The World Trade Organization, WTO for short, has played an integral role in the relationship between trading nations since it was established in 1995. The WTO was set up to serve several purposes. The main reason for the foundation of this organization was to have a governing body to handle disputes concerning trade between nations. This was a novel idea. Basically, the theory was that by settling the disputes in an orderly and consistent fashion, the WTO could could decrease escalating tensions between trading nations and help to promote international trading at the same time. So, exactly how does the WTO manage to settle the multiple disputes that are brought before it every year?
In order to settle any dispute there has to be a consistent standard to judge what is right and what is wrong. In a court room, attorneys use evidence and quote the laws of their countries to defend or prosecute. The WTO does just that. It helps to settle disputes by enforcing a specific and consistent set of rules for all nations that are affiliated with them. This specific set of rules helps to instill confidence in the trading nations by ensuring that no matter what country one is buying or selling from the same rules apply. The WTO’s standard rules give a universal language to every affiliated nation. So, though one country may speak Japanese and the other English, they all speak the same language when it comes to the rules and regulations associated with trading practices.
The WTO helps to reduce tension and ensures fairness in trading practices for all nations associated with it. One reason all associated nations are so willing to conform to the standard agreement is because all associated nations had a hand in creating the rules they themselves must follow. Therefore, once a verdict is read associated parties will normally focus on the actions that must be taken to ensure that the dispute is resolved instead of taking matters into their own hands and creating or escalating violence.
This system differs slightly from the traditional legal systems of America and other counties where legal matters are drawn out and are therefore very costly. In an effort to keep costs lower and help keep international trading economical timelines are placed on every different type of case. Also, since most businesses are interested in finding solutions to their disputes and thus becoming more profitable in a quick amount of time, many of the disputes are settled without even having to be reviewed by a panel or council. In fact, this system is so efficient that the majority of cases are solved in a timely manner via consultations.
The World Trade Organization is an invaluable resource for the nations that are affiliated. This organization offers its members the confidence to trade knowing that they are protected by a standard set of rules that are made by all of the nations and applied to all the nations in a consistent, fair and efficient fashion. The WTO settles disputes just as a court of law should, by applying a standard set of rules to every situation and judging based on the evidence presented. Unlike the standard court of law, the WTO is efficient and is focused not on judging who is right or wrong necessarily, but by identifying a problem and giving reasonable steps to reach a resolution.