CYIL vol. 9 (2018)

VIKTORIIA LAPA CYIL 9 ȍ2018Ȏ the same time, it sparked the debate about an appropriate model of governance to ensure the WTO legitimacy: whether it is constitutionalization or global subsidiarity. 59 The WTO could be described is ‘continuing’ or ‘living’ instrument 60 not only in terms of its structure but in terms of its membership as well. As of June 2018, the WTO consists of 164 states, while in 1949 there were only 23 states. 61 With the growth of the number of the Members, the negotiations have become more contentious. Moreover, changes in relations among WTO Members were considerably affected by major shifts in the relative positions of other founding members of the GATT. 62 Moreover, having joined the WTO, China gained a powerful role in the organization as well. 63 Second, the dispute settlement system has been transformed from the diplomatic forum to the “quasi-judicial” system where the disputes are decided by Panels and Appellate Body which provide the structured legal reasoning in their reports. 64 The WTO dispute settlement system has been praised for its features and achievements not just to solve the trade disputes between two states, but also to provide certainty to other Members. 65 The problems notwithstanding, 66 the WTO has more tools to solve the trade conflicts than were available during the GATT period. If the WTO was to be considered “the crown”, its dispute settlement could be the “jewel in the crown”. 67 Last, but not least, the rules for adoption of the Panel report have been changed. 68 In particular, as the Panel report could be modified by the Appellate Body and is subject 59 See, for example, HOWSE, Robert andNICOLAIDIS, Kalypso ‘EnhancingWTOLegitimacy: Constitutionalization or Global Subsidiarity?’ (2003) 16 Governance 73. 60 FOOTER, Mary E. ‘The WTO as a “Living Instrument”: The Contribution of Consensus Decision-Making and Informality to Institutional Norms and Practices’ in Thomas Cottier and Manfred Elsig (eds), Governing the World Trade Organization (Cambridge University Press 2011) accessed 11 August 2018. p. 217. 61 As of 29 June 2016, according to the WTO website, ‘Understanding the WTO: The Organization, Members and Observers’ . As to the democracy and foreign policy conditionalities for joining the WTO see DAVIS, Christina L. and WILF, Meredith. ‘Joining the Club: Accession to the GATT/WTO’ (2017) 79 The Journal of Politics 964. 62 He points out the decline of Quad countries (Canada, the European Union, Japan and the United States) and rise of emerging economies (Brazil, China, India, Indonesia, Malaysia, Mexico, South Africa and Turkey) which made the relationships more quarrelsome and complicated than it had been the case in the GATT period. See VANGRASSTEK, Craig. The History and Future of theWorld Trade Organization (World Trade Organization 2013). 63 On China’s rise at the WTO see SHAFFER, Gregory and GAO, Henry. ‘China’s Rise: How It Took on the U.S. at the WTO’ [2018] University of Illinois Law Review 115. 64 For a concise historical overview of the WTO dispute settlement system see DAVEY, W. J. ‘The WTO and Rules-Based Dispute Settlement: Historical Evolution, Operational Success, and Future Challenges’ (2014) 17 Journal of International Economic Law 679. For an overview of the transition from the GATT to WTO dispute settlement system see REICH, Arie. ‘From Diplomacy to Law: The Juridicization of International Trade Relations’ (1997) 17 Northwestern Journal of International Law & Business 775. 65 Porges (n 32). p. 131. 66 As to the effectiveness of the WTO dispute settlement system see. ARIE REICH, ‘The Effectiveness of the WTO Dispute Settlement System: A Statistical Analysis’ (European University Institute 2017) EUI Working Papers Law 20177/11 . It was noted that the judicialization in some cases may provide more “drag” than lift. GREENWALD, John D. and FISCHER FOX, Lynn. ‘The WTO’s Emphasis on Adjudicated Dispute Settlement May Be More Drag than Lift’ (2007) 24 Arizona Journal of International and Comparative Law 133. 67 LAMY, P. ‘WTO Disputes Reach 400 Mark’ . 68 For example, Article 6(1) of the DSU states that “after the period of consultations, the complaining party can

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