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The WTO’s Crisis: Between a Rock and a Hard Place

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European Yearbook of International Economic Law 2020

Part of the book series: European Yearbook of International Economic Law ((EUROYEAR,volume 11))

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Abstract

The perception of the World Trade Organization (WTO) is currently one of an organization in crisis. Yet, appraisal varies regarding its extent and seriousness: Is it merely a rough time or are we standing on the edge of destruction? The article will trace developments inside as well as outside of the WTO in order to assess the magnitude of the crisis. It will be argued that while certain developments inside the Organization, when seen in accumulation would already warrant serious attention, only together with developments taking place outside of the WTO, the two strands of developments unfold their full potential for the crisis. The overall situation renders the WTO in a difficult position, as it is currently unable to adapt to these challenges, while keeping calm and carrying on might similarly lead to its dissolution. While States might improve and further develop their trade relations in bi- and plurilateral agreements, it is only the WTO that reflects and stands for the multilateral post (cold) war order, which may be gradually fading in the years to come.

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Notes

  1. 1.

    Generally, reservations are not allowed according to Article XVI:5 of the Agreement Establishing the World Trade Agreement (WTO Agreement) 1994, 1867 UNTS 154, except if provided in the respective agreement (e.g. Articles 15.1. Technical Barriers to Trade Agreement (TBT Agreement), 18.2. Anti-Dumping Agreement (ADA), 32.2. of the WTO Agreement on Subsidies and Countervailing Measures 1994, 1867 UNTS 14 (SCM), 72 of the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights 1994 UNTS 299 (TRIPS), Annex III 2–4 Custom Valuation Agreement for developing countries, approval is required by the other members. Nevertheless, there is little actual relevance as can be inferred from the list of members’ reservations, Doc G/VAL/W/311.

  2. 2.

    Currently 164 members, see https://www.wto.org/english/thewto_e/whatis_e/tif_e/org6_e.htm (last accessed 10 June 2020).

  3. 3.

    DG Azevêdo mentioned in his statement on occasion of the 25th anniversary of the conclusion of the Uruguay Round on 12 September 2019; that “To date, the WTO has dealt with almost 600 trade disputes. Many disputes are resolved before they reach the litigation stage, but when they do proceed to that stage compliance with rulings is very high, at around 90 per cent.” See https://www.wto.org/english/news_e/spra_e/spra280_e.htm (last accessed 4 June 2020).

  4. 4.

    Dunoff (2019), p. 198.

  5. 5.

    Kurtz (2019), see https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3469496 (last accessed 4 June 2020), p. 3.

  6. 6.

    WTO, DG Azevêdo: We’re in danger of forgetting the lessons from Bretton Woods, 17 October 2019, https://www.wto.org/english/news_e/spra_e/spra287_e.htm (last accessed 4 June 2020).

  7. 7.

    World Trade Organization, Ministerial Declaration of 14 November 2001, WTO Doc. WT/MIN (01)/DEC/1. (Doha Declaration).

  8. 8.

    Borrowed from the famous statement by Louis Henkin that “[a]lmost all nations observe almost all principles of international law and almost all of their obligations almost all of the time”, Henkin (1979), p. 47.

  9. 9.

    Doha Declaration, para 2.

  10. 10.

    Id., e.g. Subsidies in agriculture (para. 13); market-access for non-agriculture products (para 16); interaction between trade and competition policy (para. 24); trade facilitation (para. 27); trade and transfer of technology (para. 37); technical cooperation and capacity building (paras 38–41); least-developed countries (paras. 42–43); special and differential treatment (para. 44); see also para 4 for the commitment to the WTO “as the unique forum for global trade rule-making”.

  11. 11.

    ICTSD, The Singapore Issues: Investment, Competition Policy, Transparency in Government Procurement and Trade Facilitation. 1 Doha Round Briefing Series 6, February 2003, https://www.iisd.org/sites/default/files/publications/wto_doha_singapore_issues.pdf (last accessed 1 October 2020).

  12. 12.

    Especially export subsidies are a major part of the broader package in the agriculture negotiations. Yet, the draft text for ministers to agree in Bali (that ended with the 2013 Bali Ministerial Declaration on Export Competition) stops short of making legal commitments. See https://www.wto.org/english/thewto_e/minist_e/mc9_e/brief_agneg_e.htm#generalservices (last accessed 10 June 2020) and https://www.wto.org/english/news_e/news13_e/agng_23may13_e.htm#export (last accessed 5 June 2020).

  13. 13.

    WTO, The WTO at Twenty: Challenges and achievements, September 2015, https://www.wto.org/english/res_e/booksp_e/wto_at_twenty_e.pdf (last accessed 1 October 2020), concludes that the WTO has achieved much over its first 20 years but the success of the WTO has inevitably given rise to new challenges.

