INTERNATIONAL ECONOMIC LAW

INTRODUCTION

World Trade Organization

-​ Historical background
-​ ..
Video trump “we will leave if we have to” 2019

EXISTENTIAL CRISIS WORLD TRADE ORGANIZATION

Since its inception, the World Trade Organization (WTO), particularly its dispute settlement system,
has faced numerous controversies. Historically, these disputes did not pose significant threats to its
existence. However, in December 2019, challenges to the WTO escalated to an existential level. This
situation can be attributed to three key factors:

1. U.S. Skepticism Towards the Rules-Based International Trade Order

The Trump administration, more than other national administrations, was openly skeptical of the
rules-based global trading system. President Trump frequently criticized the WTO, alleging that it
treated the United States unfairly. This consistent skepticism undermined the credibility of the
organization and its ability to mediate trade disputes effectively.

2. Growing Strategic Competition Among Major Trade Powers

The escalating rivalry between China, the United States, and the European Union has intensified
tensions in global trade. One of the main sources of concern is China's "Made in China 2025"
industrial strategy—a state-backed initiative aimed at transforming China into a high-tech global
leader.​
The ambitious nature of this plan has raised alarms, particularly in the U.S., where it is seen as a threat
to American technological dominance. Key concerns include:

●​ State-backed industrial subsidies: Chinese firms are perceived to have gained an unfair
advantage through extensive government support.
●​ Intellectual property theft and forced technology transfer: The U.S. has long accused
China of engaging in practices that undermine fair competition.

In response, the U.S. and China negotiated the Phase 1 Trade Agreement, which aimed to enhance
intellectual property protections, address forced technology transfers, and improve U.S. access to
Chinese markets. Phase 2 is still on the negotiations table. However, the deal had several limitations:

●​ Key exclusions: The agreement did not cover industrial subsidies, which Washington
considers a core issue.
●​ Ambiguity in enforcement: The deal lacked clarity on how disputes would be interpreted
and enforced. Chinese state media suggested that the U.S. dictated the dispute resolution
mechanism, raising concerns about future compliance.
 ●​ Tariff uncertainty: There was no definitive timeline for removing tariffs imposed during the
trade war. Despite Phase 1 being signed, tensions remained high, and a Phase 2 agreement
was still under negotiation.

Even before the Trump era, previous U.S. administrations had voiced concerns about China's trade
practices and the design of the WTO dispute settlement system.

3. The Crisis in the WTO Dispute Settlement System

A critical issue exacerbating the WTO’s existential crisis is the U.S. blockade of new appointments to
the WTO Appellate Body, a key component of its dispute resolution mechanism. Although this
blockade intensified under the Trump administration in 2019, it had roots in earlier concerns raised
during the Obama administration. The lack of judge appointments has effectively paralyzed the
system.

Key U.S. Concerns with the Appellate Body:

●​ Judicial overreach: The U.S. argues that the Appellate Body engages in judicial activism by
over-interpreting WTO rules, creating new obligations for member states beyond what was
originally negotiated.
●​ Expiration of judges’ mandates: The U.S. has also opposed extending judges' mandates
beyond their expiration, further stalling the appointment process.

The result of this deadlock is a "freezing" of the dispute resolution mechanism, which is a cornerstone
of the WTO’s function. Without a functioning Appellate Body, the WTO’s ability to mediate and
enforce trade rules is severely compromised, pushing the organization into a deeper crisis.

HISTORICAL BACKGROUND

The idea of establishing an international trade organization was first proposed during the 1944 Bretton
Woods Conference, alongside plans to create two key institutions: the International Monetary Fund
(IMF) and the World Bank. While the IMF and World Bank were successfully established,
discussions on international trade coordination remained at the negotiation stage. The concept of a
global trade organization gained traction after the founding of the United Nations (UN), with trade
negotiations being conducted under the auspices of the UN Economic and Social Council. This led to
the groundwork for what would later become the General Agreement on Tariffs and Trade
(GATT).

