Published online by Cambridge University Press: 27 February 2017
This article provides a critical assessment of the corpus of law that the adjudicating bodies of the World Trade Organization (WTO)—the Appellate Body (AB) and panels—have used since the organization was established on January 1, 1995. After presenting a taxonomy of WTO law, I move to discern, and to provide a critical assessment of, the philosophy of the WTO adjudicating bodies, when called to interpret it. In discussing the law that WTO adjudicating bodies have used, I distinguish between sources of WTO law and interpretative elements. This distinction will be explicated in part I below. Part II provides a taxonomy of the sources of WTO law, and part III a taxonomy of the interpretative elements used to illuminate those sources. Part IV concludes.
* I would like to thank Pauline Lievre for endless discussions on this issue, and Eyal Benvenisti for excellent comments on a previous draft. This article is for David Palmeter.
1 The Dispute Settlement Body (DSB) is not an adjudicating body since it can only adopt or reject (as presented) the findings of panels or the Appellate Body (AB).
2 The cutoff date is July 31, 2007.
3 The term contract has no special connotation in this article. It is used as equivalent to “agreement,” “contractual arrangement,” or similar expressions.
4 There are two such bodies, as briefly alluded to above: panels, which are the “court” of first instance, and the AB, which hears appeals against panel reports. To be sure, the term courts is not used in the WTO agreements. Panels and the AB are usually referred to in literature as quasi-judicial bodies since adjudication in the WTO contains elements of diplomacy: bilateral consultations must precede the referral of a dispute to a panel. Once a dispute has been referred to a panel, however, the procedure is quintessentially judicial.
5 Article 3.2 of the WTO Dispute Settlement Understanding provides that the dispute settlement system “cannot add to or diminish the rights and obligations provided in the covered agreements.” See Understanding on Rules and Procedures Governing the Settlement of Disputes [hereinafter DSU], Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization [hereinafter WTO Agreement], Annex 2, in World Trade Organization, The Results of the Uruguay Round of Multilateral Trade Negotiations: The Legal Texts 354 (1999) [hereinafter The Legal Texts], 1869 UNTS 401, 33 ILM 1226 (1994). The scope of the powers entrusted on WTO courts is thus clearly delimited: the WTO members did not entrust them with powers beyond clarifying (interpreting) the covered agreements. WTO legal texts are available at <http://www.wto.org/english/docs_e/legal_e/legal_e.htm>.
6 The General Agreement on Tariffs and Trade, Oct. 30, 1947, TIAS No. 1700, 55 UNTS 194 [hereinafter GATT] (regulating trade in goods), the General Agreement on Trade in Services, Apr. 15,1994.WTO Agreement, supra note 5, Annex IB, in The Legal Texts, supra note 5, at 284, 1869 UNTS 183, reprinted in 33 ILM 1167 (1994) [hereinafter GATS] (trade in services), the Agreement on Trade-Related Aspects of Intellectual Property Rights, Apr. 15, 1994, WTO Agreement, supra note 5, Annex 1C, in The Legal Texts, supra note 5, at 320, 1869 UNTS 299, reprinted in 33 ILM 1197(1994) [hereinafter TRIPS Agreement] (regulating trade related intellectual property rights), and the DSU: these four agreements bind all WTO members. To those, the framers added the four plurilateral agreements that were in force on January 1, 1995, and that bind a subset of the WTO membership only (those that accepted to adhere to these arrangements). The WTO AB has, from early on, construed all of the multilateral coveted agreements as one agreement, that is, the WTO Agreement and its annexes.
7 The International Court of Justice (ICJ) is also limited in the cases that it may hear and may also be limited in the law that it can apply. Article 38(1) of the ICJ Statute, although it is taken as a statement of the sources of public international law, serves to define, in effect, the law applicable by the ICJ, at least insofar as the compromis providing the ICJ with authority in any particular adjudication does not specify a more limited universe of law. The article provides as follows:
1. The Court, whose function is to decide in accordance with international law such disputes as are submitted to it, shall apply:
a. international conventions, whether general or particular, establishing rules expressly recognized by the contesting states;
b. international custom, as evidence of a general practice accepted as law;
c. the general principles of law recognized by civilized nations;
d. subject to the provisions of Article 59, judicial decisions and the teachings of the most highly qualified publicists of the various nations, as subsidiary means for the determination of rules of law.
2. This provision shall not prejudice the power of the Court to decide a case ex aequo et bono, if the parties agree thereto.
Some voices in the literature suggest that the ICJ’s legislative will can still be further fine-tuned. Higgins, for example, has taken the view that there are two sources of public international law: treaty and custom. Rosalyn Higgins, Problems and Process: International Law and How We Use It (1994). She distances herself from the position that general principles of law are a source of law, arguing that a general principle of law serves the purpose of interpreting other sources of law rather than creating autonomous rights and obligations. This assertion is true for most principles, but there are some borderline cases. For example, estoppel, see infra notes 91–96 and accompanying text, is a general principle of law accepted as such across international jurisdictions. It is not, however, an interpretative source of law; rather, it conditions the right to exercise what would otherwise be one’s legal rights.
8 Supra note 6.
9 Havana Charter for an International Trade Organization, UN Doc. E/CONF.2/78 (Mar. 24, 1948).
10 Although a WTO panel has drawn on this provision, see infra note 32 and accompanying text, no panel has recognized it as source of specific rights and obligations.
11 To my knowledge, no right has ever been added to the sources of WTO law as a result of state practice. The panel on Mexico- Telecoms, see infra note 32 and accompanying text, used Article XXIX of the GATT to confirm a meaning that it had reached. It did not point to any state practice whereby a state was behaving in conformity with this provision because it felt compelled to do so.
12 Supra note 5.
13 WTO adjudicating bodies have never used this term, although, as we will see, they have made references to acts that could fall within its purview.
14 Wolfgang Benedek appears to have been the first to use the term secondary law to describe a series of consensus based decisions by the GATT contracting parties. See Wolfgang, Benedek, Das Gatt Aus Volkerrechtlicher Sicht (1990)Google Scholar. In the GATT, references to the “CONTRACTING PARTIES” (all in capitals) refers to the highest organ; the GATT “CONTRACTING PARTIES” decide, through joint action, all issues coming under the purview of the GATT. See GATT, supra note 6, Art. XXV.
15 The AB has used this authority; the latest version of the Working Procedures for Appellate Review, WTO Doc. WT/AB/WP/5, available at <http://www.wto.org/english/tratop_e/dispu_e/ab_e.htm>, was published in January 2005.
16 Lorand, Bartels, Applicable Law in WTO Dispute Settlement Proceedings , 3 5 J. World Trade 499 (2001)Google Scholar, was the first to make this point.
17 Appellate Body Report, United States—Measure Affecting Imports of Woven Wool Shirts and Blouses from India, WT/DS33/AB/R & corr.l (adopted May 23, 1997).
18 Gabrielle, Marceau, WTO Dispute Settlement and Human Rights , 13 Eur. J. Int’l L. 753 (2002)Google Scholar, makes a series of arguments in favor of this approach.
19 A panel might, for example, decide to have an extra internal meeting in light of disagreements among its members on a particular issue.
20 The judge should not exceed the boundaries established by DSU Article 11; that is, it should use its implied powers to ensure that its assessment is objective. It is true, however, that the boundaries are unclear.
