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Appellate Body sets rules for NGO briefs in asbestos case

by Chakravarthi Raghavan

Geneva, 9 Nov 2000 - A division bench of the WTO’s Appellate Body (AB) has adopted a procedure to enable non-governmental organizations to send in written briefs to the AB hearing the appeal filed by Canada in the asbestos case, where a panel upheld the right of France to keep out imports of asbestos on health grounds.

France had imposed the restrictions, and Canada had challenged it. But the panel ruled against Canada, agreeing that the French action was covered by the exceptions, on health grounds, under Art.XX of the GATT.

The AB’s decision to set up such a procedure, and the conditions under which it would receive briefs from NGOs on the asbestos case, has been notified by the secretariat of the WTO to several hundred NGOs on Thursday.

The action of the AB, compounded by that of the WTO secretariat, in effect providing the NGOs with greater rights than WTO members, has further angered many WTO members, particularly from the developing world.

At an informal consultation Thursday on the ‘external transparency’ issues that have come up in the post-Seattle ‘confidence building’ scenario at the WTO, India and Mexico appear to have voiced their objections and criticism over the AB’s continued disregard of the views of the members, repeatedly expressed in the DSB.

Other developing country delegates commented equally adversely in the corridors Thursday, and said the issue is now likely to be taken up at the DSB meetings.

According to some of them, though the Dispute Settlement Understanding and the procedures of the Appellate Body require that any working procedures established have to be in consultation with the Director-General and the Chairman of the DSB, in this case (as in some other earlier cases), the Chairman of the DSB does not appear to have been consulted.

The last time this issue, and the ‘working procedures’ of the AB came up at the DSB, the chairman made it clear that the ‘consultations’ required under the WTO rules with the DSB chair before the AB establishes any working procedure, was not one with the chair individually, but through the Chair with the entire membership.

But the panels and the AB at the WTO, taking advantage of the fact that their rulings can be set aside only by consensus (the so-called negative consensus) have become a law unto themselves—exercising legislative functions in creating new obligations (often for developing countries) of substance, and also violating the procedural rights of members while creating new ones for outsiders.

Under the so-called ‘confidence-building’ measures after the Seattle debacle, two issues have figured: the issue of internal transparency in decision-making, and that of ‘external transparency’, which the US and EC have been using to provide for a right to NGOs to present briefs in disputes before dispute panels.  There has been strong opposition to this from the developing countries.

But ignoring all this, the secretariat and the appellate body, has been trying to ‘play to the gallery’ by accepting briefs sent in by NGOs, circulating them to panels and the appellate body, with panels and appellate body reserving to themselves the right to decide whether or not to take account of them.

This has angered the developing countries even more. For, a net result of this has been that while the WTO members cannot intervene before panels and the appellate body unless they have a third party interest and had notified the DSB of such interest when a dispute is referred to a panel, the non-members (like NGOs, a term which seems to include industry lobbies too) have been provided more rights than members, even if that right is ‘discretionary’ (at the discretion of panels and the appellate body).

The panels and the AB taking in amicus curiae briefs from non-governmental organizations, and establishing a right for NGOs higher than for the WTO members themselves (whose rights to intervene before panels and the appellate body are more circumscribed) has been the subject of considerable controversy at the WTO.

The appellate body has been repeatedly assailed at the meetings of the Dispute Settlement Body for asserting a right to receive amicus curiae briefs—in the shrimp-turtle case, and then in the US steel anti-dumping case—under so-called working procedures.

The DSU rules themselves only enable parties to a dispute to present briefs and oral arguments. WTO members who notify their interest as third parties can also intervene before panels to present their views.

Only parties can appeal a ruling, and third parties who appeared before the panel, can intervene in the appeal. WTO members who did not notify and become third parties before a panel, cannot intervene before the AB, even if on reading a panel ruling they find they have an interest because of the wider application of the rulings.

The AB action now, as in two other earlier instances, has placed the situation of the NGOs on a higher footing than members - even if the AB can be quite arbitrary on which briefs they will take in and which they will not.

The procedure notified by the AB on 8 November, was promptly sent out by the external relations division of the WTO secretariat to all the NGOs (public interest, industry groups etc) that are on its roster.

The action of the Secretariat - under Mr. Ruggiero who openly boasted of it at the Geneva Ministerial meeting press conference, and continued now - as well as that of the AB in accommodating the NGOs has been welcomed by some of the environmental NGOs, and some industry lobbies.

But it has not impressed developing country NGOs - who insist that the real issue is that of democratic and transparent decision-making among members, and the transparency of this decision-making to the outside; and so long as these are not resolved to the satisfaction of civil society, the WTO and its processes will remain illegitimate.

In respect of internal transparency and accountability of governments of countries and their trade representatives, southern civil society has been arguing for publication in advance, at least six months in advance, of changes in rules and/or new agreements proposed, to enable public discussion in each country and ability of the public to influence their governments.

As a corollary, these NGOs have also been demanding that even if consultations are held informally, before they are formally placed before the relevant WTO body, as is required under the rules, they should be published and circulated (and not at the last moment at the meeting as is now often the case), and the list of members who were actually present at the meeting where the decision is taken published.

Since the WTO defines consensus for decision to mean that ‘no member, present at the meeting when the decision is taken, formally objects to the proposed decision’, accountability of governments and their WTO representatives to the peoples of their country and their parliament is feasible only if there is a formal record and this is immediately published.

Under the current practice, the WTO keeps a record at the time a meeting starts, but no actual roster if a meeting is continued from one day to another, nor of who were present at a meeting when a decision is taken. And the record of members actually present inside the room when decisions are taken is any event not available to the public. The WTO secretariat message about briefs for the asbestos case drew attention of the recipients to the fact that the AB has adopted a special procedure - solely applicable in the asbestos case - dealing with written briefs from persons other than parties to the dispute, and third parties (members of the WTO who had notified and participated as third parties before the panel).

In its communication to the DSB chair about the additional procedure adopted, the AB has said that the division hearing the appeal has decided “in the interests of fairness and orderly procedure” in the conduct of the appeal to adopt an additional procedure to deal with written briefs received by the AB from persons other than a party or a third party.

Any such person, natural or legal, the AB procedure says, should apply for leave to file the brief by noon 16 November. The description of the applicant, statement of membership and legal status, general objectives pursued, the sources of financing, the nature of interest in the appeal, and a statement whether the applicant has any relationship, direct or indirect, with any party or third party to the dispute.

Once the request to file a brief is accepted, the NGO has to file the brief by 28 November, but cannot address oral arguments.

One trade diplomat said that the real issue is not whether these stipulations for amicus briefs in this case are good or bad or insufficient, but the authority under which the AB and the panels following their rulings are enabling persons, other WTO members, to have a say or voice in disputes between governments, and in doing so providing more rights to these outside than to the WTO members.

The AB or the panels, unlike courts in national jurisdictions, have no inherent powers under the WTO, but strictly what is laid out and allowed, and cannot do anything on the ground that it is not prohibited.

Though this issue has been raised in the DSB, and discussed on at least three occasions, the AB and the secretariat have ignored them.

Unless members decide to assert their rights, by bringing up a motion for an authoritative interpretation to be taken by a vote, they will continue to remain impotent - as the secretariat and the AB play to the gallery, and to the tune of the powerful, the US and the EU who want to please some of their domestic lobbies.

But if they don’t act, the legitimacy of the WTO and its dispute system will continue to be challenged and will bring down the system, in the medium- to long-term.

The above article first appeared in the South-North Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief Editor.

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