11-WTR Currents: Int'l Trade L.J. 16
This
paper argues that that the Dispute Settlement Understanding (DSU) of
the World Trade Organization (WTO) seeks to transform international
trade law from a political to a juristic model. This position is known
as the professionalization thesis. The legal procedures established by
the DSU succeed in making this transformation. As such they are a
working example of effective functionalist theory.
International
trade today is moving from a political multi polar system based on the
nation-state to a loosely unified global legal system featuring even
essentially unified continental trading regimes such as NAFTA, the EU,
MERCOSUR, and ASEAN. This transformation has had the effect of
reorienting entire institutions. [FN1]
The globalization of law was made possible technologically by the rise
of a telecommunication and transportation infrastructure unprecedented
in human history. Ideologically globalization expresses itself as the
rise of a consumption economy, which if it does not succeed in
silencing opposition often anaesthetizes it.
If
both technology and politics make it possible to create a truly global
legal system recent events demonstrate that the world remains a
dangerous place. However despite the challenges of fundamentalism and
sectarianism-in fact because of them-it is obvious that building global
institutions of peaceful governance is the only way to prevent the
backlash of the poor and desperate in a world divided into two great
camps-one rich and the other poor.
Making
the transition from politics-the Hobbesian war of all against all-to
society has been a vision of utopians at least since Marx. Ironically
one of the institutions that will help make that transition is
capitalist to the core. The DSU of the WTO provides a juridical
framework which replaces the former interminable and uncertain
political process of GATT. [FN2]
The professionalization thesis states that the planet is developing juridical
institutions to replace political ones. Instead of
the extreme political vacillations which characterize political
institutions, advocates of the juridical professionalization thesis
propose the replacement of political processes by judicial mechanisms
which they say will lead to more rational predictable and stable
decisions reducing transaction costs and increasing productivity. [FN3]
In the domain of the WTO, the professionalization thesis argues that
that transition has already occurred via the DSU, this establishes a
panel and appellate process plus remedies for violations of the
substantive principles of the WTO. It is clear that the DSU is already
a working example of Weber's theory of ideal rational bureaucratic
neutrality. [FN4]
This
paper adopts a qualified professionalization thesis: the replacement of
unstable political processes with rational judicial processes is
possible. In the field of trade it is even desirable. But that
transformation must at least avoid earning the enmity of the people.
Given the waves of militant but essentially non-violent [FN5] anti-WTO protest it is clear that the WTO is not inevitably legitimate. [FN6]
Consequently the WTO will have to earn the trust and respect of the
third world. If the WTO can continue to adjudicate in an apolitical
fashion over time it will obtain legitimacy as an institution
determined to make peace through prosperity. The WTO could become one
more success story of functionalism.
*17 To determine to what extent the DSU embodies the professionalization
thesis and how it might better obtain the above
objectives we shall study proceedings at the E.U. under the Trade
Barriers Regulation (TBR) and the dispute settlement understanding of
the Dispute Settlement Board (DSB) of the WTO. Our exposé of the
procedures is intended to demonstrate the theoretical conformity of the
WTO to the professionalization and functionalist theses. These theses
then shall be verified by a consideration of empirical practice in the
case law of the Panel and Appellate Body; which shall show that this
theoretical professionalism is also followed in practice. [FN7] We shall conclude with a brief examination of proposals for reform of the DSB.
The
professionalization thesis holds quite simply that the international
trading system is moving from a model of governance determined by
political process and dominated (albeit less so in the post-war world)
by conflict toward a model based on consensus and governed by judicial
decision. This thesis will be explored with respect to E.U. and WTO
institutions which govern the adjudication of international trade
disputes. There we will see that, with qualification, [FN8]
the WTO's Dispute Settlement Mechanism (DSM) institutes an arbitration
panel which operates as a quasi-judicial body that issues judgments [FN9] that carry precedential value.
A. E.U. REMEDIES: PROCEEDING UNDER THE TRADE BARRIERS REGULATION
Prior
to seeking a remedy for trade restrictions before the DSB, an aggrieved
party can seek relief before European courts under the E.U.'s TBR. [FN10] From the perspective of the WTO however exhaustion of local remedies is not a pre-requisite to proceedings before the panel. [FN11]
The E.U. procedures are relatively straightforward, though not without contention. [FN12]
Much like any other court, the complainant must first state their
allegations. The complaint must identify the plaintiff and defendant,
and state the practice(s) which constitute a barrier to trade. [FN13]
The complaint must be properly served, and should state, as clearly and
specifically as possible the nature of the practice complained of that
constitutes a barrier.
If
the claim is procedurally well founded the community will then consider
the substance of the complaint. Proceedings under the TBR are
inquisitorial rather than adversarial and thus more similar to the
continental civil law than to the Anglo-American common law. The
complained practice must constitute either an injury or threat of
injury to the communities' industry or to the communities' trade (Art.
2(3) injury; Art. 2(4) adverse affects of the TBR). This "effects"
based reasoning can of course be criticized as veiled protectionism.
Such a complaint could later be made before the WTOs panel under the
Dispute Settlement Mechanism-although the WTO also allows effects based
reasoning. Nevertheless one limitation of the E.U. remedy is that it is conditioned by the WTO.
Having
set out the claim of an actual or potential injury to community trade
via an adverse trade practice, the plaintiff must then prove
causation-meaning that the behavior in question causes or threatens to
cause an injury. Adverse practices are not necessarily trade barriers.
Whether a particular practice causes an injury to trade is determined
according to EC Council Regulation 3286/94 22 Dec. 1994. [FN14] That regulation considers both de jure and de facto prohibitions. [FN15] Causation may be proven by adducing by statistical evidence as to the volume of trade and prices under art.10 of the TBR.
One
can criticize the TBR first, and perhaps unfairly, as veiled
protectionism. That critique however ignores the necessity of an E.U.
"clearinghouse" for the competing national claim and the fact that
adjudication at the TBR may reduce the workload of the WTO. A more
salient critique would be to attack the effects of biased reasoning of
the TBR: [FN16] the
behavior that can be complained of under the TBR does not need to
actually cause damage. The mere threat of a potential injury to
community trade is sufficient to prove causation. Further, the injury
complained of does not need to directly affect Europe but can affect
third party states. Thus if a trade agreement between two states
outside of the E.U. merely threatens to negatively effect E.U. trade it
could be the basis for a complaint under the TBR. For example, a
contractual agreement between a state and a company to perform an
installment contract could constitute a threat to European trade with
that non-member state-and thus be the basis for a TBR proceeding. This
exorbitant jurisdiction explains why one could question the neutrality
of the TBR. In so far as the TBR acts as a vector for European trade
interests, its role as a neutral clearinghouse for the WTO is
jeopardized. To that extent the TBR or any similar regional agreement
is a weak point of the professionalization thesis: regional dispute
settlement could act as a clearing-house for the WTO or could undermine
it. However, even if the TBR were a political rather than judicial
institution that would not necessarily imply that the DSU were also
political rather than quasi-judicial. The neutrality of the TBR can be
questioned and because litigation is *18 conflict driven remedies before the E.U. may eventually be questioned before the WTO where we now turn our attention.
B. THE "TRIAL" LEVEL: THE DSB PANEL PROCESS [FN17]
What
procedure must be followed to make a complaint before the WTO?
