Caribbean Trade Law and Development

Tag: Appellate Body

  • Several WTO Members agree on interim appeal arrangement for dispute settlement

    Several WTO Members agree on interim appeal arrangement for dispute settlement

    Alicia Nicholls

    On March 27, 2020, several Members of the World Trade Organization (WTO) agreed on a stop gap measure to ensure the continuation of a two-step system for the peaceful and orderly settlement of trade disputes amongst them at the WTO.

    Readers would recall that in December 2019 the WTO Appellate Body lost the quorum needed for hearing new appeals from panel reports and is no longer functioning. It is the sad culmination of the US’ blockage of appointments/re-appointments to the normally seven-member body in protest over alleged judicial overreach.

    What’s the Multiparty Interim Appeal Arbitration Arrangement?

    The new temporary arrangement agreed on today, known as the Multiparty Interim Appeal Arbitration Arrangement (MPIA), is based on Article 25 of the WTO’s Dispute Settlement Understanding. The MPIA will be based on the substantive and procedural aspects of the Appellate Body. Any Member may join the MPIA upon notification of endorsement of the communication to the Dispute Settlement Body. The arrangement will be in place as long as the Appellate Body remains defunct.

    This interim appeal initiative, which was spearheaded by the EU, is further to a statement which was made on January 4, 2020 at Davos in which the EU and then sixteen other WTO Members agreed to work on such an arrangement.

    Who’s already in?

    In addition to the EU, the fifteen other WTO Members which have already signed on are: Australia; Brazil; Canada; China; Chile; Colombia; Costa Rica; Guatemala; Hong Kong, China; Mexico; New Zealand; Norway; Singapore; Switzerland; and Uruguay. No Caribbean country has signed on as yet.

    For further information

    The Ministerial Statement may be accessed here.

    The full text of the Multiparty Interim Appeal Arbitration Arrangement may be read here.

    Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international trade and development consultant. You can also read more of her commentaries at www.caribbeantradelaw.com and follow her on Twitter @LicyLaw.

    DISCLAIMER: All views expressed herein are her personal views and do not necessarily reflect the views of any institution or entity with which she may be affiliated from time to time.

  • USTR releases report reiterating critiques of defunct WTO Appellate Body

    USTR releases report reiterating critiques of defunct WTO Appellate Body

    Alicia Nicholls

    Any doubts on whether the United States (US) would eventually shift its stance on the now defunct World Trade Organization (WTO) Appellate Body (AB) have been quashed with the release of a report by the Office of the United States Trade Representative (USTR) reiterating the US’ longstanding grievances with the AB.

    The crux of the report may be obtained from the following paragraph:

    “the Appellate Body has repeatedly failed to apply the rules of the
    WTO agreements in a manner that adheres to the text of those agreements, as negotiated and
    agreed by WTO Members. The Appellate Body has strayed far from the limited role that WTO
    Members assigned to it, ignoring the text of the WTO agreements. Through this persistent
    overreaching, the Appellate Body has increased its own power and seized from sovereign nations
    and other WTO Members authority that it was not provided.

    The report may be accessed here.

  • WTO Appellate Body loses quorum for hearing new appeals

    WTO Appellate Body loses quorum for hearing new appeals

    Alicia Nicholls

    The World Trade Organisation’s Appellate Body – the highest arbiter of trade disputes – has lost its quorum. The terms of two of its three remaining Members expired on December 10, 2019. This means that as of December 11, the Appellate Body is no longer be able to review new appeals of panel decisions as it now lacks the minimum number of members required to do so.

    It is a day which many who have been following global trade matters have feared. For the past two years, the US has been blocking the appointment of Appellate Body members unless its concerns related to the substantive and procedural aspects of the Appellate Body’s work were addressed. Successive US administrations have raised issues with the Appellate Body, but anti-WTO sentiment intensified under the Trump Administration which has repeatedly accused the WTO of being “unfair” to the US.

    In a press conference delivered at the final WTO General Council Meeting for 2019, WTO Director-General Roberto Azevedo stated that WTO Members could not achieve consensus on a draft decision to reform the Appellate Body submitted by Ambassador David Walker of New Zealand. Ambassador Walker had been appointed earlier this year to facilitate an informal process to overcome the deadlock on Appellate Body member appointments. The draft decision was an outcome of that process.

    Mr. Azevedo emphasised that the current paralysis of the Appellate Body “does not mean that rules-based dispute settlement has stopped at the WTO”. He pointed to other mechanisms under the DSB for resolving disputes. However, he noted that most Members prefer the two-tiered system and that he would launch “more intensive, high-level consultations on how to resolve the longstanding impasse over the appointment of Appellate Body members”.

    A group of 54 mainly developing WTO members, including many Caribbean countries, released a statement in support of the rules-based multilateral trading system. Inter alia, they called the dispute settlement system of the WTO “a central element in providing security and predictability to the multilateral trading system”. They also stressed the urgency “of filling all current vacancies on the Appellate Body”.

    During the General Council Meeting held December 9-11, Members finally approved the WTO’s 2020 Budget. Members also agreed to extend the moratorium on customs duties on electronic transmissions and the initiation of “non-violation” complaints under the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).

    UPDATE: It has been reported that the two outgoing Appellate Body members will stay on temporarily to complete some existing appeals. 

    To watch the WTO DG’s press conference, please click here.

    Alicia Nicholls, B.Sc., M.Sc., LL.B., is an international trade and development consultant with a keen interest in sustainable development, international law and trade. You can also read more of her commentaries and follow her on Twitter @LicyLaw.

    DISCLAIMER: All views expressed herein are her personal views and do not necessarily reflect the views of any institution or entity with which she may be affiliated from time to time.

  • Why the WTO Appellate Body Crisis Matters to the Caribbean

    Why the WTO Appellate Body Crisis Matters to the Caribbean

    Dr. Jan Yves Remy and Alicia Nicholls, SRC

    The Appellate Body (AB) of the World Trade Organization (WTO) – the final court charged with hearing appeals on points of law at the WTO – faces an existential crisis. On 10 December  2019, the terms of two of its remaining three members – the quorum needed to adjudicate an appeal – will expire. Their positions will not be filled if the current United States (US) blockage of appointments continues. This means that new appeals of panel decisions will not be heard after that date.  

    Given Caribbean countries’ limited and ‘checkered’ experience with the WTO dispute settlement (DS) system, it is tempting for the region to be blasé about the current impasse. However, as has been chronicled elsewhere, it is the smallest WTO Members that most need a functioning legal DS system to safeguard their interests when the powerful break the rules.

    In this latest SRC Trading Thoughts, we examine the possible “doomsday” scenario impending at the WTO and explain why Caribbean countries should be concerned by what portends if the AB no longer exists at the WTO.

    Read the full article here.