A new facilitative mechanism at the WTO to address non-tariff measures: Issues for consideration

Introduction

In 2001 Members of the World Trade Organization (WTO) committed, in the context of non-agricultural market access, to negotiate the reduction of “tariffs [and] nontariff barriers, in particular on products of export interest to developing countries.”[2] The reference to non-tariff barriers (NTBs), referred to in this note as non-tariff measures (NTMs), was included at the insistence of developing countries, who are particularly concerned about those NTMs that are structured to eliminate or reduce imports to benefit domestic industries in developed countries.

Indeed, both developed and developing country exporters face a wide range of obstacles in export markets. NTMs identified in an OECD study in 2003 included, among others: technical measures (including, among other things, content and design requirements, labeling and quarantine requirements); internal taxes or charges; customs rules and procedures; competition-related restrictions on market access; quantitative restrictions; subsidies and related government support; public procurement; and trade defense measures (including anti-dumping and countervailing duties, and safeguards).[3]

In the WTO, negotiations on the elimination or reduction of NTMs began with two notification exercises conducted in the Negotiating Group on Market Access (NGMA), in which Members were given the opportunity to notify those NTMs that hindered their exports in various markets. The NTMs notified in the NGMA similarly covered as wide a spectrum of NTMs as identified in the OECD study, including environmental and health measures.[4]

Identifying and classifying NTMs in the NGMA process were intended to allow Members to develop options for their elimination or reduction. But negotiations have been frustrated, partly because Members, particular developing countries, did not have the resources to identify and analyze individual NTMs that are burdensome for their economy. Currently, the specific NTMs notified reflect primarily the NTMs of concern for developed countries, rather than of developing countries and the least developed countries among them.

The European Communities (EC) and a group of developing countries, the NAMA-11 group,[5] are apparently trying to move away from attempting to address specific types of NTMs that are burdensome in export markets. Instead, each is calling for the creation of a new “facilitative mechanism” in the WTO to address all types of NTMs acrossthe- board, arguably covering any measure affecting trade that is not a tariff. Both of the proposed problem-solving mechanisms would allow Members to raise their concerns about NTMs in an expedited and informal process. Solutions would be non-binding and without reference to the legality of the NTM in question. At least in theory, the facilitative mechanism would complement existing WTO dispute resolution mechanisms and, therefore, would not interfere with Members’ rights and obligations to existing WTO Agreements.

Although the Doha Round of negotiations seems to have been indefinitely suspended as of July 2006, it is likely that the idea to create a new “facilitative mechanism” will continue to be discussed within the WTO – most likely based on the models already proposed.

Situating the “Facilitative Mechanism” within the Current WTO Framework

The introduction of a mechanism along the lines proposed by the EC and NAMA-11 would add a new process to the current WTO framework that could dramatically change the functioning and nature of the WTO. Under the current WTO structure, Members who find that they are adversely impacted by an NTM have three options available. First, Members may raise their concerns through notifications and consultations with the Committees under each WTO Agreement that oversee the implementation of Members obligations. For example, both the Agreement on Technical Barriers to Trade (TBT) and Agreement on Sanitary and Phytosanitary Measures (SPS) require that Members notify the respective Committee of their intention to adopt TBT and SPS measures. The Committees’ meetings, the minutes of which are publicly available (albeit with some delay), have served as a platform for discussing a range of NTMs notified, and have influenced Members’ decisions and processes.

Under both the TBT and SPS Agreements, Members must notify other Members of new measures when they either deviate from the relevant international standard, or when no such standard exists, and when the measure may have a significant impact on the trade of other countries.[6] Both agreements further require Members to notify the WTO Secretariat of new measures at an early stage to allow time for other Members to make comments.[7] Finally, both agreements oblige Members to set up national enquiry points where Members can request and obtain information and documentation on regulations.[8]

These notification processes have been insufficient to address developing countries’ concerns. Following a request by developing country Members,[9] the notification process was complemented under the SPS Agreement by additional requirements to aid developing countries in identifying and complying with measures that will affect their exporting industries. When a Member notifies a new or revised existing SPS measure, developing country Members may request special and differential (S&D) treatment. In response to a request for S&D treatment, the notifying Member must attach an addendum to the notification that indicates: (i) whether special and differential treatment has been requested; (ii) which Members requested special and differential treatment; (iii) whether S&D treatment was provided, and if so, the type of treatment provided; and (iv) if not provided, an explanation why S&D was not provided and whether technical assistance was found to address the identified concerns.[10] This new process increases transparency of notification and S&D implementation.

