The WTO Dispute Settlement System

Abstract

This article argues that a major aim of the Uruguay Round of GATT was to strengthen its dispute settlement procedures and such efforts resulted in bringing about significant improvements in the WTO dispute settlement system. It upholds the right of initiating a panel process by a complaining government and thus prevents blocking at that stage. It also establishes strict timetables for processing disputes and makes all decisions binding unless the DSB votes unanimously to overrule them. If the defendants fail to comply, the WTO can authorize the complainant to impose retaliatory trade sanctions. However, the system is not without weaknesses as the recommendations of the DSB are not implemented promptly and it is still reliant in important respects on the consent and initiative of the parties to the dispute. Although provisions on dispute settlement are generally seen as positive by the developing countries, including Pakistan, many face the challenge of finding the financial, as well as human, resources to participate in the WTO's dispute settlement proceedings. Securing compliance from a defaulting country, especially if it is a developed country, to the dispute settlement of the WTO also remains a major problem. The article concludes that in a general analysis, the dispute settlement system of WTO has been used by both developed and developing countries, despite having some procedural and functional weaknesses mainly due to the lack of a mechanism at the WTO to implement its decisions.