On September 5, 2022, the sixth “Tang Lecture” organized by China International Economic and Trade Arbitration Commission (“CIETAC”) was successfully held in Beijing as one of the key events during the 2022 China Arbitration Week. This year’s Tang Lecture invited Ms. Zhang Yuejiao, the first Chinese former member  and Chair of the Appellate Body  of the World Trade Organization (WTO) and Professor of Tsinghua University School of Law , as the guest speaker to share in-depth information and insightful opinions on the achievements of, the challenges faced by, and the reform proposals to the dispute settlement mechanism of the WTO. Mr. Wang Chengjie, the Vice Chairman and Secretary-General of CIETAC, delivered an opening speech. Mr. Xu Yanbo, the Secretary of the Party Committee and Deputy Secretary-General of CIETAC, presided over the event. This year’s Tang Lecture was held offline and online, and the total volume of viewing of the online live broadcast at home and abroad was nearly 120,000.

(Mr. Wang Chengjie, the Vice Chairman and Secretary-General of CIETAC, delivered an opening speech.)

In his opening speech, Mr. Wang Chengjie pointed out that since the inception of the Tang Lecture in 2017, it has always adhered to the purpose of promoting the concept of arbitration, facilitating the cultural exchanges of international arbitration, promoting the development of international arbitration and creating an international arbitration exchange platform, and has become one of the most important events that have attracted much attention during the China Arbitration Week. One of the most hotly discussed topics in international dispute resolution this year is the reform of the dispute settlement mechanism of the WTO. In recent years, the WTO Appellate Body has fallen into a crisis of suspension, which has overshadowed the “crown jewel”, i.e., the WTO dispute settlement mechanism. As an important member of the WTO and an advocator of multilateralism, China actively responded to the crisis of the Appellate Body and joined hands with some WTO members such as the EU to establish the interim appeal arbitration mechanism  in 2020, and actively led the negotiations at the 12th WTO Ministerial Conference , which led to the achievement of various negotiation outcomes. Arbitration is one of the most important diversified dispute resolution methods. As the first arbitration institution in China and one of the five most preferred arbitration institutions in the world, CIETAC has always paid attention to the new development of arbitration theory and practice and strived to contribute to the development of arbitration and international dispute resolution mechanism. The theme of this year’s seminar is “The Restoration and Reform of the WTO Appellate Body”, which is to enable all fields to better understand the key topic of WTO dispute settlement mechanism reform and to contribute Chinese wisdom and solutions to the reform of the WTO dispute settlement mechanism.

(Ms. Zhang Yuejiao, former member and Chair of the Appellate Body  of the WTO and Professor of Tsinghua University School of Law , delivered the keynote speech)

In her keynote speech, Ms. Zhang Yuejiao deeply remembered Mr. Tang Houzhi and thanked CIETAC for setting up the Tang Lecture to spread the culture of arbitration. She compared the dispute settlement mechanisms of the WTO  and International Centre for Settlement of Investment Disputes  (ICSID) in terms of jurisdiction, application of law, enforcement of decisions or awards, and appeal procedures; introduced the basic principles and objectives and main functions of the WTO; introduced the WTO dispute settlement procedures, with emphasis on the procedures for appellate review. She pointed out that the WTO dispute settlement mechanism is known as the “crown jewel”, but now the WTO is facing problems such as slow decision-making, financial constraints, and that the rules are unfair for emerging economies and new members; there are also many problems in the procedures for appellate review  of the WTO, such as the lack of the right to remand the case, the lack of explicit authorization for the Appellate Body to complete the analysis  and exercise judicial economy , and the time limit for appellate review is too short. Regarding the WTO dispute settlement mechanism, members put forward suggestions such as increasing transparency, making panel members more professional, increasing the rights of third parties and add provisions on the handling of amicus curiae briefs, allowing partial adoption of the reports of panels and the Appellate Body, and constructing a remand mechanism, etc.

According to Ms. Zhang Yuejiao, the following ten reforms can also be made to the WTO dispute settlement mechanism: First, the doctrine of paperwork should be changed, and thus the documents issued by the Appellate Body and the written submissions by the parties should be easy to understand. Second, certain provisions of the covered agreements of the WTO  need to be amended or interpreted by the Ministerial Conference. Third, the 90-day time limit for appellate review should be re-clarified or appropriately extended. Fourth, the Appellate Body and the Dispute Settlement Body (DSB) should not interfere with WTO members’ own domestic legislation by interpreting their members’ internal laws. Fifth, it is emphasized that the Appellate Body should comply with its responsibilities under the Understanding on Rules and Procedures Governing the Settlement of Disputes  (DSU) and comply with the covered agreements of the WTO. Sixth, if approved by the DSB, members of the Appellate Body whose terms of office expire should be allowed to complete the cases assigned to them during their terms of office. Seventh, the term of office of the  Appellate Body members shall be extended. Eighth, there should be provisions on the authority to issue “emergency provisional measures” in the WTO dispute settlement mechanism. Ninth, experts, “judges” and lawyers should be broadly representative of WTO members. Tenth, all participants in dispute settlement should abide by a strict code of conduct, and the DSB should have a supervisory function.

