Facilis descensus averno: WTO dispute settlement and trade-wars - is the WTO heading where it should?


Dispute Settlement Body
Dispute Settlement Mechanism
international economic law
supranational institution
international trade


Trading is arguably the most important element of our modern society, and its importance in the globalized world is second to none. International commerce nowadays involves more complex supply chains, more sophisticated financial operations and more economic agents. However, states do remain influential factors in that ecosystem, and together they create the framework of international trade. That framework is closely supervised and controlled by none other, than the World Trade Organization. Although, the creation of the WTO did not guarantee, that there would be no tensions between trading nations. Trade wars cause no surprise for an economist or lawyer assessing international trade. But did the most appropriate organization handle these trade wars right? In this article we will succinctly analyse the current framework, and will try to answer whether the Dispute Settlement Mechanism (hereinafter “DSM”) is compatible with all the cases. There is no room for error: if there are certain cases where the DSM only aggravates the problem, then these cases have to be identified and have to be handled with special attention. We are familiar with the disruptive effects of a trade war; hence we are challenged to do our utmost to prevent them – and to rethink what, according to John H. Jackson, has to be a rule-based system.