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ROLE OF THE WORLD TRADE ORGANIZATION IN RESOLVING AGRICULTURAL
TRADE DISPUTES
1. INTRODUCTION TO THE WORLD TRADE ORGANIZATION (WTO)
History and Formation of the WTO
The WTO officiated on the 1st of January 1995, evolving from the GATT which was formed in
1947 to fight protectionism that fueled the Great Depression and wars (Ahearn, 2019). GATT’s
central aim was to progressively reduce tariffs as well as eliminate trade barriers in a systematic
manner to promote economic growth and development. The actual international trade governing
started with GATT that went through several negotiation rounds each focused on specific
elements of the trade regimes. The most exceptional round of the GATT structure can be
identified with the Uruguay Round that covered from the year 1986 to 1994 that changed the
realm of negotiations from only goods to services and property rights and agriculture which were
previously marginalized areas. The legal end of Uruguay Round brought the Marrakesh
Agreement that formally created the WTO as a chief international organization overseeing
relations in the global trade (Ahearn, 2019). The dawn of this era thus witnessed an evolutionary
change in the structure and institution overseeing international trade and capable of dealing with
more multifaceted trade problems and trade disputes at an international level. Through
establishing standardized structures and practices for bargaining, resolving and implementing the
conflict, WTO aspired to introduce more order, stability, and efficiency in the international
relations, the creation of the WTO signified the recognition of a modern paradigm of trade
relations based on the international institutions’ collaboration and addressing a range of conflicts
peacefully by utilizing the set of rules. Thus, the WTO is a significant improvement over the
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GATT era as it offers a long-term framework for continued development of the required
cooperation and stability of the members’ economies in a given and constantly changing
international environment.
WTO's Structure and Decision-Making Processes
WTO or the World Trade Organization works through a framework that is supposed to be
constructive for the purpose of having its members make acceptable and comprehensive
decisions. Disseminated at the top of this framework is the Ministerial Conference, which should
be held at least once every two years with delegates of all member countries (Ares, 2021). This
body has the responsibility of making decisions on all the aspects of the multilateral trade
agreements, reporting directly to the Ministerial Conference are the General Council which is
administrative center of the WTO and concurrently is the Dispute Settlement Body and the Trade
Policy Review Body. Furthermore, the WTO is accompanied by specific councils like; the
Council for Trade in Goods, the Council for Trade in Services, and the Council for Trade-Related
Aspects of Intellectual Property Rights that operates in particular trade agreement domains while
being part of the General Council. It can be stated that decision making in the WTO is majorly
based on voting and consensus decision taken for fair decision and involving all countries.
However, if consensus cannot be reached a decision can be made by a simple show of hands
where a majority wins the vote (Bown & Keynes, 2020). The structured governance model as
described here is more rigid and its intention is to enhance order and consistency in the
management of the international trade (Ares, 2021). Based on the described provisions and
functioning of WTO, furthering the idea of open debate and understanding of the procedures in
turn aids member nations in maintaining fair trade practices and bring about issue resolution and
policy application that is rule bound. Consequently, the WTO’s structure is reflecting the
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organisation’s adherence to the multilateralism as a key to organisational decision-making
integrating simultaneously the members’ national purposes and interests in the sphere of the
international trade regulation.
Key Principles of the WTO
The legal structure of operation of WTO is based on certain principles that govern the intents of
WTO in regards to trade liberalization. Fundamental to all these principles is the principle of
non-discrimination here which is divided into the Most Favored Nation (MFN) and the principle
of national treatment (Buzard, 2017). The MFN principle requires that treatment offered to a
particular member regarding the trade must be provided to the other members without
discrimination. Also, the National Treatment mandates a member state to afford imported goods
equal treatment as domestically produced goods once the imported goods have entered the
member’s market. Transparency is another principle which calls for members to declare their
trade policies and regulations and submit notification in the WTO of any change. Reciprocity
emphasizes cooperation in the sense that each member’s concession is matched by equal gains
for the trading partners. Furthermore, it features special and differential treatment which offers
flexibility as well as assistance for developing countries to undertake the disciplines and provide
technical cooperation for them to fulfill their obligations (Charnovitis, 2018). These principles
are in total constitutive of the WTO’s vision to provide the much-needed structure in the
international trade system that is fairly ordered for trade member countries. By encouraging
openness within nations, fair treatment among trading partners, and fair negotiations for that
cause, the WTO’s goal is to reduced trade irregularities and fair differences which contribute to
international economic stability and development. In other words, these principles are
fundamental to the WTO’s work of building a trading ecosystem that is open, fair and trade-
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liberalized in which all players will support themselves, but with special regards to the
developing countries and how they can fit well into the international trading system.
Major Agreements Related to Agriculture
Agriculture has been a central and contentious area of trade negotiations within the WTO
framework. The Agreement on Agriculture (AoA), a significant outcome of the Uruguay Round,
aims to reform global agricultural trade and make it more market-oriented (Anderson, 2016). The
AoA addresses three main areas: market access, domestic support, and export subsidies. Market
access involves reducing tariffs and converting non-tariff barriers into tariffs, which are then
progressively reduced. Domestic support disciplines seek to limit government subsidies that
distort trade by categorizing them into different "boxes" based on their impact on trade. Export
subsidies, which often lead to unfair competition by allowing producers to sell goods at lower
prices on the international market, are to be reduced and eventually eliminated. The AoA also
includes provisions for special and differential treatment, recognizing the unique challenges
faced by developing countries and granting them more time to comply with the rules (Anderson,
2016). This agreement is crucial for promoting fair competition and improving global food
security (Bown, 2017).
