B.

Institutional Structure
The governing structure of the WTO follows some of the GATT 1947 model, but
also substantially departs from it. At the top there is a MC, which meets no less
than every two years. Next there are not one, but four Councils. The General
Council (GC) has overall supervisory authority, including responsibility for
carrying out many of the functions of the MC between its sessions. In addition,
however, there is a Council for each of the Annex 1 agreements, that is, for Goods,
Services and Intellectual Property. Some Councils have established many
committees for specific subjects. Overall there is some worry that the WTO
structure is too ponderous, sometimes requiring draft documents or reports to
work through various levels of attention before coming to a final decision.

A Dispute Settlement Body (DSB) is established to supervise and implement the

dispute settlement rules in Annex 2. Likewise, there is a TPRM Body for the Trade
Policy Review Mechanism (Annex 3). The membership of each of these Councils
and bodies is open to any WTO Member.25 A number of the poorer countries of the
(p. 44) world feel they lack the resources to establish a ‘mission’ in Geneva for WTO
representation. Also many WTO Members conduct their WTO representation from
a general Geneva- based national mission for international organizations. With the
enormous increase in WTO activity and meetings, such limited missions are clearly
stretched, sometimes having only one or two persons who can devote attention to
the WTO. The US mission has approximately sixteen officials and diplomats, and
the mission of the EU Commission has about thirteen.

C. WTO Decision-Making
Since the GATT 1947 was not viewed as an organization, it is not surprising that it
said little about decision-making. Article XXV GATT 1947 called for one-nation
one-vote and decision by a majority of votes cast, unless otherwise provided. This
GATT 1947 treaty language is remarkably broad. Although cautiously utilized (at
least in the early years), it was the basis for much GATT activity. Most efforts in
the GATT 1947 were accomplished through a process of negotiation and
compromise, with varying degrees of formality and a tacit understanding that
agreement was necessary among countries with important economic influence. In
fact, a ‘consensus’ approach gradually began to be imperative for much of the
activity, even though the word consensus does not occur in the GATT 1947 text—
this, too, is changed in the WTO, with explicit reference to and definition of
‘consensus’.

The GATT 1947 also had measures specifying the procedure and votes for
amending the agreement and for adopting waivers. The WTO Agreement
substantially changes all of this and contains an elaborate matrix of decision-
making procedures, with important constraints around them. Basically there are
five different techniques for making decisions or formulating new or amended
rules of trade policy: decisions on various matters, ‘interpretations’, waivers,
amendments to the agreements, and, finally, negotiation of new agreements. A
variety of non-majority principles are applied, including consensus, but also super-
majority requirements such as Article IX:2 WTO Agreement for the Members to
make a definitive ‘interpretation’ of some Uruguay Round text. This requires a vote
of three-fourths of the membership (not just those present). Treaty amendment
requires—depending on the text—normally a two-thirds vote but will not bind
those not voting to approve, unless the vote is three-fourths. Even in that case,
there is provision for a hold-out Member to withdraw from the organization or
negotiate a special dispensation. Since withdrawal by certain key Members would
probably end the WTO’s effectiveness, such key Members effectively have a veto
regarding amendments.

In addition, it is important to understand the potential of the dispute settlement

procedures, including panel and Appellate Body reports, for bringing about change
or evolution in the trade rules, as can be seen in later chapters of this Handbook.