A German buying a banana in Berlin; a New Yorker grabbing their first coffee of the day; a Muscovite enjoying a glass of Merlot in the evening – what do these three people have in common? They are all consuming commodities brought to their locations through international trade and the laws that govern it.

The World Trade Organization (WTO) is at the helm of international trade law, existing as the only international entity overseeing the rules of trade between nations. Central to its functioning are the WTO agreements. These are negotiated and signed by the majority of nations around the world, and then ratified by the respective domestic governments. As a regulatory body, the WTO aims to lower international trade barriers in the hope that the playing field is conducive for the business of exporters, importers, and producers of goods and services.

International trade laws set by the WTO dictate best practice for countries when conducting trade. These international regulations ensure the fair exchange of commodities, such as those mentioned above, between nations. In establishing rules and customs across the board, the organisation aims to facilitate and foster trade, not restrict it. This is why, for instance, if you live in Rome you can choose to buy a car that was made in Germany, Japan, or the US. Automobile trade across nations and continents is just one example of a commodity gaining mileage thanks to the lifting of international trade barriers. Other goods that have benefited greatly include crude oil, coffee, agricultural produce, animals and animal products, sugar, metals and precious metals, plastic, natural gas and bio fuels.

International trade law should not be considered the same as international economic law, which is a much wider field. Confusion between the two can occur because international economic law, while it includes global regulations for international trade, also legislates for the international monetary system and currency regulation, as well as international development law. These factors do not fall under the remit of international trade law.

The Importance of the WTO for International Trade Law

The World Trade Organization is based in Geneva, Switzerland, and was formed on 1st January 1995. At the end of 2015, its membership numbered 162 countries – a large portion of the approx. 195 countries currently in existence. In total it employs some 600 people, all experts in law, economics, statistics and communications, who help the organisation to conduct positive negotiations with its members and ensure the uniform compliance of international trade as set by the WTO.

One of the most important objectives of the WTO for global trade is to incorporate new members. More importantly, however, is the role it plays in providing technical assistance and training for these countries as they prepare to join existing trade agreements, begin trading with current WTO members, and therefore abide by the established international trade regulations. In doing this, the organisation ensures that international trade law is not just adhered to, but that it is propagated beyond the present boundaries of the WTO, expanding the playing field in a fair and sustainable way for all.

Aside from handling negotiations and spreading international trade and its laws, the organisation also provides an independent trade dispute settlement system. This system is called into action whenever a WTO member disobeys international trade restrictions or fails to comply with the rules. Since the inception of the dispute settlement body in 1995, there have been 369 dispute cases with nearly a quarter of these coming to an amicable conclusion. The WTO dispute settlement body has sole jurisdiction over disputes within the context of international trade law.

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