Dispute Settlement Procedure

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WTO is a rule-based organization with unprecedented powers to resolve trade-related conflicts between nations and to assign penalties and compensation to the parties involved.  The dispute settlement is ensured within the framework of well-defined rule and regulations. Following procedures are adopted to resolve the disputes between the members.

• Procedure of dispute settlement is administered by a Dispute Settlement Body (DSB), which consists of the WTO's General Council.

  • The DSB establishes various panels
  • The DSB adopts panel reports and appellate body reports
  • The DSB maintains surveillance on implementation of rulings and recommendations

• When a member believes that another party has caused violation of the agreement, it can be negotiated informally with that country.  If consultations fail to yield mutually acceptable outcome after 60 days, members may request the establishment of a panel to resolve the dispute. Panels consisting of three individuals with expertise in international trade law and policy will be appointed by DSB.  These panels hear the evidence and present a report to the DSB, recommending a course of action within six months.  The panel can take technical advice from any relevant source.  Only the members have the right to make submissions, but in rare cases, panels can consider consulted submissions from interested non-governmental organizations.

• Third-party member nations may also involve themselves in the dispute settlement process. All deliberations and communications are confidential, and only the final panel reports become part of the public record.

• Once panel reports have been prepared, they are presented to the Dispute Settlement Body, which can either adopt or reject it.  And if one of the parties involved decides to prefer an appeal against the decision, the report will not be considered for adoption until the completion of the appeal.

• In the case of an appeal, a three-person Appellate Body chosen from a standing pool of seven persons will review the panel report if there is any substantial question of law or any irregularity in procedure.  An Appellate Body Report is adopted unconditionally unless the DSB votes by consensus not to accept its findings within 30 days of circulation to the members.

• The members have to comply with the panel ruling within a “reasonable period of time”.  If a member does not comply with the rulings, the DSB can authorize the complainant to suspend commitments and concessions to the violating member.

Last updated on: 21-12-2007