Long-time U.S. trade lawyer, government official, and former WTO DDG Alan Wolff has a recent Peterson Institute working paper entitled "Restoring Binding Dispute Settlement." Here's the abstract:
Binding dispute settlement, meaning the ability to obtain a final judgment of whether a Member of the World Trade Organization (WTO) has acted inconsistently with its obligations, was the defining attribute of the WTO as created in 1995. Global commerce thrived on having the certainty provided by its taking place within this system. For well over a decade, the United States had complained that the dispute settlement system was undermining the trade remedies—antidumping, countervailing duties against subsidies, and safeguard actions against injurious imports—that were allowed under the WTO’s rules. When a populist US administration assumed office in 2017, it blocked appointments to the WTO’s Appellate Body. Today, the WTO dispute settlement system has become balkanized. The European Union and a number of other countries have banded together to put into place an alternative mechanism. Outside this system are the other two-thirds of the WTO Members, including the United States. For most WTO Members, no definitive result can be reached as to whether WTO obligations have been violated, as there is no assurance that WTO dispute settlement will be binding for them. The question addressed in this paper is how to reconstruct a system that the United States could join that would be broadly acceptable to others. The paper sets out a wide range of elements for negotiators to consider to rebuild the WTO dispute settlement system and make WTO agreements enforceable once again.
The paper has a good overview of the origins of the WTO DS crisis and the various issues that have been discussed as part of it. I thought Alan's table at the end of the paper with "a menu of elements for a possible negotiation leading to restoring an appellate stage to which all WTO Members might ultimately agree" was useful. The elements listed, he explains, are from the Walker Principles; his discussions with colleagues at the WTO, Ambassadors, members of their delegations, officials in capitals, past AB members and staff, and expert observers; and the current literature on this subject.
I did want to clarify one point though. In footnote 54, he says:
Simon Lester suggested an alternative to the DSB addressing overreach. He would have the General Council or a Ministerial Conference vote (three-quarters of Members required to carry an issue) on whether the reasoning (not the result of an individual report) was in error, thus making law. The problem with voting is the difficulty or ease of getting enough votes—that is, an unpopular position might not carry, while a popular but erroneous position might do so. Nevertheless, this is a recognition that the Members have to rediscover their legislative (rulemaking) power and reassert it. The question is how best to do it. This approach could be combined with the DS Review Committee recommended above.
To be clear, I didn't really expect to see voting here. In the blog post of mine that he links to, I said:
Rather than have partial adoption of a panel or Appellate Body ruling, as suggested by the United States and Chile, parties to the dispute could identify reasoning in a report that they found problematic. Identifying this reasoning would not have any impact on adoption or implementation of the findings in the particular case. Instead, it would trigger a process of discussion for an Article IX:2 interpretation. Achieving such an interpretation would be a challenge, and cannot be expected to happen easily. However, in the meantime, the amended DSU would state explicitly that the particular reasoning that was identified as being of concern would not serve as persuasive authority for future disputes.
I don't object to voting in these circumstances, but I agree with Alan that it will be a challenge to take a vote of this sort. What I had in mind with this suggestion is that we allow adoption to take place, while notifying the membership that there is a disagreement on the interpretation, and put that disagreement up for discussion. If an interpretation can resolve that disagreement, that's great, but even if it cannot, the dispute itself has been passed to the next stage and the discussion of the disagreement is valuable (and flagging it as not persuasive in future cases could help alleviate concerns related to "overreach," "activism," etc.).
Alan also had some follow-up thoughts on all this here.
