National Research University “Higher School of Economics”
Law Faculty
Course:
Law of the World Trade Organization
Lecturer: Oksana Lopatina, professor, Department of International Law, Law Faculty of the National Research University “ Higher School of Economics”
Course Outline
The world trading system has undergone massive changes in the last sixteen years. The creation of the WTO and the development of enforceable international rules governing trade in services and intellectual property rights as well as trade in goods vastly expanded the scope and effectiveness of the system. The World Trade Organization (WTO) is the primary organization in the field of economic globalization. WTO law governs the rights of governments to regulate international trade in goods and services and requires them to protect intellectual property. The WTO has an active dispute settlement system which, since 1995, has produced a substantial jurisprudence. The aim of the course is to provide students with a theoretical and practical understanding of the regulatory framework of the world trading system, covering both the institutional and substantive law of the World Trade Organisation (WTO), which has played a central role in promoting and regulating international trade liberalisation since its establishment in April 1994.
Students will begin by reflecting on the theoretical arguments for and against international trade liberalisation and on the role of law and institutions in international trade relations. Three seminars of the course will then be dedicated to the institutional structure and decision-making processes of the WTO, including its unique system for the resolution of international trade disputes. Subsequently, students will explore the key legal disciplines relating to international trade in goods and services, such as the non-discrimination principles, market access commitments and rules on dumping, subsidisation and product standards. Students will then engage with other substantive areas of WTO law, such as the WTO Agreement on Trade in Services, the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights and the principle of special and differential treatment of developing countries. In addition, students will consider how WTO law interacts with other areas of international law and the extent to which WTO members can use trade measures to pursue other (non-trade) values, such as environmental protection, the rights of WTO Members to protect public policy interests. A special theme is the role of developing countries within the WTO system.
Students will be further exposed to some of the contemporary challenges facing the WTO, including the impasse of the Doha Round of multilateral trade negotiations and the proliferation of regional trade agreements, as well as to broader issues in global economic governance, such as inter-institutional cooperation and coherence, transparency and public participation.
The course presumes no prior knowledge of economics or trade policy. It is an advantage, though not mandatory, to have a background in public international law. The first part of the course commences with the history of the WTO and its institutional dimension. Next, it turns to the mechanism of trade negotiations and the core WTO principles in goods and services as well as the non-economic exceptions to WTO obligations. Based on this knowledge of substantive WTO law, the course discusses the WTO dispute settlement system, including the relationship between WTO law and other parts of the international legal system (for example, environmental and human rights law).
The second part of the course covers more specialized subjects, including the regulation of product standards and of food safety and pests, as well as the main trade policy instruments used by governments to protect their domestic industries, i e subsidies and ‘trade remedies’, intellectual property protection, including the legal rights of WTO Members to order “compulsory licenses” for essential medicines, and the issue of trade and finance.
Finally, the course devotes three seminars to a discussion of the major subsystems of trade regulation, which exist formally as exceptions to the most-favoured-nation obligation. The first of these is the Generalized System of Preferences (GSP), under which developed countries may grant preferential tariff treatment to developing countries; the second is the regulation of regional trade agreements. The course is rounded off with a seminar discussing those areas in which regional trade agreements go beyond the subjects covered by the WTO.
Objectives and learning outcomes of the course
· To consider and compare the economic theory, versus social and political reality, in which trade occurs and is regulated.
· To gain an understanding of the basic structure of the WTO institutions and texts, especially the General Agreement on Tariffs and Trade GATT; and their relationship with other institutions, states and laws.
· To examine the institutions, procedures and principles governing the settlement of trade disputes at the WTO.
· To examine the remedies available to winners, mechanisms for their enforcement, and barriers to access to justice for developing and new Member States.
· To consider the concept of non-discrimination, as expressed in the principles of National Treatment and the Most Favoured Nation Treatment, with special reference to the merits of differential and more favourable treatment of poorer nations.
· To explore the protection of the environment both as an objective of, and as a challenge to, the WTO regime.
· To explore the treatment of subsidies in the WTO, with special reference to agricultural goods, such as cotton, that are of economic importance to developed and developing countries.
· To examine the nature and scope of the General Agreement on Trade in Services (GATS) with particular reference to its relationship with the GATT and its impact on developing countries.
· To explore the nature and implications of efforts to protect intellectual property rights through the WTO, in particular the Agreement on Trade-Related Intellectual Property Rights (TRIPs).
· To explore the nature and implications of efforts to prohibit trade-related investment measures, such as local content requirements, that are inconsistent with the GATT; as well the treatment of service-related investment under the GATS.
At the end of the course a student should be able to demonstrate the ability to:
· Evaluate the place of international trade rules within the international legal and political system;
· Critically assess the tension between law, economics and politics in an international regulatory environment;
· Evaluate the role of WTO law within its members’ domestic legal systems;
· Engage in current debates as to the constitution, dynamics and direction of the global economy.
