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IPC Roundtable Discussion

Cotton, Sugar and Wheat Board Cases:

What do they mean for agricultural negotiations?

Friday, June 4, 2004

Washington, DC

Featuring: IPC Member Timothy Josling, Professor and Senior Fellow, Institute for International Studies, Stanford University

PowerPoint Presentation    - Microsoft Word Format/Microsoft PowerPoint Format

Cases involving farm policies for cotton, sugar and wheat have recently been litigated through the WTO's disputes resolution system.  Will the threat of more cases make the agricultural community reluctant to back further progress in the WTO? 

Litigation in the WTO plays an important role in enforcing the rules that countries have agreed upon.  However, there is a risk that trade litigation could be pursued in ways that do not necessarily serve the multilateral trade system. The outcome of the cotton panel as it has been reported in the press has caused many agriculture leaders in the US and elsewhere to accuse the WTO disputes panel of interpreting the agreements in ways that negotiators did not intend, effectively increasing the scope of the rules through litigation rather than negotiation. 

How can negotiators find language that makes everyone happy, if there is a threat of trade litigation that will undermine or reinterpret negotiated language?  Will the negotiators have to have trade lawyers at their elbows during the negotiations?

Negotiated concessions on agriculture are an integral part of the balance of interests and advantages inherent in the WTO, and abuse of the rules (inadvertent or deliberate) can change that balance. But judicial interpretations can also disturb the perceived balance of advantages that countries derive from the WTO, putting support for further reform at risk from those who are on the losing end of the panel's decision.

Is it possible to confine trade litigation to the constructive interpretation of the WTO agreements, to prevent abuse and to support the basic aims of the WTO? Or is trade litigation also being used as an alternative to trade negotiation, or as a disguised import barrier to protect domestic industry or enhance an export industry? What is the dividing line between the enforcement of the rule of law and the provision of an avenue for protection? How can one distinguish between full implementing of accepted trade remedies and the harassment by exporters by exploiting the opportunity for legal challenges?



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