After the keynote speech, two senior arbitrators of CIETAC, i.e., Ms. Zhao Hong, former member of the WTO Appellate Body and professor of Peking University Law School, and Dr. Dong Xiao, partner of JunHe Law Firm , made excellent speeches.

(Ms. Zhao Hong, former member of the WTO Appellate Body and professor of Peking University Law School delivered her speech)

Professor Zhao Hong pointed out in her speech that the Appellate Body represents the high level of judicial character of the international dispute adjudication mechanism and has contributed to the enhancement of consistency in adjudication, so it is important to uphold and maintain the “two-tiered system” of WTO dispute settlement. From the practical point of view, common law has a greater impact on the international dispute adjudication mechanism. For the WTO dispute settlement mechanism and the appellate body, the following four aspects of reform can be carried out: First, the appellate body should be restored as soon as possible on the basis of clarifying the authorization, which is also a preferential option. Second, retain the error correction mechanism of two-level hearings, as this represents progress in the rule of law. Third, follow up on the reform of the first instance procedure (i.e., the panel procedure). Fourth, allow disputants to use their mother tongue as the language of the proceedings.

(Dr. Dong Xiao, partner of JunHe Law Firm , delivered his speech)

From the perspective of comparing the dispute resolution system of international commercial arbitration and the dispute resolution mechanism in the context of public international law, Dr. Dong Xiao talked about of his feelings and thoughts in three aspects. First, the space and opportunities for the parties to a dispute to participate in the design of dispute resolution structures. Under the dispute settlement mechanism of public international law, private subjects have little opportunity to participate in the setting of the mechanism; in commercial arbitration, commercial subjects have sufficient freedom and space to discuss the dispute resolution mechanism. Second, the parties’ right to choose adjudicators. In fact, wheter it is in the procedures for appellate review or the procedures for interim appeal arbitration, the space for the parties to a dispute to choose adjudicators is relatively limited. In commercial arbitration, the parties generally have the right to choose arbitrators, but some argue that the parties’ right to choose arbitrators should be restricted and eliminated. Thirdly, there are different international views and practices on whether parties should be given the opportunity to appeal in international disputes, which is also worthy of our consideration.

(Ms. Teresa Cheng, former Secretary for Justice of the Department of Justice of the Hong Kong Special Administrative Region  and a senior arbitrator of CIETAC, delivered her speech)

As a special guest of this year’s Tang Lecture, Ms. Teresa Cheng, former Secretary for Justice of the Department of Justice of the Hong Kong Special Administrative Region and a senior arbitrator of CIETAC, also made a wonderful speech. She said that although Mr. Tang Houzhi had passed away, his spirit was with us. In the past, most of the topics of the Tang Lecture were international arbitration, but this year, the topic was expanded to other dispute settlement mechanisms, which is very meaningful. Ms. Teresa Cheng shared her thoughts from three aspects: First, under different dispute resolution mechanisms there are different practices regarding whether it is needed to stare decisis, but the consistency of adjudication (at least predictable consistency) is in line with the spirit of the rule of law, which also reflects the influence of common law. Therefore, in the cultivation of talents of foreign-related rule of law, it is needed to cultivate their common law thinking. Second, the absence of an appeal procedure for arbitration raises certain concerns. For investment arbitration, it is worth thinking about whether some form of appeal mechanism is needed so as to maintain consistency in the interpretation of important treaties. Third, it is important to continue Tang’s work and promote the combination of “mediation and arbitration”.

After the talk, Professor Zhang Yuejiao , Professor Zhao Hong and Dr. Dong Xiao enthusiastically answered questions from the audience.

(Mr. Xu Yanbo, the Secretary of the Party Committee and Deputy Secretary-General of CIETAC, gave his concluding remarks)

Finally, Mr. Xu Yanbo, Deputy Secretary-General of CIETAC, thanked all guests for their wonderful sharing in his concluding remarks. He pointed out that the current crisis of the WTO dispute settlement mechanism originated from the crisis of the suspension of the Appellate Body, and it is necessary to reform the Appellate Body in order to resume the operation of the Appellate Body. Moreover, the reform of the Appellate Body will also become the core of the reform of the WTO dispute settlement mechanism. The good operation of the Appellate Body and the WTO dispute settlement mechanism is not only related to China’s interests, but also to the common interests of all WTO members. As an important member of the WTO, China is indeed necessary to promote the reform of the Appellate Body and has the obligation to lead the reform of the WTO dispute settlement mechanism. Both commercial arbitration and investment arbitration emphasize the respect for party autonomy and require judicial supervision over arbitration. The dispute settlement between WTO members is a state-to-state dispute settlement, which emphasizes the respect for national sovereignty and the maintainance of a certain degree of member control, as well as guarantees the independence and neutrality of panels and the Appellate Body as adjudicators. These principles and characteristics are consistent with arbitration. It is believed that today’s event will be very rewarding and enlightening for scholars and practitioners in commercial arbitration, investment arbitration, WTO dispute settlement, and even the entire field of dispute resolution.