In a statement at the Informal TNC and Heads of Delegation Meeting today, the United States said this about WTO dispute settlement:
On dispute settlement, the United States believes that Members must undertake fundamental reform if the system is to remain viable and credible.
The dispute settlement system can and should better support the WTO’s negotiating and monitoring functions.
To achieve real, meaningful reform, we cannot allow process to take precedence over substance. The United States does not believe it would be productive at this juncture to begin discussions on process before Members have an opportunity to engage with the United States and others on key fundamental, substantive issues.
We recognize that this is a priority for many Members. The United States will engage constructively with Members at the appropriate time. Our focus for the July Ministerial must remain on the fisheries subsidies negotiations.
I'm not exactly sure what the U.S. means by "we cannot allow process to take precedence over substance," but perhaps that just means no appointing of Appellate Body Members ("process") until the substance of this disagreement is resolved. In terms of the substance, what I think we need is for the U.S. to make some proposals. Will that happen? Based on the statement above, I'm feeling a bit optimistic and I'm going to predict that it will, but it may take a little while ("The United States will engage constructively with Members at the appropriate time" sounds more positive than some things that were said during the Trump administration.)
The U.S. also said this:
Regarding domestic support, the major obstacle in our view is that Members do not agree on the types of support to cut or who should cut.
Unfortunately, I think this explanation could be applied more broadly to many other areas of WTO negotiations.
ADDED:
The U.S. statement makes more sense now that I see the EU statement at the same meeting:
Finally, a top priority remains to find a lasting solution to the current Appellate Body situation that would restore a fully functioning dispute settlement in the WTO. WTO Members have a shared responsibility to resolve this issue as soon as possible. A fully functioning WTO dispute settlement system is critical for rules-based trade.
It is clear that important reforms will be needed. It is clear also that it would not be realistic to expect concrete outcomes or solutions by MC12.
However, a lack of any progress concerning one of the core functions of the WTO would cast doubt on the credibility of the reform agenda and of the WTO itself.
Our expectation would therefore be that we would converge by MC12 on a time-limited work programme to agree on a package of reforms of the WTO dispute settlement system. This process would focus on issues that need to be resolved to overcome the impasse over Appellate Body appointments. The objective would be to have a fully functioning Appellate Body within a defined time period (and in any event no later than by MC13).
Now it becomes more clear, I think, that the U.S. focus on "substance" over "process" is a reference to the EU's proposal for a "time-limited work programme." I'm not sure a time limited process would be that crucial here, although I do understand that negotiators see these as a way to make sure a negotiation gets wrapped up rather than dragging on forever. But in this situation, I think the key is for the U.S. to figure out a position and make a proposal. At that point, we'll have a better sense of when and whether a resolution is possible.
