Establishment of international trade rules reasons:
1)elimination of trade-restrictive measures in national legal orders;
2) need for security and predictability of trade rules;
3) challenges presented by economic globalisation (environmental issues, consumer safety, labour standards, cultural identity);
4) achievement of a greater measure of equity in international economic relations.
ITO Charter
Havana Conference 1948
Complementarity with IMF and WB
No entry into force: USA didn’t support the
project anymore Congress controlled by
Republicans).
GATT 1947
The GATT 1947 contains substantive trade rules (most-favoured nation clause, national treatment, barrier to market access, subsidies and countervailing duties, antidumping etc.).
No entry into force provisional application as from 1st January 1948 adoption of a specific Protocol.
Birth defects of GATT 1947 (Jackson)
• The lack of a charter: no legal personality, no procedural and institutional structure;
• Provisional character of its application;
• Grandfather rights;
• Ambiguity and confusion about GATT’s authority.
Birth defects of GATT 1947 (II)
Very scant institutional structure (art. XXV GATT 1947):
- meetings of Contracting Parties (one State,
one vote; majority rule actual use of consensus method);
- decisions of GATT Contracting Parties and Panels reports.
The evolution from GATT to WTO
Lengthy Negotiating Rounds:
• failure of Tokyo Round: adoption of Plurilateral agreements, binding only on States which accepted them.
• Uruguay Round (1989-1994): success in creating a new multilateral organization
Marrakesh Final Act (1994)
- institution of the World Trade Organization and signature of the WTO Agreement
- creation of a Multilateral Trade Organization and modification of FOGS (functioning of GATT system)
- the single undertaking: Members of the Organization should be bound by all the agreements in the GATT system
Package of agreements annexed to the WTO Agreement
• Annex 1A: Multilateral Agreements on Trade in Goods GATT 1994 (incorporating GATT 1947 and legal instruments adopted by GATT Contracting Parties with reference to it) + agreements on specific matters;
• Annex 1B: General Agreement on Trade in Services;• Annex 1C: Agreement on Trade-Related Aspects of
Intellectual Property Rights;• Annex 2: Disputes Settlement Understanding;• Annex 3: Trade Policy Review Mechanism;• Annex 4: Plurilateral Trade Agreements.
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