1. The World Trade Organization is the regulatory body that regulates the international trade. It is an intergovernmental organization that was formed in January 1995 with signing of the Marrakesh Agreement. The agreement was a mutual treaty between 124 nations. However, the history of the WTO is not as new as it seems. Its history dates back to 1948, when after the World War II, an agreement of trade was signed by the different nations and it was known as the General Agreement on Tariffs and Trade (GATT). With such a large history spanning over several decades WTO is now the largest international trade and economic organization in the world.
After the world war, the international economic bodies were determined to create an international organization which would govern over the international trade laws and would operate to maintain peace and harmony between the different countries on the basis of trade relation. As the World Bank was formed and the International Monetary Fund was formed, the General Agreement on Tariffs and Trade became the international organization governing the trade policies and formulating trade policies for the different countries.
For many years, GATT worked as the primary body for all the trade regulations in the global scenario. Over the years, there have been several conferences, which, focused on the negotiations between the different countries. Seven such rounds have taken place until 1986 and were primarily focused upon the reduction of the trade tariffs for the easier and profitable trades between the different countries. The Kennedy Round focused on the anti-dumping agreement and other important sectional developments. Similarly, the different rounds focused on the plurilateral agreements, consents, and disagreements. Different policies were re-instated while others were discarded on the wake of the discussions between the member countries.
However, in 1986, the member countries decided that the GATT was no longer adaptive of the new strategies and the new policies that should go in accordance with the globalized world. With such problems, identified, the eighth round of the GATT council took place in Uruguay. The talks between the different member states ranged from the identification of the problems that were earlier decided by the council of members in the 1982 Ministerial Declaration. It was identified that GATT could not manage the problems of the world trade policies with efficiency anymore as it had been doing for the past four decades. The Uruguay Round is considered to be one of the most important trade negotiations that were discussed between the different member states regarding the establishment of the trade policies.
In the Uruguay round, several new policies were discussed and the focus was on the inclusion of new trade policies, which were earlier non-existent in the GATT regime. Sensitive trade sectors such as agriculture and textiles were brought in the dominion of the international trade organization. These aspects escalated the older GATT policies and demanded the reviewing of the age-old laws for aligning with the new world policies and regulations. These chains of discussions and negotiations for eight long years helped in the formulation of new trade policies and practical regulations, which focused on the benefits of the member states according to the new and globalized society. These aspects helped in the creation and establishment of the World Trade Organization (WTO) in 1994. The first formal meeting of the WTO took place in Marrakesh, Morocco and thus the establishing agreement of the formation of the WTO is known as the Marrakesh Agreement.
The Ministerial Conference, is the prime decision making regulatory body of the WTO which meets at a period of two years. The primary work of the Ministerial Conference is to bring together all the member countries and the member trade unions. These conferences are the places of discussion of the contemporary trade practices and the reviewing of all the trade laws that are essential for the successful operations of trade relations. The Ministerial Conference has the right to take decisions on different matters relating to the trade policies and laws. The first ministerial conference took place in Singapore in the year of 1996 and was detrimental in the highlighting of the issues faced by the developing nations as well as the developed nations. These conferences have also discussed arguments about large issues and has been trying to maintain the global policies. The Doha conference marked the beginning of the Doha round, which made the historical decision of granting China’s entry into the world trade organization. This decision marked the new era of China’s economic rise by developing the trade policies with the global market. The Doha Round also marked the lowering of the trade tariffs, which turned to be beneficial for the member states.
The primary objective of establishing the Doha round of development was to discuss the impacts of globalization and include its effect in the trade policies. These developments would help the WTO to determine the enhancements for the poor by decreasing the trade tariffs. The argument between the developed nations and the developing nations regarding the trade tariffs and trade barriers. The liberalization of the trading markets and new laws were predominant in the discussions of the conference. It looked forward to attain the commitments of the member states and strengthen the relationships between them. However, disagreement between several nations paused the development drive of the WTO. The unprecedented stoppage of the conference in 2012, made the future of Doha round uncertain and it has not yet been completed.
WTO functions to develop the trade relations between the different member states globally and formulates different policies to safeguard the rights of the traders. However, there are certain advantages and a disadvantage of the WTO’s functioning.
