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International Trade Regulation. Victor H. Bouganim WCL, American University. The New International Order. Multilateral. Regional. Global. Bi-lateral agreements. GATT. G eneral A greement on T ariffs and T rade - PowerPoint PPT Presentation
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International Trade International Trade RegulationRegulation
Victor H. Bouganim
WCL, American University
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 2
The New International OrderThe New International Order
Multilateral Multilateral
RegionalRegional GlobalGlobal
Bi-lateralBi-lateralagreementsagreements
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 3
GGeneral AAgreement on TTariffs and TTrade GATT negotiations start after world war II GATT negotiations start after world war II
in order to facilitate international trade.in order to facilitate international trade. The Uruguay round introduces, among The Uruguay round introduces, among
other things, the issue of IP in 1986. other things, the issue of IP in 1986. The final agreements were concluded on The final agreements were concluded on
December 1993 and signed on April 1994 December 1993 and signed on April 1994 in Marrakech. in Marrakech.
The final agreements established the The final agreements established the WTO - The World Trade WTO - The World Trade Organization.Organization.
GATTGATT
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 4
GATT/WTO ObjectivesGATT/WTO Objectives Embodies the core
principles of liberal market theory:– Reduction of custom
duties and removal of non-tariffs trade barriers
– “Most favored nation” principle
Dispute settlement of trade issues
Ultimate goals Increasing the
world trade volume Raising the
standard of living - globally
Providing for full employment
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 5
WTO StructureWTO Structure
DirectorDirectorGeneralGeneral
SecretariatSecretariat
CommitteeCommitteeon Tradeon Trade
& Development& Development
CommitteeCommittee on Balance of Paymenton Balance of Payment
RestrictionsRestrictions
CommitteeCommitteeon Budget, Financeon Budget, Finance
& Administration& Administration
MinisterialMinisterialConferenceConference
Trade PolicyTrade PolicyReview BodyReview Body
Dispute SettlementDispute SettlementBodyBody
Council forCouncil forTrade in GoodsTrade in Goods
Council forCouncil forTrade in ServicesTrade in Services
Council forCouncil forTRIPsTRIPs
GeneralGeneralCouncilCouncil
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 6
Dispute Settlement under WTODispute Settlement under WTO
Dispute Settlement Body: special assembly of WTO General Council, includes all members
Five stages to dispute resolution: Consultation Panel establishment, investigation and report Appellate review of the panel report Adoption of the panel and appellate decision Implementation of the decision adopted
Could also have binding arbitration as alternative
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 7
WTO Dispute Settlement BodyWTO Dispute Settlement Body
WTO Principles: – equitable, fast, effective, mutually acceptable
The Dispute Settlement Body (the General Council in another guise) has the sole authority to establish “panels” of experts to consider the case, and to accept or reject the panels’ findings or the results of an appeal.
It monitors the implementation of the rulings and recommendations, and
has the power to authorize retaliation when a country does not comply with a ruling.
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 8
WTO Dispute Settlement Process - 1WTO Dispute Settlement Process - 1
First stage: consultation Up to 60 days Before taking any other actions the countries
in dispute have to talk to each other to see if they can settle their differences by themselves. If that fails, they can also ask the WTO director-general to mediate or try to help in any other way.
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 9
Second stage: the panel Up to 45 days for a panel to be appointed, plus 6
months for the panel to conclude. If consultations fail, the complaining country can ask
for a panel to be appointed. The country “in the dock” can block the creation of a
panel once, but when the Dispute Settlement Body meets for a second time, the appointment can no longer be blocked (unless there is a consensus against appointing the panel).
WTO Dispute Settlement Process - 2WTO Dispute Settlement Process - 2
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 10
The panel’s final report should normally be given to the parties to the dispute within six months.
In cases of urgency, including those concerning perishable goods, the deadline is shortened to three months.
