Dispute Settlement in the WTO. Mind Over Matter

Abstract

The basic point I advocate in this paper is that the WTO Dispute Settlement System aims to curb unilateralism. No sanctions can be imposed, unless if the arbitration process is through, the purpose of which is to ensure that reciprocal commitments entered should not be unilaterally undone through the commission of illegalities. There are good reasons though, to doubt whether practice guarantees full reciprocity. The insistence on calculating remedies prospectively, and not as of the date when an illegality has been committed, and the ensuing losses for everybody that could or could not be symmetric, lend support to the claim that the WTO regime serves ‘diffuse’ as opposed to ‘specific’ reciprocity. Still, WTO Members continue to routinely submit their disputes to the WTO adjudicating fora, showing through their behaviour that they would rather live in a world where punishment is curbed, than in world where punishment acts as deterrent since full reciprocity would be always guaranteed.