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Transcript
THE WORLD TRADE ORGANIZATOIN March 4, 2015--KUFS, Seoul, Korea Professor Sung-Eun Stephan Kim Prof. Sung-Eun S. Kim Law & Policy of International Trade Korea University of Foreign Studies Spring, 2015 THE WORLD TRADE ORGANIZATOIN Grades: 20% - attendance and class participation 40% - mid-term 40% - final A+ A B+ B C+ C D+ D F 12 11 11 12 7 2 1 1 2 Study Group 59 This is critical in learning the course material and this helps students prepare for the class as well as help digest the material after each class and prepare for the exams. 6-10 persons—submit group members and leaders by next week Meet 1-2 per week (once before class—e.g. Tuesday and also once after class—e.g. Wednesday) Are expected to answer questions on subject matters to be covered in class. Must look up terminologies and understand their meanings. Google search is a very useful tool. Use English to English dictionary when looking up words. 2 THE WORLD TRADE ORGANIZATOIN Bretton Woods and the failure of the International Trade Organization Conference on economic matters held in 1944 at Bretton Woods, New Hampshire After founding of UN in ‘45, 1946, resolution for forming the ITO Lake Success, Geneva, Havana—ITO Charter, Schedule of Tariff Reduction, GATT (General Agreement on Tariffs and Trades) ITO never made it because US Congress, controlled by Republicans (1948 election) failed to ratify it. ITO was dead. GATT remained and became a quasi organization. The GATT becomes an international organization The failure to adopt ITO—absence of the third pillar [IMF, World Bank, ITO] following IMF, World Bank. GATT, an agreement, ≠Org. contracting parties held annual meetings; new K parties could be added, But w/ birth defects: Lack of charter—no legal person, no set procedures GATT had only provisional application --grandfathering rights for domestic legislations in force at the time of accession to GATT that were inconsistent Ambiguity and confusion re: authority, decision making ability, legal status. 3 A summary of GATT obligations The rules are designed to assure that the tariff concessions work as intended and are not undermined. 1.National treatment of imports –taxes and regs. (Art III) 2. prohibition of quotas, import/export licenses and other measures—some exceptions (Art IX); and a special provision relating to quotas on movies (Art IV) 3. Guarantees of freedom of transit (Art V) 4. Rules relating to subsidies, anti dumping and countervailing duties (Art VI & XVI) 5. Rules on Valuation for customs purposes (Art VII) 6. Rules on fees and formalities connected with importation and exportation (Art VIII) 7. Rules on marks of origin (Art IX) 8. Rules on transparency and publication of national trade regs. (Art X) 9. Rules on currency exchange regs. (Art XV) 4 10. Rules on state-trading enterprises (Art XVII) 11. Rules on gov’t assist. to economic development (Art XVIII) EXCEPTIONS for: 1. Quotas for b-of-payment purposes (Art XII, XIII, XIV, XV, XVII, Sec. B) 2. developing countries (Art XVIII and Part IV) 3. emergency action where serious injury is caused or threatened to a domestic industry (Art XIX—”escape clause”) 4. health, safety, the protection of natural resources and other matters (XX) 5. National security (XXI) 6. customs unions and free trade areas (≈FTA of today) (XXIV) 7. waivers by the K-parties (XXV) 8. to opt out of GATT when a new K-party joins GATT (XXXV) 5 SETTLEMENT OF DISPUTE XXII (consultation) XXIII (provides for filing of complaint and permits GATT K-Parties to investigate and make recommendations—basis for GATT dispute resolution system at the foundation of WTO dispute settlement procedures. PROCEDURAL provisions: 1. modifying the Schedule for Concessions & conducting tariff negotiations. Withholding or withdrawing concessions if a state withdraws or fails to become a K party defining which countries can become a K party Amending GATT Withdrawal on 6 months notice Acceptance, entry into force and registration of the GATT 6 ANNEX—notes and supp. interpretations of various articles. GATT was modified and superseded in part by GATT 1994—one of the WTO Agreements—the original GATT is known as GATT 1947. GATT tariff negotiating rounds—8 rounds ‘47 through ‘94 Geneva—Annecy—Torquay—Geneva—Dillon—Kennedy (62-67)--Tokyo (73-79)—Uruguay (86-94) Early GATTs—reduction of tariffs; later, especially Uruguay rounds—reduction of non-tariff barrier. Immense new body of laws: basic texts of WTO agreements—400 pages. The one signed at Marrakesh, Morocco on April 15, 1994—26,000 pages. The final act of the U round transformed GATT into a full fledged org called WTO. 7 The creation of the WTO Uruguay Round negotiations wanted to avoid the Tokyo situation—many side agreements which were binding on only certain countries that signed onto them. A new WTO was suggested (Jackson)—with status of a UN special agency with an organizational structure and a dispute settlement system. Jan 1, 1995. WTO