The World Trade Organization Law, Practice, and Policy

by Matsushita, Mitsuo; Schoenbaum, Thomas J.; Mavroidis, Petros C.

• ISBN13: 9780199284566
• ISBN10: 0199284563
• Edition: 2nd
• Format: Hardcover
• Copyright: 2006-06-01
• Publisher: Oxford University Press

Summary

"This comprehensively revised new edition of the acclaimed work by an outstanding team of WTO law specialists, provides a complete overview of the law and practice of the WTO."--BOOK JACKET.

Author Biography

Mitsuo Matsushita is Professor Emeritus at Tokyo University and a former member of the WTO Appellate Body.
Thomas J. Schoenbaum is Rusk Professor of International Law at the University of Georgia.
Petros C. Mavroidis is Professor of Law at the University of Neuchatel.

Table of Contents

Index of WTO Panels	xxxviii
Index of GATT Panels	liii
Tables of WTO and GATT Decisions	lxvi
Tables of Court and Administrative Decisions	xcviii
1. The World Trade Organization	1	(18)
1. Bretton Woods and the failure of the International Trade Organization	1	(1)
2. The GATT becomes an international organization	2	(1)
3. A summary of GATT obligations	3	(2)
4. The GATT tariff negotiating rounds	5	(1)
5. The creation of the WTO	6	(3)
6. The WTO: functions and structure	9	(5)
6.1 Membership, accession and withdrawal	11	(1)
6.2 Decision-making	12	(2)
6.2.1 General decision-making	12	(1)
6.2.2 Interpretations	12	(1)
6.2.3 Waivers	13	(1)
6.2.4 Amendments	13	(1)
6.3 The WTO as an international organization	14	(1)
7. Suggestions for improving the WTO	14	(2)
8. Current Work: The Doha Development Agenda	16	(3)
2. Sources of Law and Their Interpretative Elements	19	(70)
1. WTO: a hybrid system	21	(5)
2. Setting the scene for discussion: three preliminary observations	26	(11)
2.1 Classification through interpretation: the method, and its influences and repercussions	26	(6)
2.1.1 The Vienna Convention on the Law of Treaties enters the WTO	26	(4)
2.1.2 External considerations stemming from the interpretative process	30	(1)
2.1.2.1 Identifying the interpretative elements	30	(1)
2.1.2.2 Prejudging the legal value through interpretation	31	(1)
2.2 The long road from identification to classification	32	(5)
2.2.1 WTO adjudicating bodies have identified, but rarely classified	32	(1)
2.2.2 An attempt at classification: understanding the benchmarks	33	(4)
3. Sources of law	37	(21)
3.1 The covered agreements	37	(17)
3.1.1 Travaux préparatoires of the WTO agreement: legally relevant to ascertain	38	(1)
3.1.1.1 The content of the travaux préparatoires	40	(1)
3.1.1.2 Conditions for recourse to travaux préparatoires in practice	50	(3)
3.1.2 Subsequent practice	53	(1)
3.1.3 Subsequent agreements	53	(1)
3.2 International agreements reflected in the covered agreements	54	(4)
3.2.1 The Havana Charter	54	(1)
3.2.2 Agreements reflected in the TRIPS agreement	55	(1)
3.2.3 Agreements reflected in the SCM agreement	55	(1)
3.2.4 The legal relevance of the agreements mentioned in the WTO agreement	56	(2)
4. Interpretative elements	58	(29)
4.1 GATT panel reports	58	(3)
4.1.1 Adopted GATT reports	59	(1)
4.1.2 Un-adopted GATT reports	60	(1)
4.2 WTO panel and Appellate Body reports	61	(3)
4.3 Decisions and recommendations by various WTO organs	64	(3)
4.3.1 Decisions and recommendations by WTO Committees	64	(2)
4.3.2 WTO Working Party reports	66	(1)
4.4 International agreements not reflected in the WTO agreement	67	(4)
4.4.1 The Tokyo round agreements	67	(1)
4.4.2 Other international agreements	67	(1)
4.4.2.1 Agreements referred to in WTO decisions	68	(1)
4.4.2.2 Bilateral agreements among WTO Members	68	(1)
4.4.2.3 Multilateral agreements	69	(2)
4.5 Acts adopted by various international organizations	71	(1)
4.5.1 United Nations (UN) Resolutions	71	(1)
4.5.2 ITU Recommendations	71	(1)
4.5.3 OECD Guidelines	71	(1)
4.6 Decisions by international courts	72	(1)
4.7 Domestic law and practice	72	(1)
4.8 Unilateral declarations by WTO Members	73	(3)
4.8.1 Unilateral declarations outside panel proceedings	73	(2)
4.8.2 Unilateral declarations made during panel proceedings	75	(1)
4.9 Customary international law	76	(5)
4.10 General principles of law	81	(5)
4.10.1 The nature of general principles	81	(1)
4.10.2 Estoppel	82	(1)
4.10.3 Good Faith (Bona Fides)	83	(1)
4.10.4 Error	84	(1)
4.10.5 Res judicata	84	(1)
4.10.6 In dubio mitius	85	(1)
4.10.7 Non adimplenti contractus	86	(1)
4.11 Doctrine	86	(1)
5. Conclusions	87	(2)
3. WTO Law and Domestic Law	89	(14)
1. Introduction	89	(2)
2. The United States	91	(4)
2.1 Overview of U.S. law	91	(1)
2.2 The relationship between WTO law and U.S. law	92	(3)
3. The European Community	95	(4)
3.1 External relations and the EU/EC	95	(2)
3.2 The relationship between WTO law and the laws of the EC and its Member States	97	(2)
