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Observations on Trade Law and Globalization

Published online by Cambridge University Press:  28 February 2019

Extract

I imagine most people with an interest in the subject have their own working definition of globalization. My definition goes something like this: Globalization is at least in part about the spread of mass markets and common tastes, albeit with variations. International trade law, by reducing the possibility that individual countries can “prefer” their own productions, is one of the mechanisms for facilitating the spread of these common tastes. I am by no means implying that the global tastes are elevated ones; in fact, the mass-appeal products sought might be inferior in many ways to what came before. The irony of the franchise, for instance, is that better or worse does not matter—only sameness. The important thing is that the tastes are commonly held across a national-culture-free zone, and recognized as such.

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Copyright © 2005 by the International Association of Law Libraries. 

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References

1 At the most basic level, GATT Article I, General Most-Favored Nation Treatment, requires participating States to treat the products of all participating trading partners without discrimination; Article III, National Treatment on Internal Taxation and Regulation requires these States to treat importing products in the same way they treat their own domestic products; and Article XI, General Elimination of Quantitative Restrictions, requires that Member States not to set up quantitative barriers to the importation of products.Google Scholar

2 See Leebron, David Claims for Harmonization: A Theoretical Framework, 27 Can‥ Bus‥ L.J. 63, 66 (1996). Leebron argues “the term ‘harmonization’ is something of a misnomer insofar as it might be regarded as deriving from the musical notion of harmony, for it is difference, not sameness, that makes for musical harmony.” Id. at 67.Google Scholar

3 A survey of 184 ABA accredited law schools in the United States found that 99 had at least one course in International Trade. Survey results on file with the author.Google Scholar

4 Unlike the WTO's dispute resolution mechanism, the UN's human rights treaty bodies have no effective enforcement mechanisms, but rely on a reporting system where States report on their application and compliance with treaty requirements and a Committee responds to the reports.Google Scholar

5 Though tangentially criticizing the WTO, human rights specialist groups such as Human Rights Watch and Amnesty International, who address many trade related issues such as human trafficking, bonded labor, child labor, etc., have not established coherent and sustained strategies to advocate that the WTO address trade-related human rights problems. Bryan Schwartz speculates as to why this might be. He writes:Google Scholar

“The style of WTO opinions tends to be dry, lawyerly and technical. Those who write the decisions are no doubt anxious to demonstrate to governments and the wider public that their decisions are not based on subjective political values. Rather, the adjudicators involved are anxious to demonstrate that any conclusions they reach flow inexorably from the application of logic to the precise words of the trade provision at issue.”Google Scholar

Schwartz, Bryan Lawyers and the Energing World Constitution, 1 Asper Rev. Int'l Bus. & Trade L. 1, 7 (2001). He calls this tendency “seeking legitimacy through technicality.” Id.Google Scholar

6 Marrakech Agreement Establishing the World Trade Organization, arts. XI, XII, Legal Instruments - Results of the Uruguay Round Vol. 31, 33 I.L.M. 1226 (1994) [hereinafter WTO Agreement] (requiring all ratifying Members to accept agreements settled at the Uruguay Round of trade negotiations). Between 1986 and 1994, the negotiators at the Uruguay Round created an intergovernmental organization (the WTO) that would enshrine the principles of the previous General Agreement on Tariffs and Trade (the GATT) relating to the trade in goods while adding agreements on trade in services, trade-related intellectual property, dispute settlement, and other supplemental agreements. See generally Bhala, Raj& Kennedy, Kevin, World Trade Law 8-15 (2d ed.) (2000) (explaining WTO's creation and mandate).Google Scholar

7 General Agreement on Tariffs and Trade, opened for signature, Oct. 30, 1947, 61 Stat. A3, T.I.A.S. No. 1700, 55 U.N.T.S. 187 [hereinafter GATT].Google Scholar

8 Moore, Patrick M. Current Development: The Decisions Bridging the GATT 1947 and the WTO Agreement, 90 Am. J. Int'l L. 317, 319 (1996).Google Scholar

9 United States – Prohibition of Imports of Tuna and Tuna Products from Canada (Tuna/Dolphin I), Feb. 22, 1982, GATT B.I.S.D. (29th Supp.), para. 4.8 (1982); United States – Restrictions on Imports of Tuna (Tuna/Dolphin II), Aug. 16, 1991, GATT B.I.S.D. (39th Supp.) para. 5.26 (1993), reprinted in 30 ILM 1594 (1991).Google Scholar