Negotiations Leading to the Creation of GATT

As part of the efforts to develop a post-war international economic system, a series of negotiations
took place between New York City and Havana. Key milestones in these negotiations include:

1.​ Geneva Meetings (1947)​

The initial meetings in Geneva had three primary goals:
○​ Drafting the Charter for the International Trade Organization (ITO)
○​ Negotiating schedules for tariff reductions
○​ Creating a treaty outlining general principles of international trade
Although substantial progress was made, finalizing the ITO Charter proved challenging. By the end of
1947, the drafting of the charter was incomplete, and it wasn’t until 1948 that the final act was ready.
However, legal and procedural difficulties hindered its implementation.

The Failure of the ITO Charter

Despite efforts to complete the ITO Charter, it never entered into force. The reasons for this failure
were primarily political:

●​ U.S. Congressional Opposition:​

In 1948, the U.S. Congress came under Republican control. Many Republican members
opposed the establishment of the ITO, arguing that it could undermine U.S. sovereignty and
economic interests.
●​ Shift in U.S. Policy:​
President Truman’s administration initially supported the ITO but later withdrew its backing
due to domestic political pressure and skepticism about international organizations. Without
U.S. support, the ITO charter lost momentum and failed to gain the necessary international
backing.

Birth of GATT and Its Limitations

In the absence of the ITO, the General Agreement on Tariffs and Trade (GATT) was adopted as a
temporary solution to manage international trade relations. However, GATT had several inherent
"birth defects" due to its provisional nature:

●​ Contracting Parties vs. Membership:​

Unlike the ITO, GATT did not establish a formal membership system. Instead, countries
became "contracting parties," which limited its institutional capacity.
●​ Legal Inconsistencies:​
GATT obligations were sometimes inconsistent with national legislation, creating loopholes
and exceptions. One significant example is the "grandfather clause", which allowed certain
pre-existing national policies to remain exempt from GATT rules, undermining uniformity in
trade regulations.

WTO LEGAL TEXTS

The process of joining the General Agreement on Tariffs and Trade (GATT) was closely linked to
the negotiation of trade concessions. Candidate countries seeking membership were required to
negotiate tariff reductions and other trade commitments with existing members. Once these
negotiations were successfully concluded, the agreed-upon concessions were applied immediately
and without discrimination to all member parties, reflecting one of the foundational principles of the
GATT.

ART III. National Treatment of Internal taxation → paragraph 4

One of the core principles enshrined in the GATT legal framework is the principle of National
Treatment, as outlined in Article III. This principle ensures that imported goods are treated no less
favorably than domestically produced goods with respect to internal taxation and regulations.
Article III, Paragraph 4: Internal Taxation and Regulation

Paragraph 4 of Article III stipulates that:

"The products of the territory of any contracting party imported into the territory of any
other contracting party shall be accorded treatment no less favorable than that accorded
to like products of national origin in respect of all laws, regulations, and requirements
affecting their internal sale, offering for sale, purchase, transportation, distribution, or
use."

This provision aims to prevent protectionist measures that could disadvantage foreign goods, thereby
promoting fair competition and ensuring a level playing field in domestic markets.

The dispute arose when France implemented policies that Canada believed discriminated against
imported Canadian goods in favor of similar French products. Specifically, France applied different
regulatory or tax measures that seemed to disadvantage foreign imports relative to domestic goods.
Canada argued that the French measures violated Article III, which prohibits discriminatory internal
taxation and regulatory measures on imports.

The dispute between Canada and France centered on France’s policies, which Canada claimed
discriminated against Canadian imports by favoring similar domestic products. Canada argued that
this violated Article III of GATT, specifically the principle of National Treatment, which requires
member countries to treat imported goods no less favorably than domestic goods with respect to
internal taxation and regulation.

Canada escalated the matter to a GATT dispute panel after consultations failed.

