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Ask for the Moon, Settle for the Stars: What is a Reasonable Period to Comply with WTO Awards?

  • PETROS C. MAVROIDIS (a1), NIALL MEAGHER (a2), THOMAS J. PRUSA (a3) and TATIANA YANGUAS (a2)

Abstract

The World Trade Organization (WTO) dispute settlement process allows a defending Member a ‘reasonable period of time’ (RPT) to implement any findings that its contested measures are inconsistent with WTO law. If agreement on this RPT cannot be reached, Article 21.3(c) of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) provides for the possibility of arbitration on the length of the RPT. The DSU provides limited guidelines on the RPT, stating only that it should not normally exceed 15 months. In practice, Arbitrators have developed the standard that the RPT should reflect the shortest possible period under the domestic legal system of the defending Member to make the changes necessary to comply with the WTO rulings. Our research confirms that in practice Arbitrators have determined this period by ‘splitting the difference’ approximately between the periods suggested by the complaining and defending Member. In addition, the process appears to reward defending Members that request an RPT that exceeds the 15-month guideline in Article 21.3(c).

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The views expressed in this article are the personal academic views of the authors, who are fully responsible for all opinions and errors herein.

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References

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Brewster, R. and Chilton, A. (2014), ‘Supplying Compliance: Why and When the United States Complies with WTO Rulings’, Yale Journal of International Law, 39(2): 201–24
Horn, H., Johannesson, L., and Mavroidis, P. C. (2011), ‘The WTO Dispute Settlement System 1995–2010: Some Descriptive Statistics’, Journal of World Trade, 45(6): 11071138.
Horn, H., Maggi, G., and Staiger, R. W. (2010), ‘Trade Agreements as Endogenously Incomplete Contracts’, American Economic Review, 100(1): 394419.
Keynes, J. M. (1920), The Economic Consequences of the Peace, New York, Harcourt, Brace & Howe.
Palmeter, D. N., Mavroidis, P. C., and Meagher, N. (2016), Dispute Settlement in the WTO, Practice and Procedure, 3rd edn, Cambridge: Cambridge University Press.
Peng, Shin-yi (2008), ‘How Much Time Is Reasonable – The Arbitral Decisions under Article 21.3(c) of the DSU’, Berkeley Journal of International Law, 26(1): 323351.
Wilkinson, I. (2001), The Hitchhiker's Guide to Negotiation, Washington, DC: AACC Press.

Ask for the Moon, Settle for the Stars: What is a Reasonable Period to Comply with WTO Awards?

  • PETROS C. MAVROIDIS (a1), NIALL MEAGHER (a2), THOMAS J. PRUSA (a3) and TATIANA YANGUAS (a2)

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