Session 9

1
Session 9 Government-to-government dispute
settlementprocedures

• WTO Dispute Settlement Understanding
• Vesile Kulaçoglu, WTO Secretariat
• Dar es Salaam, 14-17 January 2003

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

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Dispute Settlement in the WTO

• a central element in providing security and
  predictability to the multilateral trading
  system
• (DSU, Article 32)

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

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Functions of the DS system (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

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Dispute settlement in the WTOOverview

• A mechanism aimed at securing compliance with the
  Agreements

• detailed procedures
• automaticity in the proceedings
• deadlines
• implementation aimed at securing conformity of
  measures

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Dispute settlement in the WTOOverview

• Applies to all the multilateral agreements
• a single set of rules for all disputes
• only a few specific rules in some agreements

• An integrated system

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Main stages of the dispute settlement process

• Consultation phase
• Panel and Appellate Body review
• Adoption of report by the DSB
• Implementation

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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

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Task of panels

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

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Panel Procedures deadlines

• 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)

• 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)

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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
Appellate review

• 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

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• 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

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Implementation (I)

• 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)

• Recommendations
• If violation recommendation that the Member
  bring the measures into conformity
• (Article 19 DSU)

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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)

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Implementation (IV)

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

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