Negotiation and Legal Proceedings

Canada initially attempted to resolve the dispute through consultations, as required by the GATT
dispute settlement process. However, when these negotiations failed, Canada escalated the issue to a
formal dispute settlement panel. The panel was tasked with determining whether the French measures
violated Article III by treating Canadian imports less favorably than French domestic goods.

The panel reviewed:

1.​ Whether the imported Canadian goods were “like products” compared to the domestic
French goods.
2.​ Whether the French regulatory or tax measures constituted less favorable treatment for
Canadian goods in practice.

The panel examined whether Canadian imports were “similar products” compared to French goods
and whether France’s measures constituted less favorable treatment. The case helped clarify the
interpretation of Article III and reinforced the importance of non-discrimination in international
trade, setting a precedent for future WTO cases.

Panel and Appellate Body Proceedings

1. Panel Proceedings
Panel proceedings are the first stage in resolving disputes between WTO member countries. The
process is governed by the Dispute Settlement Understanding (DSU), which provides detailed rules
on how disputes should be handled.

Key Steps in Panel Proceedings:

1.​ Request for Consultations:

○​ A member country believing that another member has violated WTO agreements
requests consultations.
○​ Consultations aim to resolve the issue amicably before moving to formal proceedings.
○​ If consultations fail, the complaining party can request the establishment of a panel.
2.​ Establishment of a Panel:
○​ A panel is established by the Dispute Settlement Body (DSB), usually composed of
three independent experts.
○​ The panel’s role is to examine the case and provide an objective assessment of the
facts and the application of relevant WTO agreements.
3.​ Submission of Written Arguments:
○​ Both the complainant and the respondent submit written arguments to the panel.
○​ Third parties with a substantial interest in the case may also participate and present
their views.
4.​ Panel Hearings:
○​ The panel conducts one or more hearings where parties can present their oral
arguments and respond to questions.
5.​ Interim Report:
○​ After considering the evidence and arguments, the panel issues an interim report to
the parties for comments.
○​ The interim report includes the panel’s findings and proposed recommendations.
6.​ Final Report:
○​ The panel issues a final report, which is circulated to all WTO members.
○​ If no party appeals the report within 60 days, it is adopted by the DSB and becomes
binding.

2. Appellate Body Proceedings

If a party is dissatisfied with the panel’s findings, it can appeal to the Appellate Body, which provides
a second level of review. The Appellate Body was established to ensure consistency and predictability
in the interpretation of WTO agreements.

Key Features of Appellate Body Proceedings:

1.​ Composition:
○​ The Appellate Body consists of seven members, though only three members hear
each case.
○​ Members are appointed by the DSB for a four-year term, with the possibility of
reappointment for a second term.
2.​ Scope of Appeal:
 ○​ Appeals are limited to issues of law and legal interpretation covered in the panel
report.
○​ The Appellate Body does not re-examine factual evidence but focuses on whether the
panel correctly interpreted and applied WTO rules.
3.​ Written Submissions and Hearings:
○​ Both the appellant and the appellee submit written arguments.
○​ Hearings are conducted where the parties can present their positions and answer
questions from the Appellate Body members.
4.​ Appellate Report:
○​ The Appellate Body issues a report, which may uphold, modify, or reverse the panel’s
findings.
○​ The report must be adopted by the DSB unless there is a consensus against its
adoption.
5.​ Adoption and Implementation:
○​ Once adopted, the findings and recommendations in the Appellate Body report
become binding.
○​ The respondent is required to comply with the recommendations within a reasonable
period.

