Executive Summary – The World Trade Organization: Selected Challenges and Canada’s Priorities

(Disponible en français : Résumé – Organisation mondiale du commerce : Défis choisis et priorités du Canada)

The World Trade Organization (WTO) is currently facing challenges relating to its executive, legislative, monitoring and adjudicative functions. As a founding member of the WTO, Canada has a number of reform proposals that are designed to address these challenges and to help the organization retain its role in the rules-based multilateral trading system.

Challenges relating to the WTO’s executive function appear to be the result of its decision-making process, the limited mandates of some of its bodies and the restricted role of its Secretariat. Through the Ottawa Ministerial on WTO Reform (the Ottawa Group), the WTO, Canada and some other WTO members are working to strengthen the organization’s operation and functioning. In January 2019, they decided to begin consultations with other interested WTO members with the goal of developing proposals for reform. The initial focus will be the WTO’s bodies that deal with trade in services, technical barriers to trade, sanitary and phytosanitary measures, and rules of origin.

Second, the WTO has had limited success in fulfilling its legislative (or negotiating) function, with the Doha Round of multilateral negotiations having made no significant progress since being launched in 2001. This outcome may be the result of the strict application of the “single undertaking” principle and trade-related differences among WTO members that may reflect their development status. Canada supports a negotiating approach that would recognize that, while the development needs of certain countries justify transitional periods to implement their WTO commitments, the long-term objective is full implementation of all obligations by all members. Furthermore, Canada wants to begin discussions regarding future WTO negotiations about e-commerce and certain issues relating to state-owned enterprises.

Third, the WTO members’ national trade measures are probably not being monitored in an effective and timely manner, which could adversely affect the transparency of the multilateral trading system. In particular, it seems that the WTO’s periodic trade policy reviews do not result in improvements to its members’ national trade measures, and that these reviews are not sufficiently frequent to reflect current economic realities. Canada wants to enhance the review of – and clear communication about – WTO members’ national trade measures, and to address concerns about compliance with the obligation to notify the appropriate WTO body about these measures.

Finally, despite the initial success of the WTO’s Dispute Settlement Body, its Appellate Body is facing what some view as a crisis. Canada, which frequently accesses the WTO’s dispute-settlement system, believes that resolving the issue of appointments to the Appellate Body will require addressing WTO members’ concerns about how it functions.

If left unaddressed, challenges in these four areas could weaken the rules-based multilateral trading system. Canada and other like-minded WTO members are exploring aspects of – and approaches to – reform and future negotiations.

Read the full text of the Background Paper: The World Trade Organization: Selected Challenges and Canada’s Priorities

Authors: Bashar Abu Taleb and Offah Obale, Library of Parliament