Since the 18th century, the multilateral trading system has evolved and grown after several twists and turns, driven both by the historical trend of free trade and by the influence of individual countries – as was the case with the British-led establishment of the Cobden Trade Network in 1860, and the U.S.-led establishment of the General Agreement on Tariffs and Trade (GATT) in 1947. WTO rules, however, have a distinctly multilateralist character, and have effectively promoted trade liberalization over the past thirty years, completely changing the history of one country’s domination of global trade and its rules.
However, the WTO is also facing many dilemmas, with the prolonged stagnation of the Doha Round, the suspension of the dispute settlement mechanism, and the emergence of cross-regional free trade agreements one after another, seemingly announcing that it has lost the ability to implement existing rules and is also hardly up to the task of formulating new and emerging rules. Part of the reason can be attributed to the existing WTO system exists in the “principle of forward-looking”, “rules on the backward” and “mechanism of the rigidity of the triple challenge, these three challenges each other.
These three challenges are mutually constrained, resulting in the stagnation of the WTO’s development. Trade-based international regulatory cooperation is characterized by “flexible rules” and “soft governance”, and the promotion of international regulatory cooperation in the form of plurilateral agreements is a possible way to promote the WTO to break this situation in a roundabout and gradual manner, which is particularly constructive for the participation of developing countries in the reform and development of the WTO. It is of constructive significance for developing countries to participate in WTO reform and development.
I. The WTO rules is multilateral in principle , but struggles with core contradictions stemming from the rigidity of its mechanisms and the outdated nature of its specific rules.
(i) Being ahead of its time in principle, the WTO principles of non-discrimination and consensus are unique among international organizations, which not only characterize the value orientation of future international relations but also play a positive role in actual operation, but these principles are ahead of the international political and economic background, which has led to the WTO’s development dilemma. Among the five specific principles of the WTO, “transparency”, “reciprocity” and “flexibility” are procedural and technical principles, while “non-discrimination” and “consensus” are principles of multilateralism. Consensus” is the core feature of multilateralism, which is full of idealism even today – the principle of non-discrimination requires that commodities from different countries be given the same treatment, while the resource factors, production processes, legal systems, etc. behind these commodities are often very different; the principle of consensus is that member states have the right to negotiate in the negotiation mechanism. The principle of consensus is that member states have equal status in the negotiation mechanism, but there is also a huge gap between different members in terms of their stages of development, the construction of their domestic systems, the scale of trade and negotiation capacity. In contrast, the “permanent member mechanism” of the United Nations Security Council and the “basic + share voting rights” of the International Monetary Fund are more able to respond to changes in the contrast between the strengths of countries and are more pragmatic and feasible. The reason why the United States from once the main promoter of GATT and WTO to destroyers, precisely because the existing WTO multilateral mechanism can not be “the same commodity behind the special added value and process” to regulate. However, this “forward-looking” principle is the most precious principle of the WTO mechanism, and developing countries must take the initiative to adhere to it and try to solve the challenge.
(ii) The current mode of operation of world trade and the WTO was established at the beginning of the major changes have taken place, commercial activities are also facing unprecedented restrictions and challenges, a variety of “behind the border” issues emerge one after another, but the WTO rules negotiation has long been stagnant, to promote the transition from “border” to “border” to “border”. The promotion of trade-based regulatory cooperation from “border” to “behind the border” is one of the keys to the future of WTO reform. The issues of “trade and environment, labor standards, investment, competition policy” that plague the Doha Round have always been a difficult problem at ministerial conferences, while these shortcomings have been developed in regional trade agreements – about 70% of the issues in the CPTPP are within-border issues, in the areas of labor, investment, and competition policy, while about 70% of the issues in the CPTPP are within-border issues. are border issues, in labor, environment, intellectual property protection, state-owned enterprises and other chapters of the provisions are involved in the contracting parties to the domestic regulations or policies of the constraints or adjustments, has gone far beyond the traditional trade rules of the border issues. Since then, the USMCA has incorporated a large number of new TPP (CPTPP) rules mentioned above on the basis of NAFTA rules, and the RCEP also has a textual similarity of 49.25% with the CPTPP. The core feature of this trend is the “deepening” of FTA provisions from “border” to “post-border” domestic regulation, i.e., the special characteristics of the production and distribution process of goods are “regulated, regulated, and distributed”. “Rules, regulations, management, standards” on the coordination and harmony. This is not only the result of the political game, but also the international political and legal expression of the collective will for the unsustainability of the current international trade system in terms of distribution, resources and rules. In addition, artificial intelligence, green economy and other rules are also developing rapidly, WTO reform and one of the core tasks is to promote these “behind the border” issues of rules and regulations, in response to the “complexity of trade issues” needs.
