EU and 16 countries agree on interim WTO appellate body following US blockage

The EU and ministers from 16 Members of the World Trade Organization (WTO) agreed to develop a multi-party interim appeal arrangement (24 January) that will allow the participating members to preserve a functioning, two-step dispute settlement system at the WTO in disputes among them, following the US blockage of new appointments to the appellate body since 2017. 

In mid-December 2019 the US decision not to nominate new members of the WTO Appellate Body resulted in its effective paralysis. The US has accused the body of going beyond its jurisdiction and the content of the WTO's treaties. Other members have tried to address some of the US concerns and their own concerns, but as yet there has been no breakthrough.

EC Trade Commissioner Phil Hogan stresses that the arrangement was temporary: "Let me underline again that this remains a contingency measure needed because of the paralysis of the WTO Appellate Body. We will continue our efforts to seek a lasting solution to the Appellate Body impasse, including through necessary reforms and improvements.”

The participating WTO members are: Australia, Brazil, Canada, China, Chile, Colombia, Costa Rica, the European Union, Guatemala, Republic of Korea, Mexico, New Zealand, Norway, Panama, Singapore, Switzerland, and Uruguay.  The multi-party interim arrangement will be based on Article 25 of the WTO Dispute Settlement Understanding (DSU).

The arrangement is a contingency measure and it will only apply until the WTO Appellate Body becomes operational again. The EU believes that an independent and impartial appeal stage, giving the necessary guarantees of rulings of the highest quality, must continue to be one of the essential features of the WTO dispute settlement system.

Commissioner for Trade Phil Hogan said: “This statement testifies to the high importance that the EU and the participating WTO members attach to retaining a two-step dispute settlement process in WTO trade matters. The multiparty appeal arbitration arrangement will guarantee that the participating WTO members continue to have access to a binding, impartial and high-quality dispute settlement system among them."

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