21 Contracts may be incomplete for various reasons. It is difficult, for example, to foresee all future contingencies, and negotiators might feel that the contract will be best completed through renegotiation or adjudication. In particular, negotiators might feel that they have reached the point of diminishing returns in the negotiations, so that too much work will be required to achieve marginally better outcomes. At that point they will stop negotiating and leave it to subsequent negotiation or adjudication to fill the gaps. For a formal explanation, see Pierpaolo, Battigalli & Giovanni, Maggi, Rigidity, Discretion, and the Costs of Writing Contracts , 92 Am. Econ. Rev. 798 (2002)Google Scholar; see also Richard, A. Posner, Overcoming Law (1995)Google Scholar. For an application in the WTO context, see Joel, P. Trachtman, The Domain of WTO Dispute Resolution , 40 Harv. Int’l L.J. 333 (1999).Google Scholar
22 This point is not just a matter of semantics. When WTO members felt that WTO adjudicating bodies undid the balance of rights and obligations that they had negotiated, they reacted strongly. See Petros, C. Mavroidis, Amicus, Curiae Briefs Before the WTO: Much Ado About Nothing , in European Integration and International Co-ordination: Studies In Transnational Economic Law in Honour of Ciaus-Dieter Ehlermann 317 (von, Armin Bogdandy, C., Petros Mavroidis, & Yves, Meny eds., 2004)Google Scholar. Mavroidis reports on the WTO General Council’s special session that was dedicated to a discussion of whether to allow for amici to participate in WTO proceedings. During that session the majority of WTO members expressed the view that the AB was acting ultra vires in allowing amici to participate.
23 The DSB, see supra note 1, will not alter the findings of the panel or AB. It will decide to adopt or reject the findings of a panel/AB report submitted to it as such—that is, without being in a position to modify its findings.
24 May 23, 1969, 1155 UNTS 331.
25 See Trackman, supra note 21; Joel, P. Trachtman, Book Review, 98 AJIL 855 (2002)Google Scholar (reviewing Joost Pauwelyn, Conflict of Norms in Public International Law: How WTO Law Relates to Other Rules of International Law (2003)).
26 The agreements discussed here are not covered agreements, as they do not appear in Appendix 1 to the DSU.
27 See supra note 6.
28 See supra note 6.
29 The arrangement, at <http://www.imf.org/external/pubs/ft/eds/Eng/Guide/index.htm>, was concluded in 1978 and last revised in 1998.
30 The wording of this provision makes it plain that the OECD arrangement applies to the relationship across WTO members.
31 On this issue see David, Luff, Le Droit De l’Organisation Mondiale Du Commerce: Analyse Critique (2004).Google Scholar
32 Panel Report, Mexico—Measures Affecting Telecommunications Services, para. 7.236, WT/DS204/R (adopted June 1, 2004) [hereinafter Mexico—Telecoms]. The panel did not request that the defendant behave in a manner compatible with the Havana Charter; its findings were based on the GATS.
33 Panel Report, United States—Section 110(5) of the U.S. Copyright Act, para. 6.18, WT/DS160/R (adopted July 27, 2000) (emphasis added).
34 Panel Report, Brazil—Export Financing Programme for Aircraft (Second Recourse by Canada to Article 21.5 of the DSU), paras. 5.80–.91, WT/DS46/RW/2 (adopted Aug. 23, 2001).
35 The panel cannot be accused of overstepping its mandate. It is, however, remarkable that the WTO membership agreed in 1994 that a subset of the WTO membership (the OECD members) had the legal right to modify not only their inter se legal relations, but the rights and obligations of the totality of the WTO membership.
36 Panel Report, Canada—Patent Protection of Pharmaceutical Products, para. 7.70, WT/DS114/R (adopted Apr. 7, 2000) [hereinafter Canada—Pharmaceutical Patents].
37 This term, which is from the GATT (Article XXV), refers to the decision making by GATT contracting parties. The term is not formally used in the WTO Agreement; I use it to capture three acts by WTO members acting jointly: interpretations, amendments, and waivers.
38 In fact, in contrast to the process for seeking interpretations, the process for waivers does not require that one first look for a consensus. Practice reveals that when three-fourths of the members have cast a favorable vote, a waiver has been adopted. An interpretation, as a matter of legislative preference, should enjoy a higher degree of legitimacy for two reasons: by virtue of the higher value attached to the search for consensus, and also because an interpretation is good law for all WTO members, whereas a waiver is merely a temporary license to disobey the WTO Agreement.
39 The amendment reads as follows:
1. The Agreement on Trade-Related Aspects of Intellectual Property Rights (the “TRIPS Agreement”) shall, upon the entry into force of the Protocol pursuant to paragraph 4, be amended as set out in the Annex to this Protocol, by inserting Article 31 bis after Article 31 and by inserting the Annex to the TRIPS Agreement after Article 73.
2. Reservations may not be entered in respect of any of the provisions of this Protocol without the consent of the other Members.
3. This Protocol shall be open for acceptance by Members until 1 December 2007 or such later date as may be decided by the Ministerial Conference.
4. This Protocol shall enter into force in accordance with paragraph 3 of Article X of the WTO Agreement.
5. This Protocol shall be deposited with the Director-General of the World Trade Organization who shall promptly furnish to each Member a certified copy thereof and a notification of each acceptance thereof pursuant to paragraph 3.
6. This Protocol shall be registered in accordance with the provisions of Article 102 of the Charter of the United Nations.
General Council Decision, Amendment of the TRIPS Agreement, WTO Doc. WT/L/641, attachment (Dec. 8, 2005). Through the new Article 31 bis, WTO members, once the amendment has been formally adopted, could outsource production of goods coming under compulsory licensing. To be sure, the amendment has not (as of this writing) been formally adopted, which would require, under Article X:3 of the WTO Agreement, a vote of two thirds of the WTO members. The period for adoption runs out on December 31, 2009, see WTO Doc. WT/L/711 (Dec. 21, 2007). Until it has been adopted, a temporary waiver has been granted: already during the launching of the Doha Round, the Declaration on the TRIPS Agreement and Public Health, WTO Doc. WT/MIN(01)/DEC/2, para. 6 (Nov. 20, 2001), incorporated the idea that special care must be taken with respect to developing countries that cannot meet their public health objectives because of their obligations under TRIPS. The relevant provision was soon translated into operational language, and through a General Council decision adopted to this effect, WTO Doc. WT/L/540 & Corr. 1 (Sept. 2, 2003), WTO members accepted that the obligations under TRIPS Article 31(f) should be waived for developing countries. The decision roughly reproduces the idea included in the pending amendment. The waiver is temporary, however, and its renewal uncertain; legal security will come only with formal adoption of the amendment.
40 Panels and the AB clearly have no lawmaking power: they can only make recommendations to the DSB.
41 There is one exception: Article IX:4 of the WTO Agreement refers to the decision to grant a waiver.
42 A waiver affects, of course, not only the legal situation of the addressee, but also of the rest of the WTO membership—which can no longer enforce its rights against the beneficiary, at least to the extent that such enforcement would contradict the terms of the waiver granted. Even so, and unlike interpretations or amendments, waivers do not reflect a joint will to change the current legal regime; they serve as a means of satisfying concrete requests by particular WTO members.
43 Panel Report, EC—Regime for the Importation, Sale and Distribution of Bananas, WT/DS27/R (adopted Sept. 25, 1997), modified by Appellate Body Report, EC—Regime for the Importation, Sale and Distribution of Bananas, W T DS27/AB/R (adopted Sept. 25, 1997) [hereinafter EC—Bananas III].
44 The Lomé Conventions were aimed at promoting the economic, social, and cultural development of the contracting parties from Africa, the Caribbean, and the Pacific. The fourth such convention, 1991 O.J. (L 229) 3, which was revised in 1995, was signed in Lome on December 15, 1989.
45 Panel Report, EC—Bananas III, supra note 43, paras. 7.95–.97.
46 Appellate Body Report, EC—Bananas III, supra note 43, para. 169.
47 Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994, Apr. 15, 1994, WTO Agreement, supra note 5, Annex 1A, in The Legal Texts, supra note 5, at 168 [hereinafter AD Agreement].