  14. 14.

    Final Text in Decision of 27 November 2014, WT/L/940, the TFA is a Protocol to WTO Agreement.

  15. 15.

    After obtaining the two-thirds acceptance of the Agreement from its 164 Members.

  16. 16.

    See especially Articles 1 and 5 (Publication and availability of information) and Article 10 (Formalities connected with importation, exportation on transit) of the TFA.

  17. 17.

    Articles 13–22 Section II of the TFA.

  18. 18.

    See Lester (2016), p. 64 and Cho S, Is the WTO Passé? Exploring the Meaning of the Doha Debacle. 1 May 2009, http://ssrn.com/abstract=1403464 (last accessed 1 October 2020), p. 7.

  19. 19.

    See Matthews A, Food Security and WTO Domestic Support Disciplines post-Bali, ICTSD Programme on Agricultural Trade and Sustainable Development. ICTSD, 2014, http://ageconsearch.umn.edu/record/160370/files/01-Matthews%20-%20EAAE%20135.pdf (last accessed 1 October 2020), p. 4.

  20. 20.

    WTO, United States — Subsidies on Upland Cotton, WT/DS267.

  21. 21.

    The Cotton-4 (Benin, Burkina Faso, Chad and Mali). Anderson K and Valenzuela E, The World Trade Organization’s Doha Cotton Initiative: A Tale of Two Issues. World Bank, Policy Research Working Paper No. 3918, May 2006, http://documents.worldbank.org/curated/en/247241468010473451/pdf/wps3918.pdf (last accessed 1 October 2020); Ministerial Decision of Bali on Cotton (2013), reiterates members’ commitment to “on-going dialogue and engagement” to make progress in the negotiations on cotton according to the 2005 objectives of the Hong Kong Ministerial Conference (WT/MIN(13)/41 WT/L/916).

  22. 22.

    Work programmes on Fisheries (WT/MIN(17)/64), e-commerce (WT/MIN(17)65) and Small Economies (WT/MIN(17)/63) and a decision on the prolongation of TRIPS and non-violation complaints (WT/MIN(17)/66).

  23. 23.

    WT/MIN(17)/61 Joint Ministerial statement on services domestic regulation; WT/MIN(17)/60 Joint statement on Electronic Commerce WT/MIN(17)/59; Joint ministerial statement on Investment Facilitation for Development WT/MIN(17)/58; Joint Ministerial statement—Declaration on the establishment of a WTO informal work programme for MSMES.

  24. 24.

    See https://www.wto.org/english/thewto_e/whatis_e/tif_e/org6_e.htm (last accessed 31 May 2020).

  25. 25.

    See https://www.wto.org/english/tratop_e/ecom_e/ecom_e.htm (last accessed 31 May 2020) and also Meltzer J P, WTO reform agenda. Data flows and international regulatory cooperation. Brookings Institute, Working Paper No. 130, September 2019, https://www.brookings.edu/wp-content/uploads/2019/09/WTO-ReformAgenda_final.pdf (last accessed 1 October 2020) this stands in stark contrast to FTAs having regularly incorporated e-commerce chapters into their coverage; see e.g. Wu M, Digital trade-related provisions in regional trade agreements: existing models and lessons for the multilateral trade system. RTA Exchange, Overview Paper, November 2017, https://rtaexchange.org/pdf/Digital%20Trade%20Related%20Provisions%20in%20RTA_%20WU.pdf (last accessed 1 October 2020), p. 6.

  26. 26.

    General Agreement on Tariffs and Trade (GATT) 1994, 1867 UNTS 187; General Agreement on Trade in Services (GATS) 1994, 1869 UNTS 183.

  27. 27.

    In themselves problematic due to their open relationship with WTO. Yet, the negotiations on TISA are now on hold, see https://ec.europa.eu/trade/policy/in-focus/tisa/ (last accessed 2 June 2020).

  28. 28.

    See https://www.wto.org/english/tratop_e/envir_e/ega_e.htm (last accessed 5 June 2020).

  29. 29.

    Genest (2014), p. 10.

  30. 30.

    Negotiations on fisheries subsidies were launched in 2001 at the Doha Ministerial Conference, and at the eleventh Ministerial Conference held in Buenos Aires in 2017, WTO members agreed to conclude the agreement on fisheries subsidies which delivers on Sustainable Development Goal 14.6 by the end of 2019 (now postponed to be agreed in 2021 in Nur-Sultan).

  31. 31.

    See on this discussion Petersmann (2000), pp. 19–25.

  32. 32.

    Relation of currency and competition with trade; see further below US argument in WTO, United States — Tariff Measures on Certain Goods from China, WT/DS543, 27 August 2019.

  33. 33.

    WTO, United States — Tariff Measures on Certain Goods from China, WT/DS543, see https://www.wto.org/english/ratop_e/dispu_e/cases_e/ds543_e.htm (last accessed 10 June 2020).

