Disputes settlement mechanisms - Dissertation Example

The World Trade Organisation (WTO) is significant in resolving international trade disputes.This Research work deals with the various Trade Dispute Settlement mechanisms adopted at the international level and concentrates upon their current status, with a special focus on the WTO mechanisms. The literature review analyses the effectiveness of the WTO trade dispute mechanism, in resolving international trade disputes. The main focus of this research pertains to the WTO dispute settlement mechanisms among nations.

This sort of research is important in order to assess and analyse the various dispute settlement mechanisms available to member nations, involved in disputes.The research approach adopted in this dissertation is the qualitative method. The findings from this research suggest that the dispute settlement mechanism of WTO is ineffective. The main conclusions drawn from this work are; power imbalance among members and non – binding nature of the decisions are some of the important reasons for ineffective dispute settlement mechanisms of WTO.

The dispute resolution system is influenced by power imbalances between the disputants, and this requires to be corrected. A major drawback with this dispute resolution system is the protracted nature of the process. This causes untold damage to a developing country engaged in litigation with a developed country. It would be in the fitness of things to reduce this time to a minimum. TABLE OF CONTENTS ABSTRACT 1 Chapter 1 3 Introduction 3 Overview of the Dispute Settlement Understanding 10 Chapter II 17 Methodology 17 Introduction 17 Purpose of the Study 17 Research Questions 18 Statement of the Problem 18 Organisation of the Study 18 Research Methodology 19 Chapter III 21 Literature Review 21 Case Law 52 Chapter IV 56 Discussion and Analysis 56 Chapter V 61 Conclusions and Recommendations 61 References 66 Books 66 Journal Articles 67 Case law 68 Websites 68 Other Sources 71 International Trade Disputes Settlement Mechanisms Chapter 1 Introduction The World Trade Organisation (WTO) plays an important role in global trade.

It resolves trade disputes and constitutes a forum for international trade negotiations. Furthermore, the WTO monitors international trade policies and regulates trade agreements between parties. Its secretariat is located in Geneva, Switzerland, and this organisation boasts of 153 nations as members, as on the 23rd of July 2008.1 WTO establishes a forum for trade related discussions and it supervises international trade policies and regulates trade agreements. Nearly a fourth of the disputes between the members of the WTO are settled by means of mediation and negotiation.

In order to address situations, wherein mediation and negotiation prove to be futile, the WTO introduced the Dispute Settlement Mechanism.2 The Regional Trade Agreements (RTAs) play an important role in international trade. This mechanism involves less time and expenditure, in comparison to the dispute settlement mechanism of GATT. 3 This principle was established under the Public International Law of the Charter of the United Nations.4 The RTAs do not permit a member to block the commencement of disputes, establishment of a panel or the adoption of a report by the panel.

The drafters of the RTA had included the more important aspects of the WTO’s Dispute Settlement Understanding. Although this dispute settlement mechanism had a number of advantages, the parties were found to be unwilling to resort to this mechanism. Instead, they resorted to the procedure under the WTO, as it adopted previous decisions under the concept of stare decisis. The precedence system ensures certainty in the decision making process, and there is no such practice under the RTA system.

Thus, the disputing parties exhibit a greater willingness to approach the WTO forum rather than that of the RTA.5 The disputing parties would prefer to have the option to appeal against the decision of the dispute resolution mechanism. This facility is not available under the RTA mechanism. In addition,