CP - Consult WTO - CNDI 2024

Consult WTO CP
1NC
1nc – eBay
The United States ought to enter into a prior, binding, consultation with the World Trade Organization, proposing a substantial increase in injunctions as the presumptive remedy for an ongoing violation of a valid patent, and should abide by the result.
1nc – Generic
The United States ought to enter into a prior, binding, consultation with the World Trade Organization, proposing [the plan] and abide by the result.
The CP bolsters WTO credibility and saves multilateralism – prior consultation on IP makes solves their legitimacy crisis.
Low ’22 (Patrick, Chief Economist of the WTO from 1995–2013, now a Fellow at Asia Global Institute, University of Hong Kong, “The WTO in Crisis: Closing the Gap between Conversation and Action or Shutting Down the Conversation?,” World Trade Review (2022), 1–17 doi:10.1017/S1474745622000064)
Trade and health has emerged as an issue as a result of COVID-19, putting pressure on the WTO to contribute through trade to the management of the pandemic. Elements of traditional trade policy relating to exports and imports are involved. These market access issues involving pharmaceuticals, personal protective equipment and vaccines are now being monitored. A major sticking point has been the proposal that certain elements of intellectual property (IP) rights relating to COVID-19 vaccines and other products relevant to the control of the pandemic should be relaxed in order to ensure adequate availability of these items on a global scale. Work is continuing on this set of issues, and there are those who believe that relaxing IP rights would not help and may hinder access to the products concerned. Although this may not be a systemic issue per se, the WTO’s reputation is on the line, considering the nature of the emergency and its implications for health. Agriculture is a long-standing issue that that has proven exceedingly difficult to solve. It has strong north–south characteristics, pitting many developed economies against developing ones. For the former, it generally represents a very small share of the economy, but involves significant political interests and social considerations that militate against trade openness. For many developing countries, agriculture is key to livelihoods, although over time successful diversification towards higher value-added production will ameliorate the pressure. Given the interests involved, the WTO’s capacity to influence outcomes is limited. Negotiations among a subset of WTO members on e-commerce have made some progress.7 These efforts reflect recognition of the need to ensure the relevance of the WTO in the face of changing policy imperatives and far-reaching developments in technology. This negotiating initiative is being played out alongside a work programme on e-commerce that has yielded little or nothing for over 20 years. The WTO needs a modern rulebook in this area. One of the challenges that emerges is that since the virtual economy is largely a networked industry, if policies and regulations are not sufficiently aligned, it becomes more difficult to avoid discriminatory outcomes that can put a strain on the trading system. Negotiations are underway on investment facilitation for development, and on micro, small, and medium-sized enterprises (MSMEs). Both of these negotiations are taking place among a subset of the membership and are further discussed below. The issue of gender was raised at the 17th Ministerial Conference in 2017 and an Informal Working Group was established in September, 2020. The Working Group is tasked with examining various aspects of gender in relation to trade and the work of the WTO. The Chairs of the Working Group prepared a draft outcome document intended for discussion at MC12. This work will continue.
Finally, labour standards are not subject to WTO rules but have been a long-standing issue of concern for some developed countries. The 1996 Singapore Ministerial Declaration reaffirmed WTO members’ committed to international core labour standards and the work of the International Labour Organization to promote them. The Declaration also rejected the use of labour standards for protectionist purposes. Some developed countries have made observance of labour standards a pre-condition of access to unilaterally granted preferences under the Generalized System of Preferences. The United States has also introduced the issue of forced labour into the negotiations on fisheries subsides. The alleged use of forced labour in China has surfaced as a trade-related matter. Labour issues are not going to fade away from trade discussions. 4.1 The Dispute Settlement Crisis The GATT/WTO dispute settlement system has often been acclaimed as a path-breaking and unique system for settling disputes between governments. Over many years, the record of disputes that were successfully settled and acted upon has been impressive. With the addition of the Appellate Body (AB) in the Uruguay Round, things began to change. Although the AB seemed to have worked well in the early years of its existence, difficulties started to arise in the early 2000s. Although an operational dispute settlement system is essential to the effective working of the GATT/WTO, in practice dozens of WTO members have rarely if ever had recourse to the dispute settlement system. Two of the major users of the dispute settlement system – the United States and the EU – have never been entirely aligned philosophically in relation to the reach of authority of juridical bodies operating at the international level. It is not far-fetched to suggest that these two trading powers are at the centre of the present difficulties. The EU more readily submits to international adjudication than does the United States. The history of dispute settlement has been punctuated by efforts to resolve the differences. In the 1980s, the then Director-General, Arthur Dunkel, was pressured into dividing the dispute settlement function into two units. The Rules Division was made responsible for disputes involving contingency trade measures (anti-dumping, countervailing duties, and safeguards). The Legal Affairs Division was responsible for the rest. The split reflected tensions between the United States and the EU and did not contribute to coherence. There was at least one occasion in the memory of this author when a sitting Director-General had to negotiate the appointment of a Director of the Legal Affairs Division – a clear departure from normal practice where directorlevel appointments are not subject to veto or approval from delegations. Prior to the entry into force in 1995 of the Dispute Settlement