The Impact of the WTO Dispute Settlement System on China : Effectiveness, Challenges and Broader Issues

To reflect on China's 20 years in the World Trade Organization (WTO), this chapter offers an overview and some critical analysis of China's implementation of the rulings of the WTO's dispute settlement system (DSS). It shows that China has maintained an impressive record of compliance, which is a clear proof of the effectiveness of the DSS. Specifically, the DSS has caused not only changes to specific policy instruments but also systematic adjustments of China's complex regulatory regime in an incremental manner. This chapter then examines three systemic challenges for the DSS - i.e. temporary breaches, repetitive breaches and post-compliance regulatory developments - while contending that these challenges are not specific to China but apply to all WTO Members. It ends by offering some observations on the growing debate over the broader issues relating to China's economic model and compliance with the spirit of WTO rules. While these issues remain highly controversial, a functional DSS is urgently needed to maintain its impact on China. Otherwise, countries that are keen to push China to further economic reforms will lose an important policy option (i.e. multilateral disciplines) while other approaches (i.e. unilateral measures) have proven less effective or even counter-productive in dealing with the rising global superpower