Guzman: Determining the Appropriate Standard of Review in WTO Disputes

Andrew T. Guzman (Univ. of California, Berkeley - Law) has posted Determining the Appropriate Standard of Review in WTO Disputes. Here's the abstract:

The WTO's dispute settlement system - and, more particularly, WTO panels and the Appellate Body (AB) - are charged with ruling on the consistency of the actions of WTO Members with the obligations imposed by the WTO Agreements. To do so, panelists and AB judges must first determine the standard of review they are to adopt. A more deferential standard will increase the range of activities that the panel or AB will find permissible, while a more stringent standard will narrow that range. With the exception of the Anti-Dumping Agreement, however, neither the Dispute Settlement Understanding nor the specific WTO Agreements themselves provide much guidance regarding the standard of review that should be applied. Article 11, the key provision in the DSU, leaves a great deal to be worked out in litigation.

Identifying the appropriate standard of review requires a determination as to whether the authority to approve certain decisions lies with the Member State or the judicial organs of the WTO. A deferential standard leaves that authority substantially with the state, while a de novo standard gives the panel that authority.

This paper provides an analysis of the costs and benefits associated with more or less stringent standards of review. It argues that WTO-review is desirable primarily because panels and the AB are able to approach disputed issues without bias. The states involved in a dispute, in contrast, have an incentive to view both facts and law in a way that suits their own objectives. Panels and the AB, however, are poorly positioned, relative to states, to assess the legal, cultural, economic, and political context within states. This inevitability means that, in some cases, it is wise to leave greater discretion to the states. The different abilities of Member States and the judicial organs of the WTO allow us to develop a sense of when the standard of review should be more or less deferential. Where a lack of bias is particularly important and where the issues involved are ones in which a panel can be expected to have great expertise, a more stringent standard of review would be appropriate. Where, on the other hand, a case demands detailed knowledge of events or priorities in a state, the case for a more deferential standard of review is stronger.

After elaborating the above perspective on the appropriate standard of review, the paper then provides several examples of the standards that the panels and the AB should adopt, as well as examples of standards they have actually adopted. Among the disputes considered will be those implicating the SPS Agreement; the Anti-Dumping Agreement; the Safeguards Agreement; the national treatment and most-favored nation obligations; and the general exceptions contained in Article XX of the GATT.