WORLD TRADE ORGANIZATION

Why in News?                                                                                                        

At the Working Session on Dispute Settlement (DS) Reforms, at the World Trade Organization’s 13th Ministerial Conference on 28 February 2024 in Abu Dhabi, India emphatically called for the restoration of the Appellate Body as the top-most priority of any reform process, along for effective formalisation of the ongoing informal dispute settlement reform discussions among some Members at the WTO. During the Working Session, WTO Members noted that the Appellate Body – the appellate arm of the DS system – had been non-functional since December 2019, due to the blocking of appointment of its Members by the United States. This had called into question the WTO’s overall credibility and the rules-based trade-order it upholds.

What is World Trade Organization?

• WTO is an international organization set up in 1995 by replacing the General Agreement on Trade and Tariffs (GATT) under the Marrakesh Agreement.
• It is the only global international organization dealing with the international Trade between nations.
• Its HQ is located in Geneva, Switzerland. Currently, WTO has 164 members and India is a founding member of WTO.
• The highest authority of the WTO is the Ministerial Conference, which must meet at least every two years.

WTO APPELLATE BODY

• The Appellate Body, set up in 1995, is a standing committee of seven members who presides over appeals against judgments passed in trade-related disputes brought by WTO members.

Countries involved in a dispute over measures purported to break a WTO agreement or obligation can approach the Appellate Body if they feel the report of the panel set up to examine the issue needs to be reviewed on points of law.

• Existing evidence is not re-examined; legal interpretations are reviewed.
• The Appellate Body can uphold, modify, or reverse the legal findings of the panel that heard the dispute.
• Countries on either or both sides of the dispute can appeal.
• The WTO’s dispute settlement procedure is seen as being vital to ensuring smooth international trade flows.
• The Appellate Body has so far issued 152 reports. The reports, once adopted by the WTO’s disputes settlement body, are final and binding on the parties.