On the boundary clash between EC commercial law and WTO law

Abstract:

Both the WTO and the EC have come to a crossroads in their development. The WTO is currently the subject of the Doha round of negotiations, while the EC, together with pillars II and III of the EU, is about to be re-constituted under the draft European Constitution. The issue of the articulation between these two legal systems, despite the best efforts of legal academics over the years, remains unresolved, as evidenced in the recent case of Biret International SA v. Council.

Issues which were resolved in the early years of the EC on the nexus of the relationship between the EC and the laws of its member states, are now reappearing at the EC-WTO nexus. The EC-Member State principles of supremacy, direct effect and state liability for the non-implementation of directives are now being echoed at the WTO-EC nexus, in the context of direct effect, legality control, and indirect effect. The Biret case raised the issue of 'no-fault liability for the Community' for non-compliance with WTO law, echoing discourses many years earlier at the EC-MS nexus.

The issue of the boundary demarcations between EC Commercial law and WTO law merits re-examination in light of these developments, with the continuing imperfect legal articulation between these two jurisdictions resulting in a boundary dash which requires a resolution. Ideally this resolution would come in the form of a treaty amendment drafted by the member states of the EU. In this respect the draft Constitution, which fails to adequately address this issue, could be seen as a missed opportunity. The ECJ may well find itself obliged to develop the resolution based upon the Advocate General's opinion in the Biret case.