WORLD TRADE ORGANIZATION

WORLD TRADE ORGANIZATION

The World Trade Organization (WTO) is the principal international organization governing world trade.

It was established in 1995 as a successor institution to the General Agreement on Tariffs and Trade (GATT) which was a post-World War II institution.

WTO has 153 member countries, representing 95% of world trade

Head quarters Geneva , SwitzerlandCreated in uruguay round negotiation (1986-1994)Members 153

Goal is to improve the welfare of the peoples of the member countries.

AIM OF WTOIt aims to provide fair and stable conditions for the conduct of international trade with a view to encouraging trade and investment that will raise living standards worldwide.

WTO is a forum where countries continuously negotiate exchanges of trade concessions to further lower the trade barriers all over the world.

Current director general(Head)Pascal lamy

Decisions within the WTO are made by member countries, not by staff and by consensus, not by formal vote.

High-level policy decisions are made by the Ministerial Conference, which is a body of political representatives (trade ministers) which meet at least every two years.

Operational decisions are made by the General Council ( representative from each member country) which meets monthly and chair rotates annually.

DECISIONS

GATT came into force in1948 with 23 founding members.

It was intended to promote nondiscrimination in trade among countries, with the view that open trade was crucial for economic stability and peace.

Different trade rounds were held so as to liberalize the trade.

GATT(General agreement between trade and tariff)

GATT and WTO Trade Rounds

1st Round - Geneva in 194723 Countries participatedDecided to cut 45,000 trade tariffs

2nd Round - France in 194913 Countries participatedProposed further reductions in 5,000 tariffs

3rd Round - Britain in 1950-5138 Countries participatedProposed further reductions in 8,700 tariffs

4th Round - Geneva in 1955-5626 Countries participatedProposed to Cut Custom Tariffs with a total value of US$2.5 bn

5th Round - (Dillion Round) in Geneva in 1960-6226 Countries participatedProposed to cut 4,400 tariffs covering US$.9 bn worth of trade

6th Round - (Kennedy Round) in Geneva in 1964-6762 Countries participatedDecided on substantial tariffs reductions on all industrial productscovering US$40bn of trade.

7th Round - (Tokyo Round) in Geneva in 1973-79102 countries participated

-Customs cuts averaging 20% to 30% covering US$300 bn- Improved framework for subsidies, customs rates and technical obstacles to trade.

8th Round - (Uruguay Round) started in Uruguay ended in Morroco 1986-94123 countries participatedThe round led to the creation of WTO, and extended the range of

trade negotiations, leading to major reductions in tariffs (about 40%) and agricultural subsidies, an agreement to allow full access for textiles and clothing from developing countries, and an extension of intellectual property rights.

9th Round - (Doha Round) started - in Doha in 2001 ( at forth Ministerial Conference)- in Cancun in 2003 (at fifth Ministerial

Conference)- in Hong Kong in 2005 (at sixth Ministerial

Conference)- in Geneva in July 2006 (at seventh Ministerial

Conference Not yet concluded.

141 countries participated, Subject covered are tariffs, non-tariffs measures, agriculture,,,

environment, competition, investment, transparency, patents, etc.

OBJECTIVES

Trade without discrimination To set and enforce rules for international trade,To provide forum for negotiating and monitoring the international tradeTo resolve trade disputes,To increase the transparency of decision-making processesTo cooperate with other major international economic institutions involved in global economic managementTo help developing countries benefit fully from the global trading system.

FUNCTIONS OF WTOWTO shall facilitate the implementation, Administration and operation of the plurilateral trade

agreement.

WTO shall provide a forum for the negotiation among its members concerning their multilateral

trade relations

WTO shall administer the understanding on rules and procedures governing the settlement of

disputes

WTO shall administer the trade policy review mechanism and

WTO shall co operate as appropriate with IMF AND IBRD and with the affiliated agencies

WTO administers the 28 agreements contained in the final act and the no of plurilateral

agreements and the government procurement through various councils and committees

It oversees the implementations of issues related to tariff cut an non tariff measures agreed to in

the trade negotiations

It examines the trade regimes of the individual member countries

WTO provides dispute settlement courts and panel

It acts as a management consultant for world trade

It provides technical co-operations and training

It can be used as a forum for continuous negotiations

It co-opts with the international institutions like IMF,IBRD etc for making

global economic policy

And it oversees the national trade policies of member governments.

