|
||
|
TWN
Info Service on WTO and Trade Issues (Feb24/02) Geneva, 30 Jan (D. Ravi Kanth*) — The World Trade Organization is likely to fail to accomplish an outcome in the ongoing informal discussions on reform of the WTO’s dispute settlement system (DSS) at its 13th ministerial conference (MC13) beginning in Abu Dhabi on 26 February, said people familiar with the development. According to paragraph four of the Outcome Document of MC12 held in Geneva in June 2022, trade ministers acknowledged “the challenges and concerns with respect to the dispute settlement system including those related to the Appellate Body, recognize the importance and urgency of addressing those challenges and concerns, and commit to conduct discussions with the view to having a fully and well-functioning dispute settlement system accessible to all Members by 2024.” That mandate on DSS reform hangs in limbo following the US position to continue the discussions, said people familiar with the development. At the regular Dispute Settlement Body (DSB) meeting on 26 January, the US said that “as we approach MC13, we are in favor of neither speeding too quickly to an outcome that overlooks the needs of certain members, nor artificially slowing down the discussions by imposing constraints that limit rather than encourage constructive dialogue.” The US, which triggered the discussions on reform of the dispute settlement system after making the Appellate Body dysfunctional in December 2019, said that “difficult issues remain to be addressed.” The “difficult issues”, according to the US, “include the needs of developing country members and LDCs, but also on critical substantive areas where “judicial” overreach has damaged the functioning of the WTO and altered the Members’ rights and obligations.” While several developing countries have resorted to dispute settlement more frequently for safeguarding their rights, many other members of the Global South are not known to have used the dispute settlement system that often, said people familiar with the discussions. In contrast to the continued US opposition to restoring the Appellate Body by filling the vacancies at the body that Washington had blocked since December 2019, a large majority of developing countries and several industrialized countries want the Appellate Body to become functional expeditiously, said people involved in the discussions. For the 73rd occasion, at the DSB meeting on 26 January, the US blocked a proposal from 130 members for starting the selection process to fill the vacancies at the Appellate Body, citing its oft-repeated arguments all over again, said people familiar with the discussions. POLICY SPACE Seemingly targeting the developing countries that are demanding policy space for pursuing their development- oriented policies, the US asked somewhat rhetorically, “if you are concerned about policy space, you should be for a reformed dispute settlement system.” “A reformed system should address erroneous interpretations on such issues as essential security, regulatory space, remedies for unfair trade, and other fundamental systemic issues,” the US said. The US arguments seemed somewhat disingenuous as it appears to liken its concerns with an independent and impartial Appellate Body as if they are the concerns of all members, said a negotiator who asked not to be quoted. In contrast to the US statement at the DSB meeting, China said rather categorically that “the restoration of a fully and well-functioning dispute settlement mechanism accessible to all members by 2024 is the top priority of China, most members and this organization.” China said, “there are still a number of fundamental issues ahead of us, particularly the issue of appeal/review mechanism, the most difficult but extremely important one in our process.” China seemed rather optimistic that an outcome on DSS reform could be wrapped up at MC13. “Within less than one month, we have no choice but to maintain the current positive momentum and further accelerate our work both on the consolidated text and the appeal/review mechanism, to make our best efforts to wrap up everything and deliver the outcome at MC13,” it said. Several other industrialized countries also pressed for intensifying the discussions on the fundamental issue of the appeal/review mechanism that would determine whether the enforcement function of the WTO remains robust or not, said people, who asked not to be quoted. The DSB meeting witnessed divergent views on what ought to be an outcome at MC13. Several industrialized and some developing countries considered that the text produced by the “volunteer facilitator” (a term coined by the US) from the informal process could be the basis, while several developing countries opposed the idea, said people familiar with the discussions. The revised fifth version of the draft text circulated by the facilitator, Mr Marco Molina, the deputy trade envoy of Guatemala, could be the basis for further negotiations, said several industrialized countries. Several countries such as the United Kingdom, Australia, Peru, the European Union, New Zealand, Japan, Switzerland, Mexico, Singapore, Korea, and Colombia appeared rather sceptical in formalizing the discussions, as it could undermine the positive momentum, said people who asked not to be quoted. In contrast, several developing countries – South Africa, India, Indonesia, Pakistan, Thailand, Turkiye, and Malaysia – opposed any “early harvest” or mini-package on DSS reform at MC13, said participants, preferring not to be quoted. These countries along with China called for formalizing the DSS reform discussions on a priority basis. DSB CHAIR’S REPORT In his report, the chair of the DSB, Ambassador Petter Olberg of Norway, said that he held consultations with members on how and when to “formalize” the informal process of the discussions. Members appear to have stated that they consider dispute settlement reform a priority issue for MC13 and beyond, the chair said. Commenting on the issue of formalization of the informal process, Ambassador Olberg said that while members underscored the need to formalize this process, it seemed clear that formalization means different things to different delegations, in terms of process, timing, purpose, and leadership. Without naming the groups or countries that he had met during his consultations, the chair suggested that some members reiterated their position that the informal discussions on dispute settlement reform be formalized under the DSB and General Council as quickly as possible. It appears that some members suggested that the formalization of the informal discussions must be done at MC13. It appears for several other members that the formalization of the informal discussions must be done at the first DSB meeting after MC13. Several industrialized countries, however, indicated that the formalization of the informal discussions should be done sometime in the future when the text is complete. Against this backdrop, the chair seems to have concluded that there is no consensus on this issue at this juncture. The facilitator, Mr Molina, presented a report on the status of the informal discussions. He suggested that the dispute settlement reform discussions are being held on two separate tracks: one on the revision of the draft consolidated text and the other on the discussion on the appeal/review mechanism. As reported in SUNS last week, the chair’s revised fifth version of the text has not included any language on the appeal/review mechanism. [* A shorter version of this story appeared in SUNS #9935 dated 30 January 2024.] +
|
||
