THE CRISIS OF THE WTO DISPUTE SETTLEMENT SYSTEM: JUDICIALIZATION, LEGITIMACY AND INSTITUTIONAL REFORM

Abstract

This article examines the crisis of the World Trade Organization Dispute Settlement System, focusing on the paralysis of the Appellate Body, the increasing judicialization of trade adjudication, questions of institutional legitimacy, and the need for reform. The WTO dispute settlement mechanism was originally designed to provide a rules-based alternative to power-based trade relations. However, the non-functioning of the Appellate Body since December 2019 has weakened the finality, predictability and enforceability of WTO dispute settlement. The article argues that the crisis is not merely procedural, but reflects a deeper tension between judicial authority and state sovereignty. It also evaluates interim alternatives such as Article 25 arbitration and the Multi-Party Interim Appeal Arbitration Arrangement. Although these mechanisms provide temporary solutions, they cannot fully replace a universally accepted appellate system. The article concludes that sustainable reform requires both procedural restructuring and renewed political consensus among WTO members.