WTO's Role in Global Trade and Agriculture
The WTO is another important institution within international trade especially taking into
account the agricultural trade. The WTO assistance in trade negotiations minimizes the
hindrances to the value of trade by overseeing that the markets remain open and competitive as
pointed out by Ahearn (2019). The WTO’s DSM is perhaps most relevant as a tool for the
settlement of trade disputes and the enforcement of the terms of the WTO and member State
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trade relations as it provides the necessary structure for the complaints system where member
states can approach the WTO for remedy against violations of WTO treaties. In agriculture, the
role of the WTO can be observed in moderating the impacts of protectionism and subsidizing
that affects the international market, thus, under the terms of the AoA, which was adopted within
the WTO, the organization is working to establish the principles of fair trade and turn the
signatory countries into parties to certain obligations while negotiating the terms of the future
trade. Moreover, the WTO maintains trade practices by using the Trade Policy Review
Mechanism so that the government and members would be conscious with the policies they
entered in according with the WTO regulations. This omission builds confidence among the
trading partners and serves to maintain the stability and the certainty, according to Anderson
(2016). In this way, the WTO helps to achieve fairer distribution of fruitages of agriculture
growth, thus contributing to food security and economic growth in the world, which is essentially
noted by Ares(2021). The WTO’s evolved system of trade management in agriculture doesn’t
only correct any existing distortions but also serves to include all WTO members in a system of
fair treatment to fellow members. This in turns contributes positively to the global economic
stability and development given that the playing field is leveled and all countries, both developed
and developing, can compete for market themselves in the global arena. Thus, assistance given
by the WTO in the regulation of agricultural trade is considered essential for the stabilization of
economic development and the enhancement of food security on a global scale.
2. AGRICULTURAL TRADE DISPUTES: CAUSES AND IMPACTS
Common Causes of Agricultural Trade Disputes
Several common factors form the root of agricultural trade disputes an aspect that supports the
notion that agriculture is indeed a global business. The subsidies provided by the governments of
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the world to their domestic farming industry is one major reason. These subsidies can result in
unfair trade competition since they make the products of farm holders within the exporting
country cheaper than what they should normally be on the international market (Gao, 2018). This
frequently becomes a source of complaints with other countries that cannot be able to match their
price due to subsidies hence creating trade barriers. High tariffs, for instance high import tariff’s
levied on agricultural products are some of the common sources of conflict, these tariffs are
beneficial to domestic industries because they offer them a shield, but they greatly limit access to
a particular market for foreign producers. Quantitative restrictions such as quotas, import
licenses and measures dealing with sanitary and phytosanitary matters also have influence. These
measures despite the fact that they sometimes are necessary to safeguard human, animal or plant
life can be viewed as protectionism tools if used frequently and unjustly (Frankel, 2018).
Furthermore, questions connected with intellectual property, especially when referring to GMOs
and seed patents create controversies because countries have to find a balance between the
rewarding of innovative achievements and the access to agricultural resources (Gao, 2018).
These intellectual property issues normally entailing series of deals on the use and sale of those
said technologies pertaining to agriculture create considerable strain between nations, these
characteristics of the identified disputes prove that international trade is complex and requires
regulation as well as effective tools for solving emerging issues. With global agriculture trade
constantly on the rise, there is need to counter these causes of conflict through dignified practices
on the trade fronts.
Types of Trade Barriers in Agriculture
There are common barriers to trade in agriculture and these affect trade in the sector in different
ways. Export and import taxes, which are types of tariff, are the most direct way of protectionism
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as they raise the cost of imports making the imported products less competitive to the locally
produced ones (Evenett & Fritz, 2019). Non-tariff barriers are of wider kind and include; quotas
which specify a limited volume of a product that can be imported/exported during a specific
period. But it has the capacity to be a trade restriction if the sanitary and phytosanitary measures
are applied excessively or scientifically unjustifiable. Measures such as quality management, risk
assessment, technical and environmental specifications, among others, crucial when it comes to
safety, turn into barriers at a certain point and become protectionist in their essence when
overused. Like TBT, which includes labeling, standards, and testing procedures, they equally
hinder trade if they are complex or discriminative. Technical regulations for protection of quality
and safety can become serious barriers to the foreign producers if not non-discriminatory.
Another type of trade barriers to sustainable international business is export subsidies, which are
government interventions to reduce the export price of goods to the global markets; they
constitute unfair competition for firms in global markets (Gasser & Palfrey, 2020). These
subsidies can also inflate domestic goods lobby in a foreign market forcing producers from other
countries out of business. Also, domestic support policies such as paying subsidies directly to
farmers may harm production and trade by increasing the quantity produced and decreasing the
global price. They often impact the overall balance supply and demand in global markets since
they alter the market structures. The reality of the agricultural trade barriers shows that it was
rather easy to distort the international trade than provide it with a solid foundation; still, the
governments should come up with reasonable measures shielding their countries from unfair
competition. These barriers are the chief causes of the above discussed social concerns and
should be eradicated through cooperation between nations and proper trade relations between
developed and developing countries to provide a better market for agricultural production.
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Economic Impacts of Agricultural Trade Disputes
Tariff disputes in agriculture and exports could affect producers, consumer and entirely change
the nature of the market for the countries affected. From the producer’s perspective, a trade
dispute means that his/her companies will get limited market share, hence low revenues. This can
prove very devastating especially to the farmers in the developing world whose livelihood
wholly depends on export business (Dür; et. al. 2014). For consumers, the disputes make them
pay more for goods and services as well as be limited to the kind of products they can access in
the domestic market due to import restrictions. These deficiencies can further be pinpointed to
specific sectors, which may include staple foods as well as other necessary agricultural products,
thus putting into question a country’s food security and raising the general cost of living. Also,
trade tensions negatively impact the market and result in unpredictable prices and costs of
various supplies that players in the agricultural value chain experience (Gao, 2018). This is due
to fluctuations in weather patterns that can lead to tremendous increases of costs of goods and
services required in the operation of agricultural enterprises leading to poor planning, investment
and extreme risks. The macroeconomic effects include distortion of import and export patterns
and additional costs connected with searching for new outlets or meeting new barriers to trade,
such controversies may also be accompanied by countermeasures which only worsens the
economic relations and may culminate to trade wars beyond the agricultural sector. For example,
a crisis in selling farm produce can cause a counter measure which involves placing tariffs on
manufactured products, thus widening the problem. Ehlermann and Ehring noted in the long run,
negative trade relations can affect the frequent trade relationships and also the overall growth
rate of trade in the global market due to instability in the trade relations, this uncertainty can
create problems in encouraging investment and advance in agricultural field, thus slowing down
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the process of development. Hence, making trade disputes less costly, less time-consuming and
more impartial is very important and can go a long way in enhancing trade relations of countries.