Understanding (DSU) with the establishment of the WTO, the consensus rule had made it possible for a complainant or a respondent in a dispute to block a finding. The DSU eliminated this possibility, and in exchange members agreed to the option of a second layer of adjudication with the establishment of the Appellate Body (AB). In this manner, authority was essentially transferred to the adjudicators of the system (dispute settlement panels and the AB). A revealing anecdote on the implications of this decision was a conversational remark to the author by Professor Robert Hudec shortly before his untimely death. His musings turned on the question whether these new arrangements were a step too far for the institution. Were governments really ready to forego the diplomacy and attention to political exigencies that the consensus rule allowed? Was too much sovereignty assigned to an inter-governmental body? The answer to this question turns in part on the view taken of what went wrong with the AB and whether it can be fixed.8 The concerns that have been voiced, mostly by the United States but doubtless shared in other quarters, are well known.9 A central concern is that the AB exceeded its remit by arguably on occasion crossing the line between legal interpretation of the WTO agreements and law-making. Other concerns involve the re-interpretation of the facts of a case, which are supposed to be outside the AB’s scope of authority, and the time taken to resolve cases. These tendencies have given rise to particular objections relating to such matters as the definition of public bodies, the use of safeguard provisions, and the practice of zeroing in dumping margin calculations. Since it is obvious that the WTO cannot function effectively without some form of dispute resolution, agreement here is a sine qua non of the WTO’s rejuvenation. When President Trump, for example, invoked the WTO’s national security provisions to impose additional import barriers or export restraint agreements on steel and aluminium imports from a number of countries, this was widely seen as a violation of the spirit, if not the law, of the WTO. The retaliatory measures taken by most of the affected countries were not WTO consistent, at the very least in procedural terms. It is episodes like this, and the fact they are allowed to fester, that emphasize the need for robust and respected dispute settlement arrangements. In the meanwhile, a group of some 25 members have signed onto the Multi-Party Interim Appeal Arbitration Arrangement pursuant to Article 25 of the Dispute Settlement Understanding (MPIA). Initiated in April 2020, the MPIA is a temporary solution for a subset of the membership that wanted to have the possibility of availing themselves of an appeals process. By the end of 2021, however, no cases had reached the MPIA’s arbitrators. If the parties to a dispute do not agree to use the MPIA, a panel finding can be appealed into the void. Will the solution be to revert to the old consensus arrangement? This is unlikely to work in the way that it used to, where many, but not all, disputes calling for action by a respondent were acted upon in accordance with panel findings. Members are arguably too far apart and diversified in their interests and priorities today for the old system to operate with a comparable degree of effectiveness. A solution therefore is most likely to be found through a better system of checks and balances than has prevailed so far. It is too early to say whether such an accommodation will be forthcoming in the foreseeable future. 4.2 Development and the Balance of Rights and Obligations in the WTO Issues surrounding the appropriate balance of rights and obligations among members at different levels of development have troubled the multilateral trading system since the beginning. Differences over claims of developing country status by certain members and entitlement to special treatment have frequently slowed and frustrated trade negotiations. Early manifestations of the problem concerned the product composition of trade liberalization efforts that began with the founding of the GATT. The thrust of early drives to lower tariffs and other border measures was selective from the outset, and generally excluded agricultural products and labour-intensive manufactures. Early attention was brought to this problem by the 1958 Haberler Report,10 which, among other things, noted that high tariffs on agricultural products and labour-intensive manufactures, and tariffs that escalated with the degree of added value were adversely affecting the growth and development of developing countries. The response to this on the part of developed countries was to introduce non-contractual preferential access to their markets for developing countries in lieu of MFN-based reductions in protection levels of interest to the latter. The unilateral nature of these preferences meant they were reduced or removed as beneficiaries became more competitive, and they were also often entailed with conditionality on non-trade matters such as labour standards and other public policy aspirations of concern to the preference providers. Tariff escalation and high tariffs thus persist in sectors key to development. At the same time, arguably as a quid pro quo for a flawed preference-based market access regime, in those early years developed countries tended not to press developing countries too hard to open their own markets. The arrangement has also built a constituency opposed to multilateral, non-discriminatory market-opening, arguing that the erosion of preference margins hurts the development prospects of the poorest developing countries. This ‘minimalist bargain’ based on transient preferences continues to blight the multilateral trading system and attenuate its contribution to the reduction of barriers to trade.11 From the late 1960s and 1970s onwards, as the GATT and subsequently the WTO became more concerned with non-tariff measures, the issue of differentiated rights and obligations was clarified and legally formalized, and regulatory issues became far more prominent in the mix. These arrangements were part of the results of the Tokyo Round (1973–1979) in the form of the 1979 Decision on Differential and More Favourable Treatment, Reciprocity and Fuller Participation of Developing Countries, also referred to as the Enabling Clause. The Enabling Clause replaced time-bound waivers from the most-favoured-nation (MFN) principle, making a permanent exception for tariff preferences. The same was done for non-tariff regulatory measures.12 This latter addition was important because another significant outcome of the