WTO Dispute Settlement Process - 3WTO Dispute Settlement Process - 3
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 11
WTO Appeals ProcessWTO Appeals Process
Either side can appeal a panel’s ruling. Appeals have to be based on points of law such as legal
interpretation — they cannot reexamine existing evidence or examine new evidence.
The appeal can uphold, modify or reverse the panel’s legal findings and conclusions. Normally appeals should not last more than 60 days, with an absolute maximum of 90 days.
The Dispute Settlement Body has to accept or reject the appeals report within 30 days — and rejection is only possible by consensus.
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 12
WTO Dispute Settlement WTO Dispute Settlement EnforcementEnforcement
The Dispute Settlement Body monitors how adopted rulings are implemented.
Any outstanding case remains on its agenda until the issue is resolved.
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 13
WTO - TRIPsWTO - TRIPs
Trade-Related Aspects of Intellectual Property– a World Trade Organization (WTO) agreement
– does not directly offer a private client any right to challenge the intellectual property laws of other nations
– provides a bases for the US to urge other nations to adopt adequate protection to comply with the TRIPs mandates
– creates standards and obligates WTO members to follow some of the concepts in several international conventions which safeguard intellectual property.
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 14
““Most Favored Nation”Most Favored Nation”
Any advantage, favor, privilege or immunity granted by a member to any other country (or its nationals) shall be accorded immediately and unconditionally to all members (or their nationals).
Exceptions Members entering:
– Customs unions– Free trade areas– Regional
arrangements Preferential treatment
– Under-developed countries
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 15
China’s WTO AccessionChina’s WTO Accession
China's Working Party was established on 4 March 1987.
China's Draft Protocol and Working Party Report are almost completed, and are expected to be finalized in mid-September 2001.
It is expected that WTO Ministers will take a decision on China's terms and conditions of entry into the WTO at the Doha Ministerial Conference in November 2001.
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 16
Regional Trade Unions Regional Trade Unions
EC - EU– EEuropean CCommunity– EEuropean UUnion
NAFTA– NNorth AAmerican FFree
TTrade AArea USA, Canada & Mexico
EFTA - EEA– EEuropean FFree
TTrade AArea
– EEuropean
EEconomic AArea EU plus Norway,
Switzerland ...
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 17
EU - European UnionEU - European Union
15 member sates
Goals– Economic integration
– Ultimately - political union
– Removal of customs
– Free competition
– Harmonized laws
The 4 freedoms
Free movement of – Goods
– Services
– Persons
– Capital
Free movement of information?
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 18
EU and NAFTAEU and NAFTA
Economic integration associations Focus on regional development of
nations with common interests EU and NAFTA suggest that economic
development will depend as much on regional trade agreements as on the worldwide WTO
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 19
International Economic InstitutionsInternational Economic Institutions
International Organizations play a significant role in international trade– created to assume a supportive role in international
business
– e.g. OECD, The South Centre
The United Nations created specialized agencies to administer certain areas of international trade– e.g. WTO, ITU, WIPO, UNCITRAL
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 20
OECDOECD
Organization for Economic Cooperation and Development
Created by nations with mutual trade and investment interests
Composed almost exclusively of developed nations
Free trade advocate, establishing guidelines for multinational corporations
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 21
Bretton Woods ConferenceBretton Woods Conference
Post WWII conference to correct world-wide depression. Creation of:–International Monetary Fund (IMF)–General Agreement on Tariffs and
Trade (GATT)–The World Bank
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 22
IMFIMF
Urge alterations in government policies where there were severe balance of payments dislocations
Restrictions on governments with respect to foreign exchange controls
Lines of credit available to correct imbalances final source of loans for developing nations before
they default on international obligations
© 2001 Victor H. Bouganim, WCL, American University IBT - Intro - 23
The World BankThe World Bank
Formed as a lending agency Provides low interest loans to the poorest
nations Provides panels of experts for arbitration
and conciliation Offers forms of insurance for trade and
investment