The World Trade Organization held its 13th Ministerial Conference (MC13) in Abu Dhabi (UAE) from 26 February to 2 March 2024. Ministers representing WTO Members of very different levels of development, and with very different (geo-)political views, met to discuss a plethora of important topics, ranging from food security and e‑commerce to fisheries subsidies and reform of the WTO, as well as domestic regulations of services and investment facilitation.
At MC13, ministers delivered agreements on several commercially important topics and endorsed a forward-looking reform agenda for the WTO. They also welcomed progress made in negotiations and provided guidance on issues where more work needs to be done. MC13 shows the value of an organization that facilitates exchange between diverse Members and delivers results.
On the first day of MC13, ministers endorsed the accession to the WTO of two least-developed countries—Comoros and Timor-Leste. This brings the organization’s Membership to 166, representing 98 percent of world trade. The accession of these new Members illustrates the continued attractiveness of the organization, including for least-developed countries.
At MC13, ministers endorsed progress on the WTO reform process, which covers the organization’s deliberative, negotiating and dispute settlement functions.
In June 2022, at their 12th Ministerial Conference (MC12), ministers recognized the urgency of addressing challenges and concerns regarding the WTO’s dispute settlement system. They directed officials to restore a fully and well-functioning dispute settlement system accessible to all Members by 2024.
At MC13, ministers reviewed the valuable contributions made, and welcomed the progress already achieved towards fulfilling that commitment. This includes a 36-page draft, setting out reforms to the WTO’s dispute settlement system. That draft results from an informal, facilitator-led process by Geneva-based officials. A Ministerial Decision instructs these officials to accelerate their discussions in an inclusive and transparent manner, and to build on the progress already made. Ministers also renewed their commitment to continue work on unresolved issues, including an appeal/review mechanism, and to achieve the objective of having a fully and well-functioning dispute settlement system accessible to all Members by 2024.
At MC12, ministers also agreed to conduct a comprehensive review of the functioning of the WTO’s deliberative and negotiating functions. At MC13, ministers welcomed the work already undertaken to (1) improve the functioning of WTO Councils, Committees and Negotiating Groups, (2) enhance the organization’s efficiency and effectiveness, and (3) facilitate Members’ participation in WTO work. They instructed officials to continue their “reform by doing” process and to report progress to the 14th Ministerial Conference (MC14).
Since 1998, Members have regularly extended a so-called e‑commerce moratorium, which commits Members not to impose customs duties on e‑commerce. At MC13, ministers decided to renew the e‑commerce moratorium until MC14 or 31 March 2026, whichever is earlier. The Ministerial Decision also instructs officials to re-invigorate their work programme on electronic commerce with a particular focus on its development dimension.
Given the extent of e-commerce trade, the decision to continue the moratorium on the imposition of customs duties is of critical importance for many businesses worldwide, both large and small.
In a decision that has often been linked to the e‑commerce moratorium, ministers decided to extend also a moratorium on so-called “non-violation” and “situation” complaints under the TRIPS Agreement. Such complaints would otherwise allow Members to challenge, in WTO dispute settlement, IP-related measures that are not inconsistent with TRIPS obligations but that nonetheless undermine benefits expected from the agreement.
At MC12, ministers adopted special rules that broadened the availability of compulsory licenses for the production of Covid‑19 vaccines. They also mandated negotiations on whether to expand the product coverage of these special rules to Covid-19 diagnostics and therapeutics. At MC13, ministers took note of the work undertaken and the lack of a consensus on expanding the product scope. Accordingly, these special rules are not going to apply to compulsory licenses for the production of Covid‑19 diagnostics and therapeutics. Ministers, however, encouraged continued work on lessons learned from the Covid‑19 pandemic, and on developing effective solutions for future pandemics.
Ministers adopted a decision to improve the use of special and differential treatment (S&DT) provisions, in particular those in the Agreement on Technical Barriers to Trade and the Agreement on Sanitary and Phytosanitary Measures. The decision enhances training opportunities and endorses steps to make the S&DT provisions more effective and operational.