Proceedings begin with good faith consultations (DSU art. 4) [FN18]
which seek an amicable settlement. Third parties may at this time seek
to intervene if their interests are implicated (art. 4 § 11). If the
complaining party is dissatisfied with the outcome of the
consultations, they may request the DSB to form a panel to decide the case. The request to
form an arbitration panel must be made in writing, summarize the
complaint, and indicate the parties (art. 6, § 2). The DSB may refuse,
but only by consensus (art. 6, § 2). The panel itself is composed of
three "well qualified" arbitrators, whose selection may only be opposed
for compelling reasons. (art. 8) The panel may in the alternative, if
both parties agree, be composed of 5 persons (art. 8). The panelists
act in a personal capacity and are not representative of any government
or non-governmental organ. (art. 8). Naturally the panel must make its
decisions fairly and equitably (art. 11). The parties' arguments are
presented first in writing (art. 12, § 6). These provisions show that
in theory the DSB arbitration is very similar to an ordinary judicial
instance and should operate as an international court. That tends to
prove the professionalization thesis, that functionalist approaches to
solving problems of world trade through depoliticization are the best
way to build peace through prosperity. Other provisions also support
this view.
The
panel, like the TRB, can be said to be "inquisitorial" in the sense
that it can seek information from the parties and pose questions to
them. (art. 13). That is of course not a standard judicial procedure in
the Anglo-American common law but is the normal course of events in
continental civil law jurisdictions and elsewhere in international law.
The panel's deliberations are confidential. (art. 14). The procedure
does foresee oral arguments as well as written submissions (art. 15, § 2) Prior to final
delivery of the decision of the panel to the DSB, the parties are given
"one last chance" to raise objections to the interim findings directly
before the panel. (art. 16, § 2). After this "last chance", any
objection either as to the substantive findings or procedural
enforcement of those findings must then take place via appeal to the
appellate body.
C. THE APPELLATE BODY
After
the judgment of the panel, parties may appeal the decisions of the
panel to the appellate body (art. 16, § 4 and art. 17). The provisions
at the DSB "trial" level parallel those of a national court. This
judicial parallel continues at the appellate level. In theory the
appellate body should also operate like a national appellate court,
that is, as a neutral and objective arbitrator. [FN19]
The
appellate process is relatively straightforward. There is however
procedural limits on the openness which can with justice be criticized
and which are not necessary to depoliticization of trade disputes. The
reports of the appellate body are anonymous (art. 17, § 11). Its
deliberations are confidential. (art. 17, § 10). Most problematic for
legitimacy, third parties to the dispute may not directly appeal the
decision of the panel (art. 17 § 4). Although they can intervene once
an appeal is initiated by either party to the dispute. Further once an appeal has been initiated new third parties may join the appeal. [FN20] Thus while there are no explicit provisions for briefs filed as amicus curiae, [FN21]
which is a point of criticism, a similar result can be reached by
joining the appeal. Third parties are however correct in remarking that
joinder is more burdensome than merely filing as amicus curiae. Thus
some persons, notably NGOs, propose permitting amicus filings which
would be one way to increase democratic legitimacy of the WTO.
The
proceedings of the appellate body, like the panel, are intended to be
neutral and objective. The members of the appellate body must be
experts in the field of law and commerce [FN22] but may not be affiliated with any government. [FN23]
All of these procedural requirements of fairness, neutrality,
independence, and professional competence, as well as the stringent
time limits on enforcement of judgments are further evidence of the
professionalization thesis.
D. IMPLEMENTATION: REMEDIES FOR BREACH OF WTO TREATY OBLIGATIONS
Once
the panel or the appellate body has reached a final decision, if the
practice is determined to be illegal the order will reflect a ruling to
cease such activity. The party in breach of their treaty obligation
must remedy this breach within a reasonable time (art. 21, § 3). [FN24]
What constitutes a "reasonable" time? In fact a consensus is emerging which
parallels the understanding's provisions that reasonability is proportional to the difficulty of implementation. [FN25]
A "reasonable" time to implement the remedy may be determined by the
agreement of the parties, through arbitration. A practical guideline
for the longest "reasonable" time period is 15 months, though provision
here is made for *19
accounting for time of appeal that still may not exceed 18 months (Art
21, § 4). Flexibility in the time required for the remedy is also
permitted in cases where the state in breach is a developing country.
(art. 21, § 8). However notwithstanding these derogations every case
should, in principle, be decided at the very most two years after
initiation, and on average six months to a year after initiation of
proceedings.
The panel and appellate body seek a rapid and fair resolution of every claim. [FN26]
If the WTO can enforce this time schedule-and as we shall see it
does-then the rapidity and certainty of these decisions is further
evidence of the validity of the professionalization thesis: rather than
endless negotiation instability and political theater the deliberations
are judicial timely and rational.
E. SANCTIONS FOR VIOLATION OF CONTINUED NON-COMPLIANCE: REASONABLE AND PROPORTIONAL RETALIATION
The non-breaching party may demand monetary compensation in cases of continued
non-compliance (art. 22, § 2) or retaliatory trade
sanctions will be permitted (art. 22, § 3). Though 23, § 3 does not use
the terms "proportionality" or "reasonability" the escalating series of
potential retaliatory measures that it enumerates can best be
understood with those two qualifications. This interpretation will be
supported infra in the case law. Thus the retaliation should be in the
same sector of the agreement. If that is not possible the retaliation
should be within other sectors of the same agreement. If that is also
not possible or impractical, permissible retaliation in other
agreements between the parties is permitted as a remedy. However while
retaliation is permissible punitive damages are not a part of the
escalating sanctions. [FN27]
Compensation rather than punishment is the rationale of the WTO. An
argument that retaliation must be reasonable and proportional can also
be supported elsewhere in the treaty. art. 22, § 3(d)(ii) permits
economic analysis to determine the correct remedy. Overburdensome and
disproportional remedies would thus be prohibited where more reasonable
remedies are available.
The
requirement that the remedy be reasonable and proportional can also be
supported by general principles of law and specific examples of other
areas of remedies under international law. As general principles and
canons of construction the concepts of reasonability and
proportionality permeate the law. The principles of proportionality and
reasonability can be found in the field of remedies for breach of
rights under international. For example, national self-defense must be reasonable and
proportional. The right of retaliation and reprisal under international
law is also required to be reasonable and proportional. For these
reasons the better view is that retaliation for continued
non-compliance with WTO orders, like other international law defenses
such as reprisals or self-defense, must be proportional and reasonable.
That view is also the fairest if we see the purpose of the WTO as
building peace through prosperity: punitive or vindictive remedies
would frustrate that purpose both by generating ill will and because
they are less economically efficient than more measured responses.
Because retaliation poses the risk of vindication, arbitration exists
as a possible method to resolve the dispute over compensation or
retaliation. (art. 22 § 7; art. 25).
The
fact that the panel and appellate body are established according to,
and enforce, objective procedures for the regular determination of
diverse trade disputes is further evidence of the validity, at least in
theory, of the professionalization thesis. We now turn to the practice
of the courts in order to determine the validity of the
professionalization thesis in practice. There we will see that while
the cases are still few in number they demonstrate a rapidity and
certainty of decision that supports the professionalization thesis.
The
exposé of the procedural mechanisms of the DSB and DSU shows the
theoretical validity of the professionalization thesis. We now verify
the theoretical hypothesis of professionalization through a material
comparison of the actual empirical facts of disputes brought before the
panel with the theory. This will show that the validity of the
professionalization thesis is confirmed in practice.
This
verification shall draw on two empirical sources. First it shall
examine the substantive issues of recent or pending litigation before
the WTO. Then it shall perform a statistical analysis of the WTO
caseload. The facts revealed by both these verifications will tend to
prove the professionalization thesis.
