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A Critical Analysis of the WTO Dispute Settlement Mechanism: Its Contemporary Functionality and Prospects
Published online by Cambridge University Press: 21 May 2009
Extract
In practical terms, international conflicts relating to the flow of trade are unavoidable. Therefore, as stated in Article 3.2 of the Understanding on Rules and Procedure Governing the Settlement of Disputes (‘DSU’ or ‘Understanding’), the ‘[d]ispute settlement system of the [World Trade Organization (“WTO”)] is a central element in providing security and predictability of the multilateral trading system’.
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References
2. Annex 2 to GATT Secretariat Final Act Embodying the Results of the Uruguay-Round of Multilateral Trade Negotiations, 15 April 1994, reprinted in 33 ILM(1994) p. 1226 (hereinafter ‘WTO Agreement’). In, General Agreement on Tariffs and Trade 1994, 15 April 1994, Marrakesh Agreement Establishing the World Trade Organization, reprinted in 33 ILM(1994) p. 28 (hereinafter ‘Covered Agreements’).
3. See ‘US-EU Discuss Alternative Dispute Settlement Procedures’, Inside US Trade, 8 June 2001.
4. It could also involve the employment of alternative dispute resolution techniques as a part of consultations between parties to a dispute.
5. One of the most important factors is that rounds of negotiations are complicated and last for many years.
6. It states: ‘if any contracting party should consider that any benefit accruing to it directly or indirectly under this Agreement is being nullified or impaired or that the attainment of any objective of the Agreement is being impeded as the result of (a) the failure o f another contracting party to carry out its obligations under this Agreement, or (b) the application by another party o f any measure, whether or not it conflicts with the provisions of this Agreement, or (c) the existenc e of any other situation, the contracting party may, with a view to the satisfactory adjustment of the matter, make written representations or proposals to the other contracting parties which it considers to be concerned. Any contracting party thus approached shall give sympathetic consideration t o the representations or proposals made to it.’
In Final Act Embodying the Results of the Uruguay Round of Multilateral Trade Negotiations, 14 April 1994, Covered Agreements, supra n. 2.
7. Art. XXIII: 1(b) in Covered Agreements, supra n. 2.
8. Appellate Body Report: WT/DS50/AB/R (19 December 1997), para. 39 (hereinafter India – Patent Appellate Body Report), available at http://www.wto.org/english/tratop_e/dispu_e/dispu_e.htm.
9. WTO Agreement, supra n. 2.
10. Art. 3.2 of the DSU, supra n. 2 (hereinafter Articles of the DSU unless specifically indicated).
11. See Jackson, J.H. et al. , Legal Problems of International Legal Relations (St. Paul, West Publishing 1995) p. 340.Google Scholar
12. See WTO Agreement, supra n. 2; Dispute Settlement Body (hereinafter ‘DSU’).
13. The Covered Agreements under the WTO umbrella are enumerated in Annex I and include: General Agreement on Tariffs and Trade 1994; Understanding on the Interpretation of Article II:I(b) of GATT 1994; Understanding on the Interpretation of Article XVII of the GATT 1994; Understanding on Balance-of-Payments Provisions of GATT 1994; Understanding on the Interpretation of Article XXIV of the GATT 1994; Understanding in Respect of Waivers of Obligations under GATT 1994; Understanding on the Interpretation of Article XXVIII of the GATT 1994; Marrakesh Protocol to GATT 1994; Agreement on Agriculture; Agreement on the Application of Sanitary and Phytosanitary Measures; Agreement on Textiles and Clothing; Agreement on Technical Barriers to Trade; Agreement on Trade-Related Investment Measures (TRIMs); Agreement on Implementation of Article VI of GATT 1994, the Customs Valuation Agreement; Agreement on Preshipment Inspection; Agreement on Rules of Origin; Agreement on Import Licensing Procedures; Agreement on Subsidies and Countervailing Measures; Agreement on Safeguards; General Agreement on Trade in Services (GATS) and its Annexes; Agreement on Trade-Related Aspects of Intellectual Property (TRIPS). See WTO Agreement and Covered Agreements, supra n. 2.