4. Japan	99	(4)
4.1 Overview of Japanese law	99	(4)
4. Dispute Settlement	103	(30)
1. Introduction	104	(1)
2. Dispute settlement in the GATT	105	(2)
3. WTO dispute settlement	107	(26)
3.1 General considerations	108	(1)
3.2 Institutions	108	(1)
3.3 Scope of application	109	(2)
3.4 The legal effect of panel and Appellate Body reports	111	(1)
3.5 Dispute resolution procedures	112	(3)
3.5.1 Objectives	112	(1)
3.5.2 Initiation: request for consultations	113	(1)
3.5.3 Standing to bring claims	113	(1)
3.5.4 Good offices, conciliation, and mediation	114	(1)
3.5.5 Arbitration	115	(1)
3.6 The panel process	115	(2)
3.7 The appeal process	117	(1)
3.8 Implementation
3.8.1 Reasonable period for implementation	117	(1)
3.8.2 Compliance and the -sequencing" problem	118	(1)
3.9 Compensation for failure to comply and retaliation	119	(2)
3.10 Special dispute resolution procedures	121	(2)
3.10.1 Non-violation complaints	121	(1)
3.10.2 Situation complaints	122	(1)
3.11 Adverse inference	123	(1)
3.12 Amicus curiae	124	(1)
3.13 Burden of proof	125	(2)
3.14 Judicial economy	127	(1)
3.15 Standard of review	128	(3)
3.16 Critique of the DSU	131	(2)
4. Trade retaliation under national laws	133	(8)
4.1 The European Union	133	(1)
4.2 Japan	134	(1)
4.3 The United States	135	(3)
4.4 Critique of trade retaliation under national laws	138	(3)
5. Enforcement of WTO Obligations: Remedies and Compliance	141	(60)
1. Enforcing WTO obligations	143	(1)
2. The types of complaint available	144	(1)
3. Recommendations and suggestions by WTO adjudicating bodies	145	(9)
3.1 Recommendations	146	(2)
3.1.1 The substantive content of a recommendation	147	(1)
3.1.2 The function of a recommendation	147	(1)
3.1.3 The legal force of a recommendation	147	(1)
3.2 Suggestions	148	(6)
3.2.1 The substantive content of a suggestion	148	(1)
3.2.2 The function of a suggestion	148	(1)
3.2.3 Requesting a suggestion	149	(1)
3.2.3.1 Requests for suggestions must be specific	149	(1)
3.2.3.2 Discretion as to suggestion, even when requested	149	(1)
3.2.3.3 The dominant case for suggestions (when requested): no other way to implement	151	(2)
3.2.4 Un-requested suggestions	153	(1)
3.2.4.1 Legislative "suggestion": the case of export subsidies	153	(1)
3.2.4.2 Other cases	154	(1)
3.2.5 Suggestions are not binding	154	(1)
4. Reasonable period of time (RPT)	154	(6)
4.1 Bilateral definition of the RPT	155	(1)
4.2 Multilateral definition of the RPT	155	(5)
4.2.1 The regulatory framework	155	(1)
4.2.2 The task of the Arbitrator	155	(1)
4.2.3 Measuring the RPT under Art 21.3c DSU	156	(1)
4.2.3.1 The function of the 15 month guideline	156	(1)
4.2.3.2 Attendant Circumstances	157	(3)
5. Compliance panels	160	(5)
5.1 The mechanics	160	(1)
5.2 The rationale for compliance panels and the sequencing issue	161	(2)
5.3 The mandate of compliance panels	163	(2)
5.4 Compliance panel reports can be appealed	165	(1)
5.5 More than one compliance panel on the same dispute?	165	(1)
6. Requesting countermeasures	165	(31)
6.1 The right to request countermeasures	165	(1)
6.2 The function of compensation, suspension of concessions or other obligations	166	(2)
6.3 The form of countermeasures	168	(1)
6.4 The procedure to be followed	169	(6)
6.5 The legal constraint of Art 22.4 DSU	175	(1)
6.6 Agreement between the parties	175	(1)
6.7 Disagreement between the parties	176	(29)
6.7.1 Compulsory submission to the Arbitrators	176	(1)
6.7.2 The task of the Arbitrators	176	(2)
6.7.3 The burden of proof	178	(1)
6.7.4 The Arbitrators' decision: first and last resort	179	(1)
6.7.5 Calculating the level of suspension of concessions	180	(1)
6.7.5.1 Economics matter	180	(1)
6.7.5.2 Standard of review	182	(1)
6.7.5.3 No room for punitive damages	183	(1)
6.7.5.4 Retroactive or prospective remedies?	185	(1)
6.7.5.5 Indirect benefits	187	(1)
6.7.5.6 Only added value matters	189	(1)
6.7.5.7 Litigation costs are not recoverable	190	(1)
6.7.5.8 Calculating countermeasures following a GATS-violation	190	(1)
6.7.5.9 The special case of prohibited subsidies	191	(5)
7. Compliance following the adoption of countermeasures	196	(1)
8. To conclude ...	196	(5)
6. The Most-Favoured Nation Clause (MFN)	201	(32)
1. MFN: some basic economic concepts and institutional realities	202	(3)
2. The MFN regime as enshrined in Art I GATT	205	(14)
2.1 The coverage summarized	205	(1)
2.2 The policies (conferring an advantage) covered	206	(3)
2.2.1 Border measures of a fiscal character	206	(2)
2.2.2 Border measures of a non-fiscal character	208	(1)
2.2.3 Internal measures	209	(1)
2.3 The original beneficiary of the advantage	209	(1)
2.4 The extension of the advantage of WTO membership	209	(8)
2.4.1 Extension to like products	209	(2)
2.4.2 Like products originating in WTO Member States	211	(1)
