Public Ownership and the WTO in a Post Covid-19 Era: From Trade Disputes to a 'Social' Function

Abstract

Public ownership is closely bound to the need of the government to protect and guarantee the well-being of its citizens. Where the market cannot, or does not want to, provide goods and services, the State uses different tools to intervene, influence, and control some aspects of the private sphere of expression of its citizens in the name and interest of the collectivity. Although, in the past century, this behavior was accepted as one of the expressions of the public authority and part of the social contract, this perception has shifted partially in accordance with the wave of privatization programs initiated in the 1980s and the advent of economic neoliberalism. The aim of the present research is to examine and understand how International Economic Law addresses public ownership. This paper is structured as follows. After the introductory remarks, Section II covers the relationship between public ownership and international economic law. Section II expounds the existing and historical regulatory framework on a state’s interference into the market and the more recent impetus to regulate State-Owned Enterprises (SOEs) in bilateral and regional Free Trade Agreements (FTAs). Section III moves the analysis to China and highlights the challenges to international economic law and WTO Law brought on by Chinese SOEs and the lack of regulation in this context. Lastly, the article analyzes the increase in the use of SOEs to counteract the COVID-19 pandemic and assesses how the relationship between the state and the market will likely change as a result. We argue that in light of the severity of existing global challenges, the “social function” of public ownership and a more proactive role of the State in the economy could enable a more just transition, where the balance between economic development, social values, and a healthy and clean environment will be struck.

Keywords: Public Ownership, World Trade Organization, WTO, International Law, International Economic Law, Business Law, Commercial Law, State-Owned Enterprises, SOEs, China, Free-Trade Agreements, FTAs, Privatization, Global Challenges, Just Transition, COVID-19, Social Function

JEL Classification: K33, K22, K19, D74, I18, F10, F13, F53, F54, F63, F68, M21, O19, O25