10 Dispute Settlement Understanding, WTO Agreement, supra note 6, arts. 46, Annex 2 [hereinafter DSU] (outlining procedures for WTO Members attempting to resolve complaints). DSU Article 4 encourages Members to first attempt to come to a mutual settlement of their dispute through good faith consultations. Id. art. 4. DSU Article 5 allows Members to voluntarily submit their dispute to conciliation and mediation by the WTO. Id. art. 5. DSU Article 6 permits the complaining Member to request the establishment of a WTO Panel, composed of individuals from a list of experienced practitioners, to settle the dispute. Id. art. 6. DSU Article 17 establishes a permanent WTO Appellate Body to hear appeals from Panel decisions. Id. art. 17.Google Scholar

11 WTO Agreement, supra note 6, annex 1 A.Google Scholar

12 The WTO's Dispute Settlement Understanding (DSU) creates a legalistic dispute settlement system, leading to rulings by an ad hoc panel and an Appellate Body, which, after adoption by the DSB, have binding effects on the disputing Member States and may lead to significant costs if disregarded by a loser. This could take the form of retaliatory tariffs placed on products of the “losing” country by the prevailing party. WTO Dispute Resolution Understanding, supra note 6, annex 2 [hereinafter DSU].Google Scholar

13 DSU, supra note 12, arts. 21 & 22.Google Scholar

14 There have been examples of a Member State not complying with Appellate Body reports, particularly the European Union's non-compliance in the Bananas and Beef Hormones cases. See Brimeyer, Benjamin L. Bananas, Beef, and Compliance in the World Trade Organization: The Inability of the WTO Dispute Settlement Process to Achieve Compliance from Superpower Nations, 10 Minn. J. Global Trade 133 (2001) [hereinafter Brimeyer].Google Scholar

15 The Doha Development Agenda was established to set objectives for multilateral agreements that would accelerate economic development for developing countries, particularly with regard to agricultural policies but also including, investment, environment, and competition policy. See World Trade Organization, Ministerial Declaration of 14 November 2001, WT/MIN(01)/DEC/1, 41 I.L.M. 746 (2002). At the subsequent Ministerial Meeting in Cancun, however, these negotiations collapsed when over twenty developing countries walked out in protest to the unwillingness of the US and EU to give adequate concessions regarding agriculture. See Johnson, Clete D. A Barren Harvest for the Developing World? Presidential “Trade Promotion Authority” and the Unfulfilled Promise of Agriculture Negotiations in the Doha Round, 32 Ga. J. Int'l & Comp. L. 437 (2004).Google Scholar

16 See Jackson, John H. The Boundaries of the WTO: Afterword: The Linkage Problem–Comments on Five Texts, 96 Am. J. Int'l L. 118, 121-22 (2002).Google Scholar

17 Davis, Michael H.& Neacsu, Dana, Legitimacy, Globally: The Incoherence of Free Trade Practice, Global Economics and Their Governing Principles of Political Economy, 69 UMKC L. Rev. 733, 757 (2001)Google Scholar

18 See the Draft Treaty Establishing a Constitution for Europe and accompanying materials, at http://european-convention.eu.int.Google Scholar

19 See Burca, Grainne de The Drafting of a Constitution for the European Union: Europe's Madisonian Moment or a Moment of Madness?, 61 Wash & Lee L. Rev. 555 (2004); see also Sieberson, Stephen C., The Proposed European Union Constitution – Will it Eliminate the EU's Democratic Deficit?, 10 Colum. J. Eur. L. 173 (2004).Google Scholar

20 See Stiglitz, Joseph E. Globalization and Its Discontents 22-23 (Norton, 2002). Stiglitz writes, “we have a system that might be called global governance without global government, one in which a few institutions - the World Bank, the IMF, the WTO - and a few players - the finance, commerce and trade ministries, closely linked to certain financial and commercial interests - dominate the scene, but in which many of those affected by their decisions are left almost voiceless.” Also cite to my Linkage article, where I coincidentally expressed a similar thoughtGoogle Scholar

21 See generally Sara Dillon, International Trade Law and Economic Law and the European Union (Hart, 2002) [hereinafter Dillon].Google Scholar

22 Starting with the Uruguay Round accords, countries have had to participate in all of the negotiated agreements as part of a “single undertaking.” This requirement meant that developing countries had to commit to substantially greater reforms of their trade barriers and trade practices than they did in the past. In the Uruguay Round, many countries had to accept obligations developed without their substantial participation, and which required the implementation and enforcement of regulatory policies that they have had great difficulty in fulfilling. See Schott, Jeffrey J.& Watal, Jayashree, Decision Making in the WTO, in The WTO After Seattle 283, 284-285 (Schott, Jeffrey J. ed., 2000).Google Scholar

