Twelve members of the World Trade Organization (WTO), including the European Union, are seeking to engage the United States on a reform of the Appellate Body.
The EU continues to work to modernise the WTO, but also to enable it to continue to function (see EUROPE 12098). The dispute settlement function of the multilateral organisation is indeed under threat, as the appointments of its Appellate Body (AB) have been blocked for the past year and a half by the United States (see EUROPE 11885).
However, Washington does not propose any solutions to this situation. The EU and eleven WTO member countries - Australia, Canada, China, Korea, Iceland, India, Mexico, New Zealand, Norway, Singapore and Switzerland - have therefore taken the lead in making a proposal to respond to five US grievances against the AB. The European Commission unveiled this proposal on 26 November.
First, the text clarifies the cases in which an AB member may have its mandate extended to allow it to close ongoing proceedings.
Secondly, any late AB report, set at 90 days, is only binding for the settlement of a dispute if the parties have explicitly agreed to it.
Secondly, the text seeks to further narrow the scope of the AB's case law. The body's opinions would not extend to matters of internal order in the member countries ('overreaching'). And the AB would confine itself to "only address issues necessary to resolve the dispute".
Finally, the text proposes that an annual meeting be held between WTO and AB members to openly discuss these and other issues.
The Trump Administration is not the first to complain about what is seen across the Atlantic as an overrun of its mandate by the AB. However, one European official admitted it: US grievances against the Appellate Body do not seem to be shared by other members.
A second proposal, submitted jointly with China and India, aims to increase the independence of the AB, in particular by limiting the term of office of its members to a single, longer term - eight years - and increasing the number of judges to nine.
These proposals will be officially submitted to the Organisation's members on Wednesday, December 12. (Original version in French by Hermine Donceel)