The WTO adjudicating bodies were busy in 2014, as they issued 22 reports, a net increase of 15 reports when compared to 2013. In fact, the WTO was forced to hire additional staff to work on disputes, since the caseload overwhelmed the existing limited administrative capacity dedicated to dispute settlement.

The China–Rare Earths decision of the Appellate Body addressed two main issues: (i) whether China's obligations not to impose export duties under its accession protocol are subject to exceptions under Article XX of GATT, and (ii) the scope of the exception for China's export quota measures relating to conservation under Article XX(g) of GATT. In accord with its China–Raw Materials decision, the Appellate Body found that there is no textual basis for the application of the Article XX exception to China's export duty obligations. This interpretation exalted a narrow contextual approach over an approach to interpretation that would focus on broader context, object, and purpose. The Appellate Body also approved the Panel's overall approach to determining the availability of the Article XX(g) exception. This approach focused on the design and structure of China's quota measure, but left unresolved important issues, including the extent to which non-conservation purposes may prevent use of the exception and the role of empirical evidence of effects in these determinations. While the Appellate Body found that there is no ‘even-handedness’ requirement in Article XX(g) itself, we argue that the chapeau's requirement of non-discrimination is an appropriate additional criterion for determining whether a policy with a target of reducing extraction of a natural resource satisfies the requirements of Article XX.

The EC–Seal Products dispute raises fundamental questions about the relationship between public morals and international trade. Can WTO members impose trade restrictions based on moral or ethical concerns? Under what conditions can these concerns trump existing trade liberalization commitments? The dispute was filed in 2009 by Canada and Norway against the EU, which in the same year had banned seal products from being imported and placed on its market. According to the EU, the policy was introduced in response to European moral outrage at the inhumane killing of seals. The EU seal regime included a series of exceptions. In particular, it allowed imports of seal products hunted by Inuit or other indigenous communities, as well as imports of seal products processed and re-exported by EU producers. This article discusses the Appellate Body's ruling in EC–Seal Products and some of the key legal and economic issues raised by this dispute.

This paper provides a legal-economic assessment of issues arising in the Panel Report over the WTO's India–Agricultural Products dispute, one of a growing list of disputes arising at the intersection of the WTO and domestic regulatory policy over human, animal, or plant health. This dispute featured allegations that India's import measures applied against avian influenza- (AI-) infected countries over poultry and related products were too restrictive, in light of the World Organisation for Animal Health's (OIE's) scientifically motivated standards and guidelines. We rely on insights from a set of economic models of commercial poultry markets in the presence of negative externalities such as AI. We use such models to motivate critical tradeoffs arising at the intersection of government regulatory regimes designed to deal with AI and how they fit alongside trade agreements such as the WTO and standard-setting bodies such as the OIE, which combine to impose constraints on regulatory and trade policy. While we find the institutional design of the OIE to be well-motivated and we are in broad agreement with the overall thrust of the Panel Report in the dispute, we also highlight a number of subtle issues which pose long-term challenges for the multilateral trading system's ability to balance trade rules with public health concerns.

An agricultural price range system (PRS) aims to stabilize local prices in an open economy via the use of import duties that vary with international prices. The policy is inherently distortionary and welfare-reducing for a small open economy, at least according to the canonical economic model. We offer an explanation for why a government concerned with national welfare may nevertheless implement such a policy when faced with risk aversion and imperfect insurance markets. We also highlight open questions arising out of the Peru–Agricultural Products dispute for the WTO's Appellate Body to address in order to clarify how a PRS consistent with WTO rules could be designed. Finally, we discuss the possibility that a WTO member might resort to a free trade agreement (FTA) to preserve its flexibility to implement a PRS and how an FTA provision of this sort ought to be treated in WTO litigation.

In its Final Modification for Reviews the US DOC announced on 14 February 2012 that it would cease the use of zeroing in the calculation of anti-dumping (AD) margins in all reviews as of 16 April 2012. However, it did not pertain to targeted dumping. In its Final Rule of 22 April 2014, it codified substantial discretion in calculating AD duties, including the use of zeroing, in targeted dumping. Thus the panel in US‒Shrimp II (Viet Nam) erred in not finding ‘as such’ inconsistency by the US with the AD Agreement, despite this not being a targeted dumping complaint. Given the record of the US in complying with zeroing petitions, it should have incurred the burden of proof, which is not satisfied by these pronouncements. Market structure should be used by panels in ‘as applied’ inconsistency determinations. Viet Nam should have included an Article 3 violation in its complaint.

Just as it had in several recent similar disputes, the Panel in China–Autos found several of the challenged issues WTO-inconsistent. We believe virtually all of the deficiencies noted by the Panel could be easily addressed with minor changes to MOFCOM practices. The real significance of this dispute lies in what it tell us about the larger trade policy dance between the US and China. On the one hand, with the series of related WTO disputes the US has demonstrated that China must comply with WTO rules. The more vexing challenge, however, is the apparent tit-for-tat motivation for this and other recent Chinese trade policies, and on this point this dispute does little to change the calculus. The prospective nature of WTO relief makes it almost impossible for the WTO to discourage the type of opportunistic protectionist actions exemplified by this case.

In this paper we claim that, in the WTO Appellate Body (AB)'s ruling in US‒Countervailing Measures (China), the AB decision has not put in question the practice of imposing countervailing duties (CVDs). While the US has formally ‘lost’ the case, a change in the procedures and tests used to motivate the CVD will allow the US to continue using this policy tool on the specified products. From an economic point of view, this is not welcome news since CVDs have the standard distortionary effects of tariffs and could go against environmental goals. From a political-economy point of view, the CVDs in this case appear driven by pressure of domestic manufacturers of clean energy technology and products.

One of the key findings in US-Carbon Steel (India) deals with the appropriate method to determine material injury when imported products are subject to simultaneous anti-dumping and countervailing duty (CVD) investigations. Along with addressing a number of legal issues concerning CVD investigations, the Appellate Body clarified restrictions on cross-cumulation of injury, essentially prohibiting the current US practice, and implicitly raising the burden of proof for parallel claims of dumping and subsidies. This decision is justified on economic grounds, where cumulation imposes a counterfactual scenario against which marginal damages of dumping and subsidies by each country cannot be properly evaluated. However, what the legal rulings by the Appellate Body did not recognize is the economic reality that many like products produced by the firms alleged to have received subsidies were selectively absent from the investigation, which more generally complicates the assessment of injury in dumping and subsidy cases.

After not applying countervailing duty (CVD) law against non-market economies (NMEs) for two decades, the United States opened a CVD investigation against China in 2006. After extensive litigation, a US appeals court ruled that it was illegal to apply CVD law to NMEs. While that ruling was being appealed, the US Congress passed legislation stipulating that the application of CVD law to NMEs starting in 2006 was legal. China challenged this legislation at the WTO. The dispute resulted in a ruling that left open the possibility that the legislation violated the GATT, as well as a finding that the United States must investigate its application of countervailing and antidumping duties against China. This dispute has implications for a number of current WTO debates including: whether Appellate Body rulings create a binding precedent, whether the Appellate Body should have authority to remand cases, and what information should be required in panel requests.