1. How Strategic Can Ambiguity Be? The Role of Ambiguity in the Quest for Legal Certainty and the Myth of the Toothless Tiger A presentation for the SLSA 2016 Annual Conference Economic Law in Context Theme 5 th April 2016 By Dr. Mervyn Martin and Dr. Maryam Shadman-Pajouh School of Social Sciences, Business and Law, Teesside University,, Middlesbrough TS1 3BA United Kingdom, e-mail:-m.shadmanpajouh@tees.ac.uk, m.martin@tees.ac.uk

2. Context 8th Round of Multilateral Trade Negotiations was the Uruguay Round which launched negotiations for the establishment of the World Trade Organisation In January 1995 the WTO was established According to the WTO, the push for the establishment of the WTO was 3 fold: - Reorienting of policies of developing countries from import substitution - Adoption of market oriented reforms - Fall of communism

3. Context According to academic writers and civil servants from developing countries: - need to include new players - globalisation - the large gap in wealth and power between countries in the international trading system

4. Evidence that WTO is rule-based Shift from the GATT 1947 (Power based to rule based) Unified dispute settlement Single undertaking (single body of law) Paragraphs 3:3 and 4:3 of the Marrakesh Agreement Establishing the WTO Annex 2, the DSU

5. Nature of the WTO Rule-based Forum for negotiations (talk through problems first) Room for negotiations maintained within the DSU

6. Objectives of the DSU Article 3:3 Prompt settlement 3:2 Rulings cannot add or diminish rights or obligations under the Agreements 3:4 Rulings are aimed at achieving a satisfactory settlement in accordance with rights and obligations under the covered Agreements 3:7 In the absence of a mutually acceptable solution, to secure the removal of the measure if found to be inconsistent with provisions of the covered Agreements

7. Recommendations of the DSB Article 19:1 :- bringing measure into conformity, in addition may suggest ways to implement recommendations

8. Methodology Analyse the objectives of the DSU as per provisions in Article 3 and 19 Applied the objectives to WTO case law, in particular the US Shrimp case Derived empirical evidence on whether the objectives of the DSU are being met through WTO jurisprudence

9. Analysis If the DSU is meant to provide a prompt settlement, without adding or diminishing rights or obligations, and securing the removal of the measure if found to be inconsistent with provisions of the covered Agreements is the first objective, where the DSB may suggest ways to implement recommendations. Rulings of the DSB stop at recommending that the measure found to be inconsistent with a member’s obligations be brought into conformity. There are never any suggestions on how this conformity is to be implemented

10. Concept of Strategic Ambiguity This declaratory view: use of the plural “recommendations” in Article 19 of the DSU, suggesting that a panel might make more than one recommendation supports the strategic theory from the use of bringing the measures “into conformity” in that “conformity” is ambiguous enough to achieve the objective of strategic ambiguity. Which is to bring parties to the negotiating table

11. Concept of Strategic Ambiguity The problem is that at some point, talking will need to end especially where a solution cannot be reached, and adversarial litigation begins This is provided for by Article 4 DSU This is also what the rule based system seeks to achieve; off-setting the power imbalance between members

12. Effects of Strategic Ambiguity United States-Import Prohibition of Certain Shrimp and Shrimp Products: Decision:- Negotiating on a multilateral Turtle Conservation Agreement was deemed sufficient to “bringing the inconsistent measure into conformity”

13. Empirical observations from the Shrimp outcome The settlement was not prompt but protracted taking up a number of years The ruling diminished the rights and added obligations on to the complainant The ruling made for a settlement outside the covered agreements Removal of the measure found to be inconsistent with the Agreement was not achieved The DSB did not suggest that removal could be a method of complying with conformity The implication of the decision has extracted all the “teeth” the WTO DSU has been described as having, leaving the WTO a toothless tiger when it comes to enforcing the breach of a covered agreement in the rule based system