Social and Political Consequences of Disputes
The impacts of trade disagreements in agricultural products are not confined in the area of
economics as societies and politics are known to be part of the repercussions. Economically,
these disputes can cause hardship in food insecurity because some countries rely on the other
countries with which they are in dispute to supply the food they need. These two effects can
cause households’ increased spending, which results in poor people experiencing poorer health or
increased levels of poverty that increases the level of malnutrition that people experience. In
vulnerable groups it results in negative consequences reaching significant levels that can cause
social tensions and the subsequent overloading of humanitarian organizations. In political aspect,
trade disputes could bring tension between countries and in some cases worsen its relations thus
giving rise to political conflicts. Governments often receive pressure from their domestic
agencies and organizations to safeguard their domestic industries hence come up with policies
that may exacerbate trade disputes. Public opinion and pressures from interest groups can also
play a large part in determining the trade policies implemented in democratic countries, this can
sometimes lead to the implementation populist trade measures that may not ultimately lead to
long term stability (Elsig, 2015). Such measures lead to reciprocal actions and protectionism
thereby compounding the complexity of relations between nations. Prolonged trade frictions
erode trust and credibility in the multilateral trading system such as WTO because nations lose
confidence in those organizations to address disputes. This loss of confidence might shift trade
relations from multilateral system to bilateral and regional means as countries search for new
avenues to conduct their external trade outside the conventional setting (Frankel 2018). Such
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shifts can disrupt the RTAs formation and the WTO, thus making it difficult to establish all-
encompassing and globally popular trade policies. Gradual disintegration process of global
institutions of GATT and the tendency towards regionalism creates challenges and disrupts all
attempts at developing approaches to solving multifaceted problems such as climate change and
sustainability, health care issues, etc. Hence, a resolution to the social and political side of
agricultural trade disputes remains necessary to foster stability for domestic populations and
countries all over the world.
Case Studies of Major Agricultural Trade Disputes
Examples of some of the complex and many-faceted agricultural trade disagreements are
provided below. By their nature, these conflicts can have serious consequences. In order to
illustrate the analytical issue at hand, one could potentially focus on the disagreement between
the United States and the European Union over the EU’s ban of hormone-treated beef. The EU
used health reasons to justify the ban while the US said it was a trade barrier that has not
scientific backing. This historical trade disagreement has taken more than two decades with
successive courtroom battles and counterstrikes such as imposition of tariffs on sundry products
from the EU by the US (Evenett & Fritz, 2019). This rather protracted conflict boils down to the
struggle of dealings with health standards, on one hand, and trade liberalization on the other.
Another typical example is the controversy between Brazil and the United States concerning
export credits on cotton subsidies, Brazil threatened to bring the US domestic support to the
cotton producers to the WTO court, stating that it was a form of trade distortion since it affected
the world market prices of cotton. Based on the WTO ruling in favour of Brazil and caused
major shifts in US policies regarding cotton subsidies and paying a settlement to Brazilian cotton
farmers (Dür et al., 2014). The given case sheds light on the effects of subsidies on the markets
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worldwide and WTO as an institution devoted to the regulation of trade. Similar to the conflict
on the agricultural tariff between China and US of the comprehensive trade war, the non-
agricultural and agricultural issues are again interconnected. The implementation of trade tariffs
in the agricultural sector especially on the soybeans and other related products has not only had
economic impacts but affected farmers and food supply chains within these countries (Evenett &
Fritz, 2019). The rational of a tit-for-tat approach precipitates disruptions in trade and market
conditions illustrating how damaging agriculture trade wars are capable of affecting other
sectors.
3. WTO DISPUTE SETTLEMENT MECHANISM
Overview of the Dispute Settlement Process
The Dispute Settlement Process of the World Trade Organization (WTO) is one of the most
important services of WTO that provides a predictable and smooth mechanism of trade, this
process was developed under the GUID and is meant to offer an equitable, speedy, and efficient
way of solving trade dispute among the members. The system promotes the use of consultation
and negotiations as the primary means of solving member’s disputes, should these attempts not
work out there is the next level of legal resolution by panels and the Appellate Body (Howse,
2016). The procedure is highly formalized and starts with a demand on consultations. If
consultations do not settle the conflict, the case is forwarded to a panel to review it. It also
consists of the filing of panel submissions by the two parties, holding of hearings, and issuance
of a panel’s report. There is an Appellate Body which hears appeals on legal issues concerning
the panel’s report and can affirm, reverse or remand a panel’s findings. Last of all, the Dispute
Settlement Body (DSB) approves the rulings and recommendation of the Appellate Body, as a
result, the member states involved are supposed to execute the findings of the DSB. This kind of
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structure helps in making the disputes follow a certain pattern that does not bring the issue of
disorderliness to the international trade system (Howse, 2016; Hufbauer & Jung, 2021). The
WTO’s DSM has proved beneficial in dealing and solving complex trade issues, it has a legal
base that ensures nations adhere to international trade laws. Since its operations involve a clear
set of rules and regulation, it minimizes on the occurrences of trading disputes making the world
trades more stable.
Consultation and Negotiation Phases
Consultation and negotiation stages are considered to be the first two in the WTO dispute
settlement process which is aimed at resolving the conflicts without having to go to court. If a
member of WTO thinks that another member of WTO has breached a WTO agreement, then this
member can ask for consultations which can be said to be the first stage of a WTO dispute-
settlement process and which in simpler terms is a sort of a meeting whose main aim is to find a
solution that is agreeable to all the parties involved. This phase is crucial as it helps the parties
clear the facts as well as the stand of each in a bid to end the dispute without necessarily
proceeding to the next level of the court trial (Gonzalez, 2019). If they do not resolve complaints
and disputes, consultations must be carried out within 60 days from the request’s receipt,
outlining a definite timeline for initial dispute resolution attempts. In these consultations, the
participants can listen to what the other had to say about an issue and present his or her case
supported by proximal evidence. If consultations cannot be effective in coming up with a
solution, then the complaining party can demand form the formation of a panel to make the
decision. Consultation in fact encompasses bargaining where people discuss possible
accommodations, modifying the business relations or other undertakings as well as seeking
methods of rectifying the concerns (Irwin, 2017). This phase further evidences WTO’s bias
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toward non-adversarial and negotiated resolutions in line with its objectives of fostering
diplomacy and coherence in the trade relations (Gonzalez, 2019). The WTO focuses on
consultations since it promotes that members resolve disagreements in reference to the laws by
consultations, thus helping to avoid ruptured relations and retaliation among trading nations. This
first is a critical stage of the WTO’s strategy because it attempts to prevent conflicts and ensure a
stable and predictable trading environment.
