Decision Making Processes at the WTO and the EU: a Comparative Analysis

ABSTRACT

The paper gives a broader comparative analysis of the decision making processes at the WTO and the EU. It should be noted that the decision that is made at both the EU and WTO shall be binding to all the members hence the need for the approval. As a result any member that is dissatisfied by any decisions and rules that are set shall be invited for further negotiations in order to reach a compromise. The paper appreciates the importance of decision making process because it helps to understand the various facets and tenets where critical decisions making processes is carried out. Decision making is an obligation that is vested on the various organs of both the EU and the WTO as it shall be discussed in the main paper. In that view, the paper shall focus on the various issues where decision making is required. For instance a critical area such as dispute resolution requires comprehensive measures in decision making. For instance the WTO has the Appellate Body which makes decisions. On the other hand the EU has very comprehensive dispute resolution mechanism which goes up the European Court of Justice for settlement of disputes. It gives a comparative analysis on the various levels of decision making.

Introduction

Decision making is an important process that involves key stakeholders. It seeks to highlight the various procedures and laws that will be followed in all the necessary undertakings of the particular organization or entity. These paper shall therefore give a comparative analysis the processes involved in decision-making European Union and the WTO. It highlights the similarities on the different levels and organs of decision-making and other differences[1]. The paper shall show how the different literatures that have discussed this particular topic and majorly raised concerns with the use of consensus as a way of decision making.

Origin of Decision making Processes under the EU

Decision-making at the European Union aimed at ensuring that well informed ideas and rules are set on how the region could reclaim its peace that existed before the Second World War. The decisions were to be made to favor their economic integration which later on expanded to socio-political scopes. The growth of the EU is attributed to the informed decisions that have been made on various issues that have resulted to the tremendous expansion of areas of integration. The importance of decision-making in the Europe informed by the fact that the various initial member states demonstrated a difference in economic interests which was measured on the different policies in the respective countries. It was therefore necessary for the countries to come together under the umbrella of the EU and have harmonized policies that would regulate their economies. This situation therefore called for the countries to come together and make necessary decisions that could help them to have common objectives as a region[2].

Complexity of the Process under the EU

Process of decision-making under the EU engages different links whilst making it a bit complex because of the various stages that it undergoes. The many links are attributed to the fact that the European Union is a region comprising of 27 member states each with its own government. However they are all required to subject themselves to the common rules and regulations that are formed by the European Union[3].

Key institutions involved in decision under the EU

The European Council

The Council is considered as the extension of the council of ministers. It comprises of the head of government who attends the council meetings in company of their foreign affairs ministers and other dignitaries from the cabinet as it may be required. The meetings are held thrice in a year to deliberate and make decisions on various issues pertaining the operation of the European Union[4]. They discuss important issues that involve the Treaty that led to the formation of the European Union. It also makes decisions concerning resources that are used by the commission in its daily operations. A fundamental issue that has been brought before the Council for decision making has been beef exports in British. It should be noted that all the issues that involve changes of the Treaty formation and requires unanimous decision and subsequent ratification by the respective members States Parliament are handled at the intergovernmental conferences.

The council of ministers

The institution comprises of the respective ministers of different member states. For instance, matters involving trade in goods shall involve a minister concerned with matters involving trade in every member state. They decide on regulations on particular issues concerning the area of administration and such decisions shall be binding to all the member states. In the case where regulations have been made they shall give an express specification on how the commission shall be involved in the administration processes and the implementation of the decisions. In the case where the council of ministers makes directives on a specific issue concerning trade in goods, they shall direct that the specific member states must put in place specific measures that shall lead to implementation of such directives[5]. The decisions that are made by the council shall be binding to the respective governments of the member states. They can also give you directives that shall govern all the organizations, institutions and other enterprises that are based within the European Union. For its effectiveness the council of ministers has a Committee of Permanent Representatives of member states (COREPER). The main responsibility of (COREPER) is to ensure that the work of the council is well prepared and also can carry out any other duties and what’s that have been assigned to it by the Council. The kind of tasks that the council of ministers assigns (COREPER) are those issues which arise frequently and they need agent Solutions let the council has failed to agree on them[6].

