problems of Legitimacy • A new international court face to national legislation • Conflicts with Civil Society • Relations to other rules of international law • Political dimension of WTO law • Structure of the DS bodies • Procedural Rules: particularly lack of openness • Judicial activism • Protection of individuals 4

5. Thesis • Non-implementation of WTO law and DS decisions will quickly erode the whole WTO system that is based on law • If states find problems with the legitimacy of WTO DS they can remedy them in practice as well in changing the law. 5

6. A new court • New courts have to develop a standing of their own in a legal order like public international law where there is no means to really enforce their decision. • Being reliable and trustworthy, no activism, sticking to the powers conferred 6

7. Conflicts with Civil Society • Tuna - Dolphin cases in the end of GATT • „The GATT is blind to environment and human rights“ • Increasing protests against limitations by public international law of the states in developing public policies. • ACTA, TTIP, Investor-State Arbitration 7

8. Relations to other rules of international law • The Appellate Body has clearly stated that WTO law is part of general public international law • It therefore is informed by the developments of that law that happened since 400 years before • This stabilizes the interpretation and refers also to other methodological rules of PIL 8

9. Political dimension of WTO law • GATT initially was a set of rules with economic background • GATT DS was to preserve the mutually agreed economic advantages („nullification or impairment“ by a diplomatic procedure) • In GATT this system was charged more and more with law (unlawfulness as „prima facie nullification or impairment“) • This state of the law has been transferred to the WTO legal system 9

10. Structure of the DS bodies • Dispute Settlement Body is diplomatic, but thanks to the reverse consensus not the real decision-maker in disputes. Parties may not block decisions • The DSB consists of carefully chosen specialists of WTO law and produces high quality decisions • The panels are like arbitral tribunals, the qualification is mixed. EU proposal: standing panels as first instance 10

11. Procedural rules • Closed door principle (at the disposition of the parties) • Amicus curiae briefs for panels yes, for the AB disputed (the developing countries object!) • Some negative experiences from the past will be remedied now • Procedures are always more specialized (and therefore a problem for DCs with limited human resources). 11

12. Judicial activism • Parties wanted to restrain the DS organs as much as possible: „may not add or diminish the law“ • AB: right to use all methods of interpretation including the teleological one is natural for a highest court • MS are accepting the mildly progressive jurisprudence • AB tries to stick as close as possible to the texts of the WTO treaty system. 12

13. Protection of individual rights • WTO law contains no individual substantive or procedural rights • But it is designed to make individual traders trust in the protection of law • Individuals may complain to their states that may then initiate inter-state procedures. • Unfortunately the implementation procedure finally ends up as a system of controlled economic sanctions, that do not take into consideration individual rights • But this cannot be changed in a decentralized legal system without enforcement police powers 13

14. Why still international DS? • It is the only means to secure the rule of law with impartiality • that states and individuals (to a certain extent) may trust in • Reciprocity of submission • Mandatory and exclusive jurisdiction 14

15. Possible Solutions • Diplomacy is increasingly suspicious to Civil Society groups • more transparent procedures: open doors and amicus admission • strengthening the trust in the purely legal function of DS • independence, impartiality and legal security • self-control of judicial activism • Legal control of parliaments is indispensable in areas of legislation, if arbitrariness should be avoided and the protection of individual rights should be guaranteed. • Control of parliaments and of state powers are only possible through courts (at least internationally) • The previous ratification in parliaments gives as much democratic legitimacy as possible for an international Court 15

16. No arbitrary implementation • If member states are trying to take an exception to the general duty to implement WTO law and DS decisions, they are jeopardizing the whole DS system with its intrinsic value for the world trade order • Strict implementation of the DS rules is necessary for the functioning of the WTO as a whole. 16