Australia's profile as a trading nation means that it has a strong interest in ensuring that the international trading regime of the WTO is open, equitable and enforceable. The WTO's dispute settlement system, which came into being in 1995, is central to that goal. It is one of the cornerstones of the WTO, and gives WTO members confidence that the commitments and obligations contained in the WTO Agreement will be respected.
There have been over 500 disputes initiated in the WTO since 1995 (although many have not proceeded past the consultations stage) and an important body of international law has developed as a result. The system provides a binding and enforceable mechanism through which WTO members can enforce their trade rights.
How can the WTO help Australian businesses and exporters?
Australian exporters or companies who consider their competitive position is affected by the trade-restrictive actions of WTO member governments are encouraged to advise the Department. When submitting enquiries, firms/companies (or their nominated legal representative) are required to provide details of the problem and the adverse impact on exports or imports. The Department’s Trade and Investment Law Branch will (i) examine the details of the case (ii) determine the nature of the barrier and in particular whether or not it could be a breach of WTO rules and (iii) develop possible options for action.
Such options could include bilateral discussions with the government of the trading partner in question aimed at settling the matter. This approach is often a more efficient and cost-effective way to settle disputes than going to full-blown formal WTO proceedings. Australia's right to take formal dispute action in the WTO creates valuable leverage which can assist in moving disputes toward a resolution.
In cases where there are clear issues of inconsistency with WTO rules and where bilateral consultations have not been successful, there is the option of initiating a formal WTO complaint under WTO dispute procedures. The Minister for Trade, Tourism and Investment would take the final decision on initiating dispute settlement action. When a panel is established, the WTO provides for set timeframes for the completion of the process.
WTO published documents
General information on dispute settlement activities in the WTO can be found on the WTO website.
Australia's involvement in WTO Disputes
Since 1995 Australia has been involved in a number of disputes as a complainant, a respondent and as a third party. Successful complaints brought by Australia have delivered real economic benefits. For example, Australia mounted successful challenges to Korean and United States meat import restrictions which have ensured significant benefits for Australian farmers and the Australian economy more widely.
An overview of Australia's involvement in the WTO dispute settlement system and information on recent developments:
Review of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU)
Negotiations on the review of the Dispute Settlement Understanding (DSU), which are not part of the single Doha Round undertaking, are continuing. A wide range of proposals have been put forward, but progress towards consensus has been slow.