2.4.3 Extending MFN-treatment immediately and unconditionally	212	(5)
2.5 The standard of review	217	(2)
2.5.1 De jure and de facto discrimination covered	217	(1)
2.5.2 No demonstration of effects or intent required	218	(1)
2.5.3 No rebalancing permitted	219	(1)
3. Exceptions to the MFN clause	219	(14)
3.1 Special and differential treatment for developing countries	220	(9)
3.1.1 The Enabling clause	220	(1)
3.1.2 Some historical features	221	(5)
3.1.3 The placement of the Enabling clause in the WTO legal order	226	(1)
3.1.4 An exception to Art I GATT	226	(1)
3.1.5 Non discrimination in the context of the Enabling clause	227	(2)
3.1.6 Allocation of burden of proof	229	(1)
3.2 Discriminatory quotas (Art XIV GATT)	229	(2)
3.3 Waivers	231	(2)
7. The National Treatment Principle	233	(24)
1. What is the national treatment principle?	234	(2)
2. National treatment: some key issues	236	(9)
2.1 "Like" products	236	(4)
2.1.1 Article III:2, first sentence	237	(1)
2.1.2 Article III:2, second sentence	237	(1)
2.1.3 Article III:4	238	(1)
2.1.4 The aim and effects test	239	(1)
2.2 The product-process distinction	240	(1)
2.3 Technical regulations and sanitary and phytosanitary measures	241	(1)
2.4 Application of Article III to state-trading monopolies	242	(1)
2.5 Application of Article III national treatment obligations to sub-federal units of WTO Members	243	(1)
2.6 The relationship between Article III and Article XI of the GATT	244	(1)
3. Taxes	245	(4)
3.1 Scope	246	(1)
3.2 Border tax adjustment	246	(1)
3.3 The non-discrimination principle	247	(2)
4. Government regulations	249	(3)
5. De facto discrimination	252	(4)
6. Article XX exceptions	256	(1)
8. Tariffs, Quotas and Other Barriers to Market Access	257	(30)
1. Introduction	258	(1)
2. Tariffs and customs rules	259	(10)
2.1 The nature of a tariff	259	(1)
2.2 Welfare effects of tariffs	259	(2)
2.3 Tariff modifications	261	(1)
2.4 Reclassification	262	(1)
2.5 Valuation	263	(2)
2.6 Rules of origin	265	(2)
2.7 Customs laws and procedures	267	(1)
2.8 Customs fees and formalities	268	(1)
2.9 Preshipment inspection (PSI)	268	(1)
3. Quotas	269	(6)
3.1 The nature of a quota	269	(1)
3.2 Welfare effects of quotas	270	(1)
3.3 Prohibition on quotas and other measures that restrain trade	270	(2)
3.4 Exceptions to the prohibition on quotas and other measures	272	(2)
3.5 Licensing	274	(1)
4. State-trading enterprises	275	(3)
5. Technical barriers to trade	278	(2)
6. Sanitary and phytosanitary measures	280	(1)
7. Sectoral market access agreements	281	(6)
7.1 Agriculture	281	(1)
7.2 Textiles and clothing	282	(2)
7.3 Information technology	284	(1)
7.4 Electronic commerce	284	(3)
9. Agriculture	287	(44)
1. Trading farm products in the GATT era	288	(4)
1.1 The legal framework	288	(3)
1.2 The reality	291	(1)
2. The Uruguay round brings change	292	(3)
2.1 Negotiators with export interest pushed...	292	(1)
2.2 ...and internal (EC) reform helped as well...	293	(1)
2.3 ...to make a start	294	(1)
3. The WTO Agreement on Agriculture summarized	295	(4)
3.1 How to liberalize farm trade	295	(1)
3.2 The AG Agreement in context	296	(1)
3.3 Absence of hierarchy? The AG Agreement and the national schedules of concession	297	(2)
3.4 Product-specific coverage of the AG Agreement	299	(1)
4. The restrictions on domestic subsidies	299	(16)
4.1 The obligation to convert existing process into tariffs	299	(2)
4.2 Calculating the level of protection	301	(8)
4.2.1 The AMS is the benchmark for commitments	301	(2)
4.2.2 The extent of the AMS	303	(2)
4.2.3 Exemptions from the AMS	305	(1)
4.2.3.1 De minimis thresholds	305	(1)
4.2.3.2 Production limiting programmes (Blue box)	306	(1)
4.2.3.3 Support to low-income producers in developing countries	306	(1)
4.2.3.4 Minimal, or non-trade-distorting schemes (Green box)	307	(2)
4.3 The resulting perspective: tariff peaks, no ad valorem duties	309	(6)
5. Export subsidy commitments	315	(12)
5.1 What is an "export subsidy"?	315	(3)
5.1.1 Export subsidies explicitly mentioned	315	(3)
5.1.2 De facto export subsidies	318	(1)
5.2 The restrictions with respect to export subsidies	318	(6)
5.2.1 The regime summarized	318	(1)
5.2.1.1 Scheduled goods, schemes covered by Art 9.1 AG	322	(1)
5.2.1.2 Unscheduled goods, schemes covered by Art 9.1 AG	322	(1)
5.2.1.3 Scheduled and unscheduled goods, schemes not covered by Art 9.1AG	322	(1)
5.2.2 The standard of review for violations of export subsidy commitments (Art 3.3 AG)	323	(1)
5.2.3 The standard of review for violations of the anti-circumvention provision (Art 10 AG)	323	(1)
5.3 WTO Members' commitments on export subsidies	324	(3)
6. Other commitments	327	(2)
6.1 Due restraint (Peace Clause)	327	(1)
6.2 Export prohibition	327	(1)
6.3 Transparency requirements	327	(1)
