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2022 Tricky Question of WTO on International law | UPSC Law Optional

Updated: Feb 28, 2023

What is the most favoured means of decision-making at World Trade Organisation? Under what circumstances can decisions be taken by Majority votes? Which decisions require super majority votes? Is there a need to reform the decision-making process? Discuss. 2022 UPSC Law Optional Question.


HOW TO ANSWER THIS QUESTION.

1.Answer which is most-favoured means of decision-making in WTO.

2. Explain about WTO-Consensus method of decision-making and when super-majority or simple majority decisions are taken.

3.Explain the problems relating in working of Consensus method.



WTO is Rules-based and Member driven organization.


FAVORED MEANS OF DECISION MAKING | BY CONSENSUS

  • Normally, all the decisions of WTO are reached on consensus and that means that a decision said to be taken when there is no objection from any member. [Art.IX.1]

  • Only in Limited range of circumstances, the WTO agreements allow for decisions to be made by voting, usually by a SUPER-MAJORITY.

EXCEPTIONS | SUPER-MAJORITY.

  • Interpretation of the agreements – It has to be of 3/4 Super-Majority approval of Ministerial Conference & General Council (Article IX:2).

  • Decision to grant a temporary waiver to a member country from WTO obligations - 3/4 Super-Majority approval of Ministerial Conference (Article IX:3).

  • Amendments, if they cannot be reached by consensus, generally require - 2/3 Super-Majority approval of Ministerial Conference (Article X)

  • Selection of director-general selection procedures - SIMPLE MAJORITY.


GOOD THINGS ABOUT CONSENSUS.

  • Ehlermann and Ehring (2005: 513) asserted, because “it will tend to enjoy broad support” and also “means that no one loses face.”

  • According to the International Law Association (2006: 15), consensus “protects the quality and inclusiveness of decision-making and gives each WT0 Member a veto power, limited by joint political pressures, which is otherwise not present in the case of voting.”

WHY REFORMATION IS REQUIRED | PROBLEM WITH CONSENSUS APPROACH IS THAT.


  • “Gives every country a veto and thus reduces any potential initiative to the least common denominator.” [Jackson]

The only workable solution to that veto is to hope that individual members do not abuse the privilege, a hope that is sometimes backed up by peer pressure or other tactics. The most high-profile example of this came in the adoption of the Doha Ministerial Declaration in 2001, when India was the sole hold-out. That single country had the capacity under the rules to prevent the round from being launched, and might perhaps have exercised its right if at least a few other members joined it in opposition, but when fully isolated was not willing to block a decision that had the support or acquiescence of all other members.

  • When consensus is blocked - (a) for approval of agreement / (b) ratification of agreement - by a single member - which is agreed by all.

  • Only solution is to threaten that member who vetoes with expulsion.

EXAMPLE :

  • LON expelled the Soviet Union in 1939 for its invasion of Finland, and

  • UN + GATT = Serbia and Montenegro after the invasion of Bosnia and Herzegovina in 1992.

  • Barfield (2001: 1) WTO “is jeopardized by a formidable constitutional flaw” in the form of “the imbalance between the WTO’s consensus-plagued, inefficient rule-making procedures and its highly efficient dispute settlement system.”

  • Solution GIVEN BY HIM: Block minority rule - 1/3 of members - agree not to agree.




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