The WTO is under threat. With Members from both the Pacific and the Atlantic region poised to conclude preferential trade agreements, and the real possibility that the Bali Ministerial Meeting of 2013 will not produce at least a face-saving conclusion of the DDA due to a lack of political will, the Director-General elect of the WTO has joined the growing club of skeptics regarding the future of the WTO.
One important function of the WTO, however, is better served than ever, it seems, by the institutions set up in the WTO Agreement: the function to settle, through a unique adjudication process, the trade disputes between its members. While the shortcomings of the WTO dispute settlement mechanism have extensively been dealt with by the literature and the Members (too long, too expensive, not sufficiently attuned to developing countries, too activist, too powerful, too Appellate Body-centred, not enough deference to Members, and the list goes on), it is, overall, a resounding success. Developing countries and developed countries alike use it. Recently, even Cuba, not a frequent flyer in the world of international legal adjudication, joined the club of active users.
Thus, apart from the long-term perspective that dispute settlement will not continue to thrive if the WTO is indeed moribund (the actual exitus seemingly being too far away to make us really care), everything is good with the dispute settlement – isn't it?
That would be too good to be true. At least some dangers merit attention. One of them is at the heart of the research question Foltea's book tries to answer. Given that the WTO dispute settlement mechanism is, by far, the most successful and most law-centred dispute settlement mechanism of all quasi-universal treaty regimes, it becomes often the only authoritative adjudicative voice with regard to many aspects of international law, even though this law is not captured by the covered agreements which the WTO Dispute Settlement Understanding prescribes as the law to be applied by the WTO adjudicative bodies. Many Members, including major actors such as China and the US, have made abundantly clear that they are skeptical with regard to the life expectancy of the dispute settlement mechanism if the Appellate Body jurisprudence were to integrate too much (general) international law into the equation. While it is easy to show that the strong reactions of some Members to the announcement of the Appellate Body that the WTO legal order was not a self-contained regime has resulted in more self-restraint by the WTO adjudicative organs, the jurisprudence has nevertheless maintained that the WTO legal order is not operating in a legal vacuum.
It is unavoidable that the Appellate Body not only extensively relies on the general law of treaties, but also on substantive notions of public international law: in the reality of international relations and domestic policy making, trade concern and non-economic interests are not infrequently intertwined, making, for example, the non-WTO legal aspects suitable for being used as justification for the non-fulfilment of WTO law, or as evidence of satisfying a standard mandated by WTO law. The vehicles through which non-WTO law may be introduced into a WTO are many: apart from the terms used in exceptions (such as the general exceptions, the security exceptions and others), it is mainly the regular interpretative process in accordance with the general law on treaty interpretation as enshrined in the Vienna Convention on the law of treaties that permits and forces to draw on legal notions originating in the legal regime not directly related to the WTO system.
When the World Trade Court pronounces itself on general international law, this may be perceived as usurping powers it was not supposed to have and should not have. At the same time, Members may resent the use of law they may not have created and certainly have not allocated to the WTO dispute settlement mechanism for further clarification. The non-WTO international lawyers look with a mixture of envy and concern at what used to be the ugly sister of ‘real’ international organizations and treaty regimes and reproach the Appellate Body with being incompetent and insensitive to law that is not merchant-centred. This is where the importance of using the authoritative output of treaty regimes comes in. If the WTO uses what other systems produce, at least the latter concern of the general international law community should disappear like a picture of Dorian Gray.
Much to her credit, Foltea recognizes that less is more. She limits herself to a subgroup of interactions between WTO law, substantive and procedural, and other international law: the self-defined purpose of the book is to investigate the type and nature of interactions between the WTO and other international organizations in the context of WTO disputes (p. 16). In particular, she examines the interactions with the International Monetary Fund (p. 185), World Intellectual Property Organization (p. 199), World Customs Organization (p. 227), and World Health Organization (p. 245); and she examines in great detail and fully using the available state practice and literature the law and conventions of these organizations with regard to the WTO and its law, as applied in the dispute settlement mechanism.
Before engaging in this all-important stocktaking of organisational practice, the author lays the theoretical foundations for her exercise. She introduces the term sensitivity (which also appears in the title of the book) as a macro for the ability of the WTO to use legal sources outside of the covered agreements as input for adjucational decision-making (p. 23). By using the output of other institutionally developed international legal regimes when addressing legal questions related to these regimes, the WTO dispute settlement system (and by implication the whole WTO regime) benefits from higher legitimacy as it is drawing on the output of institutions established by the creators of that legal regime to determine, for example, what the law is, rather than substituting it. Foltea shows (p. 52), that the drafters of the WTO Agreement purposefully created target-specific interfaces with a limited number of other international organizations, most notably the IMF (p. 53), but also with WIPO, and certain standard-setting organizations (p. 60). However, going beyond providing an interface architecture with specific international organizations important for the future works of the WTO, the drafters provided for the possibility to create linkage by way of treaties between the WTO and other international organizations. Obviously, the drafters had taken notice of how diverse the international order had become, and how important it is to minimize, if at all possible, the friction between inter-related legal regimes. The author presents the use of these possibilities, and provides us with the first comprehensive stocktaking in that respect.
In a chapter that merits attention, not just by those who work on, with or in the WTO, Foltea analyses in great detail how the general law of treaties as reflected in the Vienna Convention can be used by WTO adjudicative bodies to create linkages with the world outside that covered by WTO agreements. This is a most useful research Exercise, followed by an elegant and convincing analysis of state practice in the context of WTO law, but is also most useful for anyone dealing more specifically with general treaty law, as Foltea fleshes out the different categories of interpretative tools mentioned as primary devices in Articles 31 and the secondary devices in Article 32 VCLT.
Foltea uses IMF, WIPO, WCO, WHO, and SPS standard setting organizations to examine the linkages between institutionally developed legal regimes. The book analyses in considerable detail all contributions of these organizations to WTO cases, thus offering researchers an excellent starting point for further research on how the dialogue between the WTO and its sister organizations and regimes takes place, and how the actors of international governance interact. In that context, the book explains that the reluctant use of outside law is not always just a function of well-developed egos of Appellate Body members and Member states keen to keep general public international law out of the multilateral trading system. Rather, it is from time to time also a function of the often surprisingly weak capacity of the institutional set-up of other regimes: this weakness refers to the ability to determine what the legal status quo is, but also to transparency, substantive standards for decision-making, and the ability to deliver reciprocal treatment of WTO law.
Foltea's insights are clearly of use beyond the realm specifically explored. By transcending the world of scholarly theories and introducing the reader to the workings in the machine rooms of state practice, concepts like ‘fragmentation’ or ‘coherence’ receive more precision and analytical usefulness. In providing us with this advancement, Foltea delivers a significant contribution to WTO and public international legal scholarship. We would hope for more from where this came.
