Introduction
For a long time, humans have always looked for a way to exchange what they have for what they want, which was beneficial for both parties. The exchange of goods and services between people of different areas and regions leads to trade development. The mode of trade that was first adopted back then was barter trade which involved the exchange of goods for other commodities of equal value. Trading among communities led to economic growth and development, creating strong relations among communities. Over the years, many changes and development occurred in the trade that necessitated it being governed and regulated to promote development and reduce disputes among members. The World Trade Organization (WTO) is among the organizations developed to regulate international trade. Its main purpose is to create trade rules applied globally to enhance better relations between nations.
WTO acts as the only established and recognized body that deals with developing global trade rules. It ensures that all activities of trade run smoothly as possible by maintaining fairness and impartiality of the highest level. The established trade rules are of great importance since they help provide stability and assurance, thus fostering prosperous economies in the world (Bhala 2015, p124). This organization ensures an open trading channel for exchanging goods and services, facilitating consumer and producer satisfaction. WTO also reduces disputes among its members by finding nice ways to settle disputes by ensuring all members conform to established policies and guidelines. Finding appropriate solutions to disputes significantly lowers trade barriers among countries and reduces the chance of disputes brewing into political or military conflict. To ensure that the welfare of all WTO members is improved, various agreements and laws are developed to enhance transparency and stability in trade.
World Trade Organization Trade Law
WTO plays a crucial role in maintaining the integrity and effectiveness of trading activities among countries. Various agreements and laws have been established to promote trade and better relations among and between various countries. These agreements cover services and commodities and the integrity of intellectual properties. Trade laws established by WTO point out the margins of permitted exceptions and the allowed principles of liberalization (Bossche & Zdouc 2017 p112). WTO trade laws ensure all member countries commit to lowering the rate of custom tariffs that tend to act as barriers to effective trading and provide procedures to be followed in cases of disputes. A recommendation was made that all emerging and struggling countries receive some kind of preferential treatment (Carr & Sundaram 2021, p323). This instance was achieved by compelling other nations to make appropriate changes to in their trading policies and regulations to accommodate these emerging countries. This is done as per the set WTO laws and guidelines.
WTO is considered a rule-based system due to the strict and thorough trade laws established by the organization. It is important to remember that the regulations are negotiated agreements and rules between two or more nations. The WTO accords is campaigned for and approved by a majority of the world’s trading economies (Chow & Schoenbaum 2017, p101). After approval, each member country has to vote for the law in their parliament before they agree on any policy and they tend to form the core of the trading system. These agreements act to serve as the legal underpinnings for international commerce. Essentially, they are contracts that provide crucial trading rights and privileges to WTO members. They also necessitate other member countries to maintain transparency, accountability and predictability in their trade policy thus promoting trade. The agreements create a stable and transparent environment for products and service producers, exporters, and importers to conduct business.
Global trade norms give security and stability among its members and neighboring countries. Consumers and producers know that they have more choices in terms of completed goods, services and raw materials (Chuah 2019). Producers, importers and exporters also know of the availability of the international market in order to enhance trade. This surety has made the world a more affluent and peaceful place to live in for it helps promote accountability. All the decisions made by WTO are arrived at after a consensus among members and confirmed by the members’ parliaments (Graafsma et al., 2018, p87). Any trade tensions that arise are directed to the World Trade Organization’s (WTO) dispute settlement team, whose main focus is to interpret treaties and provide amicable solutions to countries. The likelihood of conflicts escalating to a point of raising political or military concerns is greatly reduced. WTO applies various mechanism that aim to cut down any barriers between individual countries and trading economies by decreasing restrictions and set tariffs.
Irrespective of the fact that WTO is referred to as a free trade organization, this is not usually the case as there are external influences. Tariffs, regulations, checks and other types of limitations are allowed under the system, but only on restricted circumstances. To be more precise, WTO is governed by a set of norms that are devoted to maintain an open and fair market for all its members. Maintaining equitable treatment norms on non-discrimination ensure that trading conditions are fair (Graafsma et al., 2018, p123). Various complicated concerns are raised to with the aim of trying to establish the measure between what is to considered right or wrong. There exist many WTO accords that aim to improve various sectors including agriculture, proprietary information and attempt to promote fair competition. This benefit is mainly made possible by the numerous public procurement agreements that extend competition laws and guidelines to many of the government agencies.