14. Nonetheless, under some agreements, special rules and procedures are applicable. The DSU is subject to any additional rules and procedures in Covered Agreements and to the extent these special or additional rules are different from those in the DSU, the specialized rules are to prevail. See Art. 1.1–2.
15. See Jackson, et al. , op. cit. n. 11, at p. 340.Google Scholar
16. Art. 2.4.
17. Arts. 16.4 and 17.14.
18. See Jackson, , et al., op. cit. n. 11, at pp. 340–341.Google Scholar
19. Appellate Body Report WT/DS22 (adopted 20 March 1997) para. 28.
20. Art. III:2 o f the Agreement Establishing the World Trade Organization, see WTO Agreement, supra n. 2; see also comments in Portuguese Republic v. Council, case C-149/96, Court of Justice o f the European Communities, 23 November 1999, available at <http://www.curia.eu.int/en/index.htm>, para. 42: ‘As regards, more particularly, the application of the WTO agreements in the Community legal order, it mus t be noted that, according to its preamble, the agreement establishing the WTO, including the annexes, is still founded, like GATT 1947, on the principle of negotiations with a view to ‘entering into reciprocal and mutually advantageous arrangements and is thus distinguished, from the viewpoint of the Community, from the agreements concluded between the Community and non-member countries which introduce a certain asymmetry of obligations, or create special relations o f integration with the Community, such as the agreement which the Court was required to interpret in Kupferberg.’
21. Art. 4.11.
22. Ibid.
23. See, e.g., Davey, W.J. and Porges, A., ‘Performance of the System I: Consultations & Deterrence Comments’, 32 International Lawyer (1998) p. 695 at p. 701.Google Scholar
24. Ibid.
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26. Implementing the WTO Singapore Declaration in 1997 and beyond, WTO Director-General Roberto Ruggiero's address to APEC Trade Ministers, Montreal 10 May 1997.
27. See Lauterpacht, E., Aspects of the Administration of International Justice (Cambridge, Grotius Publications 1991) p. 6.Google Scholar
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31. As stated by the Appellate Body: ‘[a]ll parties engaged in dispute settlement under the DSU must be fully forthcoming from the very beginning both as to the claims involved in a dispute and as to the facts relating to those claims. Claims must be stated clearly. Facts must be disclosed freely. This must be so in consultations as well as in the more formal setting of panel proceedings. In fact, the demands of due process that are implicit in the DSU make this especially necessary during consultations. For the claims that are made and the facts that are established during consultations do much to shape the substance and the scope of subsequent panel proceedings. If, in the aftermath of consultations, any party believes that all the pertinent facts relating to a claim are, for any reason, not before the panel, then that party should ask the panel in that case to engage in additional fact-finding.’ In India – Patent Appellate Body Report, supra n. 8, at para. 94.
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39. Art. 8.2.
40. For a practical example of a roster of governmental and non-governmental panelists, see, e.g., WTO Focus, Newsletter, August-September 1995, No. 5, p. 3.
41. Art. 8.5.
42. Art. 8.2.
43. Fn. 6 to Art. 8.3. However, the ban on panelists from states that are parties to the dispute is not absolute, it can be waived. See, e.g., Steger, D., in Bernal, R.L., Steger, D.P. and Stoler, A.L., ‘Key Procedural Issues: Resources Comments’, 32 International Lawyer (1998) p. 871 at pp. 875–876.Google Scholar
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47. Almost every dispute under the DSU involves a third party or multiple third parties.
48. The term non-governmental organization in the context of this paper is used in a broad sense and denotes all kinds of organizations pursuing social agendas (environmental, human rights, labour etc.) formally unaffiliated with any government as well as private enterprises or even individuals.
49. See Swacker, F.W., Redden, K.R. and Wenger, L.B., World Trade Without Barriers, Vol. I (Charlottesville, Michie Butterworth 1995) p. 178.Google Scholar
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53. Report of the Appellate Body, WT/DS138/AB/R (10 May 2000).