A. CASES
The
cases which we shall study are either not yet resolved, resolved
through settlement or resolved through the decision of the panel or
appellate body. They show that the WTO encourages amicable settlement
where possible but arbitrates settlements when necessary. All of the
cases involve intellectual property law and all cases but one involves
the U.S. and the E.U. or an E.U. member state.
These
cases tend to prove that the dispute settlement mechanism is an example
of coherent bureaucratic operational efficiency of the type described by Max Weber. The settlement procedure encourages dispute resolution through hierarchical *20
procedures of trial and enforcement of judgment. Settlement is also
encouraged by the fact that the mechanisms of enforcement are
efficacious. Enforcement efficacy is guaranteed by the ultimate
sanction of economic retaliation (countervailing duties, import
restrictions and other barriers to trade) by the injured party. [FN28] That sanction however must be proportional and reasonable.
The
WTO remedy succeeds because it turns the self-interest of the state
toward enforcement. Thus the DSB is also a working example of effective
realist-functionalist state theory. However in so far as these
mechanisms remain undemocratic (apart from the virtual representation
of appointed governmental ministers) the WTOs DSM has not yet squared
the circle by forming a synthesis of the competing thesis of realist
and transformationist state theories. That may not be possible. However
it may not be necessary. Functionalism provides a means of resolving at
least the mundane problems of daily life. Perhaps those are the only
problems that can ever be solved. They are in any event the most
immediate. If the DSM "only" succeeds in normalizing world trade then
it will serve the purpose of encouraging commerce and economic growth
thereby reducing the risk of war, at least within the first world. In
sum, the panel procedure encourages amicable settlement at several
levels, is in all cases relatively rapid (particularly when compared to
the political system which preceded it) and creates enforceable judgments through a
series of ever-stronger remedies for non-compliance. This practice
validates the theory that supports the professionalization thesis.
The
following cases have been selected for their subject matter,
intellectual property, and their parties; which in all cases save one
are the U.S. challenging either the E.U. or an E.U. member state.
The following cases are currently pending before the arbitration panel:
United
States - Section 337 of the Tariff Act of 1930 and amendments thereto,
complaint by the European Communities and their member States (WT/
DS186/1). [FN29] Section 337 of the U.S. Tariff Act (19 U.S.C. § 1337)
and the related Rules of Practice and Procedure of the International
Trade Commission contained in Chapter II of Title 19 of the U.S. Code
of Federal Regulations permits the U.S. to take unilateral action for
violation of intellectual property rights. 19 U.S.C. § 1337
is challenged as contravening Article III of GATT 1994 and TRIPS
Agreement Articles 2 (in conjunction with Article 2 Paris Convention),
3, 9 (in conjunction with Article 5 Berne Convention), 27, 41, 42, 49,
50 and 51. Since the law in question was enacted prior to the last
world war it may well be stricken as inconsistent with TRIPS. While
unilateral self help was the ordinary remedy in 1930, such is no longer
the case.
United States - U.S. Patents Code (WT/DS224/1), [FN30]
request by Brazil. This request concerns the provisions of the United
States Patents Code (US Patents Code), in particular those of Chapter
18 [38], "Patent Rights in Inventions Made with Federal Assistance".
Essentially the U.S. law at issue in DS224 requires that any patent
procured as a result of U.S. federal research aid is manufactured
thereafter in the United States. This is another paradoxical example of
TRIPS being invoked to limit the extent of intellectual property
rights! Brazil has requested consultations with the U.S. to understand
the U.S. position justifying the consistency of its limitation on
federal research subventions with the TRIPS and TRIMS agreement (TRIPS,
Articles 27 and 28; TRIMS Agreement, Article 2 in particular, and
Articles III and XI of GATT 1994). [FN31]
The
perception is that U.S. funded researchers will go to Latin America in
search of local species to patent. Thus this case represents not only
an example of anti-competitive government subsidization and monopoly,
it also represents an attempt by the first world to develop and seize
the resources of the third world. Because this case exemplifies
protectionism it is fairly clearly a violation of the free trade
principles that justify TRIPS and the WTO. For these reasons it is
possible that this case will be settled amicably.
This
case is also interesting in that it will illustrate the limits of the
DSB: while we have already seen the DSB can in effect order legislative
amendment, it is not likely that the DSB will go so far as
to order one state to essentially subsidize another state's research
and development costs. While it is perfectly consistent with a
free-trade rationale to order a state to cease subsidization of its
industries, even indirectly, it is inconsistent with that theory to
require a state to essentially subsidize foreign and domestic
industries equally. The former is a passive integration wholly
appropriate to the WTO. The latter however is an active form of
positive integration, more appropriate for political arrangements and
regional customs unions such as the EU. Thus DS224 is not posed in its
proper terms: the question should not be whether the U.S. should
subsidize the Brazilian industry, but whether it can subsidize its
industries at all. Because of these two questions this case could serve
to delimit the different nature and scope of regional as opposed to
global trading regimes.
*21
These two cases that are at the consultation phase and have not yet
been settled are examples of the first step in the process, seeking a
hearing before the panel. They show that the process of negotiation
toward amicable settlement continues even in the midst of preparation
for litigation and thus tend to show that the mechanism of settlement
and judicial decision is working. During negotiations, either the case
settles, or goes forward. If the case goes forward a decision is
issued. Either the decision is appealed or enforced or avoided. If the
decision is appealed either the decision may be changed. However, the decision has avoided a series of
escalating retaliatory measures are allowed proportional to the injury
resulting from breach of the treaty obligations. This is very similar
to the process before any other court, and this similarity is further
evidence of the validity of the professionalization thesis.
Sweden - Measures Affecting the Enforcement of Intellectual Property Rights, complaint by the U.S. (WT/DS86/1). [FN32]
Here, in essence, the U.S. argued that the Swedish remedy for
infringement of intellectual property rights was inadequate and thus
violated Articles 50, 63 and 65 of the TRIPS Agreement. The parties
reached a mutually agreeable settlement. This case is thus another
example of the efficacy of the agreement in terms of encouraging
settlements.
Portugal - Patent Protection under the Industrial Property Act, complaint by the U.S. (WT/DS37). [FN33]
In that case the U.S. argued that Portuguese domestic law on
(Portugal's Industrial Property Act) was in violations of Articles 33,
65 and 70 of TRIPS. Both parties notified a mutually agreed solution to
the DSB. Again the procedures are effective as they encourage
enforceable settlement of disputes.
European
Communities - Enforcement of Intellectual Property Rights for Motion
Pictures and Television Programs, complaint by the U.S. (WT/DS124/1). [FN34]
Essentially this was a case asserting copyright
infringement. The U.S. alleged that Greek television stations regularly
broadcast copyrighted movies and television programmes without securing
permission from their owners. The U.S. argued that the Greek remedies
are either unenforced or inadequate and asserts a violation of Articles
41 and 61 of the TRIPS Agreement. A mutually satisfactory negotiated
solution was reached. [FN35]
The
disposition of these three cases by settlement tends to prove the
professionalization thesis. Rather than seeing long drawn out
procedures, the trade disputes are adjudicated fairly and rapidly and
thus more often than not are settled.
United States - Section 110(5) of the U.S. Copyright Act (DS160) [FN36]
This case is interesting because it is the first litigation of one of
the U.S. "Fair Use" exceptions to copyright protection. It is also the
only case considered which neither settled nor is pending. The case
demonstrates that even in contentious issues the WTO is able to enforce
its judgments-even against the U.S. Thus this case is very strong proof
of the validity of the professionalization thesis.