Relation between WTO Laws and Domestic Laws
There is a two-way link connecting World trade organization laws and domestic law. The WTO legal system is influenced by the trade legislation that its members have produced over time. Currently, WTO antidumping standards result from more than a century of experience by WTO members using this tactic (Magklasi, 2018, p141). Members of the Uruguay Round negotiated new global guidelines, to which they pledged allegiance, based on their relevant experiences with their very own and foreign laws. Each Member is responsible for ensuring that its laws, rules, and administrative processes comply with the requirements set out in the attached Agreements.
WTO accords customary laws usually directly impact the United States’ domestic legal system. In its constitutional practice, the United States acknowledges the difference between auto and forced foreign treaties (WTO 2015). Agreements and major executive agreements can both be conscience and definitive, thus having an immediate impact as part of US internal and domestic law (Nirmal & Singh 2018, p122). It is necessary to study the wording of a treaty to determine if it is self-executing. A treaty is self-executing if the pact’s terms give effect that are direct. The agreement cannot execute itself if the clauses suggest that additional laws are required for a more direct and precise effect. Furthermore, certain treaty terms may be self-executing, while others are not. Multilateral trade treaties like the GATT have never been ruled to be self-executing in US law, and major experts agree that the GATT is not one of them.
To establish globally fair laws and regulations, different member countries met to discuss improving trading experiences forming a treaty called the Uruguay Round Agreement Act (URAA). The Uruguay Round Agreement Act offered various provisions to improve trade among its member countries. However, most of the provisions of the Uruguay Round Agreements tend to be inconsistent with some laws of the United States; hence various restrictions are laid down to avoid interference (Organization 2017). As a result of this restriction, the WTO accords have no direct legal impact in the United States. This rule also ensures that the Dispute – settlement Panel established by WTO and Appellate Body judgments have no direct impact on US law. The United States International Law Commission for Trade has also ensured that dispute and their settlement reports have no legal force in the United States.
This is because neither WTO agreements nor disputes resolution rulings may directly impact current US law. This is per the laws established by Congress of the United States after the World Trade organization and the URAA tend to have full force and effect in domestic legislation and US courts. This is usually the case regardless of whether or not they clash with WTO agreements. In the case of a dispute between the two, US courts have stated that certain US law takes precedence over international law. However, the US judiciary will not jump to this conclusion easily since they believe that legislation should not be understood to clash with international responsibilities unless specific wording to the contrary is present (Palmeter & Mavroidis 2018, p77). It is worth noting that the president’s power over foreign affairs reigns supreme in other state laws that can only be stop be an official grand jury thus avoiding laws that conflict with those of the United States. As a result, the US has taken a dualistic strategy to the World Trade Organization. The WTO provision is an executive agreement in the eyes of the US Constitution.
As the above indicates, the European Union and the United States have a complicated connection between their domestic laws and WTO law for quite different reasons. Neither acknowledges the direct impact of WTO agreements or Dispute Settlement Body judgments (DSB). Both countries require incorporating WTO rules into their domestic legal systems as a precondition for their globally legally binding Obligations to have internal validity. This is particularly true in the case of the European Union in general (Richards & Wto 2019, p231). This is except for the WTO Agreement, which permits people to use terms of international agreements even if the other contractual party does not reciprocate. Due to the established hierarchical placing of international treaties in the European Economic Community, has often resulted in ‘ordinary’ legislation being ruled illegal.
The agreement is a legally enforceable international duty for the US. However, it has no direct influence on the domestic judicial system. Its implementation is contingent on the US Congress enacting it into domestic law. Before a US tribunal, no individual claimant may raise any right of action or defense explicitly under Treaty provisions (Spackey 2018). As a result, legal challenges originating from WTO agreements in the United States will be determined under US law, including federal and state, despite the outcome as long as it is compliant with global laws. The president and Congress are responsible for ensuring that US and WTO legislation is in sync.
