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WTO Dispute Settlement Mechanism(4)
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ChapterIV
  FunctionofPanels:Art.11oftheDSU
  
  OUTLINE
  
  IIntroduction
  IIApplicationofArt.11asaGeneralStandardofReview
  IIIReviewin“neitherdenovonortotaldefence”
  IVAllegationagainstPanels’StandardofReview
  VExerciseofJudicialEconomy
  
  
  
  IIntroduction
  ThefunctionofpanelsisexpresslydefinedinArt.11oftheDSU,whichreadsasfollows:
  
  “ThefunctionofpanelsistoassisttheDSBindischargingitsresponsibilitiesunderthisUnderstandingandthecoveredagreements.Accordingly,apanelshouldmakeanobjectiveassessmentofthematterbeforeit,includinganobjectiveassessmentofthefactsofthecaseandtheapplicabilityofandconformitywiththerelevantcoveredagreements,andmakesuchotherfindingsaswillassisttheDSBinmakingtherecommendationsoringivingtherulingsprovidedforinthecoveredagreements.Panelsshouldconsultregularlywiththepartiestothedisputeandgivethemadequateopportunitytodevelopamutuallysatisfactorysolution.”
  
  ThisprovisionsuggeststhatthefunctionofpanelsistomakeanobjectiveassessmentsuchastoassisttheDSBinmakingtherecommendationsoringivingtherulingsprovidedforinthecoveredagreements.However,howdopanelsfulfilltheirfunctionsasprovidedinArt.11oftheDSU?Itistheissuethatwewilltouchoninthischapter.Inthischapter,theauthorexploresonthestandardofreviewissueundertheWTO,i.e.“anobjectiveassessment”;aswellasontheexercisedjudicialeconomyprincipledevelopedinpanel’sreview.
  Withregardtothestandardofreviewissue,theGATT/WTOdisputesettlementprocedureshaveincreasinglyconfrontedquestionsconcerningthedegreetowhichaninternationalbody,undertheGATT/WTO,should“secondguess”adecisionofanationalgovernmentagencyconcerningeconomicregulationsthatareallegedlyinconsistentwithaninternationalrule.Itseemsclearthattheinternationalagreementdoesn’tpermitanationalgovernment’sdeterminationalwaystoprevail,otherwisetheinternationalrulescouldbeeasilyevadedorrenderedineffective.Butshouldtheinternationalbodyapproachtheissuesinvolvedwithoutanydeferencetothenationalgovernment?IthasbeenarguedintheGATT/WTOproceedingsthatpanelsshouldrespectnationalgovernmentdeterminations,uptosomepoint.That“point”isthecrucialissuethathassometimesbeenlabelledthe“standardofreview”.1
  Ofcourse,thisissueisnotuniquetotheGATT/WTO.Naturally,thestandard-of-reviewissueisonethatmanylegalsystemsface.“Thestandard-of-reviewquestionisfacedatleastimplicitlywheneversovereignmembersofatreatyyieldinterpretiveanddisputesettlementpowerstointernationalpanelsandtribunals.Moreover,asnationaleconomiesbecomeincreasinglyinterdependent,andastheneedforinternationalcooperationandcoordinationaccordinglybecomesgreater,thestandard-of-reviewquestionwillbecomeincreasinglyimportant.”2And“itcanbeseenthatthestandard-of-reviewquestionisarecurringanddelicateone,andonethattosomeextentgoestothecoreofaninternationalprocedurethatmust(inarule-basedsystem)assessanationalgovernment’sactionsagainsttreatyorotherinternationalnorms”.3
  However,fortheimmediatepurpose,wewanttofocusbelowonthemoreparticularquestionoftheproperstandardofreviewforaWTOpanelwhenitundertakestoexamineanationalgovernment’sactionsorrulingsthatengagethequestionofconsistencywiththevariousWTOagreementsandaresubjecttotheDSUprocedures.
  
  IIApplicationofArt.11asaGeneralStandardofReview
  UndertheWTOjurisprudence,it’sdemonstratedthatArt.11oftheDSUhasbeenappliedasageneralstandardofreview.Art.11suggeststhatthefunctionofpanelsistomake“anobjectiveassessment”soastoassisttheDSBinmakingtherecommendationsoringivingtherulingsprovidedforinthecoveredagreements.
  Forexample,inUS-ShirtsandBlouses(DS33),thePanelrulesthat,“althoughtheDSUdoesnotcontainanyspecificreferencetostandardsofreview,weconsiderthatArticle11oftheDSUwhichdescribestheparametersofthefunctionofpanels,isrelevanthere”.4
  AndtheapplicationofArt.11asageneralstandardofreviewundertheDSUisanalyzedsystematicallyinEC-Hormones(DS26/DS48)wheretheAppellateBodyrulesthat:5
  “Thefirstpointthatmustbemadeinthisconnection,isthattheSPSAgreementitselfissilentonthematterofanappropriatestandardofreviewforpanelsdecidinguponSPSmeasuresofaMember.NorarethereprovisionsintheDSUoranyofthecoveredagreements(otherthantheAnti-DumpingAgreement)prescribingaparticularstandardofreview.OnlyArticle17.6(i)oftheAnti-DumpingAgreementhaslanguageonthestandardofreviewtobeemployedbypanelsengagedinthe‘assessmentofthefactsofthematter’.WefindnoindicationintheSPSAgreementofanintentonthepartoftheMemberstoadoptorincorporateintothatAgreementthestandardsetoutinArticle17.6(i)oftheAnti-DumpingAgreement.Textually,Article17.6(i)isspecifictotheAnti-DumpingAgreement.
  […]
  Wedonotmean,however,tosuggestthatthereisatpresentnostandardofreviewapplicabletothedeterminationandassessmentofthefactsinproceedingsundertheSPSAgreementorunderothercoveredagreements.Inourview,Article11oftheDSUbearsdirectlyonthismatterand,ineffect,articulateswithgreatsuccinctnessbutwithsufficientclaritytheappropriatestandardofreviewforpanelsinrespectofboththeascertainmentoffactsandthelegalcharacterizationofsuchfactsundertherelevantagreements[…]”
  Insum,forallbutoneofthecoveredagreements,Art.11oftheDSUsetsforththeappropriatestandardofreviewforpanels.Asstatedonmorethanoneoccasion,Art.11oftheDSU,and,inparticular,itsrequirementthat“apanelshouldmakeanobjectiveassessmentofthematterbeforeit,includinganobjectiveassessmentofthefactsofthecaseandtheapplicabilityofandconformitywiththerelevantcoveredagreements”,setsforththeappropriatestandardofreviewforpanelsexaminingtheconsistencyorinconsistencyofallegedmeasuresundertheWTOjurisprudence.AndtheonlyexceptionistheAgreementonImplementationofArticleVIoftheGeneralAgreementonTariffsandTrade1994,inwhichaspecificprovision,Art.17.6,setsoutaspecialstandardofreviewfordisputesarisingunderthatAgreement(tobediscussedinsubsequentchapter).6
  
  IIIReviewin“neitherdenovonortotaldefence”
  InEC-Hormones(DS26/DS48),intheviewoftheEuropeanCommunities,“theprincipalalternativeapproachestotheproblemofformulatingthe‘properstandardofreview’sofaraspanelsareconcernedaretwo-fold.Thefirstisdesignatedas‘denovo

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