Essentially,
U.S. copyright law permits display in public places of current (as
opposed to recorded) broadcasts without paying royalties provided only
that the receiver be of the type ordinarily used in the
home and that no charge be imposed for such display. This permits, for
example, bus stations, cafes, bars etc. to play a radio and television.
This exception to the author's monopoly right was permitted as being in
the public interest and on the merits can be defended (not only because
free diffusion of news and entertainment is in the public interest but
also because enforcement of the right of the copyright holder would be
impossible in practice).
The
U.S. law (Section 110(5) of the U.S. Copyright Act, as amended by the
Fairness in Music Licensing Act, 27 October 1998) was challenged as
being in violation of Article 9(1) of the TRIPS Agreement, which
incorporates by reference Articles 1-21 of the Berne Convention.
Australia, Japan and Switzerland reserved their third-party rights. The
dispute focused on the business exemption of Section 110(5) of the U.S.
Copyright Act and its partial incompatibility with Article 13 of the
TRIPS Agreement. TRIPS Art. 13 does permit limits on the rights of
copyright holders, provided that those limits do not interfere with
their economic rights or prejudice the legitimate interests. This
author believes that that would also include the moral rights (droit
moral) of the authors. The business exemption of sub-paragraph (B) of
Section 110(5), essentially allowed the on site diffusion of music
broadcasts without an authorization or a payment of a fee by businesses
frequented by the public (stores, cafes, bars, restaurants) provided
that they do not exceed a certain size limit. The business in question may even
use amplification equipment (speakers etc.) provided that such
broadcast or amplification equipment is of the kind ordinarily used in
private homes under the "home style" exemption.
The
panel determined that the "business" exemption provided for in
sub-paragraph (B) of Section 110(5) of the U.S. Copyright Act did not
meet the requirements of Article 13 of the TRIPS Agreement and was thus
inconsistent with Articles 11bis(1)(iii) and 11(1)(ii) of the Berne
Convention (1971) as incorporated into the TRIPS Agreement by Article
9.1 of that Agreement. At the same time however the panel found that
the "home style" exemption provided for in sub-paragraph (A) *22
of Section 110(5) of the U.S. Copyright Act met the requirements of
Article 13 of the TRIPS Agreement and was thus consistent with Articles
11bis(1)(iii) and 11(1)(ii) of the Berne Convention (1971) as
incorporated into the TRIPS Agreement by Article 9.1 of that Agreement.
Thus the effective decision of that case is that a patron, employer, or
employee may casually use their radio, or even television on the
premises but for personal uses only.
This
decision is open to critique on the merits. First it will be difficult
to enforce. One has difficulty imagining police raids on restaurants
for copyright infringement. The decision can also be criticized for it
reduces the availability of information to consumers. The decision is
even bad for authors since it will reduce the size of the advertising
audience and thus reduces the merchantability of author's works. However it is
also clear that a fair reading of the Berne treaty does indicate that
the E.U. is in its rights to oppose the fair-use "home style" exception
as unfairly depriving authors of their legitimate royalties.
Given
the nature of the case, which ordered the U.S. to amend its internal
law, it is not surprising that its implementation was contentious. The
U.S. did not seek to overturn the decision but rather sought an
extension to the maximum possible time for legislation to correct the
inconsistency between U.S. domestic law and its TRIPS treaty
obligations. Thus rather than appeal the decision the U.S. sought to
negotiate the time frame in which the decision would be implemented
under Article 21.3(c). The question of enforcement was heard before
binding arbitration, pursuant to the DSM. [FN37]
Essentially
the U.S. sought at least 15 months for compliance, and preferably a
full congressional term of two years, due to the change in
administrations caused by the presidential election. The E.U. sought to
limit the U.S. implementation time to a maximum of ten months. The
question then was what exactly is the reasonable time? [FN38]
In
the case the arbitrator found that: "Article 21.3(c) makes clear that
the 'reasonable period of time' may be shorter or longer, depending
upon the 'particular circumstances". The arbitrator noted that the
compliance must be "prompt" and cited previous arbitrators who noted
that reasonable period of time" meant the following: "it is clear that the
reasonable period of time, as determined under Article 21.3(c), should
be the shortest period possible within the legal system of the Member
to implement the recommendations and rulings of the DSB." (emphasis
added)
In
the instance the arbitrator decided that twelve months from the time of
the panel decision would be a reasonable time, noting that legislative
procedures take longer than administrative ones, and that the panel's
decisions should not oblige extraordinary measures to be taken by
members of the trading body, but that ordinary legislative procedures
should normally be allowed.
This
case is very strong evidence in support of the professionalization
thesis. First, the arbitrator's citation to the previous decisions of
the panel shows that the panel is developing a case-law jurisprudence [FN39]
which is one of the preconditions to the normalization of world trade,
i.e. the transformation of international trade disputes from a
political to a juridical system of governance via international
organizations such as the WTO. Second, the WTO has effectively ordered
the United States to alter its internal legal regime and can enforce
that decision. Finally, the case went through the entire process of
negotiations, decision, and enforcement. Were the WTO beset with
inter-élite disputes then this decision would never have been reached:
political pressures would have intervened. Thus the legal practice
confirms the theory of the professionalization thesis.
United States - Section 211 Omnibus Appropriations Act, complaint by the European Communities and its member States (DS176/1). [FN40]
Essentially, a U.S. law prohibits the registration of a trademark which
has fallen into disuse where the mark had been abandoned following
confiscation of the trade mark owner's business assets located in Cuba.
Section 211 of the U.S. Omnibus Appropriations Act was challenged for
inconformity with TRIPS Article 2 and by reference the Paris
Convention's articles 3, 4, 15-21, 41, 42, and 62. Canada, Japan and
Nicaragua reserved their third-party rights.
The
appellate body reversed in part and affirmed in part the decisions
against the United States. This case is paradoxical in that ordinarily
TRIPS is criticised on the grounds that it extends too much protection
over intellectual property. However, in this case TRIPS was being
invoked as a defense against such overreaching. This is not the only
challenge to U.S. laws of intellectual property under TRIPS (infra).
The result of this, qualified and cautious limitation of the U.S.
position, may set the tone for TRIPS as shield to protect the third
world against abuse of intellectual property rights.
B. STATISTICAL ANALYSIS OF THE CASES [FN41]
The
cases studied have been completed either through settlement or through
binding arbitration. As such they illustrate the efficacy of the DSB.
The parties preferred settling in two of the three cases studied which
supports the professionalization thesis since the efficacy of enforcement is key *23
to the validity of that thesis. Were the enforcement mechanism
ineffective, parties would be unlikely to settle. Yet in most cases
parties prefer to settle, at least in this small case survey.
While
half dozen cases are very few, these are nevertheless all cases
involving intellectual property with the U.S. and the E.U. or an E.U.
member state as parties. Further the statistic being studied here is
not stochastic but deterministic, i.e. all parties have volition and
seek strategies to win a positive sum game. Finally the fact that the
DSM is a new legal development explains why there would be few cases
even if we looked at those cases outside the field of intellectual
property and the first world. Is this study reflected in across the
board in the WTO or is it unique to intellectual property questions? In
fact, a survey of all WTO cases confirms the analysis that the dispute
settlement mechanism is effective and encourages settlement. Further
our survey of other cases will show that both the U.S. and the E.U. win
more cases at the WTO than they lose, but that the E.U. tends to do
somewhat better than the U.S.
We
first examine the DSM of the WTO globally because it will confirm our
analysis of intellectual property claims. Many cases either settle or
are dropped outright.
