ABSTRACT
T h e r e a r e many s t o r i e s a b o u t t h e o f t e n c r y p t i c w o r d i n g and i n h e r e n t c o m p l e x i t y o f G A T T law and G A T T p r a c t i c e . C o n g r e s s m e n in t h e U n i t e d S t a t e s h a v e g r o a n e d that ' a n y o n e who r e a d s t h e G A T T is likely to h a v e his sanity i m p a i r e d ' . 3T h e
56 E R N S T - U L R I C H P E T E R S M A N N
p r e s u m a b l y s m a l l n u m b e r o f p e o p l e w h o h a v e e v e r s u c c e e d e d in r e a d i n g t h e full t e x t o f the G e n e r a l A g r e e m e n t - many p r o v i s i o n s o f w h i c h h a v e b e e n d r a f t e d ' w i t h A n g l o - S a x o n d i s c u r s i v e n e s s ' 4( s u c h a s t h e 23 p a r a g r a p h s o f A r t i c l e X V I I I e x t e n d i n g o v e r e i g h t n a r r o w - t y p e d p a g e s p l u s at w o - p a g e A n n e x ) - may h a v e s h a r e d the c o n c l u s i o n o f o n e e x p e r t t h a t ' o n l y the l e a r n e d c a n c o m m u n i c a t e w i t h it a n d then o n l y in c o d e ' . 5A f t e r t h e r e a d i n g , t h e y m a y h a v e b e e n t o l d by aG A T T p r a c t i t i o n e r t h a t ' t h i s legals i t u a t i o n ...b e a r s no r e l a t i o n to t h e f a c t s ' 6and ' [ b r e a c h e s o f rules] h a v e in s o m e c a s e s b e c o m e so f r e q u e n t and so t o l e r a t e d t h a t the r u l e s a r e n o w s i m p l y t r a p s f o r t h e u n w a r y , i n e x p e r t o r n a i v e ' . 7
E v e n e c o n o m k s p e c i a l i s t s o n t h e G A T T h a v e c o m p l a i n e d t h a t ' o n l y t e n p e o p l e in the w o r l d u n d e r s t a n d it a n d they a r e n o t t e l l i n g a n y b o d y ' . 8T h e few l e g a l e x p e r t s t h a t h a v e e l a b o r a t e d s y s t e m a t i c t r e a t i s e s o n t h e G A T T h a v e d e s c r i b e d it a s a' p u z z l e ' 9a n d h a v e b e e n c r i t i c a l o f t h e a p p a r e n t c o n t r a d i c t i o n b e t w e e n t h e l e g a l i s t i c s t y l e o f t h e G e n e r a l A g r e e m e n t , d r a f t e d f o r t h e m o s t p a r t i n p r e c i s e a n d j u s t i c i a b l e l a n g u a g e r e s e m b l i n g atax c o d e , a n d the G A T T ' s s o m e t i m e s o v e r l y p r a g m a t i c ' d i p l o m a t ' s j u r i s p r u d e n c e ' 10 a n d ' i n s t i t u t i o n a l i n a b i l i t y to m a i n t a i n c o m p l i a n c e w i t h the r u l e s ' . 11 T h o s e e n g a g e d in c o m m e r c i a l d i p l o m a c y o f t e n p e r c e i v e it as ' a n e n d u r i n g i r o n y t h a t w h i l e g o v e r n m e n t s h a v e d e a l t w i t h i n t e r n a - t i o n a l t r a d e i s s u e s t h r o u g h t h e G A T T f o r m o r e t h a n t h i r t y y e a r s , b u s i n e s s e s a c t u a l l y e n c o u n t e r i n g t r a d e p r o b l e m s in t h e m a r k e t - p l a c e t h i n k o f t h e G A T T , to the e x t e n t t h a t t h e y t h i n k o f i t a t a l l , as s o m e t h i n g r e m o t e a n d i n e f f e c t u a l . L i k e a p a r t m e n t d w e l l e r s l i v i n g on d i f f e r e n t f l o o r s , the G A T T a n d t h e b u s i n e s s c o m - m u n i t y h a v e c o - e x i s t e d a l l t h i s t i m e , b u t l a r g e l y in i s o l a t i o n f r o m o n e a n o t h e r . ' 12 T h e introductory quotation from arecent G A T T dispute-settlement r e p o r t illus-
trates what areading o f the central G A T T dispute-settlement p r o v i s i o n o f Article XXIII c o n f i r m s beyond doubt: the G A T T dispute-settlement provisions a r e no exception to the general difficulty o f understanding G A T T law. D u r i n g the preparatory w o r k o n the G A T T in G e n e v a b a c k in 1947, o n e delegate c h a r a c t e r i z e d ad r a f t o f Article XXIII by saying that, ' o f all the vague and woolly punitive p r o v i s i o n s t h a t one could make, this seems to hold the p r i z e place. I t a p p e a r s to me that what it says is this. I n this wide world o f sin t h e r e a r e c e r t a i n sins which we have n o t yet d i s c o v e r e d and which, a f t e r long examination, we c a n n o t define; but there being such sins, we will provide s o m e sort o f punishment for them i f we flnd out what they a r e and i f w e find anybody committing them. T h e only definite thing in the whole Article ...is the t y p e o f punishment which can be visited upon these o f f e n d e r s . I t seems to me that this is something like P i r a n d e l l o ' s play Six Characters in Search o f an Author, only it is ratherthe o t h e r way round. H e r e it is o n e punishment in search o f six s i n s . ' 13 I n comparison with the dispute-settlement provisions o f o t h e r international economic organizations, A r t i c l e XXIII appears indeed t o b e unique in admitting complaints not only in the c a s e o f aviolation o f specific G A T T obligations b u t also w h e n certain government m e a s u r e s , entirely legal in themselves, ' n u l l i f y o r impair any benefit accruing u n d e r this A g r e e m e n t ' . 14