(iii) the rigidity of the mechanism: the WTO’s multilateralism inherently requires international trade rules to treat different countries and commodities on an equal footing, but the emerging rules require a distinction between countries and commodities in the “rules, regulations, management, standards” on the special nature of this contradiction exists in many negotiation issues, and the WTO This contradiction exists in many negotiation issues, and the WTO “unanimous consent” and “single undertaking” and other rigid negotiation mechanism is difficult to solve this contradiction, we must explore flexible and gradual cooperation for reform. The single undertaking negotiating method originated from the Uruguay Round has been extended to the Doha Round, which includes almost all the issues currently involved in the multilateral trading system, and is one of the important obstacles of the mechanism leading to the stagnation of the negotiations. In the nearly two decades since the plurilateral agreement was reached in 1997, the WTO has made little progress in trade liberalization. Plurilateral agreements have been promoted by many scholars as a form of narrowing the scope of negotiating members to contribute to the outcome of the negotiations, but it is worth noting that closed plurilateral agreements have triggered the concerns of non-participating parties about exclusivity, while open plurilateral agreements have the problem of free-riding by other countries, so there is a need to make innovative use of the plurilateral agreement model, and the combination of plurilateral agreements and international regulatory cooperation can reduce the resistance from all sides. The combination of plurilateral agreements and international regulatory cooperation can reduce resistance from all sides.
II. International regulatory cooperation has the characteristics of “flexible rules” and “soft governance”, and is a progressive path to solve the core contradictions of the WTO.
International regulatory cooperation is aimed at eliminating trade barriers caused by “post-border measures”, its early connotation mainly emphasizes the unity of technical standards, but its definition is still in practice, constantly expanding and extending, broadly speaking, international regulatory cooperation can be summarized as the post-border measures in the “rules, regulations, management, standards” coordination and unity, which can be summarized in the “rules, regulations, management, standards” coordination and unity. The coordination and unification of “rules, regulations, management, standards”, which is not only the rules and standards of cooperation, but also includes the formulation of rules and standards and implementation of rules and standards of institutions and procedures and supervision of the implementation of rules and standards of institutions and procedures, etc., at present, the international regulatory cooperation has been developed to include trade in services, competition neutrality, transport policy, customs policy, environmental policy, etc., including a variety of fields, under the WTO framework. Under the WTO framework, international regulatory cooperation is usually carried out in the form of plurilateral agreements.
(i) International regulatory cooperation has demonstrated the characteristics of “flexible rules” and “soft governance”, and the “flexibility” of the rules is mainly manifested in the following ways: Firstly, avoiding the “one-size-fits-all” approach; secondly, avoiding the “one-size-fits-all” approach; and thirdly, avoiding the “soft governance” approach. First, avoiding “one-size-fits-all” rules, flexible consultation on heterogeneous domestic regulatory issues, and making exceptional arrangements for special issues, and allowing autonomous participation or reservation; second, emphasizing the inclusiveness of the mechanism and system, and equal cooperation based on science and reciprocity, and adhering to the principles of transparency and goodwill to carry out exchanges and fusion of regulations and policies; third, applying “constructive rules” on specific provisions; and third, adopting “flexible rules” and “soft governance” features. The third is the application of “constructive ambiguity” in specific provisions, fully taking into account the industrial level and development needs of different countries, so that the legal provisions have more room for interpretation; the “softness” of governance is manifested in the following ways: firstly, it emphasizes the development-oriented approach, and promotes the integration and coordination of domestic regulations through economic cooperation and technical assistance; and secondly, it stresses the importance of the development-oriented approach and the development-oriented approach. The “softness” of governance is manifested in the following: first, emphasizing development orientation and promoting the integration and coordination of domestic regulations through economic cooperation and technical assistance, instead of only adjusting the rules through the provisions of the rules; second, softly restraining through the establishment of an assessment mechanism and the issuance of implementation reports, setting a more lenient time limit and providing guidance, so as to avoid dispute settlement or unilateral counter-control of domestic regulations; third, establishing a special regulatory cooperation agency, implementing rolling negotiations and phase contracting, and cooperating with other international organizations to conduct “trade plus” based on the “trade plus” principle.
Third, establishing a specialized regulatory cooperation body to implement rolling negotiations and stage contracting, and cooperating with other international organizations to carry out international cooperation and common governance based on “trade plus” issues. In fact, the basic spirit of “flexible rules” and “soft governance” played a positive role as early as in the GATT era, when the GATT’s “special and differential treatment” allowed developing countries to be subject to GATT to a lesser extent. The GATT’s “special and differential treatment” which allows developing countries to be bound by GATT disciplines to a lesser extent is a typical representative; in the Tokyo Round, the open plurilateral agreement of the TBT Agreement, which was formed in the form of a “code”, to promote regulatory cooperation, also shows the key role of adopting a flexible and circuitous path in facilitating the WTO negotiations. In addition, the connotation and practice of international regulatory cooperation are still developing, and both the OECD and the new international trade and economic agreements tend to explore “flexible rules” and “soft governance” in the design of specific systems, and some of them have already led to the integration of the two countries’ regulatory bodies. These changes call for a more systematic study of regulatory cooperation. International regulatory cooperation has demonstrated the characteristics of “flexible rules” and “soft governance”, and the exploratory and diversified forms of cooperation in policies, procedures and institutions, avoiding the harsh and single negotiation rules of the WTO, and is an ideal way for developing countries to explore new and sensitive issues and deep provisions, and to solve the problems of emerging and sensitive issues. It is an ideal way for developing countries to explore emerging and sensitive issues and in-depth provisions, and provides a feasible path for solving the contradictions existing in WTO reform.
