On World Trade Organization
Q: What is the World Trade Organization?
The World Trade Organization (WTO) is an international body consisting of 134 member nations. From its headquarters in Geneva, Switzerland, the WTO provides a forum for trade negotiations, administers trade agreements, manages trade disputes and monitors national trade policies.
Representatives of each member government meet periodically in Geneva to monitor and implement ongoing trade agreements. At least once every two years, ministers or heads-of-state meet at WTO Ministerial Meetings to negotiate new trade agreements or to expand on existing agreements.
0: What happened to the General Agreement on Tariffs and Trade (GATT)?
The WTO was created from the Uruguay Round of negotiations of the General Agreement on Tariffs and Trade (GATT 1994), and took effect on January 1, 1995. It superseded the earlier GATT by extending its scope to include new rules on such matters as trade in services and intellectual property.
Perhaps the most significant change to the GATT is that WTO agreements are now legally binding on WTO members. Countries that ratify (or sign on to) agreements sponsored by the WTO are obligated to follow the terms of trade that are reached through multilateral negotiations. If a dispute arises between WTO members, each member has the right to appeal through the dispute settlement system. WTO Agreements include the General Agreement on Tariffs and Trade (GATT) and other goods agreements and annexes, the General Agreement on Trade in Services (GATS) and its annexes, the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS), and the Dispute Settlement Mechanism (DSM).
Q: What is the Dispute Settlement Mechanism?
One important task of the WTO is its role in settling trade disputes between countries. Countries may appeal to the WTO’s dispute settlement mechanism (DSM) when they believe that another country’s laws infringe upon free trade. The dispute settlement system gives these countries the ability to seek a binding settlement to a trade dispute; one that forces the defending nation to compensate the plaintiff country, change its domestic laws in order to comply with the WTO’s decision, or risk trade retaliation.
There are a number of defined steps for members to follow when bringing a case before the WTO dispute settlement system. First, members in disagreement over a given issue are required to take part in consultations (up to 60 days). If consultations fail to remedy a dispute, the plaintiff state is entitled to request that a panel be established by the Dispute Settlement Body (DSB). The responding country has the right to refuse the appointment of the first panel assigned, however this is limited to the establishment of the first panel only. Technically, this could help a defendant to prolong a trade dispute (by 45 days or more). Once appointed, the panel generally has 60 days to produce a final report. Upon completion, the panel releases its findings to WTO members for review (3 weeks). Finally, the DSB has two months (60 days) to adopt or reject the panel’s report. The DSB generally accepts panel reports, but has the ability to reject panel finding if there is concurrence among the body. However, both members of a dispute have the ability to appeal panel findings. This prolongs the dispute settlement process, often for 3—4 months.
The defending nation is then legally bound to the recommendations of the panel or the report released by the appellate body. If the defendant does not respond to these recommendations in a reasonable time period, it is obligated to enter into negotiations in order to agree upon comparable concessions. If nothing is agreed upon in 20 days, the plaintiff may ask the DSB for the right to impose sanctions.
If the complaining nation is forced to consider further actions, the suspension of concessions is the first step necessary. This means that it may withdraw certain privileges it normally grants to the offending nation. If this method proves ineffective, the complaining country may choose to suspend concessions in other sectors under the same agreement. If this method should also prove ineffective, the complaining nation may have the right to suspend concessions in sectors of trade outside of the agreement.
Q: What are the environmental aspects of WTO?
Countries signing onto the WTO agreements, according to the preamble of the Agreement establishing the WTO (1995), recognize “that their relations in the field of trade and economic endeavor should be conducted with a view to raising standards of living, ensuring full employment and expanding the production of and trade in goods and services, while allowing for the optimal use of the world’s resources in accordance with the objective of sustainable development, seeking both to protect and preserve the environment and to enhance the means for doing so in a manner consistent with their respective needs and concerns at different levels of economic development.”
In addition to these general principles contained in the Preamble, the WTO regime seeks to promote a common set of international trade rules, a reduction in tariffs and other barriers to trade, and the elimination of discriminatory treatment in international trade relations. The WTO accomplishes many of these goals primarily through the use of “negative” obligations. The WTO is not a “supra” international environmental institution, nor is NWF advocating the transformation of the WTO into an overarching global environmental regime. In general, the WTO does not impose an affirmative requirement that members (and their domestic regulatory regimes) meet a minimum baseline standard of compliance with its goals. Additionally, the liberalized trade regime does not establish minimum benchmark levels for individual member protection of the environment and public health. Instead, the WTO seeks to distinguish national standards adopted for legitimate health and environment purposes from those regulatory standards enacted to promote protectionism. If a regulatory standard is deemed inconsistent with the WTQ, a “negative” obligation to remove or correct the offending measure is imposed on the member.
