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 WTO PROCEDURES AND JURISPRUDENCE

THE RELEVANCE OF THE WTO DISPUTE

SETTLEMENT PROCEDURES AND
JURISPRUDENCE IN MALAWI

Tiyanjana Mphepo*

ABSTRACT

The past two decades have witnessed a proliferationof internationaland regional

courts dealing with wide-ranging fields of law Regrettably, except in the human
rights law field, little attention has been paid to internationaldispute settlement in
the study of law and the legal discourse in Malawi. Using the World Trade
Organisation (WTO) dispute settlement as an example, this article demonstrates
that internationaldispute settlement mechanisms andjurisprudenceare relevant
to Malawi in several ways. As Malawi is a member of the WTO, knowledge of WTO
law is critical to ensuring that the country participateseffectively in the system.
Secondly, international law plays an important role as an aid to constitutional
interpretationandas a sourceof law in Malawi. Thirdly,most of the WTO rules and
dispute settlement procedures have been imported into the SADC Protocol on Trade
to which Malawi is a party Some practical suggestions are made as to how the
jurisprudence in international adjudication can be used and incorporated in
Malawian legal discourse.

I INTRODUCTION

The past two decades have seen a proliferation of international and

regional courts dealing with a wide range of fields of law.1 Regrettably,
perhaps with the exception of the jurisprudence from human rights
monitoring bodies and the International Court of Justice (ICJ), insufficient
attention has been given to international dispute settlement in the study of
law and the legal thinking in Malawi. This could be attributed to the limited

LLB (Hons)(Malawi), LLM (Cantab), PhD candidate, Faculty of Law, University of Geneva.
For example, the African Court of Human and Peoples' Rights, the International Criminal
Court (ICC); the International Criminal Tribunal for Rwanda (ICTR), the International
Criminal Tribunal for the Former Yugoslavia (ICTY), the International Tribunal for the Law
of the Sea and the other dispute settlement procedures under the United Nations
Convention on the Law of the Sea; and the dispute settlement system of the World Trade
Organisation.
 (2007) MLJ VOL.1, ISSUE 2

amount of time in which students have to cover the rather extensive public
international law course. In addition, international adjudication might not
be seen as pertinent to the work of most legal practitioners.
Using the World Trade Organisation (WTO) dispute settlement system as
an example, this article argues for greater attention to be given to
international dispute settlement in Malawi. 2 The WTO dispute settlement
system is chosen because it is a fairly new and innovative system of
international dispute settlement and probably the most prominent at
present; it has decided far more cases in its 12-year history than the ICJ; and
it is similar to, and has influenced and will continue to influence, regional
systems of adjudication.
The article is divided into two main parts: the first provides an overview of
the WTO dispute settlement system; the second shows why it is important to
learn about and follow WTO law and dispute settlement. The article
concludes with some suggestions as to how the practice and jurisprudence of
international adjudication could be incorporated into the legal discourse in
Malawi.

II THE WTO DISPUTE SETTLEMENT SYSTEM

A Introduction

The WTO came into being on 1 January 1995 as the successor to the
General Agreement on Tariffs and Trade (GATT) which had been in existence
since 1947. It is the global institution that administers the rules of
international trade. The WTO agreements comprise thousands of pages of
multilateral agreements, plurilateral agreements, 3 numerous
understandings and protocols, and member countries' schedules of
concessions. These agreements, understandings and protocols are annexes to
and integral parts of the Marrakesh Agreement Establishing the WTO
(Marrakesh Agreement).4
The crown jewel of the WTO agreements is the Understanding on Rules
and Procedures Governing the Settlement of Dispute, also called the Dispute
Settlement Understanding (DSU). The dispute settlement system
established under the DSU consists of ad hoc panels as 'courts of first
instance' and an Appellate Body. The creation of the Appellate Body was the

2 'Settlement of international disputes,' 'international dispute settlement,' and 'international

adjudication' are used interchangeably in this article to mean both the procedures and case
law.
3 The plurilateral agreements are binding only on those members that accept them.
4 In this article, the term 'WTO agreements' will be used loosely to mean both the Marrakesh
Agreement and the annexes.
 WTO PROCEDURES AND JURISPRUDENCE

culmination of a progressive development from the diplomatic GATT dispute

settlement system to a more judicial, rule-oriented system under the WTO.
The WTO dispute settlement system is open to WTO members only-a
non-member cannot use the system to resolve its trade disputes. 5 The WTO
dispute settlement system adjudicates on all matters arising under the
agreements listed in Appendix 1 to the DSU, commonly known as the
covered agreements.
Some scholars have doubted whether the WTO dispute settlement
system is a judicial system comparable to the ICJ and the International
Tribunal for the Law of the Sea. 6 Underlying this doubt is the fact that the
WTO dispute settlement reports become binding only after they are adopted
by the Dispute Settlement Body (DSB). 7 Thus, there remains a slight, albeit
very unlikely chance, of the report not becoming binding. 8 However, other
scholars have shown that the panels and the Appellate Body operate and
reach their conclusions in an entirely independent and law-based fashion,
emblematic of all other judicial bodies in the international law sense2

B Compulsory jurisdiction

Judicial settlement of international disputes is premised on the consent

of the states that are parties to the dispute. Consent may be expressed at
different times. In the WTO, becoming a member of the organisation denotes
advance acceptance of the jurisdiction of the WTO dispute settlement
system. A member has a right to bring a dispute against any other member
and the responding member cannot refuse to be bound by the ruling.
There are some instances when WTO members argue that a dispute
settlement panel should not rule on a claim. An example of this is when

