This chapter examines the operation and accomplishments of two understudied aspects of the World Trade Organization (WTO) dispute settlement system – the consultation process and the implementation results. After a brief summary of the operation of the WTO dispute settlement system – focusing on consultations and the implementation process – it examines in detail the results of consultations and the record on implementation. As part of that examination, it looks at proposals on consultations and implementation that have been made over the years in the ongoing dispute settlement reform negotiations.

Brief overview of the WTO dispute settlement process

An effective dispute settlement system is critical to the operation of the WTO. In the words of the Understanding on the Rules and Procedures Governing the Settlement of Disputes (DSU), it ‘is a central element in providing security and predictability to the multilateral trading system’. There are essentially four phases in the WTO dispute settlement process: consultations, the panel process, the appellate process and surveillance of implementation.

The first step in the process is consultations. A WTO Member may ask for consultations with another Member if the complaining Member believes that the other Member has violated a WTO agreement or otherwise nullified or impaired benefits accruing to it. The goal of the consultation stage is to enable the disputing parties to understand better the factual situation and the legal claims in respect of the dispute and to resolve the matter without further proceedings.