  34. 34.

    “China’s policy and practice of state-sanctioned theft […] violates prevailing U.S. ‘standards of right and wrong’ as reflected in the state and federal laws of the United States, under which the act of ‘theft’ is universally deemed a criminal offense.”, US Written statement in WT/DS543, para. 74, see https://ustr.gov/sites/default/files/enforcement/DS/US.Sub1.%28DS543%29.fin.%28public%29.pdf (last accessed 1 October 2020).

  35. 35.

    Ibid., para. 76.

  36. 36.

    Increasingly covering those issues in bi- and plurilateral agreements, see Sect. 2.3.

  37. 37.

    Kelling and Wilson (1982): “Window-breaking does not necessarily occur on a large scale because some areas are inhabited by determined window-breakers whereas others are populated by window-lovers; rather, one unrepaired broken window is a signal that no one cares, and so breaking more windows costs nothing.”

  38. 38.

    See on the ADA in general https://www.wto.org/english/tratop_e/adp_e/adp_e.htm (last accessed 10 June 2020).

  39. 39.

    See Article VI GATT and ADA https://www.wto.org/english/tratop_e/adp_e/adp_info_e.htm (last accessed 10 June 2020).

  40. 40.

    “Market Economy”: Economy in which fundamentals of supply and demand provide signals regarding resource utilization, see Gregory and Stuart (2004), p. 538. On the contrary, a “state-driven or directed economy” can be defined as a model whereby the State is instrumental in guiding economic development, based on the rule of the market, see Che (2019).

  41. 41.

    A list of disputes citing the ADA can be found here: https://www.wto.org/english/tratop_e/dispu_e/dispu_agreements_index_e.htm?id=A6#selected_agreement (last accessed 1 October 2020).

  42. 42.

    Usually of developed countries against certain developing countries. See https://docs.wto.org/dol2fe/Pages/FE_Search/FE_S_S006.aspx?Query=(%20@Symbol=%20g/adp/d*)andLanguage=ENGLISHandContext=FomerScriptedSearchandlanguageUIChanged=true# (last accessed 9 June 2020).

  43. 43.

    See the database on https://www.wto.org/english/tratop_e/adp_e/adp_e.htm; https://www.wto.org/english/tratop_e/adp_e/AD_InitiationsByExpCty.pdf (last accessed 1 October 2020).

  44. 44.

    By mid-2019 a total of 5725 anti-dumping initiations since 1995 have been surveyed with an increasing tendency https://www.wto.org/english/tratop_e/adp_e/AD_InitiationsByExpCty.pdf (1 last accessed 1 October 2020).

  45. 45.

    In fact, 90% of products from China were subjected to anti-dumping or countervailing measures before 2019, see Bown C P, The 2018 US-China Trade Conflict After 40 Years of Special Protection. Peterson Institute for International Economics, Working Paper, April 2019, https://www.piie.com/system/files/documents/wp19-7.pdf (last accessed 1 October 2020), p. 16.

  46. 46.

    WT/L/432, Accession of the People’s Republic of China, Decision of 10 November 2001.

  47. 47.

    Huo (2002), p. 197.

  48. 48.

    There can only be speculation about the reasons for China’s suspension https://www.reuters.com/article/us-usa-china-wto-eu/china-pulls-wto-suit-over-claim-to-be-a-market-economy-idUSKCN1TI10A (last accessed 9 June 2020).

  49. 49.

    See Mavroidis and Prusa (2018), pp. 239–264.

  50. 50.

    Eckhaus (2006), pp. 1–13.

  51. 51.

    Except there are in conformity with the Agriculture Agreement or do not fulfil the requirements of either Articles 3 or 5 SCM.

  52. 52.

    Powell and Schmitz (2005), p. 289.

  53. 53.

    WTO, United States – Subsidies on Uplan Cotton, WT/DS267.

  54. 54.

    The text of the Memorandum of Understanding can be found here: https://ustr.gov/sites/default/files/20141001201606893.pdf (last accessed 15 October 2020); for an analysis see Guitchons (2015), Seventh Multi-year Expert Meeting on Commodities and Development, 15–16 April 2015, https://unctad.org/meetings/en/Presentation/SUC%20MYEM2015%20Andrei%20Guitchounts.pdf (last accessed 15 October 2020).

  55. 55.

    Bacchus et al., Disciplining China’s Trade Practices at the WTO: How WTO Complaints Can Help Make China More Market-Oriented. CATO Institute, Policy Analysis No. 856, 15 November 2018, https://www.cato.org/publications/policy-analysis/disciplining-chinas-trade-practices-wto-how-wto-complaints-can-help (last accessed 2 June 2020).

  56. 56.

