A multilateral or bilateral mechanism is usually based upon a council, commission or a committee that is composed of the political representatives of the contracting parties in which the trade disputes of the parties are to be resolved through negotiation, consensus and compromise. The principal political body may be assisted in its task by a secretariat or a panel of experts, but the panel or the secretariat does not have binding decision-making powers. The parties may approve the decisions of the panels or the secretariat, but the onus is on each party to carry out the accepted decisions of the political body. If the decisions are not carried out, certain measures may be sanctioned by the political body and imposed by the other parties to the agreement.
The multilateral institution is based on the classical model of relations among nations in the international arena. It protects (however nominally, as will be seen) the sovereignty of the parties, while providing a formal mechanism through which influence and power can be exercised to impose discipline on practices in dispute and to bring the disputants to an agreement. Although often operating within a specified paradigm and concrete rules, the political dispute-resolution framework is based on bargaining among interested parties, thus allowing parties to determine for themselves the extent to which they will barter trade advantages with constraints on their sovereign actions.
The GATT embodies the largest, and the first, multilateral international trade dispute resolution institution. Much has already been
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Publication information: Book title: Industrial Subsidies and Friction in World Trade: Trade Policy or Trade Politics?. Contributors: Rambod Behboodi - Author. Publisher: Routledge. Place of publication: New York. Publication year: 1994. Page number: 50.
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