54. Ibid., at para. 39.
55. This argumentation was based on Art. 17.9 which simply states that: ‘Working procedures shall be drawn up by the Appellate Body in consultation with the Chairman of the DSB and the Director-General, and communicated to the Members for their information.’ See ibid.
56. Report of the Appellate Body, WT/DS135/AB/R (12 March 2001) (hereinafter EC – Asbestos).
57. Ibid., at para. 55.
58. Letter issued by Appellate Body Members, Feliciano, F., Bacchus, J., Ehlermann, C.-D., 16 November 2000, published at http://www.ibas.btinternet.co.uk/Frames/F_Amicus_Docs.htm.
59. See Ala, 'i, loc. cit. n. 52, at p. 64.Google Scholar
60. For example, in EC – Asbestos the Appellate Body received as many as 13 submissions from nongovernmental organizations. See EC – Asbestos, supra n. 56, at para. 56.
61. See also Hudec, , loc. cit. n. 50, at p. 48.Google Scholar
62. Ibid., at p. 49.
63. See Stewart, T.P. and Burr, M.M., ‘The WTO Panel Process: An Evaluation of the First Three Years’, 32 International Lawyer (1998) p. 709 at p. 729.Google Scholar
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66. See Clark, and Morrison, , loc. cit. n. 64, at p. 858.Google Scholar
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68. Analogous order of procedures exists under the NAFTA.
69. See comments infra section 2.7.
70. See, e.g., Schneider, A.K., ‘Democracy and Dispute Resolution: Individual Rights in International Trade Organizations’, 19 U Pa. J Int'l Econ. L (1998) p. 587 at p. 613.Google Scholar
71. Ibid.
72. Art. 14.1,3.
73. See Jackson, , et al., op. cit. n. 11, at p. 342.Google Scholar
74. See Debevoise, , loc. cit. n. 46, at p. 829.Google Scholar
75. See also Ibid., at p. 830.
76. See Wolff, A.Wm., ‘Reflections on WTO Dispute Settlement’, 32 International Lawyer (1998) p. 951 at p. 953.Google Scholar
77. See, inter alia, Nichols, P.M., ‘Extension of Standing in World Trade Organization’, 17 U Pa. J Int'I Econ. L (1996) p. 295 at pp. 319–321.Google Scholar
78. See, e.g., Wolff, , loc. cit. n. 76, at p. 955.Google Scholar
79. See Clark, and Morrison, , loc, cit. n. 64, at p. 851.Google Scholar
80. The unsuccessful Seattle Ministerial Conference of late 1999 can serve as a reminder of the importance of transparency and good public relations policies for the development of the WTO.
81. See, inter alia, arguments of Shell, R., ‘The Trade Stakeholder Model and Participation by Nonstate Parties in the World Trade Organization’, 17 U Pa. J Int'l Econ. L (1996) p. 359;Google Scholar and Charnovitz, , loc. cit. n. 29; as well as Esty, loc, cit. n. 67, at p. 709.Google Scholar