    See China TRIPS Cases: WTO, China — Measures Affecting the Protection and Enforcement of Intellectual Property Rights, WT/DS362; WTO, China — Measures Affecting Financial Information Services and Foreign Financial Information Suppliers, WT/DS372; WTO, China — Measures Affecting the Protection of Intellectual Property Rights, WT/DS542; and WTO, China — Certain measures on the transfer of technology, WT/DS549.

  57. 57.

    The EC/EU stood as respondent in 96 cases and the US in 156 cases.

  58. 58.

    China has in fact quite a good record of implementing WTO reports for the 41 disputes that had been brought between 2004–2018, of which 27 had found WTO inconsistent measures, see Bacchus et al. Disciplining China’s Trade Practices at the WTO: How WTO Complaints Can Help Make China More Market-Oriented. CATO Institute, Policy Analysis No. 856, 15 November 2018, https://www.cato.org/publications/policy-analysis/disciplining-chinas-trade-practices-wto-how-wto-complaints-can-help (last accessed 2 June 2020); Zhou (2019).

  59. 59.

    See especially Sect. 2.3.

  60. 60.

    Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) 1994, 1869 UNTS 40.

  61. 61.

    Sacerdoti (2019), pp. 6–7.

  62. 62.

    So-called Section 301 dispute between US and China, WTO, United States — Tariff Measures on Certain Goods from China, WT/DS543.

  63. 63.

    Since 2015, latest development is a request for consultation by Korea, see WTO, Japan —Measures related to the Exportation of Products and Technology to Korea, WT/DS590 https://www.wto.org/english/tratop_e/dispu_e/cases_e/ds590_e.htm.

  64. 64.

    See WTO, United Arab Emirates — Measures Relating to Trade in Goods and Services, and Trade-Related Aspects of Intellectual Property Rights, WT/DS526.

  65. 65.

    Especially in the so called Steel and Aluminium cases, that have also been brought to the attention of the WTO in altogether 12 disputes: WTO, United States — Certain Measures on Steel and Aluminium Products; WT/DS544; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS548; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS550; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS551; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS552; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS554; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS556; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS564; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS547; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS556; WTO, Canada — Additional Duties on Certain Products from the United States, WT/DS557; WTO, European Union — Additional Duties on Certain Products from the United States, WT/DS559.

  66. 66.

    Please note that the defence by Japan for its measures is not yet, available and not yet predictable.

  67. 67.

    Cambridge Dictionary, “Pandora’s Box”.

  68. 68.

    Under the GATT 47 Article XXI (b) (3) became relevant in five disputes, see Analytical Index on Article XXI, pp. 602–605; under GATT 94 only in one panel report, namely Russia – Traffic in transit, the provision received broader discussion and was decisive for the outcome of the dispute, see Analytical Index GATT 1994—Article XXI (Jurisprudence), paras 10–14.

  69. 69.

    International Trade Organization at the time.

  70. 70.

    Second Session of the Preparatory Committee of the United Nations Conference on Trade and Employment, Verbatim Report, E/PC/T/A/PV/33 (July 24, 1947), 21 (US-41).

  71. 71.

    EPCT/A/PV/33, 20-1 and Corr.3.

  72. 72.

    WTO, Russia — Traffic in Transit, WT/DS512/R, para 2.1.

  73. 73.

    Ibid., para 7.56.

  74. 74.

    WTO, Russia — Traffic in Transit, First Executive Summary of the Arguments of the Russian Federation, WT/DS512/R/Add.1, para 47: “The Russian Federation is of the view that Article XXI (a) and (b) of the GATT is of a self-judging nature. Each of the WTO Members individually and without any external involvement determines what its essential security interests are and how to protect them. Other reading of this Article will result in interference in internal and external affairs of a sovereign state”.

  75. 75.

    WTO, Russia –Traffic in Transit – First Executive Summary of the Arguments of the Russian Federation, WT/DS512/R/Add.1, para 60.

  76. 76.

    WTO, United States — Certain Measures on Steel and Aluminium Products; WT/DS544; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS548; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS550; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS551; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS552; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS554; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS556; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS564; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS547; WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS556; WTO, Canada — Additional Duties on Certain Products from the United States, WT/DS557; WTO, European Union — Additional Duties on Certain Products from the United States, WT/DS559.

  77. 77.

    WTO, United Arab Emirates — Measures Relating to Trade in Goods and Services, and Trade-Related Aspects of Intellectual Property Rights, WT/DS526.

  78. 78.

    WTO, United States — Certain Measures on Steel and Aluminium Products, WT/DS552, US Written Statement, paras. 129–179.

  79. 79.

    Please see fn. 76.

  80. 80.

    WTO, United States — Certain Measures on Steel and Aluminium Products, US Written Statement, WT/DS552.

  81. 81.

