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Multi-Party Interim Appeal Arbitration Arrangement (MPIA)
Members: 52/164
Open Initiative
Status: Operational

In order to maintain the efficacy of the rules-based trading system and for members to continue to have access to an independent appeal process for dispute settlement, 16 WTO members set up a separate appeal system for trade disputes in March 2020.

Known as the Multiparty Interim Appeal Arbitration Arrangement (MPIA), it is an alternative system for resolving WTO disputes that are appealed by a Member, in the absence of a functioning and staffed WTO Appellate Body.

WTO members can resort to the use of the MPIA under Article 25 of the WTO Dispute Settlement Understanding, as an alternative mechanism for dispute settlement.  The MPIA embodies the WTO appellate review rules and in a dispute between members, it will supersede the previous appeal processes and also apply to future disputes between members.

By notifying the Dispute Settlement Body any WTO member can join the MPIA and the system is likely to remain in place for as long as the Appellate Body is not functioning.

In a final step operationalise MPIA, in July 2020 ten arbitrators were appointed to hear the appeals of WTO panel reports under the MPIA.

For disputes among those members that are party to it, the MPIA serves as a temporary solution to the WTO Appellate Body gridlock.

 

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About this Plurilateral
The Non-Functioning WTO Appellate Body

In October 2018, the United States blocked the appointment of new Appellate Body members, resulting in only 3 members remaining on the Body. At the end of their terms, the Appellate Body was rendered non-functional as it lacked a quorum under its rules. The United States blockade on appointments remains in place, and the Appellate Body continues to be non-functional to this date. The US claims that the Appellate Body is unfair and does not support US or other WTO members’ interests. The US’s main objections about the system relate to its view that the it has repeatedly overstepped its limits and created new rules never envisaged by the signatories; that it sets up persuasive precedents for future disputes, and that it has procedural problems such as the practice of taking on new cases before clearing the backlog of existing ones. In February 2019 David Walker, New Zealand’s Ambassador to WTO, was appointed to work with WTO members to resolve the issues preventing the functioning of the Appellate Body, including addressing US concerns. Though there have been constructive discussions on this issue in Geneva and in capitals, few expect a resolution in the immediate future. Videos and discussions:

 

Creation of the MPIA

On 30 April 2020, a group of 47 WTO members notified the organization of the creation of a new Multi-Party Interim Appeal Arbitration Arrangement (or MPIA) and their intention to resort to use of this mechanism to aribrate any WTO disputes among themselves which would otherwise be appealed to the non-functional WTO Appellate Body. In their formal communication these members indicated their goal was to preserve and replicate the substantive and procedural aspects of the WTO’s appeal aribration procedure including independence and impartiality, while enhancing efficiency. These members also reaffirmed their commitment to resovling the impasse at the WTO Appellate Body and to ceasing the operation of the MPIA as soon as that body was restored to function. In describing this new arrangement, then Trade Commissioner of the European Union Phil Hogan said:

“Today’s agreement delivers on the political commitment taken at ministerial level in Davos in January. This is a stop-gap measure to reflect the temporary paralysis of the WTO’s appeal function for trade disputes. This agreement bears testimony to the conviction held by the EU and many other countries that in times of crisis working together is the best option. We will continue our efforts to restore the appeal function of the WTO dispute settlement system as a matter of priority. In the meantime, I invite other WTO Members to join this open arrangement, crucial for the respect and enforcement of international trade rules.”

Earlier that year, Ministers from the European Union and 15 other signatories issued a statement foreshadowing the formation of the MPIA, saying:

“Further to the Davos statement of 24 January 2020, we, the Ministers of Australia; Brazil; Canada; China; Chile; Colombia; Costa Rica; European Union; Guatemala; Hong Kong, China; Mexico; New Zealand; Norway; Singapore; Switzerland; and Uruguay, have decided to put in place a Multi-party Interim Appeal Arbitration Arrangement (MPIA) on the basis of the attached document. This arrangement ensures, pursuant to Article 25 of the WTO Dispute Settlement Understanding, that any disputes among us will continue benefitting from a functioning dispute settlement system at the WTO, including the availability of an independent and impartial appeal stage.