Panel Proceedings and Rulings
If consultation does not work, the next process is the panel process. = In a typical scenario, a
panel, which is usually made up of three independent trade specialists, is set up for the evaluation
of the case and, in accordance with the parties to the dispute and any third party that has a
substantial interest in it (Jackson, 2008). The panel process starts off with the filing of the
respective papers; in this context, the warring factions form their briefs. This is succeeded by oral
hearings where the parties expand on their stand and answer questions posed by the panel, the
panel is supposed to provide a balanced and impartial consideration to the case based on way of
facts and legal prepositions and come up with the report that reflect all phases of its work. This
report must either affirm the complainant’s assertion especially recommending corrective action
by the respondent or dismiss the complaint if the WTO rules were not violated. As highlighted by
the panel, decision making in relation to the matters before the organization is anchored on a
legal evaluation of all the information presented to the WTO together with the various
agreements that guide the organization. Therefore, the panel report is forwarded to all the WTO
members and since the DSB meeting is taken as the decision of the panel, it is adopted unless the
decision is appealed for by either of the parties involved. If there is no an appeal, the
recommendations of the panel become the next legal decisions and the loser has the obligation to
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follow the verdict. If the case is taken further to appeal, the matter is handled by the Appellate
Body which is charged with the responsibility of assessing the legal elements of the panel’s
determinations. The panel and Appellate Body decisions are useful in preserving the legal
framework of the international trade since WTO has many agreements that incorporate the work
of different nations (Jackson, 2008; Howse, 2016). Such procedures help to make trade
disagreements’ settlement more objective and transparent which strengthens the WTO’s dispute
settlement system credit and preserves the international trading system’s sanity.
Appellate Body Review
The AB review is thus an essential part of the WTO’s DSM, offering an additional layer of
appeal to avoid easily prejudiced and unbalanced determination. Either of the two parties
receiving the unfavorable decision of the panel may appeal the panel’s decision to the Appellate
Body under the following grounds: on points of law and the legal interpretations thereof
(Hufbauer & Jung, 2021). The AB is comprised seven persons who are independent experts in
law and international trade for the terms of four years. The review process is based on the legal
analysis of the panel’s report excluding the re-assessment of facts. Thus it assists to retain the
stringent and coherent direction to the WTO case law. The function of the Appellate Body is to
either uphold, reverse or remand the findings and conclusions made by the panel so as to ensure
that the final decision is the correct one in accordance with WTO agreements. The Appellate
Body may only recommend these measures or decide that this or with inclusion of article 21. 5
no measures are appropriate, which are then final and binding, provided that the Dispute
Settlement Body (DSB) adopts them. The function of the Appellate Body is to provide legal
basis for the consistency of application of WTO agreements hence contributing to the credibility
of the dispute settlement framework. This function is important because it ensures that there is
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order in the international trade relations, because for instance, there can be trade disagreements
which may result into long-standing economic and diplomatic standoffs. Though, factors like a
slow process of appointment changes and political pressures have emerged recently and
questioned its efficiency and use in the future. These problems could weaken the effectiveness
and efficiency of the WTO’s dispute settlement mechanism and therefore necessitate reforms to
safeguard such an important tool of managing international trade, it is imperative that WTO
addresses these challenges since members need to trust it and work together in order to achieve
WTO’s mandate of providing excellence in global trading systems.
Implementation and Enforcement of Decisions
The last and the final part of settled dispute at WTO can be considered as the implementation and
enforcement of the decisions. After a ruling has been made, it is mandatory for the parties of the
case to adhere to the recommendations within a reasonable time that is agreed by both the parties
or as set by the arbitrators (Hoekman & Mavroidis, 2021). It usually requires the alteration of the
measures that are in violation of the WTO rules so that actual benefits of the ruling may be
obtained. Where the designated party has not complied with the ruling stipulated within the
agreed period, the victorious party may file for reimbursement or request the DSB permit him or
her to apply the countermeasures inclusive of the trade embargos against the uncompliant
member. This enforcement mechanism helps in strengthening the principled nature of the WTO
by making sure that the decisions that have been made are implemented as planned (Hoekman &
Mavroidis, 2021; Howse, 2016). Thus, sanctions can be regarded as a form of sanction that
would prevent the members of the WTO from failing to meet their commitments given within the
framework of international trade agreements. However, the enforcement stage may also be a
cause of controversy, may expect new conflicts and can only be managed by the WTO’s
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persistent supervision (Hoekman & Mavroidis, 2021). Compliance is rather essential to the WTO
dispute settlement system because it proves that the multilateral trading system and the members
adhere to international trade regulations and principles. In Addition, through enforcement of
rulings, equality in the provision of concessions and benefits constituted in WTO agreements is
maintained thus increase efficiency in fairness of competition and stability of trading
partnerships. However, some difficulties related to the enforcement phase like long-lasting non-
compliance, or even possibility of escalating measures, prove that a continuous and cautious
monitoring, and maybe some reforms, can be useful for improving the overall functioning of the
dispute settlement system.
