Explaining the Standard of Review of WTO Dispute Settlement Body

دانشنامه حقوق اقتصادی

Article 6, Volume 25, Issue 13, April 2018, Pages 69-100   

Document Type: Scientific research

DOI: 10.22067/le.v25i14.63434

Authors

ali rezaei^* ; Milad Amiri

Shiraz

Abstract

Extended Abstract
General Council of WTO as the Dispute Settlement Body (DSB) has exclusive jurisdiction to settle disputes between WTO members. DSB works by Panels and Appellate Body and inevitably should review and investigate disputes. The question is that how DSB should review the measures and decisions of members for the settlement of disputes. Indeed, the main question raised here is about “standard of review”.
Within the Dispute Settlement system of World Trade Organization, whenever the DSB is called for reviewing the members’ measures or interpreting the laws and regulations, the issue of standard of review is raised. This issue explains how much deference should be granted by Panels and Appellate Body to national decisions. In other words, Should the Panels respect the findings of the national authorities and their decisions regarding the subject (total deference approach), or should they re-examine and review national measures and decisions completely and independently (de novo approach)?
De novo review and total deference are the two most common standards of applying appropriate level of deference. The first one entails an independent examination of the domestic measures and decisions; a policy of full de novo review allows the panel to completely substitute its own findings for those of the national authority and arrive at a different factual and legal conclusion. The standard of the review of total deference means that a panel should not review in substance the investigations conducted by the national authority. Under such policy, panels examine whether the relevant procedural requirements for the adoption of a measure or decision are complied with or not (Oesch, 2003).
The issue of standard of review is a large part of procedural law in general; it plays an important role in the judicial review of authorities’ measures in both domestic and international jurisdictions. However, standards of review do not only accomplish a procedural function; they also express a deliberate allocation of power between an authority taking a measure and a judicial organ reviewing it.
In legal framework of WTO, especially in the Dispute Settlement Understanding, there is no explicit standard of review clause. But it has been generally interpreted by the Appellate Body that the requirement to adopt an appropriate standard of review arises from Article 11 of the DSU which obliges a panel to make an objective assessment of the matter before it. It thus appears from the language of Article 11 that the Panels should make an objective assessment of the matter in carrying out their responsibility, including an objective assessment of facts of the case and the application of and conformity with the relevant covered agreements. This has been clarified by the Appellate Body in a number of instances. For example, in the EC – Hormones, the Appellate Body noted that in regard to the fact-finding by the Panels, the applicable standard of review is neither de novo nor total deference, but rather an objective assessment of facts. It is a general rule about the standard of review in dispute settlement system of WTO; however, the scope and intensity of the panel’s assessment is not the same for every issue and every dispute. Therefore, the nature and intensity of review (standard of review) differs depending on which kind of issues is being reviewed - Is the issue a question of fact or a question of law?. The nature of review also changes with the subject matter of the dispute. For example, the measure that is in question under the Anti-Dumping Agreement is examined with a different standard from a measure under Agreement on Sanitary and Phytosanitary Measures (Ehlermann & Lockhart, 2004).
In legal determinations (the question of law), de novo review of a national authority’s legal determination is necessary, because the panels and appellate body have duty to interpret the WTO agreements. It’s clear that preserving the WTO members’ balance of rights and obligations is subject to providing a uniform interpretation. For achieving this goal, panels and appellate body should conduct an original, de novo review of a national authority’s legal determinations.
Compared to legal determination, in factual determinations there is no need to a complete, original and de novo review. By looking at Appellate Body’s statements in different disputes, in factual determinations it appears that panels should accord a considerable degree of discretion to national authorities in the assessment of facts. In other words, panels should not seek to displace the national authority by doing their own factual investigation; nor should they reject factual findings by the national authority just for this reason that they prefer other findings.
Standard of review is different in specific WTO agreements as well as in legal and factual determinations. For instance, article 17.6 (i) of Anti-Dumping Agreement provides a specific assessment criterion for factual determinations. This article explicitly affords  a broad discretion to the national authority to assess the facts and events. According to this article, panel should respect the factual determinations of national authority provided that the process of establishing of those facts was "proper". The standard for legal determinations and the interpretation of provisions are referred to in article 17-6 (ii) of the Anti-Dumping Agreement. This clause is the only rule by which the panels are allowed to apply different interpretative rules to the WTO rules which are not covered by other agreements of the WTO. According to this clause, the panel should interpret the relevant provisions of the Agreement in accordance with the customary rules of the interpretation of public international law. It is possible that a relevant provision of the Agreement admits of more than one permissible interpretation; so if the authorities’ measure rests upon one of those permissible interpretations, the panel should find it to be in conformity with the Agreement (Jane, 2006). Some other agreements of WTO  have their own specific rules about standard of review which should be considered in relevant disputes.

Keywords

Objective Assessment; Deferential Review; Intrusive Review; Legal and Factual Determinations

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