ENACTMENT OF PUBLIC INTERNATIONAL LAW IN INSTRUMENTS AND
WORLD TRADE ORGANIZATION PRACTICES
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Introduction
The establishment of the World Trade Organization (WTO) in 1995 is considered by
many to be a decisive beginning in creating a rulebased system in trade relations between
countries, in contrast to the General Agreement on Tariffs and Trade (GATT) agreed in 1947
which was more characterized by diplomacy. The question that arises next, especially among
academics, is what law governs the various activities in the WTO system, national law or
international law. The answer, of course, is international law, but which international law? Is
it traditional international law "tradition continued or new frontier?", or new international
law, as one writer asked.
Apart from international law, other authors see that the role of law is so great in
international trade relations governed by the WTO that they call it "the most important
change in the jurisprudence of the global economy in the second half of the twentieth
century".1 Meanwhile, former WTO Director General Mike Moore seems to appreciate the
WTO dispute settlement system so much that he calls it the "crown jewel" of the multilateral
trading system, while Peter Sutherland, former Director General of the WTO, calls it the
"crown jewel" of the multilateral trading system.
Discussion
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school Some scholars in International Law argue that freedom
of commerce is a natural right, but they interpret it more narrowly in the sense that it is
subject to a number of exceptions. In practice this means that freedom of commerce is limited
by the boundaries of a state's absolute jurisdiction. Therefore, there is only one way to realize
this natural right, and that is by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school Some scholars in International Law argue that freedom
of commerce is a natural right, but they interpret it more narrowly in the sense that it is
subject to a number of exceptions. In practice this means that freedom of commerce is limited
by the boundaries of a state's absolute jurisdiction. Therefore, there is only one way to realize
this natural right, and that is by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
Public International Trade Between Nations
Advocates of the Natural Law school
Some scholars in International Law argue that freedom of commerce is a natural right, but
they interpret it more narrowly in the sense that it is subject to a number of exceptions. In
practice this means that freedom of commerce is limited by the boundaries of a state's
absolute jurisdiction. Therefore, there is only one way to realize this natural right, and that is
by entering into an international treaty.
There are a number of principles used in these international treaties as Georg
Schwarzenberger points out.3 Some of them are of particular importance, namely:
Minimum Standard Principle; This principle is widely used in various treaties with the
intention of providing security guarantees for foreign traders, both for their jurisdiction
and for their livelihood. In its development, this principle has become part of customary
international law and thus applies to all foreigners. It has made a major contribution to
the regulation of international tort. For example, a state can be sued for failing to protect
a foreigner's personal safety and property, denying him access to the courts or imposing
excessive taxes.
Standard of Identical Treatment; Ancient monarchs gave each other assurances that
they would give similar treatment to all their merchants. Such treatment may be applied
narrowly or broadly in the economic relations of their countries. For example, in the
course of a trade agreement two monarchs might guarantee that their merchants trading
in the territory of the other monarch would be exempt from military service or they
might guarantee each other freedom of trade in various areas of economic activity.
Standard of National Treatment; This refers to equality of treatment within a country,
so that treatment of foreigners is the same as treatment of nationals. For example, the
same sales tax is levied on similar products sold by foreigners as those traded by
nationals.
Most FavoredNation Treatment; According to this principle the state provide the same
treatment as that accorded to third countries. In its unconditional form the good of the
principle is that it grants to all treaty participants the benefits that one of them grants to
the other. It applies regardless of the socio-political and economic structure of the
contracting states. This is the main reason why this principle has endured throughout
history and is widely practiced. For example, if in the framework of a m u l t i o n trade
agreement, country ` A` imposes a 5% tariff on imported products from country B, then
that level of tariff must also be applied to similar products from other countries party to
the agreement.
Preferential Treatment; This principle is the opposite of the principle that gives equal
rights to all parties. In a broad system of international relations, these two systems cannot
be applied simultaneously but can be harmonized, for example by the regulation of
exceptions to the MFN principle against certain countries or against fellow members of a
free trade area. For example, among countries in a certain region (such as AFTA), lower
tariffs are imposed on each country's products imported into other countries in the region,
compared to the tariffs on other countries' products imported products from countries
outside the region.
Standard of equitable treatment; This principle is applied to areas affected by a
country's policies. It provides a way out where there is a currency imbalance or a
change in the economic structure of the country that has forced the country to adopt
import restriction policies. In such circumstances, this principle is the only way to
enforce MFN and achieve proportionality among countries. For example, if a country is
experiencing balance of payments difficulties, or its domestic market is disrupted due to
the flooding of a certain product from other countries, it can restrict the import of goods
that are considered to cause such harm. Such restrictions on certain products apply to
imports from every country party to the agreement.