5 In contrast, art 35 of the ICJ Statute allows for the participation of states that are neither
parties to the Statute nor members of the UN. For example, Albania in Corfu Channel
(Preliminary objection) 1948 ICJ Rep 15, (Merits) 1949 ICJ Rep 4; Italy in Monetary Gold
Removed from Rome in 1943 1954 ICJ Rep 19; and the Federal Republic of Germany in the North
Sea ContinentalShelf cases 1969 ICJ Rep 3.
6 For example, G Guillaume 'The future of international judicial institutions' (1995) 44
InternationalComparativeLaw Quarterly848-62.
7 The DSB comprises all the WTO members.
8 E-U Petersmarm 'How to promote international rule of law?-Contributions by the WTO
appellate review system' (1998) 1 Journalof InternationalEconomic Law 25, 39.
9 See J Pauwelyn 'The role of public international law in the WTO: How far can we go?' (2001)
95 American Journal of InternationalLaw 535, 553; D McRae 'The WTO in international law:
Tradition continued or new frontier?' (2000) 3 Journalof InternationalEconomicLaw 27, 31-32;
Y Iwasawa 'WTO dispute settlement as judicial supervision' (2002) 5 Journalof International
Economic Law 287, 288; J Lacarte-Muro & others 'Developing countries in the WTO legal and
dispute settlement system: A view from the bench' (2000) 3 Journalof InternationalEconomic
Law 395, 400; M Matsushita & others The World Trade Organisation:Law, practice and policy
(Oxford: Oxford International Law Library, 2002) 43.
 (2007) MLJ VOL.1, ISSUE 2

Argentina unsuccessfully sought to rely on the principle of estoppel when it

requested a WTO panel to refrain from ruling, arguing that Brazil had already
challenged the measures at issue before the MERCOSUR Ad Hoc Arbitral
Tribunal. 10 A similar attempt was made in Mexico-Soft Drinks, where Mexico
requested the panel to decline to exercise jurisdiction. The basis of Mexico's
request was that the claims were inextricably linked to a broader dispute
regarding access of Mexican sugar to the US market under the North
American Free Trade Agreement (NAFTA), so that an arbitral panel under
chapter 20 of the NAFTA was the appropriate forum for the resolution of the
whole dispute. The Appellate Body found that the panel had no discretion to
decline to exercise jurisdiction in a case that had been brought before it."
These failed attempts illustrate how WTO members are locked in by the
compulsory jurisdiction of the dispute settlement system. The compulsory
jurisdiction enhances the status of the WTO dispute settlement system as
arbiter and enforcer of the WTO agreements. Indeed, the global acceptance of
the compulsory WTO dispute settlement system lends credence to
international trade law and elevates the importance of public international
12
law generally.
The compulsory jurisdiction of the WTO dispute settlement system is
more striking when one compares it with that of the ICJ.13 There are several
ways in which the ICJ can assume jurisdiction in a case. Firstly, parties may
submit a dispute under a special agreement in which both parties accept the
jurisdiction of the ICJ. Secondly, a bilateral or multilateral treaty may grant
jurisdiction to the ICJ over the subject matter of the treaty Thirdly, the ICJ
enjoys transferred jurisdiction under article 37 of its Statute so that whenever
a treaty in force requires a matter to be referred to the Permanent Court of
International Justice (PCIJ), the matter has to be referred to the ICJ. 14 There
is also transferred jurisdiction under article 36(5) of the ICJ Statute, which
provides that declarations under the Statute of the PCIJ, which are in force,
shall be deemed as acceptance of the compulsory jurisdiction of the TCJ. 15
Fourthly, jurisdiction may arise under the concept of forum prorogatum after
the initiation of proceedings. In this instance, jurisdiction is exercised when a
party that did not initiate the proceedings acts in a manner that is construed

10 Argentina-DefinitiveAnti-DumpingDuties on PoultryfromBrazil WT/DS241I/R paras 7.17-7.42.

11 Mexico-Tax Measureson Soft Drink and otherBeverages WT/DS308/AB/R paras 40-57.
12 J Cameron & K Gray 'Principles of international law in the WTO dispute settlement body'
(2001) 50 InternationalComparativeLaw Quarterly 248, 250.
13 See arts 36-38 of the ICJ Statute.
14 Ambatielos case (Preliminary objection) 1952 ICJ Rep 28; the South West Africa cases
(Preliminary objections) 1962 ICJ Rep 319, 334-5; and the Barcelona Traction case
(Preliminary objections) 1964 ICJ Rep 6.
15 On this type of transferred jurisdiction, see Military and ParamilitaryActivities in and around
Nicaragua(Jurisdiction) 1984 ICJ Rep 392, 397-411.
 WTO PROCEDURES AND JURISPRUDENCE

16
as an acceptance of the jurisdiction of the ICJ.
None of these four methods qualify as compulsory jurisdiction. The latter
arises only where the parties accept the jurisdiction of the ICJ in advance in
their Optional Clause declarations under article 36(2) of the ICJ Statute.
However, some states have not made Optional Clause declarations while
others have withdrawn their declarations. States that have made Optional
Clause declarations have appended all sorts of reservations to their
acceptance of the ICJ's compulsory jurisdiction. 17 Moreover, the principle of
reciprocity means that the ICJ's jurisdiction in a dispute is applicable only to
the extent that the Optional Clause declarations of the disputing parties
coincide. 18
Finally, the WTO dispute settlement system enjoys not only compulsory
jurisdiction but also exclusive jurisdiction over disputes arising under the
WTO agreements. Article 23 of the DSU requires members to use the DSU
whenever they seek to get a remedy for a violation of obligations or for the
nullification or impairment of benefits under the WTO agreements. WTO
case law has interpreted this provision as an 'exclusive dispute resolution
clause' that requires members to use the WTO dispute settlement system to
the exclusion of any other system. 19 Partly because of this exclusive
jurisdiction, WTO dispute settlement panels cannot refuse to exercise validly
established jurisdiction-even if a dispute could be decided in a forum
outside the WTO.