82. See also comments in Debevoise, , loc. cit. n. 46, at p. 818.Google Scholar
83. Art. 15.2.
84. Art. 15 Appendix 3 of the DSU determines time limits for implementation of the various stages in the panel process.
85. Ibid.
86. See Hudec, , loc. cit. n. 50, at p. 42.Google Scholar
87. Art. 2016 of the North American Free Trade Agreement, 32 ILM(1993) p. 605.
88. See Jackson, , et al., op. cit. n. 11, at p. 342.Google Scholar
89. Art. 16.4.
90. Art. 17.14. Apparently this change was made in expectations that it will satisfy for the most part American complaints about weaknesses in the GATT system and will consequently encourage the US to utilize the system in future cases instead of taking unilateral action as it has done in the past. See Hudec, R.E., Enforcing International Trade Law: The Evolution of the Modern GATT Legal System (Salem, NH, Butterworth Legal Publishers 1993) pp. 13–14.Google Scholar
91. Art. 23.1; see Jackson, , et al, op. cit. n. 11, at p. 343.Google Scholar
92. For an opposite view see Frechette, S., Hathaway, C.M. and Prado, V. Do, ‘Performance of the System III: Appellate Body. Comments’, 32 International Lawyer (1998) p. 747 at p. 752.Google Scholar
93. See Hudec, , loc. cit. n. 50, at p. 29.Google Scholar
94. See, e.g., Hudec, , op. cit. n. 90, at p. 364.Google Scholar
95. See also infra section 2.13.4.
96. See Lowenfeld, , loc. cit. n. 38, at p. 483.Google Scholar
97. Art. 17.4.
98. See, e.g., Frechette, , et al., loc. cit. n. 92, at p. 750;Google Scholar see also Nogueira, G., ‘The First WTO Appellate Body Review United States – Standards for Reformulated and Conventional Gasoline’, 30 Journal of World Trade (1996–1996) pp. 17–19.Google Scholar
99. Appellate Body, Working Procedures for Appellate Review, revised version dated 28 February 1997, at WTO website (hereinafter Working Procedures), Rule 6:2.
100. Establishment of the Appellate Body: Recommendations by the Preparatory Committeefor the WTO approvedby the Dispute Settlement Body on 10 February 1995, para. 7, WTO Doc. WT/DSB/1 (19 June 1995).
101. See, e.g., ‘China and the WTO, Leaders’, The Economist, 3–9 April 1999.
102. During the first two years, the Presiding Members of the Appellate Body were Mr. James Bacchus of the United States, Mr. Christopher Beeby of New Zealand, Professor Claus-Dieter Ehlermann of Germany, Justice Florentino Feliciano of the Philippines, Mr. Julio Lacarte Muro of Uruguay, Dr. Said El-Naggar of Egypt and Professor Mitsuo Matsushita of Japan. See ‘Swearing-in Ceremony of Appellate Body Members’, WTO Secretariat, Press/37 (13 December 1995).
103. See ‘Letter from Julio Lacarte-Muro’, Chairman, WTO Appellate Body, to Lafer, Celso, Chairman, WTO Dispute Settlement Body (7 February 1996), 35 ILM (1996) pp. 498, 499Google Scholar; see also Hudec, , loc. cit. n. 50, at p. 29.Google Scholar
104. Working Procedures, supra n. 99, Rule 3:2.
105. See Hudec, , loc. cit. n. 50, at p. 29Google Scholar; see also EC – Asbestos, supra, n. 56.
106. Art. 17.14.
107. See Hudec, , loc. cit. n. 50, at p. 48.Google Scholar
108. See comments in Lichtenbaum, P., ‘Procedural Issues in WTO Dispute Resolution’, 19 Mich. JIL (1998) p. 1195 at p. 1268.Google Scholar
109. Appellate Body Report, adopted 20 May 1996, WT/DS2/AB/R, pp. 13–29 (hereinafter US- Gasoline); See comments in European Communities – Measures Affecting the Importation of Certain Poultry Products AB–1998–3 Report of the Appellate Body, WT/DS69/AB/R (13 July 1998), para. 156 (hereinafter EC – Poultry).
110. For example in cases like Korea – Taxes on Alcoholic Beverages or Australia – Measures Affecting Importation of Salmon AB–1998–5 Report of the Appellate Body, WT/DS18/AB/R (20 October 1998) (hereinafter Australia – Salmon); European Community – Measures concerning Meat and Meat Products (EC – Hormones) AB–1997–4 Report of the Appellate Body, WT/DS26/AB/R WT/DS48/AB/R (16 January 1998), para. 162 (hereinafter EC – Hormones).