The advantage of the WTO is that it acts as the overseer of the different activities and trade policies all over the world. Accordingly, it helps the poorer countries against the exploitation of the richer developed countries. The WTO provides the developing nations a platform to voice their opinions about the different trade policies and suggest newer recommendations for the development of free trade across the world. The WTO acts as a negotiator of the different policies and agreements between the nations and determines the tariffs and trade policies in a justified manner so that both the parties are benefitted from the trade practice. The international trade regulations ensure transparency in the trade relations all over the world.
On the other hand, there are also disadvantages in the operation of the WTO. As the organization is an intergovernmental organization, it has a democratic way of running its policies that is by considering the opinions of the different member states. However, in order pass some decisions, the WTO requires majority consent from its member states, which is at times not possible due to the disagreement of ideas between the member states. The conflict of ideas often leads to the stalemate situations in which the matter remains unsolved and no party is benefitted from the decision. Several times arguments lead to the failure of trade negotiations between the countries, where WTO has no role to play but be a mere spectator. Hence, it can be argued that the implementation of the policies and the decision-making is dependent on the consent of the member states.
2. Arbitration is a legal term, which explains the act of settling disputes outside the courts. This process is also called the alternative dispute resolution. These types of disputes are settled in the presence of some persons who are known as the arbiters. The arbitral tribunal acts as the decision makers for the case scenarios and have the right of providing the arbitration award. This award is the legal process of binding the settlement parties in legal resolution and these decisions can be processed in the legal courts at a later period of time.
Commercial disputes form the primary cases for the arbitrary settlements, where international commercial transactions form the most number of cases. In the United States of America, many commercial and employment related disputes are settled by the methods of arbitration. The arbitration clauses might be either voluntary or mandatory. These cases are most of the times settled to produce a speedy result and not wait for the long and hectic legal procedures. There is a basic difference between the mandatory and voluntary arbitration, which distinguishes the commercial disputes from that of the consumer related or employee related disputes. Consumer related disputes or employee related disputes are primarily mandatory clauses, which lead the disputes to be settled outside the court in a compulsory manner. On the other hand, the commercial disputes have a voluntary clause, which allows the commercial disputes to be settled outside the courts to provide a speedy settlement and also reduce the costs of the legal procedures.
The outcome of the arbitration can also be divided into two parts, which are primarily known as the binding or non-binding. In the non-binding procedure, both the parties form a mutual understanding of the dispute and agree to take a middle path where the dispute is settled by agreement. No concrete decision is imposed on any of the parties as there is no concrete winner or loser in these cases. The arbiter works as a mediator who helps both the parties to a settlement point . Both the parties tend to compromise on any of the mutual grounds and accept the clauses of the settlement accordingly. These types of settlement are also not enforceable in the courts later, as both the parties who accept the changes and bind themselves by the compromising regulations do not settle by the establishment of the truth of any of the clauses but by the acceptance of compromise of the dispute.
However, on the other hand the binding clause of arbitrary settlement is more like a court case where the decision of the settlement goes in the favour of one of the parties. The principal decision of the arbiter upholds the clauses of one of the settlement parties and asks the other to abide by the dispute settlement . This practice might seem like the regular court case, but the difference is that in the arbitrary settlement much financial resources and time is saved. Legal procedures take a lot time to settle, but the case is not for the arbitrary settlement. In the binding settlement, one party has to accept the clauses of the party. These types of binding decisions are even enforceable in the court of later, if the parties fail to abide by the decisions of the settlement.
In the arbitrary proceedings the settlements of disputes are presided by an unbiased arbiter. The decision of the arbiter is final in these cases as the decision is taken after judging and reviewing of the settlement clauses that are presented by both the parties. The arbiter balances and asks the parties to settle on the most clause, which ensures proper justification of the case scenario. The decision of the arbiter is final and both the parties must abide by the clauses so that the dispute is legally settled outside the court and put a relieve from the hassles of the court-room.
As has been discussed earlier that are scopes by which the arbitrary decisions are enforceable in the court of law, but at the same time the scopes are very limited. Arbitrary decisions cannot be directly challenged in the court of law as it is a mutual settlement of the disputed parties. However, if one of the parties do not abide by the clauses of the dispute settlement, then only the decision of the arbitrary settlement can be enforceable in the court.