Agreement all agreement annexed to WTO Agmt became binding on all Members as a single body of law. Annex 1 A: Agmt on: Agriculture; Application of Sanitary and Phytosanitary Measures; Textile and Clothing; Tech Barriers to Tr; Trade Related Investment Measures; Art VI 1994 GATT Implementation (antidumping); Customs Valuation; Pre-shipment Inspection; Rules of Origin; Import Licensing Proc; Subsidies and Countervailing Measures; Safeguards. Annex 1 B: GATS (services) Annex 1 C: TRIPs (Intellectual Prop.) Annex 2: DSU (Dispute Settlement Understanding)—procedures for settling disputes 8 Annex 3: Trade Policy Review Mechanism Annex 4: Plurilateral Trade Agmts (Binding only on members who accepted): Trade in Civil Aircraft; Int’l Dairy Agmt; Int’l Bovine Meat Agmt But the last two were terminated in 1997. WTO Agmt formally replaced GATT 1947 The WTO: functions and structure 1. provides a forum for nego among members; administers the system of dispute settle; administers the Trade Policy Review Mechanism; Cooperates with IMF and WB 2 .governing bodies: Ministerial Conf & Gen Council MC—supreme authority reps of all Members meets at least every 2 years; GC—chief decision making and policy body btwn MC meetings. GC—composed of ALL members and discharges the responsibilities of DSB and Trade Policy Review Body 9 Special Councils and Committees report to GC (C for Tr in Goods, C for TRIPs, Councils have the power to create committees; MC also has the power to establish committees Secretariat located in Geneva—Director General presides over it— appointed by MC. Pascal Lamy Roberto Azevêdo Sep. 1, 2013 for 4 yrs. Membership, accession and withdrawal Countries join after negotiating terms of accession—must be approved by 2/3 or more of Members. Difficult and time consuming process e.g. China a series of bilateral market access agmts were required to be entered into with the U.S., the European Community 14 years. Nov 2001. (at Doha) Withdrawal 6 months notice. Decision-making General decision-making: by consensus and voting. Consensus, if no Member present at a meeting formally objects ≠ unanimity. If objection, formal voting. Greater than ½ present. 1 vote per member. ≠ IMF, WB, weighted vote. 10 Interpretations. Strict: only MC or GC has the power to adopt interpretation of WTO agmts by > 3/4 Waivers: of any obligations under WTO agmts; by > ¾, but subject to staged implementation or a transitional period, only by consensus. Subject to annual review extended, modified or terminated E.g., The Banana case: EC continue discrimination in favour of imports from Africa, Pacific, Caribbean; tariff pref to developing countries (including Latin Am) on a variety of other products. Agreed to replace discrim tariff-quota by1/1/2006. Amendments: very difficult: tabled 90 days + before submitted for acceptance. Certain provisions only by unanimous vote. MC, can decide whether all Members must accept it, and recalcitrant member must withdraw or remain a member w/ consent of MC 11 THE WORLD TRADE ORGANIZATOIN The WTO as an international organization WTO Agreement created WTO as a new int’l legal organization Suggestions for improving the WTO Decision making, too cumbersome: solution, creation of an “Executive Body.” (GDP, share of world trade, population; assure representation by developing countries, a geographic balance; permanent v. rotating members. A weighted voting system. Needs to be more externally transparent. Webcasting Increased public access to WTO documentation Extended use of the WTO website. (www.wto.org) Improved dialogue through the allocation and use of budget 12 Invitation to non-gov’t bodies to annual WTO meetings as observers, written submissions; conduct a series of dialogues among Members, academics, the media, and NGOs. Creation of a mechanism for parliamentary input into int’l trade policy debates, meetings among parliamentarians Ad hoc non-binding advisory boards made up of experts ≈ APEC, WIPO, OECD. Current Work: The Doha Development Agenda WTO 160 members and 23 observer states (+ Vatican) as of June 26, 2014. (New: Russia, Laos, Tajikistan, Vanuatu, etc.). (Consider: UN has 193 member countries and there are 206 countries claiming independent sovereign statehood.) Korea — GATT K-party (April 14, 1967); signed Marrakesh WTO Agreement and became a Member (April 15, 1994). Doha Development Agenda, (started in 2001 in Doha, Qatar) behind schedule; failed to reach agreements by 2007, 2008. Trade in agricultural products Non-agri trade issues 13 Commitment for trade in services Trade facilitation issues (cutting red tapes and customs formalities) Developing countries and trades Trade and environmental protection EU. US, Japan v. G20 (India, Brazil, China, S. Afr) Cancun, Mx, 2003 —Korean farmers & fisheries pres. Kyung Hae Lee commits suicides HK 2005, related meeting in Geneva, Paris, Geneva Sugar, cotton, rice, dairy 4 biggest subsidized crop/agri in the US. Next Class: March 13, 2015--Chapter 4 Dispute Settlement 14