Free Markets and Social Regulation:A Reform Agenda of the Global Trading System Toward a New International Economic Law
Kluwer Law International B.V., 2003 M01 1 - 217 pages
Discussion of trade barriers has come round-inevitably it seems-to national regimes of regulatory protection. As the author of this important analysis writes: "Global free trade is hard to imagine under circumstances in which each country seeks to regulate domestic social affairs in its own way, without regard to international norms." Indeed, state regulation has the potential to undermine the very legitimacy of the global trading system. A compelling reconciliation between these two paramount values is essential.
Free Markets and Social Regulation: A Reform Agenda of the Global Trading System has a twofold purpose: to consider what has so far been accomplished in this vital mission in the field of international economic law, and to prescribe some solutions to continuing problems. This latter endeavour amounts to a coherent and integrated plan that will enhance the acceptability of free markets to governments, traders, and other stakeholders alike. The challenges analyzed in depth here include the following: the late development in the global trade regime of non-trade policy objectives, which still tend to be treated as mere exceptions to general obligations; the built-in emphasis on products rather than measures ; the novel risks associated with the development of modern technology; the case-by-case approach of WTO jurisprudence, which generally fails to investigate whether the substance of any given domestic regulation is necessary to the policy goals of the state in question; and the "technical and economic feasibility" of complying with international trade obligations. The author conducts his analysis in a broad context encompassing the WTO system, the European Union, and the North American Free Trade Agreement. He finds that the clash, despite the particular institutional characteristics of these various organizations, is a major concern of them all. The jus gentium of international trade, he offers, is an imperative combining the good faith principle with the communitarian duty to cooperate. Exactly how to go about ordering this imperative is what this book is about. Its clear focus on an urgent problem in the development of the global trading system will capture the attention of all practitioners and students of international economic law.
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The new telos embedded in the WTO Charter was also reflected in the interpretive attitude of the Appellate Body, created as part of the new WTO dispute settlement mechanism. Facing typical cases concerning discriminatory domestic ...
Secondly, the chapeau test enables the Appellate Body to conduct a `teleological' interpretation, transcending narrow textualism and reflects the emerging telos of the global trading system. In its interpretation of the very abstract ...
That is to say, Members must meticulously incorporate their international obligations into their respective domestic regimes, in addition to executing the changes prescribed by individual panel and the Appellate Body reports.
As a solution to this dilemma, Chapter II then introduces the new jurisprudence developed by the Appellate Body under the new WTO dispute settlement mechanism. The gist of this new jurisprudence, the `chapeau' test, is analyzed through ...
... issues concerning how a losing party must accept, often reluctantly, a specific formula for reconciling a particular clash between free markets and state regulation, as prescribed by panel and the Appellate Body decisions.