It oversees the implementations of issues related to tariff cut an non tariff

measures agreed to in the trade negotiations

PRINCIPLES OF TRADING SYSTEM

First Principle: Non-discriminationSecond principle: Free TradeThird principle: Fair trade

9th Doha Round (started in 2001): Agriculture, Services, TRIPS (Trade-Related Aspects of Intellectual Properties)

The WTO discussions should follow these fundamental principles of trading.

1. A trading system should be free of discrimination in the sense that one country cannot privilege a particular trading partner above others within the system, nor can it discriminate against foreign products and services.2. A trading system should tend toward more freedom, that is, toward fewer trade barriers (tariffs and non-tariff barriers).3. A trading system should be predictable, with foreign companies and governments reassured that trade barriers will not be raised arbitrarily and that markets will remain open.4. A trading system should tend toward greater competition.5. A trading system should be more accommodating for less developed countries, giving them more time to adjust, greater flexibility, and more privileges.

MEMBERSHIP

Country wishing to join submits an application to the general council and has to describe all the aspects of trade and economic policies that have a bearing on WTO agreements.Application is examined by the working party open to all interested WTO members. Working party determines the terms and conditions of entry into the WTO for the applicant nation . Final Phase – bilateral negotiations between the applicant nation and other member countries regarding the concessions and commitments on tarrif levels and market access for goods and services.After talks, working party sends to the ministerial conference on accession package.Once the general council or ministerial conference approves of the terms of accession, the applicant's parliament must ratify the Protocol of Accession before it can become a member.

MINISTERIAL CONFERENCES

The topmost decision-making body of the WTO. It meets every two years. The Ministerial Conference can take decisions on all matters under any of the multilateral trade agreements. The inaugural ministerial conference was held in Singapore in 1996. The second ministerial conference was held in Geneva in Switzerland. The third conference in Seattle, Washington ended in failure.

MINISTERIAL CONFERENCES

The fourth ministerial conference was held in Doha in the Persian Gulf nation of QatarThe Doha Development Round was launched at the conference and it is upto date running. The fifth ministerial conference was held in Mexico.The sixth WTO ministerial conference was held in Hong Kong from 13-18 December 2005. The seventh WTO ministerial conference session was held in Geneva from 30 November-3 December 2009.

Agreement on Agriculture

Agreement on Textiles & Clothing (ATC)

Agreement on Subsidies and Countervailing Measures

Agreement on Anti-Dumping

Agreement on Safeguards

Agreement on Trade Related Investment Measures (TRIMs)

Agreement on Custom Valuation

Agreement on Technical Barriers to Trade (TBT) and on Sanitary and Phytosanitary Measures (SPS)

Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS)

General Agreement on Trade in Services (GATS)

Understanding on Dispute Settlement (DSU)

Special & Differential Treatment ( S& D )

WTO Agreements

The Uruguay Round agreementsThe Agreement establishing the WTO

Its AnnexesAnnex

1A - GATT 1994 , related agreements (e.g. Agreements on Agriculture, Subsidies etc.) and texts

1B- General Agreement on Trade in Services (GATS) and Annexes

1C- Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS)

Annex 2 Understanding on the Rules and Procedures Governing the Settlement of Disputes (aka Dispute Settlement Understanding /DSU)

Annex 3 Trade Policy Review MechanismAnnex 4 Plurilateral Agreements (e.g. Agreement on Trade in Civil Aircraft)

TRIPS AGREEMENT

Of these agreements, Trade-Related Aspects of Intellectual Property Rights (TRIPS) is expected to have the greatest impact on the pharmaceutical sector and access to medicines.In becoming Members of the WTO, countries undertake to adhere to the 18 specific agreements annexed to the Agreement establishing the WTO. The TRIPS Agreement has been in force since 1995 and is to date the most comprehensive multilateral agreement on intellectual property. The TRIPS Agreement introduced global minimum standards for protecting and enforcing nearly all forms of intellectual property rights (IPR), including those for patents.International conventions prior to TRIPS did not specify minimum standards for patents.

PATENT PROTECTION The TRIPS Agreement requires WTO Members to provide a patent protection for a minimum term of 20 years from the filing date of a patent application for any invention including for a pharmaceutical product or process. Prior to the TRIPS Agreement, patent duration was significantly shorter in many countries. For example, both developed and developing countries provided for patent terms ranging from 15 to 17 years, whilst in certain developing countries, patents were granted for shorter terms of 5 to 7 years.The TRIPS Agreement also requires countries to provide patent protection for both processes and products, in all fields of technology.

KEY PROVISIONS OF TRIPS