48 See infra notes 49–53 and accompanying text.
49 Panel Report, India—Quantitative Restrictions on Imports of Agricultural, Textile and Industrial Products, paras. 5.93–94, WT/DS90/R (adopted Sept. 22, 1999); Appellate Body Report, India—Quantitative Restrictions on Imports of Agricultural, Textile and Industrial Products, WT/DS90/AB/R (adopted Sept. 22, 1999).
50 Panel Report, Mexico—Definitive Anti-dumping Measure on Rice, para. 7.62, WT/DS295/R (adopted Dec. 20,2005), modified by Appellate Body Report, Mexico—Definitive Anti-dumping Measure on Rice, WT/DS295/AB/R (adopted Dec. 20, 2005).
51 Panel Report, EC—Anti-dumping Duties on Malleable Cast Iron Tube or Pipe Fittings from Brazil, para. 7.321, WT/DS219/R (adopted Aug. 18, 2003), modified by Appellate Body Report, EC—Anti-dumping Duties on Malleable Cast Iron Tube or Pipe Fittings from Brazil, WT/DS219/AB/R (adopted Aug. 18,2003) [hereinafter EC—Pipe Fittings].
52 Panel Report, Argentina—Definitive Anti-dumping Duties on Poultry from Brazil, para. 7.287, WT/DS241/R (adopted May 19, 2003) [hereinafter Argentina—Poultry Anti-dumping Duties].
53 See WTO Doc. WT/L/28 (Feb. 7, 1996) (on file with author).
54 There is no official data, but only anecdotal evidence, that General Council meetings attract more delegates than committee meetings do.
55 Some might object, arguing that the quorum requirement is a thin reed to support a distinction with such far-reaching implications. Recall, nonetheless, that the heart of this argument concerns the expectations of WTO members in connection with introducing an issue in a lower, not higher, organ. Lower committees sometimes meet with only a few delegates present, with the consequence that the majority of delegations learn about their decisions much later.
56 Panel Report, Mexico—Telecoms, supra note 32, para. 7.236.
57 As briefly alluded to above, the Working Party on the Interaction of Trade and Competition Policies was not brought to a successful conclusion. Following the failure to agree in Cancun (midterm review of the Doha round), the WTO membership decided to discontinue its mandate. In the meantime, nevertheless, the working party managed to produce an impressive amount of work regarding the merits of competition policy as a complement to free trade policies.
58 See DSU, supra note 5, Art. 10. Essentially, WTO members can participate in the first panel meeting if they declare their wish to do so within the statutory deadlines.
59 Third parties do not enjoy this right. Id., App. 3, para. 6.
60 Essentially, the panel would first satisfy itself that a third party had an especially strong reason for continuing to participate in a given dispute. The question of enhanced third-party rights first arose in EC—Bananas III, when a number of developing-country third parties requested that they be permitted to attend all meetings between the panel and the parties to the dispute—and not simply the first meeting as per DSU Article 10.3. Panel Report, EC—Bananas III, supra note 43, para. 7.4. Given that the export revenue for numerous developing countries risked being heavily affected by the outcome of the dispute, the panel agreed to the request. Id., paras. 7.8,.9.
61 See Mavroidis, supra note 22, for a detailed account of the amici participation saga and the current conditions for participation.
62 See Bartels, supra note 16.
63 As per Article IV:2 of the WTO Agreement, the General Council can exercise the functions of the Ministerial Conference, the highest organ in the WTO institutional setting, when the latter does not meet.
64 General Council Decision, Agreements Between the WTO the IMF and the World Bank, WTO Doc. WT/L/195 (Nov. 18, 1996).
65 The legal basis for these agreements is Article 111:5 of the WTO Agreement.
66 35 ILM 754 (1996).
67 WTO Doc. WT/L/272 (July 8, 1998).
68 Panel Report, Argentina—Measures Affecting Imports of Footwear, Textiles, Apparel and Other Items, para. 72, WT/DS56/R (adopted Apr. 22, 1998), modified by Appellate Body Report, Argentina—Measures Affecting Imports of Footwear, Textiles, Apparel and Other Items, WT/DS56/AB/R (adopted Apr. 22, 1998).
69 Panel Report, Korea—Measures Affecting Government Procurement, para. 7.96, WT/DS163/R (adopted June 19, 2000) [hereinafter Korea—Procurement].
70 Through this instrument, trading nations might be compelled to compensate their (negatively) affected trading partners, even though they have committed no illegality. The leading example is compensation for (external negative) effects of subsidization: domestic subsidies are not illegal in the WTO legal order, but a nation that subsidizes, say, tomatoes after it has agreed to reduce its import duty on this product, is harming the foreign producer who might legitimately not have expected this subsidy. Compensation in such a case is necessary, not only in order to protect the bona fides trading partner who negotiated the 10 percent concession, but also because the system wants thus to ensure that the incentive to negotiate further trade liberalization will not be put into question by such (legal) acts.
71 See HIGGINS, supra note 7.
73 The current list of members and the dates that they joined the organization can be found at <http://www.wto.org/english/thewto_e/whatis_e/tif_e/org6_e.htm>.
74 General Assembly Resolution 56/83 adopted the International Law Commission’s Articles on the Responsibility of States for Internationally Wrongful Acts.
75 UN Convention on the Law of the Sea, opened for signature Dec. 10, 1982, 1833 UNTS 397, reprinted in 21 ILM 1261 (1982).
76 Arbitration Report, United States—Tax Treatment for “Foreign Sales Corporations,” Recourse by Article 22.6 of the DSU and Article 4.11 of the SCM Agreement by EC, WT/DS108/ARB (adopted Aug. 30,2002) [hereinafter U.S.—FSC].
77 Recall our discussion of HIGGINS, see supra note 7, and the point made there that general principles of law serve the purpose of interpreting other sources of law rather than creating autonomous rights and obligations. Admittedly, the arbitrator’s reference to the General Assembly resolution in U.S.—FSC is cryptic and could lend support to those taking the view that the reference to the resolution was in the context of VCLT Article 31; that is, the arbitrator considered the resolution to be a relevant rule of public international law, or context for the WTO Agreement, and for this reason recourse to it was compulsory. My own view, however, is that the majority of the references to the resolution simply confirm the conclusion that the arbitrator had already reached about the remedy to recommend in the case; that is, the arbitrator first decided (without reference to the resolution) what remedy to recommend, and then justified that choice by referring to the resolution. If anything, the resolution was used as a supplementary means of interpretation, as per VCLT Article 32.
78 Various jurisdictions around the world have repeatedly acknowledged the customary nature of the obligations contained therein.
79 The General Assembly resolution was passed after the DSU, so it could be argued that it is lex posterior to it. However, it only declares what seems to have been the customary standard for compensation for many years before the enactment of the DSU (see, for example, the judgment of the Permanent Court of International Justice judgment in Factory at Chorzów (Ger. v. Pol.), 1928 PCIJ (ser. A) No. 17 (Sept. 13). In this context, the DSU did not deviate from prior customary international law).