Article XX General Exceptions

The Specific Exceptions under Article XX (Subparagraphs a–j)

These are the specific policy objectives that may justify a member state's trade-restrictive measures
under Article XX:

1.​ (a) Protection of Public Morals​

Measures designed to protect public morals, such as bans on the importation of goods deemed
harmful or immoral (e.g., pornography, gambling materials).
2.​ (b) Protection of Human, Animal, or Plant Life or Health​
Measures necessary to protect the life and health of humans, animals, or plants, such as
prohibiting the import of unsafe food, chemicals, or disease-spreading plants.
3.​ (c) Compliance with Laws or Regulations​
Measures that ensure compliance with national laws or regulations related to customs
enforcement, labor standards, environmental protection, etc. For example, restricting goods
made with child labor.
4.​ (d) Protection of Intellectual Property​
Measures to enforce intellectual property rights, including patents, trademarks, and
copyrights, which may involve restricting trade in counterfeit goods.
5.​ (e) Export Restrictions to Prevent Shortages​
Restrictions on exports to prevent critical shortages of goods in the domestic market. For
instance, limiting the export of foodstuffs during a national crisis.
6.​ (f) Conservation of Exhaustible Natural Resources​
Restrictions that aim to conserve natural resources, such as forests or fisheries, when
implemented alongside domestic regulations to ensure sustainable use.
7.​ (g) Protection of National Treasures​
Measures to protect national treasures, including works of art, historical artifacts, and other
cultural items of national significance.
 8.​ (h) Measures Relating to International Commodity Agreements​
Measures necessary for countries to comply with international agreements concerning the
trade of raw materials or other commodities.
9.​ (i) Restrictions for the Protection of Products in Short Supply​
Restrictions on trade that are necessary to protect products that are in short supply within the
domestic market, such as during a natural disaster or economic crisis.
10.​ (j) General Exceptions for Specific Circumstances​
This is a residual category for measures that do not neatly fit into the other exceptions but are
still deemed necessary for the well-being of society.

The Chapeau of Article XX: General Conditions

Even if a measure falls under one of the specific exceptions (subparagraphs a–j), it must also comply
with the chapeau (introductory clause) of Article XX. This provides a general condition that limits
the way exceptions can be applied to avoid misuse:

●​ The measure cannot be applied in a manner that constitutes arbitrary or unjustifiable

discrimination between countries where the same conditions prevail.
●​ The measure cannot be a disguised restriction on international trade. This means that a
country cannot use the general exceptions to impose protectionist trade barriers under the
guise of public policy objectives.

how many conditions are included in the program?

how many conditions are included when member stated decide to apply legislation or regulation
of more general principles of the agreement?

When a member state decides to apply legislation or regulation under Article XX of the GATT, there
are two main conditions that must be met:

1.​ The Policy Objective Condition: The measure must be necessary to achieve one of the
specific policy objectives listed in subparagraphs (a) to (j) of Article XX, such as
protecting public health, public morals, or conserving natural resources.
2.​ The Chapeau Condition: The measure must comply with the introductory clause
(chapeau) of Article XX, which requires that the measure:
○​ Does not constitute arbitrary or unjustifiable discrimination between countries
where the same conditions prevail.
○​ Does not constitute a disguised restriction on international trade.

Article XXI National security exceptions

become more popular lately.

Article XXI of the General Agreement on Tariffs and Trade (GATT) provides exceptions
allowing WTO members to take actions that might violate GATT obligations if those actions are
deemed necessary for national security. This includes measures related to defense, public order, or
protecting key resources during times of war or international crises.
Key Points:

1.​ National Security Measures:​

Article XXI allows for trade restrictions if they are necessary for the protection of national
security, including:
○​ Arms, ammunition, and implements of war (subparagraph a).
○​ Protection of essential security interests, including nuclear non-proliferation and
wartime measures (subparagraph b).
○​ Public order measures in times of war or emergency (subparagraph c).
2.​ Dispute Settlement Exclusion:​
The article explicitly excludes national security measures from WTO dispute settlement
procedures. Countries are free to take such actions without being challenged by other WTO
members.
3.​ Broad Scope:​
The article covers a wide range of issues, from military concerns to actions in times of
international crisis, allowing countries significant discretion in matters of national security.

Article XI: General Elimination of Quantitative Restrictions

Article XI of the General Agreement on Tariffs and Trade (GATT) prohibits WTO members from
using quantitative restrictions (like quotas or bans) on imports and exports. The goal is to promote
free trade by eliminating measures that limit the quantity of goods traded between countries.

