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Retaliation mechanism in the WTO dispute settlement system (DSS) : a developing country member's perspective

English Abstract

In the era of globalization, it has been proved that the World Trade Organization (WTO) as a multilateral trading system could live up to a successful framework for international economic cooperation. Moreover, it has provided a solid institutional and legal foundation for the trade liberalization. In the WTO Dispute Settlement System (DSS), the retaliation is the last resort in the hierarchy of remedial measures. It is provided in the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU) and the Agreement on Subsidies and Countervailing Measures (SCM). In spite of the success of the DSS in the WTO, not all of the WTO Members can benefit from the retaliation mechanism in the DSS. With respect to this issue, the developing country Members and the developed country Members are the two typical groups with different capacity. Given the increasing influence of developing countries in the global trade and economy, how the retaliation mechanism can be more effective and efficient for the WTO developing country Members deserves an in-depth exploration. Furthermore, the amelioration of the WTO retaliation mechanism will not only promote the implementation of the recommendations and rulings of the DSB but also have a vital impact on the credibility of the WTO in the future. This thesis intends to conduct the research mainly through the case study and attempts to seek the doorway by the reform of the WTO rules of retaliation. Following the analysis of three selected cases related to retaliation, the study finds that the dilemma faced by the developing country Members in retaliation practice includes the legal inflexibility, the economic strength and the political influence. These factors have a great influence on their participation into the retaliation practice. At the same time, the current WTO retaliation mechanism fails to take account of these objective factors. In order to be a more balanced regime, the WTO retaliation mechanism is in need of some adjustment, and it should become more flexible for the developing country Retaliation Mechanism in the WTO DSS: A Developing Country Member’s Perspective v Members by adopting the special and differential treatment (SDT) with some ameliorated retaliatory measures including the offer of third party right status, the unconditional cross retaliation and the increase of the level of retaliation. In addition, it is suggested that proper interpretation of the retaliation rules and establishment of special committee are also approaches to ease the dilemma.

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Deng, Li


Faculty of Law




Foreign trade regulation

International commercial arbitration

Dispute resolution (Law)



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