6.4 Least developed and net food-importing developing countries	328	(1)
7. Agriculture in the development round	329	(2)
10. Subsidies and Countervailing Duties	331	(64)
1. Thou shalt not subsidize	332	(4)
2. A subsidy in the SCM sense of the term	336	(28)
2.1 Financial contribution	336	(10)
2.1.1 Direct and indirect financial contribution	336	(1)
2.1.2 Financial contribution: an expansive interpretation	337	(4)
2.1.3 The special case of double taxation	341	(1)
2.1.4 Recourse to regulatory diversity to determine whether financial contribution exists	342	(1)
2.1.5 Attributing financial contribution to a government	343	(3)
2.2 A benefit conferred	346	(6)
2.2.1 The private investor-test	347	(4)
2.2.2 The cost of production	351	(1)
2.3 The recipient: specific (and also unintentional)	352	(3)
2.4 Methods for calculation of benefit	355	(5)
2.5 Classification of subsidies	360	(4)
2.5.1 Prohibited subsidies	360	(4)
2.5.2 Actionable subsidies	364	(1)
2.5.3 Non-actionable subsidies	364	(1)
3. Counteracting subsidies	364	(26)
3.1 The multilateral option	365	(10)
3.1.1 Prohibited subsidies	365	(4)
3.1.2 Adverse effects	369	(1)
3.1.2.1 Adverse effects resulting in serious prejudice	369	(1)
3.1.2.2 Adverse effects resulting in nullification or impairment	374	(1)
3.1.2.3 Legal action to eliminate adverse effects	374	(1)
3.2 The unilateral option: countervailing duties (CVDs)	375	(21)
3.2.1 The conditions for lawful imposition	375	(1)
3.2.1.1 The substantive requirement	375	(1)
3.2.1.2 The procedural requirements	382	(2)
3.2.2 Imposition of CVDs	384	(1)
3.2.2.1 The level of CVDs (Lesser duty rule)	384	(1)
3.2.2.2 Imposition of CVDs on an aggregate basis	384	(1)
3.2.2.3 Retroactive application of CVDs	385	(1)
3.2.3 Review of CVDs	385	(1)
3.2.3.1 The sunset review	386	(1)
3.2.3.2 The administrative review	387	(3)
4. Thou shalt not be punished in any other way	390	(2)
5. Special and differential treatment	392	(1)
6. Standard of review	393	(1)
7. Conclusions	393	(2)
11. Antidumping	395	(42)
1. What is dumping?	396	(5)
1.1 Dumping as sales below cost	397	(1)
1.2 Dumping as international price discrimination	398	(1)
1.3 Duration	399	(1)
1.4 Cost analysis	399	(1)
1.5 Welfare effects	400	(1)
1.6 Measures to counteract dumping	400	(1)
2. The regulation of antidumping duties	401	(26)
2.1 The legal framework of antidumping in the GATT/WTO regime	401	(2)
2.1.1 GATT Article VI	402	(1)
2.1.2 The Antidumping Agreement	402	(1)
2.1.3 Institutions and notifications	403	(1)
2.1.4 Developing countries	403	(1)
2.2 Investigation	403	(3)
2.2.1 Initiating an investigation	403	(1)
2.2.2 Evidential issues	404	(2)
2.2.3 The duties of the investigating authority	406	(1)
2.3 Determination of dumping	406	(11)
2.3.1 Like product	407	(2)
2.3.2 Comparison of third-country prices	409	(1)
2.3.3 Constructed value	409	(2)
2.3.4 Arm's-length transactions and transactions between affiliated parties	411	(1)
2.3.5 Sales below cost	412	(1)
2.3.6 Fair price comparisons	413	(1)
2.3.7 Averaging	414	(1)
2.3.8 Zeroing	415	(2)
2.4 Determination of injury	417	(4)
2.4.1 Material injury or threat of material injury	417	(1)
2.4.2 Factors to be considered when determining injury	418	(1)
2.4.3 Factors to be considered when determining threat	419	(1)
2.4.4 Cumulation of injuries	419	(1)
2.4.5 Causation	420	(1)
2.5 Domestic industry	421	(1)
2.6 The imposition of antidumping measures	422	(2)
2.6.1 Provisional measures	422	(1)
2.6.2 Definitive measures	423	(1)
2.6.3 Retroactivity	423	(1)
2.6.4 Duration and review	423	(1)
2.7 Price undertakings (suspension of antidumping duty investigations)	424	(1)
2.8 Anti-circumvention	424	(1)
2.9 Dispute settlement	425	(2)
3. Criminal penalties and private remedies	427	(6)
3.1 The U.S. 1916 Antidumping Act	428	(2)
3.2 Future implications of the panel and the Appellate Report on the 1916 Act case	430	(1)
3.3 The U.S. Offset Act	431	(2)
4. Conclusions	433	(4)
12. Safeguards	437	(38)
1. Introduction	438	(1)
2. The legal and policy framework for safeguards in the GATT/WTO regime	439	(1)
3. GATT Article XIX and the Agreement on Safeguards	440	(20)
3.1 GATT Article XIX	440	(1)
3.2 The Safeguards Agreement	440	(1)
3.3 The relationship between GATT Article XIX and the Safeguards Agreement	441	(1)
3.4 Investigation	442	(1)
3.5 Provisional application	443	(1)
3.6 Determination of increased imports	443	(1)
3.7 Unforeseen developments	444	(2)
3.8 Determination of injury	446	(5)
3.8.1 Serious injury or threat of serious injury	446	(1)
3.8.1.1 Serious injury	447	(1)
3.8.1.2 Threat of serious injury	447	(1)
3.8.1.3 Factors to be considered when determining injury or threat thereof	448	(1)
3.8.1.4 Domestic industry	449	(1)
3.8.2 Causation	449	(2)
3.9 Limits on the application of safeguard measures	451	(6)
