Page 287 - DMGT401Business Environment

Business Environment

Notes 13.9 Summary

WTO gives an opportunity to the nations to sit together and talk trade. It gives them the
forum where nations can negotiate with the objective of a win-win situation.

WTO agreements include goods, services and intellectual property. It has an objective of
reducing tariffs to zero. It enables liberalisation and allows limited exemption regarding
duties.
The WTO is run by its member-governments. All major decisions are made by the
membership as a whole, either by ministers (who meet at least once ever two years) or by
their ambassadors or delegates (who meet regularly in Geneva).
Many groups operate in the WTO. Some are for economic integration – custom unions,
free trade areas, and common markets, such as the European Union, ASEAN, NAFTA and
MERCOSUR.
In WTO, the Dispute Settlement Body consists of all its members. This body appoints a
panel of experts to consider the case. It has the authority to accept or reject the findings of
the panel.
India is a founding member of the GATT (1947) as well as of the WTO, which came into
effect from January 1, 1995. By virtue of its WTO membership, India automatically avails
of Most Favoured Nation Treatment (MFN) and National Treatment (NT) from all WTO
members for its exports and vice versa.

13.10 Keywords

GATT: General Agreement on Tariffs and Trade

SAARC: South Asian Association for Regional Cooperation
SAPTA: South Asian Preferential Arrangement
SELA: Latin American Economic System

TRIMS: Trade Related Investment Measures
TRIPS: Trade-related Aspects of Intellectual Property Rights

13.11 Self Assessment

State whether the following statements are true or false:
1. If we sell any product below its cost of production it's known as dumping.
2. TRIPS cover the patents of a company but not the facility outlay.

3. Any dispute between the trading organisations of the WTO can be presented before the
Dispute Settlement Body which works autonomously of WTO.
4. All the protection measures for investments made by the nations is under TRIPS.

5. In second stage of the dispute settlement, the parties can seek mediation of the governing
bodies.

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