80 The linguistic differences between the two provisions suggest that damages will be calculated in a slightly more generous manner under the SCM Agreement. Both provisions stick to proportionality, however, and a footnote to SCM Article 4.10 explicitly states that no recourse to disproportionate countermeasures is permissible under that article. See Petros, C. Mavroidis, Remedies in the WTO Legal System: Between a Rock and a Hard Place , 11 Eur. J. Int’l L. 763 (2000).Google Scholar
81 Ernst-Ulrich, Petersmann, International Competition Rules for the GATT-MTO World Trade and Legal System , 35 J. World Trade 27 (1993).Google Scholar
82 Robert E. Hudec, Enforcing International Trade Law (1993). It is probably a quixotic test to try to explain why this practice has emerged, since so many explanatory variables are potentially at work. It seems to me, however, that the composition of panels is largely responsible. There are two important consequences of the selection process for the panelists, who were usually delegates in Geneva and agreed by the parties. First, they were likely to be sensitive to the parties own preferences and interests, and the parties generally have a common incentive not to “rock the boat” in view of the uncertainty as to who will commit illegalities in the future and potentially be subject to subject to retroactive damages. Second, since the panelists were not necessarily professional lawyers, they were not trained to think of remedies as involving an effort to restore the status quo ante. With regard to this latter point, there is a correlation between the establishment of a GATT legal office (with trained lawyers) (1982, in Hudec’s (1993) narrative, supra) and the beginning of recommendations for retroactive remedies.
83 With one exception only, panels and arbitrators (operating under DSU Article 22.6) alike have recommended prospective action. Regrettably so, I believe, on both doctrinal grounds, as mentioned here, and from a policy perspective since such remedies substantially undermine the incentive to comply. Having stated that, one should probably keep in mind that the AB has so far had no opportunity to pronounce on this score.
84 As noted above, if providing an incentive to comply is the paramount consideration, then remedies should be retroactive. In Punishments and Dispute Settlement in Trade Agreements (2001), at <http://www.econ.ku.dk/epru/files/wp/WEB-blaa-2001-l4.pdf> >Google Scholar, however, Wilfried Ethier has taken the view that, in light of the uncertainty as to who will be the winner in dispute adjudication, the common incentive of the membership is to opt for weak, rather than strong, remedies. This reinforces the point made above, see supra note 82, concerning the selection of panelists.
85 To avoid any misunderstandings, I am not describing here the law as it should be, but rather as it is.
86 Panel Report, EC—Measures Concerning Meat and Meat Products (Hormones), WT/DS26/R/USA (adopted Feb. 13, 1998), modified by Appellate Body Report, EC—Measures Concerning Meat and Meat Products (Hormones), paras. 120-25, WT/DS26/AB/R (adopted Feb. 13, 1998) (reported by David A. Wirth at 92 AJIL 755 (1998)) [hereinafter EC—Hormones].
87 See supra note 69 and accompanying text. It is difficult to state how much the WTO legal regime has missed out so far as a result of this attitude. In Customary International Law as a Judicial Tool for Promoting Efficiency , in The Impact of International Law on International Cooperation 85 (Eyal, Benvenisti & Moshe, Hirsch eds., 2004)Google Scholar, Eyal Benvenisti points to the possibility of using customary international law to promote more efficient equilibria among those participating. One important condition in his scheme however, concerns the role of the judge. Without advocating a judge akin to Dworkin’s Hercules, he, too, envisages a well-informed and alert judge. To my mind—and for institutional reasons, since panelists are ad hoc and AB members part-timers—much remains to be done in this context before we can reap similar benefits in the WTO. I will return to this issue later.
88 It was difficult to decide whether general principles of law should be treated here, under sources of law applicable in WTO adjudication, rather than in part III, where we discuss interpretative elements. Some of the general principles mentioned here do interpret the sources of law. For example, in dubio mitius amounts to a presumption that no sovereignty has been transferred when the letter of the law is unclear. But some general principles do not have this function. For example, estoppel and res judicata do not interpret rules of law; instead, they limit the competence of an adjudicating body to decide certain questions. It is the heterogeneity of general principles of law that persuaded me that they should be discussed here as a separate category of law applicable in WTO adjudication.
89 Panel Report, EC—Pipe Fittings, supra note 51, para. 7.292.
90 I understand that reference to “basic principles” is tantamount to general principles of law.
91 Panel Report, United States—Measures Affecting Imports of Softwood Lumber from Canada, paras. 308 – 2 5, SCM/162 (adopted Oct. 27, 1993).
92 Panel Report, Guatemala—Definitive Anti-dumping Measure on Grey Portland Cement from Mexico, paras. 823, 824 & n.791, WT7DS156/R (adopted Nov. 17, 2000).
93 To be sure, Guatemala was effectively arguing ne bis in idem. “Estoppel” is a different concept: it can be the consequence of ne bis in idem, but it is also relevant in circumstances other than ne bis in idem as well. For example, in the ICJ’s Nuclear Tests cases (Austl. v. Fr.; N.Z. v. Fr.), 1974 ICJ Rep. 253 & 457 (Dec. 20), estoppel is the consequence of a unilateral declaration to stop nuclear tests, and not of a prior court decision or arbitration.
94 Panel Report, Argentina—Poultry Anti-dumping Duties, supra note 52, paras. 7.37,.38.
95 Appellate Body Report, European Communities—Export Subsidies on Sugar, WT/DS265/AB/R, WT/DS266/AB/R, & WT/DS283/AB/R (adopted May 19,2005) [hereinafter EC—Export Subsidies on Sugar].
96 Note that in similar cases ICJ practice shows that unilateral declarations have been acknowledged the force of estoppel, thereby making it impossible for the declaring states to exercise the rights that they promised not exercise. See Legal Status of Eastern Greenland (Den. v. Nor), 1933 PCIJ Series A/B, no. 53, at 71 (Apr. 5) (discussing Ihlen Declaration); Nuclear Tests.
97 Panel Report, India—Measures Affecting the Automotive Sector, paras. 7.54-.66, WT/DS146/R, WT/DS175/R & corr.1 (adopted Apr. 5, 2002).
98 The difference between res judicata and estoppel is as follows: in the former, the forum is the same (in the original and the subsequent litigation), whereas in the latter, the forums are different, so that a country might be estopped from submitting a complaint before a particular forum because a different forum has already pronounced on the issue.
99 Panel Report, Korea—Procurement, supra note 69, paras. 7.123–.126.
100 April 15, 1994, WTO Agreement, supra note 5, Annex 4B, in The Legal Texts, supra note 5.
101 A word of caution is warranted here. This panel is idiosyncratic, an outlier: no other panel has shown so much deference toward customary law. The ad hoc selection process of panelists enables such outcomes. The assistance that the WTO secretariat provides to panels is a means of ensuring that such deviations from “orthodoxy” will not be frequent.
102 By virtue of this principle, a promisee can lawfully breach its promise if the promisor has neglected its own.
103 Panel Report, Argentina—Poultry Anti-dumping Duties, supra note 52, para. 7.79.
104 Panel Report, Korea—Procurement, supra note 69.
105 Panel Report, EC—Pipe Fittings, supra note 51, para. 7.307.
106 Appellate Body Report, United States—Continued Dumping and Subsidy Offset Act of 2000, para. 298, WT/DS217/AB/R, WT/DS234/AB/R (adopted Jan. 27, 2003) (reported by Mark, L. Movsesian at 98 AJIL 150 (2004 Google Scholar)) [hereinafter U.S.—Offset Act (Byrd Amendment)].
107 Appellate Body Report, EC—Hormones, supra note 86, paras. 154, 165.
108 Contrary to the ICJ, WTO adjudicating bodies cannot judge ex aequo et bono.
109 DSU Article 3.2 does not explicitly refer to the VCLT. The AB understood the reference to customary rules of interpretation to imply reference to VCLT.
110 Unless special terms of reference have been agreed between the parties—an infrequent occurrence. For an example, see Appellate Body Report, Brazil—Measures Affecting Desiccated Coconut, WTVDS22/AB/R (adopted Mar. 20, 1997).
111 Appellate Body Report, United States—Standards for Reformulated and Conventional Gasoline, at 15, WT/DS2/AB/R (adopted May 20, 1996) (reported by Maury, D. Shenk at 90 AJIL 669 (1996)Google Scholar) [hereinafter U.S.—Gasoline].