    Namely Decision concerning Article XXI of the General Agreement, L/5426, see ibid, p. 6.

  82. 82.

    WTO, Russia — Traffic in Transit, Report of the Panel, WT/DS512/R, 7.68.

  83. 83.

    See Sect. 2.2.

  84. 84.

    Statements Delivered to the General Council by Ambassador Dennis Shea U.S. Permanent Representative to the World Trade Organization, see https://geneva.usmission.gov/2019/10/15/statements-by-the-united-states-at-the-wto-general-council-meeting/ (last accessed 10 June 2020).

  85. 85.

    The panel followed the Russia — Traffic in Transit interpretation with regard to Article 73 TRIPS, WTO, Saudi Arabia — Measures concerning the Protection of Intellectual Property Rights, Report of the Panel, WT/DS567/R.

  86. 86.

    See WTO, United States — Certain Measures on Steel and Aluminium Products, US Written Statement, WT/DS552, https://ustr.gov/sites/default/files/enforcement/DS/US.Sub1.%28DS548%29.fin.%28public%29.pdf, paras. 129–179.

  87. 87.

    See WTO, Russia – Traffic in transit- US Third Party Statement, WT/DS512/R/Add.1, 106.

  88. 88.

    Decision concerning Article XXI of the General Agreement, L/5426.

  89. 89.

    WTO, Russia –Traffic in Transit – Report of the Panel, WT/DS512/R/Add.1, 82.

  90. 90.

    Ibid., e.g. Australia, 69; Brazil, 73; Canada, 76; EU, 84; Japan, 89; Singapore, 99.

  91. 91.

    E.g. Australia, 72; Turkey, 103; to a lesser extent Brazil.

  92. 92.

    The written Statement by the United Arab Emirates (UAE) is not yet available, but it can be expected that UAE will bring forward a similar argument, see WTO, United Arab Emirates — Measures Relating to Trade in Goods and Services, and Trade-Related Aspects of Intellectual Property Rights, WT/DS526.

  93. 93.

    The text of Article XXI lit. b GATT reads: “(i) relating to fissionable materials or the materials from which they are derived; (ii) relating to the traffic in arms, ammunition and implements of war and to such traffic in other goods and materials as is carried on directly or indirectly for the purpose of supplying a military establishment; (iii) taken in time of war or other emergency in international relations”.

  94. 94.

    Voon argues that “…the security exception lies at the center of multiple explosive disputes, posing a potential threat to the WTO’s very existence.” Voon (2019), p. 45.

  95. 95.

    WTO, United States — Tariff Measures on Certain Goods from China, US Written Statement, WT/DS543.

  96. 96.

    Ibid., para 9.

  97. 97.

    Ibid., para. 10.

  98. 98.

    It has been argued that forced technology transfer could be partially covered by Article 39 TRIPS, see Bacchus et al. Disciplining China’s Trade Practices at the WTO: How WTO Complaints Can Help Make China More Market-Oriented. CATO Institute, Policy Analysis No. 856, 15 November 2018, https://www.cato.org/publications/policy-analysis/disciplining-chinas-trade-practices-wto-how-wto-complaints-can-help (last accessed 2 June 2020).

  99. 99.

    WTO, United States — Tariff Measures on Certain Goods from China, US Written Statement, WT/DS543, paras. 9–10.

  100. 100.

    Pauwelyn (2019a), p. 535.

  101. 101.

    Ibid., p. 538.

  102. 102.

    See Sect. 2.3.

  103. 103.

    See the schedules of concessions of each member here: https://www.wto.org/english/tratop_e/schedules_e/goods_schedules_table_e.htm (last accessed 10 June 2020).

  104. 104.

    According to the DSU included in Annex 2 of the WTO Agreement.

  105. 105.

    Articles 4, 6, 12, and 22 (especially 22.2) DSU.

  106. 106.

    Especially Article 49 Responsibility of States for internationally wrongful Acts, GA/RES 56/83, Annex.

  107. 107.

    If, within 20 days after the expiry of the reasonable period of time, the parties have not agreed, the complainant may ask the DSB for permission to impose trade sanctions against the respondent that has failed to implement. Technically, this is called “suspending concessions or other obligations under the covered agreements” (Article 22.2 of the DSU). Concessions are, for example, tariff reduction commitments.

  108. 108.

    Brewster (2019), pp. 62–63.

  109. 109.

    For example, the US patiently awaited the required decisions in WTO, European Communities — Measures Concerning Meat and Meat Products (Hormones), WT/DS26, to retaliate against the WTO-inconsistent import prohibition of hormone treated beef from the US. See Brewster (2019), pp. 62–63.

  110. 110.

    The EU justifies these additional duties by relying on the Safeguards Agreement (Articles 8.2 and 8.3) while the USA has not itself officially qualified their measures as falling under the Safeguards Agreement, WT/DS559, EU written statement, see https://trade.ec.europa.eu/doclib/docs/2019/october/tradoc_158389.pdf.