4. KEY WTO AGREEMENTS AFFECTING AGRICULTURAL TRADE
Agreement on Agriculture (AoA)
The General Agreement on Trade in Services (GATS) which is a member of the WTO is aimed at
liberalisation of agricultural trade internationally. Signed in the Uruguay Round, the AoA has
targeted at making changes to some of the existing policies in agriculture so as to provide the
benefits of the intended trading system. The three keys of the trade negotiations that are trade
related aspects of environmental issues include; Market access, Domestic support and Export
competition (Meléndez-Ortiz, Bellmann & Hepburn, 2019). Market access can be defined as the
process of lowering tariffs eradicating non-tariff barriers and thus allowing more products in the
form of agricultural produce to flood the foreign markets. This pillar looks at turning NTBs into
tariffs and then proceeding to tearing them down to practice free trade. The domestic support
pillar divides subsidies into the ‘boxes’, with the most trade distorting being the amber box
followed by boxes that have lesser trade distorting effects being the blue box while the green box
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having the least or no trade distorting effects (Lester et al., 2018). This classification system in
intended to target subsidies which are considered as potentially distorting trade by altering the
prices of goods in the market. The export competition is the pillar by which the nation seeks to
minimize export subsidies as it works to eliminate practices that increase the levels of
competitiveness of a country’s agricultural exports, this is aimed at making a levelling of the
commercial playing ground in world market by eliminating subsidies which allows countries to
offer their agricultural products at subsidized prices. A common criticism of the AoA has been
that this plan has not changed the problem of true market liberalization as it permits developed
nations to continue providing high support to their farmers (Lang, 2019). These criticisms throw
the world trading system with a bias of developed and the developing countries which clearly
depicts the differences in power and resource endowments. The role of the agreement is to
provide the standards that govern trade in agricultural products but that requires on-going
reforms to fill gaps and changing global trade environment (Meléndez-Ortiz et al., 2019).
Maintaining that the AoA is relevant to the WTO’s member countries, especially the developing
ones, poses one of the major tasks for the future.
Sanitary and Phytosanitary (SPS) Agreement
The SPS Agreement being one of the most important WTO agreements is aimed to make sure
that the members’ measures concerning food safety and animal and plant health are not used to
encoded an international trade. According to the SPS Agreement, countries are allowed to
implement their own standards under certain conditions; such standards must be scientific-based
and should not be favouring or discriminating specific countries when conditions in the affected
countries are similar (Lester et al., 2018). To this end, this agreement cherishes the use of
international standards, guidelines, and recommendations especially those evolved by the Codex
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Alimentarius Commission, the World Organisation for Animal Health (OIE) as well as the
International Plant Protection Convention (IPPC) accord Lang (2019), such organizations offer
standards through which they can assist in the synchronizing of safety and health practices
internationally, thus enabling easier trade. The primary purpose of the SPS Agreement is to
ensure WTO members’ right to protect human, animal and plant life and health while making
certain protectionism, which is masked in the guise of health and safety concerns, is not
encouraged. Public health and fair trade are two aspects which are very important in this world
and need to be introduced in a balanced manner. The SPS disputes are generally underpinned by
scientific and technical evidences which makes the process of examination and evaluation of
facts comprehensive and require contribution from specialists. Science based regulation means
that in the process of developing, implementing and enforcing the regulation, emphasis is on the
safety of trade in agricultural products, which is important for fair trade on the international
market; nevertheless, it is to be mentioned that application of science-based regulation may result
in trade conflicts due to the difference in national standards of acceptable risks (Messenger,
2020).
Technical Barriers to Trade (TBT) Agreement
TBT provides for the regulation of the standards that nations may use in the conduct of their
trade to attain ends which are logical and acceptable including the protection of health, safety
and the environment. The TBT Agreement aims at making sure that the theoretical and practical
aspects of technical regulation or standards; or the procedure for conformity assessment should
not become a source of technical barriers to trade (Lee, 2019). It has brought support for the
implementation of the international standards as the foundation of the domestic regulations and
advocate for transparency and nondiscrimination in regard to the formulation and application of
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the technical measures. Under TBT Agreement, each member country is required to inform the
WTO of any proposed technical regulations that may have an impact of the trade and also afford
other members equal opportunity to present their opinions on it (Lester et al., 2018). This
transparency mechanism assists in avoiding the creation of unjustifiable structures of trade
obstacles. Also, there are also requirement of science-based and no more trade-restrictiveness in
the formulation of technical regulations under the TBT Agreement, this principle makes sure that
technical regulations cannot be used as a veil for trading restrictions in the international market.
Nevertheless, there are cases when it is rather difficult to meet the express obligations of the TBT
Agreement because of the variety of national standards and intricacies of technical regulations.
Most TBT Agreement cases are based on claims, which hold that a certain technical regulation is
more trade — restrictive than is necessary for the fulfillment of the objective pursued. The
dramatic increase in the number of RTA and WTO members’ notifications under the TBT
Agreement clearly indicates that the latter serves as an important instrument of promoting the
harmonization of international trade, modernization the dissemination of technical regulation and
standardization, and checking the misuse of technical measures for protectionist ends (Lang,
2019). In a broad sense the TBT Agreement fosters a known and equitable trading environment
due to its function in advertising and maintaining international standard and through influence on
the formulation of a framework for the settlement of disputes, this in turn helps global trade by
decreasing the prospects of trade conflicts as well as improving cooperation between WTO
members. The measures have contributed significantly towards the realization of legitimate
regulatory objectives while tending to the desire of avoiding trade interventions.
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Trade-Related Aspects of Intellectual Property Rights (TRIPS)
The TRIPS Agreement is an all-embracing treaty under the WTO framework which deals with
the minimum standards of Trade-Related Aspects of Intellectual Property Rights (TRIPS), the
TRIPS Agreement in fact embraces IPRS such as copyrights, trademarks, patents, geographical
indications, industrial designs and trade secrets (Lester et al., 2018). Among its goals is to
eliminate unnecessary and arbitrary complications and restrictions to trade either through
adequate IP protection on the one hand, or through the processes of enforcement on the other
hand. In this regard, TRIPS should make international trade predictable for goods and services
that rely on intellectual property where through setting standard it achieves this aim. This is
because the agreement provides for legible exemptions, such as compulsory licensing to enable
the improvement of public health by enhancing the access to vital medicines for users
(Messenger, 2020), such provisions have particularly taken significance in assisting the
developing countries in combating the health risks that confront their populace without violating
the principles of the WTO. The TRIPS Agreement has helped put some order in the IPR
standards in the WTO member countries while offering legal protection of innovations and
creative products across the world, though it has led to extensive discussion and controversy:
among all the aspects such as the access to medicines in the third world nations and the conflict
between proprietary interests and the public interest (Lang, 2019). Arguments against strong
IPRs are made in the grounds that they hinder people in the developing world access affordable
medicines, agri-products and technologies and thus increase inequality, the former argues that
strong IPR protection stimulates creation and investments and is good for the world economy.