23 See, e.g., Case 6/64, Costa v. Ente Nazionale Per L'Energia Elecrica (ENEL), ECR 585 (1964) (“By creating a Community of unlimited duration, having its own institutions, its own personality, its own legal capacity and … more particularly, real powers stemming from a limitation of sovereignty or a transfer of powers from the States to the Community, the Member States have limited their sovereign rights, albeit within limited fields, and have thus created a body of law which binds both their nationals and themselves”); Case 106/77, Amministazione Delle Finanze Dello Stato v. Simmenthal SpA (Simmenthal II), ECR 629 (1978) (“every national court must, in a case within its jurisdiction, apply Community law in its entirety and protect rights which the latter confers on individuals and must accordingly set aside any provision of national law which may conflict with it, whether prior or subsequent to the Community rule”); Case C-213/89, The Queen v. Secretary of State for Fransport, ex parte Factortame LTD (Factortame I), ECR I-2433 (1990) (“The full effectiveness of Community law would be … much impaired if a rule of national law could prevent a court seized of a dispute governed by Community law from granting interim relief”); Case 314/85, Firma Foto-Frost v. Hauptzollamt Lubeck-ost, ECR 4199 (1987) (holding the European Court of Justice has sole jurisdiction to declare Community acts invalid).Google Scholar

24 WTO, Report of the Appellate Body, India-Patent Protection for Pharmaceutical and Agricultural Chemical Products, WT/DS50/AB/R (Dec. 19, 1997)Google Scholar

25 WTO Agreement, supra note 5, annex 1C.Google Scholar

26 See Atik, Jeffery Global Trade Issues in the New Millennium: Democratizing the WTO, 33 Geo. Wash. Int'l L. Rev. 451, 452 (2001). Atik states: “Although the WTO is still of recent origin it yields considerable (and unexpected) power. The substantive terms of its agreements limit the scope of action for national regulation, stripping power away from states. Its enhanced dispute resolution mimics a form of hierarchical supremacy: WTO rules act as a super-constitutional text with a force superior to ordinary national enactments. Once the WTO Dispute Settlement Body finds that a national measure is inconsistent with a WTO obligation, the WTO member is expected to bring its law into conformity.” Id.Google Scholar

27 See WTO, Report of the Appellate Body, EC Measures Concerning Meat and Meat Products (Hormones), WT/DS26/AB/R, WT/DS48/AB/R, AB-1997-4 (Jan. 16, 1998) [hereinafter Beef Hormones]; WTO, Report of the Appellate Body, European Communities - Regime for the Importation, Sale and Distribution of Bananas, WT/DS27/AB/R (Sept. 9, 1997). See also, Terence P. Stewart & David S. Johanson, The WTO Beef Hormone Dispute: An Analysis of the Appellate Body Decision, 5 U.C. Davis J. Int'l L. & Pol'y 219 (1999); Clark, Hunter R. The WTO Banana Dispute Settlement and Its Implications for Trade Relations between the United States and the European Union, 35 Cornell Int'l L.J. 291 (2002).Google Scholar

28 See Brimeyer, , supra note 14; 147-162.Google Scholar

29 WTO Agreement, supra note 5, at annex 1A – Agreement on the Application of Sanitary and Phytosanitary Measures.Google Scholar

30 Beef Hormones, supra note 28, paras. 177-180.Google Scholar

31 See Permanent Mission of the United States, First Submission of the United States in European Communities - Measures Affecting the Approval and Marketing of Biotech Products, WT/DS291, 292 & 293 (Apr. 21, 2004). See also Winickoff, David Jasanoff, Sheila, Busch, Lawrence, Grove-White, Robin, Wynne, Brian, Adjudicating the GM Food Wars: Science, Risk, and Democracy in World Trade Law, 30 Yale J. Int'l L. 81 (2005).Google Scholar

32 See GATT, Report of the Dispute Panel, United States-Prohibition of Imports of Tuna and Tuna Products from Canada, GATT B.I.S.D. (29th Supp.) (Feb. 22, 1982) (unadopted); GATT, Report of the Dispute Panel, United States – Restrictions on Imports of Tuna, GATT B.I.S.D. (39th Supp.) (Aug. 16, 1991), reprinted in 30 ILM 1594 (1991) (unadopted).Google Scholar

33 See generally Shell, G. Richard Trade Legalism and International Relations Theory: An Analysis of the World Trade Organization, 44 Duke L.J. 829 (1995) (describing the creation of the WTO and the new “legalism” in international trade law); Gantz, David A., Failed Efforts to Initiate the “Millenium Round” in Seattle: Lessons for Future Global Trade Negotiations, 17 Ariz. J. Int'l & Corrp. L. 349, 350-57 (2000) (outlining some of the reasons for the first major protests against the WTO in Seattle in 1999).Google Scholar

34 See Dillon, , supra note 21, at preface.Google Scholar

35 See, e.g., Charnovitz, Steve Trade Law and Global Governance (Cameron May, 2002); Charnovitz, Steve, The Boundaries of the WTO: Triangulating the World Trade Organization, 96 Am. J. Int'l L.28 (2002); Charnovitz, Steve, Free Trade, Fair Trade, Green Trade: Defogging the Debate, 27 Cornell Int'l L.J. 459 (1994). Schaeffer, Robert, Trading Away the Planet, 15 Greenpeace, Sept.-Oct. 1990.Google Scholar

