One Stone One Bird vs. Two Stones One Bird: A Critical Analysis of the Proposed“ Remand”Mechanism in the WTO Dispute Settlement Procedure

One of the main topics being discussed at the Doha Development Agenda “( DDA”) negotiations is the proposed amendment of the Understanding on Rules and Procedures Governing the Settlement of Disputes (“DSU”). The gist of the DSU amendment negotiation is to introduce more procedural guidelines, safeguards and hurdles, much more similar to domestic litigation procedures. One of the key issues being discussed at the DSU amendment negotiation is the introduction of the “remand” procedure. The remand procedure is a mechanism through which the WTO Appellate Body can send a case back to an underlying panel to complete the analysis based on a proper jurisprudence as pronounced by the Appellate Body, or to gather further factual information and complete factual analysis as necessary. Most of the appellate courts in domestic litigation systems do have a remand authority as most of the time this is how a dispute is resolved. Surprisingly, however, the current DSU does not have a remand system. All the Appellate Body is authorized to do is to uphold, modify or reverse a panel decision. As an appellate court, it cannot send the case back to the panel for further discussion. At the same time, the Appellate Body cannot engage in its own fact finding mission. Fact gathering and analysis are entirely within the authority of the panel and the Appellate Body can only review legal errors committed by the panel. So, the combination of the two inherent limitations basically means that the Appellate Body cannot embark on its own factual analysis and only the panel can do it, but that there is no way for the Appellate Body to ask the panel to carry out a new or different factual analysis in the same dispute. If the Appellate Body does not like the panel’s decision, all it can do is to reverse the decision. The problem arises when the Appellate Body reverses the jurisprudence or methodology adopted by the panel. In this kind of situation, the Appellate Body simply reverses the panel’s conclusion and the case terminates once and for all. Since the problem of the lack of remand has been showcased by many disputes, there seems to be consensus among the membership at the DSU negotiation table as far as remand is concerned. In light of the obvious consensus, the chairman of the DSB amendment negotiation provided his own proposal for remand. The proposal, however, seems to have a fundamental problem; it presupposes two separate decisions for the same case when the remand mechanism is utilized. More particularly, the chair’s proposal for the remand system apparently contains fundamental problems which may nullify all the intended benefits of the remand system. Under this scheme, there will be two different sets of reports for the same case under the chair’s text’s scheme. The existence of multiple reports would probably prolong the dispute rather than shorten it, because practically the losing Member will not or cannot implement the previous DSB ruling and recommendations unless and until the subsequent decision is rendered through a remand, at which point it could have a full grasp of the implementation obligation. At the same time, the likely conflict between the two decisions may even hinder final settlement of the dispute. Such being the case, a more appropriate remand system in the WTO dispute settlement procedure context would be the system where only one report is finally adopted. In this system, the Appellate Body procedure may be put on hold during the pendency of the remand procedure. Once the panel passes on its decision on the remand issue to the Appellate Body, it can go on and make a final decision at the end of the day. This system of single and comprehensive decision may better serve the interest of the Members in the WTO dispute settlement procedure.