WTO Dispute Settlement at Ten: Evolution, Experiences, and Evaluation

ENGLISH ABSTRACT: On 1 January 1995, the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) entered into force. During its first ten years, the DSU has since been applied to 324 complaints – more cases than dispute settlement under the GATT 1947 had dealt with in nearly five decades. The system is perceived, both by practitioners and in academic literature, to work generally well. However, it has also revealed some flaws. Negotiations to review and reform the DSU have been taking place since 1997 (“DSU review”), however, without yielding any result so far. In the meantime, WTO Members and adjudicating bodies managed to develop the system further through evolving practice. While this approach may remedy some practical shortcomings of the DSU text, the more profound imbalance between relatively efficient judicial decisionmaking in the WTO (as incorporated in the DSU) and nearly blocked political decisionmaking evolves into a serious challenge to the sustainability of the system. This article provides an overview of the first ten years of DSU practice, the on- going DSU review negotiations, and the challenges to the dispute settlement system. GERMAN ABSTRACT: Am 1. Januar 1995 trat das Übereinkommen über Regeln und Verfahren für die Streitschlichtung (Dispute Settlement Understanding; DSU) als Teil des WTO-Abkommens in Kraft. In den ersten zehn Jahren seines Bestehens fand das DSU auf 324 Klagebegehren Anwendung – mehr Fälle, als unter den Streitschlichtungsregeln des GATT 1947 in dessen nahezu fünfzigjähriger Geschichte behandelt wurden. Die Funktionsweise des Systems wird sowohl in der handelspolitischen Praxis als auch in der wissenschaftlichen Literatur als gut eingestuft. Gleichwohl hat der Mechanismus in seiner Anwendung auch einige Schwächen offenbart. Diese sollen auf dem Verhandlungswege („DSU Review“) behoben werden, doch blieben die seit Ende 1997 laufenden Gespräche bislang erfolglos. Zugleich ist es den Mitgliedstaaten und den Spruchorganen aber stellenweise gelungen, das System im Rahmen der praktischen Anwendung fortzuentwickeln. Während auf diesem Weg einige praktische Probleme des Verfahrenstextes behoben werden konnten, dürfte das beträchtliche Ungleichgewicht in der WTO zwischen einem vergleichsweise effizienten juristischen Entscheidungsmechanismus (in Form des DSU) und den häufig blockierten politischen Entscheidungsmechanismen fortbestehen. Dieses Ungleichgewicht bedroht die Systemnachhaltigkeit. Der vorliegende Artikel gibt einen Überblick über die ersten zehn Jahre DSU-Praxis, die laufenden DSU-Review-Verhandlungen sowie einen Ausblick auf zukünftige Herausforderungen.WTO, Dispute Settlement, DSU Review Negotiations

The Challenge of Reforming the WTO Dispute Settlement Understanding

The May 2003 deadline for the completion of the negotiations on improvements and clarifications of the Dispute Settlement Understanding (DSU) under the Doha Mandate has not been met. However, Members agreed in July 2003 to extend the deadline for the review until the end of May 2004. This article briefly summarises the past six years of negotiations on the DSU review, the most contentious issues and the systemic difficulties of the negotiations. We conclude with prospects for the forthcoming negotiations until 2004.WTO Dispute Settlement Understanding DSU Review

Gewährleisten umgesetzte WTO-Streitschlichtungsurteile offene Märkte? Eine Betrachtung am Beispiel des Zeitschriftenfalles

Theoretical analyses of the WTO dispute settlement mechanism suggest that the system contains only weak incentives for the implementation of rulings. Against this background, it is puzzling that the specific WTO procedure which deals with allegedly insufficient implementation is used only in about one third of the cases where the need for implementation has arisen. Yet, a closer look at the where implementation has allegedly occurred can partly resolve this puzzle: The defendant government implemented the rulings by modifying or repealing the contemplated measures. At the same time, however, it resorted to alternative measures in order to keep the market closed. Some market opening occurred only after the conclusion of the multilateral procedure within bilateral negotiations and in areas which have not been subject to the multilateral dispute. This leads to the hypothesis that the role of the multilateral dispute settlement system could be less important than is generally accepted today. Note: The downloadable document is in German.Protectionism, WTO Dispute Settlement, Implementation

WTO Dispute Settlement: General Appreciation and the Role of India

ABSTRACT On 1 January 1995, the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) entered into force. Until August 2006, the DSU has since been applied to 348 complaints – more cases than dispute settlement under the GATT 1947 had dealt with in nearly five decades. The system is perceived, both by practitioners and in academic literature, to work generally well. However, it has also revealed some flaws. Negotiations to review and reform the DSU have been taking place since 1997 ("DSU review"), however, without yielding any result so far. In the meantime, WTO Members and adjudicating bodies managed to develop the system further through evolving practice. While this approach may remedy some practical shortcomings of the DSU text, the more profound imbalance between relatively efficient judicial decision-making in the WTO (as incorporated in the DSU) and nearly blocked political decision-making evolves into a serious challenge to the sustainability of the system. This article provides an overview of the first eleven years of DSU practice and the current DSU review negotiations. An outlook for future challenges to the system is also given. Moreover, specific chapters of the text focus on the role of India in WTO dispute settlement, her use of the system and her participation in the DSU review negotiations. JEL Classification: F02, F13, K33, K41International Trade; Trade Policy; WTO; Dispute Settlement; Dispute Settlement Understanding; DSU Review Negotiations; India

