The Imbalances within the WTO Srividhya Ragavan University Of Oklahoma Law Center

Issues for the Hong Kong Meeting Two outstanding issues mark the expectations from Hong Kong Paragraph 6 of the Doha Declaration Issues relating to agricultural subsidies

The issues highlight the imbalance in the WTO process Normative Structure/ Enforcement mechanism sustains the power imbalances and preserves the bargaining inequality Preserves a rule oriented Lockean system rather than the envisaged utilitarian system. Normative Structure & Imbalance

WTO Creating an integrated multilateral trading system by entering into reciprocal and mutually advantageous relationship consistent with their respective needs and concerns at different levels of economic development The Envisaged Utilitarian System

Instead we have created a rule oriented system that is increasingly detached from the objectives With the objective of preserving property The Lockean System

Reduces the line between domestic issues and & market access issues. Does not balance rights & obligations (Art. 7) Allows powerful nations to avoid the rules by not making them Preserves Bargaining imbalances Problems from the Normative Structure

1. Mail Box dispute between India and US. It is a a domestic subject because: investments required to set up the interim mechanisms investments to smoothly transition into the patent regime. Suspends sovereign determination of art 27 (3) [morality] issues (America v. Antigua is another example). Reduces the Line between Domestic & Market Access Issues

Curtailed developing country member’s right to independently determine whether an invention can be allowed into their channels of commerce. Assuming the invention fails the test of patentability after five years, owner enjoys market exclusivity Consumers in developing countries pay a privilege for 5 years for what is in public domain. Cost of the obligations of the interim mechanism not balanced with the benefits At the end of 5 years, countries reexamined all the mail-box applications contributing to backlogs and further degeneration of the system; or allowed unpatentable items to be patented. Balance of Rights & Obligations

Powerful nations can avoid the rules by not making them. Agricultural subsidies Avoiding the Obligations

Upland Cotton Dispute with Brazil Dispute & DSB’s adoption of panel report US agreed to implement by July, 2005 July 2005, US notified that the matter had been sent to Congress and that it would need additional time Brazil requested for countermeasures: Intellectual property suspension Imposing duties on US items US pointed to a bilateral agreement with Brazil DSB ruled that countermeasures will be illegal Preserves Bargaining Imbalances

Other examples include EC Sugar subsidies and the Harmones Dispute which the EU refused to implement. Bargaining Imbalances

Trade sanction Does not work for developing nations Cost ineffective Dispute where Brazil and India chose not to impose sanctions Counter measures – bilateral agreements/ donor country theory Rule based Construction

Recognition of: Reverse interest theory for protectionism Theory of necessity Theory of Trade Benefit – justifying the move from a power based structure Solution

Issues for the Hong Kong Meeting Two outstanding issues mark the expectations from Hong Kong Paragraph 6 of the Doha Declaration Issues relating to agricultural subsidies

The issues highlight the imbalance in the WTO process Normative Structure/ Enforcement mechanism sustains the power imbalances and preserves the bargaining inequality Preserves a rule oriented Lockean system rather than the envisaged utilitarian system. Normative Structure & Imbalance

WTO Creating an integrated multilateral trading system by entering into reciprocal and mutually advantageous relationship consistent with their respective needs and concerns at different levels of economic development The Envisaged Utilitarian System

Instead we have created a rule oriented system that is increasingly detached from the objectives With the objective of preserving property The Lockean System

Reduces the line between domestic issues and & market access issues. Does not balance rights & obligations (Art. 7) Allows powerful nations to avoid the rules by not making them Preserves Bargaining imbalances Problems from the Normative Structure

1. Mail Box dispute between India and US. It is a a domestic subject because: investments required to set up the interim mechanisms investments to smoothly transition into the patent regime. Suspends sovereign determination of art 27 (3) [morality] issues (America v. Antigua is another example). Reduces the Line between Domestic & Market Access Issues

Curtailed developing country member’s right to independently determine whether an invention can be allowed into their channels of commerce. Assuming the invention fails the test of patentability after five years, owner enjoys market exclusivity Consumers in developing countries pay a privilege for 5 years for what is in public domain. Cost of the obligations of the interim mechanism not balanced with the benefits At the end of 5 years, countries reexamined all the mail-box applications contributing to backlogs and further degeneration of the system; or allowed unpatentable items to be patented. Balance of Rights & Obligations

Powerful nations can avoid the rules by not making them. Agricultural subsidies Avoiding the Obligations

Upland Cotton Dispute with Brazil Dispute & DSB’s adoption of panel report US agreed to implement by July, 2005 July 2005, US notified that the matter had been sent to Congress and that it would need additional time Brazil requested for countermeasures: Intellectual property suspension Imposing duties on US items US pointed to a bilateral agreement with Brazil DSB ruled that countermeasures will be illegal Preserves Bargaining Imbalances

Other examples include EC Sugar subsidies and the Harmones Dispute which the EU refused to implement. Bargaining Imbalances

Trade sanction Does not work for developing nations Cost ineffective Dispute where Brazil and India chose not to impose sanctions Counter measures – bilateral agreements/ donor country theory Rule based Construction

Recognition of: Reverse interest theory for protectionism Theory of necessity Theory of Trade Benefit – justifying the move from a power based structure Solution