111. Ibid., at para. 132.
112. Ibid.
113. The Appellate Body pursued what it called a ‘careful consideration of the panel record’, on whether the claimants made a prima facie case which inevitably involved a review of at least some of the factual evidence; see Lichtenbaum, , loc. cit. n. 108, at p. 1269.Google Scholar
114. The Appellate Body used information included in the panel report to make its own factual finding before deciding contrary to the panel that the differentiation between zootechnical and therapeutic hormones s i not in itself ‘arbitrary or unjustifiable’. See EC – Hormones, supra n. 110, at paras. 223–225; See also Lichtenbaum, , loc. cit. n. 108, at p. 1270.Google Scholar
115. Report of the Appellate Body, adopted 30 July 1997, WT/DS31/AB/R, pp. 23–24 (hereinafter Canada – Periodicals); see also comments in Stewart, and Burr, , loc. cit. n. 63, at p. 709.Google Scholar
116. Canada – Periodicals, supra n. 115, at pp. 21–23.
117. Ibid. at p. 22.
118. Ibid., at p. 23.
119. See Lichtenbaum, , loc. cit. n. 108, at p. 1270.Google Scholar
120. EC – Poultry, supra n. 109, at paras. 107–108.
121. Ibid., at para. 156 (footnotes omitted).
122. As stated by the Appellate Body: ‘In certain appeals, when we reverse a panel's finding on a legal issue, we may examine and decide on issue that was not specifically addressed by the panel, in order to complete the legal analysis and resolve the dispute between the parties.’ Australia – Salmon, supra n. 110, at para. 7, p. 34 (emphasis added).
123. See Overview, supra n. 34.
124. For example, the very first report: US Gasoline is frequently quoted in following panel and appellate reports. Significantly in this report the Appellate Body stated that: ‘The General Agreement is not to be read in clinical isolation from public international law’. See US – Gasoline, supra n. 109, at p. 11.
125. See Vienna Convention published in 8 ILM (1969) p. 679.
126. See generally US – Gasoline, supra n. 109.
127. See Vienna Convention, supra n. 125.
128. See McRae, D.M., ‘The Emerging Appellate Jurisdiction in International Trade Law’, in Cameron, J. and Campbell, K., eds. The Dispute Settlement Resolution in the World Trade Organization (London, Cameron 05 1998) p. 108.Google Scholar
129. Japan – Taxes on Alcoholic Beverages, Report of the Appellate Body (4 October 1996), WT/DS8/B/R, WT/DS/10/AB/R, WT/DS11/AB/R, p. 37 (hereinafter Japan – Alcoholic Beverages).
130. See Mengozzi, P., ‘The WTO Law: An Analysis of Its First Practice’, in Mengozzi, P., International Trade Law on the 50th Anniversary of the Multilateral Trade System (Milan, Dott. A. Giuffre Editore 1999) p. 22.Google Scholar
131. See EC – Hormones, supra n. 110, at para. 123.
132. See US – Shrimp, supra n. 51, at paras. 129–130; see Schoenbaum, T., ‘The Decision in the Shrimp-Turtle case’, 9 Yearbook of Int'l Env. L (1998) p. 36 at pp. 37–38.Google Scholar
133. Swacker, , et al., op. cit. n. 49, at p. 178.Google Scholar
134. See Shapiro, I., Wilson, B. and Langeheine, W.B., ‘National Perspectives on the System. Comments’, 32 International Lawyer (1998) p. 811Google Scholar at p. 816; See also Frechette, , et al, loc. cit. n. 92, at p. 752.Google Scholar
135. Art. 3.12.
136. Art. 4.10.
137. Art. 8.10.
138. Art. 21.2,7,8.
139. Ibid., also Art. 24.
140. However, this was for a long time a weak provision since in practice the Director-General has not been involved in the consultation procedures. See Davey, and Forges, , loc. cit. n. 23, at p. 695.Google Scholar
141. Art. 24.1–2.
142. See Komuro, N., ‘The WTO Dispute Settlement Mechanism. Coverege and Procedures of the WTO Understanding’, 29 Journal of World Trade (1995) p. 58.Google Scholar
143. Art. 21.7–8.
144. See Parlin, C., ‘WTO Dispute Settlement: Are Sufficient Resources Being Devoted to Enable the System to Function Effectively?’, 32 International Lawyer (1998) p. 863 at p. 869.Google Scholar
145. See comments in European Communities – Regime for the Importation, Sale and Distribution of Bananas AB–1997–3 Report of the Appellate Body, WT/DS27/AB/R (9 September 1997), paras. 5, 9 (hereinafter EC – Bananas).
