Private party standing in the WTO: towards judicialization of WTO decisions in U.S. courts.

Author:Itagaki, Kohshi Arnold
  1. INTRODUCTION II. IN SUPPORT OF PRIVATE PARTY STANDING IN WTO DISPUTE SETTLEMENT PROCEDURES A. Policy Rationale to Support Private Party Standing in the WTO B. Arguments Against Private Party Standing in the WTO III. U.S. STATUTES ON TREATMENT OF WTO DECISIONS IN U.S. COURTS IV. JUDICIAL DOCTRINES ASSESSING WTO DECISIONS AND MEASURES TAKEN BY CONGRESS V. HOW U.S. COURTS REVIEW WTO DECISIONS AND CONGRESS'S WTO-INCONSISTENT ACTIONS A. U. S. Courts Expressing Relevance of WTO Decisions in Their Analysis B. Corus Staal and the Cases Thereafter: Near-Absolute Deference to the Legislature C. Judicial Review of "Reasonableness" of Commerce's Responses to WTO Decisions VI. POTENTIAL JUDICIALIZATION OF WTO DECISIONS BY U.S. COURTS A. U.S. Courts Leaving Open the Possibility of Judicializing WTO Decisions B. Applying Judicially-Created Doctrines to Recognize WTO Decisions as Binding C. The Weight of WTO Decisions as Evidence for Causes of Action Before U.S. Courts VII. LIMITS ON THE JUDICIALIZATION OF WTO DECISIONS IN U.S. COURTS A. Overcoming the Existing Deference to the Legislature B. The Non-Binding Nature of WTO Decisions VIII. CONCLUSION I. INTRODUCTION

    Since its inception, the WTO Dispute Settlement Body (DSB) has been praised by both supporters and critics of the WTO for its efficiency and for changing the face of modern international trade. (1) The WTO Agreements, which establish the DSB, are some of the most comprehensive international agreements on trade in modern history. (2) The Agreements have changed the mechanism for dispute settlements between member states. (3)

    When there is a trade dispute involving a WTO agreement, WTO members may invoke the WTO dispute settlement procedures to remedy alleged violations. (4) This system was initially viewed as a significant improvement over previous General Agreement on Tariffs and Trade (GATT) dispute settlement provisions (5) under which there was no enforcement mechanism to counteract member states having to comply with GATT provisions only when it was "in their individual best interests to do so." (6)

    While representatives of all WTO members administer the dispute settlement proceedings and are permitted to utilize the dispute mechanisms, developed countries have been the most frequent utilizers of the dispute system. (7) One of the key characteristics of the WTO dispute settlement system is that only member states (i.e., countries signed onto the WTO) are permitted to initiate disputes. (8) Thus, private nonstate actors, including non-governmental organizations (NGOs) and corporations, lack the standing and opportunity to initiate trade disputes under the WTO. (9)

    The proposition for allowing non-state actors the opportunity to initiate a dispute (private party standing) under the WTO DSB has garnered significant debate, which the WTO has yet to formally address. (10) In the United States, Congress and the judicial system have clearly stated that the measures to respond to decisions regarding WTO decisions by the DSB should be vested solely with Congress. (11)

    This Note seeks to intertwine two seemingly distinct areas of international trade to consider and predict their combined effect on WTO jurisprudence in the future: (1) the policy arguments in support of private party standing in the WTO dispute settlement procedures, and (2) the potential treatment of WTO jurisprudence by the U.S. judicial system if such a change were to be implemented. The purpose for the merger of these topics is to propose the potential changes in the treatment of WTO jurisprudence in domestic court systems if private party standing were permitted in the WTO. Although WTO decisions have been treated as non-binding recommendations to member states, U.S. courts may be willing to rely on WTO decisions with more binding authority in specific circumstances discussed in this Note.

    The parts discussed in this Note are as fragmented as they are interrelated, with the purpose being to provide as well-rounded a scope of information as possible in assessing the two abovementioned key areas of interest. As previously discussed, arguments for private party standing and the impact of such changes on U.S. jurisprudence have been kept isolated from one another, so a broad overview of several subtopics is necessary to create the appropriate context for analysis. The idea is to propose a potential course of action that U.S. courts may take in response to private party standing in the WTO decision based on a diverse context of judicial, legislative, and public policy subtopics relevant to the two main topics of this Note.

