Abstract:
The most distinct characteristic of dispute settlement in the World Trade Organization (WTO) is the possibility of authorising a trade sanction against a non-complying member state. However, WTO observers are now questioning whether WTO trade sanctions are really advantageous to the success of the multilateral trading system. Against this background, the present paper first reviews the six disputes in which the WTO authorised trade sanctions, and then makes an appraisal of trade sanctions in terms of their consistency with the general international law of state responsibility and their contribution to the success of the multilateral trading system. The paper finds that trade sanctions are counterproductive and their remedial value is doubtful. Nevertheless, as there are not yet any alternatives that can replace trade sanctions, the conclusion is that the Dispute Settlement Understanding should be amended in order to dilute the stringency of trade sanctions and to conform with the law of state responsibility.