146. See Parlin, , loc. cit. n. 144, at p. 870.Google Scholar
147. For deliberations on judicial and procedural fairness see Franck, T.M., Fairness in International Law and Institutions (New York, Clarendon Press 1995).Google Scholar
148. See Agreement establishing the Advisory Centre on WTO Law, available at http://www.itd.org/links/acwladvis.htm.
149. See also Parlin, , loc. cit. n. 144, at p. 868.Google Scholar
150. Remarkably, the first panel and Appellate Body reports of the WTO: US – Gasoline, were issued in response to complaints by two developing countries – Venezuela and Brazil. Furthermore, the final settlement was also favorable to those countries. See WTO Focus, Newsletter, March-April 1996, No. 9, pp. 1–2; US-Gasoline, supra n. 109.
151. See Overview, supra n. 34.
152. It has been even argued that the percentage share ofdisputes initiated by the developing countries under the WTO remains the same as for the last 15 years of the GATT 1947. See Hudec, , loc. cit. n. 50, at p. 22.Google Scholar
153. See Overview, supra n. 34.
154. Since 1995 the DC's have to respond to more than 40 procedures initiated by developed countries. Ibid.. See also Hudec, , loc, cit. n. 50, at p. 23.Google Scholar
155. For example, the accession of China to the WTO had been strongly supported by this part of American business which is concerned with the ability to effectively defend its intellectual property rights. See, e.g., ‘China: US in push for WTO entry’, by Kynge, and de Jonqui, G.ères, Financial Times, 22 May 1998.Google Scholar
156. The development in the EC – Bananas case illustrates, inter alia, how former colonial powers attempt to influence their former colonies.
157. For example, as a result of the India – Patent dispute India, as one of the so-called ‘newly industrialized countries’, having the capacity to copy and reproduce technologically advanced industrial products was effectively forced, under the WTO legal regime, to recognize the US patent rights; see also Hudec, loc. cit. n. 50.
158. Art. 12.8.
159. Art. 12.9.
160. The notable exceptions to this excellent record have been made in some recent and more complicated cases. In the EC – Bananas, EC – Hormones (US) and Japan – Measures Affecting Photographic Film and Paper cases, it took the panels more than one year to finish their reports. See Overview, supra n. 34.
161. Art. 16.2.
162. See Vermulst, E. and Driessen, B., ‘An Overview of the WTO Dispute Settlement System and its Relationship with the Uruguay Round Agreements’, 29 Journal of World Trade (1995–2) p. 143.Google Scholar
163. Forexample, in the United States – Restrictions on Imports of Cotton andMan-Made Fibre Underwear case appellate procedures were concluded only after a delay, however still in the time limit of 90 days as provided in extraordinary provision of Art. 17.5. See Overview, supra n. 34; see also Steger, , loc. cit. n. 43, at p. 876.Google Scholar
164. See Overview, supra n. 34.
165. See Vermulst, and Driessen, , loc. cit. n. 162, at pp. 142–143.Google Scholar
166. Art. 21.3(c).
167. Even in the most difficult dispute, as in the EC – Bananas and the EC – Hormones cases, the Europeans formally committed themselves to implement the WTO recommendations to ‘honor its international obligations’ but refused to further specify any details of such compliance. See, e.g., ‘U.S. Asks For Arbitrator in Fight With EU over WTO Banana Ruling’, Inside US Trade, 5 December 1997; ‘EU to Reveal Few Details of Plans to Comply With Hormone Panel’, Inside US Trade, 13 March 1998.