3.9.1 Parallelism	451	(3)
3.9.2 Non-attribution	454	(1)
3.9.3 Extent of safeguards	455	(1)
3.9.4 Selectivity	455	(1)
3.9.5 Developing countries	456	(1)
3.9.6 GATT Article XIII	456	(1)
3.9.7 Duration and review	457	(1)
3.10 Notification and consultation	457	(1)
3.11 Compensation	458	(2)
3.12 The standard of review for safeguard disputes	460	(1)
4. Safeguard measures for balance-of-payment reasons	460	(5)
4.1 The GATT	460	(3)
4.2 The WTO	463	(2)
5. Safeguard measures in textile and clothing trade	465	(2)
6. Prohibition on voluntary export restraints	467	(10)
6.1 Prohibition in the Safeguards Agreement	467	(1)
6.2 Tension between voluntary export restraints and competition policy	468	(15)
6.2.1 The automobile VER case	469	(3)
6.2.2 The steel VER Case	472	(1)
6.2.3 Analysis of the conflict between trade policy and competition policy	473	(2)
13. Technical Barriers to Trade: TBT and SPS	475	(72)
1. The role of TBT and SPS	477	(4)
2. The legal relationship between GATT, TBT and SPS	481	(2)
3. Technical Barriers to Trade	483	(19)
3.1 Coverage	483	(2)
3.2 Technical regulations	485	(14)
3.2.1 National treatment and MFN	485	(1)
3.2.2 International standards	486	(1)
3.2.2.1 The definition of international standards in TBT	489	(1)
3.2.2.2 International standards and the necessity requirement	491	(1)
3.2.2.3 Technical regulations must be based on international standards	491	(1)
3.2.2.4 Legitimate objectives pursued through international standards	492	(1)
3.2.2.5 Deviating from inappropriate or ineffective international standards	493	(1)
3.2.2.6 Burden of proof in case of deviation	494	(2)
3.2.3 Unilateral technical regulations	496	(1)
3.2.3.1 The necessity requirement	497	(1)
3.2.3.2 Performance requirements	497	(1)
3.2.3.3 Mutual recognition agreements (MRAs)	498	(1)
3.2.3.4 Additional obligations	498	(1)
3.3 Standards	499	(2)
3.3.1 National treatment	499	(1)
3.3.2 Code of Good Practice	500	(1)
3.4 Common (to technical regulations and standards) provisions	501	(1)
3.4.1 Conformity assessment	501	(1)
3.4.2 Special and differential treatment	501	(1)
3.4.3 Expert groups	502	(1)
4. The Sanitary and Phytosanitary Measures	502	(38)
4.1 Coverage	502	(1)
4.2 International standards	503	(6)
4.2.1 Recourse to international standards	503	(2)
4.2.2 International standards and the necessity requirement	505	(1)
4.2.3 SPS measures must be based on international standards	505	(2)
4.2.4 Deviating from international standards	507	(1)
4.2.5 Burden of proof in cases of deviation from international standards	508	(1)
4.3 National SPS measures	509	(28)
4.3.1 National treatment and MFN for nationally-defined SPS measures	509	(1)
4.3.2 SPS measures on scientific evidence	510	(1)
4.3.2.1 The obligation to have recourse to scientific evidence	510	(1)
4.3.2.2 Defining risk	511	(1)
4.3.2.3 Defining risk assessment	512	(11)
4.3.3 The necessity requirement in the trade context: least restrictive option	523	(1)
4.3.3.1 The test for consistency with Art 5.6 SPS	524	(1)
4.3.3.2 The appropriate level of protection	524	(3)
4.3.4 Consistency in the application of the appropriate level of protection	527	(5)
4.3.5 SPS measures adopted on precaution	532	(1)
4.3.5.1 The precautionary principle in the WTO and in customary international law	532	(1)
4.3.5.2 Precaution and scientific evidence	534	(1)
4.3.5.3 Establishing (in-)consistency with Art 5.7 SPS	535	(2)
4.4 Remaining SPS provisions	537	(2)
4.4.1 Control inspection and approval procedures	537	(1)
4.4.2 Equivalence	538	(1)
4.4.3 Procedural obligations	539	(1)
4.5 Special and differential treatment	539	(1)
5. Recourse to experts	540	(4)
5.1 Appointment of experts	540	(1)
5.2 The legal relevance of expertise	541	(1)
5.3 To bear in mind...	542	(2)
6. Standard of review	544	(1)
7. Conclusions	544	(3)
14. Preferential Trade Agreements in the WTO	547	(44)
1. Preferential trade agreements (PTAs) in the WTO: FTAs and CUs	548	(1)
2. Globalization yet preferences too	549	(2)
3. What matters in preferential trade?	551	(3)
4. PTAs in the GATT	554	(24)
4.1 No intrinsic inconsistency	554	(1)
4.2 The Art XXIV GATT test summarized	555	(1)
4.3 Designed at home, approved (?) in Geneva	555	(4)
4.3.1 Two tracks available for review of the consistency of FTAs and CUs	555	(1)
4.3.2 Choice of track	556	(3)
4.4 The multilateral track	559	(14)
4.4.1 The duty to notify a PTA	559	(1)
4.4.1.1 A brief summary, of the CRTA	559	(1)
4.4.1.2 When to notify?	560	(2)
4.4.2 The external requirement	562	(1)
4.4.2.1 Free Trade Areas (FTAs)	562	(1)
4.4.2.2 Customs Unions	564	(4)
4.4.3 The internal requirement	568	(1)
4.4.3.1 The test summarized	568	(1)
4.4.3.2 Substantially all trade	568	(1)
4.4.3.3 Other restrictive regulations of commerce	570	(2)