The commission

It makes proposals to the council of ministers on particular matters that the council of ministers should handle. It ensures that all the provisions of the treaty on the formation of the European Union are respected and upheld by the respective member states. Members of the commission are called commissioners who are nominated by the governments of the respective members States. The European Council in consultation with the European Parliament makes a decision on who should head the commission[7]. The commissioners are appointed by the member states and then selected to the commission upon the approval of the bill in Parliament. Portfolios of such commissioners are allocated by the head of commission who will have been selected by the European Council upon consultation with the Parliament. The portfolios are those which deal with critical matters such as trade in goods and agriculture which are likely to rise conflict among member states. Once an individual has been fronted by his country to be a commissioner he is required under article 157(2) after treating to ensure that they represent all the interests of the European community and not their respective countries. The commission also makes decisions on the various proposals that shall be fronted to the European Council upon consultation of the European Parliament and other essential institutions such as the Social and Economic Committee. It is also vested with authority to identify the various issues that should be legislated and makes proposals thereof. It ensures that all the decisions that have been made are compiled with by the various member states.

The European Parliament

It comprises of members that are directly elected. It plays a major role of advising the council on the various fundamental issues that affect the region it also plays an important role in raising concerns and questions to the commissioners upon receipt of the annual reports from the head of the commission. It receives the proposals that have been prepared by the commission on the change of various laws. Upon receipt it reviews the particular proposals and makes the decision in consultation with the council of ministers the adaptability of the laws. It makes the fundamental decisions on the various issues that affect the people and therefore the proceedings are made public and published for any individual to retrieve and be informed of the kind of decisions that will have been made on particular laws. It is also vested with the authority to pass any motion of censure in a particular commission. Decisions at this institution concerning such matters are made by a vote of two-thirds majority is it is required under article 144 of the Treaty. Among the fundamental laws that have been passed by the parliament and affect the area of trading goods is Article 113 of the Treaty of Rome which listed the European community with the responsibility to negotiate common commercial policies which would expand the EU borders to open trade partnerships with other countries and regional blocs to enhance its global economy[8]. The article has since been revised and extended under article 228 by the Maastricht treaty which vested committees, the commission, and the council the necessary power that could help in the implementation of the policies. The move to empower the commission has released its status because it plays a fundamental role in considering any proposals from different members who apply to join multilateral trade agreements and all agreements with the European Union

Sub Committees

The European Union has various sub-committees that handle different specialized issues. One of the most important major committee is the economic committee which is appointed by the council upon recommendation members from the various member states. Its composition is enshrined under article 193 of the Treaty. It has various sub-committees that help in the running of its mandate. For instance the agricultural sector hold various interests that are catered for by various subcommittees. One of the most active sub-committees under the agricultural sector is the milk advisory committee which organizes and links farmers with the marketing organizations. It also says that the interests of farmers on matters dealing with milk production such as prices. All matters dealing with agriculture which forms the basis in trade of goods the commission also plays a fundamental role in making decision processes that relates to agriculture. It is a requirement that the commission makes a real proposals that should help you prices of different Farm products.

The European Court of Justice

Decisions of the European Court of Justice adversely impact on the policies that control various aspects of trade. The EU hears and determines on issues that pertain to trade the on appeals from the member states. it serves in the same rank as that of  the WTO which shall hear and determine issues raised by the adverse what is that are not satisfied by the decision of the lower bodies in which under the WTO is the panel

Comparison with the WTO

Advent of the World Trade Organization was a major boost in the Promotion of multilateral trade organization to replace the GATT that had been formed in 1947. Relation that pertain to international trade among various States has held up history where countries that are developed sought to advance their ideologies that will promote the economic without considering developing countries.  That was majorly witnessed in the GATT which was regarded as a ‘club’ for the developed countries which influenced all critical decision-making process. The third world countries did not have advantage of being involved in making critical decisions that could affect the economic sphere. Despite existence of the provision and principle of non-discrimination and reciprocity under the GATT, member states which were less developed still felt that the principal was not followed to the latter. Their involvement was regarded to be partial because of the difference in treatment of the member states. Ironically these decisions were binding to including those who did not involve in the making of the side decisions[9].

Unlike GATT, the WTO is established under article 1 and VIII as an international organization which exist will the legal personality.  WTO was vested with authority of making guidelines that will regulate trade activities the world. Its decisions are binding to all the countries that subscribe to it. It is important for member states to understand the various processes involved in decision-making various issues. It should be noted that the processes that are involved in decision-making general agreement on tariffs and trade (GATT) are seemingly different from those that are adopted under the WTO. Most decisions which were made under the GATT system worked effectively because of the circumstances to that effect. Many critics have raised concerns over the influence of certain regional blocs and countries[10]. They also base their concern on the fact that the membership of the WTO has expanded immensely from that of the previous GATT. The expansion of the membership therefore means that more comprehensive decision-making processes just the use of consensus where the voice of a few countries may not be adequately heard. The other change in decision-making is noted during negotiation of trade agreements especially after the commencement of the Uruguay Round Records. Unlike before, where the member countries enjoyed all already negotiated trade agreements currently every member is required to participate in any negotiated agreement by itself so as not to escape and obligations. That has been an important step especially for third world countries which must now have their keen representatives that will represent their interests in particular trade agreements. The idea is equivalent to that of the European commission which plays a fundamental role in negotiating any trade agreement that the European Union.  When a member applies to the European Union to join in a preferential trade agreement, it shall send its representatives to spearhead their interests in the preferential trade agreement negotiation. The European Union shall be represented by the commission which also serves under the instructions of the European Council which it also reports to. It therefore needs every country to be knowledgeable of the various trade issues that shall be raised in the trade agreement.