Public International Law Provisions in WTO Documents Principles of Economic Law
These international classics were more or less adopted in the GATT 1947 which later
became part of the WTO Agreements, which after being combined with the results of the
Uruguay Round, is commonly called the GATT 1994. For example, the MFN principle is
included in Article I, which is linked to a number of other articles, such as Article II and IV
on taxation and national legislation. Article V (5) on freedom of movement, Article IX (1)
on the origin mark and Article XIII (1) on the implementation of quantitative import and
export restrictions. For example, if a country restricts the import of a certain product, then
this restriction must be imposed on the product from any country of origin.
Standard of Equitable treatment; Countries with balance of payment difficulties may
impose quantitative import restrictions. However, in implementing this policy, consideration
must be given to the share of trade that other contracting states would have enjoyed had there
been no such quantitative restrictions (Article XIII-2d). Equality of treatment can only be
realized on the basis of proportional equality of degree.4
Standard of National Treatment; This principle is explicitly stated in Article IV
regarding a country's national taxation arrangements. Discriminatory actions in the field of
taxation will eliminate the benefits of concessions given by countries to each other in the
field of tariffs. This principle is also contained in Article V on freedom of transit.
Minimum Standard; This principle is evident from the provisions of Article X(3). State
parties shall promptly take legal or administrative action to review or correct customs
measures. This provision implies that there will be an objective and impartial review of a
government action. It also requires that governments provide a certain minimum of fairness
and judicial protection to foreign persons or enterprises and not merely allowed in the GATT
in the form of exceptions. One of these exceptions is given to developing country members
of the GATT as for example stated in one of the agreements reached during the Tokyo
Round which is commonly called the enabling clause In addition, this principle is applied in
a regional grouping of countries as stipulated in Article XXIV.
A number of Articles in WTO documents expressly mention provisions known in
international law. For example, Article VIII of the Marrakech Agreement Establishing the
World Trade Organization states that the WTO has legal personality, has privileges and
immunities in carrying out its functions. These privileges and immunities are similar to
those guaranteed in the Convention on the Privileges and immunities of Specialized
Agencies, approved by the UN General Assembly on 21 November 1947.
Public International Law in WTO Practice
This subheading implies the question to what extent is public international law as
embodied in the WTO documents implemented and respected? The fact that the WTO has
been in existence for almost fifteen years, and that the WTO system is a refinement of the
1947 GATT system in a more legalistic direction (rulebased system) is an indication that the
majority of its member states abide by the rules that are the "rules of the road" of
international trade, and that the WTO is a legalistic system. The role of public international
law will be prominent when violations of rules and disputes among members reach the stage
of legal settlement at the Dispute Settlement Body (DSB). Therefore, in this section the
author will discuss the extent to which public international law plays its role in the dispute
settlement process before the DSB.
During the existence of the Dispute Settlement Understanding (DSU) from 1995 to
January 1, 2009, the WTO Secretariat recorded no less than 388 complaints by members
against other members. In accordance with the WTO dispute settlement procedure (DSU)
some of these complaints will be examined by Panels and even Appellate Bodies. As of 2004
alone, the DSB has produced decisions that have enriched WTO law with no less than 27,000
pages of legal decisions parties, and is expected to end the dispute without having to proceed
to a panel process. In fact, the DSU states that the purpose of the dispute settlement
mechanism is to reach a positive settlement. Preferably a settlement acceptable to both
parties that is in line with WTO agreements.
How the consultation is conducted depends on the parties. Although consultation is not
defined, statistics show that about half of the issues brought to consultation are either
resolved at that stage, or simply abandoned. So approximately half of the cases that arise are
resolved through consultation.
The DSB consists of The dispute settlement process at the WTO can be described as
follows: There are four stages of the dispute settlement process at the WTO, namely the
consultation process, the panel process, the appeal process, and the process of monitoring
the implementation of the decision. First on consultations: One WTO member can request
consultations with another member if the complaining country feels that the other WTO
member has violated WTO rules or has nullified or impaired its benefits. The purpose of the
consultations is to enable the disputants to better understand the background of the dispute,
the legal claims, and the reasons for the dispute of all WTO members. It is the WTO body
responsible for running the dispute settlement system. According to the provisions of the
DSU, upon request the DSB must establish a panel to examine the dispute at the second
meeting at which the request is made, unless there is a consensus to the contrary (no panel).