4.4.4 Conclusions	572	(1)
4.5 The bilateral track	573	(4)
4.5.1 GATT panels: conflicting or scarce evidence	574	(1)
4.5.2 WTO panels: potential PTA-busters	575	(2)
4.6 Reviewing GAT jurisprudence	577	(1)
5. PTAs in the GATS-context	578	(4)
5.1 The procedural obligation	578	(1)
5.2 The substantive obligations	578	(2)
5.2.1 The internal requirement	578	(1)
5.2.2 The external requirement	579	(1)
5.3 Extending the benefits to third parties	580	(1)
5.4 Two available tracks	580	(1)
5.5 The standard of review	580	(1)
5.6 Labour market integration agreements	581	(1)
5.7 GATS: no jurisprudence	581	(1)
5.8 Should PTAs cover both GATTS and GATS?	581	(1)
6. No panel jurisprudence (for good reasons)	582	(6)
6.1 The outsiders: if I don't do it, somebody else will	583	(4)
6.1.1 Risk averse agents (panels)	584	(1)
6.1.2 Cost of litigation	585	(1)
6.1.3 De minimis? Less enforcement, better (export) opportunities	586	(1)
6.1.4 Unnecessary restriction of future options	586	(1)
6.1.5 Corruption	586	(1)
6.1.6 Too much at stake?	587	(1)
6.2 The incumbents: I won't do it, you shouldn't either (no room for an eye for an eye)	587	(1)
6.3 Is there a third group of countries?	588	(1)
7. MFN is LFN	588	(3)
15. Export Controls and National Security	591	(10)
1. Introduction	591	(1)
2. Export restraints	592	(1)
3. Export taxes	593	(1)
4. Security exceptions	594	(4)
5. Extraterritorial application of export controls	598	(2)
6. Conclusions	600	(1)
16. Trade in Services	601	(94)
1. The advent of GATS	604	(5)
2. The relationship between GATT and GATS	609	(2)
3. The scope of GATS: liberalization of trade in services	611	(6)
3.1 Defining service	611	(2)
3.2 Defining measures affecting trade in services	613	(3)
3.3 Modes of supply	616	(1)
4. Non-retroactivity of obligations assumed under GATS	617	(2)
5. General obligations	619	(21)
5.1 MFN	619	(7)
5.1.1 Likeness of services (and service suppliers)	620	(1)
5.1.2 Automatically and unconditionally	621	(1)
5.1.3 The standard of review: de jure, de facto discrimination	622	(1)
5.1.4 MFN exceptions	623	(3)
5.2 Transparency	626	(1)
5.3 Economic integration	627	(1)
5.4 Domestic regulation	627	(3)
5.5 Mutual recognition	630	(2)
5.6 Competition-related requirements	632	(1)
5.7 Safeguards	633	(1)
5.8 Payments and transfers	633	(1)
5.9 Subsidies	634	(1)
5.10 General exceptions	635	(5)
5 10.1 A brief overview of Art XIV GATS	635	(1)
5.10.2 Necessity in Art XIV GATS	636	(1)
5.10.2.1 Necessary to protect public morals or public order	638	(1)
5.10.2.2 Necessary to secure compliance	639	(1)
5.10.2.3 Compliance with the chapeau of Art XIV GATS	639	(1)
5.11 Institutional provisions	640	(1)
6. Specific commitments	640	(8)
6.1 The primacy of CPC	640	(2)
6.2 The scheduling modalities	642	(5)
6.2.1 The 1993 and 2001 Scheduling Guidelines	642	(3)
6.2.2 Horizontal and sector-specific commitments	645	(1)
6.2.3 The level of commitments: none, unbound and in-between	646	(1)
6.3 Interpreting commitments by WTO members	647	(1)
7. Art XVI GATS: market access under the GATS	648	(11)
7.1 The objective function of Art XVI GATS	648	(6)
7.2 How to schedule Art XVI commitments	654	(1)
7.3 Can WTO Members restrict access to their market through measures other than those defined in Art XVI.2 GATS?	655	(2)
7.4 Relationship with other provisions	657	(2)
7.4.1 Art XVI — Art XVII GATS	657	(1)
7.4.2 Art XVI — Art VI GATS	657	(2)
7.4.3 Art XVI — Art XIV GATS	659	(1)
8. Art XVII GATS: national treatment	659	(9)
8.1 The scope of national treatment	659	(3)
8.2 The test of Art XVII GATS summarized	662	(1)
8.3 Applying the test	662	(4)
8.3.1 Specific commitments must have been undertaken	662	(1)
8.3.2 Measure affecting trade in services	662	(1)
8.3.3 Like services or service suppliers	663	(1)
8.3.4 Treatment no less favourable	664	(2)
8.4 Standard of review: de jure and de facto violations	666	(1)
8.5 Relationship with other provisions	667	(1)
8.5.1 Art XVII — Art XVI GATS	667	(1)
8.5.2 Art XVII — Art VI GATS	667	(1)
8.5.3 Art XVII — Art XIV GATS	667	(1)
9. Art XVIII GATS: additional commitments	668	(2)
9.1 The scope of additional commitments	668	(1)
9.2 The mechanics of scheduling additional commitments	669	(1)
9.3 Relationship with other provisions	669	(1)
9.3.1 Art XVIII — Art II GATS	669	(1)
9.3.2 Art XVIII — Art XIV GATS	669	(1)
9.3.3 Art XVIII — Art XXI GATS	669	(1)
10. Changes in the specific commitments	670	(4)
10.1 Replacing and adding to past commitments	670	(3)
10.2 Multilateral modification of schedules	673	(1)
10.3 Unilateral modification of schedules	673	(1)
11. Liberalizing trade in services: an empirical view	674	(3)
12. The WTO Telecoms Agreement	677	(15)
12.1 A lengthy negotiation process	677	(1)
12.2 Sources of law	678	(2)
12.2.1 The Annex	679	(1)
12.3 The Reference Paper	680	(9)