Syllabus
№№ / HoursIn all / Class work / Student’sworkload
Lectures / Seminars
1. / History of GATT and WTO / 10 / 4 / - / 6
2. / Structure, principles and functions of WTO / 10 / 4 / 2 / 6
3. / Dispute settlement system of the WTO. Principles of WTO dispute settlement. Proceedings. / 16 / 4 / 2 / 10
4. / The rules of international trade. GATT-94. Principles of non-discrimination. Most- favoured-nation treatment. National treatment. Tariff binding. / 16 / 4 / 2 / 10
5. / Agreements on Implementation of Article VI and Article VII of the GATT 1994. Dumping and anti-dumping measures. Subsidies. Safeguards Agreement. / 18 / 4 / 2 / 12
6. / WTO and developing countries. The legal status of special and differential treatment (SDT). DSB and developing countries. / 12 / 2 / - / 10
7. / WTO’s Agreement on agriculture. Domestic support and export subsidies commitments. / 12 / 2 / 2 / 8
8. / The international trade in services. Services in GATT/WTO system. / 16 / 4 / 2 / 10
9. / Trade-related aspects of intellectual property wrights. The TRIPs agreement within the GATT/WTO system. / 16 / 4 / 2 / 10
10. / International trade and investment. / 14 / 4 / - / 10
11. / International trade and environment. Trade versus environment. The Sanitary and Phytosanitary Agreement. / 16 / 4 / 2 / 10
Итого / 162 / 42 / 18 / 102
Reading List
There are various textbooks and casebooks on WTO law. The purchase of at least one of the textbooks noted below is recommended. There is no main text for the course – the choice is a matter of preference.
The course will be taught on the basis of reading lists. These will be divided into mandatory reading and recommended reading. The mandatory reading will be mainly primary materials in the form of treaty texts, subsidiary WTO instruments and dispute settlement reports (ie the cases). It is essential to bring these materials to class. The treaty texts are collected in The Results of the Uruguay Round of Multilateral Trade Negotiations: The Legal Texts (any edition) or can be copied from the WTO website and it is essential to bring these to class. The materials listed as 'supplementary reading' do not need to be brought to class.
Textbooks
Mavroidis, Berman, Wu, The Law of the World Trade Organization (2010)
Trebilcock and Howse, The Regulation of International Trade (4th ed 2012)
Van den Bossche, The Law and Policy of the World Trade Organization (2nd ed 2008)
Supplementary reading
This course is not an economics or trade policy course though some understanding is helpful for studying WTO law. The following books provide useful background.
Bhagwati, In Defense of Globalization (2nd ed.2007)
Blustein, Misadventures of the Most Favoured Nations: Clashing Egos, Inflated Ambitions, and the Great Shambles of the World Trade System (2009)
Hoekman and Kostecki, The Political Economy of the World Trading System (3rd ed 2009)
Irwin, Free Trade Under Fire (3rd ed 2009)
Irwin, Against the Tide: An Intellectual History of Free Trade (1996)
Irwin, Trade Policy Disaster: Lessons from the 1930s (2011)
Krugman, Pop Internationalism (1996)
Wolf, Why Globalization Works (2005)
Some more critical books are:
Chang, Bad Samaritans: The Guilty Secrets of Rich Nations and the Threat to Global Prosperity (2007)
Lang, World Trade after Neoliberalism: Reimagining the Global Economic Order (2011)
Stiglitz and Charlton, Fair Trade for All: How Trade Can Promote Development (2007)
Unger, Free Trade Reimagined (2007) and also available at http://press.princeton.edu/chapters/s_8473.pdf
Online materials
A great deal of material is available online. Most important is the WTO website: www.wto.org and its documents database at http://docsonline.wto.org. Another useful site for primary material and commentary is http://www.worldtradelaw.net, and the blog on this site is a useful source for identifying current trade disputes and at http://www.worldtradelaw.net/dsc/dscpage.htm you will find a summary of every WTO dispute.
Teaching methods
The knowledge base is developed through a combination of lectures, classes and directed reading. Different parts of the course utilize different combinations of these methods.
* Lectures (One two-hour lecture per week).
Lectures provide an overview framework of the area of study and of the key issues and arguments.
* Classes (One two-hour class per week).
Classes provide an opportunity to test knowledge and understanding of key substantive areas and clarify any uncertainty. Students are expected to be fully prepared beforehand in order to be able to participate actively in a discussion.
Assessment and grade determination
There will be an end-of-course written examination worth 70% of the final grade. The students will be required to answer a number of Multiple Choice Questions (30%) and two from a choice of four essay questions (70%). On essay questions the grade received will be based upon:
· The relevance of an answer to the question set
· Clarity of expression and continuity
· Evidence of reading and thought related to the topic
· Quality of the arguments presented
Grade determination
Final course grade is calculated as weighted average with the following weights:
· Final exam - 70%
· Class record - 30%