INTRODUCTION

What is the relationship between the World Trade Organization (WTO) dispute settlement mechanism and the dispute settlement mechanism under a regional trade agreement (RTA)? Even before the WTO was established, the North American Free Trade Agreement (NAFTA) had included a provision dealing explicitly with the relationship between its dispute settlement system and the one under the General Agreement on Tariffs and Trade (GATT), and any successor agreements. The problem is therefore not new, but only in recent years has it become more pronounced.

In the first years of the establishment of the dispute settlement mechanism (DSM), it was touted as an example of how an international dispute settlement system should be. It has compulsory jurisdiction; all WTO members had to accept the DSM as part of a single undertaking when they joined the organization. Moreover, with the newly introduced “negative consensus” rule, any WTO member can bring suit against another WTO member without risk of blockage, either at the point of panel establishment or subsequently in the adoption of panel reports. The WTO has an appeal system, in the form of the Appellate Body, whose reports are also saved from blockage by the Dispute Settlement Body (DSB), the supervisory political body comprising all the WTO members, because of the negative consensus rule. It was not long after the establishment of the DSM that a problem that public international lawyers have been increasingly concerned with – the proliferation and fragmentation of international tribunals – started to have an impact on the DSM and its operation.