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Dispute Settlement in the WTO

Dispute Settlement in the WTO. “a central element in providing security and predictability to the multilateral trading system” Article 3.2 DSU. Presented by: Peter Morrison Trade in Services Division WTO Secretariat. Overall aim: to secure compliance with the Agreements.

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Dispute Settlement in the WTO

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  1. Dispute Settlement in the WTO “a central element in providing security and predictability to the multilateral trading system” Article 3.2 DSU Presented by: Peter Morrison Trade in Services Division WTO Secretariat

  2. Overall aim: to secure compliance with the Agreements Quasi-judicial Nature Secured access Detailed procedures Automaticity in the proceedings Deadlines Possible appeal Dispute Settlement in the WTO:Overview

  3. An integrated system: Applies to all the multilateral agreements A single set of rules for all disputes Only a few specific rules in some agreements Dispute Settlement in the WTOScope

  4. Dispute Settlement in the WTOMain players • Dispute Settlement Body (DSB) • Panel and Appellate Body • Parties: WTO Members • WTO Secretariat

  5. Dispute Settlement in the WTO:Relationship of players Ministerial Conference Appellate Body Dispute Settlement Body (General Council) Panel Request for Panel by WTO Member

  6. Dispute Settlement in the WTO:Main Procedures 60 days 9 months 90 days 15 months

  7. Indicates reasons for the request: identification of the measures legal basis for complaint Notified to DSB and circulated to all Members Dispute Settlement in the WTOConsultations: the request

  8. Dispute Settlement in the WTO:Consultations: function • to “accord sympathetic consideration to and accord adequate opportunity for consultation…” • confidential, only between the Members concerned

  9. But, in some instances, other Members can request to be joined in the consultationsArticle 4.11 DSU “substantial trade interest” Dispute Settlement in the WTO:Consultations: third parties

  10. If consultations fail to resolve the matter within 60 days from receipt of request….. Or if no response or no entering into consultations …. A request for establishment of a panel can be made Dispute Settlement in the WTO:Consultations: if not successful

  11. Dispute Settlement in the WTO:Establishment of panels • Request for establishment: • must “identify the specific measures at issue and provide a brief summary of the legal basis of the problem sufficient to present the problem clearly” • Establishment • at the latest at the second DSB meeting at which the request is made; decided by negative consensus

  12. Terms of reference: (Article 7 DSU) Standard, or Special terms of reference Panel Composition: (Article 8 DSU) “well-qualified government and/or non-governmental individuals” Secretariat proposals indicative list of panelists nomination by DG Dispute Settlement in the WTO:Terms of reference and composition of panels

  13. Dispute Settlement in the WTO:Panels: how they function Functions of the Panel “…a panel should make an objective assessment of the matter before it, including an objective assessment of the facts of the case and the applicability of and conformity with the relevant covered agreements…” Functions of the dispute settlement system “… to preserve the rights and obligations of Members under the covered agreements, and to clarify the existing provisions of those agreements in accordance with customary rules of interpretation of public international law…” Art. 3.2 DSU

  14. Dispute Settlement in the WTO:Panel Procedures: main steps • Oral hearings (usually 2), on basis of written submissions • Descriptive part of report issued to parties • Interim review based on draft report • Final report issued to parties • Final report circulated to all Members

  15. Dispute Settlement in the WTO:Panel Procedures: other sources of input • Third parties have make presentations • need “substantial interest” (Article 10 DSU) • Panels may seek • factual information from any relevant source (Article 13 DSU) • scientific or technical advice from an Expert review group (Appendix 4 DSU) • Requirement of confidentiality(Article 14 DSU)

  16. As a general rule, 9 months from establishment of panel to consideration of report for adoption (if no appeal) 12 months where report is appealed (Article 20 DSU) Dispute Settlement in the WTO:Panel Procedures: duration

  17. Adoption within 60 days of circulation, by negative consensus…. … Exceptif appealed Dispute Settlement in the WTO:Panel procedures: Adoption of Panel Reports

  18. Appeals limited to “issues of law and legal interpretations developed by the panel” Appeal only open to parties to the dispute Appellate Body 7 members members to have recognized authority and expertise in international trade law members unaffiliated with any government Dispute Settlement in the WTO:Appellate Review

  19. Dispute Settlement in the WTO:Appellate Review: report and adoption Report of the Appellate Body: • “may uphold, modify or reverse the legal findings and conclusions of the panel” (Art. 17.12 DSU) • Adoption of Appellate Body report: by reverse consensus within 30 days of circulation to Members

  20. Member must bring the measures into conformity with its WTO obligations (Article 19 DSU) Member must inform DSB of its intentions in for implementation of the recommendations (Article 1 DSU) Dispute Settlement in the WTO:Implementation If there is a finding of violation:

  21. Dispute Settlement in the WTO:Implementation: reasonable period of time Determination of “reasonable period of time” for implementation: • proposed by Member, and approved by DSB, or • mutually agreed by the parties, or • determined through arbitration: • “guideline for the arbitrator”: 15 months from the date of adoption (Article 21.3 DSU)

  22. Dispute Settlement in the WTO:Implementation: surveillance • Surveillance by the DSB • Status reports on implementation • Temporary measures • If Member fails to bring measure into conformity within reasonable period of time, possibility • compensation or • suspension of concessions (retaliation)

  23. Compensation: (Article 22 DSU) Voluntary Negotiated Compatible with WTO Agreements If no compensation agreed within 20 days after expiry of reasonable period of time…. Dispute Settlement in the WTO:Implementation

  24. Dispute Settlement in the WTO: Implementation Suspension of concessions: • when authorized? • on expiry of 20 days after the end of the reasonable period of time • which products? • same sector/other sector/ other agreement • level of suspension? • “equivalent to the level of nullification or impairment” (Art. 22.4 DSU) • arbitration on level of suspension, or principles of Art. 22.3 DSU

  25. Dispute Settlement in the WTOPerformance to Date • Requests for consultations: 315 • Adopted reports: 82 • Mutually agreed solutions: 45 • Adopted compliance reports: 12 • Authorization for suspension: 7 (retaliation)

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