Nonetheless, these provisions fall short of ensuring that Members receive specific information about the types of technical requirements that would be required to comply with the new measures. Moreover, they do not provide Members with a formal process to resolve or influence the adoption of NTMs, in this case SPS measures.

As a result, some Members continue to feel that Committees primarily have the limited role of an “early warning system” where Members can clarify trade policies of other Members, but where there is no adequate mechanism in place for resolving problems relating to NTMs.[11]

Second, above and beyond voicing NTM-related concerns in relevant Committees, Members may bring formal claims under the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), which provides for the binding resolution of trade disputes. Most NTMs fall either under the scope of existing WTO Agreements, including, for instance, the TBT and the SPS Agreements or the 1994 General Agreement on Tariffs and Trade (GATT). Others fall under the scope of agreements currently under negotiation, such as the negotiations on trade facilitation. It is unclear what types of NTMs fall completely outside the scope of the WTO.

Agreements establish disciplines which direct Members to abide by specific rules when they adopt measures affecting trade, including, among others, that measures be nondiscriminatory and that measures be no more trade restrictive than necessary to achieve a legitimate policy objective. This framework arguably allows Members to challenge most NTMs that are adopted without any good reason. However, some Members feel that the dispute settlement process is too expensive and protracted, making it cumbersome and inefficient, particularly for developing countries in need of timely solutions.[12] In addition, some feel a nonadversarial approach would be more fruitful in some instances.

A third option available under the current WTO framework to address concerns with NTMs consists in the good offices, conciliation and mediation mechanisms provided under the DSU. Although linked to formal dispute settlement, they are, in fact, an alternative to the establishment of a panel following the initiation of consultations (the first step in the WTO’s dispute settlement process). While participation in consultations is mandatory, participation in good offices, conciliation or mediation is undertaken solely on a voluntary basis by both of the parties. Because Members must initiate consultations before proceeding with one of alternative dispute resolution mechanisms, Members must give “an indication of the legal basis for the complaint.” [13]

Under good offices, the Director General provides logistical support to “help the parties negotiate in a productive atmosphere.”[14] Conciliation and mediation involve the participation of an impartial third party who contributes to the discussions and negotiations, but under mediation the mediator also proposes non-binding solutions to the parties. [15] To date, the alternative dispute resolution mechanisms available at the WTO have been underutilized. Members proposing to introduce a new mechanism to deal with NTMs feel that the good offices, conciliation and mediation mechanisms provided under the DSU have not shown results.[16]

Presumably in the hope of pleasing their domestic industries, the EC and the NAMA-11 groups of countries have proposed mechanisms that would allow Members to avoid the rules-based system provided in the DSU and the substantive WTO Agreements to deal with NTMs. Instead, the Members would submit themselves to a “facilitative mechanism,” which would focus heavily (or exclusively) on the trade impacts of the measure without any reference to the substantive WTO rules and the measure’s legality thereunder. Both the United States and Japan have questioned the need for a new “dispute” mechanism, suggesting existing mechanisms are adequate to address Members’ concerns. An Overview of the Proposed Horizontal NTM Mechanisms

Both proposals create a new horizontal mechanism independent of the DSU to address non-tariff measures without addressing the legality of the measures. Rather, the focus is on the trade restrictiveness of the measure. This stands in contrast to the legal nature of the DSU process, which requires a “brief summary of the legal basis of the complaint”[17] before a panel can be established, and then requires the complaining party to list the covered agreements affected by the measure in question in the terms of reference before the dispute settlement process begins. In this context, it has been recognized that the progressive judicialization of dispute settlement at the WTO, in contrast to the earlier politics of the GATT 1947, both has served to strengthen a rules-based system and to safeguard the rights of smaller Members.[18]

Neither proposal limits the scope of NTMs that can be addressed in the new mechanism. Both lay out a framework for an expedited process that takes no longer than 90 days (or 60 working days). Both mechanisms provide for facilitation by an impartial facilitator(s) and set out a process that is confidential and secretive. Under both mechanisms Members are encouraged, but not bound, to implement the proposed solutions. Finally, the proposed facilitative mechanisms by the EC and NAMA-11 require mandatory participation of the parties.[19] This is in contrast to the obligations of Members under good offices, conciliation and mediation pursuant to the DSU, where participation is voluntary.