C Legal standing

WTO members have broad discretion in deciding whether to bring a case

against another member under the DSU. In the absence of an explicit or
implied provision, it could be argued that neither the DSU nor the WTO
Agreement requires a party to show that it has a legal interest before
initiating dispute settlement proceedings in the WTO. In EC - Bananas,the
Appellate Body decided that the US could bring a case against the European
Communities (EC) banana regime even though it did not produce bananas
and had not yet exported any. The Appellate Body said that no legal interest
20
was required in order for a WTO member to bring a case.

16 Corfu Channel (Preliminary objection) 1948 ICJ Rep 15.

17 Malawi is one of the states with an objectionable self-judging reservation.
18 Land and MaritimeBoundary between Cameroon and Nigeria (Preliminary objections) 1998 ICJ
Rep 275, 298-300, contains a good summary of the case law on reciprocity.
19 United States-Sections 301-310 of the Trade Act of 1974 WT/DS152/R para 7.43; United
States-Import Measures on Certain Products from the European Communities WT/DS 165/) para.
6.17-6.19; and European Communities-MeasuresAffecting Trade in Commercial Vessels
WT/DS301/R paras 7.175- 7.195.
20 European Communities-Regime for the Importation, Sale and Distribution of Bananas
 (2007) MLJ VOL.1, ISSUE 2

The Appellate Body statement might be misleading, and cannot be read

as representing the general position in the WTO. It has been argued that
standing is a legal requirement and that a mere legal interest does not suffice:
a WTO Member must be affected by a challenged measure either actually or
potentially.21 This is consistent with general international law, which requires
a state to show legal standing in order for it to commence legal proceedings
before an international dispute resolution body. In the Barcelona Traction case,
the ICJ held that Belgium had no legal standing to bring claims on behalf of
Belgian shareholders of a company because the alleged injury was to the
company itself. The right of diplomatic protection belonged to the company's
national state, which was Canada. 22 Moreover, a case may be declared as
inadmissible if the claimant state has no interest in the case. For instance, in
the South WestAfrica case, second phase, the JCJ held that Ethiopia and Liberia
did not have sufficient interest to bring a case against South Africa with
respect to the latter's administration of South West Africa (currently
Namibia). The reason for the holding was that members of the League of
Nations, under which the mandate was granted, did not have direct recourse
against mandatories but had to use the machinery of the League. The ICJ
23
famously stated that actio populariswas not known to international law.

D Function

Dispute settlement is one of the cornerstones of the multilateral trading

24
system. It gives the WTO agreements some degree of formal enforceability.
The basic function of the WTO dispute settlement system is obviously to
settle disputes between members. The system emphasises prompt and
satisfactory settlement of disputes. It prefers a solution that is mutually
acceptable to the parties and expects members to use the mechanism in good
faith in an effort to resolve their disputes. Article 3.2 of the DSU states that
the WTO dispute settlement mechanism serves to provide security and
predictability to the multilateral trading system. It also serves as a
25
mechanism of governance and guidance.

WT/DS27/AB/Rparas 132-138.
21 J Pauwelyn 'A typology of multilateral treaty obligations: Are WTO obligations bilateral or
collective in nature?" (2003) 14(5) EuropeanJournalof InternationalLaw 907, 941-5.
22 1970 ICJ Rep 3. This principle was confirmed recently in Case ConcerningAhmadou Sadio Diallo
(Republic of Guinea v Democratic Republic of Congo) (Preliminary objections) Judgment of 24
May 2007, available at http://www.icj-cij.org/docket/files/103/13856.pdf (accessed 16 July
2007).
23 ICJ Reports (1966) 6.
24 J Trachtman 'The domain of WTO dispute resolution' (1999) 40 HarvardInternational Law
Journal333.
25 C Ng'ong'ola 'African contributions to dispute settlement negotiations in the World Trade
Organisation: An appraisal' SATRN Working Paper No 8 (February 2004) 44.
 WTO PROCEDURES AND JURISPRUDENCE

However, the power of the WTO dispute settlement system to clarify and
interpret the WTO agreements is not unfettered. The DSU provides that the
findings and recommendations of the panels and Appellate Body may not
add to or diminish the rights and obligations provided under the WTO
agreements. 26 Furthermore, the Appellate Body in US-Wool Shirt and Blouses
held that article 3.2 of the DSU is not meant to encourage the panels or the
Appellate Body to make law by clarifying existing provisions of the WTO
agreements outside the context of resolving a particular dispute. 27 It is clear
therefore that judicial activism is discouraged in the WTO dispute resolution.
Finally, the WTO dispute settlement system does not have the power to
issue advisory opinions. Panels can only be established when there is a
dispute under the covered agreements, and the Appellate Body can only rule
on appeals from the panel reports. Taken together, the lack of advisory
opinion competence, and the use of judicial economy, might limit the
guidance and dispute avoidance capacity of the WTO dispute settlement
system.
28
E The dispute settlement process

A dispute in the WTO arises when one country adopts a trade policy or
29
acts, or omits to act, in a way that is inconsistent with the WTO agreements.
30
As stated earlier, jurisdiction rationepersonae is limited to the WTO members
and jurisdiction ratione materiae3' extends only to issues arising from the
covered agreements.
In the event of a dispute, the first step is for the complaining party to
request consultations with the other member. This is because the preferred
solution is for the members to discuss their problems and settle the dispute
amicably. The consultations may take up to 60 days and, if they fail, the
32
Director General of the WTO may be asked to mediate.
If the consultations and mediation fail, the complainant can request the
establishment of a panel of three international trade experts to hear the
complaint. It takes up to 45 days for a panel to be composed and six months

