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AB and DSU functioning getting curiouser and curiouser

Geneva, 11 Oct (Chakravarthi Raghavan) - The functioning of the WTO Appellate Body under the DSU, and its procedures vis-a-vis the explicitly laid out provisions of the WTO treaty and its DSU, and the rights and obligations of members, appears to be getting curioser and curioser - with the ‘facts’ about the ‘consultations’ of the AB with the DSB sounding like a fairy tale or one of Lewis Carroll’s stories of Alice in Wonderland.

Fairy tales have their place, but not in a rules-based organization, enforcing rules on everyone else.

The chairman of the DSB, Amb. Carlos Perez Del Castello of Uruguay, held ‘consultations’ Thursday with the DSB members over the AB’s “decision” to amend its working procedures, which was communicated to the DSB chair on 27 September.  The DSB consultations are to continue on 14th October.

The widespread view at the meeting was that through an interpretative route or otherwise, the AB’s working procedures, and consultations for changing them, must be formalised in a better way, and required to be published in the WTO’s official rule-book. Only the US appears to be having some reservations, and wanted time to think over it. However, even the US said the consultations with the DSB chair and the DG on working procedures did not mean individual consultations but one of an institutional and collective character, and that the DG himself should be required to notify and circulate to all the WTO members when the AB wants to consult him on change in procedures.

The AB’s decision to amend the working procedures appears to be in fact an attempt to get over the outrage caused by its rule-less and high-handed behaviour in the Peru vs EC sardines dispute (SUNS #5202) - allowing the EC through working procedures to withdraw its appeal and file a new one, take on amicus curiae briefs, including one provided by Morocco (which is not a third party in the dispute), while not allowing Colombia (a third party that had appeared before the panel) to intervene and respond to presentations at the oral hearing, though it had been permitted to be present as a mute observer.

Colombia after the oral hearing had been talking to other WTO members about what happened and gathering support to raise the issues at a special DSB or General Council meeting as happened in 2000. Perhaps to avoid criticisms, the AB appears to have decided to amend its procedures (so to say, to retrospectively justify what it was doing) and assert its positions.

Though the issue has not yet surfaced, several trade diplomats, some with amusement, have also been talking of the efforts of the AB, under its current presiding member, Mr. James Bacchus (from the US), to take on the garb of a Court, trying out the ‘limits’ of tolerance of WTO members, by suggesting that those appearing to argue cases before them should address the AB division bench from a rostrum (and standing) as in the courts. According to the corridor gossip, this has already been tried out in one or two hearings (where parties anxious to win cases are unlikely to challenge them) and the AB under Bacchus had been planning to change the working procedures for this purpose, but was talked out of it on the ground that it may raise more objections.

One trade diplomat said sarcastically in private that Mr. Bacchus may next ask us to appear before him in robes (not many even of AB members can actually wear the legal robes), but a duck cannot become a swan by wearing swan’s feathers.

The panels and the AB are part of the DSU/DSB process, whose objective is laid out in the DSU as promoting settlement of disputes among parties, and not a judicial body in international law.

While members are showing a great deal of deference and tolerance, at some stage or the other, there would be concerted efforts to force votes on authoritative interpretation, or threats to impeach the AB members and their conduct in subverting the WTO members’ explicit jurisdictions.

The AB’s communication, signed by the presiding member, Mr. Bacchus, purports to have ‘consulted’ the DSB chair on 9 September. But this seemed to be at variance with the version given by the DSB chair to the members at yesterday’s informal open-ended consultation, according to trade diplomats who attended the meeting.

The consultations were reportedly well attended, with one of the larger committee rooms of the WTO (where it was held) fairly full.

The version of the ‘consultation’ process, provided to the informal meeting by Perez del Castello, at the least suggested that it was a farce of a consultation, some trade diplomats at the meeting said later.

According to what they heard from the DSB chair, the secretariat of the AB had called up Perez del Castello to schedule an appointment, and the DSB chair had gone there on 9 September. He was not advised in advance of the purpose. It is not very clear whether the WTO secretariat’s legal division had been advised so that they could be present with him, or had brought to his attention the discussions in 1995 and in 2000 that confirmed the ‘consultations’ with the DSB chair was a consultation with the DSB through the chair.

At the meeting, according to the trade diplomats, the AB presiding judge conveyed or read out to him the changes that the AB had decided to make, and that this was all the ‘consultation’. He was not asked by the AB to consult the DSB members and give their or his views. Whether Perez del Castello, an economist and experienced trade negotiator with a good relationship with other trade ambassadors, knew or understood the legal intricacies, and/or was advised about them by the secretariat, are not very clear.

Within the WTO hierarchy, the AB members have a position and status in between a Director and a Deputy DG.

On the eve of the 1 October meeting of the DSB, the tentative agenda was about to be listed, and this issue put down for consideration or discussion after the regular business. Later the item was changed into a statement from the chair under ‘other business’ where the 27 September communication was to have been conveyed. Members who got to know about this had indicated that they would object, and the item was taken off the agenda, for informal consultations.

There was an overwhelming view that there should be formalisation of the rules to clearly stipulate that the AB, before changing any procedures, has to consult with the DSB through the chair, and that the consultation itself is not a ritualistic formality, but intended to let the AB know the views of the members and for them to come back to the membership, if needed.

There is a reluctance among the membership - except for a few who have had to put up with the AB’s attempts to create ‘judicial law’, as Mr. Sriranga P.  Shukla put it at the UNCTAD Trade and Development Board’s informal plenary of a panel of experts (on 9 October) - to come into a direct clash with the AB.

The AB’s attempts, and that of the EU and US, to quieten some of their domestic opposition, by wanting to provide opportunity for NGO participation through amicus curiae and other gimmicks, so that the reality of the Star Chamber activities of the dispute settlement system can be hidden under legal and judicial outward trappings, has not attracted much civil society support.

Along with the other rising protests against the WTO and its invasion of domestic economic space of member countries, the functioning of the DSU and the panels and AB, and the secretariat itself (the legal and rules divisions, and the AB) to behave lawlessly, and attempt to force new obligations on members for objectives not even mentioned in the WTO treaty, is building up within countries.

The ‘deeper integration’ of countries and economies through the WTO agreements and rules is not an objective of the WTO in its preamble or elsewhere.

Neither the AB, nor for that matter the WTO head, Dr. Supachai Panitchpakdi (whatever views he holds as an economist), as the head of the WTO in his public statements (as at the informal meeting with the Trade and Development Board) or his deputy Dr. Rana at the formal TDB meeting Thursday, can take it upon themselves to promote or pronounce themselves on this inside or outside the WTO.

Without the express authority of the General Council or the Ministerial Conference, they have no such mandate.

They would be pronouncing themselves only at the risk of more ‘Seattles’ and opposition to rulings and agreements in the developing world and the populous countries. Even the Bush-Blair doctrines and use of force, or threat of war, will not be able to quell the opposition and command cooperation and obedience. – SUNS5211

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