The proposals differ on the level of emphasis placed on ensuring that the needs of developing countries are met. Whereas the EC lists no developing country considerations, the NAMA-11 requires that the process not be “unduly burdensome for developing country Members;” and that the facilitator take the needs of developing country Members into account while making recommendations, including S&D treatment in covered agreements. By comparison, in the consultation phase of the DSU process, which is also designed to operate in 60 days, Members are directed to give special attention to the particular problems and interests of developing country Members, and provisions are in place to extend the time period where developing countries are parties to the dispute. In the panel phase of the DSU process, where a developing country is a party to the dispute, the panel must include one panelist from a developing country when so requested; the panel must “accord sufficient time” for a developing country Member to prepare and present its argumentation.

Overall, the EC proposal creates a process more akin to commercial arbitration, while the NAMA-11 proposal creates a process more akin to mediation. Similar to an arbitral panel or the DSU panel that uses a three to five person panel of trade experts, the EC proposal creates a three- person panel of facilitators. As is common in arbitration agreements, the EC proposal also allows the parties to select a venue of mutual convenience. In contrast, the NAMA-11 proposal provides for a single facilitator and does not address the issue of venue.

A New “Facilitative Mechanism” or Conciliation/Mediation by Another Name?

In many ways, the proposals for a new “facilitative Mechanism” bear a striking resemblance to the mediation mechanism already in place under the DSU process, with two notable differences. First, participation in mediation is voluntary whereas the new mechanism will ostensibly be mandatory; and second, whereas Members must address the underlying legal basis of their concerns in mediation, the new Mechanism will operate without reference to the legality of the measure.

Members will have to consider whether these differences justify the creation of a further bureaucratic layer in the WTO. Creating a mechanism that ensures mandatory participation at first glance appears to be a distinguishing feature that merits the effort of establishing an additional mechanism to address Members’ concerns with NTMs. However, the difference between the two in participation requirements is not that clear. First, although mediation in the DSU process is voluntary, Members must begin with consultations, in which participation is mandatory, before resorting to mediation, so that the parties to the dispute will necessarily already be engaged with one another when one party proposes mediation. Second, it is not at all clear that a Member who is forced to participate in the “facilitative mechanism” will be open to constructive discussion, especially given that the proposed solution under both of the proposed mechanisms is non-binding. Thus, even though both parties would be required to participate in the new mechanism, because the solutions are non-binding, Members still would need to resort to the DSU dispute settlement process, as they would under mediation, if a Member chooses not to implement the proposed solution. In analyzing the effects of an additional mechanism, Members should also consider a scenario in which a Member could be overburdened by “challenges” or requests for facilitation. It is likely that, because the step to resort to a more informal mechanism would be easier to take than under the formal DSU process, more Members will be brought before the new “facilitative mechanism.” Given that facilitation under this mechanism would be mandatory, there is a risk that smaller WTO Members might face a number of parallel requests that are impossible or at least very difficult to deal with given their limited resources. The second major difference between the proposed NTM mechanisms and meditation under the DSU is that the mechanisms completely move away from the rules based system that the Members have agreed to as the foundation of the WTO. In a mediation process under the DSU the parties address their concerns with regard to the rules the Members have agreed upon. The NTM process under the proposed mechanisms, on the other hand, aims to be completely independent from the current WTO rules.

Moving Away from a Rules-based System: Implications for Sustainable Development

The proposals tabled by the EC and NAMA-11 attempt to address concerns of industry groups that export markets are dwindling due to a proliferation of NTMs. They would like to see these barriers eliminated – the faster the better. The proposed mechanisms refer generally to “non tariff barriers.” Consequently, the mechanisms would cover any measure that affects trade and that is not a tariff, and would thus include a wide range of internal measures, many of which fall under the scope of existing agreements or agreements under negotiation. Many NTMs, such as for instance TBT and SPS measures and quantitative restrictions (including import and export bans), pursue important legitimate policy objectives. When considering the adoption of a completely new NTM mechanism, Members should ask whether including such a broad scope of NTMs in a commercial- type of confidential arbitration will defy or promote the goal of the WTO of sustainable development.

