The Law and Policy of the World Trade Organization Text, Cases and Materials

As discussed in Chapter 1, the WTO agreements provide for many wide-ranging and broadly formulated rules concerning international trade in goods, trade in services and trade-related aspects of intellectual property rights. In view of the importance of their impact, economic and otherwise, it is not surprising that WTO Members do not always agree on the correct interpretation and application of these rules. In fact, Members frequently argue about whether or not a particular law or practice constitutes a violation of a right or obligation provided for in a WTO agreement. The WTO has a remarkable system to settle disputes between WTO Members concerning their rights and obligations under the WTO agreements. As mentioned in Chapter 2, dispute settlement is one of the core functions of the WTO.

The WTO dispute settlement system has been operational for more than two decades now. In that period, it has arguably been the most prolific of all international State-to-State dispute settlement systems. Between 1 January 1995 and 1 October 2016, a total of 566 disputes were brought to the WTO for resolution. In more than one-fifth of these disputes, the parties were able to reach an amicable solution through consultations, or the dispute was otherwise resolved without recourse to adjudication. In other disputes, parties have resorted to adjudication. Between 1 January 1995 and 1 October 2016, such adjudication resulted in 202 reports of dispute settlement panels and 127 reports of the Appellate Body. During the same period, the International Court of Justice (ICJ) in The Hague rendered 65 judgments and advisory opinions, and the International Tribunal for the Law of the Sea (ITLOS) in Hamburg rendered 12 judgments and advisory opinions and issued orders in another 11 cases. Also in comparison to its ‘predecessor’, the GATT dispute settlement system, the WTO dispute settlement system has obviously been very active. During the forty-seven years that the GATT dispute settlement system was operational (from 1948 to 1994), only 132 GATT dispute settlement reports were issued. Most importantly, however, in more than eight out of ten disputes in which the respondent had to withdraw (or modify) a WTO-inconsistent measure, it has done so.

The WTO dispute settlement system has been used by developed-country Members and developing-country Members alike.