Journal of International Economic Law - current issue

East Asian Free Trade Agreements in Services: Key Architectural Elements

Fink, C., Molinuevo, M. — 2008-05-21

Since the mid-1990s East Asian countries have negotiated 25 free trade agreements (FTAs) with a services component. There are important architectural differences in these agreements, which ultimately affect their value in promoting transparency, fostering the credibility of trade policies, and advancing market opening in services. This article reviews key architectural choices, focusing on the approach towards scheduling commitments, the treatment of investment and the movement of natural persons, rules of origin, provisions for the settlement of trade dispute, and selected deeper integration issues. In doing so, it assesses the advantages and drawbacks of different architectural approaches and discusses a number of lessons learned.

A Pirate of the Caribbean? The Attractions of Suspending TRIPS Obligations

Ruse-Khan, H. G. — 2008-05-21

On 21 December 2007, arbitrators in the US – Gambling dispute awarded the Caribbean Island State Antigua and Barbuda the right to retaliate against the United States of America by suspending obligations under the WTO Agreement on Trade Related Aspects of Intellectual Property Rights with an annual value of US$ 21 million. Given the asymmetries in market size and economic power, this scenario serves as the perfect case study for testing claims that suspending intellectual property protection is a legal and feasible option for developing countries and small economies in disputes with their larger trading partners. I argue that it can do a significantly better job than traditional retaliation in achieving the re-balancing purpose as well as the objective of inducing compliance. The relevant DSU rules further do not raise real hurdles for cross-retaliation. However, its main attraction lies in the potential to generate positive welfare effects: If implemented wisely, suspending TRIPS obligations can create temporary policy space for designing the domestic intellectual property regime in a way which facilitates technological development and domestic innovation through imitation and technological learning. In this case, the publicity ‘WTO authorized piracy’ is likely to generate might actually put a spotlight on normative flaws within the global intellectual property regime.

Bilateralism in Services Trade: Is There Fire Behind the (Bit-)Smoke?

Adlung, R., Molinuevo, M. — 2008-05-21

In most of the current literature, the spread of regionalism in international trade relations is discussed in terms of a rapidly rising number of preferential trade agreements (PTAs). Far less attention is given to the even more rapid proliferation of bilateral investment treaties (BITs) and their overlap with obligations assumed by WTO Members under the General Agreement on Trade in Services (GATS). BITs generally apply across a much wider range of service sectors, in particular in the case of least-developed countries (LDCs) and developing countries, than those scheduled under the GATS. Furthermore, a number of relevant disciplines, including on fair and equitable treatment, expropriation and dispute settlement, may go beyond potential counterparts under the GATS. At the same time, pursuant to GATS Article II, these disciplines are to be applied on a most-favoured-nation (MFN) basis. Based on a comparative analysis of relevant provisions, this article discusses options on how WTO Members could proceed.

Legal and Political Oversight of WTO Waivers

Harrison, J. — 2008-05-21

This article discusses the legal and political processes available within the WTO for the scrutiny and oversight of waivers. These procedures include the initial approval procedures, as well as procedures for overseeing the implementation of waivers once they have been approved. It is submitted that the certain aspects of a waiver are inherently political and the principal mechanisms for their oversight are through the political organs of the WTO. Dispute settlement is, however, available as a tool for determining whether or not a WTO Member has complied with the substantive terms and conditions of a waiver. In this light, this article considers the legal status of waivers in the context of dispute settlement. It concludes that waivers are best characterized as exceptions so that the state invoking the waiver bears the burden of proving that the terms and conditions have been met. The article also suggests that there is no need for a narrow interpretation of waivers and that the customary international law rules of treaty interpretation should apply.

Public Opinion and the Interpretation of the World Trade Organisation's Agreement on Sanitary and Phytosanitary Measures

Foster, C. E. — 2008-05-21

The WTO system is increasingly finding itself undermined by intractable disputes that involve high levels of public concern about the safety of proposed imports, in particular as seen in the EC-Hormones and the EC – Approval and Marketing of Biotech Products cases. This indicates a systemic problem in the interpretation and application of the SPS Agreement. In addressing this problem, a new starting point needs to be adopted. A democratic approach would suggest that where a Member's population simply does not want to run a given risk, this risk should not be imposed on the population. A careful consideration of the central provisions of the SPS Agreement reveals that there remains considerable scope for greater recognition within SPS jurisprudence of the significance of public opinion in decision-making about risks to human health and the environment, in a way that combines scientific and non-scientific aspects of decision-making about risk. Adopting such an approach will help ensure consistency between international economic law and broader public international law, including international human rights treaties and international environmental law.

Adaptive Efficiency and Financial Development in China: The Role of Contracts and Contractual Enforcement

Yu, G., Zhang, H. — 2008-05-21

The existing literature on China's economic development has focused so far more on economic reform, decentralization, and the clarification and protection of property rights. There is, however, inadequate attention being paid to the adaptive efficiency of economic actors, in general and to experimenting with informal and formal contractual arrangements, in particular. In this article, the authors document and analyze the informal contracts developed in Wenzhou, and three types of formal contractual arrangements increasingly used in China. The authors argue that both informal and formal contractual mechanisms play important roles in China's economic development. The general pattern appears to be that economic actors rely first on self-enforcing, informal contractual arrangements and later adopt more formal arrangements when these are feasible. The authors, by focusing their analysis on the development and adaptation of selected contractual arrangements, submit that the process of legal development in China is consistent with the notion of adaptive efficiency. The implication from the study is that the development of a formal contract regime will become increasingly important as economic development reaches a more advanced stage. When economic actors are able to rely on more formal contractual arrangements, more complex, riskier transactions with higher technological content will be pursued.

Trade in Food: Regulatory and Judicial Approaches in the EC and the WTO. By ALBERTO ALEMANNO

Johnecheck, W. — 2008-05-21

National Law in WTO Law, Effectiveness and Good Governance in the World Trading System. By SHARIF BHUIYAN

Oppong, R. F. — 2008-05-21