14 March, 2018
Most members of the World Trade Organisation (WTO), including India have showed great unity on the face of a potential crisis. They have joined forces to beat the US action of disrupting the working of the dispute settlement body (
In fact a large group of countries are working out a strategy to opt for an alternative mechanism of dispute resolution, provided for in the WTO rules, which would allow them to have arbitration outside the DSB.
The group consists of countries like India, China, Australia, Canada, New Zealand, Argentina, Bolivia, Russia, Paraguay, Vietnam, the EU, Peru and Korea.
The rule being considered to get around the problem of inadequate number of judges at the DSB is Article 25 of the Dispute Settlement Undertaking, which offers an alternative means of dispute resolution contingent upon mutual agreement of the parties.
Under the dispensation, instead of approaching the DSB, the parties mutually agree on the procedures, including the selection of the arbitrators, and the judgment is enforceable in the same way as when adopted through Appellate Body reports.
WTO members who are eager to ensure that the dispute resolution system of the WTO does not get affected want to reach a mutual understanding amongst them on the use of this alternative mechanism permitted under Article 25. Once the understanding is reached disputes between members who are parts of the new understanding can be sorted out outside the DSB.
The 60 members who proposed to the DSB last month to start the process of appointing judges are all part of the group looking for an appropriate alternative mechanism. While resorting to Article 25 (arbitration outside the Appellate Body) will sort out part of the problem, the disputes involving the US might still stay unresolved.
Bu the US will certainly not agree to be part of an arbitration process that falls outside the DSB as it would defeat its very purpose of holding up selection of judges. Since the US is a part of many of the disputes, the countries party to such cases would not have access to the alternative mechanism to sort out their grievances.