  111. 111.

    See reactions of EU and China, https://edition.cnn.com/2019/07/02/economy/us-tariffs-on-eu/index.html (last accessed 13 June 2020) and https://fortune.com/2019/10/08/trump-china-tariffs-trade-war-us-economy-impact/ (last accessed 13 June 2020).

  112. 112.

    Lamp (2019), p. 7.

  113. 113.

    See e.g. the Alliance for Multilateralism, https://new-york-un.diplo.de/un-en/news-corner/alliance-multilateralism/2250628 (last accessed 13 June 2020).

  114. 114.

    Brewster (2019), pp. 62–63.

  115. 115.

    US Written statement in WT/DS543, p. 14 see https://ustr.gov/sites/default/files/enforcement/DS/US.Sub1.%28DS543%29.fin.%28public%29.pdf (last visited 15 October 2020).

  116. 116.

    See also Bäumler (2019), marginal note 216.

  117. 117.

    Reich (2019), p. 1.

  118. 118.

    See on the functioning of the Dispute Settlement system, Van den Bossche and Zdouc (2017), p. 156.

  119. 119.

    E.g. WTO, United States — Measures Affecting the Cross-Border Supply of Gambling and Betting Services (Complainant Antigua and Barbuda), WT/DS285.

  120. 120.

    Cho S, Is the WTO Passé? Exploring the Meaning of the Doha Debacle. 1 May 2009, http://ssrn.com/abstract=1403464 (last accessed 1 October 2020), p. 7.

  121. 121.

    Fabry and Tate (2018), p. 6.

  122. 122.

    Petersmann (2018), p. 2.

  123. 123.

    Fabry and Tate (2018), p. 7.

  124. 124.

    See Rule 15 Working Procedures for Appellate Review, WT/AB/WP/6.

  125. 125.

    Statements by the United States at the WTO General Council Meeting on 15 October 2019 https://geneva.usmission.gov/2019/10/15/statements-by-the-united-states-at-the-wto-general-council-meeting/ (last accessed 13 June 2020).

  126. 126.

    Article 17 of the DSU.

  127. 127.

    Statement by the United States at the WTO General Council Meeting on 15 October 2019.

  128. 128.

    Pauwelyn J and Pelc K, Who Writes the Rulings of the World Trade Organization? A Critical Assessment of the Role of the Secretariat in WTO Dispute Settlement. 26 September 2019, https://ssrn.com/abstract=3458872 (last accessed 15 October 2020).

  129. 129.

    See e.g. WTO, United States — Measures Concerning the Importation, Marketing and Sale of Tuna and Tuna Products, WT/DS381; WTO, Canada — Measures Relating to the Feed-in Tariff Program, WT/DS426; WTO, European Communities — Measures Affecting Asbestos and Products Containing Asbestos, WT/DS135; WTO, United States — Import Prohibition of Certain Shrimp and Shrimp Products, WT/DS58/DS61; GATT, United States — Restrictions on Imports of Tuna, (Not adopted, circulated on 3 September 1991) and GATT, United States — Prohibition of Imports of Tuna and Tuna Products from Canada (Panel finding adopted on 22 February 1982).

  130. 130.

    WTO, Canada – Measures Relating to the Feed-in tariff Program, WT/DS426.

  131. 131.

    Lehne (2019), 10 November 2019, https://ielp.worldtradelaw.net/2019/11/guest-post-is-the-blocking-of-appointments-to-the-wto-appellate-body-by-the-united-states-legally-ju.html (last accessed 13 June 2020).

  132. 132.

    Ibid.

  133. 133.

    E.g. the European Union, China, Canada, India, Norway, New Zealand, Switzerland, Australia, Republic of Korea, Iceland, Singapore and Mexico raised concerns with the AB’s approach to treat its own reports effectively as precedent that panels are to follow absent “cogent reasons” (WT/GC/W/752); see also Brewster (2011), p. 102.

  134. 134.

    Petersmann (2018), p. 8.

  135. 135.

    Petersmann (2018), p. 8.; of course, this suggestion is in light of the footnote to Article IX WTO Agreement, providing that the rule of Article 2 para 4 DSU requiring consensus regarding any decision taken by the DSB, not undisputed. Yet, Petersmann rightly points out that the obligation to maintain the AB might render a reference to majority voting possible. In support also Gao (2019), pp. 20–21; Hillman (2018) Institute of International Economic Law Georgetown University Law Center 12 October 2018, https://www.law.georgetown.edu/wp-content/uploads/2018/12/Hillman-Good-Bad-Ugly-Fix-to-WTO-AB.pdf (last accessed 15 October 2020), p. 11.

  136. 136.