26 Article 19.2 of the DSU. Similarly, art 3.2 of the DSU prescribes that the recommendations
and rulings of the DSB may not add to or diminish the rights and obligations provided under
the WTO agreements.
27 US-MeasuresAffecting Imports of Woven Wool Shirts and Blousesfrom India WT/DS33/AB/R 19.
28 See, generally, the DSU.
29 WTO 'Understanding the WTO: Settling disputes,' available at http://www.wto.org/english/
thewto e/whatis e/tif e/disple.htm (accessed 18 July 2007).
30 'Personal jurisdiction.'
31 'Subject matter jurisdiction.'
32 Article 5 of the DSU provides for the possibility of resolving a dispute through good offices,
conciliation and mediation if the disputing parties agree. There has hardly been any resort to
these procedures.
 (2007) MLJ VOL.1, ISSUE 2

for it to reach a decision. Other WTO members with a substantial interest in

the matter may request to appear as third parties. Third parties may make a
written and oral submission or they may choose to be passive observers. They
may attend a special session with the panel after the panel's first hearing
with the main parties but they are not allowed to attend the panel's meetings
with the parties. Third parties also receive the first written submissions of the
parties, but not the rebuttal submissions.
The panel operates like a court in that it receives written submissions
from the parties and also conducts oral hearings. After the hearings and
submissions, the panel issues an interim report of its findings and
conclusions to the main parties, giving them a period of 10 days to review the
report. Thereafter, a final report is issued to the parties and, 20 days later,
circulated to the rest of the members of the WTO. Within 60 days of the
circulation, the DSB deliberates the panel report and adopts it as a ruling or
recommendation unless, by consensus, members reject it.33 The consultation
and panel stages are supposed to take not more than one year in total.
Either party, but not third parties, can appeal against the panel's ruling.
Third parties that appeared at the panel stage can also appear at the appellate
phase. Like most domestic courts, the appeal is limited to points of law. It is
heard by three members of a standing seven-member Appellate Body They
can uphold, modify or reverse the panel's legal findings and conclusions.
However, they do not have the authority to remand the case to the panel for
further findings of fact or for another hearing.
Appeals are supposed to last not more than 60 days or, exceptionally, 90
days. The Appellate Body's report is circulated to WTO members and the DSB
has to accept or reject the report within 30 days. As is the case with the panel
report, the rejection of the Appellate Body's report is only possible by
consensus. This means that the report will always be adopted because it is
difficult to secure consensus to reject the report.
When a panel or the Appellate Body concludes that a member's measure
is inconsistent with a WTO agreement, it can recommend that the member
should bring its measure into conformity with that agreement. In addition,
the panel or Appellate Body may suggest ways in which the member could
implement the recommendations. The losing member has to follow the
recommendations and is given a reasonable period of time to comply if
immediate compliance is impractical. If it fails to act within this period, the
losing member is required to request the complainant to negotiate in order to
reach a mutually acceptable compensation. Compensation may take the form

33 If there is an appeal, the panel report is not considered for adoption by the DSB until the
completion of the appeal.
 WTO PROCEDURES AND JURISPRUDENCE

34
of the reduction of tariffs in areas of interest to the complainant.
If no satisfactory compensation is agreed after 20 days, the complainant
can ask the DSB to allow it to impose temporary trade sanctions such as
suspension of concessions given to the losing party or suspension of the
complainants obligations towards the losing party The latter is referred to as
retaliation. Ideally, a member should retaliate in the sector in which a
violation or other nullification or impairment was found. If this fails,
retaliation must be made in respect of other sectors within the same
agreement. So, for example, if a dispute relates to trade in goods under the
GATT, a member should retaliate under the GATT as well. When this is not
practicable or effective, and the circumstances are serious enough, sanctions
may be imposed in another WTO agreement.

F The status of dispute settlement reports

The DSU does not contain an express statement on the precedential value
of WTO dispute settlement reports. In contrast, article 59 of the ICJ Statute
states that 'the decision of the Court has no binding force except between the
parties and in respect of that particular case.' Furthermore, article 38(1) of
the ICJ Statute ranks judicial decisions as subsidiary means for the
determination of the rules of law and not as a primary source of law. These
provisions suggest that there is no doctrine of staredecisis in international law.
Nonetheless, this has not inhibited the ICJ from placing considerable
35
reliance on its previous decisions and those of the PCIJ.
Similarly, the DSU's silence on precedent has not stopped the WTO
dispute resolution bodies from seeking guidance from their previous
decisions. 36 In Japan-Alcohol,the Appellate Body stated that adopted dispute
settlement reports are often considered by subsequent panels and, since they
create legitimate expectations among WTO members, should be taken into
account where they are relevant to any dispute. However, they are not
binding on subsequent panels, the Appellate Body, and members that are not
party to the dispute. Dispute settlement reports that have not been adopted
by the DSB have 'no legal status in either the GATT or the WTO system since
they have not been endorsed through decisions by the Contracting Parties to

34 The DSU neither provides for nor prohibits monetary compensation. Monetary
compensation was offered and accepted in United States-Section 110(5) of the US CopyrightAct,
Recourse to Arbitration under Article 25 of the DSU, WT/DS160/ARB25/1.
35 Japan-Taxeson Alcoholic Beverages WT/DS8/AB/R 14, fn 30.
36 Dispute settlement reports are binding on the parties, who have an international legal
obligation to comply with adopted panel and Appellate Body reports. See J Jackson
'International law status of WTO dispute settlement reports: Obligations to comply or "buy
out"?' (2004) 98(1) American Journalof InternationalLaw 109-125.
 (2007) MLJ VOL.1, ISSUE 2

the GATT or WTO Members.' 37 Nonetheless, the reasoning in such reports

38
may provide useful guidance.

III RELEVANCE TO MALAWI

A Introduction

Having given an overview of the WTO system, I will now explain why it is
necessary to study and follow WTO law and dispute settlement in Malawi. I
have identified three main reasons. Firstly, expertise in WTO law is required
for Malawi to participate effectively in the WTO system. Secondly, the WTO
agreements are part of international law, which serves as a guide to
constitutional interpretation and may be a source of law in Malawi. Thirdly,
there are institutional and normative similarities between the WTO and
regional trade agreements, such as the Southern African Development
Community (SADC). I will explain these points in turn.