In approaching this question, it is important to note that the focus of the inquiry made by the panel or the facilitator would be only on one of the pillars of sustainable development, that is the economic pillar, rather than looking also at the social and environmental pillars. WTO rules, however, explicitly permit Members to pursue social and environmental policies, even where they restrict trade. In particular, the current rules allow Members to take measures to protect human, animal and plant life or health, and the environment. Under the proposed mechanisms, it seems that the panel or the facilitator would not look at the public policy aspect, but rather would focus only on the impacts of the measure on trade. For example, measures such as the EC ban on asbestos or Brazil’s ban on retreaded tires would be considered entirely under the angle of trade restrictiveness. It will be important for Members to ask whether the broad coverage of a new facilitative mechanism, along the lines proposed by the EC and NAMA-11, could endanger legitimate regulations and standards, and generally could compromise the use of domestic legislation for environmental and other public interest objectives.

Developing country Members additionally should think about whether a new facilitative mechanism could serve as a back channel for industrialized countries to present issues that developing countries have resisted classifying as NTMs, such as export restrictions and taxes.[20] Holding bilateral discussions on export restrictions and taxes in a confidential forum where developing countries do not have the benefit of institutional safeguards provided under WTO rules could result in further restrictions on the policy options available for developing countries and have deleterious effects on their development agenda, especially given that developing countries are particularly susceptible to bilateral arm-twisting.[21]

Members also should consider how a move away from a rules based system could undermine the predictability and stability provided by the current framework.[22] The proposed new mechanisms, like the previous diplomatic methods of the GATT, offer a less cumbersome and less expensive process, but could reintroduce the pressures of power politics that the DSU process and a rules based system guard against. By opening discussion to issues independent of the legal basis for the complaint, developing countries lose judicial protection and become vulnerable to the political agenda of developed countries that are in a better position to press their demands and extract concessions relying on carrot and stick bargaining tactics.[23] Unlike traditional diplomatic methods, the new “facilitative mechanism” does require the presence of an impartial third party to facilitate the negotiations. The presence of a third party can serve to deter developed countries from disregarding entirely the needs and concerns of developing countries.[24] However, without the firm commitment of the parties and the linkage of the process to the rules agreed upon by Members in the covered agreements, the proposed mechanism might not be adequate to ensure balanced discussions.

A further point for Members to consider is whether or not a NTM mechanism should be based on transparency and public participation or confidentiality. The two proposals submitted to date stress primarily the element of confidentiality. Complete confidentiality, however, stands in contrast to the current WTO DSU proceedings. While transparency in WTO proceedings has not been institutionalized and proceedings remain to a large extent secretive, submissions and decisions are made public – although with delay. Moreover, panels and the Appellate Body have accepted amicus briefs from non-governmental organizations (NGOs) for their consideration, at least on a discretionary basis. Additionally, there have been efforts to open panel hearings in the DSU to public observation.[25] Under the proposed mechanisms, by contrast, the entire process is intended to be completely secret and decisions and recommendations of the panel of the facilitator will never be made public. While this secretive approach may be adequate to resolve issues between two private entities on purely commercial matters, it seems difficult to defend such an approach in situations where the State is involved and especially in the context of NTMs where public interests are at stake. On the other hand, making recommendations public may lead to influencing a potential formal dispute. In sum, the proposed horizontal mechanisms would likely have extremely broad application and would cover measures aimed at protecting the environment and human health, and at pursuing other legitimate policy objectives. Adopting a mechanism would amount to a move away from a rules-based system, which, while longer and probably more burdensome, can protect the weaker party from armtwisting by the stronger Member. Moving away from rules will probably also result in solutions that focus primarily on trade-restrictiveness, without taking into account the public policy objective pursued by the measures. And finally, the proposed mechanism will be confidential and not transparent, moving further away from a more democratic WTO.

Conclusion

Both industrialized and developing countries have voiced their concerns regarding NTMs adopted in export markets. The proposals submitted by the NAMA-11 group of countries and the EC attempt to address these concerns through a “quick fix” solution, by introducing a horizontal mechanism that does not refer to WTO rules, and that focuses on the trade-restrictive effects of specific NTMs. However, in many cases, the issues are complex and multifaceted. Members must ask themselves whether the characteristics of such a fast-track mechanism are adequate for addressing the extremely wide range of measures covered by the proposed mechanism, especially because the mechanisms would constitute a move away from a rules-based system. This inquiry is particularly important where NTMs are covered that aim at environmental protection and public health. The proposed mechanisms do not appear to consider any aspect or objective other than increased market access through the elimination or reduction of NTMs. Might it be better to limit the scope of application of the proposed mechanisms, either by identifying those NTMs that can adequately be addressed under this type of mechanism, or by carving out certain types of NTMs from the scope of application, such as for instance, environmental or health NTMs?