168. In the EC – Bananas case, the European Union not only was reluctant to submit any specific information about its implementation strategy, but also its new bananas proposals was in an apparent violation of the WTO ruling. Yet, in its status reports the EC claimed a significant progress in implementation. In the EC – Hormones case during the ‘reasonable period’ the EC launched new scientific studies on the use of hormones, which as submitted in its last status report were not completed before the deadline for implementation. See, e.g., ‘European Commission Approves Controversial Banana Licensing Regime’, Inside US Trade, 30 October 1998; European Communities – Regimefor the Importation, Sale and Distribution of Bananas, Status Report by the European Communities, WT/DS27/17 (12 July 1998), para. 1; Bridges Weekly Trade News Digest, Vol. 3, No. 6, 15 February 1999; WTO Focus (January-February 1999) p. 37; European Communities – Measures Concerning Meatand Meat Products, Status Report by the European Communities, WT/DS26/17/Add. 3, WT/DS48/15/Add. 3 (16 April 1999).
169. The only exception in the early years of the WTO was in the EC – Bananas case when this deadline was extended forjust one week; see European Communities – Regimefor the Importation, Sale and Distribution of Bananas, Arbitration under Article 21.3(c) of the Understanding on Rules and Procedures Governing the Settlement of Disputes, WT/DS27/15 (7 January 1998).
170. European Communities – Measures Concerning Meat and Meat Products, Arbitration under Article 21.3(c) of the Understanding on Rules and Procedures Governing the Settlement of Disputes, WT/DS26/15 WT/DS48/13 (29 May 1998), para. 26.
171. For example, Korea needed only two months to implement DSB recommendations in Korea – Definitive Safeguard Measure on Import of certain Dairy Products. See Overview, supra n. 34.
172. See generally ibid.
173. Art. 19.1.
174. For example, in the first US – Gasoline case, which went through the whole length of the dispute settlement process, the US and Venezuela at the DSB meeting of 3 December 1996 agreed on a reasonable period of time for the implementation of the DSB recommendations on US standards for reformulated and conventional gasoline. Nonetheless, the other complainant in this dispute – Brazil – expressed concern over the length of the implementation period. In the Japan – Alcoholic Beverages case, like in the previous one, there was a concern regarding the implementation period, which finally was determined by the Arbitrator to be 15 months. In the UnitedStates – Restrictions on Imports of Cotton and Man-Made Fibre Underwear case, the US immediately complied with the recommendations of the DSB.; see Overview, supra n. 34.
175. Particularly, in cases such as EC – Bananas, Canada – Periodicals, EC – Hormones, Australia – Subsidies Provided to Producers and Exporters of Automotive Leather and United States – Tax Treatment for Foreign Sales Corporation’. See ibid.
176. See, e.g., Bridges Weekly Trade News Digest, Vol. 3, No. 13–14, 12 April 1999.Google Scholar
177. See, e.g., arguments of the former Senior Legal Officer and Counselor for Legal Affairs, GATT Secretariat Amelia Porges, in Porges, A., ‘The New Dispute Settlement: From the GATT to the WTO’, 1075 PLI/Corp (09 1998) p. 1095 at p. 1105.Google Scholar
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179. See Jackson, J.H., ‘The WTO Dispute Settlement Understanding – Misunderstandings on the Nature of the Legal Obligation’, 91 AJII (1997) p. 60 at pp. 62–63.Google Scholar
180. For arguments on the status of WTO obligations and on whether full implementation is the ‘preferred’ option see, e.g., Reif, T.M. and Florestal, M., ‘Revenge of the Push-Me, Pull-You: The Implementation Process under the WTO Dispute Settlement Understanding’, 32 International Lawyer (1998) p. 755 at pp. 760 et seq.Google Scholar
181. See generally Overview, supra n. 34.
182. See ‘The Contracting Parties to the General Agreement on Tariffs and Trade, Netherlands Measures of Suspension of Obligations to the United States’, GATT B.I.S.D. (1st Supp.) (1953) pp. 32–33; Jackson, , et al., op. cit. n. 11, at p. 344Google Scholar; See also Hudec, , loc. cit. n. 50, at p. 53;Google Scholar and Hudec, R.E., The GATT Legal System and World Trade Diplomacy, 2nd edn. (Salem, NH, Butterworth Legal Publishers 1990) p. 198.Google Scholar
183. Art. 22.1; see Vermulst, and Driessen, , loc. cit. n. 162, at p. 154.Google Scholar
184. Art. 22.2.
185. Art. 22.6.
186. Ibid.
187. Art. 22.7.
188. For example, the arbitration pursuant to Art. 22.6 was requested twice by the European Union in the EC – Bananas case and once by Australia in the Australia – Salmon case; see Overview, supra n. 34.
