Marginal Consumers, Marginalized Economics : Whose Tastes and Habits Should the WTO Panels and Appellate Body Consider When Assessing ‘Likeness’?

In Philippines - Distilled Spirits, the Appellate Body of the WTO reaffirmed that the determination of 'likeness' in the GATT should be about the competitive relationship between products. A coherent methodology for the determination of 'likeness' has finally begun to emerge, with the same methodology having been adopted in the GATS (Panel Report, China - Electronic Payments) and the TBT Agreement (Appellate Body Report, US - Clove Cigarettes). Yet, mainstream as the adoption of competition law methodology for the finding of 'likeness' may have become as of recent, its implementation by the adjudicating bodies of the WTO is still inadequate, as demonstrated by the disputes examined in this article. One recurrent problem is the choice of whose consumers' tastes and habits to take into account in the determination of 'likeness'. As shown in the article, competition law has had to deal with the same problem and has developed ways to address common fallacies arising out of relying on evidence regarding the choices of groups of consumers without the groups having been shown to be economically significant. The analysis suggests that the shortcomings of the application of competition law methodology at WTO dispute settlement can be easily addressed in the short-term by raising the awareness of the WTO Members, panels, and the Appellate Body to them, and by turning to competition law for readily available solutions, while increasing the institutional capacity of the adjudicating bodies of the WTO in the long-term