Resolution of international trade disputes in the WTO and other Fora

Author:Giorgio Sacerdoti
Position:Department of Law, University of Bocconi, Milan, Italy
Pages:147-156
SUMMARY

Purpose - The purpose of this paper is to assess the success of the world trade organisation (WTO) dispute settlement system and its transferability to other fora. Design/methodology/approach - The paper compares the design and case law of trade and investment law, and seeks lessons for the settlement of trade and investment disputes... (see full summary)

 
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Resolution of international trade
disputes in the WTO and
other Fora
Giorgio Sacerdoti
Department of Law, University of Bocconi, Milan, Italy
Abstract
Purpose – The purpose of this paper is to assess the success of the world trade organisation (WTO)
dispute settlement system and its transferability to other fora.
Design/methodology/approach The paper compares the design and case law of trade and
investment law, and seeks lessons for the settlement of trade and investment disputes in other fora.
Findings It concludes that despite its shortcomings, the WTO Appellate Body provides vital
stability regarding legal interpretations, something notably absent from other fora.
Originality/value – The paper offers the perspective of a former Member and Chairman of the WTO
Appellate Body on the success of the dispute settlement system.
Keywords WTO, Appellate body, Dispute settlement, Investment law, Trade law
Paper type Research paper
1. Introduction
The world trade organisation (WTO) dispute settlement system (DSS) is considered a
success story from several points of view as a functioning system to settle international
economic disputes between States by third-party impartial and law-based adjudication.
This success is evidenced rst of all by the great number of disputes that are brought to
the system[1], an evidence of the condence that members of the WTO have in the
usefulness and the efciency of the system: both as to process and outcomes to redress
breaches to the rules and reinstate the mutual balance of expected trade benets.
This includes the capability of the system to manage these disputes in the reasonable
rather short time frames, that has been set in the interest of the security of trade ows
unimpeded by illegal and unexpected obstacles[2]. More specically, a noteworthy
feature of the system’s operation is that both large trading nations and small economies,
as well as industrialised and developing countries have had recourse to it[3]; and that by
and large, the rule of law has prevailed irrespective of the imbalance in economic power
of the actors, justifying the dictum that the multi-lateral trading system has evolved
from a “power-oriented” system (the GATT) to a rule-based system (the WTO).
In this respect, the two-stage mechanism, ad hoc panels and appellate review by a
permanent body [the Appellate Body (AB)], formally “quasi-judicial” but in substance
having the features of an international court, has ensured well-reasoned interpretation
(leading to general acceptance of the outcomes), consistency in application,
predictability of the operation of the system and of the import of its rules for the benet
of all WTO members (and behind them for the business and trading community) well
beyond the solution of specic disputes (Sacerdoti et al., 2006).
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1477-0024.htm
Resolution of
international
trade disputes
147
Journalof International Trade Law
andPolicy
Vol.14 No. 3, 2015
pp.147-156
©Emerald Group Publishing Limited
1477-0024
DOI 10.1108/JITLP-11-2015-0036

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