112 See, e.g., Panel Report, EC—Trade Description of Sardines, WT/DS231/AB/R (adopted Oct. 23, 2002), modified by Appellate Body Report, EC—Trade Description of Sardines, WT/D231/AB/R (adopted Oct. 23, 2002) [hereinafter EC—Sardines].
113 Appellate Body Report, U.S.—Gasoline, supra note 111, at 23.
114 Panel Report, Canada—Term of Patent Protection, para. 6.50, WT/DS170/R (adopted Oct. 12, 2000); Appellate Body Report, Canada—Term of Patent Protection, WT/DS170/AB/R (adopted Oct. 12, 2000).
115 For die same reason, the AB privileged the application of the Agreement on Technical Barriers to Trade (TBT Agreement), Apr. 15, 1994, WTO Agreement, supra note 5, Annex 1 A, in The Legal Texts, supra note 5, at 138, over the GATT in its EC—Asbestos and EC—Sardines jurisprudence. Appellate Body Report, EC—Measures Affecting Asbestos and Asbestos-Containing Products, WT/DS135/AB/R (adopted Apr. 5, 2001) (reported by David, A. Wirth at 96 AJIL 435 (2002)Google Scholar), modifying Panel Report, EC—Measures Affecting Asbestos and Asbestos-Containing Products, WT/DS135/R (adopted Apr. 5, 2001) [hereinafter EC—Asbestos]; Appellate Body Report, EC—Sardines, supra note 112. To be fair, no problem would exist at all if lex specialis was practiced only as a means of ordering the various provisions that would, in any event, be cumulatively examined. But that has not always happened. Earlier WTO panels adopted a very narrow view of the term conflict and also exercised judicial economy. A good recent example is the panel report on EC—Asbestos, which examined the consistency of the French measure only under GATT Article III:4 and not under the TBT Agreement. This approach could have been quite problematic had the measure at hand been nondiscriminatory but unnecessary: whereas GATT Article III:4 requires that domestic instruments be nondiscriminatory, the TBT Agreement requires that a subset of them (in particular, those coming under the purview of the TBT Agreement) be necessary (that is, that in terms of impact on trade transactions, they represent the least restrictive option reasonably available to the regulating state). In this context a nondiscriminatory, but unnecessary, measure would thus pass the test of legitimacy under GATT Article III:4. Starting the analysis from die lex specialis avoids such problems, even if all the potentially applicable provisions have not been cumulatively reviewed.
116 Appellate Body Report, United States—Import Prohibition of Certain Shrimp and Shrimp Products, para. 130, WT/DS58/AB/R (adopted Nov. 6, 1998) (reported by Gregory Shaffer at 93 AJIL 507 (1999)) [hereinafter U.S—Shrimp]. This report may be a unique instance of evolutionary interpretation in WTO dispute settlement.
117 This is not to suggest that GATT panels never used the VCLT. The creation of the Legal Affairs Division in the eighties in the GATT marked the turning point in this direction and the adoption of VCLT-friendly interpretations. See HUDEC, supra note 82. On the negotiating history of GATT Article XX(g), see Douglas, A. Irwin, Petros, C. Mavroidis, & Alan, O. Sykes, The Genesis of the Gatt (2008).Google Scholar
118 A notable counterexample is the panel proceedings in EC—Asbestos.
119 See Appellate Body Report, EC—Price Band System and Safeguard Measures Relating to Certain Agricultural Products, para. 271, WT/DS207/AB/R (adopted Oct. 23, 2002); Appellate Body Report, EC—Anti-dumping Duties on Imports of Cotton-Type Bed Linen from India, para. 123, WT/DS14/AB/R (adopted Mar. 12,2001).
120 Appellate Body Report, United States—Final Countervailing Duty Determination with Respect to Certain Softwood Lumber from Canada, para. 59, WT/DS257/AB/R (adopted Feb. 17, 2004) (reported by Chi Carmody at 100 AJIL 664 (2006)) [hereinafter U.S.—Softwood Lumber IV].
121 Appellate Body Report, EC—Conditions for the Granting of Tariff Preferences to Developing Countries, para. 147, WT/DS246/AB/R (adopted Apr. 20, 2004) [hereinafter EC—Tariff Preferences].
122 See Trachtman, supra note 21; David, Palmeter & Petros, C. Mavroidis, Dispute Settlement in the World Trade Organization: Practice and Procedure (2004)Google Scholar. Wittgenstein, unfortunately, was never an AB member.
123 Eduardo Jiménez de, Aréchaga, International Law in the Past Third of a Century , 159 Recueil Des Cours 1 (1978-I).Google Scholar
124 There have been a number of papers criticizing the (often) exaggerated textualism to which the WTO adjudicating bodies adhere. None, to my mind, has done so as eloquently as Henrik, Horn & H., Joseph H. Weiler, European Communities—Measures Affecting Asbestos and Asbestos-Containing Products , in The WTO Case-Law of 2001, at 14 (Henrik, Horn & Petros, C. Mavroidis eds., 2004).Google Scholar
125 And into other relevant documents, as explained below, see infra notes 130–46 and accompanying text.
126 Contrary to ideological interpretation, which typically asks the first question, contextual interpretation does not risk imposing obligations on WTO members that the framers did not envisage in the first place. Jiminez de Arechaga, see supra note 123, explains persuasively why it was felt by the VCLT’s drafters that teleological interpretations should be avoided. See also infra note 146 and accompanying text.
127 There are various examples where, following acontextual interpretations, the AB ended up imposing obligations that were, in all likelihood, not envisaged by the framers. Two prominent examples are the benchmark for calculating benefits in SCM Article 14, as discussed in U.S.—Softwood Lumber IV, supra note 120, and the discipline on export credits under Article 10 of the Agreement on Agriculture, as discussed in U.S.—Upland Cotton, see infra notes 161– 62 and accompanying text. Petros, C. Mavroidis, Legal Eagles? A Look into 10 Years of AB Case-Law (Discussion Paper No. 49, APEC Study Center, Columbia University) (2007)Google Scholar. McRae has advanced additional arguments in favor of contextual interpretations. Donald, McRae, The WTO in International Law: Tradition Continued or New Frontier? 3 J. Int’l Econ. L. 27 (2000).Google ScholarPubMed
128 Appellate Body Report, United States—Measures Affecting the Cross-border Supply of Gambling and Betting Services, para. 166, WT/DS285/AB/R & corr. 1 (adopted Apr. 20, 2005) (reported by Joel P. Trachtman at 99 AJIL 861 (2005)) [hereinafter U.S.—Gambling].
129 This is so because the WTO judge is typically not in doubt as to the meaning of a term following an evaluation of the ordinary meaning of the terms. The WTO judge will consequently not have to search actively for references to support the conclusion reached.
130 Convention on International Trade in Endangered Species of Wild Fauna and Flora, Mar. 3, 1973, 993 UNTS 243, 12 ILM 1085 (1973).
131 Quoting from Jiménez de Aréchaga, supra note 123, at 165:
It is important to remark that “the object and purpose of the treaty” is mentioned not as an independent element as in the Harvard Draft Convention but at the end of paragraph 1. This was done deliberately, in order to make clear that “object and purpose” are part of the context, the most important one, but not an autonomous element in interpretation, independent of and on the same level as the text, as is advocated by the partisans of the teleological method of interpretation.
132 Appellate Body Report, U.S.—Shrimp, supra note 116, para. 114. There can be no dispute that a hierarchy exists between VCLT Articles 31 and 32 since the latter makes explicit that recourse to the supplementary means of interpretation is available only in accordance with the conditions it states. See section below on Supplementary Means.
