The effectiveness of the Dispute Settlement Body of the World Trade Organization

Abstract

This article analyses the performance of the Dispute Settlement Body of World Trade Organization, between 1995 and 2007. This organ is one of the most important fora for conflict resolution today, because the number of cases, states and amounts in dispute. I intend to study the fulfillment of proceedings; the originality of the mechanisms to induce compliance; the progressive legitimacy of the whole system and the main suggestions to reform it. Palavras-chaves: Organização Mundial do Comércio; órgão de solução de controvérsias; efetividade.

The Recent Crisis of the WTO Appellate Body: Is the WTO’s Reform a Solution?

“…Only the victorious parties of a same-sector dispute engage in retaliation. The possibility of retaliation has an immediate effect on contracts and causes losses for the party subjected to retaliation because the goods (Varella, 2009), as dispute-objected, subsequently grow so costly. Then, sales are hindered and the domestic markets are lost.…”

“…In the new procedure, all members must vote against the report to prevent its implementation (negative consensus). In the GATT's prior dispute resolution mechanism, all members were required to approve a report before the adoption (positive consensus) (Varella, 2009). The disagreement seldom reached the point of commercial retaliation under the previous GATT because the injured parties prevented it from being authorized.…”

“…Fourth, the WTO continues to develop and is characterized by strict interpretation on the WTO treaties. Considering the legitimacy and the states' preference for the DSB over other alternatives, it is intriguing to observe that the states prefer the organization over others (Varella, 2009). Although there are international laws and some of them can be used in the case of trade, the WTO remains to exercise power over other law subsystems.…”

“…The punishment can result in more significant reprisal only in severe circumstances (John H. Jackson, 2011). According to the WTO system, compliance depends on the dissatisfaction of the affected trade stakeholders that force a government to take action to alter the WTO decision into the national legislation, not the national court system (Varella, 2009). Thus, the WTO rules is higher in the hierarchy than the other trade treaties.…”

Is Compliance the Name of the Effectiveness Game? Goal-Shifting and the Dynamics of Judicial Effectiveness at the WTO

“…This focus has been especially conspicuous in the literature on the effectiveness of the World Trade Organization (WTO) dispute settlement system (DSS), as it edged away from its diplomatic orientation under GATT toward a more legalized one with the formation of the WTO. Thus, the effectiveness of the WTO DSS has often been assessed against the benchmark of WTO Member compliance with DSS rulings (see, e.g., Wilson, 2007; McRae, 2008; Davey, 2005; Horlick and Coleman, 2008; Lee, 2011; Davey, 2009; Epstein et al , 2009; Varella, 2009; Posner and Yoo, 2005: 46–50), understood as ‘a causal relationship between judicial decisions and state practice, leading to a convergence of the two’ (Shany, 2012a: 261).…”