12.3.1 The rationale for negotiating the Reference Paper	680	(2)
12.3.2 The Reference Paper summarized	682	(1)
12.3.3 Anti-competitive practices envisaged	683	(1)
12.3.4 Interconnection	684	(1)
12.3.4.1 Who should abide by? Defining the major supplier	684	(1)
12.3.4.2 International (?) interconnection	685	(1)
12.3.4.3 Cost-orientated rates for interconnection	687	(1)
12.3.4.4 Interconnection on reasonable terms and conditions	689	(1)
12.4 Scheduling commitments in telecoms	689	(19)
12.4.1 The telecoms-specificity of the Services Sectoral Classification List	689	(1)
12.4.2 Level of commitments by modes of supply	690	(1)
12.4.3 Types of limitations maintained	691	(1)
13. Conclusions	692	(3)
17. Intellectual Property	695	(44)
1. Introduction	696	(3)
2. Types of intellectual property rights addressed in the TRIPS Agreement	699	(5)
3. Overview of the TRIPS Agreement	704	(2)
4. Institutional arrangements	706	(1)
5. Provisions relating to developing countries	707	(1)
6. Public policy criticisms	708	(16)
6.1 Benefits and costs of higher IP standards for developing countries	709	(2)
6.2 Protection of traditional knowledge and culture	711	(1)
6.3 Biological diversity	712	(6)
6.3.1 Access to genetic resources	713	(3)
6.3.2 Patentability	716	(1)
6.3.3 Transfer of technology	717	(1)
6.4 Health	718	(5)
6.4.1 Compulsory licensing	719	(1)
6.4.2 Parallel imports	720	(2)
6.4.3 Beyond the TRIPS Agreement	722	(1)
6.5 Food	723	(1)
7. The general principles of the TRIPS Agreement	724	(1)
7.1 The relationship between the TRIPS Agreement and other intellectual property treaties	724	(1)
7.2 Acquisition and maintenance of intellectual property rights	724	(1)
7.3 National treatment and most-favoured-nation treatment	725	(1)
8. Minimum substantive standards	725	(7)
8.1 Copyright and related rights	725	(1)
8.2 Patents	726	(4)
8.2.1 Patent excludability	726	(1)
8.2.2 Limited exceptions	727	(1)
8.2.3 Compulsory licensing	728	(1)
8.2.3.1 Differing views on compulsory licensing	728	(1)
8.2.3.2 Provisions in the TRIPS Agreement	729	(1)
8.3 Trademarks and service marks	730	(1)
8.4 Geographical indications	730	(1)
8.5 Undisclosed information or trade secrets	731	(1)
8.6 Industrial designs	731	(1)
8.7 Layout designs of integrated circuits	731	(1)
9. Enforcement of intellectual property rights under the TRIPS Agreement	732	(2)
9.1 General principles	732	(1)
9.2 Civil and administrative procedures and remedies	732	(1)
9.3 Criminal procedures	732	(1)
9.4 Border measures	733	(1)
9.5 Provisional measures	733	(1)
9.6 Dispute settlement	734	(1)
10. Exhaustion of intellectual property rights	734	(1)
11. Restrictive business practices	735	(2)
11.1 Types of restrictive business practices involved in technology licensing agreements	735	(1)
11.2 Article 40 of the TRIPS Agreement	736	(1)
12. Conclusions	737	(2)
18. Government Procurement	739	(24)
1. The Government Procurement Agreement as a Plurilateral Agreement	740	(2)
2. The background of the Agreement on Government Procurement	742	(2)
2.1 General background	742	(1)
2.2 The Tokyo Round Agreement	743	(1)
3. Major features of the Agreement on Government Procurement	744	(7)
3.1 In general	744	(1)
3.2 Scope and coverage	745	(1)
3.3 National treatment and non-discrimination	746	(1)
3.4 Rules of origin	746	(1)
3.5 Special and differential treatment for developing countries	747	(1)
3.6 Technical specifications	747	(1)
3.7 Tendering procedures	748	(1)
3.8 Abnormally low tendering	749	(1)
3.9 Challenge procedures	749	(1)
3.10 Consultations and dispute settlement	750	(1)
3.11 Exceptions	750	(1)
3.12 Entry into force of the Agreement	751	(1)
4. Domestic implementation	751	(3)
4.1 Art XXIV of the Agreement	751	(1)
4.2 The European Communities	751	(1)
4.3 The United States	752	(1)
4.4 Japan	753	(1)
5. Dispute settlement in relation to the Agreement on Government Procurement	754	(27)
5.1 In general	754	(1)
5.2 GATT/WTO dispute cases	755	(27)
5.2.1 The Trondheim Case	755	(2)
5.2.2 The Korean Inchon Airport Case	757	(2)
5.2.3 The State of Massachusetts Case	759	(1)
5.2.4 The Japan Railway OR) Case — a dispute settlement at challenge procedures	760	(3)
19. Developing Countries	763	(1)
1. The developing world	763	(2)
2. A little history	765	(5)
3. GATT Article XX(h)	770	(1)
4. GATT Article XVIII	770	(2)
5. Part IV of the GATT	772	(1)
6. The generalized system of preferences	773	(4)
7. The Global System of Trade Preferences	777	(1)
8. Special and differential treatment provisions for developing countries in the Uruguay Round	777	(2)
9. Trade and economic development	779	(2)
10. Trade and the right to development	781	(1)
11. Enhancing market access	782	(1)
12. New initiatives	782	(3)
20. Environmental Protection and Trade	785	(1)
1. Introduction	786	(4)