Tokyo Round was the introduction of stand-alone non-tariff measure agreements based on existing articles of the GATT. They included agreements on technical barriers to trade, anti-dumping, subsidies and countervailing duties, customs valuation, and import licensing. Each of the agreements included special and differential treatment (STD) provisions for developing countries. These regulatory instruments were further developed in the Uruguay Round, and a number of other agreements were added. The main contention here is that a solution to the perennial debate about the balance of rights and obligations assumed by individual countries under the WTO would be significantly facilitated if an analytical distinction were to be made between market access and regulation. As alluded to above, all countries continue to maintain high tariffs in particular areas. No two tariff schedules are identical, and there is no presumption that all WTO members will eventually converge around tariff-free trade. In these circumstances, it is unclear what constitutes Special and Differential Treatment (SDT) in market access. Yet much of the underlying discussion about developing countries not pulling their weight in the WTO alludes to tariff levels and the degree of market openness. It would make more sense to treat market access as a matter for negotiation that implicates all members rather than as a pressure point aimed at developing countries in relation to SDT. An additional consideration supporting this argument is that the GATT/WTO has never been particularly successful at market opening. Industrial countries did, however, significantly reduce tariffs on some manufactured products during the GATT/WTO’s first 50 years.14 The GATT’s role here was largely one of coordinating liberalization decisions among countries who were not impervious to terms-of-trade concerns. Nevertheless, as already noted, these reductions were selective and largely excluded agricultural and labour-intensive manufactured products.15 In addition, there have been very few instances where developing countries have reduced MFN applied tariff rates on the altar of a multilateral trade negotiating round. The only exception to this general resistance is in the case of GATT/WTO accessions. This does not mean that trade liberalization has not occurred in developing countries. It has happened either unilaterally in terms of unbound applied rates, or under preferential trade agreements. In short, the WTO has not proven to be a particularly effective instrument overall for moving the needle on trade openness via the removal of tariffs.16 In this domain, perhaps the ideal role for the WTO would be to periodically meet to determine the degree to which national or preferential actions already in place could be consolidated under the WTO. This brings us to the other key rule-making role of the WTO, namely the writing of rules in the regulatory sphere. Here the WTO has been far more successful. The question, then, is how do regulatory issues play out in the STD debate? A useful document prepared by the WTO Secretariat17 has divided SDT provisions into a number of categories. These include: (i) bestendeavour (effectively non-justiciable) provisions that increase trade opportunities and safeguard the interests of developing countries; (ii) provide flexibility of commitments, action, and use of policy instruments; (iii) offer transitional time periods for implementation of commitments; (iv) offer technical assistance; and (v) provide additional special treatment for LDCs. The WTO Secretariat document identifies 183 such provisions in the Marrakesh Agreement Establishing the World Trade Organization (hereafter the WTO Agreement18). The transitional timeframes are self-executing in that they come to an end after a specified period. This leaves only the flexibility category that may include regulatory SDT provisions that can be exercised unilaterally by developing country beneficiaries. This category accounts for 44 of the 183 SDT provisions (24%) contained in the WTO Agreements. For the rest (excluding LDC-specific provisions), action is required by those granting the SDT. This delineates the scope for the possible opportunistic use of SDT provisions by undeserving developing countries. Focusing on the specifics in this way helps to reduce the SDT debate to manageable specificities and thus detoxify the discussion and find a solution. Rather than trying to define developing country status by reference to a number of quantitative metrics, as a recent submission by the United States has proposed,19 it may be better to allow development status designations to remain in the eye of the beholder, and focus instead on which countries use what measures. If this approach were to be adopted, a survey would be required of what is being used by way of regulatory SDT in each developing country. It is quite possible that many of the developing countries targeted for possible abuse of SDT are not in fact making use of these provisions. In this case, they could undertake not to do so in the future, and this would leave a much more manageable subset of SDT provisions upon which to focus in terms of their contested use. An alternative approach in future might be to fashion negotiated outcomes on rules in the way the Agreement on Trade Facilitation (ATF) was designed. The particular feature of the ATF relevant here is that members were invited to link their implementation timetables to their development capacities. This was done by establishing three categories under Article 14 of the ATF that specified implementation timetables for individual members. The first list (Category A) included measures each member would implement upon entry into force of the Agreement. Category B set a timeframe for implementation of further provisions, and Category C for the remainder whose implementation was conditioned upon receipt of required technical assistance. This arrangement is fully transparent, and enhances buy-in by making members individually responsible for defining their needs. The challenge for members is then to ensure compliance rather than disappearing down a bottomless rabbit hole to debate entitlement. A final note is warranted on the approach adopted to SDT in the General Agreement on Trade in Services (GATS). In this case, the starkness of binary positioning in terms of SDT is blunted. The expression SDT does not appear in the Agreement and the issue of developing country participation is couched in more general terms of appropriate progressive liberalization. Whether this is an effective approach, however

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