January 12, 2015
The World Trade Organization at 20
Overview
Trade Facilitation Agreement (TFA)
One of the new commitments, the TFA, aims to remove
The World Trade Organization (WTO) was established on
customs obstacles at the border. Its provisions:
January 1, 1995, following the ratification of the Uruguay
• Establish “single window” procedures for accepting
Round Agreements (URA). It succeeded the General
trade documentation;
Agreement on Tariffs and Trade (GATT), which was
• Require expedited release of goods into air cargo
created in 1947 as a part of the post-WWII effort to build a
facilities;
stable, open international economic framework. The WTO
has three basic functions: (1) administers existing
• Institute trusted trader programs for screened operators;
agreements; (2) serves as a negotiating forum for new trade
• Provide for pre-clearance customs procedures and post-
liberalization; and (3) provides a mechanism to settle trade
clearance audit procedures;
disputes among the parties. WTO agreements cover goods,
• Establish electronic payment for customs duties and
services and agricultural trade, remove tariff and nontariff
advanced rulings for tariff classifications; and
barriers, and establish disciplines on government practices
• Mandate binding commitments for countries
that directly relate to trade—for example, trade remedies,
implementing reforms and countries providing trade
technical barriers to trade, customs valuation, intellectual
capacity building.
property rights, and government procurement. The WTO
agreements are based on the principles of
Countries are to decide whether each commitment is to be
nondiscrimination, national treatment among countries, and
implemented upon the agreement’s entry into force; within
transparency of trade rules and regulations. Some
a set time period after the entry into force; or implemented
exceptions, however, such as preferential treatment for
subject to the provision of technical assistance by
developing countries and regional and bilateral free trade
developed countries and, where possible, advanced
agreements (RTAs), are allowed.
developing countries. Members were required to begin the
The Doha Round
ratification process by notifying the WTO by July 31 of the
trade facilitation commitments they plan to implement upon
The Doha Development Agenda “round” of multilateral
entry into force, with other commitments to follow. The
trade negotiations was launched in November 2001. The
future of the agreement was thrown into doubt when India
negotiations have been characterized by persistent
blocked this process from beginning due to its desire to
differences among the United States, the European Union
protect its food security subsidy programs from WTO
(EU), and developing countries on major issues, such as
scrutiny. In November 2014, however, the United States
agriculture, industrial tariffs and nontariff barriers, services,
and India negotiated a compromise creating a “peace
and trade remedies. For example, developing countries
clause” to protect these programs from challenge pending
(including emerging economic powerhouses such as China,
negotiations on their future, while allowing the overall
Brazil, and India) have sought the reduction of agriculture
agreement to be implemented.
tariffs and subsidies among developed countries,
nonreciprocal market access for manufacturing sectors, and
We have put the world back in the World Trade
protection for their services industries. In contrast, the
Organization. Roberto Azevêdo, WTO Director
United States, the EU, and other developed countries have
General, December 7, 2013.
sought commercially meaningful access to developing
countries’ industrial and services sectors while attempting
Agriculture and Development
to retain some measure of protection for their agricultural
The agriculture and developmental aspects of the Bali
sectors. The growing clout of developing countries—which
agreements contain more hortatory commitments. These
played a peripheral role in the early days of the GATT—as
include a temporary peace clause for a developing country’s
well as the increasing complexity of the negotiations, have
purchases of commodities for food-security stockholding
contributed to the stalemate.
programs—which, to some, represents a backtracking from
previous Uruguay Round commitments; a reaffirmation to
The Bali Ministerial
eliminate export subsidies as part of the Doha Round;
The Bali package, an agreement reached at the WTO
commitment to a successful outcome in cotton negotiations
Ministerial in December 2013, consists of new
with least-developed countries (LDCs); a renewed pledge to
commitments on trade facilitation, agriculture, and
improve duty-free, quota-free (DFQF) market access for
development that were agreed by the Members.
LDCs; the adoption of simplified rules-of-origin for

preference programs; and a services waiver for service
exports from LDCs.
www.crs.gov | 7-5700