2. Environmentalist trade demands: a critical analysis	790	(1)
3. The environmental impact of trade	790	(4)
4. The Tuna Dolphin cases: a false start	794	(3)
5. The WTO approach under GATT 1994	797	(34)
5.1 GATT Article XX(g)	797	(2)
5.2 GATT Article XX(b)	799	(2)
5.3 The chapeau of Article XX	801	(2)
6. Multilateral and bilateral environmental agreements	803	(2)
7. Unilateral measures	805	(1)
8. Protection of natural resources	806	(1)
9. Environmental standards and process and production methods	807	(1)
9.1 Standards and technical regulations	807	(1)
9.2 Process and production methods	808	(12)
9.2.1 Environmental agreements	811	(2)
9.2.2 Environmental management systems	813	(2)
9.2.3 Investment	815	(1)
10. Recycling and packaging	816	(2)
11. Eco-labels	818	(2)
12. The export of hazardous substances and wastes	820	(3)
12.1 Domestically prohibited goods	820	(1)
12.2 Waste	821	(2)
13. Environmental taxes	823	(6)
13.1 Taxes on products	826	(1)
13.2 Taxes on resource use	827	(1)
13.3 Taxes on inputs	827	(2)
14. Conclusions	829	(2)
21. Trade and Investment	831	(20)
1. Trade and investment in the WTO: from modest initial steps to high hopes and back	831	(7)
2. TRIMs	838	(11)
2.1 The scope of TRIMs	838	(1)
2.2 TRIMs after GATT: what value is added?	839	(5)
2.3 TRIMs and other WTO Annex 1A agreements	844	(1)
2.4 Substantive provisions	845	(3)
2.4.1 Standstill	845	(1)
2.4.2 Transitional phase	845	(1)
2.4.3 TRIMs inconsistent with Art Ill GATT	846	(1)
2.4.4 TRIMs inconsistent with Art XI GATT	847	(1)
2.5 Procedural obligations	848	(1)
2.5.1 Notification of TRIMs	848	(1)
2.5.2 Transparency	848	(1)
2.6 Remaining provisions	848	(4)
2.6.1 Review of TRIMs	848	(1)
2.6.2 Institutional Issues	849	(1)
3. Conclusions	849	(2)
22. Competition Policy and Trade	851	(56)
1. WTO and competition policy	852	(6)
1.1 Introduction	852	(1)
1.2 Anti-competitive conduct that adversely affects international trade	853	(5)
1.2.1 International cartels, export cartels and import cartels	853	(2)
1.2.2 Boycotts, tie-in contracts and vertical restraints	855	(1)
1.2.3 Mergers and acquisitions	856	(2)
2. Provisions on competition policy in the WTO agreements	858	(6)
2.1 Agreement on technical barriers to trade (TBT Agreement)	858	(2)
2.2 Trade in services	860	(2)
2.3 Intellectual property and trade-related investment measures	862	(1)
2.4 Safeguards and antidumping	863	(1)
3. Extraterritorial application of domestic competition laws	864	(10)
3.1 In general	864	(1)
3.2 The United States	865	(4)
3.3 The European Community	869	(2)
3.4 Germany	871	(1)
3.5 Japan	872	(2)
4. Conflict of jurisdictions	874	(7)
4.1 In general	874	(1)
4.2 The ICI case	874	(2)
4.3 The Swiss Watch case	876	(1)
4.4 The Laker case	877	(2)
4.5 The GE/Honeywell case	879	(1)
4.6 Summary	880	(1)
5. Trade policy and competition policy	881	(4)
5.1 Trade policy and competition	881	(1)
5.2 The Semiconductor case	882	(1)
5.3 Competition policy implications of the Semiconductor Agreement	883	(2)
6. International cooperation in competition policy	885	(8)
6.1 Globalizing economy and the need for convergence of competition law and policy	885	(1)
6.2 International cooperation in competition policy	886	(7)
6.2.1 Types of cooperation in competition policy	886	(2)
6.2.2 Positive comity	888	(1)
6.2.3 Cooperation in investigation	889	(1)
6.2.4 Convergence of competition policy and law	890	(2)
6.2.5 The ICPAC Report	892	(1)
7. The competition policy debates in the WTO	893	(8)
7.1 Activities of the working group on trade and competition policy in the WTO	893	(3)
7.2 Review of the working group's reports	896	(3)
7.2.1 Consensus	896	(1)
7.2.2 Divergent views	897	(2)
7.3 The Ministerial Declaration on Competition Policy adopted at the Doha Ministerial Conference in November 2001	899	(2)
8. Conclusions	901	(6)
8.1 Option 1: A declaration that competition policy is an integral part of the WTO regime	901	(1)
8.2 Option 2: A plurilateral agreement	901	(1)
8.3 Option 3: A non-binding multilateral framework for cooperation in competition policy	902	(2)
8.4 Option 4: A partly-binding multilateral framework	904	(3)
23. Future Challenges	907	(26)
1. Four crises	907	(7)
1.1 Interna9 decision-making	908	(2)
1.2 Civil society	910	(2)
1.3 Developing countries	912	(1)
1.4 Regional and bilateral free trade agreements	913	(1)
2. The multilateral trading system at a crossroads	914	(4)
3. Societal issues	918	(10)
3.1 The environment	918	(2)
3.2 Health	920	(1)
3.3 Workers' rights	921	(2)
3.4 Human rights	923	(1)
3.5 The poor	924	(2)
3.6 Intellectual property	926	(1)
3.7 Transparency	927	(1)
3.8 Governance	927	(1)
4. The Doha negotiating agenda	928	(5)
Annex 1: Article 22.6 Arbitrations	933	(4)
Annex 2: GATT & WTO Dispute Settlement Reports	937	(10)
Index	947