All you need to know about World Trade Organization

Tuesday marks the fifth anniversary of Russia’s accession to the World Trade Organization (WTO) on August 22, 2012.

The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of this site. This site does not give financial, investment or medical advice.

MOSCOW (Sputnik) – The WTO is an international organization set up to liberalize international trade and regulate trade and political relations between member countries. The WTO is a legal successor to the General Agreement on Tariffs and Trade (GATT) that was enacted in 1947.

The organization was established under a system of mutual agreements, the so-called Uruguay round, between GATT member countries.

The WTO helps streamline the trade process under a system based on certain regulations; it objectively resolves trade disputes between governments; it also organizes trade talks. This activity hinges on 60 WTO agreements dealing with all main legal norms in the area of international commerce and trade. These agreements are based on various principles, including non-discrimination (the most-favored nation regime and national regime provision), more lenient trade terms, promoting competition and extra provisions for the least developed countries. The WTO also aims to fight protectionism.

In November 2015, the WTO had 162 member countries. However, at the Ministerial Conference in the Kenyan capital of Nairobi on December 15-18, Afghanistan and Liberia were accepted as the 163rd and 164th WTO members.

Over 20 countries and 60 international organizations, including the United Nations, International Monetary Fund (IMF) and World Bank, as well as regional and commodity associations, have observer status with the WTO.

Observer countries include Azerbaijan, Belarus, Iran, Iraq, Serbia, Uzbekistan and others. An overwhelming majority of observer countries are at different stages of the WTO accession process.

The multi-stage WTO accession procedure usually lasts between five and seven years.

During the first stage, members of special working parties assess a membership applicant’s economic mechanism and trade policy regime during multilateral discussions to see if the applicant meets WTO norms and regulations. Consultations and talks on WTO membership terms are subsequently launched. As a rule, these bilateral consultations and talks involve all interested countries that are members of a working party.

First, the talks deal with commercially important concessions that a prospective member country will be ready to make, while allowing WTO members to enter its markets.

For its part, a country joining the WTO receives the same rights as all other WTO members.

Under the standard procedure, the results of all talks for liberalizing access to markets and specific WTO accession terms are formalized by official documents that include a report of the working party listing the package of rights and obligations due to be assumed by the prospective member country after the talks; lists of commitments regarding services and tariff concessions on goods; an accession protocol formalizing the agreements reached at bilateral and multilateral levels.

One of the main WTO accession terms calls for bringing national legislation and the practical regulation of foreign-trade operations in conformity with the provisions of the package of agreements of the Uruguay round.

At the final stage of the WTO accession process, the national legislature of a prospective member country ratifies the entire package of documents that have been duly coordinated by the working party and approved by the WTO General Council. These obligations then become part of the package of WTO legal documents and national legislation, and the prospective member country receives the status of a WTO member.

The Ministerial Conference is the top decision-making body, which usually meets every two years. It brings together representatives of all members of the WTO.

In between its sessions, the WTO General Council that includes representatives of all WTO members exercises its functions. Moreover, the General Council resolves disputes and reviews trade policies. The Council for Trade in Goods, Council for Trade in Services and Council for Trade-Related Aspects of Intellectual Property Rights function under its supervision.

The Ministerial Conference establishes the Committee on Trade and Development, Committee on Balance of Payments Restrictions and the Committee on Budget, Finance and Administration. All WTO member countries are free to delegate their representatives to the organization’s councils and committees.

The Ministerial Conference appoints the WTO director general who, in turn, appoints officials of the WTO Secretariat. The WTO director general also sets forth their duties and employment terms in line with the provisions approved by the Ministerial Conference.

The WTO includes working parties and expert groups and specialized committees that establish and enforce competition regulations, monitor compliance with regional trade agreements, the investment climate in member countries, and admit new members.

WTO decisions are adopted by consensus. Various interpretations of agreements’ provisions on goods and services and exemptions from specific obligations are approved by 75 percent of the votes. Amendments not affecting the rights and obligations of the parties, as well as the admission of new members, require a two-thirds majority vote.

The WTO’s working languages are English, French and Spanish.

On September 1, 2013, Roberto Azevedo was appointed the WTO director general for a four-year term.

The organization has its headquarters in Geneva.


The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of this site. This site does not give financial, investment or medical advice.

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