There are certain advantages and disadvantages of the of arbitration settlement. Some of the advantages of the arbitration settlements are:
The disadvantages of the arbitration settlements are:
Australia is a very renowned place to settle international commercial disputes, which ensures global safety of trade relations and promotes ensured commercial relationships, which are often high risk factors in the international investments.
International commercial arbitration is a private method of settling commercial disputes by international parties in the presence of a third party tribunal from a neutral country. This method has been popular for a long period of time as it saves the longer time that is required for settling cases in a legal litigation in the court of justice. Moreover, cross-border disputes requires an investment of a lot of money for the legal procedures to continue. Hence, the businesspersons all over the world choose to settle disputes in a commercial manner, and maintain good relationships with the opposing parties at the same time. The flexibility of the process in Australia, lets businesspersons from all over the world choose Australia as a site of settling disputes in the most preferred manner. It also saves the parties from the hassles of the rigid legal system.
Australia has one of the most stable economies in the world, which allows the country to provide good commercial services to its clients. More industries are choosing to establish trade with Australia due to its stable and profitable economy. This aspect has made Australia’s commercial arbitration dispute settlement industry the most demanding over the other countries in the world. Moreover, Australia provides a transparent and simple judicial framework, which makes it a natural choice for the dispute settlers. In addition, Australia is closely located to the Asian continent, which makes it easier for clients to access the Australian judicial system in a cost benefit way.
References:
Lacarte Muró, Julio, “The History And Future Of The World Trade Organization Bycraig Van Grasstekworld Trade Organization And Cambridge University Press,2013” (2014) 13(04) World Trade Review
Shadikhodjaev, Sherzod, “World Trade Organization—General Agreement On Tariffs And Trade—National Treatment—General Exceptions—Renewable Energy—International Environmental Law” (2017) 111(01) American Journal of International Law
Coppolaro, Lucia, The Making Of A World Trading Power (Routledge, 2016)
Hufbauer, Gary Clyde and Cathleen Cimino-Isaacs, “How Will TPP And TTIP Change The WTO System?” (2015) 18(3) Journal of International Economic Law
Davis, Christina L. and Meredith Wilf, “Joining The Club: Accession To The GATT/WTO” (2017) 79(3) The Journal of Politics
Cunha, Luís Pedro, “The Failure Of The Doha Round And The Development Issue” (2014) 57(1) Boletim de Ciências Económicas
Beverelli, Cosimo, Simon Neumueller and Robert Teh, “Export Diversification Effects Of The WTO Trade Facilitation Agreement” (2015) 76 World Development
WOLFE, ROBERT, “First Diagnose, Then Treat: What Ails The Doha Round?” (2015) 14(01) World Trade Review
Hopewell, Kristen, “Different Paths To Power: The Rise Of Brazil, India And China At The World Trade Organization” (2014) 22(2) Review of International Political Economy
Howse, Robert, “The World Trade Organization 20 Years On: Global Governance By Judiciary” (2016) 27(1) European Journal of International Law
Blackaby, Nigel et al, Redfern And Hunter On International Arbitration (Oxford University Press, 2015)
Rogers, Catherine A, Ethics In International Arbitration (Oxford University Press, 2014)
Elsing, S. H. and J. M. Townsend, “Bridging The Common Law-Civil Law Divide In Arbitration” (2014) 18(1) Arbitration International
Goode, R., “The Role Of The Lex Loci Arbitri In International Commercial Arbitration” (2014) 17(1) Arbitration International
Nazzini, Renato, “THE LAW APPLICABLE TO THE ARBITRATION AGREEMENT: TOWARDS TRANSNATIONAL PRINCIPLES” (2016) 65(03) International and Comparative Law Quarterly
Lampley, Ramona, “‘Underdog’ Arbitration: A Plan For Transparency” [2015] SSRN Electronic Journal
Nielsen, Peter Arnt, “Current Developments?The Recast Brussels I Regulation” (2014) 83(1) Nordic Journal of International Law
Newmark, C. and R. Hill, “Can A Mediated Settlement Become An Enforceable Arbitration Award?” (2014) 16(1) Arbitration International
Stewart, Andrew, “Fair Work Australia: The Commission Reborn?” (2013) 53(5) Journal of Industrial Relations
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