Also, because neither of the two proposals is geared to specifically address developing country concerns, there is no indication that the mechanism will effectively address developing countries’ concerns regarding NTMs. Developing country Members may want to consider alternative options that are more focused on developing country needs.

For instance, might it be more useful to set up specific processes for Members to address NTMs in a manner similar to the process used in the SPS Committee, which promotes transparency and technical assistance specifically in favor of developing countries?

Finally, developing countries may want to consider whether the move away from a rules-based system may be used to pressure the weaker trading partner into decisions that might inhibit the country’s sustainable development goals.

Endnotes

1 This note was written by Nathalie Bernasconi-Osterwalder (nbernasconi@ciel.org) and Margaret Prystowsky, with input from Daniel B. Magraw, Marcos Orellana, and Sofia Plagakis.

2 World Trade Organization, Ministerial Declaration [Doha Declaration], Nov. 14, 2001, WT/MIN(01)/DEC/1; 41 I.L.M. 746 (2002).

3 Organization for Economic Co-operation and Development, “Overview of Non-Tariff Barriers: Findings From Existing Business Surveys,” (TD/TC/WP(2202)38/FINAL 6 March, 2003), available at http://www.olis.oecd.org/olis/2002doc.nsf/43bb6130e5e86e5fc12 569fa005d004c/da66d9940afce43fc1256ce1005404d7/$FILE/JT 00140440.PDF.

4 For a list of selected NTMs notified see, “Selected notifications of non-tariff barriers which have been listed for negotiation in the Non-Agricultural Market Access WTO talks,” Friends of the Earth International, available at http://www.foe.co.uk/resource/evidence/NTBs_feb_2006.pdf.

5 The members of NAMA-11 are: Argentina, Bolivarian Republic of Venezuela, Brazil, Egypt, India, Indonesia, Namibia, the Philippines, South Africa, and Tunisia.

6 See Agreement on Technical Barriers to Trade, Apr. 15, 1994, WTO Agreement, Articles 2.9 and 5.6, THE LEGAL TEXTS: THE RESULTS OF THE URUGUAY ROUND OF MULTILATERAL TRADE NEGOTIATIONS 121 (1999), 1868 U.N.T.S. 120, available at http://www.wto.org/english/docs_e/legal_e/17- tbt.pdf (last visited June 27, 2006) [hereinafter TBT Agreement]; see also Agreement on the Application of Sanitary and Phytosanitary Measures, Apr. 15, 1994, WTO Agreement, Annex B Paragraph 5, THE LEGAL TEXTS: THE RESULTS OF THE URUGUAY ROUND OF MULTILATERAL TRADE NEGOTIATIONS 59 (1999), 1867 U.N.T.S. 493, available at http://www.wto.org./english/tratop_e/sps_e/spsagr_e.htm (last visited June. 27, 2006) [hereinafter SPS Agreement].

7 See Article 2.9.2, TBT Agreement; see also Annex B Paragraph 5, SPS Agreement.

8 See Article 10, TBT Agreement; see also Annex B, Paragraph 3, SPS Agreement.

9 See Statement by Egypt at the Meeting of 7-8 November 2002, “Comments on the Canadian Proposal,” (G/SPS/GEN/358 15 November 2002).

10 See “Procedure to Enhance Transparency of Special and Differential Treatment in Favour of Developing Country Members,” (G/SPS/33 2 Nov. 2004).

11 See Submission by NAMA-11 Group of Developing Countries, “Resolution of NTBs through a Facilitative Mechanism” (TN/MA/W/68/Add.1 8 May 2006); see also Communication by the European Communities, “Concept Paper: Improving WTO Means to Reduce the Risk of Future NTBs and to Facilitate Their Resolution,” available at, www.globalinfo.nl/filemanager/download/23/060419%20EC%20 proposal%20NTB%20disputes.pdf/.

12 See TN/MA/W/68/Add.1, (noting that it takes up to two years to reach an enforceable decision). In addition, developing countries that do bring successful claims face problems in enforcing WTO rulings which rely on trade retaliation rather than monetary compensation. The smaller market share of developing countries in world trade makes reliance on trade retaliation infeasible. (AMRITA NARLIKAR, THE WORLD TRADE ORGANIZATION: A SHORT INTRODUCTION, 97 (Oxford University Press, 2005).