    Fiorini et al., WTO Dispute Settlement and the Appellate Body Crisis: Insider Perceptions and Members’ Revealed Preferences. Bertelsmann Stiftung, Dispute Settlement Survey, 2019, https://www.bertelsmann-stiftung.de/fileadmin/files/BSt/Publikationen/GrauePublikationen/MT_WTO_Dispute_Settlement_and_the_Appellate_Body_Crisis_Survey.pdf (last visited 15 October 2020), p. 19ff.

  137. 137.

    The declaration of the EU and 16 members can be found here: https://ec.europa.eu/commission/presscorner/detail/en/IP_20_113 (last accessed 13 June 2020).

  138. 138.

    Benin was the last member to join on 29 June 2020, see WT Doc. JOB/DSB/1/Add.12/Suppl.

  139. 139.

    See para. 1 and 2 of the MPIA Agreement, JOB/DSB/1/Add.1.

  140. 140.

    So far in four disputes the new mechanism will be used, WTO, Canada – Sale of Wine, WT/DS537; WTO, Costa Rica – Avocados, WT/DS524; WTO, Canada – Aircraft, WT/DS522; WTO, Colombia – AD Duties on French Fries, WT/DS591.

  141. 141.

    For the pool of arbitrators, see WT Doc. JOB/DSB/1/Add.12/Suppl.5.

  142. 142.

    Pauwelyn (2019b), pp. 303–309.

  143. 143.

    The US has in fact notified the DSB of an appeal on 18 December 2019 of the panel report in WTO, United States — Countervailing Duty Measure on Certain Hot-Rolled Carbon Steel Flat Products from India: Recourse to art 21.5 DSU by India, WT/DS436/RW, see WT/DS436/21; that communication was followed by another joint communication by India and the US the legal meaning of which is however unclear, see WT/DS436/22.

  144. 144.

    The term was first used by Bhagwati (1995).

  145. 145.

    Article XXIV: 4 GATT: “The contracting parties recognize the desirability of increasing freedom of trade by the development, through voluntary agreements, of closer integration between the economies of the countries parties to such agreements. They also recognize that the purpose of a customs union or of a free-trade area should be to facilitate trade between the constituent territories and not to raise barriers to the trade of other contracting parties with such territories”.

  146. 146.

    WTO discussion paper, “RTAs and the WTO: A troublesome relationship”, p. 26. https://www.wto.org/english/res_e/booksp_e/discussion_papers12b_e.pdf (last accessed 15 October 2020).

  147. 147.

    See on the interpretation of Article XXIV GATT, Analytical Index, Article XXI GATT https://www.wto.org/english/res_e/publications_e/ai17_e/gatt1994_art24_jur.pdf (last accessed 15 October 2020); see also Hilpold (2003); Mathis (2002), pp. 39 ff.

  148. 148.

    WTO, Regional Trade Agreements https://www.wto.org/english/tratop_e/region_e/region_e.htm (last accessed 14 June 2020).

  149. 149.

    See WTO database of RTAs http://rtais.wto.org/UI/publicPreDefRepByCountry.aspx (last accessed 14 June 2020).

  150. 150.

    World Tariff Profiles, publication by WTO, ITC and UNCTAD (2019).

  151. 151.

    On the disputed aspects of Article XXIV GATT see generally Van den Bossche and Zdouc (2017), pp. 648–672.

  152. 152.

    Not even in Turkey – Restrictions on Imports of Textile and Clothing, WT/DS34.

  153. 153.

    Equivalent in Article V GATS.

  154. 154.

    Lester (2019b), 7 October 2019, https://ielp.worldtradelaw.net/2019/10/the-us-japan-trade-deal-can-a-political-agreement-liberalize-trade-without-institutions.html (last accessed 14 June 2020).

  155. 155.

    “‘US-China trade deal totally done’, Trump aide Lighthizer says”. The Guardian, 15 December 2019, see https://www.theguardian.com/us-news/2019/dec/15/us-china-trade-deal-trump-lighthizer (last accessed 15 October 2020).

  156. 156.

    See http://www.europarl.europa.eu/legislative-train/theme-a-balanced-and-progressive-trade-policy-to-harness-globalisation/file-eu-us-trade-talks (last accessed 14 June 2020).

  157. 157.

    Especially an RTA shall not raise trade barriers for third parties, Article XXIV:4 GATT, see WTO, Turkey — Restrictions on Imports of Textile and Clothing Products- Appellate Body Report, WT/DS34/11, 25 February 2000, para 57.

  158. 158.

    Of course, for anti-dumping and anti-circumvailing measures the origin is similarly of concern, see e.g. the results of the Committee on Anti-Dumping Practices—Informal Group on Anti-Circumvention—Meeting of 25 October 2017, where some members raised concerns in specific anti-dumping actions listed in semi-annual notifications.