B Effective participation in the WTO system

Malawi is a member of the WTO. Article XVI.4 of the Marrakesh

Agreement imposes an obligation on each member to ensure the conformity
of its laws, regulations and administrative procedures with its WTO
obligations. 39 This entails, among other things, revision of old
WTO -inconsistent laws and drafting of new laws where none existed. Private
lawyers are often asked to assist in this task since the Malawian Ministry of
Trade does not have sufficient personnel with legal expertise in WTO rules
and cannot depend entirely on an understaffed Ministry of Justice.40 Thus,
there is need for more lawyers to acquire the necessary expertise in order to
fill the human resources gap. In this regard, a mere reading of the provisions
is not sufficient in order to get a proper understanding of the WTO
agreements. This is so because the WTO agreements are very complex. They
result from extensive negotiations and concession-making, which

37 Japan-Alcohol, above note 35, 14-15.

38 As above.
39 As an LDC, Malawi enjoys some exceptional treatment such as longer transition periods for
the implementation of WTO obligations. Ultimately, however, it still has to ensure
compliance with the WTO rules.
J Chigaru 'Malawi and the multilateral trading system: The impact of WTO agreements,
negotiations and implementation' UNCTAD/DITCfrNCD/2005/18 44, noting (33) that 'the
absence of expertise on matters relating to intellectual property rights has prevented the
Government from revising its existing obsolete legislation. The Registrar General's
Department, which is responsible for the administration of intellectual property legislation
lacks legal expertise on the subject.' Available at http://www.unctad.org/en/docs/
ditctncd2005l8_en.pdf (accessed 19 July 2007).
 WTO PROCEDURES AND JURISPRUDENCE

sometimes leads to 'constructive ambiguity' in the provisions. It is imperative

to know how the provisions are interpreted and applied in the real world
where people work, live and die. This type of knowledge may be obtained
from the case law of the WTO dispute settlement system.
Additionally, expertise in WTO law is needed for the country to
participate effectively in WTO dispute settlement procedures. To date,
Malawi has taken part in two GATT/WTO disputes only. In 1966, Malawi
challenged the United States of America export subsidies on
un-manufactured tobacco, 41 complaining that the subsidies had a deleterious
effect on tobacco prices. A working party was established to resolve the
matter but it appears from the report that no real solution was found.
Nearly four decades later, Malawi was involved in WTO dispute
settlement when Australia, Brazil and Thailand challenged EC sugar
subsidies. 42 Malawi is one of the beneficiaries of the EC sugar regime under
the Sugar Protocol of the Cotonou Agreement between the EC and the
African, Caribbean and Pacific (ACP) countries. Accordingly, Malawi and
several other ACP countries 43 appeared as third parties in the dispute in
support of the EC's position.44 They submitted a joint submission and made
individual oral statements during the panel hearing where each country
highlighted the economic and social importance of the sugar industry. The EC
45
lost both at the panel and appellate stages.
Malawi's limited participation in GATT/WTO dispute settlement is typical
of the least developed countries (LDCs) and African countries. Bangladesh is
the only LDC that has ever been a main party to a WTO dispute;46 other LDCs
have appeared as third parties only. African countries have hardly
47
participated in WTO dispute settlement.
There are several reasons for the low participation of African countries in
WTO dispute mechanism. These include the high legal costs of engaging in
the proceedings; low stakes due to low trade volumes and insignificant share

41 US-Subsidy on Un-manufactured Tobacco, 15S/116, available at

http://www.worldtradelaw.net/reports/gattpanels/ustobaccosubsidypdf (accessed 16 July
2007). Canada, India, Jamaica and Turkey supported Malawi's position.
42 European Communities-Export Subsidies on Sugar WT/DS266.
43 Barbados, Belize, C6te d'Ivoire, Cuba, Fiji, Guyana, Jamaica, Kenya, Madagascar, Malawi,
Mauritius, Saint Kitts and Nevis, Swaziland, Tanzania, Trinidad and Tobago. Brazil, Canada,
China, Colombia, New Zealand, Paraguay and the United States of America were admitted as
third parties in support of the complainants' position.
44 It appears that they hired lawyers to represent them collectively. WTO dispute settlement
reports do not mention names of the lawyers.
45 The dispute is still unresolved because there are disagreements as to whether the EC has
complied with the DSB recommendations.
46 India-Anti-DumpingMeasure on Batteries from Bangladesh WT/DS306. The parties reached a
mutually satisfactory solution during the consultation stage.
47 V Mosoti 'Africa in the first decade of WTO dispute settlement' (2006) 9 Journal of
InternationalEconomic Law 427.
 (2007) MLJ VOL.1, ISSUE 2

of world trade; trading under preferential schemes like the African Growth
Opportunity Act (AGOA), the Everything But Arms (EBA) initiative, 48 and
regional arrangements; the perception that the available remedies are
ineffective for developing countries; 49 and the lack of legal expertise and
50
capacity
Two of these problems-high legal costs and lack of legal expertise-were
partly addressed by the establishment of the Advisory Centre on WTO Law
(ACWL). The ACWL assists developing countries and customs territories by
providing direct assistance in WTO dispute settlement proceedings. It
prepares legal opinions on the strengths and weaknesses of the case, works
together with the country's delegates to prepare for consultations and, if
requested, attends the consultations and works together with the delegates
to draft written submissions and oral statements and prepare answers to the
panel's questions.
However, there is still need for African countries to develop their own
expertise in international trade law to complement the ACWL. For example,
Malawian lawyers could help the private sector and the government to
identify and examine violations at the pre-dispute initiation stage. In order to
do so, they have to keep abreast of the developments in WTO dispute
settlement. Improving expertise will not remove all the hindrances to more
frequent participation in WTO dispute settlement; but it would be imprudent
to wait until all these problems are solved before starting to develop local
expertise.