With the rising number and complexity procedures in the decision-making process is worth to note the system that previously worked under the GATT remains an effective during that time and can only apply now with the relevant modifications. At that time consensus only required participation of a few countries which could easily reach a joint decision. The increase in areas of trade has raised concerns of complexities among member states hence the need to change the decision-making processes under the WTO. A good example of the issue that race complexities in trade is the one involving intellectual property rights.

Decision-making process under WTO is provided for under article IX and X the agreement and other related annexures which include those of dispute settlement understanding. The diversity of issues that arise within international trade makes it possible for the WTO to have various mechanisms that will facilitate decision-making that would enhance definition of the WTO.

The fundamental principal which also forms the Foundation of the decision-making process what are the WTO is the principle of one vote for every member state. In the case where a regional bloc such as the European Union represent its member states in decision-making it shall vote on the capacity equivalent to the number of member states which is currently 27. The other form of decision-making which has been at the WTO is that of virtual duopoly which majorly applies during the Ministerial Conference and the meeting of the general council.

Comparison of the Bodies in Decision Making

It is the Apex decision making body of the WTO. It receives reports from the General Council over the decisions that have been made for the day-to-day operation the WTO. There are various important bodies that work under the supervision of the general council to carry out specific duties pertaining to certain areas within the scope of the WTO[11]. For instance, a permanent body like the council for trading goods services and TRIPS make certain decisions for their day-to-day operations of the WTO. It carries its duties under `the supervision of the General Council[12].

Decision-Making on Dispute Relating To Trade

Under the European Union, the commission is required to enter into agreement with the member that seeks a for a preferential trade agreement on the specific mechanism of dispute resolution that shall be adopted in case any arises[13]. The parties may have a dispute resolution mechanism clause in the agreement which shall be binding upon the enforcement of the trade agreement. The parties may also choose to adopt the dispute resolution mechanisms stipulated under the WTO. In the case of the latter the parties shall be bound to submit to all the procedures of its decision-making on matters. That means that the rules under the dispute settlement understanding shall apply to all the members without any form of discrimination. Such disputes shall be handled by the dispute settlement body which shall formulate a panel that shall hear and determine on the matter at hand. The decision of the panel may not be final because it can be taken to the appellate body. The appellate body makes decisions which are then submitted to the General Council to oversee implementation. A country which has been put under obligations to fulfill certain things shall be bound by the decision of the appellate body and any Breach may attract remedies such as sanctions[14].

Decision by Consensus

Just like it is under the European Council, article IX:I of the WTO agreement stipulates that the use of consensus as it was in the GATT 1947, shall remain in force except as otherwise provided. It also expressly provides that in the case where decisions cannot be made through a consensus that particular issue should be handled and decided by way of voting. It is important to note that decisions under the Ministerial Conference and the General Council are made by a majority of the votes cast on the principle of one member one vote. That therefore implies that the WTO agreement stipulates for two ways of decision-making which first babies of majority. The use of simple majority but it gets any instances where the country’s failed to reach an amicable decision which is agreeable to all in such a case the decision of the majority of the members shall carry the day and they shall remain binding to all the other member states. The fact that the agreement does not differentiate which kind of decisions shall be made on which kind of criterion it remains the discretion of the two bodies to decide on which decision shall be made by either majority vote or consensus[15].

CONCLUSION

Both the WTO and the EU have comprehensive mechanisms structures, and organs through which fundamental decisions are made. Comparatively both the EU and the WTO have Apex bodies through which final decisions are made. Decisions at the WTO are majorly made through committees and submitted to the General Council which makes final decisions that are reported to the ministerial conference[16]. Similarly the Apex body at the EU is the Council which instructs the commission on the various issues on which specific decisions shall be made. In practice most of the decisions under the WTO decision-making body are made through the use of consensus. A consensus shall be said to be registered if no member state raises formal objection to the conclusions and decisions that have been reached by other members. Unlike a unanimous decision, a decision which has been reached by consensus is that why she has not received any formal objection by a member state[17].