Proposals for reform - to appeal or not is the question?!

News of proposals to reform the WTO from the USTR made headlines today here, here and here. In brief, the proposals covered 5 reform points including rationalising tariffs so that baseline tariffs apply to all members with minimal exceptions, eschew non-regional free trade agreements, end special and differential treatment to large and advanced economies, create new rules to address State led capitalism of China and ending the Appellate Body with a single dispute settlement level at the panel stage. These views are not new and will have to be considered at the WTO when dust settles down after the next DG's selection.

Just a thought on a single stage dispute settlement process and the debate in the ISDS context. 

In international investment arbitration today, there is a single stage ad-hoc arbitral tribunal that decides the disputes arising out of international investment agreements. The criticism has been that this leads to inconsistency in jurisprudence by ad hoc tribunals and there is a need for an appellate mechanism, on the lines of the WTO's Appellate Body, to steady the ship. The EU has also proposed a multilateral investment court. It is also part of the UNCITRAL reform discussions. In the international trade dispute settlement mechanism, there already exists an Appellate Body (or atleast did exist a while ago), but there are calls to revert to a single stage, panel mechanism. 

Two narratives from two different experiences in international economic law and policy streams - trade and investment. While one sees the appellate mechanism as a bane to the system which has exceeded its limits, the other sees it as a panacea for the ills of the ad hoc, inconsistent panel system that has far exceeded its limits in treaty interpretation.

Does this speak to the fact that treaty interpretation itself has pitfalls of interpretative imagination beyond the words of the treaty - be it the panel stage or Appellate Body. As long as there is a body interpreting a treaty and adjudicating on a set of facts, one will perforce have to live with the reality of unexpected outcomes of judicial creativity!