10th October 2008

Solving cross-retaliation challenges for developing countries

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Negotiations during the Uruguay Round—concluded in 1994—resulted in a more complex era in dispute settlement and retaliation. Since then, developing countries have faced challenges with ‘cross-retaliation’: that is, when a country suspends concessions or other obligations under a trade sector or an agreement that has not been violated by the defending nation.

While WTO Members may be granted permission to cross-retaliate when it is not “practicable” or “effective” for them to impose penalties under the violated agreement, the unbalanced nature of trade relations and the asymmetry of economic power means that, for many developing countries, relying on standard retaliation is not always an option. In these cases, suspension of concessions in TRIPS or GATS may represent a valuable alternative.

However, this option has rarely been used by developing countries. Thus, the complex legal and technical problems, as well as the economic consequences, of resorting to cross-retaliation under the TRIPS Agreement and the GATS demands a comprehensive examination in order for developing countries to make effective use of this option to redress violations of WTO obligations against them.

It is in this vein that ICTSD commissioned Professor Frederick M. Abbott and Dr Arthur E. Appleton to investigate the legal, technical, and economic issues raised in the use of cross-retaliation under TRIPS and GATS, and present possible solutions to these problems. Both experts will present their findings during an ICTSD-organized roundtable, which will examine the options and challenges in the use of cross-retaliation in TRIPS and GATS with a view to enable developing countries to make effective use of it under the WTO Dispute Settlement system.

The forthcoming roundtable, scheduled for 17 October in Geneva, will provide an opportunity to exchange in active dialogue with experts, delegates, and researchers on the challenges and solutions that cross-retaliation poses for developing countries.

Attendance to the event is open, however, given limited seating, all interested parties should contact Sheila Sabune (ssabune@ictsd.ch, or by fax at 41 22 917 80 93) to secure a space in advance.