Appellate Body

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The Appellate Body of the World Trade Organization (WTO) is a standing body of seven persons that hears appeals from reports issued by panels in disputes brought on by WTO members. [1] The WTOAB can uphold, modify or reverse the legal findings and conclusions of a panel, and Appellate Body Reports, once adopted by the Dispute Settlement Body (DSB), must be accepted by the parties to the dispute. The WTOAB has its seat in Geneva, Switzerland.

Contents

The appellate body been termed by at least one journalist as "effectively the supreme court of world trade". [1] The body established a dispute mechanism that allowed states, regardless of their size and power, to enforce predictable market access or at the very least secure authorization to retaliate for harms. [2]

Since 2019, when the Donald Trump administration began blocking appointments to the body, the Appellate Body has been unable to enforce WTO rules and punish violators of WTO rules. [3] [4] [2] Subsequently, disregard for trade rules has increased, leading to more trade protectionist measures. [4] [5] The Joe Biden administration maintained the freeze on new appointments. [4]

History

The WTOAB was established in 1995 under Article 17 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU).[ citation needed ]

“A standing Appellate Body shall be established by the DSB. The Appellate Body shall hear appeals from panel cases. It shall be composed of seven persons, three of whom shall serve on any one case. Persons serving on the Appellate Body shall serve in rotation. Such rotation shall be determined in the working procedures of the Appellate Body.” [6]

Blocking of adjudicator appointments

In the 2010s, the United States began expressing opposition to the WTO and its Appellate Body. The Barack Obama administration began to veto new appointments to the body in 2016. When Donald Trump became president, he complained that the WTO was "biased against the US" and threatened to pull the U.S. out. [7] [8] The U.S. complained that China was too rich to continue receiving exemptions meant for developing countries, and believed the WTO's law enforcement was crippling the U.S. while enabling China's growth as a mercantilist superpower. [9] [10]

As Appellate Body members' terms continued to expire, the U.S. refused to approve any new appointments. [11] [12] [13] [4] By December 2019, the Appellate Body lost its ability to rule because it no longer had at least three judges, the minimum necessary to hear appeals. [14] The WTO dispute settlement mechanism has been paralyzed since. [15] [4] Without a functioning Appellate Body to make a final ruling, any case appealed to it is forcibly halted. [16] [17] As of April 2025, the WTO reported that 32 dispute panel rulings had been "appealed into the void", including 2 filed by the United States and 11 filed against it. [18]

Multiparty Interim Appeal Arbitration

In March 2020, the European Union and 15 other WTO members agreed to a Multiparty Interim Appeal Arbitration Arrangement (MPIA). [19] This gave access to an alternative appellate mechanism (arbitration as an appellate mechanism) while the Appellate Body is not functional. Its provisions mirror the usual WTO appeal rules and can be voluntarily used between any WTO members to resolve disputes. The European Commissioner for Trade Phil Hogan said: "This is a stop-gap measure to reflect the temporary paralysis of the WTO's appeal function for trade disputes ... We will continue our efforts to restore the appeal function of the WTO dispute settlement system as a matter of priority." [20] As of August 2023, the MPIA consisted of just 27 out of the 164 WTO members and had issued two rulings. [21]

A pool of ten arbitrators were announced on 31 July 2020 marking the operational start of the MPIA. The arbitrators appointed were José Alfredo Graça Lima (Brazil) Valerie Hughes (Canada), Alejandro Jara (Chile), Guohua Yang (China), Claudia Orozco (Colombia), Joost Pauwelyn (EU), Mateo Diego-Fernandez Andrade (Mexico), Penelope Ridings (New Zealand), Locknie Hsu (Singapore), and Thomas Cottier (Switzerland). [22]

Members

The following is a list of members of the WTOAB including their nationality and term of office. [23]

Current

There are currently no Members of the Appellate Body.

See Multi-Party Interim Appeal Arbitration for an alternative arrangement used by some WTO member nations and list of appointed arbitrators.

Previous

References

  1. 1 2 "WTO permits U.S. to use long-outlawed policy to calculate anti-dumping tariffs on softwood lumber". The Globe and Mail Inc. 9 April 2019.
  2. 1 2 Hendrix, Cullen S. (2025-04-10). "Why the (developing) world still needs the WTO | PIIE". www.piie.com.
  3. ↑ Hopewell, Kristen (2024). "The (surprise) return of development policy space in the multilateral trading system: what the WTO Appellate Body blockage means for the developmental state" . Review of International Political Economy. 31 (4): 1245–1270. doi:10.1080/09692290.2024.2303681. ISSN   0969-2290.
  4. 1 2 3 4 5 "How Trump Could Deal Another Blow to Already Hobbled WTO". Bloomberg News. 2023-09-04.
  5. ↑ "At WTO, growing disregard for trade rules shows world is fragmenting". Reuters. 2023.
  6. ↑ "WTO | Dispute Settlement Understanding - legal text". www.wto.org. Retrieved 2024-03-31.
  7. ↑ "Donald Trump threatens to pull US out of WTO". Financial Times. 2016-07-24. Retrieved 2023-01-28.
  8. ↑ "Trump attack on WTO sparks backlash from members". Financial Times. 2017-12-10. Retrieved 2023-01-28.
  9. ↑ "Why there's no referee for the trade war : The Indicator from Planet Money". NPR. 2025-03-19. Retrieved 2025-05-05.
  10. ↑ "Reform or die? If the US gets its way, the WTO might do both". POLITICO. 2023-05-09. Retrieved 2025-05-05.
  11. ↑ "Ending the WTO Dispute Settlement Crisis: Where to from here? | International Institute for Sustainable Development". www.iisd.org. Retrieved 2025-05-05.
  12. ↑ "U.S. blocks WTO judge reappointment as dispute settlement crisis looms". Reuters. 2018-08-27. Retrieved 2023-01-28.
  13. ↑ "Fears for global trade as Trump fires first shots to kneecap WTO". Financial Times. 2017-11-10. Retrieved 2023-01-28.
  14. ↑ "US shuts down WTO appeals court – DW – 12/10/2019". dw.com. Retrieved 2023-01-28.
  15. ↑ "The World Trade Organization: The Appellate Body Crisis | Scholl Chair in International Business | CSIS". www.csis.org. Retrieved 2023-01-28.
  16. ↑ "WTO faces crisis over settlement disputes unless Trump backs off". the Guardian. 2019-12-08. Retrieved 2023-01-28.
  17. ↑ Swanson, Ana (2019-12-08). "Trump Cripples W.T.O. as Trade War Rages". The New York Times. ISSN   0362-4331 . Retrieved 2023-01-28.
  18. ↑ "Amid Trump trade tensions, WTO remains crippled arbiter". France 24. 2025-02-04. Retrieved 2025-06-17.
  19. ↑ Parliament, EU. "International trade dispute settlement: World Trade Organisation Appellate Body crisis and the multi-party interim appeal arbitration arrangement" (PDF). European Parliament. Retrieved 15 September 2024.
  20. ↑ Rosario, Daniel (27 March 2020). "EU and 15 World Trade Organization members establish contingency appeal arrangement for trade disputes". European Commission. Retrieved 27 December 2020.
  21. ↑ Choi, Bowon (2023-08-11). "Three Years of the Multi-Party Interim Appeal Arbitration Arrangement: An Interim Evaluation of Arbitration as a Means to Appeal WTO Panel Reports". Kluwer Arbitration Blog. Retrieved 2025-05-05.
  22. ↑ "WTO - Singapore Ministry of Foreign Affairs" . Retrieved 27 December 2020.
  23. ↑ Appellate Body Members, WTO
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