133 This passage from the Appellate Body report in U.S.—Shrimp was cited in the panel report on EC—Chicken Cuts as evidence of the hierarchy among the various interpretative elements laid down in VCLT Article 31. Panel Report, EC—Customs Classification of Frozen Boneless Chicken Cuts, para. 7.92, WT/DS269/R, WT/DS269/R (adopted Sept. 27, 2005), modified by Appellate Body Report, EC—Customs Classification of Frozen Boneless Chicken Cuts, WT/DS269/AB/R, WT/DS286/AB/R (adopted Sept. 27, 2005) [hereinafter EC—Chicken Cuts].
134 For example, VCLT Article 32 refers to supplementary means of interpretation, including preparatory work. We do not know what else is intended.
135 Appellate Body Report, Korea—Definitive Safeguard Measure on Imports of Certain Dairy Products, para. 98, WT/DS98/AB/R (adopted Jan. 12, 2000).
136 Appellate Body Report, Chile—Price Band System and Safeguard Measures Relating to Certain Agricultural Products, WT/DS207/AB/R & corr.1 (adopted Oct. 23, 2002).
137 Humphrey Waldock, Humphrey, Special Rapporteur, Second Report on the Law of Treaties, UN Doc. A/CN.4/156 (1963), reprinted in  2 Y.B. Int’l L. Comm’n 36.
138 Pauwelyn, supra note 72.
139 Pieter, Kuijper, The Law of the GATT as a Special Field of International Law: Ignorance, Further Refinement or Self-Contained System of International Law? Netherlands Y.B. Int’l L. 227.Google Scholar
140 Trachtman, supra note 21; Trachtman, supra note 25.
141 Robert, Howse, The Appellate Body Rulings in the Shrimp/Turtle Case: A New Legal Baseline for the Trade and Environmental Debate , 27 Colum. J. Envtl. L. 491 (2002).Google Scholar
142 Panel Report, EC—Chicken Cuts, supra note 133, paras. 7.190–.241; Appellate Body Report, EC—Chicken Cuts, supra note 133, para. 199.
143 International Convention on the Harmonized Commodity Description and Coding System, June 14, 1983, 1035 UNTS 3.
144 Appellate Body Report, EC—Customs Classification of Certain Computer Equipment, para. 89, WT/DS62/AB/R, WT/DS67/AB/R, WT/DS68/AB/R (adopted June 22, 1998) [hereinafter EC—Computer Equipment].
145 On the issue of interpretation of schedules, see Van, Isabelle Damme, The Interpretation of Schedules of Commitments , 41 J. World Trade 1 (2007).Google Scholar
146 See, for example, the AB report in EC—Chicken Cuts, supra note 133, paras. 236–38.
147 Panel Report, Mexico—Telecoms, supra note 32, paras. 7.129–.136.
148 Appellate Body Report, Japan—Taxes on Alcoholic Beverages, at 12, WT/DS8/AB/R, WT/DS10/AB/R, WT/DS11/AB/R (adopted Nov. 1, 1996), modifying Panel Report, Japan—Taxes on Alcoholic Beverages, WT/DS8/R.WT/DS10/R, WT/DS11/R (adopted Nov. 1, 1996) [hereinafter Japan—Alcoholic Beverages II].
149 Appellate Body Report, U.S.—Gambling, supra note 128, para. 192.
150 Appellate Body Report, EC—Computer Equipment, supra note 144, para. 90.
151 Panel Report, EC—Chicken Cuts, supra note 133, para. 7.289.
152 Appellate Body Report, EC—Chicken Cuts, supra note 133, para. 259.
153 Id, para. 266.
154 Id., paras. 195–200. Moreover, as argued above, the HS treaty has been acknowledged as legal context for the WTO Agreement anyway.
155 Panel Report, Mexico—Telecoms, supra note 32, paras. 7.108–.117.
156 This memorandum is an understanding reached at the end of the negotiations and reflected in paragraph 7 of the Report of the Group on Basic Telecommunications, WTO doc. S/GBT/4 (Feb. 15, 1997). The understanding was later confirmed (taken note of) by the Council for Trade in Services, in paragraph 8 of the Report to the General Council on Activities During 1997, WTO Doc. S/C/5 (Nov. 28, 1997).
157 Although in United States—Gasoline, supra note 111, the AB had already clarified that the VCLT system codifies the customary rules of interpretation, through this ruling in Japan—Alcoholic Beverages II, supra note 148, it makes clear that its prior ruling covers not only VCLT Article 31, but also Article 32.
158 Appellate Body Report, Japan—Alcoholic Beverages II, supra note 148, at 9.
159 Panel Report, India—Quantitative Restrictions on Imports of Agricultural, Textile and Industrial Products, para. 5.110, WT/DS90/R (adopted Sept. 22, 1999); Appellate Body Report, India—Quantitative Restrictions on Imports of Agricultural, Textile and Industrial Products, WT/DS90/AB/R (adopted Sept. 22, 1999).
160 Panel Report, Canada—Pharmaceutical Products, supra note 36, para. 7.47.
161 Appellate Body Report, United States—Subsidies on Upland Cotton, WT/DS267/AB/R, paras. 623–27 (adopted Mar. 21, 2005) (reported by Richard, H. Steinberg at 99 AJIL 852 (2005)Google Scholar) [hereinafter U.S.—Upland Cotton].
162 Interestingly, in a separate opinion (at paragraphs 631–41), one member of the AB checking the same negotiating history reached the opposite conclusion—namely, that export credits are not covered by the existing disciplines. It should be noted, however, that even this member of the AB fell short of stating that recourse to preparatory work was strictly necessary under the circumstances.
163 Panel Report, Canada—Pharmaceutical Patents, supra note 36, para. 7.29.
164 Panel Report, Korea—Procurement, supra note 69, paras. 7.74–83.
165 Appellate Body Report, Canada—Measures Affecting the Importation of Milk and the Exportation of Dairy Products, para. 138, WT/DS103/AB/R, WT/DS113/AB/R (adopted Oct. 27, 1999) [hereinafter Canada-Dairy].
166 Nevertheless, one cannot help thinking whether, and to what extent, the VCLT is the best tool for discussing the scope of contractual elements. Some of its elements (such as text, context) seem appropriate, whereas others (such as relevant rules of public international law) seem far less so. Technically, all schedules of concessions are annexes to the WTO Agreement and are therefore, by virtue of DSU Article 3.2, subject to interpretation through the VCLT. A strong argument can be made, however, in support of the contrary position. When trading partners make a promise to each other, they are laying out the foundation on which a treaty will eventually be founded and not the other way round. The VCLT is probably the last thing that negotiators have in mind when exchanging concessions.
It seems that in this particular context, evidence sought through what is called “circumstances surrounding the conclusion of a negotiation” in VCLT Article 32 should probably take precedence over any other interpretative elements. Unfortunately, the recent case law of the AB, when called to interpret the scope of commitments, leaves much to be desired in terms of faithfully reproducing the balance of rights and obligations as struck by the negotiating partners. See, for example, the Appellate Body reports in U.S.—Upland Cotton, supra note 161, EC—Export Subsidies on Sugar, supra note 95, and U.S.—Gambling, supra note 128, as well as the panel report in Mexico—Telecoms, supra note 32.
167 Appellate Body Report, U.S.—Gambling, supra note 128, paras. 197–212.
168 Panel Report, United States—Preliminary Determinations with Respect to Certain Softwood Lumber from Canada, para. 7.26, WT/DS236/R (adopted Nov. 1, 2002) (reported by Chi Carmody at 100 AJIL 664 (2006)).
