| This dissertation is aiming to deliberate on and address one of the most systemic issues:the legal problem resulting from regional trade arrangement under the world trading system.It is widely accepted that the economic globalization and regionalization has become the main two pillars of the current world trade.The economic and trade globalization, in the legal perspective,corresponds to the rule-based multilateral trading system,represented by the WTO agreements with the development and innovation of the GATT during the past more than sixty years;while the economic and trade regionalization corresponds to the bilateral or plurilateral trading system based on the regional trade rules among countries and customs territories,featured by recently flourishing and GATT co-existing regional trade arrangements.This dissertation recognize that economic globalization and economic regionalization have nowadays proved to be the two pillars in promoting the development of world economy and the ecomomic regionalization is, in many aspects,benifical to the development of the economic globalization.However,shared with the same domain of trade,it seems that the multilateral trade system(MTS) and regional trade arrangement (RTA) appeared to have intrinsic and non-conciliatory conflicts.The practice of the world trade in the past half-century has made it pretty clear that the view that MTS and RTA themselves alone would let them in harmony with each other and achieve mutual wins is nothing but an illusion.At the beginning of the year 2005,a Board Committee was eslablished under the entrustment by WTO Director-General Dr. Supachai Panitchpakdi,composing of Peter Sutnerland(former WTO Director-General),Jagdish Bhagwati,John Jackson and other five elitists. As the result of its arduous work,the Board Committee issued a well-known report titled as "The Future of the WTO:Addressing institutional challenges in the new millennium".The report criticized heavily the proliferation of various kinds of RTAs,with the elaboration of the view that the most favored nation principle,as the cornerstone of the WTO multilateral trading system,has been almost eroded and undermined thoroughly,and the edifice of the MTS was facing institutional challenges which never arose before.The rule of GATT Article 24 has been up to now the source of affliction and confusion.Most scholars are of the view that the discipline as stipulated in that article is extremely elastic,unusually complex and full of holes as a result of the ambiguous wording.Some even argue that the article is filled with absurdity and contradiction.The main objective of this paper is to clean up the current rules and to clarify the boundary of the disciplines therein.This is of critical importance in that it is highly relevant to the proper development and the co-existence of MTS and regional trade system.Without addressing the fundamental systemic problems caused by RTAs,without making the RTAs be the building block of the MTS instead of stumbling block,not only the MTS would be of a possibility of falling into collapse,the RTAs as such would be confronted with the probability of self- erosion as well. Further,the Report to the Seventeenth National Congress of the Communist Party of China on Oct.15,2007 put forward the plan of executing the free trade area strategy.How to correctly understand and precisely evaluate the scenario of the proliferation of RTAs,how to evaluate the effects made by RTAs upon the MTS,and how to formulate the specific plan of implementing the strategy of participating in the regional trade arrangement,inter alia,are the significant practical issues need to be addressed urgently in China.The first chapter of this dissertation aims to provide some basic concepts related to the regional trade arrangement,elaborate on the historical evolvement of RTAs,and single out the rationale behind the proliferation of RTAs.Firstly,this chapter attempts to evaluate and define the concepts of the five typical RTAs,i.e.the preferential trade arrangement,free trade area,customs union,common market and economic union.Thereafter,the author draws special attention to the three types of RTAs for this dissertation to go into in depth discussion,i.e. RTAs in the field of trade in goods,RTA in the field of trade in services and RTAs established pursuant to the Enabling Clause.Thirdly,this chapter goes into the depth of various motives of the formation of RTAs. In some circumstances,the motives come from the consideration of economic aspects,while in some special cases the motives stem from purely political consideration.The author is of the view that due to the political aspects behind the formation of RTAs,or,in the alternative, most parts of the motives being of the nature of political concerns,the RTAs appear to be the stumbling block against MTS,rather than the instruments to promote the economic welfare and improve the development of the world trading system.The second chapter is to conduct the legal review of the basic legal system of RTAs in a comprehensive manner,which is intended by the author to be one of the key parts of the whole dissertation.Firstly,the first section of this chapter elaborates in details on the negotiation history of the GATT Article 24.Looking back into the drafting history is of high importance because it will,in the view of the author,definitely contribute to correctly defining the meaning of the RTA rules as stipulated in Article 24 of the GATT.The paper conludes that the real reason for the incorporation of the Article into GATT 1947,through the International Trade Charter negotiations,is the conversion of negotiating position by the United States,and the consideration the United States in making the rules of the future legal system fully satisfy the needs of the free trade agreement negotiation plan between the United States and Canada.The author believes that the plan of concluding the aforesaid free trade agreement by the two leaders of Havana Charter negotiation should be the best and the most appropriate explanation in piercing the veil of the emergence of free trade area as a main kind of RTAs under the surveillance of the GATT.Secondly,the second part of the first section discusses the details of the legal framework of RTA rules under Article 24 of GATT.Three basic requirements could be drawn with regard to the multilateral legal system of RTAs:the first is the obligation of deep regional liberalization (internal benchmark);the second is to be neutral vis-à-vis third parties (extemal benchmark);and the third is the requirement of transparency. The first two requirements are regarded as substantive requirement because of its substantive nature and the last requirement,the requirement of transparency,is viewed as procedural requirement because it touches the procedural aspects of the legal requirements.After addressing the legal issues contained in paragraph 4 of GATT Article 24,this paper look into in turn the legal evaluation in respect of the internal benchmark of the substantive requirement(paragraph 8 of GATT Article 24),the external benchmark of the substantive requirement(paragraph 5 of GATT Article 24) and procedural requirement of transparency(paragraph 7 of GATT