Dispute settlement panels against India
Dispute settlement mechanism of WTO
- According to the procedure established by the WTO, the first step to resolve a trade dispute is engaging in the consultation process.
- If two trading partners having a dispute could not resolve at that level, one of them can ask for a settlement of the Dispute Settlement Body (DSB) for hearing.
- The DSB’s ruling can be challenged at the appellate body, the highest court for global trade disputes.
WTO’s Appellate Body
- The Appellate Body is a standing committee of seven members that presides over appeals against judgments passed in trade-related disputes brought by WTO members.
- Members of the Appellate Body have four-year terms.
- In the selection process, WTO members follow the consensus principle, which means that the nomination of the Appellate Body members can only proceed smoothly with the agreement of all 164 members of the WTO.
- The Appellate Body must have at least three sitting members to hear an appeal.
Why in News?
- A panel of experts set up by WTO’s Dispute Settlement Body upheld a complaint by China over additional duties slapped by the U.S. on around $250 billion worth of Chinese goods.
- The panel ruled the tariffs were “inconsistent” with global trade rules, and recommended that the U.S. bring its measures into conformity with its obligations.
- The tariffs imposed in 2018 marked the beginning of the trade war between the world’s two largest economies.
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