We believe that such WTO dispute settlement system is of the utmost importance for a rules-based trading system. The arrangement is open to any WTO Member, and we welcome any WTO Member to join. We wish to underscore the interim nature of this arrangement. We remain firmly and actively committed to resolving the impasse of the Appellate Body appointments as a matter of priority and urgency, including through necessary reforms.

The arrangement therefore will remain in effect only until the Appellate Body is again fully functional. We intend for the arrangement to be officially communicated to the WTO in the coming weeks. “

In practice, the MPIA is a political agreement and must be individually invoked in each case between MPIA parties.  When a case involving two MPIA parties arises at the WTO, the parties submit a joint notification to the WTO’s Dispute Settlement Body under Article 25 of the Dispute Settlement Understanding. This states their formal intention to use MPIA procedures to resolve the dispute should it reach the appellate stage, and outlines the procedures the parties intend to follow in this regard.

Parties to the MPIA

The following WTO members are parties to the MPIA: Australia; Benin; Brazil; Canada; China; Chile; Colombia; Costa Rica; Ecuador; European Union; Guatemala; Hong Kong, China; Iceland; Macao, China; Mexico; Montenegro; New Zealand; Nicaragua; Norway; Pakistan; Peru; Singapore; Switzerland; Ukraine and Uruguay.

MPIA Cases

In the following disputes, the parties involved have either submitted Article 25 notifications indicating their commitment to using the MPIA to resolve their dispute should either party decide to appeal the relevant WTO panel’s ruling, or are likely to do so at the panel stage because they are both parties to the MPIA.

Ongoing Disputes

DS583 Turkey – Certain Measures concerning the Production, Importation and Marketing of Pharmaceutical Products
DS589: China — Measures Concerning the Importation of Canola Seed from Canada
  • Complainent: Canada
  • Respondent: China
  • Status: WTO Panel composed on 10 November 2021
  • MPIA: Article 25 Notification
DS591: Colombia — Anti-Dumping Duties on Frozen Fries from Belgium, Germany and the Netherlands
DS598: China — Anti-dumping and countervailing duty measures on barley from Australia
  • Complainent: Australia
  • Respondent: China
  • Status: WTO Panel composed on 3 September 2021
  • MPIA: Article 25 Notification
DS602: China — Anti-Dumping and Countervailing Duty Measures on Wine from Australia
DS603: Australia — Anti-Dumping and Countervailing Duty Measures on Certain Products from China
  • Complainent: China
  • Respondent: Australia
  • Status: Panel established, but not yet composed on 28 February 2022
  • MPIA: No Article 25 Notification has yet but complainent and respondent are MPIA parties
DS607: European Union — Measures Concerning the Importation of Certain Poultry Meat Preparations from Brazil
  • Complainent: Brazil
  • Respondent: European Union
  • Status: Formal consultations commenced on 8 November 2021
  • MPIA: No Article 25 Notification yet as no panel established but complainent and respondent are MPIA parties
DS610 China – Alleged Chinese restrictions on the import and export of goods, and the supply of services, to and from Lithuania
  • Complainent: European Union
  • Respondent: China
  • Status: Request for Consultations on 27 January 2022
  • MPIA: No Article 25 Notification yet as no panel established but complainent and respondent are MPIA parties
DS611 China — Enforcement of intellectual property rights
  • Complainent: European Union
  • Respondent: China
  • Status: Request for Consultations on 18 February 2022
  • MPIA: No Article 25 Notification yet as no panel established but complainent and respondent are MPIA parties

Completed Disputes

[Withdrawn] DS522: Canada — Measures Concerning Trade in Commercial Aircraft
  • Complainent: Brazil
  • Respondent: Canada
  • Status: Withdrawn by complainent on 18 February 2021
  • MPIA: Article 25 Notification
[Finalized] DS524: Costa Rica — Measures Concerning the Importation of Fresh Avocados from Mexico
[Settled] DS537: Canada — Measures Governing the Sale of Wine

Note: Compiling this section would not have been possible without the support of Simon Lester and the International Economic Law and Policy Blog of WorldTradeLaw.net. 