The core principles of the WTO are reflected in the original GATT 1947 text. Article I of GATT 1947 establishes the Most-Favored-Nation principle (MEN), and aims to ensure that each member grant any privilege or advantage it provides to a product from one member immediately and unconditionally to like products from, or destined for, all WTO members. MEN effectively requires all members to treat products from other members in the same manner Article III establishes the national treatment principle and requires members to treat any imported “like product” in the same manner as they would treat domestic “like products”. National treatment is designed to prevent the discrimination of imported products in order to secure market advantages for domestic products. Article XI establishes a prohibition on quantitative restrictions and seeks to prohibit such trade actions as quotas, embargoes, and licensing schemes on imported or exported products.
The WTO Agreement on Technical Barriers to Trade (TBT Agreement) seeks to ensure that the nondiscrimination and national treatment provisions of the WTO as a whole are specifically applied to the adoption of technical regulations by members. The TBT Agreement emphasizes deference to international standards in the creation of regulations governing many standards with implications for conservation and the environment, including, product characteristics, process and production methods labeling, and packaging.
The WTO Agreement on Sanitary and Phytosanitary Measures (SPS Agreement) seeks to ensure that domestic regulations governing human health, animal, and plant life are not applied in a protectionist manner. The SPS Agreement’s provisions require national regulations to meet specific trade-based obligations and encourage deference to international standards, harmonization of standards, and “equivalence” (accepting another country’s standards as our own). As a result, the WTO SPS agreement has direct and indirect implications for national environmental regulations addressing several areas, including, precautionary approaches to human health, invasive species, additives, and pesticides.
The WTO contains explicit articles that are supposed to allow countries to uphold strong measures for environmental protection while complying with the international trade rules outlined in the WTO Agreements. Specifically, Article XX of GATT is an important exception to trade rules which states that:
“Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where the same conditions prevail, or a disguised restriction on international trade, nothing in this Agreement shall be construed to prevent the adoption or enforcement by any Member of measures:
(b) necessary to protect human, animal or plant life or health; or
(g) relating to the conservation of exhaustible natural resources if such measures are made effective in conjunction with restrictions on domestic production or consumption.”
Many WTO member nations, including the United States, have resorted to Article XX when their environmental laws have been challenged by other nations through the WTO dispute settlement system. Yet oftentimes dispute resolution panels have interpreted Article XX so narrowly so as to prevent countries from using this exception.
Finally, the WTO has sought to address trade and environment concerns through its Committee on Trade and the Environment which serves to study the relationship between trade and the environment and make recommendations on any changes that may be required in WTO trade agreements. The committee is, however, severely limited in the sense that it has no formal link to ongoing WTO negotiations that may affect national and international environmental policy. For trade and environment issues, the committee recommends that disputes be settled by the mechanisms established from the corresponding environmental agreements. However, the committee also recommends that, unless the parties of the dispute are all bound to the same particular environmental agreement, disputes should be referred to the WTO’s dispute settlement system.
Reading aids and expressions：
1、The dispute settlement system gives these countries the ability to seek a binding settlement to a trade dispute; one that forces the defending nation to compensate the plaintiff country, change its domestic laws in order to comply with the WTO's decision, or risk trade retaliation.
在此句中
1、“The dispute settlement system gives these countries the ability to seek a binding settlement to a trade dispute”是主句，其中动词不定式“to seek a binding settlement to a trade dispute”作定语，修饰名词“ability”，另外，介词短语“to a trade dispute”作定语，修饰名词“settlement”
2、“one that forces the defending nation … trade retaliation”是同位语，对“settlement”进行补充说明，其中，“that forces the defending nation … trade retaliation”是限制性定语从句，修饰不定代词“one”；“to compensate the plaintiff country”“（to） change its domestic laws …”和“（to） risk trade retaliation”是三个动词不定式，作“forces”后宾语的补足语
2、Countries signing onto the WTO agreements, according to the preamble of the Agreement establishing the WTO （1995）, recognize “that their relations in the field of trade and economic endeavor should be conducted with a view to raising standards of living, ensuring full employment and expanding the production of and trade in goods and services, while allowing for the optimal use of the world's resources in accordance with the objective of sustainable development, （and） seeking both to protect and preserve the environment and to enhance the means for doing so in a manner consistent with their respective needs and concerns at different levels of economic development.”