Application of WTO Trade laws
WTO provides fair trading grounds that ensure partiality and that no discrimination or what so ever occurs among the member countries. Under WTO rules and regulations, Countries should not discriminate each other on the basis of economic prosperity (Spackey 2020). If favor is shown to one party, such as a standardized customs tax rate on one of their item, this must be reciprocated among all the members of WTO. However, there are several limitations and exceptions For example, countries are allowed to establish a trade deal that applies solely to products exchanged internally among members with none form outside. Emerging and developing countries may be provided with a preferential rate for their markets to support their growth. Another alternatively that is used by the government include erecting trade barriers against items from certain countries deemed trade unjustly (Srivastava 2020, p84). Additionally, the governments are within its right to discriminate offering services under certain conditions. However, certain circumstances have to be met for these exclusions to be allowed. Principles established under the MFN indicates that a nation can only lower barriers to trade or open a market of its commodities to all its trading partners without preferential treatment. This also applies to countries that considered poor and impoverished.
After commodities have entered a market, they should be treated the same whether have been produced locally or imported from other countries. This principle of national equality and treatment that focuses on giving others countries equal treatment as one’s citizens is found in all three major Treaty provisions (Teehankee 2020). The only difference occurs in how things are handled in the various treaties. All goods, commodities and product rights receive national treatment once they hit the market thus enhancing equality. In this regard, levying customs duty on imported products does not violate fair and equitable treatment, whether equivalent tax is imposed on locally produced goods or not.
Reducing trade barriers is the surest way to enhance commerce among the member countries of WTO. Among the barriers that hinder effective trade include high trade tariffs and policies that impose restrictions on importation and exportation of goods (Trebilcock & Trachtman 2020). More often than not, various questions have been raised regarding the currency rate policy. If trading barriers are lowered, it will lead to creation of more job opportunities, foster better economies and ensure consumer satisfaction. This greatly helps to create stability, accountability and predictability in trade.
Sources of WTO Laws
Nations tend to be bound in their obligations once they agree to expand their operations and service delivery in the WTO. The main purpose of these binds is to act as the ceiling to set trading limits for member countries. This makes imports to be charged lower duties than products been exported although this mainly occurs in developing countries. In affluent and already developed countries, the custom rate is usually the same for both imports and exports. The binding holding a country with its members can only be changed after up front talks with its trading partners, which is then followed by compensation of lost commerce (UCL 2017). Among the Uruguay Round table accomplishments was allowing for expansion of the volume of commerce subject to binding obligations. Most products nowadays have tied tariffs including agriculture. As a result of having tied tariffs, most traders will receive a better level of market security. The system aims to increase predictability and stability in trading to ensure profitability and growth. Opposing quotas and other measures to limit the number of imports in a country can prove beneficial in promoting the economy of a country. Another strategy that can prove to be effective is ensuring that the established trade regulations are as transparent and direct as possible.
WTO accords are designed to urge member countries to reveal their trading practices and policies inside their own country publicly to hence promoting transparency and accountability. Panel findings and the Appellate Body’s reports, on the other hand, give an increasingly essential gloss to those passages (Valbrune, Assis & Cardell 2019). Most WTO conflicts will be settled mostly, if not entirely, by referring to the provisions and earlier reports. The WTO judicial power may be considered substantially independent in this regard. However, while the WTO law is mostly independent, it is far from complete (WTO 2015). It is, on the contrary, an integral component of the broader system of international law, as evidenced not only by the interpretive principles applied to its texts but also by its increasing reliance on other traditional sources of public international law. These international sources include customs, publicist teachings, principles of law, and other international bodies, particularly those incorporated by procedural law.
Conclusion
The importance of public international law to WTO legislation is undeniable. It is not apparent if the opposite would be true that other tribunals will start viewing the WTO as a source of law, as evidenced in its accepted reports. Given the increasing number and excellent overall quality of those findings, it is just a matter of time until this acknowledgment occurs, particularly concerning evidential and procedural concerns that might have a broader significance
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