G A T T D I S P U T E - S E T T L E M E N T P R O C E D U R E S 57
T h e m a i n e c o n o m i c f u n c t i o n o f i n t e r n a t i o n a l a g r e e m e n t s on t h e use o f t r a n s p a r - e n t , n o n - d i s c r i m i n a t o r y a n d l e a s t - d i s t o r t i v e p o l i c y i n s t r u m e n t s , such as the G A T T and the I M P A r t i c l e s o f A g r e e m e n t , is to a s s i s t e a c h c o n t r a c t i n g p a r t y ( m e m b e r c o u n t r y ) in i n c r e a s i n g its n a t i o n a l g a i n s f r o m t r a d e by m e a n s o f g e n e r a l r u l e s d e s i g n e d to r e d u c e i n t e r n a t i o n a l t r a n s a c t i o n c o s t s , to s e c u r e m a r k e t a c c e s s and to e n h a n c e u n d i s t o r t e d c o m p e t i t i o n . Am a j o r f u n c t i o n o f d i s p u t e - s e t t l e m e n t p r o - c e d u r e s is to i n c r e a s e legal c e r t a i n t y a n d , t h e r e b y , to act as a n i n c e n t i v e f o r s h i f t i n g r e s o u r c e s from p r o t e c t i v e i n t o p r o d u c t i v e u s e s . T h e s e e c o n o m i c o b j e c t i v e s c a n b e a c h i e v e d o n l y to t h e e x t e n t t h a t t h e i n t e r n a t i o n a l r u l e s a r e k n o w n , u n d e r s t o o d a n d r e s p e c t e d n o t only b y g o v e r n m e n t s b u t a l s o b y p r i v a t e t r a d e r s , p r o d u c e r s , i n v e s t o r s and c o n s u m e r s a n d to t h e e x t e n t t h a t they a r e c o n s i s t e n t l y c o n s t r u e d and a p p l i e d o v e r t i m e . I f g o v e r n m e n t s a n d t h o s e e n g a g e d in i n t e r n a t i o n a l t r a d e d o not r e m a i n c o n v i n c e d t h a t o b s e r v a n c e o f t h e r u l e s p r o m o t e s t h e i r national a n d individual s e l f - i n t e r e s t s , t h e r u l e s may c e a s e to be r e s p e c t e d . And i f the r u l e s a r e not s e t in af r a m e w o r k o f an e f f e c t i v e ' l e g a l s y s t e m ' o f m u t u a l ' c h e c k s and b a l a n c e s ' , e n s u r i n g t h a t t h e p u b l i c g o o d o f legalc e r t a i n t y a n d u n d i s t o r t e d i n t e r n a - tional c o m p e t i t i o n is n o t u n d u l y s a c r i f i c e d t o s h o r t - t e r m e x i g e n c i e s and s p e c i a l i n t e r e s t s , the r u l e s may p r o v e i n c a p a b l e o f p l a y i n g t h e i r c r u c i a l r o l e . I n t e r n a t i o n a l legal d i s c i p l i n e s d e s i g n e d t o c o n s t r a i n the a b u s e o f d i s c r e t i o n a r y p o w e r s in t r a d e and m o n e t a r y p o l i c y c a n n o t r e m a i n e f f e c t i v e i f t h e i r i n t e r p r e t a t i o n a n d o b s e r v a n c e a r e c o n s i d e r e d t o lie w i t h i n t h e d i s c r e t i o n o f the g o v e r n m e n t s w h o s e p o w e r s the r u l e s w e r e d e s i g n e d to c o n s t r a i n . G e n e r a l r u l e s p r o m o t i n g legalc e r t a i n t y a n d u n d i s t o r t e d c o m p e t i t i o n , c o n s i s - tently c o n s t r u e d and a p p l i e d o v e r t i m e , h a v e b e e n l i k e n e d b y e c o n o m i s t s to as t o c k o f c a p i t a l c o n t i n u o u s l y y i e l d i n g p r o f i t s . L i k e G r e s h a m ' s L a w o n t h e r e p l a c e m e n t o f g o o d money by t h e b a d , i n c o n s i s t e n t i n t e r p r e t a t i o n s a n d v i o l a t i o n s o f the r u l e s may e n t a i l av i c i o u s c i r c l e o f ' b a d l a w s d r i v i n g o u t g o o d l a w s ' . I f g o v e r n m e n t s no l o n g e r o b s e r v e the l e g a l d i s c i p l i n e s t h a t m a k e m u t u a l e c o n o m i c gains p o s s i b l e , o t h e r g o v e r n m e n t s may b e t e m p t e d o r p r e s s u r i z e d t o f o l l o w s u c h p r e c e d e n t s ; a n d even p r i v a t e e c o n o m i c a g e n t s may w o n d e r why they s h o u l d c o n t i n u e t o o b s e r v e i n t e r n a t i o n a l t r a d e r u l e s .
