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FTA Law in WTO Dispute Settlement: Peru–Additional Duty and the Fragmentation of Trade Law

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  • SHAFFER, GREGORY
  • WINTERS, L. ALAN

Abstract

There is a serious imbalance between the sclerosis of the political system of the World Trade Organization (WTO) and the automatic adoption of WTO Appellate Body judicial reports. The question is whether the WTO Appellate Body will recognize bilateral political agreements (such as under Free Trade Agreements, FTAs) that modify WTO obligations between two parties. In addressing this question, the Appellate Body decision in Peru–Additional Duty on Imports of Certain Agricultural Products is important. The decision addressed the availability of defenses under FTAs in WTO disputes, as well as under public international law generally. After critically assessing the decision, we set forth a series of judicial and political choices for addressing the interaction of WTO and FTA rules going forward. In particular, we contend that clear modifications of WTO commitments under an FTA should be recognized by WTO panels as a defense, but subject to the FTA itself complying with WTO requirements under GATT Article XXIV. The case is important not only for trade specialists, but generally for policymakers and scholars of global governance in a world of fragmented international treaties.

Suggested Citation

  • Shaffer, Gregory & Winters, L. Alan, 2017. "FTA Law in WTO Dispute Settlement: Peru–Additional Duty and the Fragmentation of Trade Law," World Trade Review, Cambridge University Press, vol. 16(2), pages 303-326, April.
  • Handle: RePEc:cup:wotrrv:v:16:y:2017:i:02:p:303-326_00
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    Cited by:

    1. Erin Hannah & James Scott & Rorden Wilkinson, 2018. "The WTO in Buenos Aires: The outcome and its significance for the future of the multilateral trading system," The World Economy, Wiley Blackwell, vol. 41(10), pages 2578-2598, October.
    2. Kenta Hirami, 2020. "FTAs in WTO Dispute Settlement," Public Policy Review, Policy Research Institute, Ministry of Finance Japan, vol. 16(5), pages 1-18, August.

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