--------------------------------------------------------------------------------
THE WTO DISPUTE SETTLEMENT MECHANISM SINCE JANUARY 1, 1995
--------------------------------------------------------------------------------
Complaints Active Cases Appellate Body Settled or
Notified to the [FN2] and Panel Inactive
WTO [FN1] Reports Cases [FN4]
Adopted [FN3]
--------------------------------------------------------------------------------
Number of 228 (175 of which 16 47 36
Cases involve
distinct
matters)
--------------------------------------------------------------------------------
See: WTO at http://www.wto.org/
Explanatory notes:
--------------------------------------------------------------------------------
FN1. This category encompasses all requests for consultations notified to the
WTO, including those requests which have led to panel and appellate review
proceedings.
FN2. This category encompasses pending or suspended panel proceedings or
appellate review proceedings, with the exception of proceedings pursuant to
Article 21.5 of the DSB.
FN3. This category does not include reports resulting from proceedings pursuant
to Article 21.5 of the DSB.
FN4. This category includes cases where the contested measure has been
terminated, a panel request was withdrawn, etc.
About
half of E.U. complaints reach panel stage, whereas only about 1/3 of
claims against the E.U. reach panel stage. This is illustrated at right.
However
this correlation is not itself a proof of the reasonability of the
E.U.: for example if the E.U. has "overplayed" its hand early in the
settlement process then settlement would be the best choice. More
interestingly the number of cases brought against the E.U. which go to
panel have dropped in a linear fashion from 1995 (over 1/3) to none in
1999 so apparently the E.U. is becoming skilled at the procedures.
U.S. and European cases together are the majority of WTO DSB cases. Both tend
to win their cases but the E.U. tends to win more cases than the U.S.
--------------------------------------------------------------------------------
THE E.U. BEFORE THE WTO
--------------------------------------------------------------------------------
Complainant Defendant Third Party Total
--------------------------------------------------------------------------------
Request Panel Request Panel Request Panel WTO
Consult Consult Consult Total
--------------------------------------------------------------------------------
1995 2 1 8 3 2 1 25
--------------------------------------------------------------------------------
1996 7 1 4 3 11 3 39
--------------------------------------------------------------------------------
1997 16 6 4 3 11 4 50
--------------------------------------------------------------------------------
1998 16 4 9 1 0 2 41
--------------------------------------------------------------------------------
1999 6 9 3 1 4 8 30
--------------------------------------------------------------------------------
1999 8 4 3 0 5 8 39
-------------------------------------------------------------------------------
TOTAL 55 25 31 11 33 26 219
--------------------------------------------------------------------------------
See: WTO at http://www.wto.org/
--------------------------------------------------------------------------------
1995 2 1 8 3 2 1 25
--------------------------------------------------------------------------------
1999 8 4 3 0 5 8 39
--------------------------------------------------------------------------------
Average 9 4 5 ~1 5 5 36
--------------------------------------------------------------------------------
Trend + + - - + + +
--------------------------------------------------------------------------------
See: E.U. Multilateral Issues: Dispute Settlement, Overview at
http://europa.eu.int/comm/trade/miti/dispute/overview.htm Summaries of all
DSU litigation can be seen at: "Basic Information for WTO Dispute Cases" at
http://www.law.georgetown.edu/iiel/DSUTable1.doc
--------------------------------------------------------------------------------
TOTAL CASES AT THE WTO INVOLVING THE U.S. OR THE E.U.
-------------------------------------------------------------------------------
Initial Data Derived Data
--------------------------------------------------------------------------------
Plaintiffs Defendants Ratio of Plaintiffs to
Defendants Total
--------------------------------------------------------------------------------
U.S. 30 25 1.2
--------------------------------------------------------------------------------
E.U. 26 17 1.5
--------------------------------------------------------------------------------
Others 44
--------------------------------------------------------------------------------
See: WTO at http://www.wto.org/ However while the U.S. and E.U. both go before
the WTO more often than all other WTO members the U.S. does not do as well as
the E.U.-although the U.S. wins more cases than it loses.
--------------------------------------------------------------------------------
WINS VS. LOSSES OF THE U.S. AND E.U. BEFORE THE WTO
--------------------------------------------------------------------------------
Initial Data Derived Ratios
-------------------------------------------------------------------------------
U.S. as Plaintiff U.S. as Total
Defendant
--------------------------------------------------------------------------------
Wins: 13 1 14 Wins to Losses: 1.7
--------------------------------------------------------------------------------
Draws: 10 10 20 Wins to Total: 0.32
--------------------------------------------------------
Losses: 2 6 6
--------------------------------------------------------------------------------
See: US GAO Briefing Report WTO Experience in Dispute Settlement, June 2000
GAO/NSIAD/OG C -00-196BR. Derived Ratios: Author.
*24
This data shows that while the E.U. does better at the WTO than the
U.S. the U.S. still wins more cases than it loses. One could conclude
from this mere statistic either that the E.U. is a sharp negotiator or
that it has outright "captured" the DSB. We do not make either
conclusion since each case has to be considered on its merits.
Statistical studies tend not to prove but to corroborate evidence
gathered through thorough analysis of concrete cases on their merits.
There is a lesser correlation of cases invoking the DSB by the E.U.
going to panel that fluctuates but on average shows greater invocation
of the DSB by the E.U. At the same time however we
can see that all members are more and more regularly using the DSB,
this fact tends to support the professionalization thesis.
Thus
an argument that the E.U. does well at the WTO because of agency
"capture" (regulators effectively acquiring self regulatory power
through informal professional ties) appears ill founded. "Playing the
game well" is not the same as "cheating". To the extent that the "game"
of the WTO represents a subjective zero sum game (the conflict to see
who will win or lose the dispute) in the larger positive sum game of
trade would imply that the E.U. must have a winning strategy if it
wins. Even in cooperative positive sum games such as trade there are
still relative winners and losers. Both the U.S. and the E.U. are
absolute winners in global trade though the E.U. is winning slightly
more than the U.S. This fact becomes clearer when one considers the
position of the first world and compares it with the third world [FN42]-or even Eastern Europe.
This
thesis of bureaucratic neutrality and fairness can also be supported
when we remember that there are similar symmetric cases either pending
or resolved which have or may be found in the U.S. favor. While the
Brazilian case seems likely to result in an ambiguous condemnation of
non-tariff barriers coupled with an affirmation of state sovereignty,
the cases involving Europe are rather clearer. Sweden smartly accepted
the inadequacy of its laws, and has taken or is taking steps to redress them having settled.
Greece may or may not insist on going to panel, but if the facts were
as the U.S. claimed, then they would also be wiser to settle. These
cases demonstrate the "normalization" thesis. This thesis argues that
the formerly political area of trade disputes can be better handled
through juridical structures such as the WTO's DSM. Since we see
symmetrical issues and similar outcomes the normalization thesis is
operationally compelling, at least when considered within its own terms.
How
then to explain the necessarily costly U.S. intransigence in the field
of intellectual property law? The loss suffered by the U.S. before the
WTO in the case of 110(5) of the copyright act and Art. 337 demonstrate
tactical errors by the US. Strategically the U.S. has been a long time
advocate of market capitalism and free trade has, as a result of its
cold war victory been able to forge a regime for global trade
liberalization. However in seeking to *25
maintain its own laws even where they are in contravention of the
regime that its foreign policy elites created it is not merely behaving
unreasonably and overreaching its own power-it is also making tactical
errors which are not only embarrassing but also costly. To put it
colloquially, in its persistent attempts to unilaterally impose its
agenda the U.S. has "overplayed its hand".
