DISPUTE SETTLEMENT SYSTEM (Syllabus: GS Paper 2 – IR)

Context: India, South Africa, and Egypt have expressed concern about the nature of discussions regarding reforms in the dispute settlement system at the World Trade Organization (WTO) ahead of the 13th ministerial conference (MC13) scheduled for February next year.

• The members demanded full, effective, and equal participation in the WTO membership through an inclusive, equitable, and transparent process, preferably under the guidance of the Chair of the dispute settlement body.

Dispute Settlement System (DSS)

• About: Dispute settlement or DSS is regarded by the World Trade Organization (WTO) as the central pillar of the multilateral trading system, and as the organization's "unique contribution to the stability of the global economy".
• Dispute Settlement Body: The DSB of the World Trade Organization (WTO) makes decisions on trade disputes between governments that are adjudicated by the Organization. 
• Dispute Settlement Process

o Consultations between the parties;

o Adjudication by panels and, if applicable, by the Appellate Body;

o Implementation of the ruling, which includes the possibility of countermeasures in the event of failure by the losing party to implement the ruling.

World Trade Organization (WTO)

• Background: The WTO is the successor to the General Agreement on Tariffs and Trade (GATT), which was created in 1947.
• It officially commenced operations on 1 January 1995, pursuant to the 1994 Marrakesh Agreement.
• Created by: Uruguay Round negotiations (1986-94).
• Work: It is the only global international organization dealing with the rules of trade between nations.
• Headquarter: Geneva, Switzerland.
• Membership: Total 164 countries. China became a member only in 2001.