The World Trade Organization (WTO) faces two major challenges to its legitimacy and credibility as an international organization. The first is to make its internal decision-making system more transparent and inclusive, especially for the developing and least developed countries (which now represent the majority of its 147 members). This is the challenge of ‘internal legitimacy’. The second is to respond to external critics – mainly non-governmental organizations (NGOs) and non-state actors – who maintain that the WTO is a closed, non-democratic, bureaucratic, supranational entity. This is the issue of ‘external legitimacy’.
The external legitimacy challenge arises, in part, because the WTO administers a complex set of agreements that reach deeply into subjects formerly the exclusive province of national and subnational levels of government, for example, intellectual property, health and safety standards, regulation of services, and subsidies. In addition, the dispute settlement system, with its compulsory jurisdiction and binding decisions, more closely resembles domestic judicial systems than the normal, voluntary, international arbitration mechanisms.
With respect to the issue of internal legitimacy, the difficulty with the decision-making procedures in the WTO does not result from defects in the rules, per se, but rather from the inflexible determination of WTO members to take all decisions by consensus. Changing the decision-making rules is not likely to change the attitudes of WTO members. Moreover, it would increase the perceptions of developing countries that they are not included in the important decision-making processes.