Structural Reform of the WTO THOMAS COTTIER THIRD SINGAPORE-WTO POLICY DIALOGUE ON THE WORLD TRADING SYSTEM FOR SENIOR GOVERNMENT OFFICIALS FROM ASIA AND THE PACIFIC "THE WTO: 20 YEARS AND BEYOND" OCTOBER 19/20, World Trade Institute Berne1

The Common Law of International Trade RTAs all structured on the basis of WTO law disciplines Shared values and principles Core legal concepts of tariffs, QRs, non-discrimination (national treatment) and exceptions Structure of agreements follow WTO law WTO-plus and sometimes WTO-minus Complementary functions of WTO and PTAs Multilateralization of main plurilateral PTAs in the dialectical process in coming decades World Trade Institute Berne2

Future Negotiations Due to decline of MFN, market access negotiations will continue to take place in preferential fora and settings WTO Members need to focus on USPs of multilateralism and related Organisations: –Multilateral Know-how and expertise of the WTO –Trade Community in Geneva and NGOs –NTB areas with de jure and de facto MFN and spill-over effects: Conditions of competition (subsidies, IPRs, competition policy, investment, labour standards) Technical regulations, food standards, domestic regulation of services World Trade Institute Berne3

Farewell to Trade Rounds With market access (tariffs, QRs) and services dealt with mainly preferentially, the rationale for trade rounds no longer exist Instead: Sectorial negotiations and on-going quasi legislative processes (building upon past experience: Financial Services, Telecom, GPA, Access to Essential Drugs) Integrated approach based upon global value chain analysis covering goods, services, investment, competition, government procurement Built in graduation on basis of economic factors, in particular for LLDCs World Trade Institute Berne4

Potential Sectors Energy: –Agreement on Electricity (towards a global grid) –Agreement on Fossil Fuels Agreement on Extracted Minerals Agreement on Specific Services, e.g: –Civil Aviation –Maritime Transports –Disciplines on Economic Migration Need to develop close working relationship with specialised international organizations World Trade Institute Berne5

Horizontal Issues Trade Remedies for Goods and Services (unfair competition approach) for dumping and subsidization Trade and Investment Trade and Competition Policy (Anti-trust) IPRs: Ceilings, Traditional Knowledge and CSR Trade and Human Rights (labour standards) Structural and Institutional Issues World Trade Institute Berne6

Structural Issues Within the flexible framework of WTO, what practices and structural reforms are needed to comply with the future tasks outlined ? –Negotiations and Cooperation with IO’s –Monitoring and Dispute Settlement World Trade Institute Berne7

Modifying Consensus Diplomacy The shift to PTAs is partly caused by rigidity within WTO talks Return to WTO talks requires more flexible attitudes Diplomacy should adopt consensus-minus as established under DSU and/or weighted voting Formally blocking consensus should be subject to vital interests, reasoned statements and need to confirmation upon cooling-off World Trade Institute Berne8

Monitoring Existing Agreements The evolution of the common law of international trade calls for stronger institutions beyond dispute settlement: Proactive role of the WTO Secretariat in monitoring existing agreements –TPRM (review frequency of reviews) –Dispute Settlement: –A voice for the Secretariat and enhanced transparency –Guardian of the system: right to lodge consultations and complaints against failing members Professional panel chairs and enhanced career options of staff within dispute settlement system World Trade Institute Berne9

Towards a World Trade Court From Fragmentation to Coherence –Art. 3.2 DSU and the status of non-WTO law in dispute settlement –The status of dispute settlement in Preferential Trade Agreements –Expanding the jurisdiction of the WTO to Preferential Trade Agreements –Institutional implications and cost structures World Trade Institute Berne10

Conclusions Focus on sectorial negotiations, graduation, plurilateral agreements and critical mass approach for MFN based rules Expand cooperation with other International Organizations Qualified consensus in negotiations Need to strengthen central institutions, in particular WTO dispute settlement: extending jurisdiction to RTAs World Trade Institute Berne11

Thank you for your attention The Common Law of International Trade and the Future of the WTO, 18 Journal of International Economic Law 3-20 (2015) World Trade Institute Berne12