The Legitimacy of the WTO

1. The Legitimacy of the WTO Prof. Thomas Cottier 7th Annual WTO Conference BIILC/IIEL London, May 23, 2007 World Trade Institute Berne

2. Introductory • Legitimacy v. legality • Trust, confidence, reliance and voluntary compliance of law: authority • Benchmark: rules and processes not perfect in any polity • Urgent need to clarify issues in an era of disintegration of WTO law World Trade Institute Berne

3. Agenda • Main objections to WTO legitimacy • Theories of legitimacy • The impact of multi-layered governance • Substantive issues • Procedural issues, in particular decision-making and democracy • Conclusions World Trade Institute Berne

4. Main Objections to WTO Legitimacy • The fatal attraction of WTO • Lack of domestic policy space • Fragmentation and incoherence in relation to other areas of international law and policy • The challenge of distributive justice and poverty alleviation; imbalances (no trickling down) • Dealing with MS as a black box • The challenge of democratic legitimacy • Inefficiency of the negotiating process World Trade Institute Berne

5. Theories • Input and output legitimacy (political science) • International Relations Theory • Realist schools • Liberal schools • Idealist schools • Law: Theory of Multi-layered Governance, vertical checks and balances, separation of powers World Trade Institute Berne

6. Multi-layered Governance • WTO law is part of multi-layered governance based upon negotiated delegations of MS powers • WTO law is a response to deficiencies and failures of the Nation State • WTO essentially overcomes vested interested and rent-seeking protectionism in MS • WTO essentially stabilises and contributes to international peace and prosperity World Trade Institute Berne

7. Achievements • Multilateralisation of tariff and non-tariff policies and law • Progressive liberalisation (goods and services) • Principles of non-discrimination • Most favoured Nation Treatment • National Treatment • Transparency • The Rule of law (DSU) • Economic growth World Trade Institute Berne

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10. Issues of Substantive Law • Does WTO law prevent MS from pursuing policies of redistribution at home? • Human Rights policies (e.g. TRIPs) • Climate change (PPMs) • Single undertaking, graduation and variable geometry • The role and impact of other international bodies • Do WTO MS fail to use existing policy spaces? • Competition law and policy • Labour standards and social policies? World Trade Institute Berne

11. Issues of Procedural Law • Democracy starts at home • Should WTO law support and coin democratic trade policy formulation? How to amend transparency and the rule of law? • Democracy at the WTO • Consensus based decision-making • From de facto to de jure weighted voting • The formal status of the Secretariat • The formal role of the private sector and NGOs • A Parliamentary Assembly World Trade Institute Berne

12. Conclusions • Non-exclusive factors of legitimacy encountered: • Economic growth and prosperity • Stability and peaceful relations • Rule of law, transparency • Participatory decision-making and democratic accountability • WTO deserves high level of legitimacy as backbone of the multilateral, multi-layered trading system World Trade Institute Berne

13. Thank you for your attention! World Trade Institute Berne