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WTO Dispute Settlement: a Check-up


Edited By Jacques H.J. Bourgeois, Marco Bronckers and Reinhard Quick

The dispute settlement system of the World Trade Organisation has been referred to as the jewel in the crown of the WTO. Reviewing more than
twenty years of the system’s operation, this volume takes stock by providing an in-depth analysis of key issues that have emerged. The book collects and updates papers by a group of eminent experts that were presented at an international conference at the College of Europe in Bruges. The fundamental question of whether the system is in good shape or whether changes are necessary is addressed through five themes.

Firstly, the book looks at the interpretive function of the dispute settlement system and questions whether rulings are capable of "gap-filling". Secondly, under the heading ‘Jurisdiction and Applicable Law’ we cover the thorny issue of how public international law can be integrated into the dispute resolution system. Thirdly, regarding problems associated with implementation, we ask whether the system ensures satisfactory compliance with its rules and rulings or whether financial remedies need to be added. Furthermore, through themes four and five we compare the WTO dispute settlement system with the dispute settlement system contained in the Free Trade Agreements, as well as the investor-state arbitration system (ISDS). We investigate how these two different systems can influence each other and learn from one another. With respect to the reform debate on ISDS, for example, the question was raised whether the WTO dispute settlement system could be considered as a model for such a reform.

This review comes to the conclusion that the system is functioning, if not perfectly, at least reasonably well. Where problems are identified, solutions are suggested to improve the system.

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Strengths, Weaknesses, Opportunities and Threats of Investor-State Dispute Settlement as Compared to WTO Dispute Settlement (Freya Baetens)


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Strengths, Weaknesses, Opportunities and Threats of Investor-State Dispute Settlement as Compared to WTO Dispute Settlement


I. Introduction

For centuries, individuals who had been injured by a foreign State and who wished to see that State being held responsible had to rely on the system of diplomatic protection, defined as “invocation by a State, through diplomatic action or other means of peaceful settlement, of the responsibility of another State for an injury caused by an internationally wrongful act of that State to a natural or legal person that is a national of the former State with a view to the implementation of such responsibility”.2

However, the exercise of such diplomatic protection was a discretionary right of the State, not a right of the injured individual, who, as a result, had to persuade its home State to sue the foreign State for the violation of its obligations. This system had its obvious downsides, ranging from the fact that it fell entirely within the political appreciation of the home State to decide whether to espouse the claim, to the loss of control over the claim and its potential settlement, and finally to the lack of any obligation on the part of the claimant State to share any eventually-obtained compensation with the injured individual.

By contrast there is no equivalent to diplomatic protection in the World Trade Organization (WTO) dispute settlement system. Although the immediately injured parties of...

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