The Trump Administration's Shameful Attack on Appellator Zhao
5 March 2020
Steve Charnovitz
On 5 February 2020, I posted a paper, <https://ielp.worldtradelaw.net/2020/02/the-illegitimate-ab-report-in-russia-railway-equipment-.html>, explaining why the Appellate Body's February 3 decision in Russia - Railway Equipment is illegitimate. The reason why is that two of the three appellators in that tribunal, Mr. Graham and Mr. Servansing, were serving under an extension of their terms pursuant to Rule 15 yet in violation of the terms of Rule 15. I further noted that the failure to follow the letter of Rule 15 had occurred under the chairmanship of Graham. Thus, the only legitimate member of the tribunal was Judge Zhao from China.
On 6 February 2020, the Appellate Body issued a report in US - Supercalendared Paper. The Appellate Body upheld the panel which found that the US government had committed multiple violations of WTO subsidy rules. I decided not to comment at the time, but this Appellate Body decision suffers the same invalidity as the Railway Equipment decision. Only one appellator, Zhao, was legitimately a member of the tribunal. The other two appellators, Graham and Bhatia, were both serving an extended term pursuant to Rule 15 and yet in both cases, the Rule 15 extensions were granted prematurely. Again, this flouting of Rule 15 was carried out by the Appellate Body under the stewardship of Graham. For both reports, Graham, while serving as chair of the Appellate Body, acted illegitimately to extend his own term on the division for a period following the pending expiration of his term. Clearly, Rule 15 does not allow an appellator to vote to extend himself (and his compensation) for a period after his departure as a full Appellate Body member.
Today, at the meeting of the WTO Dispute Settlement Body, the Trump Administration pointed out that the Supercalendared Paper decision was "not a valid Appellate Body report and represents the latest example of the Appellate Body’s failure to respect WTO rules." On that I agree. But I was surprised to see the main reason the Trump Administration gave for the invalidity was that Zhao "is not ... a member of the Appellate Body because she is not eligible under the DSU." Judge Zhao's alleged reason for ineligibility, according to the Trump Administration, is that she is affiliated with China's Academy of International Trade and Economic Cooperation.
Is this a serious objection? I hardly think so. Looking this evening at the Academy's website, it plainly says that "The Chinese Academy of International Trade and Economic Cooperation (CAITEC) is an inter-disciplinary and multifunctional social science research institution and a consultative body directly under the Ministry of Commerce (MOFCOM) of China." Yet the fact that she is part of an Academy sponsored in some way by China's government hardly makes her ineligible to be appointed to the Appellate Body. The only reasonable interpretation of the DSU Article 17.3 requirement that appellators be "unaffiliated with any government" is that the appellator cannot simultaneously be an official or an agent of a government.
The entire span of DSB practice shows that Appellate Body members will typically be individuals who have served as officials in governments and may be even retirees of those governments. Prior government service is not a disqualifier from being on the Appellate Body even though there may some ongoing affiliation. Service as a professor in a public university is also not a disqualifier nor is being a consultant to a judicial academy a disqualifier. I won't discuss individual names of former Appellate Body members, but a perusal of the list shows affiliations similar to what Zhou apparently has back home.
Nevertheless, following three pages of information about Zhao, US Ambassador Shea's paper asserts that none of this information was disclosed to the DSB when Zhao was named to the Appellate Body. Therefore, USTR concludes that "Ms. Zhao is not a valid member of the Appellate Body."
Plainly this conclusion is wrong, as USTR conclusions often are wrong. Zhao is a valid member of the Appellate Body because she was elected by consensus of WTO members on 1 December 2016. Whatever doubts WTO members may have had about Zhou's eligibility were resolved during the debate that led to her election by consensus.
Once an international judge gets elected, any attack on that judge by a government can only be viewed as an attack on the judicial independence of that judge. Indeed, the motivating factor behind the US attack on Zhao is made perfectly clear in USTR's statement today which argues that Zhou "participated in an appeal in which the conduct complained about related almost exclusively to China. And so, besides the invalidity of this individual to serve on the Appellate Body, their participation in this particular appeal is impossible to see as impartial."
While it is great to see the Trump Administration being so solicitous of avoiding conflicts of interest under DSU Article 17.3, I wish they were equally solicitous to obeying WTO rules regarding subsidies in Supercalendared Paper and in scores of other WTO cases against the United States that have been decided and that would be brought if the Trump Administration had not defenestrated the Appellate Body.