Key Provisions:

1.​ General Prohibition (Article XI:1):

○​ Countries are not allowed to impose quantitative restrictions on imports or exports,
except in the form of tariffs, taxes, or other charges.
2.​ Exceptions (Article XI:2):
○​ Export restrictions: Allowed in cases of domestic shortages (e.g., food crises).
○​ Balance of payments: Countries facing economic difficulties can impose restrictions
to stabilize their financial situation.
○​ Conservation of exhaustible resources: Restrictions can be applied to preserve
natural resources, like fisheries.
3.​ Non-Discriminatory Application:
○​ Any restrictions under these exceptions must be applied in a non-discriminatory
manner.

The 8 rounds of the GATT (General Agreement on Tariffs and Trade), also known as "cycles de
négociations commerciales" or trade negotiation rounds, have played a key role in reducing trade
barriers and liberalizing international trade on a global scale. The main objective of these rounds has
been to reduce tariffs, but they have also addressed non-tariff barriers and other obstacles to trade.

Objectives of the Rounds:

-​ Reduce tariffs: A central goal has been to lower import tariffs, making goods and services
more affordable and accessible across borders.
 -​ Address non-tariff barriers: These include measures like quotas, licensing requirements,
and standards that restrict trade without directly affecting tariffs.
-​ Facilitate smoother trade: By eliminating trade restrictions, these rounds aimed to promote
freer and more predictable international trade.
-​ Tokio rounds: non tariff barriers
-​ Uruguay round: this last round carbonated the creation of huge .. of international trade. the
basic text. the
-​ Marrakesh agreement

The objective of those negotiating rounds was to reduce tariffs, later on non-tariffs. The last round
Uruguay petitioned for a creation of a new huge body of international law relating to trade. The basics
of the actual text exceeded 400 pages.
This final act transformed GATT into a new body/ organization: WTO.

Why did they come to the idea of WTO?

The idea emerged slowly form different needs, in terms of international regulations. Even at the very
beginning of the last round (Uruguay), negotiators and observers realized that significant new trade
agreements would require better institutional mechanism and a better system for trying to resolve
dispute btw member states. That how the dispute settlement system (DSS) was born. Thats why one of
the 15 negotiations plan was called FOGS (functioning of the GATT system).

Many countries at that time sought to avoid the issues that arose during the Tokyo Round, which led
to the creation of “new side agreements.” The issue was that these agreements were only binding on
the GATT contracting parties that accepted them, resulting in a “GATT à la carte” situation. The goal
was to establish new agreements, a better institutional structure, and an improved system for
interaction between member states. This was the reason why 1/15 committers were involved in the
development of the system that would eventually lead to the establishment of the WTO.

Many of the countries represented were keen to prevent the same issues faced in the Tokyo Round, as
it had resulted in side agreements binding only on those contracting parties that had accepted them.

The Tokyo Round's innovative aspect was its focus on both non-tariff and tariff barriers, with various
codes introduced to address these concerns.

This is why almost all countries

participating in the Uruguay Round were
more open to a proposal from one
particular professor, G.A. Jackson, who
served as a legal advisor. Jackson
suggested that the Uruguay Round should
be used as an opportunity to establish a
new WTO. He argued that it was time to
address the “birth defects” of GATT by
creating a specialized UN agency with a
specific structure and a robust dispute
settlement mechanism.
The WTO never became a specialized agency

Jackson believed that such an organization would resolve the “GATT à la carte” issue, requiring all
member states to accept all agreements in order to become full members. This approach would
essentially make membership a package deal: countries would need to sign the entire agreement to
officially join.

