The Nature of Remedies in International Trade Law

Overemphasizing the sanctions aspect of the WTO law, which is partly attributable to an effort to placate the U.S. Congress into the ratification of the Uruguay Round, tends to create a misguided, distorted image of the WTO, one close to a super body reigning and commandeering over its member countries, rather than one akin to a legal community. This paper questions the conventional belief regarding the efficacy of the WTO sanctions in light of remedies and attempts to reconceptualize the true nature of WTO remedies. Part I examines how the concept of remedies has evolved through the history of the old GATT 1947 and the new WTO system. It demonstrates that the private law (contracts) nature of remedies embedded in the early GATT practices has been transformed to public law nature in the subsequent jurisprudence as well as the new WTO system. Part II surveys the various functions and modalities of the current WTO system, such as cessation, compensation, restitution and sanctions, and argues that a remedial hierarchy exists among them, with cessation being prioritized. Part III then discusses the limitations of WTO remedies: first, the perils and paradoxes of sanctions, i.e., eventual manifestation of developmental disparity, mercantilist regression and wrong cases; second, the welfare loss and distributive injustice. Based on these problems raised, Part IV finally attempts to reconceptualize the nature of WTO remedies, focusing on “norm-building” as a communal remedy and also exploring the possibility of a “connection” between WTO remedies and domestic remedies