MPIA Arbitrators

On 31 July 2020 the MPIA parties formally announced the initiative’s initial pool of 10 standing arbitrators:

  • Mr Mateo Diego-Fernández ANDRADE
  • Mr Thomas COTTIER
  • Ms Locknie HSU
  • Ms Valerie HUGHES
  • Mr Alejandro JARA
  • Mr José Alfredo Graça LIMA
  • Ms Claudia OROZCO
  • Mr Joost PAUWELYN
  • Ms Penelope RIDINGS
  • Mr Guohua YANG
Key Documents
News

  • MPIA - Arbitration Appeal Requested (Request by Turkey in DS583 - Pharmaceuticals) Turkey informed WTO members on 28 April that it has initiated arbitration proceedings under Article 25 of the Dispute Settlement Understanding (DSU) to review the findings of a WTO dispute panel in “Turkey — Certain Measures concerning the Production, Importation and Marketing of Pharmaceutical Products” (DS583). In addition, Turkey and the European Union, the complainant in the dispute, agreed to make public the panel findings.

  • Grinberg Codovil - Brazil to Apply Unilateral Retaliation in Trade Disputes The Brazilian government confirmed last week that it will publish a Provisional Measure, providing for the possibility of carrying out unilateral retaliation, once it has a favorable decision from the World Trade Organization (WTO) panel and an empty appeal is filed by the represented member country. This action follows the example of the European Union seen in February 2021.

  • IELP Blog - Tweaking the MPIA Procedures In their revised submissions on Article 25 procedures in Costa Rica - Avacados (DS524) and Colombia Frozen Fries (DS591) the parties changed the wording to provide MPIA arbitrators more time to digest panel reports by getting them in sooner.

  • WTO - Appellate Body issues annual report for 2019-2020 The Appellate Body issued on 31 July 2020 its Annual Report covering 2019 and the first half of 2020. The Report includes information about appeals filed by WTO members, the key findings of reports circulated, the composition of the Appellate Body, the participation of WTO members in appeals, procedural issues arising in appeals, and other activities undertaken by the Appellate Body and its Secretariat during this period.

  • WTO - DG Azevêdo to launch intensive consultations on resolving Appellate Body impasse Director-General Roberto Azevêdo told a meeting of the full WTO membership on 9 December that he would launch more intensive, high-level consultations on how to resolve the longstanding impasse over the appointment of Appellate Body members. DG Azevêdo’s intervention came after WTO members were unable to reach consensus on a proposal to address concerns regarding the functioning of the Appellate Body.

Analysis and Articles

  • SRC - What the new Appeal-Arbitration System Might Mean for the Future of WTO Dispute Settlement Author: Dr. Jan Yves Remy

    Even without the United States, the MPIA is a significant development. Just as the GATT – intended as a provisional arrangement – endured for half a century before the WTO was eventually created, the MPIA is likely to serve as a de facto appeal system until and unless another viable option is put on the table. In this SRC Trading Thoughts, the author provides some initial thoughts on the main elements of the MPIA and discuss concerns that non-participating Members, including CARICOM countries, may wish to consider carefully.

  • JoWT - Is the MPIA a Solution to the WTO Appellate Body Crisis? [Paywalled] Author: Olga Starshinova

    This article analyses the legal basis of the MPIA and its negotiating history. It also addresses the differences between the appeal mechanisms provided for in the MPIA and the Dispute Settlement Understanding (DSU) and provides a conceptual discussion with regard to the legal nature of the MPIA. Finally, the article identifies the main advantages and drawbacks of MPIA. It should be taken into account that the effectiveness of the MPIA will only be assessed when any of the disputes submitted for consideration under the MPIA rules is resolved.

  • Lowy - EU the new kingpin in global trade order Author: Kirsten Hopewell

    The author argues that the MPIA is a key part of efforts to make global trade governance less dependent on American leadership and more resilient in the face of US attempts to undermine the rules-based multilateral trading system and that thus the EU is thus playing an important stabilising role in the trading system amid an ongoing US assault.