C Public international law under the Malawi Constitution

The Constitutions of Malawi and Namibia have been described as

'international law friendly' constitutions. 51 This is for a good reason:
international law has a significant role under these Constitutions. One of the
principles of national policy under section 13 of the Malawian Constitution

The 'EBA (Everything But Arms) Regulation,' Regulation (EC) 416/2001, was adopted in
February 2001 by the General Affairs Council of the European Union, granting duty-free
access to imports of all products from least developed countries without any quantitative
restrictions, except to arms and munitions.
49 For example, Antigua and Barbuda is still struggling to get the US to comply with DSB
recommendations after winning in United States-Measures affecting the cross-border supply of
gambling and betting services WT/DS285/AB/R.
50 WTO members are permitted to use private lawyers in dispute settlement proceedings. The
seminal cases on this point are EC-Bananas,above note 20, paras 4-12; Indonesia-Certain
Measures Affecting the Automobile Industry WT/DS54/R paras 14.1-2; and Korea-Taxes on
Alcoholic Beverages WTIDS75R paras 10.26-33.
S T Maluwa 'The role of international law in the protection of human rights under the
Malawian Constitution of 1995' (1995) 3 African Yearbook of InternationalLaw 53, 55. On the
Namibian Constitution, see G Erasmus 'The Namibian Constitution and the application of
international law' (1989-90) 15 South African Yearbook of InternationalLaw 91, 93.
 WTO PROCEDURES AND JURISPRUDENCE

enjoins the state to govern in accordance with the law of nations and the rule
of law. Although this principle is 'directory in nature,' courts are entitled to
have regard to it in interpreting and applying constitutional provisions or any
52
law or in determining the validity of decisions of the executive.
Furthermore, international law is a tool for interpreting constitutional
provisions and can also form part of the law in Malawi.

1 Interpretation

When interpreting the provisions of the Malawi Constitution, courts are

required to have regard, where applicable, to current norms of public
international law.5 3 Thus, public international law can be used to give life to
our Constitution since interpretation is the art of 'extracting from the dead
letter the living thought and placing it before our eyes.' 54 The current norms
of public international law that section 11(2)(c) refers to are not defined.
However, article 38 (1) of the ICJ Statute identifies the following sources of
international law: (a) international conventions, whether general or
particular; (b) international custom, as evidence of a general practice
accepted as law; (c) general principles of law recognised by civilized nations;
and (d) judicial decisions and the teachings of the most highly qualified
publicists of the various nations.
So how is this linked to the WTO? The WTO agreements were born into a
system of international law.5 5 In its first report, the Appellate Body stated that
WTO law should not be read in 'clinical isolation' from public international
law.56 The WTO agreements fall squarely within article 38(1)(a) of the ICJ
Statute and may be resorted to by Malawian courts in the interpretation of
the Constitution. These agreements may be relevant to the interpretation of
economic and social rights, such as the right to development and the right to
engage freely in economic activity. Furthermore, WTO dispute settlement
reports arguably qualify as judicial decisions under article 38(1) (d) of the ICJ
Statute and may therefore be resorted to as subsidiary means for the
determination of rules of international law.
Section 11(2)(c) of the Constitution is mandatory. It states that, where
applicable, courts 'shall have regard to current norms of public international

52 Section 14 of the Constitution.

5 Section 11(2)(c)of the Constitution.
F SavignyLedroitdesobligationsVol2sec 71 (1873), quoted in C Weeramantry'The function of
the International Court of Justice in the development of international law' (1997) 10 Leiden
Journalof InternationalLaw 309, 314.
55 See Pauwelyn, above note 9, for an excellent discussion of this point.
56 UnitedStates-Standardsfor Reformulated and ConventionalGasoline WT/DS2/AB/R. To be precise,
the Appellate Body was talking of the GATT, but the statement applies to all WTO
agreements.
 (2007) MLJ VOL.1, ISSUE 2

law.' 57 Hence, it is incumbent upon the courts to know these current norms,
as dictated by the maxim jura novit curia.58 It is also reasonable to expect legal
practitioners, as officers of the court, to know and cite relevant public
international law where appropriate.

2 Sources of law

While section 11(2)(c) of the Constitution deals with constitutional

interpretation only, some aspects of public international law may also be
applied as sources of law in Malawi because of section 211 of the
Constitution.

i Internationalagreements: Treaties may form part of the municipal law in

Malawi under either section 211 (1) or 211(2) of the Constitution. The former
provides that 'any international agreement entered into after the
commencement of this Constitution shall form part of the law of the
Republic if so provided by or under an Act of Parliament.' The latter stipulates
that 'binding international agreements entered into before the
commencement of this Constitution shall continue to bind the Republic
unless otherwise provided by an Act of Parliament.' Section 211(2) covers
treaties that were binding on the state internationally but were not
incorporated into domestic law by statute. 59
Malawi became a member of the WTO on 31 May 1995, after the
Constitution had already come into force. 60 Therefore, according to section
211 (1) of the Constitution, the WTO agreements would form part of Malawi
law only if provided so by or under an Act of Parliament. There is no such Act
of Parliament. Hence, these agreements are not part of Malawian law. They
are binding on Malawi on the international plane only, in respect of its

57 See Maluwa, above note 51, 76; D Chirwa 'A full loaf is better than half: The constitutional
protection of economic, social and cultural rights in Malawi' (2005) 49(2) Journalof African
Law 207, 235.
58 In explaining the maxim juranovit curia, the ICJ said: 'The Court ... as an international judicial
organ, is deemed to take judicial notice of international law, and is therefore required ... to
consider on its own initiative all rules of international law which may be relevant to the
settlement of the dispute. It being the duty of the Court itself to ascertain and apply the
relevant law in the given circumstances of the case, the burden of establishing or proving
rules of international law cannot be imposed upon any of the parties, for the law lies within
the judicial knowledge of the Court.' See FisheriesJurisdiction cases 1974 ICJ Rep 3 para 17,
cited with approval in Militaryand ParamilitaryActivitiesin and aroundNicaragua (Merits) 1986
ICJ Rep 14, 24-25.
59 Chirwa, above note 57, 233-4.
60 Malawi signed the GATT 1947 on 28 August 1964. According to article XI of the Marrakesh
Agreement, by virtue of being a contracting party to the GATT 1947, Malawi was entitled to
become an original member of the WTO on the date of entry of the Marrakesh Agreement (1
January 1995). However, Malawi deferred its membership to 31 May 1995.
 WTO PROCEDURES AND JURISPRUDENCE