TRIPS Agreement is one of the most pivotal interfaces of trade and IP law as it affects almost
every single trade and policy making strategy and policy in the global economies today
P a g e | 21
(Messenger, 2020), it remains a work in progress, with member states adjusting the various
components of the system regarding the extent to which they want to protect innovation and how
urgently they need the drugs, vaccines and technologies to tackle urgent public health and
development challenges. The role of SPS Agreement is crucial in the clarification of the
transparency and predictability of the trade across the international markets, members have to
inform the WTO on any new or changed SPS measures and the chance to talk or
negotiate. Although the purpose of such an agreement is to remove the unnecessary restrictions
for the exchange of goods, the success of the WTO needs the active interaction and cooperation
of its members. For this reason, it occupies a significant post in guarding health and in
administering the food safety standards with equal criteria all over the worldwide markets.
Subsidies and Countervailing Measures (SCM) Agreement
The SCM Agreement governs subsidies and activities that nations engage in to counterbalance
the impacts of subsidies in the international market, the SCM Agreement classifies subsidies into
three categories; They include prohibited measures, actionable rebalancing right, and non-
actionable rights (Mavroidis, 2016). Contingent subsidies which are prohibited and hence should
be withdrawn as soon as possible are the subsidies that involve export performance or the
domestic good over the imported one. These subsidies are considered the most trade restrictive
because they distort export levels or domestics goods. SS 2 the actionable subsidies on the other
hand, can be denials if they produce unwanted consequences such as, causing injury to the like
products of the subsidizing state, if they negate or impair the benefits accruing from the bargain,
or that the situation in the subsidizing state is prejudicial to the interest of the other member. If a
subsidy according to this, falls under this category then it has to be eliminated or it’s impacts
have to be addressed somehow (Lester et al., 2018). The non-actionable subsidies that were
P a g e | 22
previously allowed under specified circumstances mainly related with research and development,
regional development and environmental factors etc are not present as this particular
classification was ended in 2000. This came as a result of expiry of non-actionable subsidies
which consequently decreased the safe harbors on subsidy practices that might otherwise be
given. It also encompasses measures for the application of countervailing duties which enables
members to investigate and apply countervailing measures on subsidized products that are
injuring the members’ domestic industries. This includes specifics of the initiation and pursuit of
investigations, standard of proof, and use of CVDs (Messenger, 2020). The SCM Agreement is
an essential instrument of preserving the fairness of the global trade environment by regulating
the subsidies’ use and offering tools to counterbalance their negative impact, the function enables
it to prevent situations where subsidies favor producers in one country as compared to producers
in the other country, however, its application is frequently accompanied by legal and economic
analysis and it is considered to be one of the hot-button issues of WTO law. The identification of
subsidization harm and the right remedy is complex in some cases and therefore, can cause a
number of controversies among WTO members (Lang, 2019, pp. 24). Nevertheless, it is
imperative to note that the SCM Agreement is very significant in entailing and maintaining a
parity across the global trade market.
5. WTO'S HANDLING OF SPECIFIC AGRICULTURAL ISSUES
Overview of the Dispute Settlement Process
Dispute Settlement is one of the critical functions of the WTO, it aims at providing predictability
to the international trade, set under the understanding on Rules and Procedures Governing the
Settlement of Disputes (DSU), the purpose of this process is to adjudicate a fair, fast and efficient
P a g e | 23
method of solving trade disputes with other member countries, the system pushes the members to
deal with the disagreements through consultations and negotiations as a way of avoiding
litigation. If these efforts fail, the process goes to the panel and the Appellate Body stage of the
system (Howse, 2016). The process is very rigid starting with consultation which enables the
parties to the dispute address the problem and possibly solve it to their mutual satisfaction,
should consultations fail within a period of 60 days, the complainant may request for setting up
of a panel in order to determine the dispute. The panel comprises of a group of non-employment
specialists who analyze the case, examine the evidence and produce a report that contains
findings and recommendations, if either party is not content with the panel’s findings, the matter
can be taken to the Appellate Body on matters of law and legal interpretations only (Hufbauer &
Jung, 2021). The Appellate Body is composed of seven persons having background in law and
international trade law and is charged with examining the legal issues of the panel report, with
the powers to affirm, vary or reverse the panel’s decision. After making their decision, the
Appellate Body’s decision is approved by the Dispute Settlement Body meaning that the decision
made is final. The last process is about the execution and realization of the ruling, whereby the
loser has to execute it in a reasonable time-frame. In the case where compliance is not obtained
by the mentioned deadline, the prevailing party can claim damages or apply for permission to
implement countermeasures (Howse, 2016). There is always a structure of how these
disagreements should be solved hence keeping the world trading system as a logical structure.
Note that it offers a legal foundation that ensures that international trade gives emphasis on the
principle of the WTO, which strengthens the structure of legal engagement while displaying
stability among WTO members (Hufbauer & Jung, 2021).
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Consultation and Negotiation Phases
The ordinary course of procedure and consultation and negotiation stages forms part of the WTO
DPS, which focuses on the diplomatic than on less strictly legal means of conflict solving. If a
member country feels that another member has violated a WTO agreement, there are
consultations that are formal negotiations that are expected to seek a solution (Gonzalez, 2019).
Employer did not act appropriately according to the regulation stipulating that such consultations
need to start within sixty days of the request, which underlines time-sensitive processes in the
contentious approach. However, it has been found that the essence of this phase is in getting to
know the facts, the positions to be held, and possible solutions in order to reduce the necessity of
further legal measures (Irwin, 2017). It involves claims and counterclaims of changes in the
business relations or bearing in mind compensations after that consideration is made, in light of
the WTO’s inclination towards negotiated outcomes that consist of mutual benefits and call for
stability in international trade relations (Gonzalez, 2019). Nevertheless, if disputes cannot be
solved through consultations, the complainant can proceed to request formation of an official
panel to hear the matter. This escalation is the process of moving the conflict to the organized
legal fight within the WTO framework of the dispute settlement. Nonetheless, WTO’s dispute
settlement process takes cognizance of the fact that there is always a legal redress available for
any party in the event that the normative diplomatic process for resolving the disputes proved to
be ineffective in resolving the disputes in a WTO, and this makes it conform to the principles of
international relations that have law as the basis for reformation of conflict.
