Private Parties and WTO Dispute Settlement System: Who bears the costs of non-compliance and why private parties should not bear them

Alberto Alemanno (1)

1 GREGH - Groupement de Recherche et d'Etudes en Gestion à HEC

This paper examines the (non) role that private business operators play in the implementation of WTO Dispute Settlement Reports. More precisely, by analysing the legal status of these decisions in national and regional law, it looks at what individuals are entitled to obtain when a WTO Member ignores the results of a Dispute Settlement Body's proceedings. As private business operators bear most of the economic costs of non-compliance, there is an increasing pressure for a more direct involvement of these parties in the Dispute Settlement System mechanims. The challenge is therefore to find a way to accommodate their interests within the current settlement system, without reducing the discretion WTO Members enjoy in the implementation of the reports. An answer to this problem is even more needed as uncertainties surrounding the results of the WTO dispute settlement procedure will be exacerbated as soon as non-violation cases expand into the newly-emerging areas, such as investments and competition policies. The recent attempt made by a French company to recover damages incurred as result of the EC non-compliance with the Hormones decision before the European Courts (CFI/ECJ) is provided, throughout the paper, as an example of private parties' involvement in the implementation phase. This paper argues that private parties should be allowed to invoke settlement disputes decisions before the courts of the losing WTO Member to seek compensation for the damages incurred after the expiration of the given reasonable period of time to comply with the report. After reviewing most of the underlying arguments for and against this solution, it demonstrates that looking at the status of DSB's reports exclusively through the lens of direct effect might be misleading. The paper will conclude by arguing that granting the right of individuals to invoke a DSB's ruling could improve the relationship that private business operators have with the multilateral trading by striking a more fair balance between the interests of all the WTO relevant actors.

Mots clés: WTO; EU; Direct Effect; DSB; Hormones

Alberto Alemanno. Private Parties and WTO Dispute Settlement System: Who bears the costs of non-compliance and why private parties should not bear them. 2004. ⟨hal-00591679⟩