The normalization thesis seems reasonably well supported through this
limited empirical study. However no system, no
matter how well conceived, is ever perfect. Thus we can ask ourselves
what types of reforms have been requested or proposed for this system?
One point that might be important is that the E.U. does not, de facto,
give the WTO implementation any vertical direct effect. [FN43] Individuals are not granted any right by the implementation of law pursuant to enforcing the WTO agreement (dicta). [FN44] Further only persons with a concrete interest have standing to sue before the WTO. [FN45]
Another
proposal has been to permit greater third party participation either in
the panel or appellate process or both. Requiring the panel to consider
amicus curiae briefs would be one way to increase democratic legitimacy
of the panel or appellate body. The amicus curiae is a non-implicated
third party. Their brief is simply an argument in favor of what they
see as the best resolution of the case or facts. The court is currently
free to ignore amicus curiae briefs. However a well founded and
properly filed brief will in ordinary practice at least be read. Thus
the practice of requiring consideration of amicus curiae briefs would
cost the court nothing in terms of obligation but would increase the
sense of fairness and democracy since in such a case NGOs, and the
people they represent, would be able to have a voice on decisions, if
only in theory.
Other
reforms are possible. The E.U. argues for an acceleration of some
elements of the process, though others argue that the process is
already too rapid. The E.U. also argues for the creation of professional full time panels. [FN46]
Other reforms have been proposed by the E.U. permitting the joinder of
multiple defendants and facilitating third party intervention. [FN47] Still others suggest that the WTO should address environmental concerns. [FN48]
The reforms proposed by the E.U. seem to be only procedural rather than
substantive-which is a further support for the "normalization" thesis
that the DSB is succeeding in transforming the uncertain and costly
political treatment of trade disputes into a smoother juristic model.
The
statutory and case law cited supports the arguments of the
professionalization thesis. In practice the DSB of the WTO is an
example of Weberian bureaucratic professionalism and proves the
validity of functionalist theory.
Some
commentators may not like the loss of sovereignty involved in
establishing a multilateral binding trade liberalization system.
However if one is consistent with liberal economic theory that is
exactly what is required [FN49]
to ensure global free trade. That end can be further justified in that
open global trade ensures world peace not only through augmenting
production but also by disassociating production and political
territorium. Rather than conquering foreign countries a free trading
system seeks to "conquer" market share. If anti-trust laws be
effective and if free trade is taken seriously then by encouraging
specialization (on this point see Ricardo) it will augment global
wealth reducing global violence.
The
professionalization thesis, that the WTO is replacing political
procedures with juristic ones, is empirically validated by this study
that shows that the proceedings work to "filter" and determine at each
stage the different issues litigated. This filtering and decision
process is less contentious than the political regime which it
replaced. This is also shown by the fact that the decisions of the
court are even handed and do not arbitrarily favor any particular state.
This
study has also shown the surprising point that TRIPS can serve either
to support or deny intellectual property rights. This use of TRIPS as a
shield for example in opposition to multinational and first world
predation of third world labor and resources may be further evidence of
the impartiality of the panel and appellate body. It will in all events
be key to maintaining a stable and fair global economy.
This
paper's support of the free trade rationale and objectives of the WTO
is however only contingent. Effective antitrust laws are also required
if the competition needed to maintain economic prices is to be had.
Without it globalization would become monopolization as the series of
mega-mergers in the last decade has shown. These are not the only
reasons that theoretical support of the WTO support must be contingent upon
practical realities. One can critique the structure of the WTO as being
undemocratic and thus illegitimate. The WTO is essentially a conference
of bankers and government representatives with little real popular
input. Worse this is necessarily so: since liberalization implies
elimination of inefficient national industries everywhere. Thus the WTO
cannot be democratic if it is to obtain the goal of global free trade.
This inevitable lack of democratic legitimacy explains why a
theoretically *26
good idea must be in practice contingent upon an effective competition
regime. A politically illegitimate institution will be nevertheless
tolerated if it is economically effective and substantively fair.
However without an effective anti-trust regime the WTO would turn into
a vehicle for monopoly domination of the global marketplace.
A
second ground for skepticism is that while the WTO does not have
democratic support it could have avoided popular backlash-and has
failed to do so. Visiting the next local WTO conference alone can prove
this fact. For these reasons while the theoretical goals of peace
through prosperity growing out of trade and the disassociation of the
national economy and the state via globalization are in fact legitimate
goals they can only be obtained if they are founded upon a serious
anti-trust regime to maintain competition to keep prices low and to
prevent monopoly profits for hyper-national corporations.
Commentators have noted the problematic nature of jurisdictional expansionism
of the Appellate body [FN50]
as well as it democratic deficit. However the relationship between
democracy and free trade is problematic if not antithetical. Prior to
the WTO the political processes of GATT often raised the spectre of
trade-war. And prior to the last world war trade disputes were often
the cause of war. So solving democratic deficit may not be desirable.
This is all the more so because the objectives of the WTO, global peace
and prosperity, are outside the ambit of most persons daily lives and
can even be in opposition to their parochial interests. Free trade may
be good for all, but in risk averse conservative societies is
resisted-and not only in the third world. Seeking democratic input,
even if it did not risk maintenance of inefficient industries, would
risk demagoguery. Further popular input in trade issues did not work at
all prior to GATT and only worked badly during GATT. During the WTO the
absence of democracy has resulted in rioting-which is preferable to war
and even possibly preferable to trade war. Rather than seeking
democratic support for policies which, if pursued in a principled
manner would indeed augment global wealth, the WTO should seek merely
to avoid alienating consumers which it can do if it is consistent in
its free trade/competition rationale.
Although
the DSB of the WTO has not bridged the gap between transformationalism
and realism, perhaps that gap is unbridgeable. It is clear that closed
borders and poverty lead to war and that prosperity brings peace.
Theoretically open borders and trade will lead to prosperity-if that
prosperity is shared by all it will also lead to peace. So
while utopian ideals may not be met, and persistent democratic deficit
will be the norm, perhaps the WTO will be able to meet more prosaic
daily needs. That remains to be seen.
[FNa1]. Eric Engle earned a
Bachelor of Arts in Political Studies from Queen's University in
Kingston, Ontario and a Juris Doctor from Saint Louis University School
of Law. Mr. Engle later went on to obtain a D.E.A. in Legal Theory from
the University of Paris X Nanterre, and another D.E.A. in Taxation and
Public Finance Law at the University of Paris II. He also holds an
LL.M. from Bremen University in the Federal Republic of Germany.
Currently, Mr. Engle is pursuing a Doctorate in Fiscal Law at the
University of Paris II. Professionally, Mr. Engle is a Research Fellow
at the Center for European Law and Policy at the University of Bremen
where he teaches courses in common law. Earlier in his career he was a
Professor of Law at the Creápole-ESDI in Paris, France. His
publications address topics such as the U.S. Federal Communications
Commission regulation of political broadcasts, critical legal studies
in America, and European fiscal law. His personal website is at http://
lexnet.bravepages.com
[FN1]. See, e.g. James
Cameron, Kevin R. Gray, Principles of International Law in the WTO
Dispute Settlement Body, 50 Int'l. & Comp. L.Q. 247, (April 2001) (Book Review).
[FN2]. See , "Understanding on rules and procedures governing the settlement of disputes, Apr. 15 1994, Annex 2, Legal Instruments-Results of the Uruguay Round vol. 1 (1994), 33 I.L.M. 1125(1994); available at, http:// www.wto.org/english/tratop_e/dispu_e/dsu_e.htm
[FN3]. For a critical view of the professionalization thesis, See, e.g.: John A. Ragosta, Unmasking
the WTO: Access to the DSB System: Can the WTO Live Up To the Moniker
'World Trade Court'?, 31 L. & Policy Int'l. Bus. 739 (2000),
available at, http://http://docsonline.wto.org/GEN_searchResult.asp?
