Blueprint for a Plurilateral WTO Arbitration Agreement Under Article 25 of the Dispute Settlement Understanding

There have long been concerns about the growing workload of the World Trade Organization (WTO) Appellate Body. More recently, another more fundamental concern has emerged, which risks exacerbating the Appellate Body's capacity constraints, but goes further to imperil the independence of its members and the legitimacy of its rulings. An apparent design flaw of the WTO Dispute Settlement Understanding (DSU) has been laid bare, namely the consensus requirement for Appellate Body appointments, allowing any single WTO Member to block an appointment, without recourse to voting. One way to avoid the harmful effects of blockage or long delays in appointing Appellate Body members and to generally overcome the decades-old work-load problems could be to make use of arbitration. This paper examines the legal and practical impediments, which may prevent arbitration under Article 25 DSU from operating as an effective alternative means of dispute settlement and explores possible solutions. To this end, the paper surveys the conceptual and historical context of Article 25 DSU, looking in turn at the envisioned use of arbitration in the application of the General Agreement on Tariffs and Trade of 1947 and how arbitration re-emerged in the Uruguay Round negotiations as an alternative means of dispute settlement. Next, the relevant text of the DSU is examined to identify a number of possible design features, which must be developed before such arbitration can become operational, as well as certain other features that may be elaborated on, depending on the preferences of the parties to the arbitration. These features are further discussed in the form of essential elements of an arbitration agreement in respect of Article 25 arbitration