The panel's task is to make an objective assessment, including analyzing the facts and legal
issues.
Another aspect of international law practiced at the WTO is the relationship between
national and international law. In the case of India Patent Protection for Chemical
international agreements must be interpreted Product,19Appellate Body follows The
Permanent Court of International Justice ruling in Certain German Interests in Polish
Upper Silesia, that the Panel cannot simply interpret national law, but can scrutinize national
law for the purpose of determining whether a Member has fulfilled its obligations under the
WTO Agreement.
The issue of state responsibility has been raised and decided since the GATT 1947 more
broadly. Pauwelyn, for example, mentions that with perhaps only one exception, not a single
author (as well as WTO rulings and documents) has questioned WTO rules as part of the
broader corpus of public international law.
With regard to the dispute settlement system in the GATT and the WTO, the author
argues that basically what is practiced in both systems has long been known in international
law, especially in international dispute settlement law, even though there are a number of
differences and features.
Is WTO Law New International Law?
There seems to be little doubt among academics and WTO practitioners that WTO law is
part of international law. This difference is at two levels, namely the theoretical and practical
levels. At the theoretical level, international law and international trade in a number of
important aspects are based on different assumptions. The organizing principle of the
international trade regime is the liberal trade theory of comparative advantages, while
international law is based on the concept of state sovereignty. In other words, international
law is founded on the fundamental construct of a society of sovereign states whose relations
with each other are the substance of the discipline - while international trade contradicts this
construct and in many respects the concept of sovereignty even gnawing on it.
International trade law seems to require the state to do the opposite of what a regime
based on sovereignty would want. In a system based on sovereignty, the state will seek to
protect the interests of those inside even at the expense of those outside the state. This
distinction between the rights of citizens and foreigners - favoring citizens over foreigners -
is central to the purpose of the state embodied in the notions of citizenship and nationality.
The state pursues its national interests. However, in international trade, this pursuit of
national interest can be interpreted as protectionism. Differentiating between products
produced by citizens and those produced by foreigners is contrary to the liberal trade
principles that the WTO seeks to uphold.
International trade law increasingly encroaches on areas traditionally under the
jurisdiction of national law such as subsidies, technical barriers to trade, sanitary and
phytosanitary measures, all of which reduce national space and options.
On a practical level, Mc Rae points to a "new frontier" in international law. For example,
the WTO dispute settlement mechanism is not unique, but what is unique is that it is
mandatory for all WTO members and its decisions are "final and binding". The dispute
settlement mechanism not only resolves individual members' disputes, but lays the
foundation for the development of international trade law through judicial rulings, and
provides a forum for the development of international trade law application and refinement
of international legal concepts and doctrines. The interpretation of the WTO agreements is an
active law-making process. Meanwhile, Petersmann26 points to an international economic
law revolution that can be used to strengthen international dispute settlement mechanisms
including in non-economic areas.
Conclusion
That public international law has an important role in organizing world trade as
implemented by the WTO with a number of international agreements related to it is
undisputed. From what has been described above and the author's own observations of the
trade and commerce rules in the WTO system, it seems that there are a number of reforms
practiced by the WTO to the corpus of international law in general, all of which seem to be
aimed at making international law more effective and able to provide benefits and justice for
all nations, both those living in developed countries and those in developing and less
developed countries. However, because the issues it governs are so complex, efforts to
realize the ideals as stated in the preamble of the WTO Establishment Agreement of "raising
standards of living, ensuring employment and the continuous increase of real incomes,
increasing production and trade in goods and services, making optimum use of the world's
resources in line with sustainable development objectives, protecting the environment," and
"improving the quality of life of all people in the world," have not been successful.
The Sixth Annual WTO Conference, which took place in London on May 23-24, 200628
, was one of the concerns of various parties for the success and sustainability of the world
trade organization. The conference was attended by many trade experts, students,
practitioners and diplomats to discuss various issues and challenges facing the WTO,
particularly its dispute settlement system. The underlying theme of the conference was the
role of the WTO legal system as part of the broader international legal system. The issues
discussed were not only how international law regulates parts of WTO dispute settlement but
also how the various sub-systems of international law interact. In addition to discussing the
position of the WTO in global efforts to realize development goals, the interaction and
harmony between policy-making at the national level and international legal processes is
discussed.
So it can be concluded, that public international law has an important role in shaping
norms and driving the activities of the WTO world trade organization and from time to time
parties who have high concerns are always trying to national laws of member states.