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Panel Proceedings and Rulings
Consultations cannot lead to appeal and therefore, the proceeding to the next level when a
conflict arises in the WTO is the formal panel. An ad hoc panel, usually comprising of three
members of the requests’ respective trading partners, is set up to review the case according to the
submissions of the interested parties as well as any third parties that may be interested in the case
but do not have a direct stake in the trade relationship (Jackson, 2008). The panel process
commences with the filing of written briefs for parties to put down their case and support it with
facts. This is followed by the oral hearings where the parties engage the panel directly in the
presentation of their cases, this body’s task is to provide a fair and comprehensive examination of
the serious disagreement on the merits of the case, factual aspects and the applicable WTO rules,
it then provides a detailed report to the panel once the review has been completed to indicate the
results and suggestions. In line with this, the function of this report is to either affirm the
complainant account with recommendations on how the respondent should change his attitude to
conform with the WTO regulations or dismiss the complaint where it will not be seen to have
violated any WTO regulations. Then a report is compiled and presented to the panel composed of
three members, which is then forwarded to all WTO members which then forms part of the
public records. The Dispute Settlement Body which is made up of all the WTO members usually
approves the panel report though one of the parties can contest the decision and request for the
appeal. A panel ruling is very essential in the function of the WTO or GATT since they give
clarification on any WTO agreements, and the panel’s responsibility is to ensure that all WTO
decisions are implemented as agreed (Jackson, 2008), they provide stability to the relations in the
international trade by determining the trade relations according to legal rules and factual
evidences.
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Appellate Body Review
The Appellate Body (AB) review is an integral part of WTO’s DSM which works as the second
tier for the settlement of disputes for a comprehensive and fair determination of the case. If either
the complaining or the defending member is dissatisfied with the panel findings, then the
member can appeal to the Appellate Body on issues of law and legal interpretations (Hufbauer &
Jung, 2021). The AB’s currently constituted of seven members serving a term of four years and
all members must have a background in law and international trade. In contrast, the Appellate
Body reconsiders the aspects of the case in the light of fact-related aspects under the panels’
scrutiny but only reviews the legal claims brought by the parties to the dispute. The challenges
cause the Appellate Body to make, reverse or alter the legal interpretation and conclusions made
by the panel when undertaking its review, its decisions are considered; final and; legally binding
provided they are accepted by DSB that is made up of all WTO member nations. The primary
role of the Appellate Body is to guarantee legal certainty through the reinforcement of the equal
importance of WTO agreements and MICs’ commitments This contributes to the main goal of
the WTO’s DSB, which is to increase the credibility and reliability of the WTO’s Dispute
Settlement Body. However, in recent years it came up with some problems, such as the lack of
new members and political pressures on it (Goldstein & Gulotty, 2021), these issues have elicited
some apprehensions as to the efficiency and sustainability of the Appellate Body in preserving
the viability of the WTO dispute settlement mechanism.
Implementation and Enforcement of Decisions
The last of the WTO operational structures is therefore on the implementation and enforcement
of the findings of the dispute settlement which is under the Dispute Settlement Body (DSB). As
P a g e | 27
soon as the ruling is made the party in the wrong is legally bound to follow the recommendations
as laid down in the decision within the due time which according to the terms of consent or in the
event of a dispute by consent or arbitration as agreed by the two parties (Hoekman & Mavroidis,
2021). The fact that implementation mainly entail modifying or removing the measures that are
considered to be a violation of WTO rules, this aspect ensures that all the advantage accrued to
the complainant are fully felt. If the said party has not complied with the ruling within the
stipulated period, the winning party can claim recovery of expenses or ask the DSB for
permission to place trade measures tantamount to sanctions against the particular member. The
primary focus of this enforcement mechanism is to guarantee that the rulings made by the
WTO’s institutions are followed by member countries to sustain the principles of the rule of law
(Hoekman & Mavroidis, 2021; Howse, 2016). Whereas sanctions act as such a threat, the
enforcement stage is another stage that is usually characterized by quarrels and difficulties. Such
implementation issues are likely to create further conflict on their usage hence, a continuous and
close monitoring and solving of any existing issues by the WTO. This can only be achieved by
constant follow up and operations to ensure that the WTO Dispute Settlement system remains
relevant and the ITA provisions are effectively implemented to provide fairness when addressing
international trade disputes.
6. CHALLENGES AND FUTURE OF WTO IN AGRICULTURAL TRADE DISPUTE
RESOLUTION
Criticisms of the WTO Dispute Settlement System
Challenges to WTO’s Dispute Settlement System over the years, the WTO’s dispute settlement
system which is one of the key components of the contemporary global trading system has faced
P a g e | 28
major criticism in terms of efficiency and equity. One major criticism is the specialization of
developed countries due to high costs of litigations and structure of the system Disputed.
According to the critics, these elements reduce the capacity of the less economically developed
countries to engage and enhance their standing and defend their interests in a given dispute (Van
den Bossche & Zdouc, 2017). Another major concern is the Appellate Body the seventh innings
of which has been criticized for making law beyond its authority. Some of the member states
have criticized the functioning of the Appellate Body stating that occasionally, the WTO is
creating new norms that it had not envisioned when entering the treaty and expanding on the
obligations of the member states where it has not been the intention of the majority members
(VanGrasstek, 2013). This has earned criticism towards the Appellate Body since it is considered
to be overstepping its mandate and hence the legitimacy of its decisions comes into question.
Moreover, critics are also quick to note that the WTO’s dispute settlement system is time-
consuming and slow in the handling or the delivering of justice. More worrying has been the
paralysis of the Appellate Body since 2019 mainly because the United States has been blocking
the appointment of new judges. This has created a pile of pending cases and it has again raised
doubts in the member states on the efficiency of the system to deliver justice as and when needed
(Wolfe, 2015). Performing multiple tasks is vital for the WTO since these criticisms can
demoralise the negation and weakens its authority within global commerce, some adjustments
are required to improve the effectiveness of the reform in increasing the transparency and
fairness of the process, as well as continuing the search for efforts to strengthen the organ’s
effectiveness and authority, taking into account the equal and non-discriminatory rights of all
member states, including the economic giants.