The idea was not taken at the very beginning with the Uruguay round (in 1986), but later on in 1991
bc of the cold war. → Final act → name was changed to World Trade Organization.
Indeed, real progress were made at the end of 1989, it was the result of 2 factor:
a)​ the end of the cold war and the end of state control economies
b)​ the agriculture issue which was the main issue. But finally, (starting 1991) during November
1992, the US and the EU settled most of their differences on this subject, in an agreement the
Blair house agreement. By July 1993, the QUAD (US,EU, Japan and Canada) announced
progress in negotiations on tariffs in general and related subjects like the market. It took until
mid-December 1993, for every issue to be resolved and for negotiation for market access for
goods and services (one of the main ideas was to extend the existing get malls concerning
only goods) to be concluded.

The package of agreements that brought the WTO into being, was opened for signature at Marrakech
on the 15th 1994. This package signed by ministers, from most of the 125 participants, consisted on
multilateral agreements, which are next to a single document namely the establishment of the WTO
(Marrakech agreement).

The Marrakech Agreement, signed on April 15, 1994, marked the formal creation of the World Trade Organization
(WTO). This agreement was the result of the Uruguay Round negotiations (1986–1994), which aimed to modernize and
expand the rules governing international trade. The signing ceremony took place in Marrakech, Morocco, with ministers
from most of the 125 participating countries endorsing the agreement. This event symbolized a major milestone in global
trade governance.

The package of agreements signed in Marrakech consisted of a set of multilateral trade agreements, all consolidated into a
single document called the Marrakech Agreement. This document established the WTO as the legal and institutional
framework for managing global trade. The agreements included rules not only for the trade of goods but also for services,
intellectual property, and dispute resolution. The WTO thus replaced the provisional GATT system that had governed trade
since 1948.

Among the key components of the package were the GATT 1994, which updated the rules for trade in goods, and the
General Agreement on Trade in Services (GATS), which introduced governance for international trade in services. The
Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement was also introduced to address intellectual
property in trade. Furthermore, the Dispute Settlement Understanding (DSU) created a formal mechanism for resolving
trade disputes between member states. The agreements on agriculture, textiles, and the Trade Policy Review Mechanism
(TPRM) ensured greater transparency and brought previously excluded sectors under WTO rules.

The Marrakech Agreement had far-reaching implications for the global economy. By creating the WTO, it established a
more structured and inclusive framework for trade, ensuring compliance with agreed-upon rules and providing a venue for
dispute resolution. This marked a transition from the temporary GATT framework to a permanent institution capable of
addressing the complexities of modern global trade.

In conclusion, the signing of the Marrakech Agreement in 1994 represented the dawn of a new era in international trade.
By consolidating various agreements into a unified structure, the WTO became the cornerstone of global trade governance,
fostering transparency, inclusivity, and predictability in international commerce
All agreements became binding as a single body of law. The task had been immense and the difficulty
of reaching agreements of this kind of this package containing almost the entire range of current trade
issues. Negotiating on this scale could never again be possible. Almost
The 1st annex of the WTO is divided in 3 parts:
Annex 1 :
-​ Annex 1A: GATT 1994 => the WTO agreement replaced the GATT 1947 with the GATT
1994. In fact, it is a new and legally distinct agreement. In fact, the GATT 1994 consists of the
main provision of the former GATT, excluding the protocol of provision application.
-​ Annex 1B which consists of the GATT agreement on trade and services. The GATT 47 did
not deal with services. It was a way to extend the already existing rules to services.
-​ Annex 1C : agreement on trade related aspects of intellectual property rights (accord sur les
aspect de droit de propriété intellectuelle touchant au commerce)

Annex 2 : the understanding of rules and procedure governing settlement of dispute. This settlement
establishes the procedure for reserving trade disputes between WTO members.

Annex 3: the trade policy review mechanism (mécanisme d'examen de politiques commercial) =>
every 2nd year for the economic powers and every 4 years for the moderate economic powers, every 6
years of the poorer countries. This was to assure that contracting parties were abiding by their
obligations. Also, to ensure transparency.