61
relations with other states.
Nonetheless, Malawi has an obligation to ensure that its laws,
regulations and administrative procedures conform to its WTO obligations.
The WTO agreements may therefore be used for developing Malawian law,
especially trade-related legislation and regulations.

ii Customary internationallaw: Section 211(3) of the Constitution provides

that customary international law shall form part of the law of Malawi unless
it is inconsistent with the Constitution or provisions of an Act of Parliament.
This provision does not place any limits on the categories of customary
international law that may apply: it could be universal, regional, or local
62
custom.
WTO case law may explain and provide evidence of customary
international law.63 Article 3.2 of the DSU requires the WTO dispute
settlement system to clarify the WTO provisions in accordance with
customary rules of interpretation of public international law.64 But it is not
just the customary international law rules on treaty interpretation that apply
in the WTO. Other customary international law rules may be applied as long
as the WTO has not contracted out of them. 65 This view is substantiated by a
statement of a dispute settlement panel:

We take note that Article 3.2 of the DSU requires that we seek within the context
of a particular dispute to clarify the existing provisions of the WTO agreements in
accordance with customary rules of interpretation of public international law.
However, the relationship of the WTO Agreements to customary international law
is broader than this. Customary international law applies generally to the
economic relations between the WTO Members. Such international law applies to
the extent that the WTO treaty agreements do not 'contract out' from it. To put it
another way, to the extent there is no conflict or inconsistency, or an expression in
a covered WTO agreement that implies differently, we are of the view that the
customary rules of international law apply to the WTO treaties and to the process
of treaty formation under the WTO.66

61 An Act of Parliament is required for the incorporation of an international agreement into

national law but not for international ratification. The power to negotiate, sign, enter into
and accede to international agreements is vested in the President, sec 89(1)(f) of the
Constitution.
62 Maluwa, above note 51, 70. The Rights of Passageover Indian Territory case 1960 ICJ Rep 6
confirmed the possibility of the existence of local custom.
63 There is also a possibility, albeit very remote, that the provisions of the WTO agreements may
crystallise into customary international law if they meet the criteria enunciated by the ICJ in
theAsylum case 1950 ICJ Rep 266; North Sea ContinentalShelfcases 1969 ICJ Rep 3; and Military
and ParamilitaryActivities in andAgainst Nicaragua (Merits) 1986 ICJ Rep 14.
64 Some of the customary rules of treaty interpretation were codified in the Vienna Convention
on the Law of Treaties (1969).
65 Pauwelyn, above note 9, 543.
66 Korea-MeasuresAffecting Government ProcurementWT/DS 163/R para 7.96.
 (2007) MLJ VOL.1, ISSUE 2

Hence, WTO case law may be instructive as regards the verification of

customary international law.Two examples of WTO cases illustrate this point
fairly well. In EC-Hormones, the EC had relied on the precautionary
principle 67 to impose measures against health risks, arguing that
hormone-treated beef posed a health risk for EC consumers. The EC asserted
that the precautionary principle was a rule of customary international law or
at least a general principle of law. The Appellate Body found it unnecessary
and imprudent to take a position on this point on the basis of the facts of the
case, stating that:

The status of the precautionary principle in international law continues to be the

subject of debate among academics, law practitioners, regulators and judges. The
precautionary principle is regarded by some as having crystallized into a general
principle of customary international environmental law. Whether it has been
widely accepted by Members as a principle of general or customary internationallaw
68
appears less than clear.

At a minimum, this statement casts doubt on the claim that the

precautionary principle has evolved into a principle of general or customary
international law. In the absence of contrary statements from the ICJ and
other international courts, this statement helps to verify the rules of the
customary international law that may be applied as law under section 211(3)
of the Constitution.
In the second case, Mexico-Soft Drinks, the panel and the Appellate Body
found that Mexico's measures and taxes on soft drinks imported from the US
were inconsistent with Mexico's WTO obligations.69 Mexico argued that
since the US had prevented the resolution of the dispute under NAFTA, it
should not be allowed to bring the case to the WTO. This argument relied on
the statement of the PCIJ in the Factoryat Chorzow:

It is, moreover, a principle generally accepted in the jurisprudence of international

arbitration, as well as by municipal courts, that one Party cannot avail himself of
the fact that the other has not fulfilled some obligation or has not had recourse to
some means or redress, if the former Party has, by some illegal act, prevented the
latter from fulfilling the obligation in question, or from having recourse to the

67 Principle 15 of the 1992 Rio Declaration on Environment and Development endorses the
precautionary principle. It states: 'In order to protect the environment, the precautionary
approach shall be widely applied by states according to their capabilities. Where there are
threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a
reason for postponing cost-effective measures to prevent environmental degradation.'
68 European Communities-MeasuresConcerning Meat and Meat Products (Hormones) WT/DS26/AB
paras 123-124.
69 Above note 11.
 WTO PROCEDURES AND JURISPRUDENCE

tribunal which would have been open to him. 70

The Appellate Body doubted the applicability of this principle in the WTO
and stated, obiter,that Mexico's reliance on the principle was misplaced. The
Appellate Body pointed out that the ruling in the Factoryat Chorzow case was
made in a situation in which the party objecting to the exercise of jurisdiction
by the PCIJ was the party that had committed the act alleged to be illegal. In
the present case, the party objecting to the exercise of jurisdiction by the
panel (Mexico) relied on an allegedly illegal act committed by the other party
(US).71 The Appellate Body thereby illustrated the limits of the customary
international law principle in the Factory at Chorz6w.