P a g e | 29
Developing Countries' Participation and Concerns
Some of the complaints heard from the developing countries have been regarding perceived
distortions of the WTO Dispute Settlement System that seem to put them at a disadvantage in the
WTO trade negotiations. Even though they can rightfully be considered as the WTO’s direct
stakeholders, these nations frequently fail to possess sufficient financial capacity and
professional knowledge required for efficient addressing of legal and procedural challenges
within the WTO framework (Van den Bossche & Zdouc, 2017). For this reason, this
disadvantage is felt even more strongly in matters of agriculture, where the developed countries
have the legal and financial muscle to put up strong defenses and to protect their interests. The
developing countries complain they have not benefited from the multilateral trading system as
was expected because they still find it difficult to penetrate into the relevant markets despite
agreements reached, which opened for trade liberalization (Trachtman, 2018). Another aspect of
this imbalance is the arrest of the Doha Development Agenda meant to correct these imbalances
has further fueled sentiments of the developing nations about the ineffectiveness of WTO system
in catering the needs of the developing nations. Assertions for more technical cooperation or
capacity building projects are heard much louder as many developing nations strive to improve
their capability in WTO’s dispute settlement mechanism and are campaigning for changes in
order to make the WTO more democratic to deliberate on the world trade affairs, overcoming
these difficulties is significant not only for creating a desirable climate that enables fair trade, but
also for proper formation of economic globalization and mitigation of worldwide inequalities
regarding international commerce.
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Impact of Regional Trade Agreements on WTO's Role
This is manifested by the increasing number of regional trade agreements (RTAs) which have
redefined the structure of the trade governance and creating an environment of uncertainty in the
WTO. For instance, the TPP and the RCEP are not typical RTAs with the WTO, but they go
further to other WTO agreements to incorporate some items such as investment, protection of
intellectual property and digital trade among others as positioned by Voon (2015). Such an
expansion may lead to the dystopia of a disintegrated trading system in which nations play in
different rules than what has been envisaged in WTO’s multilateral format. Furthermore, the
bilateral nature and openness of RTA negotiations differs from the long multilateral WTO
negotiation rounds and hence the promotion of RTAs is popular among countries agitating for
speedy trade liberalization. However, this trend will problematize the general tendency to erode
the WTO’s dominance as the focal point of and the rule-maker as well as the rule-keeper of
global trade rules and leads to questions about fragmented and concurrent rules within different
trade agreements. To keep its role vibrant in the international trading system, it can only
accommodate and integrate these new trade concerns into WTO legal framework to ensure that
there is consistency between multilateral and regional trade regulation. This adaptation is
essential to keep the WTO functioning stable to remain the rule-maker for international trade
relations and to guarantee that international trade will stay open, transparent, and properly
managed for the benefits of WTO member countries, on the East as well as on the West, large or
small, developing or developed economies.
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Reforming the WTO: Proposals and Debates
In reaction to WTO’s current issues, there are now debates that have been deemed necessary to
reform the WTO to its members, scholars, and trade experts. One of the major focal points of
WTO reform relates to the body’s dispute-settlement mechanism. Recommendations are made to
rationalize measures to speed up the disposition process, improve the openness of the decision-
making systems and to seek resolutions to several problems, which have caused the paralysis of
the Appellate Body; for instance, fear of exceeding its jurisdiction as a judicial institution
(Hoekman & Mavroidis, 2021). Another rather large number of suggested changes implies
altering the nature of decision-making processes within the WTO in order to make them open
and fast. It might involve decreasing the focus on the consensus as a decision-making model and
considering other voting systems to ensure faster decision-making concerning the contentious
issues (VanGrasstek, 2013). Moreover, currently there is a drive to refresh the WTO rule book in
view of the current characteristics of the trading environment. It entails, for example, provisions
regarding issues such as e-commerce, digital trade and environmental standards, which are more
relevant in today’s world economy (Wilkinson et al., 2016). Many of these reforms are
established with the twin goals of updating the WTO and of making sure it is still relevant for all
164 of its current member countries, with specific attention paid to VO nations in particular.
Nevertheless, most an attempt to achieve consensus on every one of these reforms remains a
herculean task. The WTO functions with a centralized system that meets the consensus standard
when making all its decisions whereby all the member states must agree. This usually results in a
lengthy process of bargaining and agreeing on propositions due to the many economic, political,
and social interests of the members of this organization (Wolfe, 2015). To surmount these
P a g e | 32
challenges there will be a necessity to reawaken the WTO and stabilize the organization’s
importance in the existing system of world trade relations in the mid of the 21st century.
Emerging Issues in Agricultural Trade and WTO's Adaptability
New developments in agricultural trade present core concerns and prospects of the organisation
with regards to flexibility, one such pertinent topic of discussion is Climate change since it has
deep effects on Agricultural yields and trade facilities across the world. Currently, the WTO is
challenged with the responsibility of coordinating trade policies that not only ease the restrictions
to market access but also advance sustainable agriculture as well as minimize on the trade
externalities or effects to the environment. (VanGrasstek, 2013) Another relatively new issue is
the fast development of biotechnology especially in GMOs leading to questions about the
suitability of current measures under the SPS and TBT (Petersmann, 2019). In addition, the new
forms of digital agriculture and increasing use of data creating technologies also call for changes
in trade rules so that fair protection of intellectual property rights and competition can be
provided (Shaffer, 2019). The current COVID-19 pandemic also demonstrates the importance of
having trade systems that can withstand difficult and challenging times, as well as the WTO’s
function to strengthen frameworks for crisis management and recovery (Gruszczynski, 2020).
Solving these gradually rising issues can only be made possible by the adaptation of WTO rules
and practices to always suit the international trade needs in regard to agricultural produce with a
focus on sustainability and inclusiveness (Hoekman and Mavroidis, 2021).
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