Stages of Dispute Settlement at WTO
In case of a dispute arising between 2 or
more member-countries of the WTO, and they have been unable
to resolve the problem through consultations, the procedure
to be followed at the WTO’s Dispute Settlement Body
(DSB) is as follows: -
1. Each side in the dispute presents its case
in writing to the panel.
2. The complaining country (or countries),
the responding country, and those that have announced their
interest in the dispute, make their case at the panel’s
first hearing.
3. The countries involved submit written rebuttals
and present oral arguments at the panel’s second meeting.
4. If one side raises scientific or other
technical matters, the panel may consult experts or appoint
an expert review group to prepare an advisory report.
5. The panel submits the descriptive (factual
and argument) sections of its report to the two sides, giving
them two weeks to comment. This report does not include
findings and conclusions.
6. The panel then submits an interim report,
of its findings and conclusions, to the two sides, giving
them one week to ask for a review.
7. The period of review must not exceed two
weeks. During that time, the panel may hold additional meetings
with the two sides.
8. A final report is submitted to the two
sides and three weeks later, it is circulated to all WTO
members. If the panel decides that the disputed trade measure
does break a WTO agreement or an obligation, it recommends
that the measure be made to conform to WTO rules. The panel
may suggest how this could be done.
9. The report becomes the DSB’s ruling
or recommendation within 60 days unless a consensus rejects
it. Both sides can appeal the report (and in some cases
both sides do).
Appeals
The panel’s ruling may be appealed by
either of the parties involved. However, they can do so
on the basis of legal interpretation only. Neither will
new evidence be examined, nor existing evidence re-examined.
The DSB sets up a permanent 7-member Appellate
Body, which broadly represents all the WTO members. These
members are typically individuals with renowned standing
in the field of law and international trade and should not
be affiliated with any government. 3 members from the Appellate
Body hear each appeal. These members may endorse, modify
or reverse the panel’s legal findings and conclusions.
Rejection of the panel’s decision is only possible
through consensus.
An appeal should not last for more than 60
days, with an absolute maximum of 90 days. The DSB has to
accept or reject the appeals report within 30 days
Implementing the panel’s decision
Once a case has been decided, the losing party
will be required to bring its policy in line with the panel’s
ruling or recommendations immediately or as soon as possible.
If it fails to do so, it will be required to enter into
negotiations with the complaining country (or countries)
in order to determine mutually acceptable compensation.
If after 20 days, no satisfactory compensation
is agreed, the complaining side may request the DSB for
permission to impose limited trade sanctions against the
other side, which should be granted within 30 days, unless
there is a consensus agreement against the request. Sanctions
are usually imposed in the area related to the dispute,
but may also be imposed in a different area, as long as
that is effective.