Article 24).Thirdly,the third part of this section focuses on the other three legal basis for the establishment of RTAs,i.e.Understanding on the Interpretation of ArticleⅩⅩⅣof the General Agreement on Tariffs and Trade 1994(the "Understanding"),the Enabling Clause,GATs Article 5. As to the "Understanding",the author is of the view that although it attempted to clarify the obligations in the context of Article 24 of GATT, and although it should be admitted that it made some improvements and progress in terms of the procedural aspects,it failed to touch on the systemic and substantive issues of GATT Article 24.With regard to the RTAs on the basis of the Enabling Clause,the paper takes the point that the Enabling Clause is of merits in providing discretion and space for the developing and the least developed members conducting their regional trade arrangements.However,the discipline under the Enabling Clause appears to be far more elastic than that of the GATT Article 24,which in turn would be easily abused and circumvented.In respect of the Article 5 of GATs,titled as "economic integration",since the key concepts of "substantial sectoral coverage","substantially all discrimination" are ambiguous and puzzling,and because of the lack of relevant WTO dispute jurisprudence by the WTO panels and Appellate Body,the problem of ambiguous wording and unclear discipline exist,and has already become another source of affliction and confusion among WTO members,just as the trouble Article 24 of GATT has created.Fourthly,the second section of this chapter discusses and evaluates the practice of RTA surveillance and examination by the GATT/WTO regime.After briefly demonstrating the surveillance history against RTAs by the GATT and Committee on Regional Trade Agreements(CRTA)’s surveillance system under the WTO,the paper comes to the conclusion that the weak performance of the surveillance system under both the GATT and the WTO basically attributes to the unclear discipline contained in the GATT Article 24 on one hand,and restrictive "affirmative consensus" decision making process in adopting recommendations and reports,on the other.While being critical of the failure of the CRTA in conducting its function,this paper sings highly of the contribution made by the New Transparency Mechanism,adopted by the WTO General Council in 2006. In addition,notwithstanding its systemic deficiency,the GATT/WTO dispute settlement mechanism has contributed on a large scale to the clarification and interpretation of the RTA rules under the MTS.In this regard,there mainly four typical cases,i.e.EC - Tariff Treatment on Imports of Citrus Products from Certain Countries in the Mediterranean Region,EEC- Member States’Import Régimes for Bananas and EECI-mport Régime for Bananas during the period of the GATT 1947 and Turkey—Restrictions on Imports of Textile and Clothing Products (Turkey—Textiles) under the WTO.In particular,the jurisprudence made by the panel and the Appellate Body in Turkey—Textiles not only properly shed light on the systemic issue to address the RTA consistency with WTO rules through the WTO dispute settlement mechanism,but presented an essential guidance for the judgment of RTA consistency issue in the future.The third chapter tries to elaborate on the issue of the boundary of the RTA rules under the MTS,which is intended by the author as another critical part of this dissertation.This paper believes that to clarify and define the boundary of RTA rules is essential in that it can provide a clear answer to the question of "what RTAs could do" and "what RTAs shall not do".Firstly,this paper seeks to discuss the legal basis for the theory of the RTA rules boundary and is of the view that,the establishment of the priority and the predominant status of WTO rules over RTA provisions should be the prerequisite in defining the boundary of RTA rules. Secondly,the issue of to what extent the WTO MTS could afford to tolerate the deviation from the WTO rules by the RTAs is also discussed in this chapter.This paper holds that the deviation from WTO discipline by the RTAs is by no means without any boundary and indeed it should have definite and clear boundaries,notwithstanding the facts that the participants of RTAs can take advantage of the exemption as provided in GATT Article 24 to achieve the treatment of deviation from general GATT rules.The scope of the boundary should be construed and determined case by case pursuant to specific factual background.Finally, the paper illustrates three examples to strengthen the analysis of the RTA rules boundary:rules of origin,safeguard measures and dispute settlement.This paper tries to argue that the RTA rules on these three areas should not be regarded as lack of boundary or falling short of rules and disciplines just considering that the GATT Article 24 does not mention them.Instead,in the view of the author,the participants of RTAs still need to conform to the Article 24 of the GATT and some other WTO rules.The fourth chapter of this paper aims to pave the way for settling the institutional difficulties of the WTO multilateral trading system caused by RTAs.The paper argues that the only way should rest with the clarification and reform upon the current rules.Besides,this paper underscores any efforts in addressing such institutional difficulties would subject to the WTO members themselves and their confidence and reliance given to the multilateral trading system.Firstly,this chapter sums up the types of systemic and institutional difficulties,which,in the view of the author,includes three aspects.The first one is the inherent deficiencies of the GATT/WTO rules;the second is the systemic weakness of the WTO/GATT in supervising RTAs;and the third is the special difficulties of the WTO dispute settlement mechanism in addressing the RTA problems.Secondly,the paper tries to figure out the ways in the legal perspective in order to address the aforesaid institutional difficulties.In this regard,the following aspects should be taken into account:clarifying and strengthening the existing WTO/GATT rules,reforming the WTO/GATT rules of RTAs in the long run, enhancing the functioning capacity of CRTA,extending the role of WTO dispute settlement mechanism,etc.Among these aspects,this paper place large emphasis on whether the WTO members are willing devote themselves and to what extent they will make sufficient sacrifice in the new Doha Round negotiations in respect of RTA rules reform.The last chapter,chapter five,aims to elaborate on the issue of China in participating and performing regional trade arrangements.After brief introduction on the practice of China in this respect,the paper goes into the deliberations on how to make China better off in the process of regional integration.The author is of the view that China should,on one hand,implement its free trade area strategy and conducts its participation in the regional economic and trade integration in an accelerated manner, and on the other hand,China should stand firmly to hold on the maintenance of the multilateral trade system and make efforts to ensure the effective surveillance and examination by the WTO against various RTAs. |
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