  159. 159.

    See on rules of Origin https://www.wto.org/english/docs_e/legal_e/22-roo_e.htm (last accessed 14 June 2020).

  160. 160.

    Bhagwati (2008), p. 32.

  161. 161.

    See e.g. the table of contents of the Comprehensive and Economic Trade Agreement (CETA) https://ec.europa.eu/trade/policy/in-focus/ceta/ceta-chapter-by-chapter/ (last accessed 14 June 2020).

  162. 162.

    On these terms: Qin (2010) and Ruta M, Preferential Trade Agreements and Global Value Chains Theory, Evidence, and Open Questions. World Bank, Policy Research Working Paper No. 8190, September 2017, http://documents.worldbank.org/curated/en/991871505132824059/Preferential-trade-agreements-and-global-value-chains-theory-evidence-and-open-questions (last visited 15 October 2020).

  163. 163.

    Horn et al. (2009), p. 4.

  164. 164.

    Ruta (2017).

  165. 165.

    According to WTO, Appellate Body Report, Peru–Agricultural Products, WT/DS457, para 5.112, it does not seem to be the case.

  166. 166.

    See especially WTO, Mexico — Tax Measures on Soft Drinks and Other Beverages, WT/DS308 and WTO, Peru — Additional Duty on Imports of Certain Agricultural Products, WT/DS457.

  167. 167.

    Vidigal (2019), pp. 187–188.

  168. 168.

    Especially Article 11.1(b) Safeguards Agreement, Vidigal (2019), pp. 196ff.

  169. 169.

    Vidigal (2019), pp. 191–192.

  170. 170.

    Especially argued with regard to TRIPS: Taubman (2019).

  171. 171.

    Although many aspects are still left to the discretion of members.

  172. 172.

    Condon B J, To Dystopia and Beyond: The WTO in a Warming Megaregional World. Paradise Lost or Found? The Post-WTO International Legal Order (Utopian & Dystopian Possibilities), Fletcher School, Tufts University, 7 May 2019, see https://ssrn.com/abstract=3384248 (last visited 15 October 2020).

  173. 173.

    EU-Singapore and EU-Vietnam FTA (Sustainable development provisions), EU-Mexico Global Agreement (Environment provisions), EU-South Korea FTA (Labour provisions), EU-Chile FTA (Competition provision), United States-Mexico-Canada Agreement (Currency provisions).

  174. 174.

    See e.g. CETA, the proposed chapters for the EU-Mercosur agreement or the negotiations on the Regional Comprehensive Economic Partnership.

  175. 175.

    Jinnah (2011), p. 191.

  176. 176.

    Explicitly for the US and EU: Horn et al. (2009), p. 2.

  177. 177.

    Glossary Term WTO: “African, Caribbean and Pacific countries. Group of countries with preferential trading relations with the EU under the former Lomé Treaty now called the Cotonou Agreement”.

  178. 178.

    Cho S, Is the WTO Passé? Exploring the Meaning of the Doha Debacle, 1 May 2009, http://ssrn.com/abstract=1403464 (last accessed 1 October 2020), p. 32.

  179. 179.

    See already Axelrod and Keohane (1985), p. 239.

  180. 180.

    Krieger et al. (2019), p. 18.

  181. 181.

    Krieger et al. (2019), p. 20.

  182. 182.

    See e.g. Condon and Sinha (2014).

  183. 183.

    See on systemic integration McLachlan (2019), pp. 279–320.

  184. 184.

    Preeg (2012), p. 1978.

  185. 185.

    For a very critical assessment of the global international economic law framework see Slobodian (2018), passim.

  186. 186.

    Osakwe (2015), p. 5.

  187. 187.

    Gray (2018), p. 2.

  188. 188.

    See supra Sect. 2.4.

  189. 189.

    Sohn (1975) and Zemora (1980).

  190. 190.

    Zemora (1980), p. 574.

  191. 191.

    Petersmann (2018), p. 8.

  192. 192.

    Possible at any time with a 6 months’ notice, Article XV WTO Agreement.

  193. 193.

    If no other voting mechanism is provided for in the agreements, Article IX:1 2 WTO Agreement.

  194. 194.

    Lester (2019a), 17 June 2019, https://ssrn.com/abstract=3405637 (last accessed 15 October 2020).

  195. 195.

    Ral Donner—You Don’t Know What You’ve Got (Until You Lose It) (1961).

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Bäumler, J. (2020). The WTO’s Crisis: Between a Rock and a Hard Place. In: Bungenberg, M., Krajewski, M., Tams, C.J., Terhechte, J.P., Ziegler, A.R. (eds) European Yearbook of International Economic Law 2020. European Yearbook of International Economic Law, vol 11. Springer, Cham. https://doi.org/10.1007/8165_2020_60

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