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Understanding WTO Dispute Settlement Procedures

Explore the purpose, principles, and functions of the WTO Dispute Settlement system for secure and predictable trading. Learn about the stages of dispute resolution, panel and appellate body tasks, implementation of rulings, and compensation options.

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Understanding WTO Dispute Settlement Procedures

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  1. Session 9 – Government-to-government dispute settlementprocedures WTO Dispute Settlement Understanding Vesile Kulaçoglu, WTO Secretariat Dar es Salaam, 14-17 January 2003

  2. WTO Dispute Settlement Understanding • The Work of the Working Group on Transparency in Government Procurement

  3. Dispute Settlement in the WTO “a central element in providing security and predictability to the multilateral trading system” (DSU, Article 3:2)

  4. DS: Purpose • A system favouring mutually agreed solutions • A rule-oriented system • A system intended to secure withdrawal of inconsistent measures • Multilateralism v. unilateralism

  5. Functions of the DSsystem (Art. 3.2 DSU): “… 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…”

  6. DS: Principles • Exclusive application of WTO rules on dispute settlement to disputes related to the WTO • Uniform application to all WTO Agreements

  7. A mechanism aimed at securing compliance with the Agreements detailed procedures automaticity in the proceedings deadlines implementation aimed at securing conformity of measures Dispute settlement in the WTO:Overview

  8. 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 WTOOverview

  9. Main stages of the dispute settlement process • Consultation phase • Panel and Appellate Body review • Adoption of report by the DSB • Implementation

  10. Function of panels (Art. 11 DSU): “…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…”

  11. Task of panels • review the facts and arguments submitted by the parties to a particular dispute • Panel findings • Composition of panels

  12. As a general rule, 6 months from composition/terms of reference to issuance of final report of the panel to the parties (Art. 12.8 DSU) 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 (Art. 20 DSU) Panel Procedures: deadlines

  13. Task of the Appellate Body • review on appeal the issues of law addressed by panels “The Appellate Body may uphold, modify or reverse the legal findings and conclusions of the panel” (Art. 17.12 DSU) • Composition of the Appellate Body

  14. Review limited to “issues of law and legal interpretations developed by the panel” (Art. 17.6 DSU) Appeal only open to parties to the dispute Standing appellate Body 7 members persons of recognised authority and expertise in international trade law “unaffiliated with any government” Appellate review

  15. Report of the Appellate Body: • “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

  16. Recommendations: If violation: recommendation that the Member bring the measures into conformity (Article 19 DSU) Within 30 days of adoption of report, Member concerned informs the DSB of its intentions in respect of implementation of the recommendations and rulings (Article 1 DSU) Implementation (I)

  17. Implementation (II) 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)

  18. Implementation (III) • Surveillance by the DSB: Status reports on implementation • If Member fails to bring measure into conformity within reasonable period of time, possibility of temporary measures: compensation or “suspension of concessions” (retaliation)

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

  20. Implementation (V) Suspension of concessions: same sector/other sector/ other agreement • level of suspension: “equivalent to the level of nullification or impairment” (Art. 22.4 DSU) • authorization to suspend: within 30 days of expiry of reasonable period of time • arbitration on level of suspension or principles of Art. 22.3 DSU

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