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WTO GETTING INTO LEGAL TANGLES AND KNOTS

by Chakravarthi Raghavan


Geneva, 15 Dec 99 -- The 'rules-based' World Trade Organization appears to be getting into more and more legal tangles about the status of the 3rd Ministerial Conference and the end of the Seattle process, and involving a power tussle of sorts, among and between members and the secretariat.

The tangle is such that some of the legal experts are taking an easy way out by saying the issue is no longer one of interpretation of law, but a political issue to be resolved politically by members - implying that political decisions can be taken by consensus and over-ride the rules and the WTO law!

According to some trade diplomats present at the 3 December COW meeting, Mrs. Barshefsky in her speech used the term 'suspended' and also the term 'adjourned'.

But twelve days after the end of the Seattle meet, the secretariat and its conference division appears still unable to provide members with a verbatim record of what transpired at the meeting of the Committee of the Whole on the night of 3 December, when Mrs. Barshefsky spoke and announced her decision to suspend the conference.

According to trade diplomats, basing themselves on information provided to them by secretariat officials, the delay is due to the 'baggage' from Seattle having been 'lost' or 'misplaced', and traced to London's Heathrow airport, from where it is expected to reach Geneva probably Wednesday!

There is so much of mistrust surrounding the Seattle meeting and its arrangements that outside the trade diplomats, the transcripts of these tapes would be met with suspicion.

The WTO Director-General, Mr. Mike Moore, has convened a special session of the General Council on Friday (17 December), but the Council's ability to meet and act on two of the agenda items proposed by Moore (Jordan's accession and followup to Seattle) depends on the 'legal' status of the Seattle meeting after midnight of 3-4 December, and legal effect of chairperson, Mrs.Charlene Barshefsky, ending that meeting with a statement to the Committee of the Whole and the subsequent plenary.

The only item on which the Special Session of the Council could probably act, without any challenge, would be the item about the budget of the WTO and the report of its Committee on Budget and Finance, which under Art, VII is a function assigned to the General Council.

Under Art.IV.1, which constitutes the Ministerial Conference (to be composed of representatives of Members) and mandates it to meet at least once in two years, all the functions of the WTO are to be carried out by the Ministerial Conference.

Art.IV. 2, second sentence, provides that "In the intervals between meetings of the Ministerial Conference, its functions shall be conducted by the General Council."

If the conference is in a state of suspension, then the General Council cannot carry out any of the functions of the WTO vested in the Ministerial Conference, but only those functions specifically assigned to the General Council by the Marrakesh agreement: its responsibilities meeting as a Dispute Settlement Body and as a Trade Policy Review Body (Art.IV.3 and Art IV.4), and of approving the budget and contributions of members to the budget, under Art.VII.

All other functions, including decisions on accession (Art XII), are vested in the Ministerial Conference under Art. IV:1. And in terms of the second sentence of para two of Art.IV, "in the intervals between meetings of the Ministerial Conference, its functions shall be conducted by the General Council."

And perhaps with an eye to some advantages (the moratorium on e- commerce tariffs, and keeping some of the 'papers', including that on labour and trade and globalization, brought on the table by a dubious tactic at the final COW meeting), the US on the one hand insists that the conference is 'suspended' and not concluded or adjourned.

At the same time, trade diplomats say, the US also wants some actions from the Council.

But going by the rules, the confused end to the meeting at Seattle on the night of 3 December, and the official US position that the Ministerial Conference is in "suspension", with USTR Mrs.Charlene Barshefsky still holding the chair, means that the organization in effect remains paralysed.

Between Mr Moore who, according to his 7 December statement, has been 'directed' by Mrs.Barshefsky (who never was formally elected as chair of the Seattle ministerial meeting) to carry out consultations and discuss 'creative ways' to bridge remaining areas where consensus is lacking and prepare for a successful conclusion of the Conference, and Barshefsky (who as chair of the 'suspended' conference can claim to have sole authority to resummon it), would there be a price to be paid by other members to end the paralysis?

There are reports that there is to be a meeting this Friday in Washington between President Clinton and Mrs. Barshefsky on the one side and the EU Commission President Romano Prody and the EC Trade Commissioner Pascal Lamy to resolve the crisis.

WTO secretariat officials have been advising trade diplomats (who have complained that the Council meeting clashes with a scheduled meeting of the UNCTAD Trade and Development Board to finalise documents for UNCTAD-X) that the General Council session could be short.

Some European diplomats have been briefing their media that the Friday meeting could only be a 'technical one' (it was not clear from the second hand information provided by European media persons, none of whom are familiar with WTO technicalities, as to what was meant by it), but that Mr.Moore is pressing for more substantive decisions. (SUNS4574)

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

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