WTO Dispute Settlement System: Collapse and Prospects

At the 12th Ministerial Conference in June 2022, WTO ministers agreed to engage in talks to address concerns about the dispute settlement system, with a view to ensuring a fully operational system by 2024.

What is this system? WTO members can raise disputes when they believe their rights are being violated with respect to any agreement contained in the Uruguay Round Final Act that is subject to the Understanding on Rules and Procedures Governing the Dispute Settlement Understanding (DSU).

The General Council meets as the Dispute Settlement Body (DSB) to deal with disputes.

However, the DSB is empowered to establish dispute settlement panels, adopt panel and Appellate Body reports, monitor the implementation of recommendations and rulings, and authorize the suspension of concessions and other obligations in the event of non-compliance with such recommendations and rulings.

Dispute settlement system

According to a WTO report, WTO members filed eight requests for consultations, the first stage of the dispute settlement process, in 2022, compared with nine in 2021.

By the end of 2022, a total of 615 disputes had been initiated under the DSU since the WTO was established in 1995.

Nine panel reports were circulated in 2022. The Dispute Settlement Body (DSB) adopted two panel reports during this period.

Two decisions and two arbitration awards were distributed during the year.

At the end of December 2022, panel proceedings were ongoing in 18 disputes.

Members continued to submit proposals on the implementation of the Appellate Body selection process.

The last proposal, circulated in September 2022 by Mexico on behalf of 127 members, was considered by the DSB at its meetings until the end of 2022.

However, in the absence of consensus, the seven Appellate Body seats remained vacant and no appeals could be heard.

Indonesia submitted a notice of appeal in 2022. As of December 31, 2022, 25 appeals were pending before the Appellate Body.