This article seeks to understand how dispute occurs between Indonesia and other countries (i.e. Australia and the United States of America) concerning the clove cigarettes, which involves the cigarette company from Indonesia. Using an interpretive-inductive research method, we draw on cases studies from international dispute settlement to understand how the international trade takes place. The results indicate that dispute settlement system allows the developing countries to transform the diplomatic resolution of the case with legal guidance to a quasi-judicialized system to avoid "trade wars".