ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The WTO. The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments.

Detailed explanation-2: -Ideally disputes are resolved through negotiations. If this is not possible, WTO Members can request the establishment of a panel to settle the dispute. The panel will issue a report, which can subsequently be appealed before the WTO’s Appellate Body on questions of law.

Detailed explanation-3: -The WTO has one of the most active international dispute settlement mechanisms in the world. Since 1995, 616 disputes have been brought to the WTO and over 350 rulings have been issued.

Detailed explanation-4: -The WTO’s procedure for resolving trade quarrels under the Dispute Settlement Understanding is vital for enforcing the rules and therefore for ensuring that trade flows smoothly. Countries bring disputes to the WTO if they think their rights under the agreements are being infringed.

Detailed explanation-5: -Disputes in the WTO are essentially about broken promises. WTO members have agreed that if they believe fellow-members are violating trade rules, they will use the multilateral system of settling disputes instead of taking action unilaterally. That means abiding by the agreed procedures, and respecting judgements.