Transcript No Slide Title

Antitrust/Competition Law
HOW THE WTO RESOLVES
TRADE DISPUTES
Presented by
Marie Kidwell, Partner
A PRESENTATION TO AQSIQ
12 NOVEMBER 2003
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INTRODUCTION
Antitrust/Competition
Law
1. WTO compared to GATT
2. What kinds of disputes?
3. Who can be a party to a dispute?
4. What the WTO dispute settlement system
consists of
5. China and the WTO dispute settlement
system
6. Conclusions
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WTO COMPARED
TO GATT
Antitrust/Competition
Law
 The Uruguay Round Agreements 1995
 Single greatest accomplishment of
Uruguay Round
 Vast Improvements – more structured
process
 301 trade disputes initiated in less than 9
years compared with 300 disputes initiated
under GATT during 50 years
 Faith and confidence in the system.
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WHAT KINDLaw
OF DISPUTES?
Antitrust/Competition
 Broken promises
 Supplemental or alternative dispute
settlement procedures (i.e. Appendix 2
DSU)
 Breach of obligation and/or nullification
and impairment of benefits
 Breach WTO Agreements
 Failure to live up to obligations
 Third party Member with a substantial
interest in a matter before a panel (Article
10 DSU).
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WHO CAN BE A PARTY
TO A DISPUTE?
Antitrust/Competition
Law
 WTO Member governments
 All groups with a stake in the outcome of
trade decisions through their governments
 Includes affected non-governmental and
transnational actors
 NB: Importance of lobbying governments
 Private individuals/entities have rights
under Article 4 of the Pre-Shipment
Inspection Agreement.
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WHAT DOES THE WTO DISPUTE
Antitrust/Competition
Law
SETTLEMENT SYSTEM
CONSIST OF?
 Political and Legal Methods
 Consultation (Articles 4 DSU)
 The panel process (Articles 3, 6, 7, 8, 10,
11, 13, 14, 15, 18, 19 and 20 DSU)
 Opportunity for appeal (Articles 16, 17
DSU)
 Implementing dispute decisions (Articles
21, 22 DSU)
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POLITICAL METHODS OF DISPUTE
Antitrust/Competition
Law
SETTLEMENT

Consultation (Article 4 DSU)

Good Offices (Articles 5, 24 DSU) sort of amiable
compositeur

Conciliation (Articles 5, 24 DSU)

Mediation (Articles 5, 24 DSU)

Recommendations by:
 Panels (Article 19 DSU)
 Appellate Body (Article 19, DSU)
 Dispute Settlement Body (Articles 16, 17 DSU)
cont…
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Antitrust/Competition Law
 Surveillance of Implementation of
Recommendations and Rulings (Article 21
DSU)
 Compensation and Suspension of
Concessions (Article 22 DSU)
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THE MAIN LEGAL METHODS OF
Antitrust/Competition
DISPUTELaw
SETTLEMENT
 Panel procedure (Articles 6-16 & 19 DSU)
 Appellate Review Procedure (Articles 17-19
DSU)
 Rulings by Dispute Settlement Body and
Panel and Appellate Body Reports (Articles
16, 17 DSU)
 Arbitration among states (Article 25 DSU)
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CONSULTATION
Antitrust/Competition
Law
 Looking for a mutually acceptable solution
to a problem
 Mandatory 60 day bilateral consultation
period
 Significant number of disputes settled or
diffused at this stage.
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PANELLaw
PROCESS
Antitrust/Competition
 Settling disputes is the responsibility of
the Dispute Settlement Body (DSB)
 NB: Must notify DSB about consultation
otherwise no panel
 Formal process
 Conducted by a neutral 3 person panel
 That makes binding decisions
 Under objective legal criteria
 Panels have detailed working procedures.
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Antitrust/Competition Law
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MULTIPLE CLAIMS
Antitrust/Competition
Law9 DSU)
(Article
 Where more than one Member requests the
establishment of a panel related to the
same matter, then a single panel may be
established (Article 9 DSU)
 Example: Shrimp-Turtle case: one panel
established to hear complaints of Malaysia,
Pakistan, Thailand and India.
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RIGHT TO SEEK INFORMATION
Antitrust/Competition
Law13 DSU)
(Article
 A panel has right to seek information and
technical advice from any individual or
body which it deems appropriate.
 Status of Amicus Curiae briefs?
 Examples: Shrimp-Turtle case; ECAsbestos case.
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Antitrust/Competition Law
 HOW DOES THE DISPUTE SETTLEMENT
BODY FIT WITHIN THE WTO STRUCTURE?
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THE OPPORTUNITY
FOR APPEAL
Antitrust/Competition
Law
 7 out of 10 panel reports to date have been
appealed
 Appeal is limited to issues of law covered
in the panel report and the legal
interpretation developed by the panel
 Appellate body has 7 Members – 3 sit at
any one time, although note the approach
of collegiality to ensure consistency
 Report of appellate body adopted by DSB
after 10 days.
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THE CURRENTLaw
SEVEN MEMBERS
Antitrust/Competition
 James (Jim) Bacchus (US national) –
Chairman of the Appellate Body (retires
from the AB at the end of 2003);
 Georges Abi-Saab (Egyptian);
 Luiz Olavo Baptista (Brazilian);
 Arumugamangalam Venkatachalam
Ganesan (Indian);
 John Lockart (Australia);
cont…
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Antitrust/Competition Law
 Giorgio Sacerdoti (Italy – the EU judge);
and
 Ysauhi Taneguchi (Japan)
 Question: When will there be a Chinese
Member on the Appellate Body?
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IMPLEMENTINGLaw
DISPUTE DECISIONS
Antitrust/Competition
 Losing “Defendant” to bring its policy into
line with the ruling or recommendations
 “Reasonable period of time”
 Trade sanctions
 Implementation of adopted
recommendations or ruling kept under
surveillance by the DSB
 Query the significance of national
objectives and regulatory regimes re
implementation of decisions – Example:
case re EU ban on hormones in beef.
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CHINA AND THE WTO DISPUTE
Antitrust/Competition
Law SYSTEM
SETTLEMENT
 Joined 11 December 2001
 Fourth largest trading body in the world
 China not yet joined as a respondent in any
disputes to date
 Complainant re legality of US steel tariffs
 Position as a third party in panel disputes.
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CONCLUSIONS
Antitrust/Competition
Law
 Effectiveness of system
 Also used by smaller and developing
countries
 Balance between use of a panel interfering
with a specific country’s trade policy and
hoping to increase trade
 Cancun: the importance of China’s role
 China to host next round of discussions in
2005.
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Antitrust/Competition Law
Thank you.
Marie Kidwell
Hunton & Williams, London
Beijing, China
12 November 2003
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