Acknowledging the failure to engage Washington in reforming the World Trade Organization's (WTO) dispute settlement system, European trade ministers concede that an interim solution must be developed to prevent the Appellate Body from disappearing.
The ministers meeting in the EU Trade Council on Monday 27 May noted this: to date, European attempts to engage Washington both bilaterally and multilaterally have failed (see EUROPE 12262/12).
Indeed, for nearly 2 years, Washington has still refused to lift its veto on the appointment of new judges to the WTO's Appellate Body (AB). According to American diplomats, the failure of the AB to comply with the rules established by WTO members is at stake. However, they are not making any movement to reform its functioning.
But the urgency is there: on 10 December, with the expiry of the terms of office of two of the last three judges, the Appellate Body will no longer be able to carry out its functions. For the Union, it is essential to preserve both the binding nature and the two-level adjudication of the WTO. “We continue to support the Appellate Body”, EU Trade Commissioner Cecilia Malmström reminded the press after the meeting.
To this end, the European Commission has already approached, on a bilateral basis, trading partners to explore a mechanism based on Article 25 of the Mechanism's understanding of appeal on arbitration. It stipulates that the use of arbitration is conceived as an “alternative means of dispute settlement”, “subject to the mutual agreement of the parties which shall agree on the procedures to be followed”.
However, it is indeed an interim solution, several European sources have insisted. The EU will continue to actively advocate for the reform and modernisation of the multilateral organisation (see EUROPE 12098/8). “We will take all efforts not to give up”, said Jean-Baptiste Lemoyne, French Secretary of State to the Minister for Europe, on his arrival.
According to him, “there have been comments made about the problems with the functioning of the dispute resolution body”. He called for these messages to be taken “head-on” by continuing this work with the United States and other major trading partners at the G20 in Japan at the end of the month. (Original version in French by Hermine Donceel)