Research on the Retaliation System in the WTO's Dispute Settlement Mechanism

Abstract

When conducting trade activities, due to the needs of countries' national interests or due to the general international context, it is inevitable that some acts will be used to disrupt the balance of world trade transactions, thus causing conflicts between two or more nations. If a dispute arises under the framework of the World Trade Organization (WTO) agreement, one party will be deemed to be in breach of the WTO agreement, and the injured party will resort to the WTO Dispute Settlement Body(DSB), and if the "losing party" does not fulfill the agreement, then the "winning party" will request the WTO Dispute Settlement Body to retaliate against it. If the "losing party" does not fulfill the agreement, then the "winning party" will request the DSB to authorize retaliation against it, to stop the behavior of the defaulting party and get certain compensation. Therefore, the retaliation system of the WTO dispute settlement mechanism is of great significance to maintaining the international economic order. The establishment of this system is of great practical significance for resolving disputes between disputing parties and achieving the rebalancing of the international economic order. However, along with the continuous occurrence of various dispute cases, and in the increasingly frequent use of the WTO panel members, member states and academics have gradually recognized certain shortcomings of the retaliation system, resulting in this system for certain violations of the agreement, often helpless. In this regard, all countries have improved the retaliation system under the WTO dispute settlement mechanism from their own or overall interests. This paper discusses the shortcomings of the retaliation system in the WTO dispute settlement mechanism and then makes some suggestions on how to modify and improve it.