The WTO and Judicial Abstention

Last week the WTO Appellate Body issued its ruling in the Mexico sweetener dispute with the United States. I had reported earlier about the panel decision here. One of the more interesting issues in the case is the argument for judicial abstention. Mexico argued that the WTO had jurisdiction over the case but that it should exercise its discretion to the decline jurisdiction so the parties could resolve their dispute before a NAFTA Chapter 20 arbitral panel.



The Appellate Body agreed with Mexico’s argument that as an international tribunal it had certain powers inherent in their adjudicative function. That includes the right to determine if they have jurisdiction, as well as broad discretion to “deal, always in accordance with due process, with specific situations that may arise in a particular case and that are not explicitly regulated.” (para. 44). But it declined to accept the notion that such inherent authority extended to embrace the doctrine of judicial abstention.

“In our view, it does not necessarily follow, however, from the existence of these inherent adjudicative powers that, once jurisdiction has been validly established, WTO panels would have the authority to decline to rule on the entirety of the claims that are before them in a dispute. To the contrary, we note that, while recognizing WTO panels’ inherent powers, the Appellate Body has previously emphasized that “[a]lthough panels enjoy some discretion in establishing their own working procedures, this discretion does not extend to modifying the substantive provisions of the DSU. … Nothing in the DSU gives a panel the authority either to disregard or to modify … explicit provisions of the DSU.” (para. 46)

It then analyzed key provisions of the DSU requiring WTO panels to exercise jurisdiction. Following this analysis it upheld “the Panel’s conclusion … that ‘under the DSU, it ha[d] no discretion to decline to exercise its jurisdiction in the case that ha[d] been brought before it.’ Having upheld this conclusion, we find it unnecessary to rule in the circumstances of this appeal on the propriety of exercising such discretion.” (para. 57).



This seems correct. The question of judicial abstention in the context of international tribunals cannot be addressed in the abstract. The jurisdiction and authority of each international tribunal will depend upon the constituting documents establishing that tribunal. An analysis of the DSU makes it imminently clear that WTO panels do not have the authority to decline to exercise jurisdiction. As the Appellate Body details, there are numerous references in the DSU that advert to the obligation of WTO panels to resolve cases presented to them and that guarantee WTO members the right to present claims for resolution. A WTO panel (1) has a duty to examine claims presented to it (Art. 7); (2) “shall address” provisions in the WTO agreements cited by the parties (Art. 7.2); and (3) “should make an objective assessment” of the matter presented to it (Art. 11). Moreover, WTO members (1) “shall have recourse” to the DSU to seek the redress of WTO violations (Art. 23); and (2) may initiate a WTO dispute whenever it considers any rights impaired (Art. 3.3).



There may be a basis for another international tribunal to invoke the doctrine of judicial abstention. But it appears correct that in the WTO context that authority is lacking.