Dispute Settlement in the WTO: An Update and Some Reflections

of a Soon-To-Retire WTO Legal Adviser

Presentation to the Washington International Trade Association (WITA)

Bruce WilsonDirector, Legal Affairs Division

WTO Secretariat April 28, 2010

(Embargoed until Delivered)

Order of Presentation

• Introduction • Current Activity in WTO Dispute Settlement System • Recent Developments of Interest at the Panel/Compliance

Panel/Arbitration Level• Compliance/Implementation Developments of Note• Recent Appellate Body Happenings (or Lack Thereof)• Some Predictions About What Lies Ahead in WTO Dispute

Settlement• Some Reflections on My Eight Year Tenure as WTO Legal Adviser • A Final Word About LAD and Succession

-- Attached to this presentation are three documents – a statistical overview of WTO dispute settlement activity from 1995 through the present, a listing of current cases in WTO litigation, a listing of completed panel/compliance panel/arbitration proceedings

Introduction

• Fourth and final presentation on this topic in my current position.

• Will dispense with the statistical information of a historical nature; I have included a lot this info in three handouts available in the room.

• Focus today will be on recent and current developments, and then share some personal reflections.

• My position is one of best legal jobs in the world in the field of international trade.

• As is customary practice, due to WTO Rules of Conduct, I will not comment on individual cases.

• But welcome your own comments about individual cases that have been decided.

Current Activity in WTO Dispute Settlement

• Current level of litigation activity at the panel level is the highest it has ever been – 19 original panel proceedings

• 10 are non trade remedy cases and 9 are trade remedy cases • Currently no IP, Ag, or Services cases are in litigation• There is one 22.6 Arbitration • No ongoing compliance panels, 21.3 RPT arbitrations, appeals• US (15) continues to be most active litigating Member (5 as C, 10 as

R)• EU (9) continues as second most active litigating Member (4 as C,

5 as R)• China (6) has become third most active litigating Member (5 as C, 1

as R)• Only 11 other Members are currently active as a C or R

Recent Developments of Interest at Panel/Compliance Panel/Arbitration Level

• Increased time to produce panel reports • Litigation continues to be primarily among a dozen or so Members• China’s increasing role as a complainant• Continued request for preliminary rulings• Recent Surge in SPS/TBT cases• Continued litigation over use US use of zeroing in administrative

reviews of AD orders• Appearance of new litigants – e.g. Vietnam, several Arab countries

as 3rd Ps• Issuance finally of EC-Airbus report with US-Boeing report later this

year (longest panel proceedings in WTO history)• Inactivity of compliance panels over past 18 months • Continued non-uniform approach in arbitrations over permissible

level of retaliation (as manifested in US-Cotton Subsidies arbitration)

Compliance/Implementation Developments

• Continued stated commitment by all to comply with WTO rulings, which reinforces the legitimacy of the system.

• A number of negotiated settlements involving EU have occurred over last year flowing from past WTO litigation – EC-Beef Hormones, EC-Bananas, EC-GMOS (with Canada, Argentina but not US); use of DG as a mediator in EC-Bananas dispute.

• By contrast, continuing concerns about lack of, or delay in, compliance by US in a number of cases.

• US/Brazil agreement over compensation in US-Cotton subsidies case in recent days has captured everyone’s attention.

• Recent EU use of increased export subsidies in sugar has created angst among the complaining parties in the original case

• First experience with Chinese compliance with adverse panel/AB reports has generally been positive from all indications.

Recent Appellate Body Happenings

• 2 new AB Members in 2009 – Van den Bosche (Belgium) replacing Sacerdoti (Italy) and Ramirez (Mexico) replacing Baptista (Brazil)

• After extremely busy 2008, there has been a marked decrease in appellate litigation in 2009 and 2010 ). No appeals expected before late summer or early fall this year.

• Appellate activity tends to follow and lag panel activity, so we can expect an explosion of appellate activity in fall of 2010 and throughout all of 2011 and well into 2012

• AB has embarked on first set of amendments to its procedures since 2004 and hopes to have those in place later this year

Some Predictions About What Lies Aheadin WTO Dispute Settlement

• WTO Dispute Settlement System will continue to be used actively • China has become and will continue to be among the top three

litigating parties in the WTO along with the US and the EU• U.S. will continue to resolve zeroing complaints on administrative

reviews of AD orders through expedited WTO cases• Challenges to the trade remedy practices of developing countries

will begin to appear in the system • SPS/TBT cases will continue to proliferate• Implementation of adverse WTO reports by US requiring legislative

action will only ultimately be resolved as part of a fast track bill implementing the results of the Doha Round

• Appellate activity, as noted previously, will resume vigorously this fall and continue at a heavy pace at least through 2012.

Some Reflections on My Tenure as WTO Legal Adviser

• WTO and, especially its dispute settlement system, has moved from a somewhat difficult beginning to a much more mature and stable organization with global legitimacy

• The ultimate success or failure of the DS system depends on the performance and behaviour a varied and broad cross-section of players.

• Collective commitment to the system, but special mention of work of panel adjudicators.

• Their hard work and dedication and their determination to deliver quality reports and well-reasoned decisions is impressive and inspiring

Reflections (cont.)

• LAD has assisted on some 50 different litigation proceedings during my tenure (including 11 proceedings currently underway)

• Bringing more transparency to the WTO DS system

• Assisting the WTO on other legal issues

• It has been a fascinating, exciting, and deeply rewarding eight years for me.

A Final Word About LAD and Succession

• Many individuals in the WTO assist in the operation of the DS system

• However, in closing, I would like to pay special tribute to my colleagues in LAD with whom I have had the pleasure to work over these past eight years.

• As befits a multilateral organization, LAD represents 14 different nationalities and, although most WTO litigation is done in English, we collectively speak 10 different languages.

• I like to think that LAD is a shining example of the professionalism, technical competence, dedication, and hard work of WTO Secretariat staff.

• LAD has the best internship program in the WTO

• Finally, a word about my successor, Ms. Valerie Hughes of Canada