The mutually satisfactory temporary arrangement reached between the EC and the US in the WTO US -- Copyright dispute raises a number of legal issues in international, WTO and EC law as well as systemic considerations for the WTO dispute settlement system. It is the first time that monetary compensation has been granted within the terms of Article 22 of the DSU. The agreement is that the US makes a payment of moneys directly to a specific private body in the EC as a temporary arrangement during a period of implementation. The availability and mechanics of monetary compensation as a WTO remedy is currently being debated (see, among many others, 'Financial Compensation in the WTO: Improving the Remedies of WTO Dispute Settlement' in this journal). This brief note examines whether the granting of monetary compensation in this case is consistent with the WTO agreements and, in particular, the most-favoured-nation principle. It also considers whether any inconsistency with the WTO agreements can be justified under WTO rules or general international law. Furthermore, the note outlines the international law and EC law implications of the Community's authorization of a payment to a private party. The conclusion reached is that, while the idea of monetary compensation for private parties may have much support, considerable thought will have to be given to its practical and legal implementation both in WTO and EC law. Copyright 2005, Oxford University Press.