(ii) The WTO has always been an important promoter of international regulatory cooperation. The concept of international regulatory cooperation was proposed at the early stage of the negotiations of the General Agreement on Tariffs and Trade (GATT), and the Agreement on Technical Barriers to Trade and the Agreement on the Application of Sanitary and Phytosanitary Measures have been put forward since then. Agreement on Technical Barriers to Trade and Agreement on the Application of Sanitary and Phytosanitary Measures are typical representatives of technical regulatory cooperation, but they are still confined to technical issues, and fail to play an important role in labor, environment, intellectual property protection, state-owned enterprises and other difficult issues, as well as emerging issues such as artificial intelligence and green economy. The breakthrough on this issue came in the 20th century. A breakthrough on this issue occurred in 2022, when 67 WTO members, including China, the EU and the US, formally launched the Reference Paper on Services Domestic Regulations (hereinafter referred to as the SDR Reference Paper), which is an open-ended initiative in the form of a joint statement on cooperation on trade in services regulations. This is an open-ended plurilateral agreement negotiated in the form of a joint declaration initiative on cooperation in the regulation of trade in services, and is the world’s first set of multilateral principles and framework for regulating international trade in services. In December of the same year, 59 participating countries submitted to the WTO to GATS Article 18 additional commitments into the “SDR Reference Document” specific commitment table, marking the first open plurilateral agreement form into the WTO multilateral trade rules system, to crack the WTO for many years in the negotiation stalemate has an important research and reference significance.
(iii) Other international organizations as well as regional trade agreements have also made unremitting exploration on this issue, and formed their own distinctive modes of regulatory cooperation, but they are mainly initiated and guided by developed countries, and developing countries’ attention to and practice on this issue are seriously insufficient. At the level of international organizations, the Organization for Economic Cooperation and Development (OECD) began to explore the path of promoting international regulatory cooperation as early as the 1990s, and set up a special committee on regulatory policy in 2009 to continuously follow up and study the situation of international regulatory cooperation among its member countries; the United Nations Economic Commission for Europe (UNECE) set up a special “Working Group on Regulatory Cooperation and Standardization Policy” to focus on the study and summary of national and international regulatory cooperation and standardization policies. The United Nations Economic Commission for Europe has set up the “Working Group on Regulatory Cooperation and Standardization Policies”, which focuses on researching and summarizing the experiences of national, regional and global technical standards, regulations, testing and evaluation and related activities, and exploring the ways of good regulatory practices and the paths of international regulatory cooperation; at the level of RTAs, such as the TPP/CPTPP’s Guided Regulatory Cooperation Rule, the rules of Guided Regulatory Cooperation guide the members to realize “good regulatory practices” through demonstration. At the level of RTAs, such as TPP/CPTPP, the guiding regulatory cooperation rules guide members to achieve “good regulatory practice” by demonstrating the “good regulatory practice” of members, but state that it is not appropriate to take a country’s domestic legal system as a demonstration requirement, and that it can adopt a problem-oriented approach to enable members to carry out practice in the light of their own national conditions, and introduces the first time of introducing the Regulatory Impact Assessment (RIA), which encourages regulatory bodies of the Contracting Parties to carry out the RIA in accordance with their own laws and regulations when formulating the regulatory measures covered by them. The coordinated regulatory cooperation rules of TTIP focus on the coordination and integration of the different rules of its members, but do not take cost-benefit analysis as the inevitable choice for regulatory impact assessment; bilateral and multilateral agreements such as the USMCA have also set up special chapters on the topic of international regulatory cooperation, and put forward the main objectives and paths and measures for strengthening regulatory cooperation among the countries under the agreement. It is worth noting that the developing countries in the WTO multilateral platform on the relevant issues of fear, but make themselves in bilateral and regional trade agreements more passive.
III. Strengthening multilateral international regulatory cooperation based on trade is of special significance to developing countries. A special regulatory cooperation committee should be established to promote regulatory cooperation exploration on emerging and sensitive issues.
(i) International regulatory cooperation initiatives under the WTO should adhere to the “flexible rules” and “soft governance” approach, emphasize economic and technical cooperation, use international regulatory cooperation to build consensus on development, and cultivate the willingness of developing countries to cooperate under the WTO system.
(ii) International regulatory cooperation not only emphasizes the connection of “rules, regulations, management, and standards”, but also requires the above goals to be achieved through cooperation in “policies, procedures, and institutions”. China should advocate the establishment of a special international regulatory cooperation committee within the WTO, promote different countries to establish internal regulatory cooperation institutions, adhere to the WTO multilateral principle, and widely invite international organizations, multinational companies, etc. to participate in the regulatory cooperation agenda setting and institution building.
(iii) International regulatory cooperation under the WTO should focus on promoting negotiations on emerging issues and promoting regulatory cooperation on “trade +” issues. Among them, labor and environment, digital trade, competitive neutrality, intellectual property protection, multilateral investment, artificial intelligence, etc. are key areas that developing countries urgently need to explore and respond to.