189. See Frechette, , et al., loc. cit. n. 92, at p. 751.Google Scholar
190. Ibid.
191. See Art. 2.7.
192. See Shoyer, and Forton, , loc. cit. n. 37, at pp. 737–738.Google Scholar
193. Ibid.
194. See comments supra section 2.16.
195. Gleason, C. and Walther, P.D., ‘The WTO Dispute Settlement Procedures: A System in Need of Reform’, 31 Law and Policy in International Business (2000) p. 709 at p. 727.Google Scholar
196. Ibid.
197. Apparently such suggestion has been made in Decision Regarding the Understanding on Rules and Procedures Governing the Settlement of Disputes, WT/MIN(99) (draft) (2 december 1999) in ibid., at p. 730.
198. See Swacker, , et al., op. cit. n. 49, at p. 180.Google Scholar
199. See Palmeter, D. and Mavroidis, P.C., ‘The WTO Legal System: Sources of Law’, 92 AJIL (1998) p. 398CrossRefGoogle Scholar at p. 409; The ICJ also stated: ‘[A]n important consideration is that the effects of a countermeasure must be commensurate with the injury suffered.’ Gabcikovo – Nagymaros Project, ICJ Rep. (1997) p. 92, para. 85.
200. Notably, the NAFTA restricts its signatories’ freedom to use the GATT dispute settlement process, if a dispute involves environmental standards.
201. Art. 22.9 and fn. 17 to this Article.
202. See also Fudali, C., ‘The Dispute Settlement Mechanism of the World Trade Organization: Two Years Later’, 24 CCIL Bulletin (Winter 1997–1998) p. 1 at pp. 24 et seq.Google Scholar
203. An example of a dispute which embodies many of the characteristic to the contemporary WTO dispute settlement procedure is the EC – Bananas case. It involved multiple complainants (Ecuador and the US) as well as third parties (Guatemala, Honduras, Mexico) which alleged that the EC's regime for importation of bananas was inconsistent with numerous GATT Arts. I, II, III, X and XII as well as other provisions. There was a significant number of decisions issued in this dispute (by panels, Appellate Body and arbitrators) This case is also remarkable for the fact that it was previously examined under the GATT 1947. The issue reappeared because of the apparent complainants’ belief in the newly enhanced WTO dispute settlement system; see Overview, supra n. 34; see also Steger, D.P. and Hainsworth, S.M., ‘New Directions in International Trade Law: WTO Dispute Settlement’, in Cameron and Campbell, op. cit. n. 128, at p. 51;Google ScholarEC – Bananas, supra n. 145, at pp. 5–6.
204. See Overview, supra n. 34.
205. See comments on implementation supra section 2.15.
206. The US recently proposed to the European Union a development of an alternative to the WTO dispute settlement system which would constitute a clear alternative to the mechanism included in the DSU. See Inside US Trade, 8 June 2001.
207. See comments supra section 2.4.
208. See extensive comments supra sections 2.8 and 2.10.
209. See extensive comments supra section 2.13.4.
210. See further comments supra section 2.15.
211. See comments supra section 2.19.
212. Henkin, L., How Nations Behave: Law and Foreign Policy (New York, F.A. Praeger 1968) p. 47.Google Scholar
213. Economic gains are commonly regarded as the major factor beyond states’ willingness to comply; see e.g., Petersmann, E.-U., ‘International Trade Law and the GATT/WTO Dispute Settlement System 1948–1996: An Introduction’, in Petersmans, E.-U., ed., International Trade Law and the GATT/WTO Dispute Settlement System (London, Kluwer Law International 1997) pp. 36–37.Google Scholar