[Congressional Record Volume 141, Number 65 (Friday, April 7, 1995)]
[Extensions of Remarks]
[Page E819]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


   A BILL TO ESTABLISH A COMMISSION TO REVIEW THE DISPUTE SETTLEMENT 
                REPORTS OF THE WORLD TRADE ORGANIZATION

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                           HON. AMO HOUGHTON

                              of new york

                    in the house of representatives

                        Thursday, April 6, 1995
  Mr. HOUGHTON. Mr. Speaker, I am joined today by my colleague, Mr. 
Levin, in introducing legislation which will create a process by which 
the Congress can act to ensure that the new World Trade Organization 
dispute settlement system is not abused by our trading partners to 
undermine U.S. interests.
  Late last year, in consecutive special sessions, both Houses of 
Congress passed legislation implementing the new GATT agreement. That 
agreement establishes a new international body to oversee trade 
disputes, the WTO, and gives it unprecedented authority to enforce the 
decisions of its dispute settlement panels.
  During the period leading up to the vote, many Americans voiced their 
concerns that this new international organization would undermine U.S. 
sovereignty and might harm rather than help U.S. interests in global 
trade. I spent a great deal of time and effort in developing the 
implementing legislation that ensures that U.S. industries and their 
workers would continue to have remedies available in U.S. law to 
protect against foreign unfair trade practices like dumping and 
subsidies. While it was not perfect, I supported the final version of 
the bill because I believed that on balance it served the interests of 
the United States. But this does not mean we can now ignore the 
legitimate concerns raised last year about the WTO and its new dispute 
settlement process. We must carefully scrutinize the actions of the WTO 
and its dispute settlement mechanism in order to ensure that our trade 
laws are not undermined through improper WTO decisions.
  Under the WTO, as under the old GATT, trade disputes will be 
submitted to international panels for review. However, unlike the old 
GATT system, no WTO member nation will have the right to block the 
adoption of a panel report, even if that nation considers the panel 
report to be fundamentally flawed in its analysis. Thus, no WTO member 
nation will be able to ignore the findings of a dispute settlement 
panel without paying a price: international condemnation, weakened 
international respect for the trading rules, and possible 
internationally sanctioned retaliation against its goods. The enhanced 
power of the dispute settlement panels requires that this process be 
used prudently and administered wisely for the sake of the world 
trading system in general and American national commercial interests in 
particular.
  The bill we are introducing establishes the WTO Dispute Settlement 
Review Commission composed of five Federal appellate judges, appointed 
by the President in consultation with Congress. The Commission will be 
empowered to review every decision adverse to the United States by a 
WTO dispute settlement panel. In cases where the dispute settlement 
panels adhered to the proper standard of review, and where they did not 
exceed or abuse their authority, no further action will be taken. But 
if the Review
 Commission determines that a panel reached an inappropriate result 
that amounts to abuse of its mandate, the Commission would transmit 
that determination to Congress. Any Member of Congress would then be 
permitted to introduce a privileged resolution and, if such resolution 
were enacted, the U.S. Trade Representative would be required to enter 
into negotiations to amend the WTO dispute settlement rules. After 
three determinations of inappropriate decisions by dispute settlement 
panels, any Member could introduce a privileged resolution and, if such 
resolution were enacted, the United States would be required to 
withdraw from the WTO.

  This bill is very similar to legislation already introduced in the 
other body by Senator Dole to implement an agreement he reached last 
year with the administration to protect against just such a threat to 
U.S. sovereignty by the WTO. It differs only in that it clarifies that 
it is the U.S. Trade Representative who is responsible for negotiations 
to amend the WTO rules if a joint resolution is approved by Congress. 
It is a farsighted proposal that permits the United States to exercise 
international leadership. Through the careful review of WTO decisions 
by the Review Commission, we will be able to prevent countries who 
engage in unfair trade practices from abusing the role of the WTO 
dispute settlement panels. The United States will be in a position to 
oversee the operation of these panels to ensure that any such abuse 
does not adversely affect U.S. trade laws and ultimately, American 
national commercial interests.
  Another important feature of this bill is the provision permitting 
the participation of U.S. private parties in the consultations and 
panel proceedings. If a U.S. private party with a direct economic 
interest in a WTO proceeding supports the U.S. Government's position, 
then the USTR must permit the party to participate in the WTO panel 
process. The USTR must consult in advance with the party before 
submitting written briefs to a panel, include the party as an advisory 
member of the U.S. delegation dealing with the dispute, and in certain 
instances, permit the party to appear before the panel hearing the 
case.
  Private party participation is a key aspect of this bill. Because the 
dispute settlement decisions will be binding, it is imperative that 
American interests be properly represented. Given the USTR's active 
schedule in representing the United States in a variety of trade 
matters, the assistance private parties can provide will be crucial.
  We welcome the support of our colleagues in cosponsoring this 
important legislation.


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