Say it Loud, Say it Clear — Article 3.10 DSU’s Clear Statement Test as a Legal Impediment to Validly Established Jurisdiction

Forthcoming, Journal of World Trade 49:5

18 Pages Posted: 18 Sep 2014 Last revised: 26 Apr 2015

See all articles by Bregt Natens

Bregt Natens

KU Leuven - Leuven Centre for Global Governance Studies

Sidonie Descheemaeker

University of Barcelona

Date Written: September 17, 2014

Abstract

In paragraphs 53 and 54 of Mexico – Soft Drinks, the Appellate Body (AB) stated that a panel does not have a margin of discretion to decline to exercise validly established jurisdiction, yet continued by implying that legal impediments precluding a panel from exercising its jurisdiction may nonetheless exist. This paper argues that the AB’s statements are both internally coherent and coherent in light of the whole of its jurisprudence by way of two arguments. First, a panel indeed has no margin of discretion to decline to exercise validly established jurisdiction. However, jurisdiction is not automatically validly established. Second, legal impediments precluding validly established jurisdiction exist. These are, it is argued, Articles 3.7 and 3.10 DSU. The paper subsequently develops ‘procedural’ good faith in Article 3.10 DSU as a legal impediment and explains that the test for a violation of this provision demands a ‘clear statement’. While the conditions for the fruitful invocation of a violation of ‘procedural’ good faith as in Article 3.10 DSU have never been met in WTO disputes, we nonetheless consider that case law has cleared the path for a dispute in which this would be possible.

Keywords: WTO, RTA, FTA, jurisdiction, legal impediments, 3.10 DSU

JEL Classification: K33

Suggested Citation

Natens, Bregt and Descheemaeker, Sidonie, Say it Loud, Say it Clear — Article 3.10 DSU’s Clear Statement Test as a Legal Impediment to Validly Established Jurisdiction (September 17, 2014). Forthcoming, Journal of World Trade 49:5. Available at SSRN: https://ssrn.com/abstract=2497368 or http://dx.doi.org/10.2139/ssrn.2497368

Bregt Natens (Contact Author)

KU Leuven - Leuven Centre for Global Governance Studies ( email )

Charles Deberiotstraat 34
Leuven, B-3000
Belgium

Sidonie Descheemaeker

University of Barcelona ( email )

Gran Via de les Corts Catalanes, 585
Barcelona, 08007
Spain

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