Vol. 13 No. 5 (May 2003)
INTERNATIONAL TRADE AND ECONOMIC LAW AND THE EUROPEAN UNION, by Sara Dillon. Hart Publishing, 2002. 391pp. $40.00 Paperback. ISBN: 1-84113-113-X
The Uruguay Round, launched in Punta del Este, Uruguay, in September 1986 and concluded in 1994, was the eighth in the series of multilateral trade negotiations held under the auspices of the GATT, which later came to be known as the World Trade Organisation (WTO). It consisted of the most ambitious and far-reaching negotiations in the history of GATT and was a remarkable achievement for multilateral trade, considering the complex range of multilateral agreements that were reached in several new areas. It went far beyond the traditional GATT jurisdiction of dismantling tariffs and non-tariff barriers to exchange of goods. The WTO brought within the scope of international trade negotiations issues such as trade in intellectual property rights (TRIPS), free trade in investments (TRIMS), environmental protection, agricultural products (AA), safeguard agreement, trade in textiles (ATC) and services (GATS), and measures against anti-dumping and subsidies.
INTERNATIONAL TRADE AND ECONOMIC LAW AND THE EUROPEAN UNION, by Sara Dillon, deals with all these relevant legal instruments regulating international trade in different products and services. The book is systematically divided into three distinct parts and further sub-divided into thirteen chapters. The first part deals with the history of GATT; the second part deals with the Uruguay Round Agreements; and the last part is devoted to European Union (EU) trade law.
Dillon’s presentation is both clear and precise. She provides generous references and detailed discussion of a series of interesting and leading cases decided under GATT dispute settlement mechanisms, both by the GATT panel and the Appellate Body as a means to further explain the nature and scope of these legal instruments. The author also skilfully presents the EU and WTO as contrasting models of economic integration. In the last two chapters of the book, the author examines the relationship between the WTO and EU law and the relevance and scope of WTO regulations within the EU as interpreted by the European Court of Justice (ECJ). The aim of the case study approach is to simplify and explain some of the complex EU rules and their influences on external trade relations.
The title and the structure of the book may invite certain minor technical objections. The title suggests that the book’s contents deal with the relations or application of international trade law on the EU. The structural arrangement of the book suggests that international trade law and EU trade law shall be treated separately. It would have been more appropriate, however, to title the book as a comparative study of the international and EU trade law.
In addition, a cursory glance at the book might suggest that the author paid insufficient attention to trade laws of the EU. Out of the 13 chapters, only two are devoted to the study of EU trade law. However, such law regulates economic exchange among the states of the European Union, and nearly all the issues discussed in this book in the context of the international trade law apply to the EU, as its member states are also signatories to the GATT/WTO. To that extent, it would not be fair to suggest that the author down-graded the significance of EU trade law.
The ECJ is not immune to criticism. Indeed, I have found fault with some specific ECJ judgments. For example, I have criticised the ECJ for its failure to confer direct effect to the original provisions in the Treaty of Rome, dealing with the free movement of capital, as an act of judicial timidity (Mohamed 1999).
The question of direct effect of WTO law arises not only within the EU legal regime, but it also occurs in other GATT/WTO countries. The courts in the USA, for example, have consistently refused to grant GATT/WTO direct effect within their legal system, and the level of reception of GATT/WTO laws in many other domestic jurisdictions is not better than the situation prevailing in the EU and USA. As a consequence, Dillon’s criticism of the ECJ for not granting direct effect to GATT/WTO rules is not justified.
In the process of interpreting EU law, the ECJ must strike a balance between various economic and non-economic interests. This is because the objective of the EU, as Dillon notes, is not purely about economics but also involves non-economic values. The ECJ has expanded and enriched EU jurisprudence by its unique judicial innovations, such as the doctrine of direct effect and supremacy of EU law. At the same time, it has also contributed enormously to the protection of non-economic values within the EU, such as in the field of environment. On the other hand, the sole focus of the WTO is about economic law, and non-economic issues are considered to be secondary to the objective of free trade. Unlike EU law, there are no rules adopted under WTO to protect non-economic interests, such as environmental protection. This lack of coherence in the approach towards economic liberalisation between the EU and WTO law was one of the legitimate reasons that the ECJ has not granted direct effect to GATT/WTO rules.
Another minor shortcoming in this excellent piece of work is that there is insufficient critical analysis of the WTO legal instruments and findings of the GATT dispute settlement mechanism. The lengthy discussions of the WTO legal instruments and decisions of the Appellate Board appear to be more descriptive than critical. It would have been more interesting, particularly to legal researchers in this specific subject, if the author had suggested her views on how to further refine and develop GATT/WTO legal instruments and highlighted where further WTO intervention might be useful, and finally to provide more real assessment of the GATT Appellate Body.
Even though WTO countries have reached a high degree of consensus the conduct of international trade and services, as evidenced by the adoption of several trade-related Agreements, a number of non-governmental organisations and a range of interest groups are not at all satisfied. After the dawn of the new millennium, it appears that the WTO is experiencing a crisis of legitimacy. The violent and bloody clashes initially ignited in Seattle (USA) in 1999 were viewed as an extreme form of rejection of any kind of globalisation. Since then it has been almost expected that any international and regional trade conferences, like in Genoa (Italy) and Gothenburg (Sweden), will be met with violent protest.
There has been no serious effort, at either the international or regional level, to assess the causes for such violent reaction to the dismantling of barriers to trade and finance. Is it because globalisation is harmful to the welfare and interests of the vast majority of people—particularly in developing countries? Or, have the beneficial effects of globalisation not reached ordinary people on the street—even in the developed world? Or, is it the failure of the politicians and policy makers to explain the costs and benefits of globalisation in a language that could be understood by ordinary people? These are issues that deserve serious assessment before any steps are initiated to further deregulate international trade and services. Any attempt to cast aside such protests as an act of a few anarchists or unwarranted violent behaviour of a disgruntled minority could do more harm than good with respect to further liberalisation of global trade.
Dillon identifies one of the reasons for such protests is the fact that the complex dispute settlement mechanism and the highly technical nature of the agreements pursued under the WTO system has limited its audience to only a handful of experts. Only specialised lawyers and economists can comprehend the monographs and articles in international trade law. The significance of INTERNATIONAL TRADE AND ECONOMIC LAW AND THE EUROPEAN UNION should be viewed in this context. As the author rightly puts it, the aim of her work is to make the international trade law more easily understood by an average reader, free from technicalities and complexities. A close and careful reading of this book suggests that the author has, to a great extent, achieved this objective.
This is a book which could be recommended to academics, practitioners and students interested not only in GATT/WTO law but also its application within the geographical limits of the EU.
REFERENCES:
Mohamed, Sideek. 1999. EUROPEAN COMMUNITY LAW ON THE FREE MOVEMENT OF CAPITAL AND EMU. The Hague: Kluwer Law International.
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Copyright 2003 by the author,
Sideek
Mohamed.