Negotiating the review of the WTO Dispute Settlement Understanding

ABSTRACT On 1 January 1995, the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) entered into force. Since 1998, negotiations to review and reform the DSU have taken place (‘DSU review’), without however yielding any result so far. This study proposes to analyse the DSU review negotiations and the proposals submitted so far. In a first step, the foundations for the discussion are laid with a brief account of the economic, legal and political aspects of the dispute settlement mechanism, its evolution and its working in practice. In a second step, the study offers an overview and analysis of the negotiating process in its broader context. Additionally, negotiating proposals on stage-specific and horizontal issues of the dispute settlement mechanism are presented and analysed in depth with regard to their background, their contents and their potential implications. In a third step, the difficulties faced by negotiators in completing the DSU review are explored. Policy recommendations for further negotiations are made and the chances of a future agreement are evaluated. Finally, the study is also intended to offer a one-stop point of departure for other researchers who wish to explore further specific aspects of the DSU review. To this end, references available on the DSU review exercise have been comprehensively documented. JEL Classification: F02, F13, K33, K41WTO; Dispute Settlement; DSU Review Negotiations

An isogeometric finite element formulation for phase transitions on deforming surfaces

This paper presents a general theory and isogeometric finite element implementation for studying mass conserving phase transitions on deforming surfaces. The mathematical problem is governed by two coupled fourth-order nonlinear partial differential equations (PDEs) that live on an evolving two-dimensional manifold. For the phase transitions, the PDE is the Cahn-Hilliard equation for curved surfaces, which can be derived from surface mass balance in the framework of irreversible thermodynamics. For the surface deformation, the PDE is the (vector-valued) Kirchhoff-Love thin shell equation. Both PDEs can be efficiently discretized using $C^1$-continuous interpolations without derivative degrees-of-freedom (dofs). Structured NURBS and unstructured spline spaces with pointwise $C^1$-continuity are utilized for these interpolations. The resulting finite element formulation is discretized in time by the generalized-$\alpha$ scheme with adaptive time-stepping, and it is fully linearized within a monolithic Newton-Raphson approach. A curvilinear surface parameterization is used throughout the formulation to admit general surface shapes and deformations. The behavior of the coupled system is illustrated by several numerical examples exhibiting phase transitions on deforming spheres, tori and double-tori.Comment: fixed typos, extended literature review, added clarifying notes to the text, added supplementary movie file

WTO Dispute Settlement: General Appreciation and the Role of India

ABSTRACT On 1 January 1995, the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) entered into force. Until August 2006, the DSU has since been applied to 348 complaints – more cases than dispute settlement under the GATT 1947 had dealt with in nearly five decades. The system is perceived, both by practitioners and in academic literature, to work generally well. However, it has also revealed some flaws. Negotiations to review and reform the DSU have been taking place since 1997 ("DSU review"), however, without yielding any result so far. In the meantime, WTO Members and adjudicating bodies managed to develop the system further through evolving practice. While this approach may remedy some practical shortcomings of the DSU text, the more profound imbalance between relatively efficient judicial decision-making in the WTO (as incorporated in the DSU) and nearly blocked political decision-making evolves into a serious challenge to the sustainability of the system. This article provides an overview of the first eleven years of DSU practice and the current DSU review negotiations. An outlook for future challenges to the system is also given. Moreover, specific chapters of the text focus on the role of India in WTO dispute settlement, her use of the system and her participation in the DSU review negotiations. JEL Classification: F02, F13, K33, K4

The dangerous rise of economic interventionism

This paper reviews the economic interventions by governments and central banks in response to the 2007-2009 financial and economic crisis. In the area of trade policy, we find that protectionism has increased substantially, with governments targeting in particular the products of declining industries and financial services. Nevertheless, spiralling protectionism as in the 1930s has so far been avoided. In investment policy, the crisis has not led to a general increase of protectionist pressures for the time being, although the long-term general trend towards liberalisation has recently been complemented by a parallel trend towards re-regulation. The main areas of economic interventionism, however, have been fiscal policy (mainly through stimulus programs and emergency actions to stabilise the financial system) and monetary policy (mainly through interest rate cuts, quantitative easing and various other actions). Given their cumulative size, these interventions hold a substantial potential for distortions and undesirable side-effects on both the microeconomic and the macroeconomic levels. These include protectionism, political mismanagement and state failure, the degradation of government finances and the threat of future inflation. These concerns can be addressed, but this requires constant monitoring of the policy areas affected and decisive actions towards achieving a timely exit

Negotiating the review of the WTO Dispute Settlement Understanding

ABSTRACT On 1 January 1995, the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) entered into force. Since 1998, negotiations to review and reform the DSU have taken place (‘DSU review’), without however yielding any result so far. This study proposes to analyse the DSU review negotiations and the proposals submitted so far. In a first step, the foundations for the discussion are laid with a brief account of the economic, legal and political aspects of the dispute settlement mechanism, its evolution and its working in practice. In a second step, the study offers an overview and analysis of the negotiating process in its broader context. Additionally, negotiating proposals on stage-specific and horizontal issues of the dispute settlement mechanism are presented and analysed in depth with regard to their background, their contents and their potential implications. In a third step, the difficulties faced by negotiators in completing the DSU review are explored. Policy recommendations for further negotiations are made and the chances of a future agreement are evaluated. Finally, the study is also intended to offer a one-stop point of departure for other researchers who wish to explore further specific aspects of the DSU review. To this end, references available on the DSU review exercise have been comprehensively documented. JEL Classification: F02, F13, K33, K4