RN=0&searchtype=browse&q1=%28@meta_Symbol+LTüURüA1Au2%29+%26+%28@meta_
Types+Legal+text%29
[FN4]. Sharon Jones,
Bureaucracy, available at, http://
management.canberra.edu.au/lectures/adminstudies/sem972/unit4207/Bureaucracy.html
(last modified Aug. 1997), see also, R.J. Kilcullen , Max Weber: On
Bureaucracy (1996), available at, http://
www.humanities.mq.edu.au/politics/y64l09.html
[FN5]. While at least one person, Carlo Giuliani, has been martyred by the
police in the anti-WTO protests, a comparison with
the violence attendant to the Israeli occupation of Palestine and the
reaction of the Intifadah explains why the claim that anti-WTO protest
is relatively non-violent is justified. The Intifadah proves that low
tech weapons work, yet we do not see kamikaze bombers at the WTO
protests. Martyrdom is the correct word: See, e.g.
http://www.carlo-giuliani.com/
[FN6]. Rahmatullah Khan, The
Anti-Globalization Protests: Side-show of Global Governance, or Law-
making on the Streets?, Heidelberg J. Int'l. L. 61/2-3(2001), at 323.
("Anti-globalization demonstrations have by now become a standard
feature of meetings of institutions associated with globalization. (As
I finalize this piece, there is a raging demonstration that is going an
in Genoa, Italy, at the G8 summit.) The response to the phenomenon has
varied: the media, barring a few exceptions, goes hysterical over them;
the academia ignores them; and the general public seems to be amused. I
view them with some fascination; for, I suspect anti-globalization
demonstrations have begun to have a measurable impact on global
governance, and are forcing U.S. to view afresh the structured layers
of international policy and law formation.")
[FN7]. For a discussion of
Trips and the DSB in a global context see, Benedicte Callan, The
Potential for Transatlantic Cooperation on Intellectual Property, (BRIE, Working Paper No. 116, 1998), available at, http:// bis.berkeley.edu/~briewww/pubs/wp/wp116.html
[FN8]. Joost Pauwelyn, The
Role of Public International Law in the WTO: How Far Can We Go?, 95 Am.
J. Int'l. L. 535, 553 (2001)("At first glance, one may doubt whether
the DSU actually provides for the judicial settlement of disputes.
First, contrary to the Appellate Body WTO panels are not standing
bodies but ad hoc tribunals created pursuant to predetermined
procedures in the DSU. Panels must be established ad hoc for each case
by the WTO Dispute Settlement Body. (They cannot be established by the
mere will of the disputing parties). Still, their establishment is
quasi-automatic pursuant to the negative consensus rule in DSU Article
6 (1). In terms of their mode of establishment, panels could thus be
qualified as encompassing a mixture between arbitration and judicial
dispute settlement ... The legal findings and conclusions of both
panels and the Appellate Body culminate only in "recommendations" to
the defending party. These recommendations must still be adopted by the
Dispute Settlement Body to obtain their legally binding force [albeit]
quasi-automatically (under DSU Articles 16.4 and 17.14). At most, this
procedure could mean that the WTO judiciary includes the WTO Dispute
Settlement Body. In practice, however, both panels and the Appellate
Body are established, operate, and reach their legal conclusions in an
entirely independent and law-
based fashion. They are judicial tribunals in the international law sense.")
[FN9]. For an example of
German Reporting of WTO panel reports, See, Nikolaos Lavranos, Die
Rechtswirkung von WTO panel reports in Europäischen Gemeinschafts-
recht sowie im deutschen Verfassungsrecht, EuropaRecht, 289 EuR-Heft 3
(1999), at 289. (In diesem Zusammenhang gehört auch die Forderung, daß
die endgültig festgestellten panel reports als rechtlich bindende
quasi-Urteile und damit als verbindliche Interpretation der WTO
Verträge vom EuGH anerkannt und beachtet werden müssen.)
[FN10]. For the entire text
of the TBR See, EU: "Council Regulation (EC) No 3286/94 of 22 December
1994, available at, http://
europa.eu.int/comm/trade/policy/traderegul/adgreg06a.htm (1994) (laying
down Community procedures in the field of the common commercial policy
in order to ensure the exercise of the Community's rights under
international trade rules, in particular those established under the
auspices of the World Trade Organization)
[FN11]. James Cameron and
Kevin R. Gray, Principles of International Law in the WTO Dispute
Settlement Body, Int'l. & Comp. L. Q., Vol. 50, 248, (Apr. 2001),
at 295.[hereinafter: Cameron, Gray, Int'l. & Comp. L. Q., Vol. 50
248]
[FN12]. See Folkert Graafsma
and Sofia Alves, International Trade Developments, Including Commercial
Defence Actions, European J. Int'l. L., Vol. 9, No. 2 (1998)(discussion
the tensions in transatlantic trade relative to the TBR), available at,
http://www.ejil.org/journal/Vol9/No2/sr1.html; http://
www.ejil.org/journal/Vol9/No2/sr1-08.html#P359_49123
[FN13]. See, EU, Trade Policy Instruments, available at, http:// europa.eu.int/comm/trade/policy/traderegul/compl.htm
[FN14]. For the text of the
regulation see: E.U., Council Regulation 3286 /94 22 Dec. 1994,
available at, http://
europa.eu.int/eurlex/en/consleg/pdf/1994/en_1994R3286_pr_001.pdf
[FN15]. See, EU, Trade Policy Instruments, available at, http:// europa.eu.int/comm/trade/policy/traderegul/reg_02.htm
[FN16]. Petros C. Mavroidis,
Remedies in the WTO Legal System: Between a Rock and a Hard Place,
European J. Int'l. L., Vol. 11 No. 4, 763-8l, 778 (2000) (An argument
in favor of effects based reasoning is that it is a method also used by
the WTO. However have member states considered the threat to their sovereignty and the popular legitimacy of trade bodies that prospective judgment entails?)
[FN17]. See, WTO,
Understanding on Rules and Procedures Governing the Settlement of
Disputes, Annex 2 of the WTO Agreement, available at, http://
www.wto.org/english/docs_e/legal_e/final_e.htm
[FN18]. See, WTO, Legal
Texts: The Uruguay Round Final Act: full texts, Annex 2: Understanding
On Rules And Procedures Governing The Settlement Of Disputes, available
at, http://www.wto.org/english/docs_e/legal_e/final_e.htm
[FN19]. supra, n. 11,
Cameron, Gray, Int'l. & Comp. L. Q., Vol. 50 248, The DSB,
especially the Appellate Body, has many characteristics of an
administrative tribunal)
[FN20]. WTO, Dispute
Settlement: Working procedures for appellate review, (Feb. 1997) §§
23(1), 24, available at, http://www.wto.org/english/tratop_
e/dispu_e/ab3_e.htm (last visited Nov. 18, 2002).
[FN21]. Chakravarthi
Raghavan, Appellate body asserts right to receive amicus curiae briefs,
Third World Network, available at, http:// www.twnside.org.sg/title/amicus.htm (Note that
the Appellate Body of the WTO does in fact assert its procedural right
to accept and consider amicus curiae briefs from individuals and
organizations both members and non members of the WTO, ignoring the
harsh criticism it got from most members in 1998 for accepting and
considering amicus briefs in the Shrimp-Turtle dispute").