iii WTO influence on regional trade agreements:72 The WTO has had a
considerable influence on regional trade agreements. The SADC Protocol on
Trade, to which Malawi is a signatory, is an example par excellence. A number
of its provisions import WTO provisions. 73 As such, SADC members might
find useful guidance from the WTO dispute settlement system's clarification
and interpretation of the corresponding WTO provisions.
Furthermore, Annex VI of the SADC Protocol on Trade is modelled on the
DSU; 74 some of its provisions are copied almost word-for-word from the DSU.
Of course, SADC did not copy everything. The most obvious difference is that
there is no appellate system under Annex VI. Other differences include: the
use of private lawyers is expressly permitted under Annex VI but not under
the DSU; third parties have more rights under Annex VI than under the DSU;
and the parties bear the costs of the dispute settlement panel (on top of their
legal costs) under Annex VI, whereas panellists are paid from the WTO
regular budget. Apart from these and few other differences, the similarities
between Annex VI and the WTO DSU are striking.
As mentioned earlier, dispute settlement is a very important aspect of
international trade relations. It is therefore not surprising that SADC
members decided to adopt a mechanism for resolving trade disputes between
SADC member states. Seemingly, the intention was to exclude trade disputes

70 Factory at Chorzow (Germany v. Poland) (Jurisdiction) 1927 PCIJ Series A No 9 31.

71 Mexico - Soft Drinks, above note 11, para 56 and fn 115.
72 I am grateful to Trevor Chimimba for pointing this out to me.
73 J Pauwelyn 'Going global, regional, or both? Dispute settlement in the Southern African
Development Community (SADC) and overlaps with the WTO and other jurisdictions'
(2004) 13 Minnesota Journalof Global Trade 231.
74 Annex VI contains the SADC trade dispute settlement mechanism. See J Bohanes 'A few
reflections on Annex VI to the SADC Trade Protocol' TRALAC Working Paper No 3/2005
17-18, available at http://www.tralac.org/pdf/tralac WP3.2005_Bohanes Jan.pdf (accessed
18 July 2007); Pauwelyn, as above; and also WTO 'Factual presentation: Protocol on Trade in
the Southern African Development Community (SADC)-Report by the Secretariat'
WT/REG176/4 (12 March 2007) 23.
 (2007) MLJ VOL.1, ISSUE 2

from the jurisdiction of the SADC Tribunal and to bestow that jurisdiction
exclusively on the Annex VI dispute settlement mechanism. This intention,
however, was never reduced into writing. There is no provision ousting the
jurisdiction of the SADC Tribunal over trade disputes, and there is no
provision governing the relationship between that tribunal and the Annex VI
mechanism. Consequently, there are conflicting views on whether a SADC
member may bring a trade dispute to the SADC Tribunal.75 Despite this, the
importance of the Annex VI mechanism cannot be overemphasised. As one
author has argued:

Annex VI is likely to become one of the crucial documents for SADC integration
efforts; this is so because experience at the global level (WTO) as well as the
regional level (for instance, the European Communities) teaches that a
rules-based dispute resolution system ... is an essential means of ensuring the
functioning, establishing and maintaining the credibility of such an institution,
both in the eyes of the governments as well as of the business community 76

The Annex VI dispute settlement mechanism is not fully operational and

is yet to develop its own case law. Lawyers and panelists will have to look
elsewhere to find support for their interpretation and application of the
provisions of the SADC Protocol on Trade. In light of the similarities, it is
almost inevitable that the WTO jurisprudence will be cited and relied on in
SADC trade dispute settlement proceedings and will influence the
development of SADC jurisprudence. It is also very likely that SADC dispute
settlement procedures will learn from and be enriched by the established
practices of the WTO dispute settlement system.
Naturally, there are limits on the extent to which WTO practices and
jurisprudence can be relied upon in the SADC context since the SADC
Protocol on Trade intends to be a preferential free trade agreement whereas
the WTO is a global organisation for multilateral trade. Nonetheless, lawyers
familiar with the WTO dispute settlement process and case law will have a
distinct advantage in SADC proceedings.

IV CONCLUSION

This article set out to argue for greater attention to be paid to

international dispute settlement mechanisms and jurisprudence in Malawi.
It has shown that WTO dispute settlement is very pertinent to lawyers in
Malawi. This is so because Malawi is a member of the WTO and requires WTO
law expertise in order to participate meaningfully and effectively in the

75 See Bohanes, as above; cf Pauwelyn, above note 73.

76 Bohanes, as above, 1.
 WTO PROCEDURES AND JURISPRUDENCE

system; WTO law and dispute settlement form part of public international
law which has an important role under the Malawi Constitution, and the
WTO is relevant to the trade dispute resolution mechanisms within SADC.
There are many ways in which lawyers in Malawi can gain expertise in
international adjudication. For example, settlement of international disputes
can be included as a standing section of the undergraduate course in public
international law. The Chancellor College law students' commendable
performances in the recent African human rights and trade moot
competitions could be used to stimulate and sustain interest in international
dispute settlement. Simultaneously, or alternatively, a series of short courses
or seminars on the subject could be organised under the Malawi Law
Society's continuing legal education programme or by the Faculty of Law of
the University of Malawi. Both the Faculty and the Malawi Law Society could
benefit from establishing a working relationship with the United Nations
Office of Legal Affairs, which takes part in implementing the UN programme
of assistance in the teaching, study, dissemination and wider appreciation of
international law. The challenge here falls principally upon the legal
profession as a whole and those involved in the teaching and dissemination
77
of law and doctrine in the academy and elsewhere.

77 Maluwa, above note 51, 79.