    Part II of this Note presents an overview of the policy arguments in support and against the possibility of private party standing in the WTO, concluding that private party standing should be allowed in the WTO dispute settlement procedures. Part III provides the relevant statutory law enacted by Congress regarding the treatment of WTO jurisprudence. Part IV defines judicially created doctrines that U.S. courts utilize in addressing issues of international trade law and international law more generally. Part V reviews the past and present treatment of WTO jurisprudence and legislative actions in response to WTO decisions. Part VI proposes the potential path that U.S. courts may take in response to private party standing in WTO dispute settlement procedures. Based on policy interests, statutes, case law, and judicial doctrines discussed in the previous sections, this Note addresses the possibility for WTO jurisprudence to create binding international obligations in the U.S. judicial system. This proposition will, however, be limited to specific circumstances where (1) a private party files a suit in a U.S. court against the U.S. government (2) relying on a WTO decision in favor of that same private party (3) for the government's failure to comply (including non-action) with the WTO decision in favor of the private party. Finally, Part VII briefly presents key limitations to the raised hypothesis in light of the statutory law addressed in Part III and the body of case law presented in Part V, which establishes the non-binding nature of WTO decisions. This section also examines the more likely outcome that U.S. courts will, as a matter of public policy, defer to Congress on how to treat WTO decisions in light of private party standing in the WTO. Nevertheless, the judicially created doctrines are available for U.S. courts to recognize WTO decisions as binding international obligations under U.S. law.

  2. IN SUPPORT OF PRIVATE PARTY STANDING IN WTO DISPUTE SETTLEMENT PROCEDURES

    Concerns have emerged regarding the current WTO dispute settlement system and whether it should be revised to better accommodate the role of non-state actors in the changing global landscape. (12) International trade issues overseen by the WTO have become more globally interconnected, (13) with both new countries joining the WTO (14) and countries formerly having very little impact on international trade increasing in economic strength. (15) As discussed in the subsequent paragraph, developing countries in particular have been the most vocal critics of the current WTO dispute settlement system, viewing the current regime as enforcing a system inherently biased against them. (16) Due to the dramatic rise of developing countries becoming WTO member states (17) in the past several years, one major revision to the WTO dispute settlement procedures that may be warranted is the expansion of private party involvement and standing in particular. (18)

    Some have argued that it is inconsistent for a dispute settlement system to allow alleged violations of WTO rules on the basis of an individual's injury, yet not permit such decisions by the WTO DSB to be enforced by individuals affected by non-implementation of applicable WTO decisions. (19) Allowing private party standing in the WTO DSB provides a practical way to ensure that developing countries can utilize the system by having their WTO disputes represented and addressed by private parties of those countries. (20)

    The primary revision to the WTO that may resolve some major issues with the DSB is to eliminate the limitation that only WTO member states can initiate trade disputes under the WTO agreement and allow private parties to initiate disputes in the WTO dispute settlement procedures as well. (21) Other methods for effectively responding to the criticisms of the WTO dispute procedures have been considered, such as allowing the private sector to offer legal services to counteract the financial hurdles to participating in the WTO dispute system (22) and increasing the rights of third parties (i.e., WTO members not parties named in a WTO dispute) to participate in the panel stage of the dispute proceedings and submit documents to the Dispute Panel. (23) While such methods are easier to implement, they fail to resolve the most inherent challenge for developing countries: the ability for developing countries to initiate WTO disputes particular to their interests without need or reliance on other countries' selection of such claims. By allowing private party standing, these countries can rely on and utilize private parties to initiate disputes on their behalf regarding interests unique to them.

    Due to the economic and structural hurdles for developing countries, private party standing is viewed as one of the key options for ensuring participation of all WTO member states in the WTO DSB. (24) The possibility for disputes to be initiated by private persons (e.g., corporations and individual trade participants) gives disadvantaged countries the ability to have their trade concerns addressed in the WTO, despite lacking the resources necessary to initiate such claims themselves. (25) Statistical data reflects a WTO dispute system overwhelmingly utilized by developed countries; (26) the lack of expertise and necessary resources of developing countries (27) prevents...

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