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TWN
Info Service on WTO and Trade Issues (Apr26/14) Yerevan, 22 Apr (D. Ravi Kanth) -- Prospects for reviving the discussions on the reform of the World Trade Organization's dispute settlement system seem to have brightened following the appointment of Brazil's trade envoy as the new chair of the WTO's Dispute Settlement Body (DSB) on 21 April, said people familiar with the development. Even so, the United States - for the 96th time - blocked a joint proposal by 130 countries to expeditiously fill all seven vacancies on the Appellate Body, the WTO's highest judicial arm, which Washington has unilaterally paralyzed since December 2019, said people familiar with the development. Brazil is among many countries that have repeatedly pressed for a binding dispute settlement system to ensure that the WTO's crucial enforcement function remains effective, said people familiar with the development. In sharp contrast, the US has consistently opposed the continuation of the Appellate Body during the dispute settlement system (DSS) reform discussions. Successive facilitators adhered to Washington's demands but their proposals were constantly brushed aside on seemingly spurious grounds that the proposed DSS reforms did not address Washington's concerns, said people familiar with the development. Instead of undertaking a robust process in the reform discussions, the previous DSB chair, Ambassador Claire Kelly of New Zealand, seemingly adopted a passive approach, said several trade envoys, who asked not to be quoted. Ambassador Kelly's approach to DSS reform seemingly paved the way for the controversial reform of the WTO facilitated by Ambassador Petter Olberg of Norway, who had proposed three reform issues - decision-making, development (including changing the current architecture for availing of special and differential treatment by developing countries on a self-designated basis), and so-called "level-playing field" issues, said people familiar with the development. Ambassador Olberg's allegedly high-handed approach during the WTO reform discussions drew opposition from several delegations, with one delegation apparently criticizing his overall approach at a General Council meeting early this year, said a trade envoy who asked not to be quoted. Later, the US brought proposals to change the most-favored-nation (MFN) treatment principle, which enshrines non-discrimination as the cardinal treaty right for developing countries to avail of special and differential treatment (S&DT) on a self-designated basis, said trade envoys who asked not to be quoted. At the failed WTO's 14th ministerial conference (MC14) in Yaounde, Cameroon, on 29 March, many countries flagged DSS reform as the central issue - a concern also reflected in reports issued by the Minister-Facilitators on 2 April. Without proper DSS reform - acknowledged at MC12 in Geneva in June 2022 and MC13 in Abu Dhabi in March 2024 - the overall WTO reform discussions lack any credibility, sources said. APPELLATE BODY APPOINTMENTS Against this backdrop, at the DSB meeting on 21 April, the US continued to oppose the expeditious filling of all seven vacancies at the Appellate Body. At the DSB meeting, on behalf of 130 countries, Colombia introduced the joint proposal for the 96th time, calling for the immediate launch of the selection process to fill the seven vacancies. The extensive number of members submitting the proposal reflects a common interest in the functioning of the Appellate Body and, more generally, in the functioning of the WTO's dispute settlement system, Colombia said. More than 20 members, including China and the European Union, intervened to support the Colombian proposal and reiterated once again the immediate need to restore a fully functioning dispute settlement system. It appears that many members called for engaging on DSS reform in Geneva following the failed MC14 in Yaounde. However, the US stuck to its oft-repeated position that its fundamental concerns over the dispute settlement system are not being addressed. The US also does not believe a reformed WTO dispute settlement system is viable, hinting at resolving trade disputes bilaterally rather than multilaterally, said participants familiar with the DSB proceedings. As the coordinator of the 130-member joint proposal, Colombia expressed sharp regret that for the 96th time, members have not been able to launch the selection process to fill the vacancies at the Appellate Body. Colombia also suggested that ongoing conversations about DSS reform should not prevent the Appellate Body from continuing to operate fully, emphasizing the need for members to comply with their obligations under the Dispute Settlement Understanding (DSU) to fill vacancies as they arise, said participants who asked not to be quoted. On another issue concerning the Multi-Party Interim Appeal Arbitration Arrangement (MPIA), several members, led by the EU, affirmed the statement released at MC14 that highlighted the MPIA's value. The EU-created MPIA reportedly welcomed Barbados, Liechtenstein and Moldova, who had joined last month. MPIA members include: Australia; Barbados; Benin; Brazil; Canada; Chile; China; Colombia; Costa Rica; Ecuador; the European Union; Guatemala; Hong Kong, China; Iceland; Japan; Liechtenstein; Macao, China; Malaysia; Mexico; Moldova, Republic of; Montenegro; New Zealand; Nicaragua; Norway; Pakistan; Paraguay; Peru; the Philippines; Singapore; Switzerland; Ukraine; Viet Nam; the United Kingdom; and Uruguay. The MPIA's raison d'etre for resolving trade disputes is based on Article 25 of the DSU, which centers on arbitration to avoid the binding Appellate Body process. Meanwhile, under another agenda item, in a trade dispute raised by Chinese Taipei over India's tariff treatment on certain goods in the ICT sector, whose panel report in favour of Chinese Taipei was circulated on 17 April 2023, the two sides sought more time to continue engagement toward a resolution. The parties requested the DSB to further delay consideration of the panel report until 27 October 2026, to which the DSB agreed. Prior to this, the DSB had agreed to eight previous requests from India and Chinese Taipei to delay consideration of the report. Also at the DSB meeting, Australia, Canada, the EU, Japan, Korea, New Zealand, Norway, Switzerland, and the United Kingdom condemned Russia's invasion of Ukraine and expressed their support for, and solidarity with, Ukraine and its people. Surprisingly, the US appears to have remained silent, while the Russian Federation said that this issue does not concern the DSB and should not be addressed in this forum. However, WTO members appeared to remain silent on the war launched by the US-Israel axis against Iran, which is not a WTO member. To recall, the US has for more than two dozen times consistently blocked Iran's entry into the WTO since 1996. Even though a ray of hope emerged for consideration of Iran's application immediately after the signing of the Joint Comprehensive Plan of Action (JCPOA) between Iran and the five permanent members of the UN Security Council (the US, Russia, China, France, and the United Kingdom) plus Germany, it was soon smothered by the Trump administration, said people familiar with the development. Meanwhile, under the agenda item of surveillance of implementation of recommendations adopted by the DSB, the US presented status reports regarding DS184, "US - Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan"; DS160, "United States - Section 110(5) of US Copyright Act"; DS464, "United States- Anti-Dumping and Countervailing Measures on Large Residential Washers from Korea"; and DS471, "United States - Certain Methodologies and their Application to Anti-Dumping Proceedings Involving China." The EU presented its status reports regarding DS600, "European Union and Certain Member States - Certain Measures Concerning Palm Oil and Oil Palm Crop-Based Biofuels"; DS291, "European Communities - Measures Affecting the Approval and Marketing of Biotech Products"; and DS593, "European Union - Certain Measures Concerning Palm Oil and Oil Palm Crop-Based Biofuels." Indonesia presented its status reports in DS477 and DS478, "Indonesia - Importation of Horticultural Products, Animals and Animal Products." +
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