169 Appellate Body Report, United States—Countervailing Duties on Certain Corrosion-Resistant Carbon Steel Flat Products from Germany, para. 90 n.83, WT/DS213/AB/R & corr.1 (adopted Dec. 19, 2002).
170 Modalities for the Establishment of Specific Binding Commitments Under the Reform Programme, GATT Doc. MTN.GNG/MA/W/24 (Dec. 20, 1993).
171 Nevertheless, reading carefully paragraphs 138 to 157 of the AB’s report in Canada—Dairy, supra note 165, one may well be left with the impression that AB took the Modalities Paper into account on the way to its finding about the ambit of Canada’s commitment.
172 Appellate Body Report, EC—Bananas III, supra note 43, para. 157.
173 Appellate Body Report, EC—Export Subsidies on Sugar, supra note 95, para. 199.
174 The central question, of course, was whether the Modalities Paper could have served as a supplementary means of interpretation.
175 Panel Report, Mexico—Telecoms, supra note 32, paras. 7.43—.44.
176 Appellate Body Report, U.S.—Gambling, supra note 128, paras. 196, 204.
177 Appellate Body Report, EC—Export Subsidies on Sugar, supra note 95, para. 199.
178 Panel Report, EC—Measures Affecting Importation of Certain Poultry Products, para. 202, WT/DS69/R (adopted July 23, 1998) (emphasis added), modified by Appellate Body Report, EC—Measures Affecting Importation of Certain Poultry Products, paras. 83–85, WT/DS69/AB/R (adopted July 23, 1998).
179 Canada/European Communities Article XXVIII Rights, GATT B.I.S.D. (37th Supp.) at 80, 84 (1990).
180 See supra note 178 and accompanying text.
181 Panel Report, EC—Measures Affecting Trade in Commercial Vessels, paras. 7.130–.132, WT/DS301/R (adopted June 20, 2005).
182 Appellate Body Report, Canada—Dairy, supra note 165, para. 139.
183 The AB has never shown such a spirit to accommodate contractual promises in subsequent case law. Moreover, as indicated above, it is highly debatable (if not wrong altogether) that a promise was actually given. The United States contested, and the AB effectively accepted its position, that no agreement between the two partners was ever concluded. Moreover, although the AB stated that it would look at the circumstances surrounding the negotiations, its examination was limited to the submissions to the panel (over ten years later).
184 Appellate Body Report, EC—Computer Equipment, supra note 144, paras. 92, 95.
185 Panel Report, EC—Chicken Cuts, supra note 133, para. 7.392; Appellate Body Report, supra note 133, paras. 310–45.
186 According to this provision, decisions by the GATT contracting parties are part of the GATT 1994, the legal instrument that succeeded GATT 1947 (the original GATT).
187 Panel Report, Japan—Alcoholic Beverages II, supra note 148, para. 6.10; Appellate Body Report, Japan—Alcoholic Beverages II, supra note 148, at 15.
188 Panel Report, United States—Tax Treatment for “Foreign Sales Corporations,” WT/DS108/R (adopted Mar. 20, 2000); Appellate Body Report, United States—Tax Treatment for “Foreign Sales Corporations,” para. 115, WT/DS108/AB/R (adopted Mar. 20, 2000) (reported by Stanley, L. Langbein at 94 AJIL 546 (2000)Google Scholar).
189 Jackson, looking into the case law of the prior forty years, concludes that GATT panel reports have persuasive power over subsequent panels dealing with the same issue. John H. Jackson, The World Trading System: Law and Policy of International Economic Relations (1989). Jackson’s description is probably the closest we can get to an accurate picture of their legal status: their impact is not guaranteed since there is nothing like stare decisis in the GATT/WTO legal order; it depends on whether the subsequent panel is persuaded by the reasoning included in the prior panel’s findings.
190 Panel Report, Korea—Measures Affecting Trade in Commercial Vessels, paras. 7.591–.602, WT/DS273/R (adopted Apr. 11,2005).
191 Panel Report, Japan—Alcoholic Beverages II, supra note 148, para. 6.10; Appellate Body Report, Japan—Alcoholic Beverages II, supra note 148, at 16.
192 Panel Report, United States—Safeguard Measures on Imports of Fresh, Chilled or Frozen Lamb Meat from New Zealand and Australia, para. 7.78, WT/DS177/R, WT/DS178/R (adopted May 16, 2001), modified by Appellate Body Report, United States—Safeguard Measures on Imports of Fresh, Chilled or Frozen Lamb Meat from New Zealand and Australia, WT/DS177/AB/R, WT/DS178/AB/R (adopted May 16, 2001).
193 Panel Report, EC—Pipe Fittings, supra note 51, para. 7.280.
194 Japan—Alcoholic Beverages III, supra note 148, at 13 n.30.
195 Appellate Body Report, United States—Import Prohibition of Certain Shrimp and Shrimp Products, Recourse by Article 21.5 of the DSU by Malaysia, para. 109, WT/DS58/AB/RW (adopted Nov. 21, 2001) (reported by Louise de La Fayette at 96 AJIL 685 (2002)) [hereinafter U.S.—Shrimp (Article 21.5—Malaysia)].
196 Appellate Body Report, United States—Definitive Safeguard Measures on Imports of Circular Welded Carbon Quality Line Pipe from Korea, para. 102, WT/DS202/AB/R (adopted Mar. 8, 2002).
197 Appellate Body Report, EC—Sardines, supra note 112, paras. 155–62.
198 For one such example, see the panel reports in EC—Countervailing Measures on Dynamic Random Access Memory Chips from Korea, WT7DS299/R (adopted Aug. 3,2005), and United States—Countervailing Duty Investigation on Dynamic Random Access Memory Semiconductors (DRAMS) from Korea, WT/DS296/R (adopted July 20,2005). The EC and United States countervailed Korea’s alleged subsidization of Korean companies. Korea complained against both measures, presented identical claims and arguments to the two panels, but lost in one case (versus the EC) and prevailed in the other (versus the United States).
199 Panel Report, Argentina—Definitive Safeguard Measure on Imports of Preserved Peaches, para. 7.24, WT/DS238/R (adopted Apr. 15, 2003). More recently, a couple of panels dealing with the practice of zeroing (in which an investigating authority will not compute in the calculation of dumping margin transactions where no dumping has been found) have explicitly stated their disagreements with the AB’s condemnation of the practice. See, for example, the panel report in United States—Measures Relating to Zeroing and Sunset Reviews, WT/DS322/R (adopted Jan. 23, 2007), and its findings at pages 138–77, 182–90, and 192–94.
200 Since the losing party might have the incentive to appeal and to request from the AB that it reverse the panel’s findings, thereby reaffirming its own case law.
201 Panel Report, India—Patent Protection for Pharmaceutical and Agricultural Chemical Products, para. 7.30, WT/DS79/R (adopted Sept. 22, 1998).
202 One good example can be seen in United States—Countervailing Measures Concerning Certain Products from the European Communities, WT/DS212/AB/R (adopted Jan. 8, 2003), and the United States—Imposition of Countervailing Duties on Certain Hot-Rolled Lead and Bismuth Carbon Steel Products Originating in the United Kingdom, WT/DS138/AB/R (adopted June 7, 2000). As Grossman and Mavroidis explain, the second time that the AB dealt with the same issue (does the price paid matter when previously subsidized operations are being auctioned off?), it reached the opposite conclusion than the first time. The first time it ruled that a market price paid at auction always extinguishes the benefits previously received, and the second that that is not necessarily the case. Remarkably the subsequent report cites the previous one to support its conclusions. Gene, M. Grossman & Petros, C. Mavroidis, Recurring Misunderstanding of Nonrecurring Subsidies , in The WTO Case-Law of 2002, at 78 (Henrik, Horn & Petros, C. Mavroidis eds., 2005).Google Scholar
203 On this score, see POSNER, supra note 21.
204 As noted above, however, the WTO adjudicating body in question made no explicit reference to VCLT Article 32.
205 Panel Report, Argentina—Poultry Anti-dumping Duties, supra note 52, para. 7.358.
206 Arbitration Report, United States—Tax Treatment for “Foreign Sales Corporations,” Recourse to Arbitration by the United States under Article 22.6 of the DSU and Article 4.11 of the SCM Agreement, WT/DS108/ARB (adopted Aug. 30, 2002).
