Law of World Trade

Law of World Trade

Spring Term 2014

Republic of Brand Newland is a developing country, and a WTO Member. WealthyLand is a much bigger developed country, and also a WTO Member. To protect its ailing steel industry from import competition, the WealthyLand, imposed a quota on imports of steel from the Republic of Brand Newland (RBN). The Government of RBN decides to challenge the “WTO consistency” of this quota and intends to put its request for the establishment of a panel on the agenda of the next meeting of the DSB.

WealthyLand’s Permanent Representative to the WTO received instructions from his Government to block or to delay the establishment and composition of a panel. The Permanent Representative of RBN received instructions not to accept any delay in the process of establishing and composing the panel. Her Government insists that the panel include five members of whom at least one is a national of RBN and two are nationals of other developing country Members. Among the five panelists, it wants two economists specialized in the economic development of developing countries. None of the panelists should be a former or current Geneva diplomat or a former or current official of the WTO Secretariat. The instructions of the Government of RBN are not to agree to a panel the composition of which does not meet these “requirements”.

Five weeks after the Panel has started its work and shortly before it is to receive the first written submissions of RBN, the lawyers of WealthyLanddiscover that the spouse of one of the panelists has shares in a holding company that has invested in a steel company established in RBN. They also discover that a few years ago another panelist had written a “scholarly” article on one of the legal questions at issue in this dispute.

In its first written submission, RBN requests the Panel to examine not only the quotas on steel but also quotas on cement that were recently introduced by WealthyLand. RBN also wants the Panel to find that the quotas on steel are not only in breach of Article XIX of the GATT 1994 and the Agreement on Safeguards (as it had stated in its panel request) but also in violation of the Agreement on Import Licensing Procedures. Finally,RBN calls upon the Panel to examine whether the imports of steel from RBN did indeed cause or threaten to cause serious injury to the domestic steel industry of WealthyLand. On the contrary, WealthyLand wants the Panel to rule only on the consistency of the quota with the Agreement on Import Licensing Procedures

FirmMetal, the largest steel producer in WealthyLand, NASP, the National Association of Steel Producers of WealthyLand and Fair Deal, a non-governmental organization that focuses on the problems of developing countries, have all sent to the Chairman of the Panel an “amicus curiae”brief. The brief of NASP had been published in the Financial Times and the Wall Street Journal a week earlier and had received a lot of attention.

RBN argues in its first written submission that the Panel should interpret the provisions of the Safeguard Agreement in the light of the object and purpose of the WTO Agreement and in the light of the alleged intention of the negotiators to limit the use of safeguard measures. After the second substantive meeting with the Panel, RBN submits to the Panel a 100-page document on the Uruguay Round negotiations, which it claims supports its position.

RBN argues before the Panel that since the introduction of quotas is inconsistent with the basic prohibition of quantitative restrictions set out in Article XI of the GATT 1994 and that Article XIX of the GATT 1994 therefore constitutes an exception to a basic prohibition, the burden is onWealthyLand to demonstrate that it has acted consistently with its obligations under Article XIX of the GATT 1994.

At the request of RBN, the Panel provides in its Working Procedures that RBN, in recognition of its status of developing country Member, may bring new claims until the first substantive meeting with the Panel. The Panel also decides that, in view of the complexity of the matter, the time frame for the panel process will be 20 months from the date of the composition of the Panel. WealthyLand challenges the first decision, RBN the second.

Questions that are being asked:

1. i. Does RBN act in accordance with the DSU by immediately requesting the establishment of a panel?

2. ii. Can the DSB refuse to establish the panel? What can the Permanent Representative of RBN and WealthyLand do?

3. iii. What steps, if any, can WealthyLand undertake as to the constitution of the Panel?

4. iv. How should the Panel react to these demands by RBN and WealthyLand on Agreement on Import Licensing Procedures?

5. v. What should the Panel do with the “amicus curie” briefs?

6. vi. What can the Panel do about the 100-page Uruguay Round document?

7. vii. On whom does the burden of proof rest in this dispute?

8. viii. Should the Panel revoke one or both of these decisions?

Discuss the legalities of the actions taken by both parties to the dispute, and advice the Panel, as it would like to get the advice of a number of eminent world trade law scholars on the issue.

Instructions:

1. i. Use the OSCOLA Style to reference your work

2. ii. The word limit for the work is set at 2500 [excluding footnotes]

3. iii. You are to provide a word count declaration in your work

4. iv. Your arguments are to be supported by appropriate case laws journal articles and practitioner works

5. v. Your work is to be submitted in duplicate, and separate copy is to be submitted electronically (through moodle).

6. vi. All assignments are to be handed in at 16:00 hrs by Friday 20th June 2014 to the office

7. vii. Acts of plagiarism will not be tolerated and will be reported to the Disciplinary Proceedings Committee on Academic Dishonesty & Malpractices

8. viii. Your assignment is part of your assessed coursework and failure to hand-in your work at the prescribed date/ time can affect your final result