World Trade Court

The world trade court is an appellate court of the World Trade Organization (WTO). However, the term is not accurate, because the World Trade Court is more like an arbitration body than a typical criminal or civil court. Also, the term World Trade Court has not yet come into common currency. There has been resistance in some quarters to using the term because it implies a move toward permanent institutionalization and because it cannot issue decisions that are enforceable legal opinions like those in domestic legal systems. The appellate body of the WTO was created to serve as a world trade court in order to aid the WTO in fulfilling its mission—to help producers of goods and services, traders, exporters, and importers conduct their business. This [Page 1989]means that its goal is to ensure just and equitable settlement to all disagreements on trade issues. The work of the appellate body is focused on facilitating the flow of trade between nations. Its major responsibility is to administer WTO trade agreements.

The WTO is headquartered in Geneva, Switzerland. It was created during the Uruguay Round (1986–94) of negotiations on global trade. It began operations on January 1, 1995. As of December 11, 2005, it had a membership of 149 countries. The WTO is the only global organization that applies the rules of trade between nations. It does this on the basis of WTO agreements that have been negotiated and signed as accepted agreements between the major trading nations of the world. The WTO's agreements have all been ratified by its member nations.

The WTO provides a forum for conducting trade negotiations. It handles trade disputes and monitors national trade policies. It also provides technical assistance and training for people from developing countries. Finally, it cooperates with other international organizations. In April of 1994 at Marrakech, Morocco, the Marrakech Agreement (often referred to as the WTO's founding charter) was signed establishing the WTO. The agreement created a mechanism for resolving international trade disputes.

A Dispute Settlement Body (DBS) composed of representatives from all member governments was created. The DBS administers the Understanding on Rules and Procedures Governing Settlement of Disputes (DSU). If a member state believes that another state is engaging in unfair trade practices, then it can bring the dispute to the DBS. A dispute settlement panel composed of three persons who are trade officials will hear a dispute. They meet in secret to avoid political pressures, and their decisions are binding. A state that chooses can appeal a ruling of a panel to the World Trade Court. If a member state appeals to the World Trade Court, then it must do so on the basis of points of law and not on the basis of new evidence or over a dispute about findings of the dispute settlement panel.

The World Trade Court was established by Article 17 of the DSU. It is a permanent body composed of seven persons. They hear appeals from reports issued by the dispute settlement panels. The appellate body can, after reviewing the case, confirm the decision of the original dispute settlement panel, modify its report, or even reverse it. After the appellate body has issued its decision it will be reviewed by the dispute settlement body. The DSB has to accept or reject the appellate body's decision, which will then be binding upon all parties to the case. While binding upon the parties to the case, the WTO does not have an enforcement mechanism. Compliance is voluntary or and requires moral or political persuasion by the parties concerned or by the international community. The appellate body is a standing body also of seven persons and has a permanent seat in Geneva, Switzerland. Members serve four-year terms. The members are chosen for their recognized expertise in law and international trade. They may not be official members in service of any government.

...