(Annex 4: Plurilateral trade agreement)

The WTO exists to facilitate the implementation, administration, operation and other main objectives
of all WTO agreements. The WTO is an umbrella under which there are all of those mentioned
agreements. But beyond this purpose, the WTO has also 4 specific tasks:
- ​ Provide a kind of international area for negotiation among members both as to
current matters and any future agreements that could be signed. The WTO serves as
an international forum where member states can negotiate on current trade matters as well
as discuss and develop potential future agreements. This role fosters cooperation and
consensus-building among nations.
- ​ To administer the system of dispute settlement mechanism. The WTO oversees the
dispute settlement system, ensuring that trade disputes between member states are
resolved in a structured, rule-based, and impartial manner.
- ​ To administer the trade policy review mechanism. The organization conducts periodic
reviews of member states' trade policies to promote transparency and ensure alignment
with WTO rules.
- ​ To cooperate as needed with the IMF and the World Bank. The WTO collaborates
with institutions like the International Monetary Fund (IMF) and the World Bank (Bretton
Woods institutions) to ensure coherence in global economic policymaking and address
broader economic challenges.

The WTO should, as Professor Jackson said, a specialized agency of the US (institution spécialisée
[3]
des Nations Unies). The organizations of the UN have international legal capacity , as well as
privileges and immunity. The link between the specialized agencies and the UN is made by treaty via
Economic and social council. Of course, each specialized agency has common objectives with the
UN. The WTO is of course, dotted with legal personality and capacity. It also has privileges and
immunities that are in accordance with its specific functions. The WTO never became a specialized
UN agency.
Finally, the WTO has 2 governing bodies:
● ​ The ministerial conference: the supreme authority, most important authority. All
members are represented within the 1st and the 2nd on. This conference meets at leat
once every 2 years.

The Ministerial Conference is the supreme authority of the WTO and holds the highest decision-making
power within the organization. It is composed of representatives from all WTO member countries, ensuring
that every member has a voice in the most important decisions. The conference convenes at least once every
two years, serving as the forum where major trade policies and negotiations are discussed and decided. The
Ministerial Conference is tasked with approving new agreements, resolving complex trade issues, and setting
the overall direction for the WTO’s future work. Its decisions are pivotal for shaping international trade rules
and fostering cooperation among nations.
● ​ The general council: chief decision making and policy body btw meetings of the
conference. But the general council also discharges the responsibilities of 2 important
subsidiary bodies :
→ the dispute settlement body
→ the trade policy review body.

The General Council is the chief decision-making and policy body that operates between the meetings of the
Ministerial Conference. While it functions as a key governing entity, it also takes on additional responsibilities
through its two critical subsidiary roles. First, as the Dispute Settlement Body (DSB), the General Council
oversees the resolution of trade disputes between members. This ensures that disputes are handled in a fair,
transparent, and rule-based manner, maintaining the integrity of the global trading system. Second, as the Trade
Policy Review Body (TPRB), it monitors and reviews the trade policies of member countries. By fostering
transparency, the TPRB helps ensure that members comply with WTO rules and that their policies align with the
principles of fair and open trade.

So the general council has 3 main responsibilities. Those 3 bodies are one specific entity serving 3
different functions. Other committees, councils that have to report, do much of the day-to-day work of
the WTO.
The WTO also established 3 other councils:
- ​ Council for trade and goods: for trade in goods
- ​ Council for trade and services
- ​ Council for trade related aspects of the intellectual property rights
These councils also have the power to establish committees that are called subsidiary bodies. (voir
organization chart sur le site)

States are referred to as primary subjects of international law because they are the original and
fundamental entities with rights and obligations under this legal system. International organizations,
on the other hand, cannot be considered primary subjects because they are created by states. Instead,
they are referred to as “sujets dérivés” (derived subjects), as their existence, powers, and legal
personality stem from the agreements and decisions of states.

International organizations are granted the authority to establish subsidiary committees, which assist
in carrying out their functions. However, there is a distinction between general bodies and subsidiary
bodies:
 ●​ General bodies are explicitly mentioned in the founding agreement or charter of the
organization. They are integral to its primary structure and operations.
●​ Subsidiary bodies, on the other hand, are not explicitly mentioned in the founding
agreement. Instead, they are established later by the organization as needed to fulfill specific
tasks or objectives.

