The crisis over appointments to the WTO's Appellate Body has been one of
the most challenging conflicts the GATT/WTO system has ever seen, threatening
to destroy a core institution of the world trading system. The Appellate Body
has played a valuable role in dispute settlement, by providing a coherent set
of jurisprudence to guide WTO Members as to the meaning of WTO law. The
Appellate Body does not create formal "precedent," but nevertheless
its reasoning in past cases serves informally to create expectations as to the
meaning of the WTO agreements. The United States has objected to the Appellate
Body's treatment of past rulings, arguing that the Appellate Body has elevated
these rulings to "binding precedent." However, a careful reading of
the language used by the Appellate Body to describe its views indicates that
the Appellate Body has not done so. The U.S. objections are one part of its
series of concerns justifying its blocking of appointments. Losing the
Appellate Body over this dispute would be devastating to the WTO, and engagement
on these issues must continue in good faith in order to find a resolution.
Journal of World Trade