Dispute Settlement Mechanisms In Regional Trade Agreements

It was a great pleasure to participate in a symposium that honoured one of the giants of the World Trade Organization (WTO) Appellate Body, Professor Yasuhei Taniguchi. Professor Taniguchi was a prominent member of the Appellate Body from 2000 to 2007, during which he served in the department for twenty-one appeals, many of which focused on pioneering issues. In his honor, this article focuses on a topic that was a key element in the last dispute, where Professor Taniguchi was a member of the Appellate Body. This dispute concerned Brazil`s restrictions on imports of retreaded tyres and raised important questions about the relationship between regional trade agreements and WTO commitments. Free trade agreements create trade forums for closer and deeper integration between Member States, but their economic benefits can only be realised if they are applied faithfully. [i] In practice, MSDs can be divided into free trade agreements into three main groups: political or diplomatic settlement of disputes, systems based on a permanent tribunal and referral to an ad hoc arbitral tribunal. The political or diplomatic settlement of disputes means that disputes are settled through negotiations and agreements between the parties. A system based on a permanent court, such as the Court of Justice of the European Union, consists of a court composed of judges appointed for a fixed period and who decide on the dispute between the parties. Finally, in a system based on referral to an arbitration panel such as the WTO, a litigation panel is convened, the mandate being limited to that dispute. In this case, the body consults the written and oral arguments of the parties to the dispute, adopts a written decision applying the law of the trade agreement to the dispute, and then dissolves. [i] The decision on the nature of the DSM may be the most important question to be answered, as it affects the effectiveness, costs and independence of the DSM.

This article describes the most common types of dispute settlement mechanisms contained in SAAs and the problems that may arise from the overlap or conflict between these rta dispute settlement rules and the WTO Dispute Settlement Agreement. This article also looks at the recent case in which such a conflict alight afield – the Appellate Body report to Brazil Tyres. In the Brazil Tyres database, the Appellate Body examined Brazil`s import ban on used and retreaded tyres and Brazil`s exemption from that ban in order to implement a negative decision resulting from a decision of a rtA dispute settlement tribunal. . . .