In light of the diverse Membership of the WTO, reaching consensus in multilateral negotiations among all Members is challenging. Indeed, at MC13, Members failed to reach consensus on agriculture and food security as well as further disciplines fisheries subsidies (see below). Plurilateral initiatives (covering less than the full Membership) are, therefore, becoming more prominent. At MC13, several such plurilateral initiates reached agreements or reported on the results of their work in important areas. These outcomes further show that, in a variety of settings, significant and commercially meaningful results continue to be possible at the WTO.
One commercially particularly relevant outcome is the agreement reached at MC13 on the entry into force, and integration into the WTO architecture, of new disciplines on domestic regulation of services. These disciplines are designed to facilitate trade in services by streamlining and simplifying regulatory procedures. Commitments relate to, for example, licensing, qualification and technical standards and seek to make the regulatory environment more conducive to business. The agreement was negotiated under a so-called Joint Statement Initiative (JSI) by 72 Members that account for more than 92 percent of world services trade. It is anticipated to reduce the costs of global services trade by over US$125 billion annually.
Another important plurilateral initiative concerns Investment Facilitation for Development (IFD). At MC13, the parties to the IFD initiative welcomed an agreement that includes commitments to facilitate foreign direct investment. The agreement results from a JSI initially launched by a coalition of developing and least-developed Members. These Members recognized the importance of transparency and other investment facilitation measures to advance their sustainable development objectives. As of MC13, the IFD Agreement has more than 120 parties, including many developing and least-developed Members, alongside most developed Members.
Members have also come together in different groupings to work on a series of sustainability-related initiatives. At MC13, they reported their progress. For example, (1) the Dialogue on Plastics Pollution and Environmentally Sustainable Plastics Trade, an initiative comprising 78 Members, identified trade and trade-related measures and policies to reduce plastics pollution. The 76 co-sponsors of the (2) Trade and Environmental Sustainability Structured Discussions (TESSD) reported on their work and progress in four areas: (a) trade-related climate measures, (b) environmental goods and services, (c) the circular economy and (d) the design and transparency of environmental subsidies. Finally, 48 Members reported on progress towards (3) Fossil Fuel Subsidy Reform.
Each of these initiatives provides important opportunities for Members to engage with one another and to share best practices and develop solutions that contribute to addressing environmental concerns. Such continuous engagement also facilitates avoiding trade conflicts.
In June 2022, at MC12, Members concluded an Agreement on Fisheries Subsidies (AFS). The AFS prohibits the granting or maintaining of subsidies to entities involved in (1) illegal, unreported and unregulated (IUU) fishing or (2) the fishing of overfished stocks. It is the first WTO agreement with a mostly sustainability-related objective (preserving the world’s fisheries stocks).
At MC13, ministers welcomed the progress over the past 20 months towards the AFS’s entry into force. As of 1 March 2024, 71 Members have ratified the agreement. A further 39 ratifications are needed to reach the threshold of 110 for the agreement’s entry into force.
However, ministers failed to bridge a small number of gaps in negotiating additional disciplines on subsidies contributing to overcapacity and overfishing—an area where consensus had been elusive already at MC12. These disciplines balance (1) prohibitions on subsidies with (2) exceptions where proper fisheries management measures are in place and (3) provisions on S&DT. The remaining disagreements concern, in particular, the lengths of transitional periods available for developing countries and provisions on forced labor. Work on these will continue post-MC13.
Although updating WTO disciplines on agriculture has been on the agenda of Members since 2000, little progress had been made. Prior to MC13, there appeared to be a more positive dynamic. Yet, ministers failed again to reach consensus on the scope, balance and timeline of agriculture negotiations. This failure resulted, in particular, from broad disagreement over the so-called (but mis-labeled) issue of “public stockholding for food security purposes”. That disagreement also prevented consensus on enhanced disciplines on agricultural export restrictions that may threaten to undermine food security in net-food importing countries.
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