36 See Howse, Robert The Boundaries of the WTO: From Politics to Technocracy–and Back Again: The Fate of the Multilateral Trading Regime, 96 Am. J. Int'l L. 94 (2002); Howse, Robert, The Legitimacy of the World Trade Organization, in The Legitimacy of International Organizations 355 (Coicaud, Jean-Marc & Heiskanen, Veijo eds., 2001), Howse, Robert, Adjudicative Legitimacy and Treaty Interpretation in International Trade Law: The Early Years of WTO Jurisprudence, in The EU, The WTO, and NAFTA: Towards a Common Law of International Trade 59 (Weiler, J.H.H. ed., Oxford Univ. Press 2000); Weiler, Joseph, The Rule of Lawyers and the Ethos of Diplomats: Reflections on the Internal and External Legitimacy of Dispute Settlement, in Efficiency, Equity, and Legitimacy: The Multilateral Trading System at the Millennium 334 (Porter, Roger B., Sauve, Pierre, Subramanian, Arvind, & Zampetti, Americo Beviglia eds., 2001).Google Scholar

37 See Pauwelyn, Joost The Role of Public International Law in the WTO: How Far Can We Go? 95 Am. J. Int'l L. 535 (2001). But see Trachtman, Joel P., The Domain of WTO Dispute Resolution, 40 Harv. Int'l L.J. 333. 342 (1999) (arguing that WTO dispute resolution is authorized to directly apply only WTO law).Google Scholar

38 U.S. Congressional distaste for the WTO dispute resolution process was expressed by Senator Max Baucus, stating that WTO panels are “making up rules that the US never negotiated, that Congress never approved, and I suspect, that Congress would never approve.” US DSU Proposal Receives Mixed Reactions, Bridges Wkly. Trade News Dig., Dec. 20, 2002, at http://www.ictsd.org/weeklv/02-12-20/wtoinbrief.htm Google Scholar

39 A report transmitted by the Secretary of Commerce to Congress concluded that the disputes referred to the DSB generally “have been handled expeditiously and with professionalism” and that “WTO dispute settlement has benefited a wide range of U.S. industries and their workers,” but adds that “the United States does not agree with the approach that WTO panels and the Appellate Body have sometimes taken in disputes,” and criticizes several specific instances of judicial lawmaking in trade remedy cases. The report suggested some measured fine-tuning to offer “greater member control over the dispute settlement process,” and noted that though judicial lawmaking at the WTO has become a political irritant in the US, Appellate Body lawmaking has only marginally weakened U.S. trade remedy laws, but is operating near its political limits. Executive Branch Strategy Regarding WTO Dispute Settle ment Panels and the Appellate Body, Report to the Congress Transmitted by the Secretary of Commerce 8-10 (Dec. 30, 2002), available at http://www.ita.doc.gov/FinalDec31ReportCorrected.pdf.Google Scholar

40 See generally Thomas Cottier & Petros C. Mavroidis, editors, Patrick Blatter, associate editor, Does the WTO Judge Trespass His Mandate?, The Role of Judge in International Trade Regulation: Experience and Lessons for the WTO, (University of Michigan Press, 2003).Google Scholar

41 Polaski, Sandra Jobs, Wages and Household Income, in NAFTA's Promise and Reality 24 (CEIP, 2003) available at http://www.ceip.org/files/pdf/NAFTA_Report_ChapterOne.pdf.Google Scholar

42 Id. at 10-13.Google Scholar

43 Kafka, Franz The Trial (N.Y.: Schocken, 1925).Google Scholar

44 Turow, Scott One L (N.Y.: Putnam, 1977).Google Scholar

45 See, e.g., Edward, David A.O. What Kind of Law Does Europe Need? The Role of Law, Lawyers and Judges in Contemporary European Integraton, 5 Colum. J. Eur. L. 1, 7-8 (1999).Google Scholar

46 See supra note 23.Google Scholar

47 See, e.g., Kelly, J. Patrick Judicial Activism at the World Trade Organization: Developing Principles of Self-Res traint, 22 NW. J. Int'l L. & Bus. 353 (2002).Google Scholar

48 See Desta, Melaku Geboye The Bumpy Ride Towards the Establishment of “a Fair and Market Oriented Agricultural Trading System” at the WTO: Reflections Following the Cancun Setback, 8 Drake J. Agric. L. 489 (2003).Google Scholar

49 For history and analysis of past and present development models of the IMF and World Bank, see Sanders, Jeremy J. The World Bank and the IMF: Fostering Growth in the Global Market, 9 Currents Int'l Trade L.J. 37 (2000).Google Scholar