Study On The Effect Of WTO Panel Reports And Appellate Body Reports

The WTO dispute settlement mechanism has been in operation for a full 20 years since its establishment in 1995. As a significant product of WTO, the dispute settlement mechanism offers a good solution platform for trade disputes among WTO members. During the last twenty years, there have been more than 480 cases brought to the dispute settlement body to be solved. As panel and appellate body are two core dispute settlement procedures, panel reports and appellate body reports represent the rulings of the cases. The central content of this thesis is to study the effect of panel reports and appellate body reports.This thesis first explains the question that whether dispute settlement reports have "precedential" effect always get attention, and then summarizes the opinions from scholars in China to show most of the scholars acknowledge that the reports have "precedential" effect. At the same time, this thesis analyzes the opinions from foreign experts and scholars, it also concludes that dispute settlement reports have "precedential" effect actually. As the study of the effect of panel reports and appellate body reports helps to clear predictability and stability of the dispute settlement mechanism, this thesis mainly discusses in two ways, the effect to specific cases and whether there exists "precedential" effect, it will view from the "precedential" effect trend of the reports, and focus on discussing the trend of "precedential" effect phenomenon.This thesis consists of three chapters besides introduction and conclusion.Chapter one gives a general overview of the WTO dispute settlement mechanism, it introduces some basic theories of the dispute settlement mechanism. This chapter is divided into two sections. Section one not only analyzes the characteristics of the dispute settlement mechanism, but also summarizes the four procedures(consultation, panel, appellate body, enforcement process) and the application of law in dispute settlement. As the application of law in WTO relates to whether the sources besides WTO rules can be applied, it concerns whether the explanation in panel reports and appellate body reports can be bound to WTO members, this part foreshadows the discussion about the effect of dispute settlement reports in the following thesis. Section two mainly introduces panel in the way of the application requirements to the establishment of panel, the selection criteria of panel members, and the panel working process and time schedule. The section then introduces appellate body in the way of power and duties of appellate body, the scope of judicial review and working rules of procedure.Chapter two is about the effect of panel reports and appellate body reports, it constitutes the core part of the whole thesis. This chapter contains two sections. Section one discusses the effect to specific cases by panel reports and appellate body reports, it demonstrates the legally binding effect to disputing parties from the theoretical point of view, and then considers from the roles and rights of third parties who have substantial interests in the cases in the dispute settlement mechanism, it finally affirms the existence of influence of the reports to third parties. Moreover, through the analysis of strict time requirement, supervising and urging procedure, compensation and retaliation in WTO dispute settlement mechanism, this section certifies the compulsory enforcement to the case results provided by the dispute settlement reports. Section two starts a discussion with whether panel reports and appellate body reports have "precedential" effect, the purpose of the section is to prove the dispute settlement reports have no "precedential" binding effect legally, but have "precedential" directing effect practically. To prove the reports have no "precedential" effect legally, it explains the conception of "precedential", and takes the International Court of Justice as an example to illustrate the principle of stare decisis does not exist in international law, it also analyzes the law of WTO and the reports of international practice. To prove the reports have "precedential" effect practically, it discusses from the frequency of the reports cited and discovers that the following reports often cite the opinions in the previous reports, it also debates a few specific cases and mentions the experience of appellate body members.Chapter three continues the discussion of "precedential" effect in chapter two, it constitutes an important part of the whole thesis, as it introduces the trend of "precedential" effect phenomenon. This chapter is divided into four sections. Section one mainly analyzes three WTO cases, Japan-Taxes on Alcoholic Beverages case, India-Patent Protection for Pharmaceutical and Agricultural Chemical Products case and United States—Anti-Dumping Measure on Shrimp from Ecuador case. The three cases reflect that more and more reports recognize the "precedential" effect of the dispute settlement reports, and the "precedential" effect trend is hard to stop in WTO practice. Section two further demonstrates the practical basis of the trend, it mainly provides the practice of quoting previous reports in most cases and allowing third parties to join the cases as proof. Section three briefly explains the practical significance of the "precedential" effect trend, and it in fact introduces the positive effect of the trend. It includes not only maintaining the unity of dispute settlement rules, enriching the connotation of WTO rules and keeping the stability of WTO legal system, but also increasing the enforcement of the dispute settlement reports, raising the dependence of WTO members on reports and enhancing the predictability of case results. Section four discusses the negative effect of the trend, it may have a certain degree of damage to the regularity of WTO legal system, impact the sovereignty of WTO members and infringe the interests of WTO members. At the same time, China as one of the WTO members, the principle of stare decisis does not exist in the country, as the "precedential" effect trend of the dispute settlement reports emerging, China may have some challenge in its law system and international practice.