SOME BASIC INTERNATIONAL LAW CONCEPTS

SOME BASIC INTERNATIONAL LAW CONCEPTS

The world trading system is based on international law, i.e. law regulating relationships among States

State’s equality and sovereignty Customary law Treaty law Acts of international organisations

SOME BASIC INTERNATIONAL LAW CONCEPTS

Custom: - non written - addressed to all States- made of practice and opinio juris - ex. prevention of environmental harm

SOME BASIC INTERNATIONAL LAW CONCEPTS

Treaty law- binding only upon contracting parties- difference between signature and

ratification - it prevails upon customary law - GATT and WTO are examples of treaty

law

SOME BASIC INTERNATIONAL LAW CONCEPTS

Acts of international organisations - IOs are created by a treaty among the parties wishing to join the IO- the IO can then emanate acts, binding upon members and subordinate to the establishing treaty- ex. the awards rendered by WTO judicial organs are acts of an IO

INTERNATIONAL TRADE TOOLSTariff obstacles (duties)Non tariff obstacles (quota) Tariff quota

Tariff can be ad valorem or on a specific basis- revenue for the State- protection of national industry

INTERNATIONAL TRADE TOOLS

Tariff binding Tariff peak (industrial products)Tariff escalationNuisance tariff

INTERNATIONAL TRADE TOOLSTrade defence measures:- dumping - safeguard measure - anti-subsidy measureBasic obligations:- most favourite nation clause - national treatment

HISTORICAL BACKGROUNDClassical liberalism - between industrial revolution (1750-1880) and

WW1- States do not intervene in economic relationships- “friendship, navigation and trade” treaties based

on MFN and NT- trade regulation only based on duty collection

HISTORICAL BACKGROUNDProtectionism (between WW1 and WW2)- State intervention in the economy to

reconstruct and to face the crisis- trade wars and economic autarchy - duties, anticompetitive practices and beggar-

thy- neighbour policies - bilateral treaties (quota)

HISTORICAL BACKGROUNDmanaged free trade (neoliberalism)- after WW2- economic freedom - set of rules guaranteed by States and IOs- delegation of power to IOs- erosion of domestic jurisdiction

THE BRETTON WOOD CONFERENCEcreation of the post-war economic ordercomplementing UN policy on peace and

securityIMF = int’l monetary stability and BOP

problemsIBRD (the WB group) = development projects ITO = trade- UN Conference on trade and labor (1946-1948)

THE WORLD BANK GROUP Int'l financing Corporation: loans to private

firms Int'l Development Agency: loands to LDCs

(long term, low rates) Multilateral Investment Guarantee Agency :

investment insurance Int'l Centre for the settlement of investment

disputes : arbitration procedure

THE ITO

ITO (not born) = trade regulation but also labour, competition etc

- UN specialised agency failure:- protectionism vs push for liberalisation - US vs UK- cold war- 1 State =1 vote

THE GATTsigned in Geneva in 1947 while the UN

conference is still going on tariff concessions provisional no institutional structureweaker than the Avana Charter

THE GATTlack of formal strengthbased on “rounds”tariff reduction vs technical obstacles “genuine” technical standards vs protectionist

onesexamples: procurement policies, subsidies,

custom valuation methods

THE TOKYO ROUND AND THE SEVENTIESTR focused on technical obstacles GATT “à la carte”confusion and free riding

The 70s: general recession and oil price shockrise of Japan and NICsprotectionism and managed trade (MFA)

DCs, LDCs, …difficult to distinguish different categories of

countries according to dev’t levelDCs & LDCstransition economies NICs and big DCsrole of UNCTAD in GATT/WTOtrade as a tool for dev’t

The Uruguay Round and the Marrakesh Agreement

1986- 1994the transition from GATT to WTOnew subjects (services)the single undertaking principle : end of free

riding and unity of the system plurilateral agreements

THE INSTITUTIONAL STRUCTURETraditional structure of IOs:- assembly or plenary- restricted organ- secretariatWTO structure- Ministerial Conference- General Council- Secretariat

URUGUAY ROUND AGREEMENTS

http://www.wto.org/english/docs_e/legal_e/legal_e.htm

THE INSTITUTIONAL STRUCTUREMinisterial Conference - all members - Ministerial rank of representatives- general competence - political guidelines about the development of

the organisation- meets every 2 years

THE INSTITUTIONAL STRUCTUREGeneral Council- all members- diplomatic rank- implementation of the MC decisions - interpretation of WTO legal texts- meets whenever necessary- DSB and TPR boby

THE INSTITUTIONAL STRUCTURE

Secretariat :- carries out the TPRM- provides technical assistance- cannot accept instructions by States- chosen by the DG

THE INSTITUTIONAL STRUCTUREThe Director General- chosen by the General Council- acts in its individual capacity - responsible of the budget- he represents the organisation in front of other

States- diplomatic role in negotiations

THE INSTITUTIONAL STRUCTUREevery agreement is managed by a Council - assessment of compliance - discussing future developments- GATT 1947 = GATT Council - SPS = SPS Council - but the GATT Council can intervene in other

councils’ issues

THE INSTITUTIONAL STRUCTURElack of tranparency and civil society

involvement participation of DCs and LDCs - green room negotiations- consensus techniquenon-trade issues actually the real problem now is the lack of

progressi in negotiations!

THE DOHA ROUND (2001 -???)big momentum in 2001 vs economic crisis industrial market access and agriculture big issues

blocking other issuesproliferation of bilateral agreements and regional

trading blocksDSS prevailing over negotiations protectionis moves (export bans, currency

manipulation, import obstacles)