13 Understanding on Rules and Procedures Governing the Settlement of Disputes, Apr. 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Article 4.4, 1869 U.N.T.S. 401; 33 I.L.M. 1226 (1994).

14 See Dispute Settlement System Training Module, 8.1 Mutually agreed solutions, available at, http://www.wto.org/English/tratop_e/dispu_e/disp_settlement_cb t_e/c8s1p2_e.htm

15 See Id.

16 See Communication by the European Communities, “Concept Paper: Improving WTO Means to Reduce the Risk of Future NTBs and to Facilitate Their Resolution,” available at, www.globalinfo.nl/filemanager/download/23/060419%20EC%20 proposal%20NTB%20disputes.pdf/ (suggesting that the lack of use of good offices, conciliation and mediation is likely because this mechanism is seen as too “close” to the dispute settlement process; and thus members are hesitant to engage in these mechanisms for the same reasons they refrain from using the dispute settlement process (ie. expensive and delayed nature of the process).

17 DSU, Article 6.1 and 6.2.

18 See e.g., Marc L. Busch and Eric Reinhardt, Developing Countries and General Agreement on Tariffs and Trade/World Trade Organization Dispute Settlement, 37 J World Trade 719, 729, 733-34 (2003); John H. Jackson, Dispute Settlement in the WTO: Policy and Jurisprudential Considerations, Discussion Paper No. 419, Research Seminar in International Economics (1998), available at http://www.spp.umich.edu/rsie/workingpapers/wp.html; or Asoke Mukerji, Developing Countries and the WTO: Issues of Implementation, 34 J World Trade 33, 43-44 (2000).

19 The NAMA-11 proposal explicitly states that participation in the process will be mandatory whereas the EC proposal implies the process will be mandatory where it states that the Member to which the request is made “shall favourably consider the request and provide a written reply to the notifying Member…” (Communication by the European Communities) (emphasis added).

20 For more information on developed country proposals, see communication from Japan: “Text-based Contribution for Negotiation on Enhanced Disciplines on Export Restrictive Measures” (JOB(06)/29, 24 February 2006)(advocating improved transparency based on the existing Agreement on Import Licensing Procedures); communications from EC: “Activity Report on Export Taxes to the NGMA” (JOB(05)/321, 8 December 2005)(proposing three options for removing export restrictions, 1) complete elimination of all export taxes, 2) prohibition of export taxes with general exceptions, and 3) binding export taxes at low levels for some specific products of interest to developing countries), and “Negotiating Proposal on Export Taxes” (TN/MA/W/11/add. 6, 27 April 2006).

21 Aside from serving as a valuable source of government revenue, export restrictions are used by developing countries to improve their terms of trade, encourage economic diversification, protect and develop infant industries, and serve as countervailing measures against tariff escalations in developed countries. For a more detailed discussion, see South Centre, Some Reasons Not to Negotiate Export Taxes and Restrictions in the WTO NAMA Negotiations, SC/AN/TDP/MA 6 (May 2006), at http://www.southcentre.org/info/Analysis/ExportTaxesAndRestri ctions.pdf.

22 On the predictability and stability of the WTO’s rules-based system, see for instance, John. H Jackson, Global Economics and International Economic Law, JIEL 1, 7 (1998).

23 See Hansel T. Pham, Developing Countries and the WTO: The Need for More Mediation in the DSU, 9 Harv. Negotiation L. Rev. 331, 347, (Spring 2004) (noting that the neutral adversarial DSU process helps to mitigate the effects of power politics for developing countries because it limits the scope of debate to the legal merits, whereas in bilateral negotiation developing countries are often at a political bargaining disadvantage relative to developed countries because they rely on developed countries for aid and technology transfers, and because bilateral trade makes up a greater percentage of a developing country’s gross domestic product (GDP)).

24 See Id. at 373 (noting that the presence of a third-party mediator encourages parties to adhere to the rules of the DSU: negotiate in good faith, and give special attention to the particular problems of developing country Members).

25 Two cases filed by EC (US – Continued Suspension of Obligations in the EC – Hormones Dispute, and Canada – Continued Suspension of Obligations in the EC – Hormones Dispute) were made open to public observation. See NATHALIE BERNASCONI-OSTERWALDER, ET AL., ENVIRONMENT AND TRADE: A GUIDE TO WTO JURISPRUDENCE 319 (Earthscan London, 2006). 8 August 2006