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The World Trade Organization at 20
Table 1. GATT/WTO Rounds
negotiations for an Environmental Goods Agreement
(EGA) were announced in January 2014 by 14
Year
Name
Subjects covered
Countries
countries, including the United States and China,
representing 86% of global trade in such goods. The
Geneva,
talks are expected to be handled as an open plurilateral,
Annecy,
1947-
5 Rounds of tariff
23 (1947); 26
i.e., the agreed tariff reduction or elimination would be
Torquay,
1961
reductions
(1961)
applied on a most-favored-nation (MFN) basis to all
Geneva II,
WTO members, similar to the ITA
Dillon
Future Challenges
1964-
Tariffs and anti-dumping

Kennedy
62
1967
measures
The successful conclusion of the Bali Ministerial has
infused new life into the Doha Round agenda. In Bali,
Tariffs, anti-dumping,
Ministers committed to revise their work program in 2014
subsidies, technical
to bring the negotiations to a conclusion. However, the
1973-
Tokyo
barriers to trade,
102
WTO continues to face several challenges to its effective
1979
government
stewardship of the global trading system.
procurement
The Doha Round. After 13 years, many intractable issues
remain unresolved. While developing countries remain
Tariffs, nontariff
focused squarely on agriculture, developed countries have
measures, rules, services,
linked ambition in agriculture to reciprocal ambition in
1986-
intellectual property,
industrial tariffs and services liberalization, especially for
Uruguay
123
1994
dispute settlement,
advanced emerging market economies. These divisions
textiles, agriculture,
have called into question the viability of the “single
WTO institution
undertaking” (one package) type of negotiation and the
need for institutional reform.
Tariffs, nontariff
Dispute Settlement. The dispute settlement (DS) system is
measures, agriculture,
considered a success of the existing WTO system. Some are
Doha
services, trade
142 (2001);
concerned about the continued legitimacy of the DS system
2001-
Development facilitation, trade
160 (current)
if no further WTO agreements are reached.
Agenda
remedies, and
development
Table 2. WTO Dispute Settlement
Source: WTO.
Total cases filed
488

Other Initiatives
U.S. as Complainant
107

Aside from the agreements reached at the Bali Ministerial,
U.S. as Respondent
123
several other initiatives are taking place within and around
the WTO. These include a new Government Procurement
U.S. as Third Party
118
Agreement and plurilateral negotiations on:
•
Source: WTO.
Expanded product coverage subject to tariff-free

treatment in the 1996 Information Technology
Regional Trade Agreements. RTAs have proliferated in
Agreement (ITA). The impasse over China’s request for
recent years. They have the advantage of willing
extensive exclusion of some goods from tariff cuts, and
participants, common goals, and the potential to negotiate
long phase-out periods for others was tentatively
more comprehensive liberalization. They may serve as
resolved by bilateral U.S.-China consultations during
trailblazers for talks on new issues and potentially could be
the 2014 Asia-Pacific Economic Conference (APEC)
linked up with the WTO system in the future. At present,
summit in Beijing. However, objections raised by other
though, they call into question the role of the WTO in
countries have yet to be resolved.
•
negotiating new trade liberalization.
A Trade in Services Agreement (TISA). Launched in
New Issues. Since the launch of Doha Round 2001, new
April 2013 among 23 countries, including the EU, it
issues, such as digital trade (data flows, cybertheft, and
seeks to expand commitments to the WTO General
trade secrets), state-owned enterprises, new nontariff
Agreement on Trade in Services (GATS). While this
barriers, global supply chains, and the relationship between
negotiation is not being conducted under the auspices of
trade and environment rules are new challenges to the
the WTO, it may be incorporated into it in the future.
trading system. Some fear the WTO is falling behind, while
China has expressed interest in joining the TISA
these issues are being left to plurilateral or regional FTAs.
negotiations, but the United States has sought
preconditions on China’s membership to assure an
Ian F. Fergusson, ifergusson@crs.loc.gov, 7-4997
ambitious outcome.

• Tariff elimination for environmental goods.
Contemplated in the Doha Round for several years, new
IF10002
www.crs.gov | 7-5700

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