This differentiation highlights the flexibility of international organizations to adapt and respond to
new challenges while maintaining a structure rooted in the authority granted by states.

The general decision-making processes

The decision-making processes in the World Trade Organization (WTO) are considered somewhat
unique because they incorporate several procedures and customary practices inherited from the former
GATT 1947. They are quite unusual, because several procedures and former customary practices of
the GATT were retained.
There are 2 primary modes of decision making. Each mode is designed to balance inclusivity and
efficiency in global trade governance:

1.​ The WTO primarily relies on decision by consensus for its general decision-making
processes. This practice, retained from GATT 1947, operates on a principle referred to as
negative consensus. Under negative consensus, a decision is adopted unless every single
member opposes it. This mechanism makes decision-making more efficient and ensures that
decisions are not stalled unnecessarily.
-​ one difference: positive consensus while the WTO for several reasons is applying positive and
negative consensus

The reason the WTO opted for negative consensus lies in the inefficiency of positive consensus,
which requires unanimous agreement (everyone must explicitly say “yes”) to adopt a decision.
Positive consensus can often delay decisions significantly because even one member’s dissent can halt
the process, requiring a vote to proceed. By contrast, negative consensus effectively automates the
adoption of decisions unless there is unanimous opposition, making the process quicker and more
practical.

The advantage of the negative consensus:

❖​ Efficient Decision-Making: Decisions are automatically adopted unless unanimously

opposed, avoiding delays caused by the need for full agreement.
❖​ Prevents Deadlocks: Eliminates the ability of a single member to block decisions, ensuring
smoother progress.
❖​ Strengthens Dispute Settlement: Ensures rulings are adopted automatically, enhancing the
effectiveness of the dispute resolution system.
❖​ Encourages Broad Cooperation: Promotes negotiation and collaboration to avoid
opposition, fostering inclusivity.
❖​ Supports Fairness: Levels the playing field by reducing dominance from powerful members
and giving all nations a voice.

2.​ If a decision cannot be reached by consensus, the WTO allows for decision by voting. In
such cases, members cast votes to adopt a decision, ensuring that progress can be made even
 when unanimous agreement cannot be achieved. While voting is available as a fallback
mechanism, the WTO strives to reach consensus wherever possible to maintain unity and
avoid divisive outcomes.

Application in the Dispute Settlement System

The negative consensus principle is also applied in the WTO’s dispute settlement system. This
ensures that reports and rulings from dispute settlement panels or the Appellate Body are adopted
unless all members unanimously oppose them. This process is crucial for maintaining the
effectiveness and credibility of the dispute resolution mechanism, as it prevents any single member
from blocking the adoption of rulings.

Interpretations of agreement.
The WTO has a strict rule concerning interpretation of WTO agreements. Bc WTO members
realized, at the beginning of the existence of the organization, the complexity of the huge mess of
text/verbiage. They didn’t want official things to be adopted by subsidiaries, that’s why WTO
agreements provide that only the conference and only the general council and ministeries have the
power to adopt interpretations of the WTO agree and those interpretations only by ¾ majority of
members.
In other words, the interpretation authority should not be used to undermine WTO obligations and
commitments under the agreement.
The important delay concerning the adoption and signing of the final act in Marrakech, had some
merits. It allowed some negotiations to progress further that would have been possible in 1990.
Consider some aspects of services and intellectual property and the creation of the organization itself.
The task has been immense, because participating countries agreed on a complete package containing
almost the entire range of current trade issues at the time. This state of fact led some people to
conclude that a negotiation on this scale would never again be possible.
In other words, it took 7 and a half years, almost twice as long as the original schedule. By the end,
125 countries signed and covered almost all trade (from banking to telecommunication, etc). It was
quite simply the largest negotiation of any kind in history, even if at times it seemed doomed to fail.