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Published online by Cambridge University Press: 25 June 2018
In 2016, the US objected to the reappointment of a member of the WTO Appellate Body, ‘accusing’ him inter alia of having participated in a decision where the Appellate Body had indulged in unnecessary analysis in the nature of obiter dicta. Henry Gao has used the occasion to investigate, with a fresh approach, the very concept of obiter dicta in international jurisprudence.
1 Appellate Body Report, Argentina – Measures Relating to Trade in Goods and Services, WTO/DS453/AB/R, adopted 14 April 2016.
2 See Statement by the United States at 23 May DSB Meeting, https://geneva.usmission.gov/wp-content/uploads/2016/05/May-16-DSB.pdf, with reference to the previous statement made at the DSB meeting of 9 May 2016.
3 Appellate Body Report, United States − Measures Affecting Imports of Woven Wool Shirts and Blouses from India, WT/DS33/AB/R & Corr.1 at 19 original footnote.
4 On some of these issues, see the present author ‘The WTO Dispute Settlement System in 2016’, Italian Yearbook of International Law, vol. 26-2016, Brill, 2017, pp. 449−486, also available at SSRN, The WTO in 2016: Systemic Developments at the WTO and at the Dispute Settlement System and Review of the Appellate Body's Reports, ID 2940107.
5 Appellate Review – Standing Appellate Body, para. 6
6 Appellate Body Report, Brazil − Measures Affecting Imports of Retreaded Tyres, WT/DS322/AB/R, adopted 17 December 2007, para. 257.
7 Appellate Body Report, WTO/DS457/AB/R, adopted 31 July 2015.
8 This is made clear by the various provisions concerning adoption of the reports and implementation (such as Articles 17.14, 19.1, and 21.3). See also the provisions (Article 3.3.2,and 19.2 of the DSU) that enjoin the DSB, the panels, and the Appellate Body from adding to or diminishing the rights and obligations and reserve to the Ministerial Conference and the General Council ‘the exclusive authority to adopt interpretations’ of the WTO agreements (Article IX.2 of the WTO Agreement).
9 See Appellate Body Report, United States − Final Anti-Dumping Measures on Stainless Steel from Mexico, adopted 20 May 2008, WTO/DS344/AB/R, paras. 156−162.
10 This approach has been defended by Judge Robert Fitzmaurice in his dissenting Opinion in the Barcelona Traction case, ICJ Reports, 1970, 64, para. 2 with reference to the authority of Sir Hersch Lauterpacht. See by the latter, The Development of International Law by the International Court, Cambridge University Press, 1982, p. 21.
11 See the recent discussion concerning the use in international investment arbitration of the Chorzow Factory criteria on the components of damages due in case of breach of an international obligation (PCIJ, 1928), Ratner, Steven, ‘Compensation for Expropriations in a World of Investment Treaties: Beyond the Lawful/Unlawful Distinction’, American Journal of International Law, 111 (2017): 7−56CrossRefGoogle Scholar. For a methodical use of the Chorzow Factory principles in a recent case, see, instead, Brigitte Stern dissenting opinion in Quiborax v. Bolivia, ICSID Case No. ARB/06, Judgement of 16 September 2015.
12 See the ICJ judgement of 4 February 2002, Arrest Warrant Case (Democratic Republic of Congo v. Belgium), where the Court opined that the immunity of the foreign minister of Congo it had upheld in accordance with international customary law in a case where he was accused of international crimes did not imply impunity, and that international criminal courts may well be endowed with jurisdiction to which immunity could not be opposed. This statement was irrelevant for the decision by the ICJ, which upheld the immunity, but it has been taken up by other international criminal tribunals as an indication that immunities cannot block their jurisdiction. See on the specific point Alexandre Skander Galand, Judicial Pronouncements in International Law: The Arrest Warrant Case ‘Obiter Dicta’, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3049225.
13 In fact, parties in disputes at the WTO quote extensively previous reports by the Appellate Body (without distinguishing the ‘status’ of the holdings referred to) and are entitled to rely on its legal reasoning, see Appellate Body Report, United States − Import Prohibition of Certain Shrimp and Shrimp Products (Article 25 – Malaysia), WT/DS58/AB/WR, adopted 21 November 2001, paras. 107−109. However, the Appellate Body has stressed that WTO law is found in the ‘covered agreements’ not in previous Appellate Body reports that interpret and apply it. The Appellate Body has given some recognition to the concept of orbiter dicta when it pointed out there ‘The reasoning in our Report in United States – Shrimp on which the Panel relied was not dicta; it was essential to our ruling. The Panel was right to use it, and right to rely on it.’
14 In civil law jurisdictions, the highest courts may elaborate on legal principles that are clearly not necessary to decide the case before them to the point to express them in ways that make them binding for lower courts. Thus, in a much discussed recent decision, the Italian Supreme Court in Full Bench (Cassazione, sezioni unite) changed its jurisprudence and officially admitted, with binding effects on lower courts (pursuant to art. 363 of the Italian Code of Civil Procedure), that within certain limits US decisions awarding punitive damages are not contrary to Italy's public order and may be recognized, although the US decision at issue had most likely, as recognized by the Supreme Court itself, not awarded punitive damages (decision No. 16601/2017).
15 Reference to a recent decision by the European Court of Justice, which is being currently much discussed within investment law arbitration, is appropriate in this respect. The ECJ (Grand Chamber) in its Achmea judgment of 6 March 2018 (Slovak Republic v. Achmea BV, preliminary ruling requested by the German Federal Court of Justice), has declared that the arbitration clause between investors and a host State in an intra-EU Bilateral Investment Treaty (BIT) is incompatible with EU law. The ECJ has relied on several arguments whose relative importance and possible application in similar disputes but in different contexts (for example, in ICSID arbitrations rather than in UNCITRAL arbitration taking place within the EU like in Achmea, or where the BIT does not call for the application of EU law) are hotly debated.