[FN22]. EU, Contribution of
the E.C. and its Member States to the Improvement of the WTO Dispute
Settlement Understanding, Mar. 13, 2002, Dispute Settlement Body:
Special Session at Part I(B), available at, http://
europa.eu.int/comm/trade/pdf/disp_100702.pdf.
[FN23]. Understanding on
Rules and Procedures Governing the Settlement of Disputes, WTO
Agreement, Annex 2, art. 17, § 3, available at, http://
www.sunsonline.org/trade/docof/28-dsu.htm (last visited Nov. 18, 2002).
[FN24]. Id.
[FN25]. Petros C. Mavroidis,
Remedies in the WTO Legal System: Between a Rock and a Hard Place,
European J. Int'l. L., Vol. 11 No. 4 (2000), 763-8l, 793. ("Practice
seems to emerge according to which the extent of the reasonable period
of time depends on ... whether legislative action according to domestic
constitutional channels is necessary for the act
found to be illegal to be brought into conformity with the WTO
contract.").[hereinafter, Mavroidis, European J. Int'l. L., Vol. 11 No.
4]
[FN26]. supra, n. 11., Cameron, Gray, Int'l. & Comp. L. Q., Vol. 50 248
[FN27]. Supra, n. 25,
European J. Int'l. L., Vol. 11 No. 4 , at 800. ("According to Article
22(4) DSU countermeasures must be equivalent to the level of
nullification of impairment. From a technical point of view, the term
'equivalent' makes it plain that there is no room for punitive damages
in the WTO context.")
[FN28]. See, e.g. Chad Bown,
On the Economic Success of GATT/WTO Dispute Settlement, (Dec. 2001),
available at, http://people.brandeis.edu/~ cbown/papers/outcome.pdf
[FN29]. This case is
available on-line at the WTO site: United States-Section 337 of the
Tariff Act of 1930 and Amendments Thereto-Request for consultations by
the E.C. and the Member States, WT/DS186/1 (Jan. 18, 2000), available
at, http://www.wto.org/english/tratop_e/dispu_e/dispu_status_e.htm
[FN30].
WTO, United States-U.S. Patents Code, Request for Consultations by
Brazil, WT/DS224/, available at,
http://www.wto.org/english/tratop_e/dispu_ e/dispu_status_e.htm
[FN31]. Id., see also, http://www.ipo.org/2001/IPcourts/Brazil.pdf
[FN32]. WTO, Sweden-Measures
Affecting the Enforcement of Intellectual Property Rights, WT/DS86/1,
available at, http://www.wto.org/english/tratop_
e/dispu_e/dispu_status_e.htm
[FN33]. WTO, Portugal-Patent
Protection Under the Industrial Property Act-Request for Consultations
by the U.S., WT/DS37/1 (May 1996), available at,
http://www.wto.org/english/tratop_e/dispu_e/dispu_status_e.htm; see
also, WTO, Portugal-Patent Protection Under the Industrial Property
Act-Notification of Mutually Agreed Solution, WT/DS86/2 (Oct 1996),
available at, http://
www.wto.org/english/tratop_e/dispu_e/dispu_status_e.htm.
[FN34]. Id.
[FN35]. WTO, European
Communities-Enforcement of Intellectual Property Rights for Motions
Pictures and Television Programs, WT/DS125/2IP/D/14/Add.1, (Mar 2001), available at,
http://www.wto.org/english/tratop_e/dispu_e/dispu_ status_e.htm.; See
also, http://www.usembassy.gr/rights.htm
[FN36]. WTO, U.S.-Section
110(5) of U.S. Copyright Act, (Nov 2002), available at,
http://www.wto.org/english/tratop_e/dispu_e/dispu_status_e.htm; see
also, WTO, S.-Section 110(5) of U.S. Copyright Act, (Nov 2002),
available at,
http://www.wto.org/english/traptop_e/dispu_e/dispu_staTUS_e.htm.
[FN37]. Id.; See also, WTO,
U.S.-Section 110(5) of U.S. Copyright Act, (Jan 2001), available at,
http://www.dosconline.wto.org/WT/DS160-12.DOC.HTM
[FN38]. Supra, n. 36.
[FN39]. Supra, n. 11,
Cameron, Gray, Int'l. & Comp. L. Q., Vol. 50 24 4, 275, "In the new
era in dispute settlement it appears that the development of case-law
under the WTO Dispute Settlement Body may provide guidance".
[FN40]. WTO, U.S.-Sec'n. 211
Omnibus Appropriations Act of 1998- Communication from the Appellate
Body, (July 1999), WT/DS176/1/ABR (Appellate Body) WT/DS176/R (Panel),
available at, http://www.wto.org/english/traptop_
e/dispu_e/dispu_status_e.htm#1999.
[FN41]. For statistics on
transparency, timeliness, and panel arbitrators see, Terence Stewart,
Amy Karpel, "Review of the Dispute Settlement Understanding: Operation
of Panels" The First Five Years of the WTO, Am. Bar Association Sec'n
of Int'l L. & Prac., available at, http://
www.law.georgetown.edu/journals/lpib/symp00/stewart.pdf; see also,
Daniel Drache, Amy Arnott, Yunxiang Guan, "WTO Dispute Settlement
Report Card", Robarts Centre for Canadian Studies, available at,
http:// www.robarts.yorku.ca/pdf/wto_dispute_report.pdf
[FN42]. For an excellent
list of links to third world intellectual property issues under TRIPs
see: http://www.cid.harvard.edu/cidtrade/Issues/ipr.html
[FN43]. For further
information on the possibility of direct effect and vertical effect of
the WTO in the E.U. see, Pascal Royla WTO Recht - EG-Recht: Kollision,
Justiziabilität, Implementntion Europarecht, EuR-Heft 4-2 ll p. 495
(which contemplates the possibility of direct vertical effect of the
WTO on the E.U. and its citizens).
[FN44]. Steve Peers, "W.T.O.
dispute settlement and Community law", 26 E.L.Rev. Dec. 605 (2001),
"The Court of Justice and Court of First Instance have recently ruled that amendments to the E.C.
banana regime dating from 1998 were not intended to implement W.T.O.
obligations despite their apparent link with rulings of the W.T.O.
dispute settlement body. This means that the legislation cannot fall
within the "implementation exceptions" which allow individuals to
challenge the legality of Community measures In light of the WTO."
[FN45]. Mavroidis, European J. Int'l. L., Vol. 11 No. 4, 763-8l, 777.
[FN46]. Commision, Trade :
Multilateral Issues: Dispute Settlement : Overview : The WTO dispute
System is Succeeding, available at, http://
europa.eu.int/comm/trade/miti/dispute/overview.htm.
[FN47]. Commision, Trade :
Multilateral Issues : Dispute Settlement : Contribution of the WTO :
Discussion Paper from the European Communities : Review of the Dispute
Settlement Understanding (DSU), available at, http://
europa.eu.int/comm/trade/miti/new_dispute/0212dstl.htm
[FN48]. John Jackson, "The
Role and Effectiveness of the WTO Dispute Settlement Mechanism"
Brookings Trade Forum, available at http://
muse.jhu.edu/demo/btf/2000.1jackson01.pdf , (also providing statistical
information).
[FN49]. American Laws are Subject to Harmonization-Here's Proof, available at, http://www.iahf.com/usa/20001212a.html.
[FN50]. See, Chakravarthi
Raghavan, "WTO Appellate Body Extending its Jurisdiction?", available
at, http://www.twnside.org.sg/title/juris-cn.htm.