此句比较长，其中
1）“Countries signing onto the WTO agreements, according to the preamble of the Agreement establishing the WTO （1995）, recognize”是主句，现在分词短语“signing onto the WTO agreements”修饰名词“countries”，作定语；介词短语“according to the preamble of the Agreement establishing the WTO （1995）”作状语，修饰动词“recognize”
2）“that their relations in the field … levels of economic development.” 是宾语从句，作“recognize”的宾语，其中
①“their relations in the field of trade and economic endeavor should be conducted”是主要部分
②介词短语“with a view to raising … economic development”作状语，修饰谓语动词“should be conducted”，三个动名词短语“raising standards of living”“ensuring full employment”和“expanding the production of and trade ．．．”作短语介词“with a view to”的宾语
③“while”引出的分词短语“while allowing for …（and） seeking both to … economic development”作状语，说明前面三个动名词短语发生的时间；介词短语“in accordance with the objective of sustainable development”修饰名词“use”，作定语；介词短语“in a manner consistent with their respective needs and concerns at different levels of economic development”修饰动词不定式“to protect and preserve the environment”和“to enhance the means for doing so”，作状语
3、The TBT Agreement emphasizes deference to international standards in the creation of regulations governing many standards with implications for conservation and the environment, including product characteristics, process and production methods, labeling and packaging.
此句虽长，但是个简单句，句中
1）“The TBT Agreement emphasizes deference to international standards”是主要部分
2）介词短语“in the creation of regulations”作定语，修饰名词“deference”；
3）现在分词短语“governing many standards”作定语，修饰名词“regulations”
4）介词短语“with implications for conservation and the environment, including product characteristics, process and production methods, labeling and packaging”修饰名词“regulations”
4、Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where the same conditions prevail, or a disguised restriction on international trade, nothing in this Agreement shall be construed to prevent the adoption or enforcement by any Member of measures …
在此句中
1）“nothing in this Agreement shall be construed to prevent the adoption or enforcement by any Member of measures …”是主句，动词不定式“to prevent the adoption or enforcement by any Member of measures …”作目的状语
2）介词短语“Subject to the … international trade”作状语，修饰谓语动词“shall be construed”，其中的“that such measures international trade”是同位语从句，说明“requirement”的内容，在同位语从句中：
①“which would constitute … international trade”是限制性定语从句，修饰名词“manner”，其谓语动词“would constitute”有两个宾语“a means of arbitrary or unjustifiable discrimination between countries”和“a disguised restriction on international trade”；
②定语从句“where the same conditions prevail”修饰名词“countries”
5、Finally, the WTO has sought to address trade and environment concerns through its Committee on trade and （the） Environment which serves to study the relationship between trade and the environment and make recommendations on any changes that may be required in WTO trade agreements.
在此句中
1）“Finally, the WTO has sought to address trade and environment concerns through its Committee on trade and （the） Environment”是主句，介词短语“through its Committee on trade and （the） Environment”作状语，修饰动词不定式“to address …”
2）限制性定语从句“which serves to … trade agreements”修饰名词“Committee on trade and （the） Environment”，其中的限制性定语从句“that may be required in WTO trade agreements”修饰名词“changes”
6、The committee is, however, severely limited in the sense that it has no formal link to ongoing WTO negotiations that may affect national and international environmental policy.
在此句中
1）“The committee is, however, severely limited in the sense”是主句
2）限制性定语从句“that it has no ．．．environmental policy”修饰名词“sense”，其中还有一个限制性定语从句“that may affect national and international environmental policy”，修饰名词“negotiations”
Questions：
- When was the World Trade Organization founded and when did it take effect?
- What functions does it play in international economic affairs?
- How many member nations does the World Trade Organization have?
- How often are the WTO Ministerial Meetings held and what is done at the meetings?
- What difference lies between the World Trade Organization and its predecessor, the General Agreement of Tariffs and Trade?
- What are the steps for members to follow when they lodge a complaint concerning non-compliance?
- How much time does the defending nation have to correct and comply with the rules and decisions, after the plaintiff state brings a case before the WTO dispute settlement body?
- What is the goal of establishing economic and trade relations between nations according to the Agreement creating the World Trade Organization?
- The WTO accomplishes many of these goals primarily through the use of “negative” obligations. What are “negative” obligations?
- What are some of the core WTO principles?