207 Panel Report, Mexico—Telecoms, supra note 32, para. 7.236.
208 Appellate Body Report, India—Patent Protection for Pharmaceutical and Agricultural Chemical Products, para. 65, WT/DS50/AB/R (adopted Jan. 16, 1998).
209 Panel Report, Argentina—Poultry Anti-dumping Duties, supra note 52, para. 7.108.
210 Panel Report, EC—Conditions for die Granting of Tariff Preferences to Developing Countries, para. 7.11, WT/DS246/R (adopted Apr. 20, 2004), modified by Appellate Body Report, EC—Conditions for the Granting of Tariff Preferences to Developing Countries, WT/DS/246/AB/R (adopted Apr. 20, 2004).
211 In U.S.—Shrimp, supra note 116, para. 114, for example, the AB cited Ian Sinclair in support of its position that recourse to VCLT Article 32 was warranted in order to confirm a conclusion it sought or to determine the meaning of a provision that remained uncertain after exhausting all references included in VCLT Article 31.
212 Id.; Appellate Body Report, U.S.—Shrimp (Article 21.5—Malaysia), supra note 195.
213 Appellate Body Report, U.S.—Shrimp (Article 21.5—Malaysia), supra note 195, paras. 124, 130.
214 Appellate Body Report, EC—Asbestos, supra note 115, paras. 114, 135.
215 Recall the central argument of the present article that context should be the dominant element. We will return to it shortly.
216 Recall our discussion concerning the boundaries between supplementary means and context: the list provides only two examples, with the consequence that the former category is indeterminate, and numerous elements could just as easily fall under one category or the other—albeit with extremely different legal consequences.
217 Appellate Body Report, EC—Tariff Preferences, supra note 121.
218 Recall that the AB condemned the EC practice only because the list appearing in its Generalized System of Preferences was closed. Had it been open, the AB would have admitted it, assuming that the AB considered the selection criteria objective.
219 Differential and More Favourable Treatment, Reciprocity and Fuller Participation of Developing Countries, GATT B.I.S.D. (26th Supp.) at 203 (1979).
220 Appellate Body Report, U.S.—Offset Act (Byrd Amendment), supra note 106.
221 Henrik, Horn & Petros, C. Mavroidis, United States—Continued Dumping and Subsidy Offset Act of 2000 , in The WTO Case-Law of 2003, at 52 (Henrik, Horn & Petros, C. Mavroidis eds., 2006).Google Scholar
222 Appellate Body Report, Chile—Taxes on Alcoholic Beverages, WT/DS87/AB/R, WT/DS110/AB/R (adopted Jan. 12, 2000).
223 See the excellent analysis in Lothar, Ehring, De Facto Discrimination in World Trade Law: National and Most Favoured Nation Treatment—or Equal Treatment , 36 J. World Trade 921 (2002)Google Scholar. The affection for textualism is especially noticeable in the safeguards case law, where the AB has based some of its conclusions on the very thinnest of distinctions: it held, for example, that unforeseen developments should be distinguished from unforeseeable developments, without explaining where the difference lies, and that significant injury is not insignificant injury, again without explaining what the two terms mean. See Alan, O. Sykes, The Safeguards Mess: A Critique of WTO Jurisprudence , 2 World Trade Rev. 261 (2003)Google Scholar. This extreme textualism is not, however, confined to safeguards case law. As Trebilcock and Soloway show, the AB has distinguished science from nonscience in the SPS case law without explaining what the distinguishing criteria are. Michael, Trebilcock & Julie, Soloway, International Trade Policy and Domestic Food Safety Regulation: The Case for Substantial Deference by the WTO Dispute Settlement Body Under the SPS Agreement , in The Political Economy of International Trade Law 537 (M., Daniel L. Kennedy & James, D. Southwick eds., 2002).Google Scholar
224 Supra note 116.
225 See, for example, UN Doc. E/PC/T/C.II/50, at 5ff (Nov. 13, 1946), a document from the London Conference. There negotiators were discussing, inter alia, the ambit of Article 37 of the London Draft, which became GATT Article XX. The remarks of the Indian delegate (Ganguli), along with the reactions to them, lend support to the argument that negotiators saw GATT Article XX(g) as protecting nonliving resources, whereas the protection of living organisms was the domain of GATT Article XX(b) (which, of course, is associated with a more stringent legal test for compliance). As Steve, Charnovitz notes in Exploring the Environmental Exceptions in GATT Article XX , 25 J. World Trade 37 (1991)Google Scholar, in parallel negotiation concerning an international commodity agreement (fisheries and wildlife), the same term, exhaustible natural resources, was used to cover both living and nonliving organisms. A remark by the chairman of the working group discussing the commodity agreement (Wyndham- White)—to the effect that the term appearing in GATT Article XX (g) covered fisheries as well— does lend to confusion. Nevertheless, an examination of the history discloses that the term exhaustible natural resources covered nonliving resources only. For a start, the discussion about fisheries was within a different context—namely, that of a commodity agreement that would come under the ITO, not the GATT itself. Moreover, subsequent discussions during the Havana Conference confirm that negotiators treated fisheries and wildlife as a special case. For this last point, see UN Docs. E.CONF.2/C.5/9, at 21(1947), and E.CONF.2/C.5/SR.7, at 2 (1947).
226 See supra note 170 and accompanying text.
227 Panel Report, EC—Measures Affecting the Approval and Marketing of Biotech Products, WT/DS291/R, WT/DS292/R, WT/DS293/R, corr.1 & adds.1–9 (adopted Nov. 21, 2006) (reported by Simon Lester at 101 AJIL 453 (2007)).
228 See Appellate Body Report, U.S.—Gasoline, supra note 111, and accompanying text.
229 CITES could thus help the judge to reach a better view of the criteria for classifying a species as endangered or resources as exhaustible. And instead of guessing what should and not be so classified, the judge could cite—in support of his or her decision—a convention representing today’s most sophisticated understanding of those terms.
230 Recall that in EC—Chicken Cuts, supra note 133, the AB held that the H S treaty is part of the WTO’s context. So far, nothing else has been so classified in WTO case law, but it remains unclear why even the HS treaty should be considered context. The AB states in paragraph 197 of its report that the HS treaty is context, in paragraph 198 that it is context because the Agreement on Agriculture refers to it (without explaining what to make of the absence of any reference to the HS treaty in the GATT, which regulates all nonagricultural products), and in paragraph 199 that it is context because of broad consensus among WTO members to use it when scheduling. Absent further information on the rationale for treating a legal document as context, we simply cannot predict what else could be so understood.
231 See supra note 21.
232 Claude, Barfield, Free Trade, Sovereignty, Democracy: The Future of the World Trade Organization (2001).Google Scholar
233 See supra note 39 and accompanying text.
234 See supra text accompanying notes 47–55.
235 There is consequently no need even to enter the (ongoing) discussion on fragmentation of public international law.
236 The influence of the WTO secretariat, the only inflexible element in panel formation, is difficult to ascertain. There are reasons to believe, however, that it accepts the current state of affairs. See Håkan, Nordström, The World Trade Organization Secretariat in a Changing World , 39 J. World Trade 819 (2005).Google Scholar