Technical note: stages in WTO dispute settlement

Calendar by Andreas Lischka via Pixabay CC0

This technical note accompanies
How the WTO deals with problem trade measures—it’s not just dispute settlement”,
A bit of bother down at the WTO court — Why? And is it a killer? Long read” and By Christmas 2019 the WTO was supposed to be dead — why wasn’t it? A short explanation

By Peter Ungphakorn
POSTED APRIL 30, 2021 | UPDATED APRIL 30, 2021

‘The system is based on clearly-defined rules, with timetables for completing a case. First rulings are made by a panel and endorsed (or rejected) by the WTO’s full membership. Appeals based on points of law are possible. However, the point is not to pass judgement. The priority is to settle disputes, through consultations if possible.”

Understanding the WTO

How long does it take to settle a WTO legal dispute?

These approximate periods for each stage of a dispute settlement procedure are target figures — the agreement is flexible. In addition, the countries can settle their dispute themselves at any stage. Totals are also approximate.

60 daysConsultations, mediation, etc
45 daysPanel set up and panellists appointed
6 monthsFinal panel report to parties
3 weeksFinal panel report to WTO members
60 daysDispute Settlement Body adopts report (if no appeal)
Total = 1 year(without appeal)
60-90 daysAppeals report
30 daysDispute Settlement Body adopts appeals report
Total = 1y 3m(with appeal)
Source: WTO, “Understanding the WTO
And in more detail

These, more precisely, are the stages. The times are approximate, based on the rules (the Dispute Settlement Understanding), but complex cases often last longer (also in pdf format).

WTO dispute settlement flow chart adapted from “Understanding the WTO”.
WTO dispute settlement flow chart adapted from “Understanding the WTO
Click the image to see it full size, or download pdf

One point that is often misunderstood is about countries blocking the creation of a panel. When a country that is complained against blocks a panel being set up, this is sometimes reported as a politically significant move. In fact it is routine and happens in almost every dispute that reaches the panel stage.

The rules allow the panel’s establishment to be blocked in the Dispute Settlement Body (DSB) once — it requires a positive consensus (no objections) to be set up. At the next meeting (and second request) the panel is set up because to block it would require consensus.

This is how the WTO explains it:

“Establishing panels is one of the functions of the DSB and is one of the three situations in which the decision of the DSB does not require a consensus. In the first DSB meeting in which such a request is made, the responding Member can still block the panel’s establishment, as was the case in the dispute settlement system under GATT 1947. At the second DSB meeting where the request is made, however, the panel will be established, unless the DSB decides by consensus not to establish the panel (i.e. the “negative” consensus rule applies (Article 6.1 of the DSU)). This second meeting usually takes place around one month later, but the complainant can also request a special meeting of the DSB within 15 days of the request, provided that at least ten days’ advance notice of the meeting is given (footnote 5 to Article 6.1 of the DSU).”

In the Dispute Settlement Understanding, the meaning is not obvious from way this is written:

1. If the complaining party so requests, a panel shall be established at the latest at the DSB meeting following that at which the request first appears as an item on the DSB’s agenda, unless at that meeting the DSB decides by consensus not to establish a panel.

The first meeting after the request has been submitted in writing is not mentioned at all. By default, the decision to establish the panel at that first meeting would be by normal consensus, so the country facing the complaint can block consensus.

Then comes “the DSB meeting following that at which … etc”, ie, the second meeting. At that meeting establishing a panel can only be rejected by consensus (“negative consensus”), which is unlikely since it would require the country calling the panel to be set up to turn around and join consensus to block it.

Updates: June 30, 2021 — Correcting an error in the chart (panel establishment is Art.6, not 4), adding the section on blocking panels
Photo credit: Calendar | Andreas Lischka, Pixabay, CC0